Exhibit 4.1
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GS ESCROW CORP.
to be merged with and into
GOLDEN STATE HOLDINGS INC.
Issuer
and
THE BANK OF NEW YORK
Trustee
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INDENTURE
Dated as of August 6, 1998
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Providing for Issuance of Senior Securities in Series
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TABLE OF CONTENTS
ARTICLE I
Definitions and Incorporation by Reference
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SECTION 1.01. Definitions...............................................................................1
SECTION 1.02. Other Definitions........................................................................23
SECTION 1.03. Incorporation by Reference of Trust Indenture Act........................................23
SECTION 1.04. Rules of Construction....................................................................24
ARTICLE II
The Securities
SECTION 2.01. Form of Securities.......................................................................25
SECTION 2.02. Form of Trustee's Certificate of Authentication..........................................26
SECTION 2.03. General Limitations; Issuable in Series; Terms of Particular Series......................26
SECTION 2.04. Denominations............................................................................29
SECTION 2.05. Execution and Authentication.............................................................29
SECTION 2.06. Registrar and Paying Agent...............................................................30
SECTION 2.07. Paying Agent To Hold Money in Trust......................................................31
SECTION 2.08. Holder Lists.............................................................................31
SECTION 2.09. Transfer and Exchange....................................................................31
SECTION 2.10. Replacement Securities...................................................................33
SECTION 2.11. Outstanding Securities...................................................................33
SECTION 2.12. Temporary Securities.....................................................................34
SECTION 2.13. Cancellation.............................................................................34
SECTION 2.14. Payment of Interest; Defaulted Interest..................................................34
SECTION 2.15. Delayed Issuance of Securities...........................................................35
SECTION 2.16. CUSIP Numbers............................................................................35
ARTICLE III
Redemption
SECTION 3.01. Applicability of Article.................................................................36
SECTION 3.02. Election to Redeem; Notices to Trustee...................................................36
SECTION 3.03. Selection of Securities To Be Redeemed...................................................36
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SECTION 3.04. Notice of Redemption.....................................................................37
SECTION 3.05. Effect of Notice of Redemption...........................................................38
SECTION 3.06. Deposit of Redemption Price..............................................................38
SECTION 3.07. Securities Redeemed in Part..............................................................39
ARTICLE IV
Covenants
SECTION 4.01. Payment of Securities....................................................................39
SECTION 4.02. SEC Reports .............................................................................39
SECTION 4.03. Limitation on Debt.......................................................................39
SECTION 4.04. Limitation on Restricted Payments........................................................41
SECTION 4.05. Limitation on Transactions with Affiliates...............................................43
SECTION 4.06. Change of Control........................................................................45
SECTION 4.07. Limitation on Other Business Activities of Escrow Corp...................................46
SECTION 4.08. Limitations on Restrictions on Distributions by Subsidiaries.............................46
SECTION 4.09. Limitation on Liens......................................................................47
SECTION 4.10. Limitation on Sale of Capital Stock of, and Merger or Sale of Assets by, the Bank........48
SECTION 4.11. Maintenance of Status of the Bank as an Insured Depository Institution; Capital
Maintenance............................................................................49
SECTION 4.12. Compliance Certificates..................................................................49
SECTION 4.13. Applicability of Article IV; Investment Grade Covenant Changes...........................50
SECTION 4.14. Waiver of Certain Covenants..............................................................50
SECTION 4.15. Further Instruments and Acts.............................................................50
ARTICLE V
Successor Company
SECTION 5.01. When Holdings and Escrow Corp. May Merge or Transfer Assets..............................50
ARTICLE VI
Defaults and Remedies
SECTION 6.01. Events of Default........................................................................52
SECTION 6.02. Acceleration.............................................................................54
SECTION 6.03. Other Remedies...........................................................................55
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SECTION 6.04. Waiver of Past Defaults..................................................................55
SECTION 6.05. Control by Majority of Securityholders...................................................55
SECTION 6.06. Limitation on Suits......................................................................55
SECTION 6.07. Rights of Holder To Receive Payment......................................................56
SECTION 6.08. Collection Suit by Trustee...............................................................56
SECTION 6.09. Trustee May File Proofs of Claim.........................................................56
SECTION 6.10. Priorities .............................................................................57
SECTION 6.11. Undertaking for Costs....................................................................57
SECTION 6.12. Waiver of Stay or Extension Laws.........................................................57
ARTICLE VII
The Trustee
SECTION 7.01. Duties of Trustee........................................................................58
SECTION 7.02. Rights of Trustee........................................................................59
SECTION 7.03. Individual Rights of Trustee.............................................................60
SECTION 7.04. Trustee's Disclaimer.....................................................................60
SECTION 7.05. Notice of Defaults.......................................................................60
SECTION 7.06. Reports by Trustee to Holders............................................................60
SECTION 7.07. Compensation and Indemnity...............................................................61
SECTION 7.08. Replacement of Trustee...................................................................61
SECTION 7.09. Successor Trustee by Merger..............................................................63
SECTION 7.10. Eligibility; Disqualification............................................................63
SECTION 7.11. Preferential Collection of Claims Against the Issuer.....................................63
SECTION 7.12. Money Held in Trust......................................................................63
ARTICLE VIII
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securities; Defeasance.........................................64
SECTION 8.02. Conditions to Defeasance.................................................................65
SECTION 8.03. Application of Trust Money...............................................................66
SECTION 8.04. Repayment to the Issuer..................................................................66
SECTION 8.05. Indemnity for Government Obligations.....................................................67
SECTION 8.06. Reinstatement............................................................................67
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ARTICLE IX
Amendments and Supplemental Indentures
SECTION 9.01. Without Consent of Holders...............................................................67
SECTION 9.02. With Consent of Holders..................................................................68
SECTION 9.03. Compliance with Trust Indenture Act......................................................69
SECTION 9.04. Revocation and Effect of Consents and Waivers............................................69
SECTION 9.05. Notation on or Exchange of Securities....................................................70
SECTION 9.06. Trustee To Sign Amendments and Supplemental Indentures...................................70
SECTION 9.07. Effect of Amendment or Supplemental Indenture............................................71
SECTION 9.08. Payment for Consent......................................................................71
ARTICLE X
Miscellaneous
SECTION 10.01. Trust Indenture Act Controls............................................................71
SECTION 10.02. Notices .............................................................................71
SECTION 10.03. Communication by Holders with other Holders.............................................72
SECTION 10.04. Certificate and Opinion as to Conditions Precedent......................................72
SECTION 10.05. Statements Required in Certificate or Opinion...........................................72
SECTION 10.06. When Securities Disregarded.............................................................73
SECTION 10.07. Rules by Trustee, Paying Agent and Registrar............................................73
SECTION 10.08. Legal Holidays..........................................................................73
SECTION 10.09. Governing Law...........................................................................73
SECTION 10.10. No Recourse Against Others..............................................................74
SECTION 10.11. Successors .............................................................................74
SECTION 10.12. Multiple Originals......................................................................74
SECTION 10.13. Table of Contents; Headings.............................................................74
SECTION 10.14. Separability Clause.....................................................................74
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INDENTURE, dated as of August 6, 1998, between GS ESCROW
CORP., a Delaware corporation (the "Issuer"), and THE BANK OF NEW YORK, a New
York banking corporation (the "Trustee").
The Issuer deems it necessary to issue from time to time for
its lawful purposes senior debt securities (hereinafter called the "Securities")
evidencing its unsecured and unsubordinated indebtedness, and has duly
authorized the execution and delivery of this Indenture to provide for the
issuance from time to time of the Securities, unlimited as to principal amount,
to bear interest at the rates or formulas, to mature at such times and to have
such other provisions as shall be fixed as hereinafter provided.
Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the Holders of the Issuer's
Securities:
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.01. Definitions.
"Adjusted Consolidated Net Worth" of any Person means, as of
any date of determination in respect of an Issuance of Debt, the Consolidated
Net Worth of such Person as of the end of the most recent fiscal quarter ending
at least 45 days prior to such determination date; provided, however, that pro
forma effect shall be given (x) to any of the following that shall have occurred
since the end of such fiscal quarter or that shall occur simultaneously with or
immediately following such Issuance and (y) to the use of the proceeds of such
Issuance to effect any of the following (in each case without duplication and as
if the following had occurred on the last day of such fiscal quarter): (i) all
Issuances of Capital Stock by such Person and equity contributions to such
Person, (ii) all Investments in or acquisitions of a Subsidiary or Person that
becomes a Subsidiary as a result of such Investment or acquisition or in
property which constitutes all or substantially all of an operating unit of a
business, (iii) all Restricted Payments and Permitted Investments and (iv) all
Asset Dispositions. For purposes of this definition, whenever pro forma effect
is to be given to an Issuance of Capital Stock or an equity contribution, an
Investment in any Person, an acquisition of assets, an Asset Disposition, a
Restricted Payment, a Permitted Investment, the amount of revenue or earnings
relating thereto, or any other circumstance, the pro forma calculations shall be
determined in good faith by a responsible financial or accounting officer of
Holdings.
"Affiliate" of any specified Person means: (i) any other
Person which, directly or indirectly, is in control of, is controlled by or is
under common control with such specified Person or (ii) any other Person who is
a director or executive
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officer (A) of such specified Person, (B) of any Subsidiary of such specified
Person or (C) of any Person described in clause (i) above. For purposes of this
definition, control of a Person means the power, direct or indirect, to direct
or cause the direction of the management and policies of such Person whether by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Affiliated Permitted Holder" means any member of a Permitted
Holder Group if the members of such Group own, in the aggregate, legally or
beneficially 5% or more of the voting power of the Voting Stock of Escrow Corp.
or Holdings.
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) of
shares of Capital Stock of a Subsidiary of Holdings, or property or other assets
of Holdings or any Subsidiary of Holdings (each referred to for the purposes of
this definition as a "disposition") by Holdings or any of its Subsidiaries
(including any disposition by means of a merger, consolidation or similar
transaction) other than (i) a disposition by a Wholly Owned Subsidiary of
Holdings to Holdings or by Holdings or a Wholly Owned Subsidiary of Holdings to
a Wholly Owned Subsidiary of Holdings, (ii) a disposition of property or assets
by Holdings or its Subsidiaries at fair market value in the ordinary course of
business, and (iii) an issuance of employee stock options.
"Average Life" means, with respect to any Debt, the quotient
obtained by dividing (i) the sum of the products of (a) the number of years from
the date of the transaction or event giving rise to the need to calculate the
Average Life of such Debt to the date, or dates, of each successive scheduled
principal payment of such Debt multiplied by (b) the amount of each such
principal payment by (ii) the sum of all such principal payments.
"Bank" means California Federal Bank, a Federal Savings Bank,
and its successors, except as otherwise provided in Section 4.10.
"Bank Dividend" means, to the extent required, a cash dividend
from the Bank of up to $122.9 million to finance in part the Debt Tender Offers,
the Bank Preferred Stock Tender Offers and the Parent Holdings Defeasance.
"Bank Preferred Stock" means (i) the 11-1/2% Noncumulative
Perpetual Preferred Stock issued by the Bank, (ii) the 10-5/8% Noncumulative
Perpetual Preferred Stock issued by the Bank, (iii) the 9-1/8% Noncumulative
Exchangeable Preferred Stock, Series A, issued by California Federal Preferred
Capital Corporation, (iv) the Preferred Stock, Series E, issued by Glendale
Federal and (v) at Holdings' election, other Preferred Stock of the Bank or any
Subsidiary of the Bank issued to Refinance stock described in the foregoing
clauses (i) through (iv) in an aggregate liquidation value at no time exceeding
the sum of the liquidation value
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of the stock to be Refinanced on the Issue Date plus reasonable fees and
expenses incurred in connection with such Refinancing and accrued dividends and
premium, if any.
"Bank Preferred Stock Tender Offers" means the cash tender
offers by Holdings (or an Affiliate of Holdings other than Escrow Corp.) for
each of the Bank's two outstanding series of Bank Preferred Stock referred to in
clauses (i) and (ii) of the definition thereof.
"Board of Directors" means, with respect to any Person, the
Board of Directors of such Person or any committee thereof duly authorized to
act on behalf of such Board.
"Business Day" means, with respect to any series of
Securities, unless otherwise specified in a supplemental indenture or Certified
Board Resolution and any related Officer's Certificate with respect to a
particular series of Securities, each day which is not a Legal Holiday.
"CALGLs" means the Secondary Contingent Litigation Recovery
Participation Interests issued by the Bank.
"CALGZs" means the Contingent Litigation Recovery
Participation Interests issued by the Bank.
"Capital Lease Obligation" of a Person means any obligation
which is required to be classified and accounted for as a capital lease on the
face of a balance sheet of such Person prepared in accordance with GAAP; the
amount of such obligation shall be the capitalized amount thereof, determined in
accordance with GAAP; and the Stated Maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of a
penalty.
"Capital Stock" of any Person means any and all shares,
interests (including partnership interests), rights to purchase, warrants,
options, participations or other equivalents of or interests in (however
designated) equity of such Person, including any Preferred Stock, but excluding
any debt securities convertible into or exchangeable for such equity and, in the
case of the Bank, excluding any CALGZs and CALGLs.
"Certified Board Resolution" means a copy of a resolution
certified by the Secretary or an Assistant Secretary of the Issuer to have been
duly adopted by the Board of Directors of the Issuer and to be in full force and
effect on the date of such certification, and delivered to the Trustee.
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"Change of Control" means the occurrence of any of the
following events on or after the Issue Date:
(i) any Person other than a Permitted Holder shall be the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, of a majority in the aggregate
of the total voting power of the Voting Stock of Holdings, whether as a
result of the Issuance of securities of Holdings, any merger,
consolidation, liquidation or dissolution of Holdings, any direct or
indirect transfer of securities by a Permitted Holder or otherwise; or
(ii) during any period of two consecutive years, individuals
who at the beginning of such period constituted the Board of Directors
of Holdings or Golden State (together with any new directors whose
election by such Board of Directors or whose nomination for election by
the shareholders of Holdings or of Golden State was approved by a vote
of 66-2/3% of the directors of Holdings or Golden State then still in
office who were either directors at the beginning of such period or
whose election or nomination for election was previously so approved)
cease for any reason to constitute a majority of the Board of Directors
of Holdings or Golden State then in office;
provided, however, that at and after the occurrence of a transaction referred to
in Section 4.10(d), all references to Holdings in the foregoing clauses (i) and
(ii) shall be deemed to be references to Holdings or the Bank.
"Code" means the Internal Revenue Code of 1986, as amended.
"Common Stock" of any Person means the common stock of such
Person, but in the case of the Bank means the common stock of the Bank excluding
any CALGZs and CALGLs.
"Consolidated Common Shareholders' Equity" of the Bank means,
at any date, all amounts which would, in conformity with GAAP, be included under
shareholders' equity on a consolidated balance sheet of the Bank as at such
date, less any amounts included therein attributable to, without duplication,
(i) Redeemable Stock, (ii) Exchangeable Stock and (iii) Preferred Stock held by
Persons other than Holdings and its Wholly Owned Subsidiaries.
"Consolidated Net Income" of Holdings means for any period the
consolidated net income (or loss) of Holdings and its consolidated Subsidiaries
for such period determined in accordance with GAAP, less, without duplication,
the amount of dividends declared during such period in respect of any Bank
Preferred Stock and Qualified Preferred Stock held by Persons other than
Holdings and its Wholly Owned Subsidiaries (to the extent not deducted from
Consolidated Net Income
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in accordance with GAAP); provided, however, that there shall be excluded
therefrom (to the extent included in calculating such net income (or loss)):
(a) any net income (or loss) of any Person if such Person is
not a Subsidiary, except that (A) Holdings' equity in the net income of
any such Person for such period shall be included in such Consolidated
Net Income up to the aggregate amount of cash actually distributed by
such Person during such period to Holdings or a Subsidiary as a
dividend or other distribution (subject, in the case of a dividend or
other distribution to a Subsidiary, to the limitations contained in
clause (c) below) and (B) Holdings' equity in a net loss of any such
Person for such period shall be included in determining such
Consolidated Net Income;
(b) any net income (or loss) of any Person acquired by
Holdings or a Subsidiary in a pooling of interests transaction for any
period prior to the date of such acquisition;
(c) any net income (or loss) of any Subsidiary (other than the
Bank, any other Depository Institution or any Subsidiaries of any of
the foregoing) if such Subsidiary is subject to restrictions, directly
or indirectly, on the payment of dividends or the making of
distributions by such Subsidiary, directly or indirectly, to Holdings
(other than restrictions contained in any Qualified Preferred Stock),
except that (A) Holdings' equity in the net income of any such
Subsidiary for such period shall be included in such Consolidated Net
Income up to the aggregate amount of cash actually distributed by such
Subsidiary during such period to Holdings or another Subsidiary as a
dividend or other distribution (subject, in the case of a dividend or
other distribution to another Subsidiary, to the limitation contained
in this clause) and (B) Holdings' equity in a net loss of any such
Subsidiary for such period shall be included in determining such
Consolidated Net Income;
(d) any gain (but not loss) realized upon the sale or other
disposition of any property, plant or equipment of Holdings or its
consolidated Subsidiaries (other than in connection with the sale of
insured deposits) (including pursuant to any sale-and-leaseback
arrangement) and any gain (but not loss) realized upon the sale or
other disposition of any Capital Stock of any Person;
(e) the cumulative effect of a change in accounting
principles;
(f) the gain (but not the loss) from the sale, transfer,
conveyance or other disposition (other than to Holdings or any of its
Subsidiaries) in a single transaction or in a series of related
transactions, in either case occurring outside the ordinary course of
business, of more than 75% of the assets of the Mortgage Bank shown on
a balance sheet of the Mortgage Bank as of the end
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of the most recent fiscal quarter ending at least 45 days prior to such
transaction (or the first transaction in such related series of
transactions); and
(g) all non-recurring charges or benefits incurred or recorded
in connection with the Transactions.
"Consolidated Net Worth" of any Person means, at any date, all
amounts which would, in conformity with GAAP, be included under shareholders'
equity on a consolidated balance sheet of such Person as at such date, less any
amounts included therein attributable to (x) Redeemable Stock and (y)
Exchangeable Stock.
