EXHIBIT 4.1
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IMPERIAL CREDIT INDUSTRIES, INC.
12% SENIOR SECURED NOTES DUE 2005
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INDENTURE
Dated as of July 3, 2001
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The Chase Manhattan Bank and Trust Company, National Association
Trustee
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CROSS-REFERENCE TABLE
Trust Indenture
Act Section Indenture Section
310(a)(1)........................................... 7.10
(a)(2)........................................... 7.10
(a)(3)........................................... N.A.
(a)(4)........................................... N.A.
(a)(5)........................................... 7.10
(b).............................................. 7.10
(c).............................................. N.A.
311(a).............................................. 7.11
(b).............................................. 7.11
(c).............................................. N.A.
312(a).............................................. 2.05
(b).............................................. 12.03
(c).............................................. 12.03
313(a).............................................. 7.06
(b)(1)........................................... N.A.
(b)(2)........................................... 7.07
(c).............................................. 7.06; 12.02
(d).............................................. 7.06
314(a).............................................. 4.03; 12.02
(b).............................................. 11.02
(c)(1)........................................... 12.04
(c)(2)........................................... 12.04
(c)(3)........................................... N.A.
(e).............................................. 12.05
(f).............................................. N.A.
315(a).............................................. 7.01
(b).............................................. 7.05;12.02
(c).............................................. 7.01
(d).............................................. 7.01
(e).............................................. 6.11
316(a)(last sentence)............................... 2.09
(a)(1)(A)........................................ 6.05
(a)(1)(B)........................................ 6.04
(a)(2)........................................... N.A.
(b).............................................. 6.07
(c).............................................. N.A.
317(a)(1)........................................... 6.08
(a)(2)........................................... 6.09
(b).............................................. 2.04
318(a).............................................. 12.01
(b).............................................. N.A.
(c).............................................. 12.01
N.A. means not applicable.
* This Cross-Reference Table is not part of the Indenture.
Table of Contents
Page
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE....................................................................... 1
SECTION 1.01 DEFINITIONS.................................................................................... 1
SECTION 1.02 OTHER DEFINITIONS.............................................................................. 12
SECTION 1.03 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.............................................. 13
SECTION 1.04 RULES OF CONSTRUCTION.......................................................................... 14
ARTICLE 2 THE NOTES........................................................................................................ 14
SECTION 2.01 FORM AND DATING................................................................................ 14
SECTION 2.02 EXECUTION AND AUTHENTICATION................................................................... 15
SECTION 2.03 REGISTRAR AND PAYING AGENT..................................................................... 16
SECTION 2.04 PAYING AGENT TO HOLD MONEY IN TRUST............................................................ 16
SECTION 2.05 HOLDER LISTS................................................................................... 17
SECTION 2.06 TRANSFER AND EXCHANGE.......................................................................... 17
SECTION 2.07 REPLACEMENT NOTES.............................................................................. 23
SECTION 2.08 OUTSTANDING NOTES.............................................................................. 24
SECTION 2.09 TREASURY NOTES................................................................................. 24
SECTION 2.10 TEMPORARY NOTES................................................................................ 24
SECTION 2.11 CANCELLATION................................................................................... 25
SECTION 2.12 DEFAULTED INTEREST............................................................................. 25
SECTION 2.13 CUSIP NUMBERS, ETC............................................................................. 25
ARTICLE 3 REDEMPTION AND PREPAYMENT........................................................................................ 25
SECTION 3.01 NOTICES TO TRUSTEE............................................................................. 25
SECTION 3.02 SELECTION OF NOTES TO BE REDEEMED.............................................................. 26
SECTION 3.03 NOTICE OF REDEMPTION........................................................................... 26
SECTION 3.04 EFFECT OF NOTICE OF REDEMPTION................................................................. 27
SECTION 3.05 DEPOSIT OF REDEMPTION PRICE.................................................................... 27
SECTION 3.06 NOTES REDEEMED IN PART......................................................................... 27
SECTION 3.07 OPTIONAL REDEMPTION............................................................................ 28
SECTION 3.08 MANDATORY REDEMPTION........................................................................... 28
ARTICLE 4 COVENANTS........................................................................................................ 28
SECTION 4.01 PAYMENT OF NOTES............................................................................... 28
SECTION 4.02 MAINTENANCE OF OFFICE OR AGENCY................................................................ 29
SECTION 4.03 REPORTS........................................................................................ 29
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TABLE OF CONTENTS
(continued)
Page
SECTION 4.04.......... COMPLIANCE CERTIFICATE..................................................... 29
SECTION 4.05.......... TAXES...................................................................... 30
SECTION 4.06.......... STAY, EXTENSION AND USURY LAWS............................................. 30
SECTION 4.07.......... CHANGE OF CONTROL.......................................................... 30
SECTION 4.08.......... ASSET SALES................................................................ 31
SECTION 4.09.......... RESTRICTED PAYMENTS........................................................ 32
SECTION 4.10.......... INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK................. 34
SECTION 4.11.......... LIENS...................................................................... 35
SECTION 4.12.......... DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES............. 36
SECTION 4.13.......... BUSINESS ACTIVITIES........................................................ 36
SECTION 4.14.......... TRANSACTIONS WITH AFFILIATES............................................... 36
ARTICLE 5 SUCCESSORS................................................................................... 37
SECTION 5.01.......... MERGER, CONSOLIDATION OR SALE OF ASSETS.................................... 37
SECTION 5.02.......... SUCCESSOR CORPORATION SUBSTITUTED.......................................... 38
ARTICLE 6 DEFAULTS AND REMEDIES........................................................................ 38
SECTION 6.01.......... EVENTS OF DEFAULT.......................................................... 38
SECTION 6.02.......... ACCELERATION............................................................... 39
SECTION 6.03.......... OTHER REMEDIES............................................................. 40
SECTION 6.04.......... WAIVER OF PAST DEFAULTS.................................................... 40
SECTION 6.05.......... CONTROL BY MAJORITY........................................................ 41
SECTION 6.06.......... LIMITATION ON SUITS........................................................ 41
SECTION 6.07.......... RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.............................. 41
SECTION 6.08.......... COLLECTION SUIT BY TRUSTEE................................................. 42
SECTION 6.09.......... TRUSTEE MAY FILE PROOFS OF CLAIM........................................... 42
SECTION 6.10.......... PRIORITIES................................................................. 42
SECTION 6.11.......... UNDERTAKING FOR COSTS...................................................... 43
ARTICLE 7 TRUSTEE...................................................................................... 43
SECTION 7.01.......... DUTIES OF TRUSTEE.......................................................... 43
SECTION 7.02.......... RIGHTS OF TRUSTEE.......................................................... 44
SECTION 7.03.......... INDIVIDUAL RIGHTS OF TRUSTEE............................................... 45
SECTION 7.04.......... TRUSTEE'S DISCLAIMER....................................................... 45