"Debt" of any Person means, on any date of determination,
without duplication,
(i) the principal of (A) indebtedness of such Person for money
borrowed and (B) indebtedness evidenced by notes, debentures, bonds or
other similar instruments for the payment of which such Person is
responsible or liable, including, in each case, any premium on such
indebtedness to the extent such premium has become due and payable;
(ii) all Capital Lease Obligations of such Person;
(iii) all obligations of such Person issued or assumed as the
deferred purchase price of property, all conditional sale obligations
of such Person and all obligations of such Person under any title
retention agreement (but excluding trade accounts payable and other
accrued current liabilities arising in the ordinary course of
business);
(iv) all obligations of such Person for the reimbursement of
any obligor on any letter of credit, banker's acceptance or similar
credit transaction (other than obligations with respect to letters of
credit securing obligations (other than obligations described in (i)
through (iii) above) entered into in the ordinary course of business of
such Person to the extent such letters of credit are not drawn upon or,
if and to the extent drawn upon, such drawing is reimbursed no later
than the third Business Day following receipt by such Person of a
demand for reimbursement following payment on the letter of credit);
(v) the amount of all obligations of such Person with respect
to the redemption, repayment (including liquidation preference) or
other repurchase of any Preferred Stock of any Subsidiary or any
Redeemable Stock of Holdings (but excluding in each case any accrued
dividends);
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(vi) all obligations of the type referred to in clauses (i)
through (v) of other Persons and all dividends of other Persons for the
payment of which, in either case, such Person is responsible or liable,
directly or indirectly, as obligor, guarantor or otherwise, including
Guarantees of such obligations and dividends; and
(vii) all obligations of the type referred to in clauses (i)
through (vi) of other Persons secured by any Lien on any property or
asset of such Person (whether or not such obligation is assumed by such
Person), the amount of such obligation being deemed to be the lesser of
the value of such property or assets or the amount of the obligation so
secured.
"Debt Tender Offers" means the cash tender offers and consent
solicitations by Holdings (or an Affiliate of Holdings other than Escrow Corp.)
for each of the three outstanding issues of FNH Notes.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Depository" means, unless otherwise specified by the Issuer
pursuant to Section 2.03, with respect to Securities of any series issuable or
issued as a Global Security, The Depository Trust Company or any successor
clearing agency registered under the Exchange Act and designated to act as
Depository for such Global Securities by the Trustee.
"Depository Institution" shall have the meaning attributed
thereto in Section 3(c)(1) of the FDIA, 12 U.S.C. ss. 1813(c)(1), or a similar
definition under any successor statute.
"Earnings Available for Fixed Charges" means, for any period,
an amount equal to, for Holdings and its consolidated Subsidiaries, the sum of
Consolidated Net Income for such period, plus the following to the extent
reducing Consolidated Net Income for such period: (i) the provision for taxes
based on income or profits or utilized in computing net loss, (ii) Fixed Charges
and (iii) amortization of goodwill. Notwithstanding the foregoing, the provision
for taxes based on the income or profits of, and amortization of goodwill of, a
Subsidiary shall be added to Consolidated Net Income to compute Earnings
Available for Fixed Charges only to the extent (and in the same proportion) that
the net income of such Subsidiary was included in calculating Consolidated Net
Income and, in the case of any Subsidiary other than the Bank, any other
Depository Institution or any Subsidiaries of any of the foregoing, only if a
corresponding amount would be permitted at the date of determination to be
dividended to Holdings by such Subsidiary without prior approval (that has not
been obtained), pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders, statutes, rules and governmental
regulations applicable to such Subsidiary or its shareholders.
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"Escrow Agreement" means the Escrow Agreement, dated as of
August 6, 1998, between Escrow Corp. and The Bank of New York, as Escrow
Agent, as amended from time to time.
"Escrow Corp." means GS Escrow Corp., a Delaware corporation,
not including Holdings or any other successors thereof.
"Escrow Corp. Merger" means the merger of Escrow Corp. with
and into Golden State Holdings pursuant to the Escrow Corp. Merger Agreement.
"Escrow Corp. Merger Agreement" means the Merger Agreement,
dated as of August 6, 1998, between Golden State Holdings and Escrow Corp., as
amended from time to time.
"Escrow Debt" means Debt of the Issuer that is not secured by
any Lien on any assets, property or Capital Stock owned by the Issuer or any of
its Subsidiaries, the proceeds of which Debt are used solely for deposit (or the
purchase of U.S. Government Obligations to be deposited) with the Escrow Agent
in an amount not to exceed the amount necessary, together with the net proceeds
to the Issuer of the issuance of the Initial Securities, to enable the Issuer to
make the Initial Deposit (as defined in the Escrow Agreement).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Securities" means, with respect to any series of
Initial Securities, Securities of the same series issued in exchange for a like
principal amount of such Initial Securities.
"Exchangeable Stock" means any Capital Stock of a Person which
by its terms or otherwise is required to be exchanged or converted or is
exchangeable or convertible at the option of the holder into another security
(other than Capital Stock of such Person which is neither Exchangeable Stock nor
Redeemable Stock).
"FDIA" means the Federal Deposit Insurance Act.
"Financial Services Subsidiary" means any Subsidiary of
Holdings which conducts any financial asset origination, securitization,
underwriting, financing or servicing business or any other financial services
business.
"Fixed Charge Coverage Ratio" means, as of any date of
determination, the ratio of (a) the aggregate amount of Earnings Available for
Fixed Charges for the most recent four consecutive fiscal quarters ending at
least 45 days prior to such determination date to (b) Fixed Charges for such
four fiscal quarters; provided, however, that (i) if (A) since the beginning of
such period Holdings has
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Issued any Debt that remains outstanding or Repaid any Debt or (B) the
transaction giving rise to the need to calculate the Fixed Charge Coverage Ratio
is an Issuance or Repayment of Debt, Fixed Charges for such period shall be
calculated after giving effect on a pro forma basis to such Issuance or
Repayment as if such Debt was Issued or Repaid on the first day of such period,
provided that, in the event of any such Repayment of Debt, Earnings Available
for Fixed Charges for such period shall be calculated as if Holdings or such
Subsidiary had not earned any interest income actually earned during such period
in respect of the funds used to Repay such Debt, and (ii) if (A) since the
beginning of such period Holdings or any Subsidiary shall have made any Asset
Disposition or an Investment (by merger or otherwise) in any Subsidiary (or any
Person which becomes a Subsidiary) or an acquisition of property which
constitutes all or substantially all of an operating unit of a business, (B) the
transaction giving rise to the need to calculate the Fixed Charge Coverage Ratio
is occurring in connection with such an Asset Disposition, Investment or
acquisition or (C) since the beginning of such period any Person (that
subsequently became a Subsidiary or was merged with or into Holdings or any
Subsidiary since the beginning of such period) shall have made such an Asset
Disposition, Investment or acquisition, Earnings Available for Fixed Charges for
such period shall be calculated after giving pro forma effect to such Asset
Disposition, Investment or acquisition as if such Asset Disposition, Investment
or acquisition occurred on the first day of such period. If any Debt bears a
floating rate of interest and its Issuance is being given pro forma effect, the
interest expense on such Debt shall be calculated as if the base interest rate
in effect for such floating rate of interest on the date of determination had
been the applicable base interest rate for the entire period (taking into
account any interest rate agreement applicable to such Debt if such interest
rate agreement has a remaining term in excess of 12 months). In the event the
Capital Stock of any Subsidiary is sold during the period, Holdings shall be
deemed, for purposes of clause (i) above, to have Repaid as of the beginning of
such period the Debt of such Subsidiary to the extent Holdings and its
continuing Subsidiaries are no longer liable for such Debt after such sale. For
purposes of this definition, whenever pro forma effect is to be given to an
Asset Disposition, an Investment in any Person, an acquisition of assets, the
amount of revenue or earnings relating thereto, the amount of Fixed Charges
associated with any Debt, or any other circumstance, the pro forma calculations
shall be determined in good faith by a responsible financial or accounting
officer of Holdings.
"Fixed Charges" means, for any period, the sum of (i) the
total interest expense of Holdings on an unconsolidated basis determined in
accordance with GAAP for such period and (ii) dividends payable on any
Redeemable Stock of Holdings for such period.
"FNH" means First Nationwide Holdings Inc., a Delaware
corporation.
"FNH Asset Transfer" means the contribution by FNH of all of
its assets to Golden State Holdings and the assumption by Golden State Holdings
of all of the obligations of FNH.
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"FNH Notes" means (i) the 12-1/4% Senior Notes Due 2001 and
12-1/4% Senior Exchange Notes Due 2001 issued by FNH pursuant to an Indenture,
dated as of July 15, 1994, as supplemented, between FNH and The First National
Bank of Boston, as the original Trustee, as such Indenture may be amended from
time to time, (ii) the 9-1/8% Senior Subordinated Notes Due 2003 and the 9-1/8%
Senior Subordinated Exchange Notes due 2003 issued by FNH pursuant to an
Indenture, dated as of January 31, 1996, between FNH and The Bank of New York,
as Trustee, as such Indenture may be amended from time to time, and (iii) and
the 10-5/8% Senior Subordinated Notes Due 2003 and 10-5/8% Senior Subordinated
Exchange Notes Due 2003 issued by FNH pursuant to an Indenture, dated as of
September 19, 1996, as supplemented, between FNH and The Bank of New York, as
Trustee, as such Indenture may be amended from time to time.
"Generally Accepted Accounting Principles" or "GAAP" means
generally accepted accounting principles in the United States, as in effect from
time to time, except that, for purposes of calculating Consolidated Net Income,
Consolidated Net Worth and Consolidated Common Shareholders' Equity, it shall
mean generally accepted accounting principles in the United States as in effect
on the Issue Date.
"Glendale Federal" means Glendale Federal Bank, Federal
Savings Bank.
"Global Security", when used with respect to any series of
Securities issued hereunder, means the certificate(s) representing the
Securities of a series, which are deposited with, or on behalf of, the
Depository or pursuant to the Depository's instruction, all in accordance with
this Indenture and an indenture supplemental hereto, if any, or Certified Board
Resolution and pursuant to an Issuer Request, which shall be registered in the
name of the Depository or its nominee.
"Golden State" means Golden State Bancorp Inc., a Delaware
corporation.
"Golden State Acquisition" refers collectively to the
following transactions pursuant to the Merger Agreement: (i) the FNH Asset
Transfer, (ii) the merger of Parent Holdings with and into Golden State, (iii)
the merger of FNH with and into Golden State Financial Corporation and (iv) the
merger of Glendale Federal with and into the Bank.
"Golden State Holdings" means New First Nationwide Holdings
Inc. (to be renamed Golden State Holdings Inc. upon the consummation of the
Golden State Acquisition).
"Guarantee" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Debt or other obligation of
any other Person and any obligation, direct or indirect, contingent or
otherwise, of such Person:
11
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Debt or other obligation of such other Person (whether arising by
virtue of partnership arrangements, or by agreement to keep well, to purchase
assets, goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for purposes of assuring
in any other manner the obligee of such Debt or other obligation of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); provided, however, that the term "Guarantee" shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Holder", when used with respect to any Security, means a
Securityholder.
"Holdings" means (i) prior to consummation of the Golden State
Acquisition, FNH and, (ii) from and after consummation of the Golden State
Acquisition, Golden State Holdings and its successors, except as otherwise
provided in Section 4.10 or 5.01.
"Indenture" means this instrument, as it may from time to time
be supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof and shall include the terms of
particular series of Securities established as contemplated by Section 2.03;
provided, however, that, if at any time more than one Person is acting as
Trustee under this instrument, "Indenture" shall mean, with respect to any one
or more series of Securities for which such Person is Trustee, this instrument,
as it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof
and shall include the terms of the particular series of Securities for which
such Person is Trustee established as contemplated by Section 2.03, exclusive,
however, of any provisions or terms which relate solely to other series of
Securities for which such Person is not Trustee, regardless of when such terms
or provisions were adopted.
"Initial Securities" means the Floating Rate Notes Due 2003,
the 6 3/4% Senior Notes Due 2001, the 7% Senior Notes Due 2003 and the 71/8%
Senior Notes Due 2005, each issued by Escrow Corp. pursuant to this Indenture.
"Interest Payment Date", when used with respect to any series
of Securities, means the date specified in such security as the fixed date on
which any installment of interest on those Securities is due and payable.
"Investment" in any Person means any loan or advance to, any
net payment on a Guarantee of, any acquisition of Capital Stock, equity
interest, obligation or other security of, or capital contribution or other
investment in, such
12
Person. Investments shall exclude loans or advances to customers and suppliers
in the ordinary course of business. The term "Invest" has a corresponding
meaning.
"Investment Grade" means, in respect of any series of
Securities, a rating of the Securities of such series by both S&P and Moody's,
each such rating being in one of such agency's four highest generic ratings
categories that signifies investment grade (i.e. BBB- (or the equivalent) or
higher by S&P and Baa3 (or the equivalent) or higher by Moody's); provided, in
each case, such ratings are publicly available; provided further that in the
event Moody's or S&P is no longer in existence, for purposes of determining
whether such Securities are rated "Investment Grade," such organization may be
replaced by a nationally recognized statistical rating organization (as defined
in Rule 436 under the Securities Act) designated by the Issuer, notice of which
designation shall be given to the Trustee.
"Issue" means issue, assume, Guarantee, incur or otherwise
become liable for; provided, however, that any Debt or Capital Stock of a Person
existing at the time such Person becomes a Subsidiary of another Person (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be issued
by such Subsidiary at the time it becomes a Subsidiary of such other Person.
"Issue Date" means the date of the original issue of the
Initial Securities.
"Issuer" means (i) prior to the consummation of the Escrow
Corp. Merger, Escrow Corp., and (ii) from and after consummation of the Escrow
Corp. Merger, Holdings until a successor replaces it and, thereafter, means the
successor and, for purposes of any provision contained herein and required by
the TIA, each other obligor on the indenture securities.
"Issuer Request," "Issuer Order" and "Issuer Consent" mean a
written request, order or consent, respectively, signed in the name of the
Issuer by its Chairman of the Board, President or a Vice President, and by its
Treasurer, an Assistant Treasurer, Controller, an Assistant Controller,
Secretary or an Assistant Secretary, and delivered to the Trustee.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions are required or permitted to be closed in the State of New
York or in the state where the principal office of the Trustee is located.
"Lien" means any mortgage, pledge, security interest,
conditional sale or other title retention agreement or other similar lien.
"Litigations" means (i) the claim against the United States
in the lawsuit California Federal Bank v. United States, Civil Action No.
92-138C, (ii) the claim against the United States in the lawsuit Glendale
Federal Bank, F.S.B. v.
13
United States, No. 90-772C, in the United States Court of Federal Claims, filed
August 15, 1990, and (iii) the claim against the United States in the lawsuit
First Nationwide Bank, et al. v. United States, Civil Action No. 96-590C,
filed on September 20, 1996.
"Mafco Holdings" means Mafco Holdings Inc., a Delaware
corporation, and its successors.
"Merger Agreement" means the Agreement and Plan of
Reorganization dated as of February 4, 1998 by and among Golden State, Golden
State Financial Corporation, Parent Holdings, FNH, First Gibraltar Holdings Inc.
and Hunter's Glen/Ford, Ltd., as amended from time to time.
"Minimum Common Equity Amount" means, as of the end of any
fiscal quarter, an amount equal to the sum of (i) $800 million and (ii) the
excess, if any, of amounts attributable to goodwill and core deposit intangible
on the consolidated balance sheet of the Bank as at the end of such fiscal
quarter, over $100 million.
"Moody's" means Moody's Investors Service, Inc.
"Mortgage Bank" means the Subsidiary of Holdings which on the
Issue Date is a Subsidiary of the Bank that is engaged in the mortgage banking
business, including the business of originating or carrying mortgage loans.
"Net Cash Proceeds", with respect to any issuance or sale of
Capital Stock, means the cash proceeds of such issuance or sale net of
attorneys' fees, accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other fees actually
incurred in connection with such issuance or sale and net of taxes paid or
estimated in good faith to be payable as a result thereof.
"Non-Convertible Capital Stock" means, with respect to any
corporation, any non-convertible Capital Stock of such corporation and any
Capital Stock of such corporation convertible solely into non-convertible common
stock of such corporation; provided, however, that Non-Convertible Capital Stock
shall not include any Redeemable Stock or Exchangeable Stock.
"Offering" means the offering by Escrow Corp. of the Initial
Securities.
"Officer" means the Chairman of the Board, the Vice Chairman,
the President, any Vice President, the Treasurer, an Assistant Treasurer or the
Secretary or an Assistant Secretary of the Issuer.
14
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, the Vice Chairman, the President or a Vice President
(regardless of Vice Presidential designation), and by the Treasurer, an
Assistant Treasurer, Secretary or an Assistant Secretary, of the Issuer, and
delivered to the Trustee. One of the Officers signing an Officers' Certificate
given pursuant to Section 4.12 shall be the principal executive, financial or
accounting officer of the Issuer.
"Opinion of Counsel" means a written opinion from legal
counsel who is reasonably acceptable to the Trustee. The counsel may be an
employee of or counsel to the Issuer (or Holdings, Mafco Holdings, Parent or one
of its Subsidiaries) or the Trustee.
"Original Issue Discount Security" means (i) any Security
which provides for an amount less than the principal amount thereof to be due
and payable upon a declaration of acceleration of the Stated Maturity thereof,
and (ii) any other security which is issued with "original issue discount"
within the meaning of Section 1273(a) of the Code and the regulations
thereunder.
"Parent" means Golden State and any other person which
acquires or owns, after the consummation of the Golden State Acquisition,
directly or indirectly 80% or more of the voting power of the Voting Stock of
Holdings.
"Parent Holdings" means First Nationwide (Parent) Holdings
Inc., a Delaware corporation.
"Parent Holdings Defeasance" means the mailing of a 30-day
notice of redemption for all of the outstanding Parent Holdings Notes and the
irrevocable deposit in trust of money or U.S. Government Obligations in an
amount sufficient to pay the redemption price therefor, together with any
accrued and unpaid interest to the date of redemption, for the purpose of
defeasing the Parent Holdings Notes.
"Parent Holdings Notes" means the 12-1/2% Senior Notes Due
2003 issued by Parent Holdings pursuant to an Indenture, dated as of April 15,
1996, between Parent Holdings and The Bank of New York, as Trustee, as such
Indenture may be amended from time to time.
"Permitted Acquisition Debt" shall mean Debt of Holdings the
proceeds of which are used for the acquisition of a Depository Institution or a
Financial Services Subsidiary or which are used by a Subsidiary that is either a
Depository Institution or Financial Services Subsidiary to acquire assets
outside the ordinary course of business that extend the geographic scope or
product lines of such Depository Institution or Financial Services Subsidiary,
and a Refinancing of any such Debt.
15
"Permitted Affiliate" means any individual that is a director
or executive officer of Holdings, of a Subsidiary of Holdings, of an
Unrestricted Affiliate or of Golden State, any Person controlled by Golden State
or any successor to any of the foregoing; provided, however, that such
individual is not also a director or executive officer of Mafco Holdings, any
Person that controls Mafco Holdings or any successor to any of the foregoing.
"Permitted Holder Group" means either (i) Ronald O. Perelman
and his Related Persons, collectively, or (ii) Gerald J. Ford and his Related
Persons (including, without limitation, Hunter's Glen/Ford, Ltd.), collectively.
"Permitted Holders" means the members of the Permitted Holder
Groups.