SECTION 7.05.......... NOTICE OF DEFAULTS......................................................... 46
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TABLE OF CONTENTS
(continued)
Page
SECTION 7.06 REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES...................................46
SECTION 7.07 COMPENSATION AND INDEMNITY...................................................46
SECTION 7.08 REPLACEMENT OF TRUSTEE.......................................................47
SECTION 7.09 SUCCESSOR TRUSTEE BY MERGER, ETC.............................................48
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION................................................49
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY............................49
SECTION 7.12 MONEY HELD IN TRUST..........................................................49
SECTION 7.13 RIGHT OF TRUSTEE IN CAPACITY OF REGISTRAR OR PAYING AGENT....................49
ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE.....................................................49
SECTION 8.01 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.....................49
SECTION 8.02 LEGAL DEFEASANCE AND DISCHARGE...............................................49
SECTION 8.03 COVENANT DEFEASANCE..........................................................50
SECTION 8.04 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE...................................50
SECTION 8.05 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS...............................................52
SECTION 8.06 REPAYMENT TO COMPANY.........................................................52
SECTION 8.07 REINSTATEMENT................................................................53
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER..............................................................53
SECTION 9.01 WITHOUT CONSENT OF HOLDERS OF NOTES..........................................53
SECTION 9.02 WITH CONSENT OF HOLDERS OF NOTES.............................................54
SECTION 9.03 COMPLIANCE WITH TRUST INDENTURE ACT..........................................55
SECTION 9.04 REVOCATION AND EFFECT OF CONSENTS............................................55
SECTION 9.05 NOTATION ON OR EXCHANGE OF NOTES.............................................56
SECTION 9.06 TRUSTEE TO SIGN AMENDMENTS, ETC..............................................56
ARTICLE 10 SUBORDINATION................................................................................56
SECTION 10.01 NOTES SUBORDINATED TO SENIOR SECURED DEBT....................................56
SECTION 10.02 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC...............................57
SECTION 10.03 PAYMENTS MAY BE PAID PRIOR TO CERTAIN EVENTS.................................57
SECTION 10.04 SUBROGATION..................................................................57
SECTION 10.05 OBLIGATIONS OF THE COMPANY UNCONDITIONAL.....................................58
SECTION 10.06 NOTICE TO TRUSTEE AND PAYING AGENTS..........................................58
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TABLE OF CONTENTS
(continued)
Page
SECTION 10.07 RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF
LIQUIDATING AGENT.............................................................................. 59
SECTION 10.08 TRUSTEE'S RELATION TO SENIOR SECURED DEBT...................................................... 59
SECTION 10.09 SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR
OMISSIONS OF THE COMPANY....................................................................... 59
SECTION 10.10 NOTEHOLDERS AUTHORIZE TRUSTEE AND PAYING AGENT
TO EFFECTUATE SUBORDINATION OF NOTES.......................................................... 60
SECTION 10.11 TRUSTEE'S COMPENSATION NOT PREJUDICED.......................................................... 60
ARTICLE 11 SECURITY DOCUMENTS............................................................................................... 60
SECTION 11.01 COLLATERAL AND SECURITY DOCUMENTS.............................................................. 60
SECTION 11.02 APPLICATION OF PROCEEDS OF COLLATERAL.......................................................... 61
SECTION 11.03 RELEASE OF COLLATERAL.......................................................................... 61
SECTION 11.04 CERTIFICATES OF THE COMPANY.................................................................... 61
SECTION 11.05 OPINION OF COUNSEL............................................................................. 61
SECTION 11.06 RIGHTS OF TRUSTEE UNDER SECURITY AGREEMENT..................................................... 62
ARTICLE 12 MISCELLANEOUS.................................................................................................... 62
SECTION 12.01 TRUST INDENTURE ACT CONTROLS................................................................... 62
SECTION 12.02 NOTICES........................................................................................ 62
SECTION 12.03 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER
HOLDERS OF NOTES............................................................................... 63
SECTION 12.04 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT............................................. 63
SECTION 12.05 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.................................................. 63
SECTION 12.06 RULES BY TRUSTEE AND AGENTS.................................................................... 64
SECTION 12.07 GOVERNING LAW.................................................................................. 64
SECTION 12.08 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.................................................. 64
SECTION 12.09 SUCCESSORS..................................................................................... 64
SECTION 12.10 SEVERABILITY................................................................................... 64
SECTION 12.11 COUNTERPART ORIGINALS.......................................................................... 65
SECTION 12.12 TABLE OF CONTENTS; HEADINGS; ETC............................................................... 65
SECTION 12.13 LEGAL HOLIDAYS................................................................................. 65
SECTION 12.14 NO RECOURSE AGAINST OTHERS..................................................................... 65
SECTION 12.15 DUPLICATE ORIGINALS............................................................................ 65
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EXHIBITS
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Exhibit A Form of Note
Exhibit B Form of Collateral Agency and Security Agreement
Exhibit C-1 Form of Certificate for Exchange or Registration of Transfer of
Definitive Notes
Exhibit C-2 Form of Certificate for Exchange or Registration of Transfer from
Global Note to Definitive Note
Exhibit C-3 Form of Certificate for Exchange or Registration of Transfer from
Definitive Note to Global Note
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INDENTURE, dated as of July 3, 2001, between Imperial Credit
Industries, Inc., a California corporation (the "Company"), and the Chase
Manhattan Bank and Trust Company, National Association, as trustee (the
"Trustee").
Each party agrees as follows for the benefit of each other and for the
equal and ratable benefit of the Holders of the Senior Secured Notes due 2005
(the "Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 DEFINITIONS.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person, and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the voting securities of a Person shall
be deemed to be control.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Agent Members" means members of, or participants in, the Depositary.
"Applicable Procedures" means applicable procedures of the Depositary,
Euroclear or Clearstream, as the case may be.
"Asset Sale" means (a) any sale, lease, transfer or other disposition
(or series of related sales, leases, transfers or dispositions) by the Company,
including any disposition by means of a merger, consolidation or similar
transaction (other than as permitted under Section 5.01) (each referred to for
the purposes of this definition as a "disposition"), of (i) any shares of
Capital Stock of the Bank (other than Bank Trust Preferred Stock or directors'
qualifying shares or shares required by applicable law to be held by a Person
other than the Company or the Bank, as the case may be), (ii) all or
substantially all the assets of any division or line of business of the Company,
(iii) any other assets of the Company outside of the ordinary course of business
of the Company, or (b) any issuance of Capital Stock (other than Bank Trust
Preferred Stock or non-convertible preferred stock that is not Disqualified
Stock) by the Bank, except any such issuance to the Company. Notwithstanding
the foregoing, an "Asset Sale" does not include (a) a disposition by the Company
to a Wholly Owned Subsidiary, (b) a disposition that constitutes a Restricted
Payment permitted by Section 4.09) and (c) any trade or exchange by the Company
of any assets for similar assets of a Related Business owned or held by another
Person; provided that (1) the fair market value of the assets traded or
exchanged by the Company (including any cash or Cash Equivalents to be delivered
by the Company) is reasonably equivalent to the fair market value of the asset
or assets (together with any cash or Cash Equivalents) to be received by the
Company and (2) such exchange is approved by a majority of the directors of the
Company who are not employees of the Company or its Subsidiaries.
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"Bank" means Southern Pacific Bank, a California industrial bank that
is a Subsidiary of the Company.
"Bank Trust Preferred Stock" means equity interests issued by a
special purpose entity which is a wholly-owned subsidiary of the Bank and which
exists for the purpose only of issuing equity interests, investing the gross
proceeds of such equity issuances in debt securities of the Bank and engaging in
other activities necessary or incidental thereto.
"Bankruptcy Law" means Title 11 of the U.S. Code or any similar
federal or state law for the relief of debtors.
"Board of Directors" means, as to any Person, the board of directors
of such Person or any duly authorized committee thereof.
"Board Resolution" means with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person,
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at such time be required to be capitalized on a balance sheet of the
lessee thereof in accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership, partnership
interests (whether general or limited) and (iv) any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars; (ii) Government
Securities (except that for purposes of this definition, Government Securities
must have a remaining Weighted Average Life to Maturity of not more than one
year from the date of investment therein); (iii) commercial paper or other
short-term corporate obligation that has received a rating of at least A-1 or AA
from Standard & Poor's Corporation ("S&P"), P-1 or Aa2 from Moody's Investor
Services, Inc. ("Moody's"), F-1 or AA from Fitch, Inc. ("Fitch"); (iv) time
deposits, certificates of deposit, bank acceptances or bank notes issued by any
bank having capital surplus and undivided profits aggregating at least
$500,000,000 (or the foreign currency equivalent thereof) and at least a high A
rating (or the equivalent) from any two of the following: S&P, Moody's, Thomson
Bankwatch, Inc. or Fitch; (v) money market preferred stocks which, at the date
of acquisition and at all times thereafter, are accorded ratings of at least mid
AA by any two of the following: S&P, Moody's and Fitch; (vi) tax-exempt
obligations that are accorded ratings at the time of investment therein of at
least mid AA (or equivalent short-term ratings) by any two of the following;
S&P, Moody's or Fitch; (vii) master repurchase agreements with foreign or
domestic banks having capital and surplus of not less than $500,000,000 (or the
foreign currency equivalent thereof) or primary dealers so long as (a) such bank
or dealer has a rating of at least mid AA from any two of the following:
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S&P, Moody's or Fitch; (b) such agreements are collateralized with obligations
of the United States government or its agencies at a ratio of 102%, or with
other collateral rated at least mid AA from any two of the following: S&P,
Moody's or Fitch, at a rate of 103% and, in either case marked to market weekly
and (c) such securities shall be held by a third-party agent; (viii) guaranteed
investment contracts and/or agreements of a bank, insurance company or other
institution whose unsecured, uninsured and unguaranteed obligations (or claims-
paying ability) are, at the time of investment therein, rated AAA by any two of
the following: S&P, Moody's or Fitch; (ix) money market funds, the portfolio of
which is limited to investments described in clauses (i) through (viii); (x)
with respect to Non-Domestic Persons, instruments that are comparable to those
described in clauses (i), (ii), (iv) and (vii) in the country in which such Non-
Domestic Person is organized or has its principal business operations; and (xi)
up to $1,000,000 in the aggregate of other financial assets held by
Subsidiaries. In no event shall any of the Cash Equivalents described in clauses
(iii) through (viii), (x) and (xi) above have a final maturity more than one
year from the date of investment therein.
"Change of Control" means the occurrence of one or more of the
following events: (i) a person or entity or group (as that term is used in
Section 13(d)(3) of the Exchange Act) of persons or entities shall have become
the beneficial owner of a majority of the securities of the Company ordinarily
having the right to vote in the election of directors; (ii) during any
consecutive two-year period, individuals who at the beginning of such period
constituted the Board of Directors of the Company (together with any directors
who are members of such Board of Directors of the Company on the date hereof and
any new directors whose election by such Board of Directors of the Company or
whose nomination for election by the shareholders of the Company was approved by
a vote of 66 2/3% of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company then in office; (iii) any
sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all, or substantially all, the assets of the Company
and its Subsidiaries, taken as a whole, to any person or entity or group (as so
defined) of persons, or entities (other than to any Wholly Owned Subsidiary of
the Company); (iv) the merger or consolidation of the Company with or into
another corporation or the merger of another corporation into the Company with
the effect that immediately after such transaction any person or entity or group
(as so defined) of persons or entities shall have become the beneficial owner of
securities of the surviving corporation of such merger or consolidation
representing a majority of the combined voting power of the outstanding
securities of the surviving corporation ordinarily having the right to vote in
the election of directors; or (v) the adoption of a plan relating to the
liquidation or dissolution of the Company.
"Collateral" means, collectively, the Collateral as defined in the
Security Documents that is from time to time subject to the Lien of the Security
Documents, including the Liens, if any, required pursuant to the provisions of
this Indenture.
"Collateral Agent" has the meaning given to such term in the Security
Agreement.
"Company" has the meaning set forth in the preamble hereto.
"Consolidated Leverage Ratio" as of any date of determination means
the ratio of (i) the aggregate amount of all consolidated Indebtedness of the
Company and its Subsidiaries, excluding Warehouse
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Indebtedness, Guarantees thereof, and other Indebtedness permitted to be
incurred pursuant to clauses (c) and (i) of Section 4.10 to (ii) the
Consolidated Net Worth of the Company.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP;
provided that (i) the Net Income (but not loss) of any Person that is not a
Subsidiary or that is accounted for by the equity method of accounting shall be
included only to the extent of the amount of dividends or distributions paid in
cash to the referent Person or a Wholly Owned Subsidiary thereof and (ii) the
cumulative effect of a change in accounting principles shall be excluded.
"Consolidated Net Worth" means, with respect to any Person as of any
date, the sum of (i) the consolidated equity of the common shareholders of such
Person and its consolidated Subsidiaries as of such date plus (ii) the
respective amounts reported on such Person's balance sheet as of such date with
respect to any series of preferred stock (other than Disqualified Stock) that by
its terms is not entitled to the payment of dividends unless such dividends may
be declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such preferred stock, less (x) all write-ups (other than
write-ups resulting from foreign currency translations and write-ups of tangible
assets of a going concern business made within 12 months after the acquisition
of such business) subsequent to the date of this Indenture in the book value of
any asset owned by such Person or a consolidated Subsidiary of such Person, and
(y) all investments as of such date in unconsolidated Subsidiaries and in
Persons that are not Subsidiaries (except, in each case, Permitted Investments
and Investments existing as of such date), all of the foregoing determined in
accordance with GAAP.