"Permitted Investments" means: (i) Investments consisting of
loans to directors and executive officers (other than any such director or
executive officer that is the beneficial owner of 5% or more of the voting power
of the Voting Stock of Holdings) of any Subsidiary of Holdings made in the
ordinary course of its business and in compliance with all regulatory
restrictions on such loans, (ii) Investments consisting of loans to Affiliates
of Holdings so long as (in the case of this clause (ii) only) the Consolidated
Common Shareholders' Equity of the Bank as of the end of the most recent fiscal
quarter ending at least 45 days prior to the date of such Investment was at
least equal to the Minimum Common Equity Amount as of the end of such fiscal
quarter, (iii) Investments in Holdings, in any Subsidiary of Holdings or in any
Person which would become a Subsidiary of Holdings as a result of such
Investment and (iv) Investments in Unrestricted Affiliates.
"Permitted Refinancing Debt" means any Debt that Refinances
any other Debt, including any successive Refinancings, so long as (a) the new
Debt is in an aggregate principal amount (or if Issued with original issue
discount, an aggregate issue price) not in excess of the sum of (i) the
aggregate principal amount then outstanding (or if Issued with original issue
discount, the aggregate accreted value on the date of the Refinancing) of the
Debt being Refinanced and (ii) an amount necessary to pay any fees and expenses,
including underwriters' discounts and commissions, premiums and defeasance
costs, related to such Refinancing, (b) the Average Life of such Debt is equal
to or greater than the Average Life of the Debt being Refinanced, (c) the Stated
Maturity of such Debt is no earlier than the Stated Maturity of the Debt being
Refinanced and (d) if the Debt being Refinanced consists of Subordinated
Obligations, the new Debt shall consist of Subordinated Obligations.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
16
"Predecessor Securities" 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 2.10 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 Stock" as applied to the Capital Stock of any
corporation means Capital Stock of any class or classes (however designated)
which is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Principal" of a Security as of any date means the principal
of the Security as of such date or, in the case of an Original Issue Discount
Security, the amount of the principal thereof that would be due and payable upon
a declaration of acceleration of the Stated Maturity thereof pursuant to Section
6.02 as of such date plus, in the case of any redemption or an offer to
repurchase Securities pursuant to Section 4.06, the premium, if any, payable on
the Security which is due or overdue or is to become due on such date.
"Qualified Preferred Stock" means (x) any Preferred Stock of
any Subsidiary of Holdings that is a Depository Institution or a Subsidiary
thereof (other than Bank Preferred Stock) which meets the requirements set forth
in clauses (a), (b) and (c) below, (y) any Preferred Stock of any Subsidiary of
Holdings (other than any Subsidiary of Holdings that is a Depository Institution
or a Subsidiary thereof) which meets the requirements set forth in clauses (a),
(b), (c) and (d) below, and (z) any Preferred Stock of any Subsidiary of
Holdings (other than the Bank Preferred Stock) issued to Refinance any other
Qualified Preferred Stock or, at Holdings' election, to Refinance any Bank
Preferred Stock, provided that the Preferred Stock issued in such Refinancing
meets the requirements set forth in clauses (a), (b), (c) and (e) below:
(a) such Preferred Stock does not contain any mandatory
redemption provisions which would require it to be redeemed prior to
the first anniversary of the Stated Maturity of all the Securities
outstanding on the date such Preferred Stock is Issued;
(b) the terms of such Preferred Stock do not impose any
consensual encumbrance or restriction on the ability of the issuer
thereof to pay dividends or make distributions on its common stock
except in a manner that is no more restrictive in any material respect
than the following, as determined in good faith by the Board of
Directors of Holdings and evidenced by a resolution adopted by such
Board;
17
(i) dividends and distributions on common stock or
other capital stock of the issuer may not be declared or paid
or set apart for payment at any time when the issuer has not
declared and paid any dividends or distributions on such
Preferred Stock which are required to be declared and paid as
a precondition to dividends or distributions on other capital
stock of the issuer;
(ii) distributions upon the liquidation, dissolution
or winding up of the issuer, whether voluntary or involuntary
("Liquidating Distributions"), may not be made on the common
stock or other capital stock of the issuer at any time when
such Preferred Stock is entitled to receive Liquidating
Distributions which have not been paid; and
(iii) dividends and distributions on common stock or
other capital stock of the issuer may not be declared or paid
or set apart for payment at any time when such Preferred Stock
is required to be, but has not been, redeemed pursuant to
redemption provisions which meet the requirements of clause
(a) above;
(c) the terms of such Preferred Stock do not impose any
consensual encumbrance or restriction on the ability of the issuer
thereof (i) to pay any Debt or other obligation owed to Holdings; (ii)
to make loans or advances to Holdings; or (iii) to transfer any of its
property or assets to Holdings, except, in any such case, any
encumbrance or restriction permitted under Section 4.08 (other than
clause (h) thereof);
(d) in the case of Preferred Stock issued pursuant to clause
(y) above, Consolidated Net Income of Holdings for the Relevant Period
(as defined in the next sentence) on a pro forma basis, after giving
effect to (i) the issuance of such Preferred Stock (including fees and
expenses incurred in connection with such issuance), (ii) the use of
the proceeds thereof, if any, (iii) any acquisition of capital stock or
assets of another Person occurring in connection with the issuance of
such Preferred Stock (including the anticipated revenue and earnings
relating thereto) and (iv) any dividend or other payment obligations
with respect to such Preferred Stock, in each case as if such Preferred
Stock had been issued and any such acquisition had been made on the
first day of the Relevant Period, is no less than the actual
Consolidated Net Income of Holdings for the Relevant Period. "Relevant
Period" means, with respect to any issuance of Preferred Stock, the
four full fiscal quarters most recently ended at least 45 days prior to
the date of such issuance. For purposes of this clause (d), whenever
pro forma effect is to be given to an acquisition of capital stock or
assets, the amount of revenue and earnings relating thereto, or any
other circumstance, the pro forma calculations shall be determined in
good faith by a responsible financial or accounting officer of
Holdings; and
18
(e) in the case of Preferred Stock issued in a Refinancing
pursuant to clause (z) above, the aggregate liquidation value of such
Preferred Stock shall not exceed the sum of the liquidation value of
the Preferred Stock being Refinanced on the date it was originally
issued plus reasonable fees and expenses incurred in connection with
such Refinancing and accrued dividends and premium, if any.
"Redeemable Stock" means, with respect to any Person, Capital
Stock of such Person that by its terms or otherwise is required to be redeemed
on or prior to the first anniversary of the Stated Maturity of all the
Securities outstanding on the date such Capital Stock is Issued or is redeemable
at the option of the holder thereof at any time on or prior to the first
anniversary of the Stated Maturity of such Securities; provided, however, that
any Capital Stock that would not constitute Redeemable Stock but for provisions
thereof giving holders thereof the right to require such Person to purchase or
redeem such Capital Stock upon the occurrence of an "asset sale" or "change of
control" occurring prior to the first anniversary of the Stated Maturity of such
Securities shall not constitute Redeemable Stock if (x) the "asset sale" or
"change of control" provisions applicable to such Capital Stock are not more
favorable to the holders of such Capital Stock than the terms applicable to the
Securities in Sections 4.06 and 4.10, as determined in good faith by the Board
of Directors of Holdings, the determination of which shall be evidenced by a
resolution of such Board of Directors, and (y) any such requirement only becomes
operative after compliance with such covenants, including the purchase of any
Securities tendered pursuant thereto.
"Refinance" or "Repay" means, in respect of any Debt or
Preferred Stock, to refinance, extend, renew, refund, repay, prepay, repurchase,
redeem, defease or retire, or to issue Debt or Preferred Stock in exchange or
replacement for, such Debt or Preferred Stock. "Refinanced" and "Refinancing"
and "Repayment" and "Repaid" shall have correlative meanings.
"Refinancing Transactions" means the Offering, the Bank
Dividend, the Debt Tender Offers, the Bank Preferred Stock Tender Offers and
the Parent Holdings Defeasance.
"Regular Record Date" for the interest payable on any Security
on any Interest Payment Date means the date specified in such Security as the
regular record date relating to such Interest Payment Date.
"Related Person" in respect of any specified Person means (i)
in the event of his incompetence or death, his estate, heirs, executor,
administrator, committee or other personal representative (collectively,
"heirs"), (ii) any Person controlled, directly or indirectly, by such specified
Person or his heirs, and (iii) any trust, corporation, limited liability company
or partnership more than 50% of the beneficial interests of which are held in
the aggregate by such specified Person or one
19
or more members of his immediate family (which shall include his parents,
spouse, children, grandchildren and siblings) or any combination of the
foregoing.
"Responsible Officer," when used with respect to the Trustee,
means any officer of the Trustee with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Restricted Payment" means, as to any Person making a
Restricted Payment: (i) the declaration or payment of any dividend or any
distribution on or in respect of the Capital Stock of such Person (including any
payment in connection with any merger or consolidation involving such Person) or
to the holders of the Capital Stock of such Person (except (x) dividends or
distributions payable solely in the Non-Convertible Capital Stock of such Person
or in options, warrants or other rights to purchase the Non-Convertible Capital
Stock of such Person, and (y) dividends or distributions on Capital Stock of a
Subsidiary of Holdings payable to Holdings or a Subsidiary of Holdings and to
any minority shareholders of a Subsidiary of Holdings), (ii) any purchase,
redemption or other acquisition or retirement for value of any Capital Stock of
Holdings or any Subsidiary, (iii) any purchase, repurchase, redemption,
defeasance or other acquisition or retirement for value, prior to scheduled
maturity, scheduled repayment or scheduled sinking fund payment, of any
Subordinated Obligation (other than the purchase, repurchase or other
acquisition of Subordinated Obligations purchased in anticipation of satisfying
a sinking fund obligation, principal installment or final maturity, in each case
due within one year of the date of acquisition) and (iv) any Investment (other
than a Permitted Investment) in any Affiliate of Holdings.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Security" has the meaning stated in the first recital of this
Indenture and, more particularly, means any Security or Securities authenticated
and delivered under this Indenture; provided, however, that, if at any time
there is more than one Person acting as Trustee under this Indenture,
"Securities" with respect to the Indenture as to which such Person is Trustee
shall have the meaning stated in the first recital of this Indenture and shall
more particularly mean Securities authenticated and delivered under this
Indenture, exclusive, however, of Securities of any series as to which such
Person is not Trustee.
"Securityholder" means a Person in whose name a security is
registered in the Security Register.
20
"Significant Subsidiary" means: (i) any Subsidiary of Holdings
which at the time of determination either (A) had assets which, as of the date
of Holdings' most recent quarterly consolidated balance sheet, constituted at
least 5% of Holdings' total assets on a consolidated basis as of such date, in
each case determined in accordance with GAAP, or (B) had revenues for the
12-month period ending on the date of Holdings' most recent quarterly
consolidated statement of income which constituted at least 5% of Holdings'
total revenues on a consolidated basis for such period or (ii) any Subsidiary of
Holdings which, if merged with all Defaulting Subsidiaries (as defined below) of
Holdings, would at the time of determination either (A) have had assets which,
as of the date of Holdings' most recent quarterly consolidated balance sheet,
would have constituted at least 10% of Holdings' total assets on a consolidated
basis as of such date or (B) have had revenues for the 12-month period ending on
the date of Holdings' most recent quarterly consolidated statement of income
which would have constituted at least 10% of Holdings' total revenues on a
consolidated basis for such period (each such determination being made in
accordance with GAAP). "Defaulting Subsidiary" means any Subsidiary of Holdings
with respect to which an event described under Section 6.01(5), 6.01(6), 6.01(7)
or 6.01(8) has occurred and is continuing.
"S&P" means Standard and Poor's Corporation.
"Stated Maturity" means, with respect to any security, the
date specified in such security as the fixed date on which the final payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency).
"Subordinated Obligation" means, with respect to any series of
Securities, any Debt of Holdings (whether outstanding on the Issue Date or
thereafter Issued) which is subordinate or junior in right of payment to the
Securities of such series.
"Subsidiary" means as to any Person any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of shares of Capital Stock or other interests (including
partnership interest but, in the case of the Bank, excluding any CALGZs and
CALGLs) entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof is at the time owned,
directly or indirectly, by: (i) such Person, (ii) such Person and one or more
Subsidiaries of such Person or (iii) one or more Subsidiaries of such Person.
"Tax Sharing Agreement" means: (i) the Tax Sharing Agreement
as in effect as of the Issue Date to which Holdings, certain of its Subsidiaries
and Mafco Holdings are parties (as the same may be amended to the extent
required in connection with the Transactions) and (ii) any other tax sharing or
allocation
21
agreement to which Holdings or any of its Subsidiaries or any direct or indirect
shareholder of Holdings or any predecessor entity thereto are parties with
respect to consolidated or combined tax returns which include Holdings or any of
its Subsidiaries or any predecessor entity thereto but only to the extent that
amounts payable from time to time by Holdings or any such Subsidiary under any
such agreement do not exceed the corresponding tax payments that Holdings or
such Subsidiary or any predecessor entity thereto would have been required to
make to any relevant taxing authority had Holdings or such Subsidiary or any
predecessor entity thereto not joined in such consolidated or combined returns,
but instead had filed returns including only Holdings or its Subsidiaries or any
predecessor entity thereto, provided that any such agreement may provide that,
if Holdings or any such Subsidiary or any predecessor entity thereto ceases to
be a member of the affiliated or consolidated group of corporations to which
such tax sharing or allocation agreement applies (such cessation, a
"Deconsolidation Event"), then Holdings or such Subsidiary or any predecessor
entity thereto shall indemnify such direct or indirect shareholder with respect
to any Federal, state or local income, franchise or other tax liability
(including any related interest, additions or penalties) imposed on such
shareholder as the result of an audit or other adjustment with respect to any
period prior to such Deconsolidation Event that is attributable to Holdings,
such Subsidiary or any predecessor entity thereto (computed as if Holdings, such
Subsidiary or such predecessor entity, as the case may be, were a stand-alone
entity that filed tax returns including only Holdings or its Subsidiaries or any
predecessor entity thereto), but only to the extent that any such tax liability
exceeds any liability for taxes recorded on the books of Holdings or such
Subsidiary or such predecessor entity with respect to any such period.
"Temporary Cash Investments" means any of the following: (i)
any investment in direct obligations of the United States of America or any
agency thereof or obligations Guaranteed by the United States of America or any
agency thereof, in each case, maturing within 360 days of the date of
acquisition thereof, (ii) investments in time deposit accounts, certificates of
deposit and money market deposits maturing within 180 days of the date of
acquisition thereof issued by a bank or trust company (including the Trustee)
which is organized under the laws of the United States of America, any state
thereof or any foreign country recognized by the United States having capital,
surplus and undivided profits aggregating in excess of $250,000,000 and whose
debt is rated "A" (or such similar equivalent rating) or higher by at least one
nationally recognized statistical rating organization (as defined for purposes
of Rule 436 under the Securities Act) or any money-market fund sponsored by any
registered broker dealer or mutual fund distributor, (iii) repurchase
obligations with a term of not more than 30 days for underlying securities of
the types described in clause (i) above entered into with a nationally
recognized broker-dealer, (iv) investments in commercial paper, maturing not
more than 90 days after the date of acquisition, issued by a corporation (other
than an Affiliate or Subsidiary of Holdings or the Issuer) organized and in
existence under the laws of the United States of America or any foreign country
recognized by the United States of America with a
22
rating at the time as of which any investment therein is made of "P-2" (or
higher) according to Moody's or "A-2" (or higher) according to S&P and (v)
securities with maturities of six months or less from the date of acquisition
backed by standby or direct pay letters of credit issued by any bank satisfying
the requirements of clause (ii) above.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
ss.ss.77aaa-77bbbb) as in effect on the Issue Date except as required by
Section 9.03 hereof; provided, however, that in the event the TIA is amended
after such date, "TIA" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"Transactions" means the Refinancing Transactions, the Golden
State Acquisition and the Escrow Corp. Merger.
"Trustee" means the party named as such in this Indenture
until a successor replaces it and, thereafter, means the successor. If at any
time there is more than one such Person, "Trustee" as used with respect to
Securities of any series shall mean the Trustee with respect to Securities of
that series.
"Trust Officer" means any officer or assistant officer of the
Trustee assigned by the Trustee to administer its corporate trust matters.
"Uniform Commercial Code" means the New York Uniform
Commercial Code as in effect from time to time.
"Unrestricted Affiliate" means a Person (other than a
Subsidiary of Holdings) controlled (as defined in the definition of "Affiliate")
by Holdings, in which no Affiliate of Holdings (other than (x) a Wholly Owned
Subsidiary, (y) a Permitted Affiliate and (z) another Unrestricted Affiliate)
has an Investment.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable at the issuer's option.
"Voting Stock" of a Person means all classes of Capital Stock
or other interests (including partnership interests but, in the case of the
Bank, excluding any CALGZs and CALGLs) of such Person then outstanding and
normally entitled (without regard to any contingency) to vote in the election of
directors, managers or trustees thereof.
"Wholly Owned Subsidiary" means the Bank and any Subsidiary of
Holdings all the Capital Stock of which (other than directors' qualifying
shares, Bank
23
Preferred Stock or Qualified Preferred Stock) is owned by Holdings, the Bank or
another Wholly Owned Subsidiary thereof or any combination of the foregoing.
SECTION 1.02. Other Definitions.
Defined in
Term Section
---- ----------
"Bankruptcy Law".............................................. 6.01
"covenant defeasance option".................................. 8.01(b)
"Custodian"................................................... 6.01
"Default Amount".............................................. 6.02
"Event of Default............................................. 6.01
"legal defeasance option"..................................... 8.01(b)
"New Holding Company"......................................... 4.10
"OTS"......................................................... 4.04
"Outstanding"................................................. 2.11
"Paying Agent"................................................ 2.06
"Registrar"................................................... 2.06
"Security Register" .......................................... 2.06
SECTION 1.03. Incorporation by Reference of Trust Indenture
Act. Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"default" means any Default or Event of Default.
"indenture securities" means the Securities.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Issuer and an
other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by SEC rule have
the meanings assigned to them by such definitions.
24
SECTION 1.04. Rules of Construction. Unless the context
otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP and all accounting calculations
will be determined in accordance with such principles;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural and words in the
plural include the singular;
(6) unsecured debt shall not be deemed to be subordinate or
junior to secured debt merely by virtue of its nature as unsecured
debt;
(7) the principal amount of any noninterest bearing or other
discount security at any date of Issuance shall be the principal amount
thereof that would be shown on a balance sheet of the issuer dated such
date prepared in accordance with GAAP and accretion of principal on
such security shall be deemed to be the Issuance of Debt; provided,
however, that the accretion of principal on such security shall not be
deemed to be the Issuance of Debt if the issuer elects, at the time of
original Issuance of such security, to treat such accretion as if, on
such date of original Issuance, there were an additional Issuance of
Debt in an aggregate principal amount equal to the excess of the
principal amount at maturity of such security over the principal amount
thereof that would be shown on a balance sheet of the issuer dated such
date prepared in accordance with GAAP (except to the extent otherwise
provided in the definition of Permitted Refinancing Debt), and, unless
repaid or redeemed, the amount of such additional Issuance of Debt
shall be treated as being outstanding for all purposes under this
Indenture until such security is paid in full; and
(8) the principal amount of any Preferred Stock shall be (i)
the maximum liquidation value of such Preferred Stock or (ii) the
maximum mandatory redemption or mandatory repurchase price with respect
to such Preferred Stock, whichever is greater.
25
ARTICLE II
The Securities
SECTION 2.01. Form of Securities. (a) The Securities shall
have such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon, as may be required to comply with the rules of any securities exchange,
or as may, consistently herewith, be determined by the officers executing such
Securities, as evidenced by their execution of the Securities. Any portion of
the text of any Security may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Security.
The definitive Securities shall be printed, lithographed or
engraved or produced by any combination of these methods on steel engraved
borders or may be produced in any other manner, all as determined by the
officers executing such Securities, as evidenced by their execution of such
Securities, subject, with respect to the Securities of any series, to the rules
of any securities exchange on which such Securities are listed.
(b) Each Security shall be in one of the forms approved from
time to time by or pursuant to a Certified Board Resolution, or established in
one or more indentures supplemental hereto. Prior to the delivery of a Security
to the Trustee for authentication in any form approved by or pursuant to a
Certified Board Resolution, the Issuer shall deliver to the Trustee the
Certified Board Resolution by or pursuant to which such form of Security has
been approved, which Certified Board Resolution shall have attached thereto a
true and correct copy of the form of Security which has been approved thereby
or, if a Certified Board Resolution authorizes a specific officer or officers to
approve a form of Security, a certificate of such officer or officers approving
the form of Security attached thereto. Any form of Security approved by or
pursuant to a Certified Board Resolution must be acceptable as to form to the
Trustee, such acceptance to be evidenced by the Trustee's authentication of
Securities in that form or a certificate signed by a Responsible Officer of the
Trustee and delivered to the Issuer.
26
SECTION 2.02. Form of Trustee's Certificate of Authentication.
The form of Trustee's Certificate of Authentication for any Security issued
pursuant to this Indenture shall be substantially as follows:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
Dated: By:
---------------------------- ------------------------------
Authorized Signatory
SECTION 2.03. General Limitations; Issuable in Series; Terms
of Particular Series. The aggregate principal amount of Securities which may be
authenticated and delivered and Outstanding under this Indenture is not limited.
The Securities may be issued in one or more series as from
time to time may be authorized by the Board of Directors of the Issuer. There
shall be established in or pursuant to a Certified Board Resolution or in a
supplemental indenture, subject to Section 2.15, prior to the issuance of
Securities of any such series:
(1) the title of the Securities of such series (which shall
distinguish the Securities of such series from Securities of any other
series);
(2) the Person to whom any interest on a Security of such
series shall be payable, if other than the Person in whose name that
Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest;
(3) the date or dates on which the principal of the Securities
of such series is payable;
(4) the rate or rates at which the Securities of such series
shall bear interest, if any, the date or dates from which such interest
shall accrue, the Interest Payment Dates on which any such interest
shall be payable and the Regular Record Date for any interest payable
on any Interest Payment Date;
(5) the place or places where the principal of and any premium
and interest on Securities of such series shall be payable;
27
(6) the period or periods within which the redemption price or
prices or the Repayment price or prices, as the case may be, at which,
and the terms and conditions upon which, Securities of such series may
be redeemed or repaid, as the case may be, in whole or in part, at the
option of the Issuer or the Holder;
(7) the obligation, if any, of the Issuer to purchase
Securities of such series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or
periods within which, the price or prices at which and the terms and
conditions upon which Securities of such series shall be purchased, in
whole or in part, pursuant to such obligation;
(8) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of such series
shall be issuable;
(9) the obligation, if any, of the Issuer to permit the
conversion of the Securities of such series into the Issuer's Common
Stock or Preferred Stock, as the case may be, and the terms and
conditions upon which such conversion shall be effected (including,
without limitation, the initial conversion price or rate, the
conversion period, any adjustment of the applicable conversion price
and any requirements relative to the reservation of such shares for
purposes of conversion);
(10) if other than U.S. dollars, the currency or currencies or
units based on or related to currencies in which the Securities of such
series shall be denominated and in which payments of principal of, and
any premium and interest on, such Securities shall or may be payable;
(11) if the principal of (and premium, if any) or interest, if
any, on the Securities of such series are to be payable, at the
election of the Issuer or a Holder thereof, in a coin or currency
(including a composite currency) other than that in which the
Securities are stated to be payable, the period or periods within
which, and the terms and conditions upon which, such election may be
made;
(12) if the amount of payments of principal of (and premium,
if any) or interest, if any, on the Securities of such series may be
determined with reference to an index based on a coin or currency
(including a composite currency) other than that in which the
Securities are stated to be payable, the manner in which such amounts
shall be determined;
(13) any limit upon the aggregate principal amount of the
Securities of such 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 such series pursuant to
28
Section 2.09, 2.10, 2.12, 3.07 and 9.05 and except for any Securities
which, pursuant to Section 2.05, are deemed never to have been
authenticated and delivered hereunder);
(14) provisions, if any, with regard to the exchange of
Securities of such series, at the option of the Holders thereof, for
other Securities of the same series of the same aggregate principal
amount or of a different authorized series or different authorized
denomination or denominations, or both;
(15) provisions, if any, with regard to the appointment by the
Trustee of an authenticating agent in one or more places other than the
location of the office of the Trustee with power to act on behalf of
the Trustee and subject to its direction in the authentication and
delivery of the Securities of any one or more series in connection with
such transactions as shall be specified in the provisions of this
Indenture or in or pursuant to such Certified Board Resolution or
supplemental indenture;
(16) the portion of the principal amount of Securities of the
series, if other than the principal amount thereof, which shall be
payable upon declaration of acceleration of the Stated Maturity thereof
pursuant to Section 6.02 or provable in bankruptcy pursuant to Section
6.09;
(17) any Event of Default with respect to the Securities of
such series, if not set forth herein, and any additions, deletions or
other changes to the Events of Default set forth herein that shall be
applicable to the Securities of such series;
(18) any covenant solely for the benefit of the Securities of
such series and any additions, deletions or other changes to the
provisions of Article IV or V or Section 1.01 or any definitions
relating to such Articles that would otherwise be applicable to the
Securities of such series;
(19) if Section 8.01(b) of this Indenture shall not be
applicable to the Securities of such series and if Section 8.01(b)
shall be applicable to any covenant or Event of Default established in
or pursuant to a Certified Board Resolution or in a supplemental
indenture as described above that has not already been established
herein;
(20) if the Securities of such series shall be issued in whole
or in part in the form of a Global Security or Securities, the terms
and conditions, if any, upon which such Global Security or Securities
may be exchanged in whole or in part for other individual Securities in
definitive registered form; the Depository for such Global Security or
Securities; and the form of any legend or legends to be borne by any
such Global Security or Securities; and
29
(21) any other terms of such series;
all upon such terms as may be determined in or pursuant to such Certified Board
Resolution or supplemental indenture with respect to such series.
The form of the Securities of each series shall be established
pursuant to the provisions of this Indenture in or pursuant to the Certified
Board Resolution or in the supplemental indenture creating such series. The
Securities of each series shall be distinguished from the Securities of each
other series in such manner, reasonably satisfactory to the Trustee, as the
Board of Directors may determine.
Unless otherwise provided with respect to Securities of a
particular series, the Securities of any series may only be issuable in
registered form, without coupons.
Any terms or provisions in respect of the Securities of any
series issued under this Indenture may be determined pursuant to this Section by
providing for the method by which such terms or provisions shall be determined.
SECTION 2.04. Denominations. The Securities of each series
shall be issuable in such denominations and currency as shall be provided in the
provisions of this Indenture or in or pursuant to the Certified Board Resolution
or the supplemental indenture creating such series. In the absence of any such
provisions with respect to the Securities of any series, the Securities of that
series shall be issuable only in fully registered form in denominations of
$1,000 and any integral multiple thereof.
SECTION 2.05. Execution and Authentication. Two Officers
shall sign the Securities for the Issuer by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds
that office at the time the Trustee authenticates the Security, the Security
shall be valid nevertheless.
At any time and from time to time after the execution and
delivery of this Indenture, the Issuer may deliver Securities executed by the
Issuer to the Trustee for authentication; and the Trustee shall, upon Issuer
Order, authenticate and deliver such Securities as in this Indenture provided
and not otherwise.
Prior to any such authentication and delivery, the Trustee
shall be entitled to receive, in addition to any Officers' Certificate and
Opinion of Counsel required to be furnished to the Trustee pursuant to Sections
10.04 and 10.05, and the Certified Board Resolution and any certificate relating
to the issuance of the series of Securities if required to be furnished pursuant
to Section 2.01(b), an Opinion of Counsel stating that the form and terms of
such Securities have been established in
30
conformity with the provisions of this Indenture, and such other matters as the
Trustee may reasonably request.
The Trustee shall not be required to authenticate such
Securities if the issue thereof will adversely affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture.
Unless otherwise provided in the form of Security for any
series, all Securities shall be dated the date of their authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein or in the applicable Certified Board Resolution or supplemental indenture
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered hereunder
but never issued and sold by the Issuer, and the Issuer shall deliver such
Security to the Trustee for cancellation as provided in Section 2.13, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Issuer to authenticate the Securities. Unless limited by the
terms of such appointment, an authenticating agent may authenticate Securities
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as any Registrar, Paying Agent or agent
for service of notices and demands. The Issuer agrees to pay to any
authenticating agent compensation for its services hereunder.
SECTION 2.06. Registrar and Paying Agent. The Issuer shall
maintain an office or agency where Securities, or Securities of a particular
series, may be presented for registration of transfer or for exchange (the
"Registrar") and an office or agency where Securities, or Securities of such
series, may be presented for payment (the "Paying Agent"). The Registrar shall
keep a register (herein sometimes referred to as the "Security Register") of the
Securities, or Securities of a particular series, and of their transfer and
exchange. There shall be only one Security Register for each series of
Securities. The Issuer may have one or more co-registrars and one or more
additional paying agents. The term "Paying Agent" shall include any additional
paying agent.
The Issuer shall enter into an appropriate agency agreement
with any Registrar, Paying Agent or co-registrar not a party to this Indenture,
which shall incorporate the terms of the TIA. The agreement shall implement the
provisions of
31
this Indenture that relate to such agent. The Issuer shall notify the Trustee of
the name and address of any such agent. If the Issuer fails to maintain a
Registrar or Paying Agent, the Trustee shall act as such and shall be entitled
to appropriate compensation therefor pursuant to Section 7.07. The Issuer or any
of its domestically incorporated Wholly Owned Subsidiaries may act as Paying
Agent, Registrar, co-registrar or transfer agent.
The Issuer hereby initially appoints the Trustee as Registrar
and Paying Agent in connection with the Securities.
SECTION 2.07. Paying Agent To Hold Money in Trust. On or prior
to each due date of the Principal and interest on any Security of any series,
the Issuer shall deposit with the Paying Agent a sum sufficient to pay such
Principal and interest when so becoming due. The Issuer shall require each
Paying Agent (other than the Trustee) to agree in writing that the Paying Agent
shall hold in trust for the benefit of Holders or the Trustee all money held by
the Paying Agent for the payment of Principal of or interest on the Securities
of such series and shall notify the Trustee of any default by the Issuer in
making any such payment. If the Issuer or a Subsidiary acts as Paying Agent, it
shall segregate the money held by it as Paying Agent and hold it as a separate
trust fund. The Issuer at any time may require a Paying Agent to pay all money
held by it to the Trustee and to account for any funds disbursed by the Paying
Agent. Upon complying with this Section, the Paying Agent shall have no further
liability for the money delivered to the Trustee.
SECTION 2.08. Holder Lists. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Holders of Securities of each series. If the
Trustee is not the Registrar with respect to any series, the Issuer shall
furnish to the Trustee, in writing at least five Business Days before each
Interest Payment Date for such series and at such other times as the Trustee may
request in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of Holders of Securities of such
series.
SECTION 2.09. Transfer and Exchange. Upon surrender for
registration of transfer of any Security of any series to the Registrar or a
co-registrar, the Issuer shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of such series of any authorized denominations, of a like
aggregate principal amount and Stated Maturity and of like tenor and terms. When
any Security of any series is presented to the Registrar or a co-registrar with
a request to register a transfer, the Registrar shall register the transfer as
requested if the requirements of Section 8-401(1) of the Uniform Commercial Code
(or any successor provisions, as applicable) are met.
At the option of the Holder, Securities of any series may be
exchanged for other Securities of such series of any authorized denominations,
of a like
32
aggregate principal amount and Stated Maturity and of like tenor and terms, upon
surrender to the Registrar or a co-registrar of the Securities to be exchanged.
Whenever any Securities are so surrendered for exchange, the Issuer shall
execute, and the Trustee shall authenticate and deliver, the Securities which
the Securityholder making the exchange is entitled to receive. When Securities
of any series are presented to the Registrar or a co-registrar with a request to
exchange them, the Registrar shall make the exchange as requested if the
requirements of Section 8-401(1) of the Uniform Commercial Code (or any
successor provisions, as applicable) are met.
Every Security presented or surrendered for registration of
transfer or exchange shall (if so required by the Issuer or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Issuer and the Trustee duly executed, by the Holder thereof
or his attorney duly authorized in writing.
Unless otherwise provided in the Security to be registered for
transfer or exchanged, no service charge shall be made on any Securityholder for
any registration of transfer or exchange of Securities. The Issuer may (unless
otherwise provided in such Security) require payment of a sum sufficient to pay
all taxes, assessments or other governmental charges in connection with any
transfer or exchange pursuant to this Section.
The Issuer shall not be required (i) to issue, register the
transfer of or exchange any Security of any series during a period beginning at
the opening of business 15 days before the day of the mailing of a notice of
redemption of Securities of such series selected for redemption and ending at
the close of business on the date of such mailing, or (ii) to register the
transfer of or exchange any Security so selected for redemption in whole or in
part.
Prior to the due presentation for registration of transfer of
any Security, the Issuer, the Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the Person in whose name a Security is
registered as the absolute owner of such Security for the purpose of receiving
payment of Principal of and interest on such Security and for all other purposes
whatsoever, whether or not such Security is overdue, and none of the Issuer, the
Trustee, the Paying Agent, the Registrar or any co-registrar shall be affected
by notice to the contrary.
All Securities issued upon any transfer or exchange pursuant
to this Section 2.09 will evidence the same debt and shall be entitled to the
same benefits under this Indenture as the Securities surrendered upon such
transfer or exchange.
None of the Issuer, the Trustee, any agent of the Trustee, any
Paying Agent or the Registrar will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests of a
33
Global Security or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
SECTION 2.10. Replacement Securities. If a mutilated Security
is surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost, destroyed or wrongfully taken, the Issuer shall issue
and the Trustee shall authenticate a replacement Security of like tenor, series,
Stated Maturity and principal amount if the requirements of Section 8-405 of the
Uniform Commercial Code (or any successor provisions, as applicable) are met and
the Holder satisfies any other reasonable requirements of the Trustee. If
required by the Trustee or the Issuer, such Holder shall furnish an indemnity
bond sufficient in the judgment of the Issuer and the Trustee to protect the
Issuer, the Trustee, the Paying Agent, the Registrar and any co-registrar from
any loss which any of them may suffer if a Security is replaced. The Issuer and
the Trustee may charge the Holder for their expenses in replacing a Security.
In case any such mutilated, destroyed, lost or stolen Security
has become due and payable, the Issuer, in its discretion, may, instead of
issuing a new Security, pay such Security.
Every new Security issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Issuer, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of the same series duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 2.11. Outstanding Securities. Securities outstanding
("Outstanding") at any time are all Securities authenticated and delivered by
the Trustee except for those canceled by it, those delivered to it for
cancellation and those described in this Section as not Outstanding. A Security
does not cease to be Outstanding because the Issuer or an Affiliate of the
Issuer holds the Security.
If a Security is paid or replaced pursuant to Section 2.10, it
shall cease to be Outstanding unless the Trustee and the Issuer receive proof
satisfactory to them that the replaced Security is held by a bona fide
purchaser.
If the Paying Agent segregates and holds in trust, in
accordance with this Indenture, on a redemption date or maturity date money
sufficient to pay all Principal and interest payable on that date with respect
to the Securities of a particular series (or portions thereof) to be redeemed or
maturing, as the case may be, then on
34
and after that date such Securities of such series (or portions thereof) cease
to be Outstanding and interest on them ceases to accrue.
SECTION 2.12. Temporary Securities. Until definitive
Securities of any series are ready for delivery, the Issuer may execute and upon
receipt of the documents required by Section 2.05, together with an Issuer
Order, the Trustee shall authenticate and deliver temporary Securities.
Temporary Securities shall be substantially in the form of definitive Securities
but may have variations that the Issuer considers appropriate for temporary
Securities. Without unreasonable delay, the Issuer shall execute and the Trustee
shall authenticate definitive Securities of such series and deliver them in
exchange for temporary Securities upon surrender of such temporary Securities of
such series at the office or agency of the Issuer, without charge to the Holder.
SECTION 2.13. Cancellation. The Issuer at any time may deliver
Securities to the Trustee for cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel
Securities surrendered for registration of transfer, exchange, payment or
cancellation and deliver such canceled Securities to the Issuer upon the
Issuer's written request. The Issuer may not Issue new Securities to replace
Securities it has redeemed, paid or delivered to the Trustee for cancellation
unless otherwise provided with respect to such Securities pursuant to Section
2.03.
SECTION 2.14. Payment of Interest; Defaulted Interest. Unless
otherwise provided with respect to such Security pursuant to Section 2.03,
interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest.
If the Issuer defaults in a payment of interest on the
Securities of any series, the Issuer shall pay defaulted interest (plus interest
on such defaulted interest to the extent lawful) in any lawful manner. The
Issuer may pay the defaulted interest to the Persons who are Holders of the
Securities of such series on a subsequent special record date, which date shall
be at least five Business Days prior to the payment date. The Issuer shall fix
or cause to be fixed any such special record date and payment date, and, at
least 15 days before any such special record date, the Issuer shall mail to each
Holder of Securities of such series a notice that states the special record
date, the payment date and the amount of defaulted interest to be paid.
If any installment of interest the Interest Payment Date for
which is on or prior to the redemption date for any Security called for
redemption pursuant to Article III is not paid or duly provided for on or prior
to the redemption date in
35
accordance with the foregoing provisions of this Section, such interest shall be
payable as part of the redemption price of such Securities.