"Convertible Subordinated Debt" means the Obligations of the Company
under or in respect of the Company's Convertible Subordinated Notes due 2004.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 12.02 hereof or such other address as the Trustee
may give notice to the Company.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Definitive Notes" means Notes that are in the form of the Note
attached hereto as Exhibit A, that do not include the information called for by
footnotes 1 and 2 thereof.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, until a successor shall have been
appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depositary" shall mean or include such successor.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of
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the Holder thereof, in whole or in part, on or prior to the date that is 91 days
after the date on which the Notes mature.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock of any Person (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).
"Equity Offerings" means any private offering, or any underwritten
primary public offering pursuant to an effective registration statement under
the Securities Act, in each case, of Equity Interests (other than Disqualified
Stock) of the Company.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Indebtedness" means Indebtedness of the Company and its
Subsidiaries (other than Indebtedness under the Warehouse Facilities and
Indebtedness to finance Receivables or repurchase facilities in the ordinary
course of business) in existence on the date of this Indenture, until such
amounts are repaid.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of this Indenture.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which guarantee
or obligations the full faith and credit of the United States is pledged.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"Hedging Obligations" means, with respect to any Person, the net
obligations of such Person under (i) currency exchange or interest rate swap
agreements, currency exchange or interest rate cap agreements and currency
exchange or interest rate collar agreements and (ii) other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates or currency exchange rates or credit or other business risks, in any such
case in the ordinary course of business and not for speculative or investment
purposes.
"Holder" means a holder of any of the Notes.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication), (i) the principal of and premium (if any)
in respect 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, (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
obliga-
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tions of such Person and all obligations of such Person under any title
retention agreement (but excluding trade accounts payable and expense accruals
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 tenth Business
Day following receipt by such Person of a demand for reimbursement following
payment on the letter of credit), (v) all obligations of the type referred to in
clauses (i) through (iv) 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 by means
of any Guarantee, (vi) all obligations of the type referred to in clauses (i)
through (iv) 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 and (vii) to the
extent not otherwise included in this definition, Hedging Obligations of such
Person. The amount of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional obligations as described
above and the maximum liability, upon the occurrence of the contingency giving
rise to the obligation, of any contingent obligations at such date.
Notwithstanding the foregoing, the term "Indebtedness" does not include deposit
liabilities of any Subsidiary, the deposits of which are insured by the Federal
Deposit Insurance Corporation or any successor agency or Indebtedness of any
Subsidiary to the Federal Home Loan Bank of San Francisco or any successor
thereto incurred in the ordinary course of business and secured by qualifying
mortgage loans or mortgage-backed securities or other collateral permitted by
the credit policies of the Federal Home Loan Bank of San Francisco.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business),
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP;
provided that an acquisition of assets, Equity Interests or other securities by
the Company for consideration consisting of Equity Interests of the Company
shall not be deemed to be an Investment.
"Leases" mean any and all agreements for the use, enjoyment or
occupancy of the Real Property and all buildings, improvements and fixtures of
every kind or nature situated thereon.
"Lien" means, with respect to any Person, any mortgage, pledge,
security interest, encumbrance, lien or charge of any kind on the assets of such
Person, including any conditional sale or other title retention agreement or
lease in the nature thereof.
"Master Recapitalization Agreement" means the Master Recapitalization
Agreement dated as of March 29, 2001 by and among the Company and each of the
investors referenced therein.
-6-
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP, excluding, however, (i) any
gain, together with any related provision for taxes on such gain, realized in
connection with any Asset Sale (including, without limitation, dispositions
pursuant to sale and leaseback transactions) and (ii) any extraordinary gain or
loss, together with any related provision for taxes on such extraordinary gain
or loss.
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of the direct costs
relating to such Asset Sale (including, without limitation, legal, accounting
and investment banking fees, and sales commissions) and any relocation expenses
incurred as a result thereof, taxes paid or payable as a result thereof (after
taking into account any available tax credits or deductions and any tax sharing
arrangements), amounts required to be applied to the repayment of Indebtedness
secured by a Lien on the asset or assets that were the subject of such Asset
Sale and any reserve for adjustment in respect of the sale price of such asset
or assets established in accordance with GAAP.
"Non-Domestic Person" means a Person not organized under the laws of
the United States, any State or territory thereof or the District of Columbia.
"Non-Recourse Debt" means Indebtedness: (i) as to which neither the
Company nor any of its Subsidiaries (a) provides credit support of any kind
(including any undertaking, agreement or instrument that would constitute
Indebtedness), or (b) is directly or indirectly liable (as a guarantor or
otherwise); (ii) no default with respect to which would permit (upon notice,
lapse of time or both) any holder of any other Indebtedness (other than the
Notes being offered hereby) of the Company or any of its Subsidiaries to declare
a default on such other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity; and (iii) as to which the
lenders have been notified in writing that they will not have any recourse to
the stock or assets of the Company or any of its Subsidiaries.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.
"Officer's Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, principal financial officer or principal accounting officer
of the Company.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
12.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
-7-
"Permitted Investments" means an Investment by the Company or any
Subsidiary: (i) in a Subsidiary or in the Bank or a Person that will, upon the
making of such Investment, become a Subsidiary; provided, however, that the
primary business of the Subsidiary is a Related Business; (ii) in another Person
if as a result of such Investment such other Person is merged or consolidated
with or into, or transfers or conveys all or substantially all its assets to,
the Company or a Subsidiary; provided, however, that such Person's primary
business is a Related Business; (iii) comprised of Cash Equivalents; (iv)
comprised of Receivables owing to the Company or any Subsidiary if created or
acquired in the ordinary course of business and payable or dischargeable in
accordance with customary banking or trade terms; (v) comprised of payroll,
travel and similar advances to cover matters that are expected at the time of
such advances ultimately to be treated as expenses for accounting purposes and
that are made in the ordinary course of business; (vi) comprised of stock,
mortgages, deeds of trust, obligations or securities received in settlement of
debts created in the ordinary course of business and owing to the Company or any
Subsidiary or in satisfaction of judgments; (vii) in any Person to the extent
such Investment represents the non-cash portion of the consideration received
for an Asset Sale as permitted pursuant to Section 4.08; or (viii) comprised of
Receivables of the Company or any of its Wholly Owned Subsidiaries.