Subject to the foregoing provisions of this Section and unless
otherwise provided with respect to any Securities pursuant to Section 2.03, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
SECTION 2.15. Delayed Issuance of Securities. Notwithstanding
any contrary provision herein, if all Securities of a series are not to be
originally issued at one time, it shall not be necessary for the Issuer to
deliver to the Trustee an Officers' Certificate, Certified Board Resolution,
supplemental indenture, opinion of counsel or Issuer Order otherwise required
pursuant to Sections 2.01(b), 2.03, 2.05 and 10.04 at or prior to the time of
authentication of each Security of such series if such documents are delivered
to the Trustee or its agent at or prior to the authentication upon original
issuance of the first Security of such series to be issued; provided that any
subsequent request by the Issuer to the Trustee to authenticate Securities of
such series upon original issuance shall constitute a representation and
warranty by the Issuer that as of the date of such request, the statements made
in the Officers' Certificate or other certificates delivered pursuant to
Sections 2.01(b) and 10.04 shall be true and correct as if made on such date.
An Issuer Order, Officers' Certificate or Certified Board
Resolution or supplemental indenture delivered by the Issuer to the Trustee in
the circumstances set forth in the preceding paragraph may provide that
Securities which are the subject thereof will be authenticated and delivered by
the Trustee or its agent on original issue from time to time in the aggregate
principal amount, if any, established for such series pursuant to such
procedures acceptable to the Trustee as may be specified from time to time by
Issuer Order upon the telephonic, electronic or written order of Persons
designated in such Issuer Order, Officers' Certificate, supplemental indenture
or Certified Board Resolution (any such telephonic or electronic instructions to
be promptly confirmed in writing by such Persons) and that such Persons are
authorized to determine, consistent with such Issuer Order, Officers'
Certificate, supplemental indenture or Certified Board Resolution, such terms
and conditions of said Securities as are specified in such Issuer Order,
Officers' Certificate, supplemental indenture or Certified Board Resolution.
SECTION 2.16. CUSIP Numbers. The Issuer in issuing Securities
of any series 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
Holders; provided, however, 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
36
other identification numbers printed on the Securities, and any such redemption
shall not be affected by any defect in or omission of such numbers.
ARTICLE III
Redemption
SECTION 3.01. Applicability of Article. The Issuer may reserve
the right to redeem and pay before Stated Maturity all or any part of the
Securities of any series, either by optional redemption, sinking or purchase
fund or analogous obligation or otherwise, by provision therefor in the form of
Security for such series established and approved pursuant to Section 2.01(b)
and on such terms as are specified in such form or in the indenture supplemental
hereto with respect to Securities of such series as provided in Section 2.03.
Redemption of Securities of any series shall be made in accordance with the
terms of such Securities and, to the extent that this Article does not conflict
with such terms, the succeeding Sections of this Article.
SECTION 3.02. Election to Redeem; Notices to Trustee. If the
Issuer elects to redeem Securities or is required to redeem Securities, it shall
notify the Trustee in writing of such election, the redemption date, the
Principal amount of Securities and the series to be redeemed and the paragraph
of the Securities of such series pursuant to which the redemption will occur. If
the Issuer is required to redeem any of the Initial Securities the Issuer shall
also notify the Escrow Agent concurrently with its notification of the Trustee.
The Issuer shall give each notice to the Trustee provided for
in this Section at least 60 days before the redemption date, or if the Issuer is
required to redeem Securities, promptly after the occurrence of the event
requiring such redemption, unless the Trustee consents to a shorter period. In
the case of any redemption of Securities (i) prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or
elsewhere in this Indenture, or (ii) pursuant to an election of the Issuer which
is subject to a condition specified in the terms of such Securities, the Issuer
shall furnish the Trustee with an Officers' Certificate evidencing compliance
with such restriction or condition. If fewer than all the Securities of any
series are to be redeemed, the record date relating to such redemption for
determining the Holders to whom notice of redemption will be sent pursuant to
Section 3.04 shall be selected by the Issuer and given to the Trustee, which
record date shall be not less than 15 days after the date of notice to the
Trustee unless the Trustee consents to a shorter period.
SECTION 3.03. Selection of Securities To Be Redeemed. If less
than all the Securities of any series issued on the same day with the same terms
are to be redeemed, the particular Securities to be redeemed shall be selected
not more than
37
60 days prior to the redemption date by the Trustee, from the Outstanding
Securities of such series issued on such date with the same terms not previously
called for redemption pro rata, by lot, or by such other method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of portions (equal to the minimum authorized denomination for
Securities of that series or any integral multiple thereof) of the principal
amount of Securities of such series of a denomination larger than the minimum
authorization denomination for Securities of that series.
The Trustee shall promptly notify the Company and the Security
Registrar (if other than itself) in writing of the Securities selected for
redemption and, in the case of any Securities selected for partial redemption,
the principal amount thereof to be redeemed.
Securities shall be excluded from eligibility for selection
for redemption if they are identified by registration and certificate number in
a written statement signed by an authorized officer of the Issuer and delivered
to the Trustee at least 60 days prior to the redemption date as being owned of
record and beneficially by, and not pledged or hypothecated by either, (a) the
Issuer or (b) an entity specifically identified in such written statement as
being an Affiliate of the Issuer.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Security redeemed or to be redeemed only in
part, to the portion of the Principal amount of such Security which has been or
is to be redeemed.
SECTION 3.04. Notice of Redemption. At least 30 (or such
shorter period if so provided in the supplemental indenture or Certified Board
Resolution establishing the relevant series) days but not more than 60 days
before a date for redemption of Securities, the Issuer shall mail or cause to be
mailed a notice of redemption by first-class mail to each Holder of Securities
to be redeemed at his address appearing in the Security Register.
The notice shall identify the Securities to be redeemed and
shall state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered
to the Paying Agent to collect the redemption price;
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(5) if fewer than all the Outstanding Securities of any series
are to be redeemed, the identification of the particular Securities to
be redeemed as well as the aggregate Principal amount of Securities to
be redeemed and, if any Security is being redeemed in part, the portion
of the Principal amount of such Security to be redeemed and that after
the redemption date and upon surrender of such Security a new Security
or Securities of the same series will be issued having a Principal
amount equal to the Principal amount of the Security surrendered less
the Principal amount of the portion of the Security redeemed;
(6) that, unless the Issuer defaults in making such redemption
payment, interest on the Securities (or portion thereof) called for
redemption ceases to accrue on and after the redemption date;
(7) the paragraph of the Securities pursuant to which the
Securities called for redemption are being redeemed;
(8) the CUSIP number, if any, printed on the Securities being
redeemed; and
(9) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed
on the Securities.
At the Issuer's request, the Trustee shall give the notice of
redemption in the Issuer's name and at the Issuer's expense. In such event, the
Issuer shall provide the Trustee with the information required by this Section.
SECTION 3.05. Effect of Notice of Redemption. Once notice of
redemption is mailed, Securities called for redemption become due and payable on
the redemption date and at the redemption price stated in the notice and from
and after such date (unless the Issuer shall default in the payment of all or
part of the redemption price) cease to bear interest. Upon surrender to the
Paying Agent, such Securities shall be paid at the redemption price stated in
the notice, plus accrued and unpaid interest, if any, to the redemption date.
Failure to give notice or any defect in the notice to any Holder shall not
affect the validity of the notice to any other Holder.
SECTION 3.06. Deposit of Redemption Price. On or prior to the
redemption date, the Issuer shall deposit with the Paying Agent (or, if the
Issuer or a Subsidiary is the Paying Agent, shall segregate and hold in trust)
money sufficient to pay the redemption price of and accrued and unpaid interest
on all Securities to be redeemed on the redemption date, other than Securities
or portions of Securities called for redemption which have been delivered by the
Issuer to the Trustee for cancellation.
39
SECTION 3.07. Securities Redeemed in Part. Upon surrender of a
Security that is redeemed in part (with, if the Issuer and the Trustee so
requires, due endorsement by, or a written instrument of transfer in the form
satisfactory to the Issuer and the Trustee duly executed by, the Holder thereof
or his attorney duly authorized in writing), the Issuer shall execute and the
Trustee shall authenticate and deliver to the Holder (at the Issuer's expense) a
new Security or Securities of the same series of any authorized denomination as
requested by such Holder in aggregate Principal amount equal to the Principal
amount of the Security surrendered less the Principal amount of the portion of
the Security so redeemed.
ARTICLE IV
Covenants
SECTION 4.01. Payment of Securities. With respect to each
series of Securities, the Issuer shall promptly pay the Principal of and
interest on such Securities on the dates and in the manner provided in such
Securities and in this Indenture. Principal and interest shall be considered
paid on the date due if on such date the Trustee or the Paying Agent holds in
accordance with this Indenture money sufficient to pay all Principal and
interest then due. The Issuer shall pay interest on overdue Principal and, to
the extent lawful, interest on overdue installments of interest, at the rate
specified therefor in the Securities.
SECTION 4.02. SEC Reports. Notwithstanding that Holdings may
not be required to be subject to the reporting requirements of Section 13 or
15(d) of the Exchange Act, Holdings shall file or cause to be filed with the SEC
and provide the Trustee and Holders with the information, documents and other
reports (or copies of such portions of any of the foregoing as the SEC may by
rules and regulations prescribe) specified in Sections 13 and 15(d) of the
Exchange Act. The Issuer also shall comply with the other provisions of TIA ss.
314(a).
SECTION 4.03. Limitation on Debt. Escrow Corp. shall not Issue
any Debt other than the Initial Securities or any Escrow Debt. Holdings will not
Issue any Debt and Holdings will not permit any Subsidiary to Issue any Debt;
provided, however, that the foregoing shall not prohibit the Issuance of the
following Debt:
(a) the Initial Securities and Exchange Securities;
(b) Debt of Holdings if, immediately after giving effect to
any such Issuance, the aggregate principal amount of Debt (including the
aggregate accreted value as of such date of any Debt Issued at a discount) of
Holdings outstanding would not exceed an amount equal to the Adjusted
Consolidated Net Worth of Holdings;
40
(c) Subordinated Obligations of Holdings if, immediately after
giving effect to any such Issuance, the Fixed Charge Coverage Ratio would be
greater than 3.00 to 1.00; provided, however, that the Subordinated Obligations
so Issued (A) shall not mature prior to the Stated Maturity of all the
Securities outstanding on the date of such Issuance and (B) shall have an
Average Life to their Stated Maturity equal to or greater than the remaining
Average Life to the Stated Maturity of such Securities;
(d) Permitted Refinancing Debt Issued by Holdings to Refinance
Debt Issued pursuant to the foregoing clauses (a), (b) and (c) and clause (i)
below;
(e) any Debt of any Subsidiary of Holdings that is a
Depository Institution or a Subsidiary of such Depository Institution;
(f) in the case of any Financial Services Subsidiary which is
not a Depository Institution or a Subsidiary of a Depository Institution, (x)
any Debt Issued by such Financial Services Subsidiary in the ordinary course of
funding its assets, (y) any additional Debt of such Financial Services
Subsidiary if, immediately after giving effect to the Issuance of such
additional Debt, the aggregate principal amount of Debt (including the aggregate
accreted value as of such date of any Debt Issued at a discount) of such
Financial Services Subsidiary outstanding (other than any Debt described in
clause (x) above) would not exceed an amount equal to the product of 2.0 and the
Adjusted Consolidated Net Worth of such Financial Services Subsidiary, and (z)
any Permitted Refinancing Debt Issued by Holdings, such Subsidiary or a
Subsidiary thereof to Refinance any Debt Issued pursuant to clause (y) above;
(g) Debt of Holdings in an aggregate principal amount not to
exceed $200 million incurred in connection with the Refinancing Transactions
provided that such Debt shall not mature after December 31, 1999;
(h) Debt of a Subsidiary of Holdings Issued and outstanding on
or prior to the date on which such Subsidiary was acquired by Holdings (other
than Debt Issued as consideration in, or to provide all or any portion of the
funds or credit support utilized to consummate, the transaction or series of
related transactions pursuant to which such Subsidiary became a Subsidiary of
Holdings or was acquired by Holdings) and any Permitted Refinancing Debt Issued
by Holdings, such Subsidiary or a Subsidiary thereof to Refinance such Debt;
(i) FNH Notes assumed by Holdings in connection with the
Transactions; or
(j) Permitted Acquisition Debt of Holdings in an aggregate
amount at any time outstanding not in excess of $300 million.
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SECTION 4.04. Limitation on Restricted Payments.
(a) Escrow Corp. shall not, directly or indirectly, make any
Restricted Payment; provided that Escrow Corp. may make Restricted Payments
following a mandatory redemption of all of the Initial Securities pursuant to
the terms thereof. Holdings shall not, and shall not permit any of its
Subsidiaries, directly or indirectly, to, make any Restricted Payment if, at the
time of the making of such Restricted Payment, and after giving effect thereto:
(1) a Default shall have occurred and be continuing (or would
result therefrom); or
(2) the Bank does not qualify as "well capitalized" under
Section 28 of the FDIA (or any successor provision) and the regulations
of the Office of Thrift Supervision ("OTS") thereunder; or
(3) the Consolidated Common Shareholders' Equity of the Bank
as of the end of the most recent fiscal quarter ending at least 45 days
prior to the date of such Restricted Payment would have been less than
the Minimum Common Equity Amount as of the end of such fiscal quarter;
or
(4) the aggregate amount of such Restricted Payment and all
other Restricted Payments declared or made from and after July 1, 1998
would exceed the sum of (without duplication):
(i) 75% (or, in the case of that portion of
Consolidated Net Income of Holdings which is attributable to
the Litigations, 100%) of Holdings' aggregate Consolidated Net
Income (or, if such aggregate Consolidated Net Income is a
deficit, minus 100% of such deficit) since July 1, 1998 to the
end of the most recent fiscal quarter ending at least 45 days
prior to the date of such Restricted Payment;
(ii) the aggregate Net Cash Proceeds from sales of
Capital Stock of Holdings (other than Redeemable Stock or
Exchangeable Stock) or cash capital contributions made to
Holdings and any earnings or proceeds thereof to the extent
invested in Temporary Cash Investments, to the extent
received, made or realized on or after the Issue Date (other
than an issuance or sale to a Subsidiary of Holdings);
(iii) the amount by which Debt of Holdings is reduced
on Holdings' balance sheet on or after the Issue Date upon the
conversion or exchange (other than by a Subsidiary of
Holdings) of Debt of Holdings into Capital Stock (other than
Redeemable Stock or Exchangeable Stock) of Holdings (less the
amount of any cash or other
42
property distributed by Holdings or any Subsidiary of Holdings
upon such conversion or exchange); and
(iv) $320,000,000.
(b) Section 4.04(a) shall not prohibit the following (none of
which shall be included in the calculation of the amount of Restricted Payments,
except to the extent expressly provided in clause (i) below):
(i) dividends paid within 60 days after the date of
declaration thereof, or Restricted Payments made within 60 days after
the making of a binding commitment in respect thereof, if at such date
of declaration or commitment such dividend or other Restricted Payment
would have complied with this Section; provided, however, that, at the
time of payment of such dividend or the making of such Restricted
Payment, no other Default shall have occurred and be continuing (or
would result therefrom); provided further, however, that such dividend
or other Restricted Payment shall be included in the calculation of the
amount of Restricted Payments;
(ii) dividends on, or any purchase, redemption or other
acquisition or retirement for value of, the Bank Preferred Stock or
Qualified Preferred Stock;
(iii) any purchase, repurchase, redemption, defeasance or
other acquisition or retirement for value of Capital Stock or
Subordinated Obligations by exchange for or out of the proceeds from
the substantially concurrent sale of Capital Stock or of a cash capital
contribution; provided, however, that the Net Cash Proceeds from such
sale or such capital contribution, to the extent they are used to
purchase, repurchase, redeem, defease, acquire or retire for value
Capital Stock or Subordinated Obligations, shall be excluded from
Section 4.04(a)(4)(ii);
(iv) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Obligations by
exchange for or out of the proceeds from the substantially concurrent
sale of Subordinated Obligations permitted to be issued under Section
4.03;
(v) any purchase or repurchase of any Subordinated Obligations
pursuant to an option given to a holder of such Subordinated
Obligations pursuant to a "change of control" covenant which is no more
favorable to the holders of such Subordinated Obligations than the
provisions of Section 4.06 are to holders of the Securities as
determined in good faith by the Board of Directors of Holdings, the
determination of which shall be evidenced by a resolution adopted by
such Board of Directors; provided, however, that no such purchase shall
be permitted prior to the time when Holdings shall have
43
purchased all Securities tendered for purchase by holders electing to
have their Securities purchased pursuant to Section 4.06;
(vi) so long as no Default has occurred and is continuing,
amounts paid to Parent, to the extent necessary to enable Parent to pay
actual expenses, other than those paid to Affiliates of Holdings,
incidental to being a publicly reporting, but non-operating, company;
or
(vii) any Restricted Payments to the extent necessary to
consummate the Transactions or to redeem or purchase any Bank Preferred
Stock or FNH Notes not purchased in connection with the Transactions or
to the extent resulting from the Transactions.
(c) Holdings or any Subsidiary of Holdings may take actions to
make a Restricted Payment in anticipation of the occurrence of any of the events
described in Sections 4.04(a) or (b); provided, however, that the making of such
Restricted Payment shall be conditioned upon the occurrence of such event.
SECTION 4.05. Limitation on Transactions with Affiliates.
(a) Escrow Corp. shall not conduct any business or enter into
any transaction or series of similar transactions (including the purchase, sale,
lease or exchange of any property or the rendering of any service) with any
Affiliate of Escrow Corp. or any Affiliated Permitted Holder, except to the
extent necessary to consummate the Transactions.
(b) Holdings shall not, and shall not permit any of its
Subsidiaries to, conduct any business or enter into any transaction or series of
similar transactions (including the purchase, sale, lease or exchange of any
property or the rendering of any service) with any Affiliate of Holdings or any
Affiliated Permitted Holder unless:
(i) the terms of such business, transaction or series of
transactions are (A) set forth in writing and (B) at least as favorable
to Holdings or such Subsidiary as terms that would be obtainable at the
time for a comparable transaction or series of similar transactions in
arm's-length dealings with an unrelated third Person; and
(ii) to the extent that such business, transaction or series
of transactions is known by the Board of Directors of Holdings or such
Subsidiary to involve an Affiliate of Holdings or any Affiliated
Permitted Holder, then:
(A) with respect to a transaction or series of
related transactions involving aggregate payments or other
consideration in excess of $5,000,000, such transaction or
series of related transactions has been
44
approved (and the value of any non-cash consideration has been
determined) by a majority of those members of the Board of
Directors of Holdings or such Subsidiary having no personal
stake in such business, transaction or series of transactions;
and
(B) with respect to a transaction or series of
related transactions involving aggregate payments or other
consideration in excess of $75,000,000 (with the value of any
non-cash consideration being determined by a majority of those
members of the Board of Directors of Holdings or such
Subsidiary having no personal stake in such business,
transaction or series of transactions), such transaction or
series of related transactions has been determined, in the
written opinion of a nationally recognized investment banking
firm, to be fair, from a financial point of view, to Holdings
or such Subsidiary.
(c) The provisions of Section 4.05(b) shall not prohibit:
(i) any Restricted Payment permitted to be paid pursuant to
Section 4.04;
(ii) any transaction between Holdings and any of its
Subsidiaries or between Subsidiaries of Holdings; provided, however,
that no portion of any minority interest in any such Subsidiary is
owned by any Affiliate of Holdings or any Affiliated Permitted Holder
(in each case, other than a Wholly Owned Subsidiary, an Unrestricted
Affiliate or a Permitted Affiliate);
(iii) transactions pursuant to which Mafco Holdings will
provide Holdings and its Subsidiaries at the request of Holdings with
certain allocated services to be purchased from third party providers,
such as legal and accounting services, insurance coverage and other
services;
(iv) any transaction with a Permitted Affiliate entered into
in the ordinary course of business (including compensation or employee
benefit arrangements with any such Permitted Affiliate); provided,
however, that such Permitted Affiliate holds, directly or indirectly,
no more than 5% of the outstanding Capital Stock of Holdings;
(v) any transaction pursuant to the Tax Sharing Agreement;
(vi) any transaction with an Unrestricted Affiliate; and
(vii) any transactions pursuant to the Escrow Corp. Merger
Agreement or otherwise necessary to consummate the Transactions.
45
SECTION 4.06. Change of Control. (a) Upon the occurrence of a
Change of Control, each Holder of Securities of each series with respect to
which this Section 4.06 is applicable shall have the right to require that the
Issuer repurchase all or any part of such Holder's Securities at a repurchase
price in cash equal to 101% of the Principal amount thereof plus accrued and
unpaid interest, if any, to the date of repurchase (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date); provided, however, that notwithstanding the
occurrence of a Change in Control, the Issuer shall not be obligated to purchase
the Securities of any series pursuant to this Section 4.06 in the event that it
has exercised any right it may have to redeem all the Securities of such series
pursuant to the terms thereof.
(b) Within 45 days following any Change of Control, the Issuer
shall mail a notice to each Holder of Securities of each such series (other than
any series with respect to which the Issuer has mailed a notice of redemption)
with a copy to the Trustee stating:
(i) that a Change of Control has occurred and that such Holder
has the right to require the Issuer to repurchase all or any part of
such Holder's Securities of such series at a purchase price in cash
equal to 101% of the Principal amount thereof plus accrued and unpaid
interest, if any, to the date of repurchase (subject to the right of
Holders of record on the relevant record date to receive interest due
on the relevant interest payment date);
(ii) the circumstances and relevant facts regarding such
Change of Control;
(iii) the repurchase date (which shall be no earlier than 30
days nor later than 60 days from the date such notice is mailed); and
(iv) the instructions, determined by the Issuer consistent
with this Section, that a Holder must follow in order to have its
Securities repurchased.
(c) Holders electing to have a Security repurchased will be
required to surrender the Security, with an appropriate form duly completed, to
the Issuer at the address specified in the notice at least 10 Business Days
prior to the repurchase date. Holders will be entitled to withdraw their
election if the Trustee or the Issuer receives not later than three Business
Days prior to the repurchase date, a facsimile transmission or letter setting
forth the name of the Holder, the Principal amount of the Security which was
delivered for purchase by the Holder and a statement that such Holder is
withdrawing his election to have such Security purchased.
(d) On the repurchase date, all Securities repurchased by the
Issuer under this Section shall be delivered to the Trustee for cancellation,
and the Issuer shall pay the repurchase price to the Holders entitled thereto.
Upon surrender of a
46
Security that is repurchased under this Section in part, the Issuer shall
execute and the Trustee shall authenticate for the Holder thereof (at the
Issuer's expense) a new Security of the same series having a Principal amount
equal to the Principal amount of the Security surrendered less the portion of
the Principal amount of the Security repurchased.
(e) The Issuer shall comply, to the extent applicable, with
the requirements of Section 14(e) of the Exchange Act and any other applicable
securities laws or regulations in connection with the repurchase of Securities
pursuant to this Section. To the extent that the provisions of any securities
laws or regulations conflict with provisions of this Section, the Issuer shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligation under this Section by virtue thereof.
SECTION 4.07. Limitation on Other Business Activities of
Escrow Corp. Prior to the Escrow Corp. Merger, Escrow Corp. shall not engage in
any trade or business other than the original issuance of the Initial Securities
under this Indenture and any such activities as are specifically required
pursuant to this Indenture, such Securities, the Escrow Agreement, the
Registration Agreement referred to in the supplemental indentures pursuant to
which the Initial Securities were Issued, and the Escrow Corp. Merger Agreement
and any activities directly related thereto and will not own any Investment
(other than Temporary Cash Investments) in any other Person.
SECTION 4.08. Limitations on Restrictions on Distributions by
Subsidiaries. Holdings shall not, and shall not permit any Subsidiary of
Holdings to, suffer to exist any consensual encumbrance or restriction on the
ability of any Subsidiary of Holdings (i) to pay, directly or indirectly,
dividends or make any other distributions in respect of its Capital Stock or to
pay any Debt owed to Holdings; (ii) to make loans or advances to Holdings; or
(iii) to transfer any of its property or assets to Holdings, except, in any such
case, any encumbrance or restrictions:
(a) pursuant to any agreement in effect or entered into on the
Issue Date or in connection with the Transactions;
(b) pursuant to an agreement in effect or entered into by such
Subsidiary prior to the date on which such Subsidiary was acquired by Holdings
(other than an agreement in respect of Debt Issued as consideration in, or to
provide all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant to which
such Subsidiary became a Subsidiary or was acquired by Holdings and other than
any agreement entered into in anticipation of the acquisition of such Subsidiary
by Holdings) and outstanding on such date;
47
(c) pursuant to an agreement effecting a Refinancing of Debt
or Preferred Stock Issued pursuant to an agreement referred to in clause (a) or
(b) above or this clause (c) or contained in any amendment to an agreement
referred to in clauses (a) and (b) or this clause (c); provided, however, that
the provisions contained in such Refinancing agreement or in such amendment
relating to such encumbrance or restriction are no more restrictive than the
provisions contained in the agreement which is the subject of such Refinancing
or amendment, as determined in good faith by the Board of Directors of Holdings
and evidenced by a resolution adopted by such Board;
(d) any encumbrance or restriction (A) that restricts in a
customary manner the subletting, assignment or transfer of any property or asset
that is a lease, license, conveyance or contract or similar property or asset,
(B) by virtue of any transfer of, agreement to transfer, option or right with
respect to, or Lien on, any property or assets of Holdings or any Subsidiary of
Holdings not otherwise prohibited by this Indenture or (C) arising or agreed to
in the ordinary course of business and that does not, individually or in the
aggregate, detract from the value of property or assets of Holdings or any
Subsidiary of Holdings in any manner material to Holdings or such Subsidiary;
(e) restrictions contained in security agreements securing
Debt of Holdings or any Subsidiary of Holdings to the extent such restrictions
restrict the transfer of the collateral covered by such security agreements or,
upon default, restrict the payment of dividends or distributions on Capital
Stock, and restrictions contained in agreements relating to a disposition of
property or Capital Stock of any Subsidiary, to the extent such restrictions
restrict the transfer of the property or Capital Stock subject to such
agreements;
(f) any encumbrance or restriction relating to a Financial
Services Subsidiary contained in an agreement providing for or relating to the
Issuance of Debt by such Subsidiary pursuant to Section 4.03(f);
(g) any encumbrance or restriction imposed by, or otherwise
agreed to with, any governmental agency having regulatory supervision over the
Bank or any other Subsidiary of Holdings; and
(h) pursuant to the terms of any Qualified Preferred Stock
issued after the Issue Date.
SECTION 4.09. Limitation on Liens. Escrow Corp. shall not
create or permit to exist any Lien on any of its property or assets, whether
owned on the date of this Indenture or thereafter acquired, securing any
obligations of Escrow Corp. except to the extent provided in the Escrow
Agreement. Holdings shall not create or permit to exist any Lien on any of its
property or assets (including Capital Stock), whether owned on the date of this
Indenture or thereafter acquired, securing
48
any Debt of Holdings without making effective provision to secure the Securities
then outstanding (and, if the Issuer so elects, any other Debt ranking pari
passu with such Securities) equally and ratably with or prior to such Debt with
a Lien on the assets securing such Debt for so long as such Debt is secured by
such Lien.
SECTION 4.10. Limitation on Sale of Capital Stock of, and
Merger or Sale of Assets by, the Bank. (a) Except in the case of the
Transactions, Holdings shall not, and shall not permit the Bank to, issue, sell,
transfer, assign or otherwise dispose of any shares of Voting Stock or Common
Stock of the Bank, or any securities convertible into or exchangeable for shares
of Voting Stock or Common Stock of the Bank, unless after giving effect to such
transaction and to shares issuable upon conversion or exchange of outstanding
securities convertible into or exchangeable for shares of such Voting Stock or
Common Stock (including such securities, if any, which may be the subject of
such transaction) at least 80% of the Voting Stock and Common Stock of the Bank
will be owned at that time by Holdings or a person who expressly assumes by
supplemental indenture all the obligations of the Issuer under this Indenture
and the Securities ("New Holding Company") or any Wholly Owned Subsidiary of
Holdings or of a New Holding Company.
(b) Except in the case of the Transactions, Holdings shall not
permit the Bank to merge or consolidate or convey or transfer all or
substantially all its assets unless at least 80% of the Voting Stock and Common
Stock (after giving effect to such transaction and to shares issuable upon
conversion or exchange of outstanding securities convertible into or
exchangeable for shares of such Voting Stock or Common Stock, including such
securities, if any, which may be issued in such transaction) of the resulting or
surviving corporation in the case of a merger or consolidation or of the
transferee corporation in the case of a conveyance or transfer will be owned at
that time by Holdings or a New Holding Company or any Wholly Owned Subsidiary of
Holdings or of a New Holding Company.
(c) For purposes of Section 4.10(b) the phrase "convey or
transfer all or substantially all its assets" in respect of the Bank means to
convey or transfer in a single transaction or in a series of related
transactions, in either case occurring outside the ordinary course of business,
more than 75% of the assets and 75% of the deposit liabilities of the Bank in
each case as shown on a consolidated balance sheet of the Bank as of the end of
the most recent fiscal quarter ending at least 45 days prior to such transaction
(or the first transaction in any such related series of transactions); provided,
however, that in the case of such a conveyance or transfer, if Holdings at any
time holds any assets other than (1) the Capital Stock of the Bank, (2)
Temporary Cash Investments and (3) Permitted Investments described in clause
(ii) of the definition thereof, such other assets shall be deemed to be assets
of the Bank and to have been reflected on such consolidated balance sheet.
(d) Notwithstanding the foregoing, Holdings may engage in a
transaction otherwise prohibited by Section 4.10(a) or (b) if prior to any such
49
transaction the Bank unconditionally guarantees payment when due of the
principal of, premium, if any, and interest on the Securities of each series,
the Bank obtains all regulatory approvals, if any, required to permit such
guarantee, and the Bank obtains an Opinion of Counsel as to the enforceability
of such guarantee.
(e) After consummation of any transaction permitted by Section
4.10(b), the term "Bank" when used in this Indenture and the Securities shall
mean the resulting, surviving or transferee person in such transaction and not
any other entity which previously had been covered by such term. After
consummation of any transaction permitted by Section 4.10(a) or (b) involving a
New Holding Company in which the requirements of Section 5.01(a) are satisfied
with respect to such New Holding Company as if it were the transferee
corporation referred to in Section 5.01(a), the term "Holdings" when used in
this Indenture and the Securities shall mean the New Holding Company in such
transaction and not any other entity which previously had been covered by such
term, and the New Holding Company will be the successor company and will succeed
to, and be substituted for, and may exercise every right and power of, the
Issuer under this Indenture, and thereafter the Issuer will be discharged from
all obligations and covenants under this Indenture and the Securities.
SECTION 4.11. Maintenance of Status of the Bank as an Insured
Depository Institution; Capital Maintenance. (a) Holdings will do or cause to be
done all things necessary to preserve and keep in full force and effect the
status of the Bank as an insured depository institution and do all things
necessary to ensure that deposits of the Bank are insured by the Federal Deposit
Insurance Corporation or any successor organization up to the maximum amount
permitted by 12 U.S.C. ss. 1811 et seq. and the regulations thereunder or any
succeeding federal law, except as to individual accounts or interests in
employee benefit plans that are not entitled to "pass-through" insurance under
12 U.S.C. ss. 1821(a)(1)(D).
(b) Holdings shall cause the Bank to maintain or exceed the
status of an "adequately capitalized" institution as defined in the FDIA and OTS
regulations.
SECTION 4.12. Compliance Certificates. (a) The Issuer shall
deliver to the Trustee within 120 days after the end of each fiscal year of the
Issuer, commencing with the fiscal year ended December 31, 1998, an Officers'
Certificate stating that in the course of the performance by the signers of
their duties as Officers of the Issuer they would normally have knowledge of any
Default by the Issuer and whether or not the signers know of any Default or
Event of Default that occurred during such period. If they do, the certificate
shall describe the Default, its status and what action the Issuer is taking or
proposes to take with respect thereto. The Issuer also shall comply with TIA ss.
314(a)(4).
(b) The Issuer shall deliver to the Trustee, as soon as
possible and in any event within 30 days after the Officers of the Issuer become
aware of the
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occurrence of a Default or Event of Default, an Officers' Certificate setting
forth the details of such Default or Event of Default and the action that the
Issuer proposes to take with respect thereto.
SECTION 4.13. Applicability of Article IV; Investment Grade
Covenant Changes. Except as provided in the next sentence and except as
otherwise provided with respect to any series of Securities in the supplemental
indenture or Certified Board Resolution pursuant to which such series is Issued,
all of the covenants set forth in this Article IV shall be applicable to all
series of Securities. If at any time the Securities of any series are rated
Investment Grade, at the election of the Issuer, each of Sections 4.03, 4.04,
4.07 and 4.08 shall be of no further force and effect in respect of such series
and shall cease to apply to the Issuer, Holdings and, if applicable, its
Subsidiaries in respect of such series.
SECTION 4.14. Waiver of Certain Covenants. The Issuer may omit
in respect of any series of Securities, in any particular instance, to comply
with any covenant or condition set forth in this Article IV (other than Section
4.01) or set forth in a Certified Board Resolution or supplemental indenture
with respect to the Securities of such series, unless otherwise specified in
such Certified Board Resolution or supplemental indenture, if before or after
the time for such compliance the Holders of not less than a majority in
Principal amount of the Outstanding Securities of each series affected by such
waiver shall either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to
or affect such covenant or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the Issuer and
the duties of the Trustee in respect of any such covenant or condition shall
remain in full force and effect. Nothing in this Section 4.14 shall permit the
waiver of compliance with any covenant or condition set forth in such Certified
Board Resolution or supplemental indenture which, if in the form of an indenture
supplemental hereto, would not be permitted by Section 9.02 without the consent
of the Holder of each Outstanding Security affected thereby.
SECTION 4.15. Further Instruments and Acts. Upon request of
the Trustee, the Issuer will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
ARTICLE V
Successor Company
SECTION 5.01. When Holdings and Escrow Corp. May Merge or
Transfer Assets. (a) Except in the case of the Transactions and except as
otherwise provided with respect to any series of Securities in the supplemental
indenture or
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Certified Board Resolution pursuant to which such series is Issued, Holdings
shall not consolidate with or merge with or into, or convey, transfer or lease
all or substantially all its assets to, any Person, unless:
(i) the resulting, surviving or transferee Person (if not
Holdings) shall be a Person organized and existing under the laws of
the United States of America, any State thereof or the District of
Columbia and, in the case of any transaction covered by this Section
5.01(a) occurring after the Escrow Corp. Merger in which Holdings is
not the resulting, surviving or transferee Person, such Person shall
expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Issuer under this Indenture and all the Securities;
(ii) immediately after giving effect to such transaction (and
treating any Debt which becomes an obligation of the resulting,
surviving or transferee Person or any of its Subsidiaries as a result
of such transaction as having been Issued by such Person or such
Subsidiary at the time of such transaction), no Default shall have
occurred and be continuing;
(iii) immediately after giving effect to such transaction, the
resulting, surviving or transferee Person shall have a Consolidated Net
Worth in an amount which is not less than the Consolidated Net Worth of
Holdings immediately prior to such transaction; and
(iv) the Issuer shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if
any) complies with this Indenture.
(b) In the case of the Escrow Corp. Merger or any other
transaction covered by Section 5.01(a), the term "Holdings" when used in this
Indenture and the Securities shall mean the resulting, surviving or transferee
Person in such transaction and not any other entity which previously had been
covered by such term. In addition, in the case of the Escrow Corp. Merger or any
other transaction covered by Section 5.01(a) occurring after the Escrow Corp.
Merger, the resulting, surviving or transferee Person shall be the successor
company and shall succeed to, and be substituted for, and may exercise every
right and power of, the Issuer under this Indenture, and thereafter, except in
the case of a lease, the Issuer shall be discharged from all obligations and
covenants under this Indenture and the Securities.
(c) Escrow Corp. shall not consolidate with or merge with or
into, or convey, transfer or lease any of its assets to, any Person, other than
in connection with the Escrow Corp. Merger pursuant to the Escrow Corp. Merger
Agreement. After the consummation of the Escrow Corp. Merger and upon execution
and delivery by Holdings to the Trustee of an indenture supplemental hereto
pursuant to which
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Holdings shall expressly assume all the obligations of the Issuer under this
Indenture and the Securities, Holdings will succeed to, and be substituted for,
and will exercise every right and power of the Issuer hereunder.