"Permitted Liens" means, with respect to any Person: (a) pledges or
deposits by such Person under worker's compensation laws, unemployment insurance
laws or similar legislation, or good faith deposits in connection with bids,
tenders, contracts (other than for the payment of Indebtedness) or leases to
which such Person is a party, or deposits to secure public or statutory
obligations of such person or deposits of cash or United States government bonds
to secure surety or appeal bonds to which such person is a party, or deposits as
security for contested taxes or import duties or for the payment of rent, in
each case incurred in the ordinary course of business; (b) Liens imposed by law,
such as carriers', warehousemen's and mechanics' Liens, in each case for sums
not yet due or being contested in good faith by appropriate proceedings or other
Liens arising out of judgments or awards against such Person with respect to
which such Person shall then be proceeding with an appeal or other proceedings
for review; (c) Liens for property taxes not yet subject to penalties for non-
payment or which are being contested in good faith and by appropriate
proceedings; (d) Liens in favor of issuers of surety bonds or letters of credit
issued pursuant to the request of and for the account of such Person in the
ordinary course of its business; provided, however, that such letters of credit
do not constitute Indebtedness; (e) minor survey exceptions, minor encumbrances,
easements or reservations of, or rights of others for, licenses, rights of way,
sewers, electric lines, telegraph and telephone lines and other similar
purposes, or zoning or other restrictions as to the use of real property or
Liens incidental to the conduct of the business of such Person or to the
ownership of its properties which were not incurred in connection with
Indebtedness and which do not in the aggregate materially adversely affect the
value of said properties or materially impair their use in the operation of the
business of such Person; (f) Liens securing Indebtedness incurred to finance the
construction, purchase or lease of, or repairs, improvements or additions to,
property of such Person (but excluding Capital Stock of another Person);
provided, however, that the Lien may not extend to any other property owned by
such Person or any of its Subsidiaries at the time the Lien is incurred, and the
Indebtedness secured by the Lien may not be incurred more than 180 days after
the latest of the acquisition, completion of construction, repair, improvement,
addition or commencement of full operation of the property subject to the Lien;
(g) Liens on Receivables owned by the Company or a Subsidiary, as the case may
be, to secure Indebtedness permitted under clause (c) of Section 4.10; (h) Liens
existing on the date of this Indenture; (i) Liens on property or shares of
Capital Stock of another Person at the time such other Person becomes a
Subsidiary of such Person; provided, however, that such Liens are not created,
incurred or assumed in connection with, or in contemplation of, such other
Person becoming such a Subsidiary; provided further, however, that such Lien may
not extend to any other property owned by
-8-
such Person or any of its Subsidiaries; (j) Liens on property at the time such
Person or any of its Subsidiaries acquires the property, including, any
acquisition by means of a merger or consolidation with or into such Person or a
Subsidiary of such Person; provided, however, that such Liens are not created,
incurred or assumed in connection with, or in contemplation of such acquisition;
provided further, however, that the Liens may not extend to any other property
owned by such Person or any of its Subsidiaries; (k) Liens securing Indebtedness
or other obligations of a Subsidiary of such Person owing to such Person or a
Subsidiary of such Person; (l) Liens securing Hedging Obligations; (m) liens on
cash or other assets securing Warehouse Indebtedness of the Company or its
Subsidiaries; (n) Liens to secure any Permitted Refinancing Indebtedness as a
whole, or in part, with any Indebtedness permitted under this Indenture to be
incurred and secured by any Lien referred to in the foregoing clauses; provided,
however, that (x) such new Lien shall be limited to all or part of the same
property that secured the original Lien (plus improvements to or on such
property) and (y) the Indebtedness secured by such Lien at such time is not
increased to any amount greater than the sum of (A) the outstanding, principal
amount of, if greater, committed amount of the Indebtedness, at the time the
original Lien became a Permitted Lien and (B) an amount necessary to pay any
fees and expenses, including premiums, related to such refinancing, refunding,
extension, renewal or replacement; (o) Liens securing deposit liabilities of any
Subsidiary, the deposits of which are insured by the Federal Deposit Insurance
Corporation or any successor agency or Indebtedness of any Subsidiary to the
Federal Home Loan Bank of San Francisco or any successor thereto incurred in the
ordinary course of business and secured by qualifying mortgage loans or
mortgage-backed securities; (p) Liens incurred to secure the Convertible
Subordinated Debt; (q) Liens on assets of Subsidiaries that secure Non-Recourse
Debt of Subsidiaries; and (r) Liens incurred to secure Indebtedness of up to
$25,000,000 in aggregate principal amount which is permitted under Section 4.10
hereof.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Subsidiaries issued in exchange for, or the net proceeds
of which are used to extend, refinance, renew, replace, defease or refund other
Indebtedness of the Company or any of its Subsidiaries; provided that: (i) the
principal amount (or accreted value, if applicable) of such Permitted
Refinancing Indebtedness does not exceed the principal amount (or accreted
value, if applicable) of the Indebtedness so extended, refinanced, renewed,
replaced, defeased or refunded (plus the amount of reasonable expenses incurred
in connection therewith); (ii) such Permitted Refinancing Indebtedness has a
final maturity date no earlier than the final maturity date of, and has a
Weighted Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded; (iii) if the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded is subordinated in right of
payment to the Notes, such Permitted Refinancing Indebtedness has a final
maturity date no earlier than the final maturity date of, and is subordinated in
right of payment to, the Notes on terms at least as favorable to the Holders of
Notes as those contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; (iv) such
Indebtedness is incurred either by the Company or by the Subsidiary who is the
obligor on the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; and (v) such Indebtedness may not include a Guarantee of
indebtedness of a Person that is not a Subsidiary of the Company.
"Permitted Warehouse Indebtedness" means Warehouse Indebtedness in
connection with a Warehouse Facility; provided, however, that (i) the assets as
to which such Warehouse Indebtedness relates are or, prior to any funding under
the related Warehouse Facility with respect to such assets, were eligible to be
recorded as held for sale or investment on the consolidated balance sheet of the
Company in accordance with GAAP, (ii) such Warehouse Indebtedness will be deemed
to be Permitted Warehouse Indebtedness (a) in the
-9-
case of a Purchase Facility, only to the extent the holder of such Warehouse
Indebtedness has no contractual recourse to the Company and its Subsidiaries to
satisfy claims in respect of such Permitted Warehouse Indebtedness in excess of
the realizable value of the Receivables financed thereby, and (b) in the case of
any other Warehouse Facility, only to the extent of the lesser of (A) the amount
advanced by the lender with respect to the Receivables financed under such
Warehouse Facility, and (B) the principal amount of such Receivables and (iii)
any such Indebtedness has not been outstanding in excess of 364 days.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock", as to any Person, means any Equity Interest with
preferential right of payment of dividends or upon liquidation, dissolution or
winding up over Equity Interests of any other class of such Person.
"Purchase Facility" means any Warehouse Facility in the form of a
purchase and sale facility pursuant to which the Company or a Subsidiary of the
Company sells Receivables to a financial institution or investment bank.
"QIBs" means qualified institutional buyers as defined in Rule 144A.
"Real Property" means any interest in any real property or any portion
thereof whether owned in fee or leased or otherwise owned.
"Receivables" means consumer, mortgage and commercial loans, equipment
or other lease receivables and other assets purchased or originated by the
Company or any Subsidiary in the ordinary course of business; provided, however,
that for purposes of determining the amount of a Receivable at any time, such
amount shall be determined in accordance with GAAP, consistently applied, as of
the most recent practicable date.
"Related Business" means any consumer or commercial finance or banking
business, any financial advisory or financial service business, or any
investment or asset management business.
"Responsible Officer," when used with respect to the Trustee, means
any officer assigned to the Corporate Trust Administration office of the Trustee
(or any successor group of the Trustee) or any other officer of the Trustee
assigned to perform the duties of Trustee hereunder 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 Investment" means an Investment other than a Permitted
Investment.
"Rule 144A" means Rules 144A promulgated under the Securities Act.
"SEC" means the Securities and Exchange Commission.
-10-
"Securities Act" means the Securities Act of 1933, as amended.
"Security Agreement" means the Collateral Agency and Security
Agreement, substantially in the form of Exhibit B hereto, as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
the terms hereof and thereof.
"Security Documents" means, collectively, the Security Agreement and
all other security agreements, mortgages, deeds of trust, pledges, collateral
assignments or other instruments evidencing or creating any Security Interest in
favor of the Trustee in all or any portion of the Collateral, in each case as
amended, amended and restated, supplemented or otherwise modified from time to
time in accordance with the terms hereof and thereof.
"Security Interests" means the Liens on the Collateral created by the
Security Documents in favor of the Trustee for its benefit and the benefit of
the Holders of the Notes.
"Senior Indebtedness" means all Indebtedness of the Company or its
Subsidiaries that is not, by its terms, subordinated in right of payment to the
Notes.
"Senior Secured Debt" means the obligations of the Company under or in
respect of the Company's Senior Secured Notes due 2002.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date of this Indenture.
"Stated Maturity" means, with respect to any installment of principal
or interest on any series of Indebtedness, the date on which such payment of
principal or interest was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such principal or interest prior to the date
originally scheduled for the payment thereof.
"Strategic Investor Repurchase Transaction" means the repurchase,
redemption or other retirement for value of any Equity Interests of any
Subsidiary (a) from a strategic partner or investor owning such Equity Interests
that, except for such Investment, would not be an Affiliate of the Company or
its Subsidiaries and (b) in a transaction whose terms comply with the provisions
of Section 4.14 hereof.
"Subsidiary" means, with respect to any Person, (i) any corporation,
limited liability company, association or other business entity of which more
than 50% of the total voting power of shares of Capital Stock 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 or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of that Person (or a combination thereof) and (ii) any partnership (a) the sole
general partner or the managing general partner of which is such Person or a
Subsidiary of such Person or (b) the only general partners of which are such
Person or of one or more Subsidiaries of such Person (or any combination
thereof).
-11-
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-
77bbbb) as in effect on the date on which this Indenture is qualified under the
TIA.
"Transfer Restricted Security" means a security that bears or is
required to bear the legend set forth in Section 2.06 hereof.
"Trustee" means the party named as such in the preamble hereto until a
successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
"Warehouse Facility" means any funding arrangement, including a
Purchase Facility, with a financial institution or other lender or purchaser,
to the extent (and only to the extent) funding thereunder is used exclusively to
finance or refinance the purchase or origination of Receivables by the Company
or a Subsidiary of the Company for the purpose of (i) pooling such Receivables
prior to securitization, (ii) sale or (iii) investment, in each case in the
ordinary course of business.
"Warehouse Indebtedness" means the greater of (x) the consideration
received by the Company or its Subsidiaries under a Warehouse Facility and (y)
in the case of a Purchase Facility, the book value of the Receivables financed
under such Warehouse Facility until such time as such Receivables are (i)
securitized, (ii) repurchased by the Company or its Subsidiaries or (iii) sold
by the counterparty under the Warehouse Facility to a Person who is not an
Affiliate of the Company.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such
Person all of the outstanding Capital Stock or other ownership interests of
which (other than directors' qualifying shares) shall at the time be owned by
such Person or by one or more Wholly Owned Subsidiaries of such Person.
SECTION 1.02 OTHER DEFINITIONS.
Defined in
-Term Section
----- -------
"Asset Sale Offer".................................................................. 4.08
"Asset Sale Offer Amount"........................................................... 4.08
"Asset Sale Offer Period"........................................................... 4.08
"Asset Sale Purchase Date".......................................................... 4.08
"Clearstream"....................................................................... 2.01
"Change of Control Offer"........................................................... 4.07
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Defined in
-Term Section
----- -------
"Change of Control Offer Period".................................................... 4.07
"Change of Control Payment"......................................................... 4.07
"Change of Control Purchase Date"................................................... 4.07
"Covenant Defeasance"............................................................... 8.03
"Custodian"......................................................................... 6.01
"DTC"............................................................................... 2.03
"Euroclear"......................................................................... 2.01
"Event of Default".................................................................. 6.01
"Excess Proceeds"................................................................... 4.08
"Global Note"....................................................................... 2.01
"incur"............................................................................. 4.10
"Legal Defeasance".................................................................. 8.02
"Legal Holiday"..................................................................... 12.13
"Note Custodian".................................................................... 2.03
"outstanding"....................................................................... 2.08
"Paying Agent"...................................................................... 2.03
"Registrar"......................................................................... 2.03
SECTION 1.03 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
"obligor" on the Notes means the Company and any successor obligor
upon the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
-13-
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;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) provisions apply to successive events and transactions;
(6) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement of successor
sections or rules adopted by the SEC from time to time; and
(7) "herein," "hereof," "hereto" and other words of similar import
refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
ARTICLE 2
THE NOTES
SECTION 2.01 FORM AND DATING.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A attached hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. The Company and the Trustee shall approve the form of the Notes and any
notation, legend or endorsement on them. Each Note shall be dated the date of
its issuance and shall show the date of its authentication. The Notes shall be
issued in minimum denominations of $1,000 and integral multiples of $1,000 in
excess thereof. The terms and provisions contained in the Notes shall
constitute, and are hereby expressly made, a part of this Indenture and the
Company and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby.
The Notes shall be issued initially in the form of one or more Global
Notes (the "Global Notes"), which shall be deposited on behalf of the purchasers
of the Notes represented thereby with the Depositary at its New York office (or
with the Trustee as custodian for the Notes), and registered in the name of the
Depositary or a nominee of the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the Global Note may from time to time be increased or
-14-
decreased by adjustments made on the records of the Trustee and the Depositary
or its nominee as hereinafter provided.