ARTICLE VI
Defaults and Remedies
SECTION 6.01. Events of Default. An "Event of Default" with
respect to any series of Securities occurs (unless such event is either
inapplicable to a particular series or it is specifically deleted or modified in
or pursuant to the supplemental indenture or Certified Board Resolution creating
such series of Securities or in the form of Security for such series) if:
(1) the Issuer (i) defaults in the payment of the Principal of
any Security of that series when the same becomes due and payable at its Stated
Maturity, upon redemption, upon required purchase, upon declaration or
otherwise, (ii) defaults in any payment of interest on any Security of that
series when the same becomes due and payable and such default continues for a
period of 30 days or (iii) fails to purchase or redeem Securities of that series
when required pursuant to this Indenture or such Securities;
(2) the Issuer fails to comply with Section 5.01;
(3) the Issuer, Holdings or Holdings' Subsidiaries defaults in
the performance of, or breaches, any of Sections 4.02, 4.03, 4.04, 4.05, 4.06
(other than a failure to purchase the Securities), 4.07, 4.08, 4.09, 4.10 and
4.11, as applicable in this Indenture in respect of the Securities of such
series (all of such Sections which are not expressly stated to be for the
benefit of a particular series of Securities being deemed to be in respect of
the Securities of all series for this purpose), and in any such case such
default or breach continues for 30 days after the notice specified below;
(4) the Issuer or Holdings fails to comply with any of its
agreements in this Indenture in respect of the Securities of such series, other
than those referred to in (1), (2) or (3) above (all of such agreements in this
Indenture which are not expressly stated to be for the benefit of a particular
series of Securities being deemed in respect of the Securities of all series for
this purpose), and in any such case such failure continues for 60 days after the
notice specified below;
(5) Debt of the Issuer, Holdings or any Significant Subsidiary
of Holdings is not paid within any applicable grace period after final maturity
or is accelerated by the holders thereof because of a default and the total
principal amount of the portion of such Debt that is unpaid or accelerated
exceeds $25,000,000 or its
53
foreign currency equivalent and such default continues for five days after the
notice specified below;
(6) Any of the Issuer, Holdings or any Significant Subsidiary
of Holdings, pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief
against it in an involuntary case;
(C) consents to the appointment of a Custodian of it
or for any substantial part of its property;
(D) makes a general assignment for the benefit of its
creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(7) a court of competent jurisdiction shall enter an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Issuer, Holdings or any
Significant Subsidiary of Holdings in an involuntary case;
(B) appoints a Custodian of the Issuer, Holdings or
any Significant Subsidiary of Holdings or for any substantial
part of its property; or
(C) orders the winding up or liquidation of the
Issuer, Holdings or any Significant Subsidiary of Holdings;
or any similar relief is granted under any foreign laws and the order
or decree remains unstayed and in effect for 60 days; or
(8) any judgment or decree for the payment of money in excess
of $25,000,000 is entered against the Issuer, Holdings or any Significant
Subsidiary of Holdings and is not discharged and either (A) an enforcement
proceeding has been commenced by any creditor upon such judgment or decree or
(B) there is a period of 60 days following the entry of such judgment or decree
during which such judgment or decree is not discharged, waived or the execution
thereof stayed, and, in the case of (B), such default continues for 10 days
after the notice specified below; or
(9) any other Event of Default provided in the supplemental
indenture or Certified Board Resolution under which such series of Securities is
issued or in the form of Security for such series.
54
The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or involuntary
or is effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body.
The term "Bankruptcy Law" means Title 11, United States Code,
or any similar Federal or state law for the relief of debtors or, with respect
to any Depository Institution, Sections 11-13 of the Federal Deposit Insurance
Act, 12 U.S.C. ss.ss. 1821-23, or any similar Federal or state law relating to
conservatorships or receiverships of Depository Institutions. The term
"Custodian" means any receiver, conservator, trustee, assignee, liquidator,
custodian or similar official under any Bankruptcy Law.
A Default under clause (3), (4), (5) or (8)(B) is not an Event
of Default with respect to a series of Securities until the Trustee or the
Holders of at least 25% in Principal amount of the Outstanding Securities of
such series notify the Issuer of the Default and the Issuer does not cure such
Default within the time specified after receipt of such Notice. Such Notice must
specify the Default and the series with respect to which such Default relates,
demand that it be remedied and state that such notice is a "Notice of Default"
hereunder with respect to such series.
SECTION 6.02. Acceleration. If an Event of Default (other than
an Event of Default specified in Section 6.01(6) or (7) with respect to the
Issuer) occurs and is continuing with respect to any series of Securities, then
in each and every such case, unless the Principal of all of the Securities of
such series shall have already become due and payable, either the Trustee by
notice to the Issuer or the Holders of at least 25% in Principal amount of the
Securities of such series then Outstanding hereunder (each such series acting as
a separate class) by notice to the Issuer (and the Trustee if given by Holders)
may declare the Principal amount (or, if the Securities of such series are
Original Issue Discount Securities, such portion of the Principal amount as may
be specified in the terms of that series) of all the Securities of such series
and all accrued interest thereon as of the date of such declaration
(collectively, the "Default Amount") to be due and payable immediately, and upon
any such declaration the same shall become and shall be immediately due and
payable. If an Event of Default specified in Section 6.01(6) or (7) with respect
to the Issuer occurs, the Default Amount on all the Securities as of the date of
such Event of Default shall ipso facto become and be immediately due and payable
without any declaration or other act on the part of the Trustee or any Holders.
The Holders of a majority in Principal amount of the Securities of a series by
notice to the Trustee may rescind an acceleration with respect to such series
and its consequences if the rescission would not conflict with any judgment or
decree and if all existing Events of Default with respect to such series of
Securities have been cured or waived except nonpayment of Principal of the
Securities of such series or interest thereon that has become due solely because
of such acceleration. No such rescission shall affect any subsequent Default or
impair any right consequent thereto.
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SECTION 6.03. Other Remedies. If an Event of Default occurs
and is continuing with respect to any series of Securities, the Trustee may
pursue any available remedy to collect the payment of Principal of or interest
on the Securities of such series or to enforce the performance of any provision
of the Securities of such series or this Indenture.
The Trustee may maintain a proceeding with respect to a series
of Securities even if it does not possess any of the Securities of such series
or does not produce any of them in the proceeding. A delay or omission by the
Trustee or any Holder in exercising any right or remedy accruing upon an Event
of Default shall not impair the right or remedy or constitute a waiver of or
acquiescence in the Event of Default. No remedy is exclusive of any other
remedy. All available remedies are cumulative.
SECTION 6.04. Waiver of Past Defaults. The Holders of a
majority in Principal amount of the Securities of any series by notice to the
Trustee and the Issuer may waive an existing Default and its consequences in
respect of such series, except (i) a Default in the payment of the Principal of
the Securities of such series or interest thereon or (ii) a Default in respect
of a provision that under Section 9.02 cannot be amended without the consent of
each Holder of the Securities of such series affected. When a Default is waived,
it is deemed cured, but no such waiver shall extend to any subsequent or other
Default or impair any consequent right.
SECTION 6.05. Control by Majority of Securityholders. The
Holders of a majority in Principal amount of the Securities of any series may
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee with respect to the Securities of such series or of
exercising any trust or power conferred on the Trustee with respect to the
Securities of such series. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture or, subject to Section 7.01,
that the Trustee determines is unduly prejudicial to the rights of other Holders
of Securities of such series or would involve the Trustee in personal liability;
provided, however, that the Trustee may take any other action deemed proper by
the Trustee that is not inconsistent with such direction. Prior to taking any
action hereunder, the Trustee shall be entitled to indemnification satisfactory
to it in its sole discretion against any loss, liability or expense caused by
taking or not taking such action.
SECTION 6.06. Limitation on Suits. No Holder of any Security
of any series shall have the right to pursue any remedy with respect to this
Indenture or the Securities of such series unless:
(a) such Holder has previously given to the Trustee written
notice stating that an Event of Default with respect to Securities of such
series is continuing;
56
(b) the Holders of at least 25% in Principal amount of the
Outstanding Securities of such series shall have made a written request to the
Trustee to pursue the remedy;
(c) such Holder or Holders have offered to the Trustee
reasonable security or indemnity against any loss, liability or expense to be
incurred in compliance with such request;
(d) the Trustee has not complied with such request within 60
days after receipt of the request and the offer of security or indemnity; and
(e) the Holders of a majority in Principal amount of the
Outstanding Securities of such series have not given the Trustee a direction
inconsistent with such request during such 60-day period.
A Holder of Securities of any series may not use this
Indenture to prejudice the rights of another Holder of Securities of such series
or to obtain a preference or priority over another Holder, except in the manner
herein provided and for the equal and proportionate benefit of Holders of all
Securities of such series.
SECTION 6.07. Rights of Holder To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any Holder
to receive payment of Principal of and interest on the Securities held by such
Holder, on or after the respective due dates expressed in the Securities, or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of
Default in payment of interest or Principal specified in Section 6.01(1) occurs
and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Issuer for the whole amount of Principal
and interest remaining unpaid (together with interest on such unpaid interest to
the extent lawful) and the amounts provided for in Section 7.07.
SECTION 6.09. Trustee May File Proofs of Claim. The Trustee
may, but shall have no obligation 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 and the Holders allowed in any judicial proceedings relative to the
Issuer, its creditors or its property and, unless prohibited by law or
applicable regulations, may, but shall have no obligation to, vote on behalf of
the Holders in any election of a trustee in bankruptcy or other Person
performing similar functions, and any Custodian in any such judicial proceeding
is hereby authorized by each Holder to make payments to the Trustee and, in the
event that the Trustee shall consent to the making of such payments directly to
the Holders, to pay to the Trustee any amount due it for
57
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and its counsel, and any other amounts due the Trustee under
Section 7.07.
SECTION 6.10. Priorities. If the Trustee collects any money or
property with respect to a series of Securities pursuant to this Article VI, it
shall pay out the money or property in the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to Holders for amounts due and unpaid on the
Securities of such series for Principal and interest, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Securities of such series for Principal and interest, if
any, respectively; and
THIRD: to the Issuer.
The Trustee may fix a record date and payment date for any
payment to Holders of Securities of any series pursuant to this Section. At
least 15 days before such record date, the Issuer shall mail to each Holder of
Securities of such series and the Trustee a notice that states the record date,
the payment date (which shall be not less than one Business Day following the
record date) and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, against any
party litigant in the suit, having due regard to the merits and good faith of
the claims or defenses made by the party litigant. This Section does not apply
to a suit by the Trustee, a suit by a Holder for the enforcement of the payment
of the Principal of, or interest on, any Security on or after the respective due
dates expressed in such Security or a suit by Holders of more than 10% in
Principal amount of the Outstanding Securities of any series to which the suit
relates.
SECTION 6.12. Waiver of Stay or Extension Laws. The Issuer (to
the extent it may lawfully do so) shall not at any time insist upon, or plead,
or in any manner whatsoever claim or take the benefit or advantage of, any stay
or extension law wherever enacted, now or at any time hereafter in force, which
may affect the covenants or the performance of this Indenture; and the Issuer
(to the extent that it may lawfully do so) hereby expressly waives all benefit
or advantage of any such law, and shall not hinder, delay or impede the
execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law had been enacted.
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ARTICLE VII
The Trustee
SECTION 7.01. Duties of Trustee. (a) If an Event of Default
with respect to any series of Securities has occurred and is continuing, the
Trustee shall exercise with respect to the Securities of such series such of the
rights and powers vested in it by this Indenture, and use the same degree of
care and skill in its exercise, as a prudent man would exercise or use under the
circumstances in the conduct of such man's own affairs.
(b) Except during the continuance of an Event of Default with
respect to any series of Securities:
(i) the Trustee undertakes to perform such duties and
only such duties as are specifically set forth in this Indenture with
respect to the Securities of such series and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the
Trustee may, with respect to Securities of such series, conclusively
rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture.
However, in the case of any such opinions or certificates which by any
provision hereof are specifically required to be furnished to the
Trustee, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) 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:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to
any action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05.
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(d) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuer.
(e) Money held in trust by the Trustee need not be segregated
from other funds except to the extent required by law.
(f) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(g) Every provision of this Indenture relating in any way to
the Trustee or its conduct or affecting the liability of or affording protection
to the Trustee shall be subject to the provisions of each paragraph of this
Section and Section 7.02 (unless expressly not applicable) and to the provisions
of the TIA.
SECTION 7.02. Rights of Trustee. (a) The Trustee may
conclusively rely on and shall be protected in acting or refraining from acting
in accordance with any document believed by it to be genuine and to have been
signed or presented by the proper Person. The Trustee need not investigate any
fact or matter stated in the document;
(b) before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
the Officers' Certificate or Opinion of Counsel;
(c) the Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care;
(d) the Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers, provided that the Trustee's conduct does not constitute
willful misconduct, negligence or bad faith;
(e) the Trustee may consult with counsel of its selection, and
the advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Securities shall be full and complete authorization and
protection from liability in respect of any action taken, omitted or suffered by
it hereunder in good faith and in accordance with the advice or opinion of such
counsel;
(f) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders pursuant to this Indenture, unless such Holders
shall have offered to the
60
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in acting in accordance with such
request or direction; and
(g) any request or direction of the Issuer mentioned herein
shall be sufficiently evidenced by an Issuer Request or Issuer Order and any
resolution of the Board of Directors of the Issuer may be sufficiently evidenced
by a Certified Board Resolution.
SECTION 7.03. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Issuer or its Affiliates with the same rights it
would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar or
co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Issuer's
use of the Securities or of the proceeds from the Securities, and it shall not
be responsible for any statement in this Indenture or in any document issued in
connection with the sale of the Securities or in the Securities other than the
Trustee's certificate of authentication.
SECTION 7.05. Notice of Defaults. If a Default with respect to
Securities of any series occurs and is continuing and if it is known to the
Trustee, the Trustee shall mail to all Securityholders of such series, as their
names and addresses appear in the Security Register, notice of the Default
within 90 days after it occurs. Except in the case of a Default in payment of
Principal of or interest, if any, on any Security of any series, the Trustee may
withhold the notice if and so long as a committee of its Trust Officers in good
faith determines that withholding the notice is in the interests of the
Securityholders of such series.
SECTION 7.06. Reports by Trustee to Holders. The Trustee shall
transmit to Holders by May 15 of each year, commencing May 15, 1999, such
reports concerning the Trustee and its actions under this Indenture as may be
required pursuant to the TIA at the times and in the manner provided pursuant
thereto. The Trustee also shall comply with TIA ss.313(b).
A copy of each report at the time of its mailing to Holders
shall be filed with the SEC and each stock exchange (if any) on which the
Securities are listed. The Issuer agrees to notify promptly the Trustee whenever
the Securities become listed on any stock exchange and of any delisting thereof.
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SECTION 7.07. Compensation and Indemnity. The Issuer shall pay
to the Trustee from time to time such compensation as shall be agreed to in
writing from time to time by the Issuer and the Trustee for its services. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuer shall reimburse the Trustee upon request
for all reasonable out-of-pocket expenses incurred or made by it, including
costs of collection, in addition to the compensation for its services. Such
expenses shall include the reasonable compensation and expenses, disbursements
and advances of the Trustee's agents, counsel, accountants and experts. The
Issuer shall indemnify each of the Trustee or any predecessor Trustee and each
of the Trustee's agents, officers, directors, employees and stockholders (each
an "indemnitee") against any and all loss, liability, damage, claim or expense
(including attorneys' fees and expenses) incurred by each indemnitee in
connection with the acceptance or administration of this trust and the
performance of its duties hereunder. As security for the performance of the
obligations of the Issuer under this Section the Trustee shall have a lien prior
to the Securities upon all property and funds collected by the Trustee as such,
except funds held in trust for the payment of Principal or interest on any
particular Securities. Each indemnitee shall notify the Issuer promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Issuer shall not relieve the Issuer of its obligations hereunder. The Issuer
shall defend the claim and any or all indemnitees may have separate counsel and
the Issuer shall pay the fees and expenses of any such counsel. The Issuer need
not reimburse any expense or indemnify against any loss, liability or expense
incurred by any indemnitee through its own willful misconduct, negligence or bad
faith.
The Issuer's payment obligations pursuant to this Section
shall survive the discharge of this Indenture. When the Trustee incurs expenses
after the occurrence of a Default specified in Section 6.01(6) or (7) with
respect to the Issuer, the expenses are intended to constitute expenses of
administration under the Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The Trustee may resign
with respect to any series of Securities at any time by so notifying the Issuer.
The Holders of a majority in Principal amount of the Securities of any series
may remove the Trustee with respect to that series of Securities by so notifying
the Trustee and may appoint a successor Trustee. The Issuer shall remove the
Trustee with respect to any series or, in the case of clauses (2) and (3) below,
with respect to all series if at any time:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the
Trustee or its property; or
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(4) the Trustee otherwise becomes incapable of acting with
respect to any series of Securities.
If the Trustee resigns, is removed by the Issuer, is removed
by Holders of a majority in Principal amount of the Securities of any series and
they do not promptly appoint a successor Trustee, or if a vacancy exists in the
office of Trustee with respect to any series of Securities for any reason (the
Trustee in such event being referred to herein as the retiring Trustee), the
Issuer shall promptly appoint a successor Trustee for that series of Securities.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Thereupon the resignation
or removal of the retiring Trustee shall become effective with respect to any
series as to which it is resigning or being removed as Trustee, and the
successor Trustee shall become vested with all the rights, powers and duties of
the Trustee with respect to any such series under this Indenture. The successor
Trustee shall mail a notice of its succession to Holders of Securities of that
series as their names and addresses appear in the Security Register. The
retiring Trustee shall promptly transfer all property held by it as Trustee
hereunder with respect to all or any such series to the successor Trustee,
subject to the lien provided for in Section 7.07.
In case of the appointment hereunder of a successor Trustee
with respect to the Securities of one or more (but not all) series, the Issuer,
the predecessor 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 predecessor Trustee with respect to the Securities of any series as to
which the predecessor Trustee is not being succeeded 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 trusts 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 with respect to any series of Securities
shall accept its appointment unless at the time of such acceptance such
successor Trustee shall be qualified and eligible with respect to that series
under this Article.
If a successor Trustee with respect to any series of
Securities does not accept appointment within 60 days after the retiring Trustee
tenders its resignation or is removed, the retiring Trustee, the Issuer or the
Holders of a majority in Principal amount of the Securities of such series may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
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If the Trustee with respect to any series of Securities fails
to comply with Section 7.10, any Holder of a Security of that series may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee with respect to such series.
Notwithstanding the replacement of the Trustee pursuant to
this Section, the Issuer's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture any of the Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor Trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have.
SECTION 7.10. Eligibility; Disqualification. The Trustee for
the Securities of any series issued hereunder shall at all times satisfy the
requirements of TIA ss.310(a). The Trustee shall have a combined capital and
surplus of at least $50,000,000 as set forth in its most recent published annual
report of condition. The Trustee shall comply with TIA ss.310(b); provided,
however, that there shall be excluded from the operation of TIA ss.310(b)(1)
any indenture or indentures under which other securities or certificates of
interest or participation in other securities of the Issuer are outstanding if
the requirements for such exclusion set forth in TIA ss.310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against the
Issuer. The Trustee shall comply with TIA ss.311(a), excluding any creditor
relationship listed in TIA ss.311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss.311(a) to the extent indicated therein.
SECTION 7.12. Money Held in Trust. Money held by the Trustee
in trust hereunder need not be segregated from other funds except to the extent
required by law. The Trustee shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed in writing with the
Issuer.