The Global Note shall provide that it shall represent the aggregate
amount of outstanding Notes from time to time endorsed thereon and that the
aggregate amount of outstanding Notes represented thereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and redemptions.
Any endorsement of the Global Note to reflect the amount of any increase or
decrease in the amount of outstanding Notes represented thereby shall be made by
the Trustee or the Note Custodian (as hereinafter defined), at the direction of
the Trustee, in accordance with instructions given by the Holder thereof as
required by Section 2.06 hereof.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" for the Euroclear System
("Euroclear") and the "Management Regulations" and "Instructions to
Participants" of Clearstream Banking S.A. ("Clearstream") shall be applicable to
interests in the Global Note that are held by the Agent Members through
Euroclear or Clearstream.
Except as set forth in Section 2.06 hereof, the Global Note may be
transferred, in whole and not in part, only to another nominee of the Depositary
or to a successor of the Depositary or its nominee.
(a) Book-Entry Provisions. This Section 2.01(a) shall apply only to
the Global Note deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.01(a) and Section 2.02, authenticate and deliver the Global Note
that (i) shall be registered in the name of the Depositary or the nominee of the
Depositary and (ii) shall be delivered by the Trustee to the Depositary or
pursuant to the Depositary's instructions or held by the Trustee as custodian
for the Depositary.
Agent Members shall have no rights either under this Indenture with
respect to the Global Note held on their behalf by the Depositary or by the
Trustee as custodian for the Depositary or under such Global Note, and the
Depositary may be treated by the Company, the Trustee and any agent of the
Company or the Trustee as the absolute owner of such Global Note for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by the Depositary or impair, as between the Depositary and its Agent
Members, the operation of customary practices of such Depositary governing the
exercise of the rights of an owner of a beneficial interest in the Global Note.
(b) Definitive Notes. Notes issued in certificated form shall be
substantially in the form of Exhibit A attached hereto (but without
including the text referred to in footnotes 1 and 2 thereto).
SECTION 2.02 EXECUTION AND AUTHENTICATION.
Two Officers shall sign the Notes for the Company by manual or
facsimile signature.
-15-
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Note has
been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company, which may be
delivered from time to time, signed by two Officers, authenticate up to
$169,354,350 in aggregate principal amount of Notes for original issue. The
aggregate principal amount of Notes outstanding at any time may not exceed
$169,354,350 except as provided in Section 2.07 hereof.
The Trustee may, at the expense of the Company, appoint an
authenticating agent acceptable to the Company to authenticate Notes. An
authenticating agent may authenticate Notes 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 an
Agent to deal with the Company or an Affiliate of the Company.
SECTION 2.03 REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency within the City and State of New York where Notes may be
presented for payment ("Paying Agent"). The Registrar shall keep a register of
the Notes and of their transfer and exchange. The Company may appoint one or
more co-registrars and one or more additional paying agents. The term
"Registrar" includes any co-registrar and the term "Paying Agent" includes any
additional paying agent. The Company may change any Paying Agent or Registrar
without notice to any Holder. The Company shall notify the Trustee in writing
of the name and address of any Agent not a party to this Indenture. If the
Company fails to appoint or maintain another entity as Registrar or Paying
Agent, the Trustee shall act as such. The Company may act as Paying Agent or
Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Note.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as custodian with respect to the Global Note (the "Note
Custodian").
SECTION 2.04 PAYING AGENT TO HOLD MONEY IN TRUST.
Prior to each due date of principal and interest on the Notes, the
Company shall deposit with the Paying Agent a sum sufficient to pay such
principal and interest when so becoming due. The Company shall require each
Paying Agent other than the Trustee to agree in writing that the Paying Agent
will hold in trust for the benefit of Holders or the Trustee all money held by
the Paying Agent for the payment of principal of and premium, if any, and
interest on the Notes, and will notify the Trustee in writing of any default by
the Company in making any such payment. While any such default continues, the
Trustee may require a Paying Agent to pay all money
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held by it to the Trustee. The Company at any time may require a Paying Agent to
pay all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Company) shall have no further liability for the
money delivered to the Trustee. If the Company acts as Paying Agent, it shall
segregate and hold in a separate trust fund for the benefit of the Holders all
money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Paying Agent for
the Notes.
SECTION 2.05 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
all Holders and shall otherwise comply with TIA (S) 312(a). If the Trustee is
not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each interest payment date 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 the Holders of
Notes and the Company shall otherwise comply with TIA (S) 312(a).
SECTION 2.06 TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Definitive Notes. When Definitive Notes
are presented by a Holder to the Registrar with a request:
(x) to register the transfer of the Definitive Notes; or
(y) to exchange such Definitive Notes for an equal principal
amount of Definitive Notes of other authorized denominations, the Registrar
shall register the transfer or make the exchange as requested; provided,
however, that the Definitive Notes presented or surrendered for register of
transfer or exchange:
(i) shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed
by such Holder or by his or her attorney, duly authorized in writing and
(ii) in the case of a Definitive Note that is a Transfer
Restricted Security, such request shall be accompanied by the following
additional information and documents, as applicable:
(A) if such Transfer Restricted Security is being delivered
to the Registrar by a Holder for registration in the name of such
Holder, without transfer, or such Transfer Restricted Security is
being transferred to the Company, a certification to that effect
from such Holder (in substantially the form of Exhibit C-1
hereto);
(B) if such Transfer Restricted Security is being
transferred to a QIB in accordance with Rule 144A or pursuant to
an exemption from registration in accordance with Rule 144 under
the Securities Act or pursuant to an effective registration
statement under the Securities Act, a certification to that
effect from such Holder (in substantially the form of Exhibit C-1
hereto);
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(C) if such Transfer Restricted Security is being
transferred to an Institutional Accredited Investor within the
meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under
the Securities Act, a certification to that effect from such
Holder (in substantially the form of Exhibit C-1 hereof); or
(D) if such Transfer Restricted Security is being
transferred in reliance on any other exemption from the
registration requirements of the Securities Act, a certification
to that effect from such Holder (in substantially the form of
Exhibit C-1 hereto) and an Opinion of Counsel from such Holder or
the transferee reasonably acceptable to the Company and to the
Registrar to the effect that such transfer is in compliance with
the Securities Act.
(b) Transfer of a Beneficial Interest in the Global Note for a
Definitive Note.