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ARTICLE VIII
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securities;
Defeasance. (a) With respect to any series of Securities, when (i) the Issuer
delivers to the Trustee all Outstanding Securities of such series (other than
Securities of such series replaced pursuant to Section 2.10) for cancellation or
(ii) all Outstanding Securities of such series have become due and payable and
the Issuer irrevocably deposits with the Trustee funds sufficient to pay at
maturity all Outstanding Securities of such series, including interest thereon
(other than Securities of such series replaced pursuant to Section 2.10), and if
in either case the Issuer pays all other sums payable hereunder by the Issuer
with respect to the Securities of such series, then this Indenture shall,
subject to Sections 8.01(c) and 8.06, cease to be of further effect with respect
to such series. The Trustee shall acknowledge satisfaction and discharge of this
Indenture as to such series on demand of the Issuer accompanied by an Officers'
Certificate and an Opinion of Counsel as to the satisfaction of all conditions
to such satisfaction and discharge of this Indenture as to such series and at
the cost and expense of the Issuer.
(b) Subject to Sections 8.01(c), 8.02 and 8.06, the Issuer at
any time may terminate with respect to any series (i) all its obligations under
the Securities of such series and this Indenture in respect of such series
("legal defeasance option") or (ii) its obligations under Sections 4.02 to 4.11,
inclusive, and 5.01(a)(iii) and the operation of Sections 6.01(5), 6.01(6) (with
respect to Significant Subsidiaries of Holdings only), 6.01(7) (with respect to
Significant Subsidiaries of Holdings only) and 6.01(8) and mandatory redemption
provisions, if any, of the Securities of such series ("covenant defeasance
option"). The Issuer may exercise its legal defeasance option notwithstanding
its prior exercise of its covenant defeasance option.
If the Issuer exercises its legal defeasance option with
respect to any series, payment of the Securities of such series may not be
accelerated because of an Event of Default. If the Issuer exercises its covenant
defeasance option with respect to any series, payment of the Securities of such
series may not be accelerated because of an Event of Default specified in
6.01(3), 6.01(5), 6.01(6) (with respect to Significant Subsidiaries only),
6.01(7) (with respect to Significant Subsidiaries only) and 6.01(8) or because
of the failure of Holdings to comply with clause (a)(iii) of Section 5.01.
Upon satisfaction of the conditions set forth herein and upon
request of the Issuer, the Trustee shall acknowledge in writing the discharge of
those obligations that the Issuer terminates.
(c) Notwithstanding the satisfaction and discharge of this
Indenture with respect to any series of Securities, the Issuer's obligations in
Sections 2.06,
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2.07, 2.08, 2.09, 2.10, 7.07, 7.08, 8.04, 8.05 and 8.06 shall survive until the
Securities have been paid in full. Thereafter, the Issuer's obligations in
Sections 7.07, 8.04 and 8.05 shall survive.
SECTION 8.02. Conditions to Defeasance. Unless otherwise
provided in the supplemental indenture or Certified Board Resolution pursuant to
which a series of Securities is Issued, the Issuer may exercise its legal
defeasance option or its covenant defeasance option with respect to any series
only if:
(1) the Issuer irrevocably deposits in trust with the
Trustee money or U.S. Government Obligations for the payment of
Principal and interest on the Securities of such series to
maturity or redemption, as the case may be;
(2) the Issuer delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing
their opinion that the payments of principal and interest when
due and without reinvestment on the deposited U.S. Government
Obligations plus any deposited money without investment will
provide cash at such times and in such amounts as will be
sufficient to pay Principal and interest when due on all the
Outstanding Securities of such series to maturity or redemption,
as the case may be;
(3) 123 days pass after the deposit is made and during the
123-day period no Default described in Section 6.01(6) or (7)
with respect to the Issuer occurs which is continuing at the end
of the period;
(4) the deposit does not constitute a default under any
other agreement binding on the Issuer;
(5) the Issuer delivers to the Trustee an Opinion of Counsel
to the effect that the trust resulting from the deposit does not
constitute, or is qualified as, a regulated investment company
under the Investment Company Act of 1940;
(6) in the case of the legal defeasance option, the Issuer
shall have delivered to the Trustee an Opinion of Counsel stating
that (i) the Issuer has received from, or there has been
published by, the Internal Revenue Service a ruling, or (ii)
since the date of this Indenture there has been a change in the
applicable Federal income tax law, in either case to the effect
that, and based thereon such Opinion of Counsel shall confirm
that, the Holders of the Securities of such series will not
recognize income, gain or loss for Federal income tax purposes as
a result of such defeasance and will be subject to Federal income
tax on the same amounts, in the same manner and at the same times
as would have been the case if such defeasance had not occurred;
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(7) in the case of the covenant defeasance option, the
Issuer shall have delivered to the Trustee an Opinion of Counsel
to the effect that the Holders of the Securities of such series
will not recognize income, gain or loss for Federal income tax
purposes as a result of such covenant defeasance and will be
subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such
defeasance had not occurred; and
(8) the Issuer delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent to the defeasance and discharge of the
Securities of such series as contemplated by this Article VIII
have been complied with.
Notwithstanding the foregoing provisions of this Section, the
conditions set forth in the foregoing paragraphs (2), (3), (4), (5), (6) and (7)
need not be satisfied with respect to any series so long as, at the time the
Issuer makes the deposit described in paragraph (1), (i) no Default or Event of
Default referred to in Section 6.01(1), 6.01(6) or 6.01(7) has occurred and is
continuing with respect to such series on the date of such deposit and after
giving effect thereto and (ii) either (x) a notice of redemption has been mailed
pursuant to Section 3.04 providing for redemption of all the Securities of such
series not later than 60 days after such mailing and the provisions of Section
3.02 with respect to such redemption shall have been complied with or (y) the
Stated Maturity of the Securities of such series will occur within 60 days. If
the conditions in the preceding sentence are satisfied, the Issuer shall be
deemed to have exercised its covenant defeasance option with respect to such
series.
Before or after a deposit described in this Section 8.02 with
respect to any series, the Issuer may make arrangements satisfactory to the
Trustee for the redemption of Securities of such series at a future date in
accordance with Article III.
SECTION 8.03. Application of Trust Money. The Trustee shall
hold in trust money or U.S. Government Obligations deposited with it pursuant to
this Article VIII. It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in accordance with this
Indenture to the payment of Principal of and interest on the Securities of the
applicable series.
SECTION 8.04. Repayment to the Issuer. The Trustee and the
Paying Agent shall promptly turn over to the Issuer upon request any excess
money or securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee
and the Paying Agent shall pay to the Issuer upon request any money held by them
for the payment of Principal or interest of any series of Securities that
remains unclaimed for
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two years, and, thereafter, Holders of the Securities of such series entitled to
the money must look to the Issuer for payment as general creditors.
SECTION 8.05. Indemnity for Government Obligations. The Issuer
shall pay and shall indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against deposited U.S. Government Obligations or the
principal and interest received on such U.S. Government Obligations.
SECTION 8.06. Reinstatement. If the Trustee or Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with this
Article VIII in respect of any series of Securities by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Issuer's Obligations under this Indenture and the Securities in respect of such
series shall be revived and reinstated as though no deposit had occurred
pursuant to this Article VIII until such time as the Trustee or Paying Agent is
permitted to apply all such money or U.S. Government Obligations in accordance
with this Article VIII; provided, however, that, if the Issuer has made any
payment of interest on or Principal of any Securities because of the
reinstatement of its Obligations, the Issuer shall be subrogated to the rights
of the Holders of such Securities to receive such payment from the money or U.S.
Government Obligations held by the Trustee or Paying Agent.
ARTICLE IX
Amendments and Supplemental Indentures
SECTION 9.01. Without Consent of Holders. The Issuer and the
Trustee, at any time and from time to time, may enter into one or more
amendments or indentures supplemental hereto without notice to or consent of any
Holder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article V or Section 4.10;
(3) to provide for uncertificated Securities in addition to or
in place of certificated Securities; provided, however, that the
uncertificated Securities are Issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
(4) to add Guarantees with respect to the Securities of any
series, or to remove any such Guarantee, when permitted by the terms
hereof or to secure (or provide additional security for) the Securities
of any series;
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(5) to establish any form of Security and to provide for the
issuance of any series of Securities as provided in Article II and to
set forth the terms thereof, and/or to add to the rights of the Holders
of the Securities of any series;
(6) to add to the covenants of the Issuer or Holdings for the
benefit of the Holders of the Securities of any series or to surrender
any right or power herein conferred upon the Issuer for the benefit of
the Holders of the Securities of any series (and if such covenants or
the surrender of such right or power are to be for the benefit of less
than all series of Securities, stating that such covenants are
expressly being included or such surrenders are expressly being made
solely for the benefit of one or more specified series);
(7) to comply with any requirements of the SEC in connection
with qualifying this Indenture under the TIA or otherwise comply with
the TIA;
(8) to evidence and provide for the acceptance of appointment
by another corporation as a successor Trustee hereunder with respect to
one or more series of Securities 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 Section 7.08;
(9) to add any additional Events of Default in respect of the
Securities of any series (and if such additional Events of Default are
to be in respect of less than all series of Securities, stating that
such Events of Default are expressly being included solely for the
benefit of one or more specified series);
(10) to provide for the issuance of Securities in coupon as
well as fully registered form; or
(11) to make any change with respect to the Securities of any
one or more series that does not adversely affect the rights of any
Holder of the Outstanding Securities of any such series.
SECTION 9.02. With Consent of Holders. The Issuer and the
Trustee may enter into one or more amendments or indentures supplemental hereto
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders of Securities of any series under this
Indenture without notice to any Holder but with the written consent of the
Holders of at least a majority in Principal amount of the Outstanding Securities
of each series affected by such amendment or supplemental indenture. However,
without the consent of the Holder of each Outstanding Security affected, an
amendment or a supplemental indenture may not:
69
(1) reduce the Principal amount of Outstanding Securities of
any series whose Holders must consent to any amendment or supplemental
indenture, or whose Holders must consent to any waiver of compliance
with certain provisions of this Indenture or certain defaults hereunder
and their consequences, provided for in this Indenture;
(2) reduce the rate of or extend the time for payment of
interest on any Security;
(3) reduce the Principal of or extend the Stated Maturity of
any Security or reduce the Default Amount of any Security;
(4) reduce the premium payable upon the redemption of any
Security or change the time at which any Security may be redeemed at
the option of the Issuer;
(5) make any Security or premium or interest thereon payable
in money other than that stated in the Security;
(6) make any change in Section 4.06 relating to the date by
which the Issuer must purchase, or in the obligation of the Issuer to
purchase, tendered Securities, the definition of Change of Control,
Section 6.04 or 6.07 or the second sentence of this Section; or
(7) make any change in mandatory redemption provisions, if
any, of the Securities of any series.
An amendment or 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 the Holders of Securities of such
series with respect to such covenant or other provision, shall be deemed not to
affect the rights under this Indenture of Holders of Securities of any other
series.
It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any amendment or supplemental
indenture, but it shall be sufficient if such consent approves the substance
thereof.
SECTION 9.03. Compliance with Trust Indenture Act. Every
amendment or supplemental indenture executed pursuant to this Article shall
comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents and Waivers.
Any amendment or supplemental indenture shall become effective in accordance
with its terms when executed and delivered by the Issuer and the Trustee,
provided that the
70
Issuer has received the requisite consents prior thereto. The Issuer shall not
be obligated to execute any such amendment or supplemental indenture regardless
of whether such consents have been received. Any waiver shall become effective
when the requisite consents have been received or such later time as the Issuer
may elect by notice to the Trustee. A consent to an amendment, supplemental
indenture or waiver by a Holder of a Security shall bind the Holder and every
subsequent Holder of that Security or portion of the Security that evidences the
same Debt as the consenting Holder's Security, even if notation of the consent
or waiver is not made on the Security. However, any such Holder or subsequent
Holder may revoke the consent or waiver as to such Holder's Security or portion
of the Security if the Trustee receives the notice of revocation prior to the
time that the Issuer receives the requisite number of consents to such proposed
amendment, supplemental indenture or waiver. After an amendment, supplemental
indenture or waiver becomes effective, it shall bind every Holder. A consent to
any amendment, supplemental indenture or waiver hereunder by any Holder given in
connection with a tender of such Holder's Securities shall not be rendered
invalid by such tender.
The Issuer may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to give their consent
or take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Holders at such record
date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall be valid or effective for more than 120
days after such record date.
SECTION 9.05. Notation on or Exchange of Securities. If an
amendment or supplemental indenture changes the terms of a Security, the Trustee
may require the Holder of the Security to deliver it to the Trustee. The Trustee
may place an appropriate notation in form approved by the Trustee on the
Security regarding the changed terms and return it to the Holder. Alternatively,
if the Issuer or the Trustee so determines, the Issuer in exchange for the
Security shall Issue and the Trustee shall authenticate a new Security that
reflects the changed terms. Failure to make the appropriate notation or to Issue
a new Security shall not affect the validity of such amendment or supplemental
indenture.
SECTION 9.06. Trustee To Sign Amendments and Supplemental
Indentures. The Trustee shall sign any amendment or supplemental indenture
authorized pursuant to this Article IX if the amendment or supplemental
indenture does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. If it does, the Trustee may but need not sign it. In
signing such amendment or supplemental indenture the Trustee shall be entitled
to receive indemnity reasonably satisfactory to it and to receive, and (subject
to Section 7.01) shall be fully protected
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in relying upon, an Officers' Certificate and an Opinion of Counsel stating that
such amendment or supplemental indenture is authorized or permitted by this
Indenture.
SECTION 9.07. Effect of Amendment or Supplemental Indenture.
Upon the execution of any amendment or supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
amendment or supplemental indenture shall form a part of this Indenture for all
purposes; and every Holder of Securities theretofore or thereafter authenticated
and delivered hereunder shall be bound thereby to the extent provided therein.
SECTION 9.08. Payment for Consent. Neither the Issuer, any
Affiliate of the Issuer nor any Subsidiary shall, directly or indirectly, pay or
cause to be paid any consideration, whether by way of interest, fee or
otherwise, to any Holder for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Securities
of any series unless such consideration is offered to be paid or agreed to be
paid to all Holders or Holders of Securities of such series, as the case may be,
which so consent, waive or agree to amend in the time frame set forth in
solicitation documents relating to such consent, waiver or amendment.
ARTICLE X
Miscellaneous
SECTION 10.01. Trust Indenture Act Controls. If any provision
of this Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.
SECTION 10.02. Notices. Any notice or communication shall be
in writing and delivered in Person or mailed by first-class mail addressed as
follows:
if to Escrow Corp. or Holdings:
35 East 62nd Street
New York, NY 10021
Attention of General Counsel
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if to the Trustee:
The Bank of New York
101 Barclay Street, Floor 21 West
New York, NY 10286
Attention of Corporate Trust Trustee Administration
The Issuer or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Holder shall be sent
by first-class mail to the Holder at the Holder's address as it appears on the
registration books of the Registrar and shall be sufficiently given if so mailed
within the time prescribed.
Failure to mail a notice or communication to a Holder or any
defect in it shall not affect its sufficiency with respect to other Holders. If
a notice or communication is mailed to a Holder in the manner provided above, it
is duly given, whether or not the addressee receives it.
SECTION 10.03. Communication by Holders with other Holders.
Holders may communicate in accordance with TIA ss.312(b) with other Holders
with respect to their rights under this Indenture or the Securities. The Issuer,
the Trustee, the Registrar and anyone else shall have the protection of TIA
ss.312(c).
SECTION 10.04. Certificate and Opinion as to Conditions
Precedent. Upon any request or application by the Issuer to the Trustee to take
or refrain from taking any action under this Indenture, the Issuer shall furnish
to the Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee 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
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such
counsel, all such conditions precedent have been complied with;
provided, however, that, in the case of such application or request as to which
the furnishing of such documents, certificates or opinions is specifically
required by any provision of this Indenture relating to such particular
application or request, no additional certificate or opinion need be furnished.
SECTION 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a covenant or
condition
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provided for in this Indenture (other than the Officer's Certificate required by
Section 4.12) 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 covenant or condition has been complied with.
SECTION 10.06. When Securities Disregarded. In determining
whether the Holders of the required Principal amount of Outstanding Securities
have concurred in any request, demand, authorization, direction, waiver or
consent, Securities owned by the Issuer or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Issuer shall be disregarded and deemed not to be Outstanding, except that, for
the purpose of determining whether the Trustee shall be protected in relying on
any such request, demand, authorization, direction, waiver or consent, only
Securities which the Trustee knows are so owned shall be so disregarded. Also,
subject to the foregoing, only Securities Outstanding at the time shall be
considered in any such determination.
SECTION 10.07. Rules by Trustee, Paying Agent and Registrar.
Subject to Section 10.06, the Trustee may make reasonable rules for action by or
a meeting of Holders. The Registrar and the Paying Agent may make reasonable
rules for their functions.
SECTION 10.08. Legal Holidays. Unless otherwise provided in
the supplemental indenture or Certified Board Resolution pursuant to which a
series of Securities is Issued, if a payment date with respect to any series of
Securities is a Legal Holiday, payment shall be made on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue for the intervening
period. If a regular record date with respect to any series of Securities is a
Legal Holiday, the record date shall not be affected.
SECTION 10.09. Governing Law. This Indenture and the
Securities shall be governed by, and construed in accordance with, the laws of
the State of New
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York but without giving effect to applicable principles of conflicts of law to
the extent that the application of the laws of another jurisdiction would be
required thereby.
SECTION 10.10. No Recourse Against Others. A director,
officer, employee or stockholder, as such, of the Issuer or the Trustee shall
not have any liability for any obligations of the Issuer or the Trustee under
the Securities or this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Holder shall waive and release all such liability. The waiver and release shall
be part of the consideration for the Issue of the Securities.
SECTION 10.11. Successors. All agreements of the Issuer in
this Indenture and the Securities shall bind its successors. All agreements of
the Trustee in this Indenture shall bind its successors.
SECTION 10.12. Multiple Originals. The parties may sign any
number of copies of this Indenture. Each signed copy shall be an original, but
all of them together represent the same agreement. One signed copy is enough to
prove this Indenture.
SECTION 10.13. Table of Contents; Headings. The table of
contents, cross-reference sheet and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not
intended to be considered a part hereof and shall not modify or restrict any of
the terms or provisions hereof.
SECTION 10.14. Separability Clause. In case any provision in
this Indenture or in the Securities shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
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IN WITNESS WHEREOF, the parties have caused this Indenture to
be duly executed as of the date first written above.
GS ESCROW CORP.
By: /s/ Glenn Dickes
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Name: Glenn P. Dickes
Title: Vice President and Secretary
THE BANK OF NEW YORK,
as Trustee,
By: /s/ Robert A. Massimillo
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Name: Robert Massimillo
Title: Assistant Vice President