(i) Any Person having a beneficial interest in the Global Note
may, upon request, subject to the Applicable Procedures, exchange such
beneficial interest for a Definitive Note. Upon receipt by the Trustee of
written instructions or such other form of instructions as is customary for
the Depositary (or Euroclear or Clearstream, if applicable) from the
Depositary or its nominee on behalf of any Person having a beneficial
interest in such Global Note, and, in the case of a Transfer Restricted
Security, the following additional information and documents (all of which
may be submitted by facsimile):
(A) if such beneficial interest is being transferred to the
Person designated by the Depositary as being the beneficial
owner, a certification to that effect from such Person (in
substantially the form of Exhibit C-2 hereto);
(B) if such beneficial interest is being transferred to a
QIB in accordance with Rule 144A or pursuant to an exemption from
registration in accordance with Rule 144 under the Securities Act
or pursuant to an effective registration statement under the
Securities Act, a certification to that effect from the
transferor (in substantially the form of Exhibit C-2 hereto);
(C) if such beneficial interest is being transferred to an
Institutional Accredited Investor within the meaning of Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act, a certification to that effect from the transferor (in
substantially the form of Exhibit C-2 hereto), or
(D) if such beneficial interest is being transferred in
reliance on any other exemption from the registration
requirements of the Securities Act, a certification to that
effect from the transferor (in substantially the form of Exhibit
C-2 hereto) and an Opinion of Counsel to the effect that such
transfer is in compliance with the Securities Act,
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the Trustee or the Note Custodian, at the direction of the Trustee, shall,
in accordance with the standing instructions and procedures existing
between the Depositary and the Note Custodian, cause the aggregate
principal amount of the Global Note to be reduced accordingly and,
following such reduction, the Company shall execute and, the Trustee shall
authenticate and deliver to the transferee a Definitive Note in the
appropriate principal amount.
(ii) Definitive Notes issued in exchange for a beneficial
interest in the Global Note pursuant to this Section 2.06(b) shall be
registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. The Trustee shall
deliver such Definitive Notes to the Persons in whose names such Notes are
so registered. Following any such issuance of Definitive Notes, the
Trustee, as Registrar, shall instruct the Depositary to reduce or cause to
be reduced the aggregate principal amount at maturity of the applicable
Global Note to reflect the transfer.
(c) Restrictions on Transfer and Exchange of the Global Note.
Notwithstanding any other provision of this Indenture (other than the
provisions set forth in subsection (e) of this Section 2.06), a Global Note
may not be transferred as a whole except by the Depositary to a nominee of
the Depositary or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary or any such nominee
to a successor Depositary or a nominee of such successor Depositary.
(d) Transfer and Exchange of a Definitive Note for a Beneficial
Interest in the Global Note. A Definitive Note may not be exchanged for a
beneficial interest in the Global Note except, subject to the Applicable
Procedures, upon satisfaction of the requirements set forth below. Upon
receipt by the Trustee of a Definitive Note, duly endorsed or accompanied
by appropriate instruments of transfer, in form satisfactory to the
Trustee, and, in the case of a Transfer Restricted Security, the following
additional information and documents (all of which may be submitted by
facsimile):
(i) if such beneficial interest is being transferred to the
Person designated by the Depositary as being the beneficial owner, a
certification to that effect from such Person (in substantially the form of
Exhibit C-3 hereto);
(ii) if such beneficial interest is being transferred to QIB in
accordance with the Rule 144A or pursuant to an exemption from registration
in accordance with Rule 144 under the Securities Act or pursuant to an
effective registration statement under the Securities Act, a certification
to that effect from the transferor (in substantially the form of Exhibit
C-3 hereto);
(iii) if such beneficial interest is being transferred to an
Institutional Accredited Investor within the meaning of Rule 501(a)(1),
(2), (3) or (7) of Regulation D under the Securities Act, a certification
to that effect from the transferor (in substantially the form of Exhibit
C-3 hereto); or
(iv) if such beneficial interest is being transferred in
reliance on any other exemption from the registration requirement of the
Securities Act, a certification to that effect from the transferor (in
substantially the form of Exhibit C-3 hereto) and an Opinion of Counsel
from the trans-
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feree or the transferor reasonably acceptable to the Company and to the
Registrar to the effect that such transfer is in compliance with the
Securities Act,
the Trustee shall cancel such Definitive Note in accordance with Section
2.11 hereof and cause, or direct the Note Custodian to cause, in accordance
with the standing instructions and procedures existing between the
Depositary and the Note Custodian, the aggregate principal amount of Notes
represented by the Global Note to be increased accordingly. If no Global
Note is then outstanding, the Company shall issue and, upon receipt of an
authentication order in accordance with Section 2.02 hereof, the Trustee
shall authenticate a new Global Note in the appropriate principal amount.
(e) Authentication of Definitive Notes in Absence of Depositary. If
at any time:
(i) the Depositary for the Notes notifies the Company that the
Depositary is unwilling or unable to continue as Depositary for the Global
Note and a successor Depositary for the Global Note is not appointed by the
Company within 90 days after delivery of such notice; or
(ii) the Company, at its sole discretion, notifies the Trustee
in writing that it elects to cause the issuance of Definitive Notes under
this Indenture; or
(iii) there shall have occurred and be continuing an Event of
Default or any event which after notice or lapse of time or both would be
an Event of Default with respect to the Notes,
then the Company shall execute, and the Trustee shall, upon receipt of an
authentication order in accordance with Section 2.02 hereof, authenticate and
deliver, Definitive Notes in an aggregate principal amount equal to the
principal amount of the Global Note in exchange for such Global Note.
(f) Legends.
(i) Except as permitted by the following paragraphs (ii) and
(iii), each Note certificate evidencing Global Notes and Definitive Notes
(and all Notes issued in exchange therefore or substitution thereof) shall
bear legends in substantially the following form:
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT") AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH BELOW. BY ITS
ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT), (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER
THE SECURITIES ACT OR (C) IT IS AN ACCREDITED INVESTOR (AS DEFINED IN
RULE 501(a)(1), (2), (3), OR (7) UNDER THE SECURITIES ACT (AN
"ACCREDITED INVESTOR")), (2) AGREES THAT IT WILL NOT WITHIN TWO
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YEARS AFTER THE ORIGINAL ISSUANCE OF THIS NOTE RESELL OR OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY
THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL
BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C)
INSIDE THE UNITED STATES TO AN ACCREDITED INVESTOR IN COMPLIANCE WITH
RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT, (D) OUTSIDE
THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE
904 UNDER THE SECURITIES ACT (IF AVAILABLE), (E) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF AVAILABLE), (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, OR (G) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (3)
AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN
CONNECTION WITH ANY TRANSFER OF THIS NOTE, WITHIN TWO YEARS AFTER THE
ORIGINAL ISSUANCE OF THIS NOTE, THE HOLDER MUST, PRIOR TO SUCH
TRANSFER, FURNISH TO THE TRUSTEE AND THE COMPANY SUCH CERTIFICATIONS,
LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY
REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN, THE
TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE
THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
(ii) Upon any sale or transfer of a Transfer Restricted Security
(including any Transfer Restricted Security represented by a Global Note)
pursuant to Rule 144 under the Securities Act or pursuant to an effective
registration statement under the Securities Act:
(A) in the case of any Transfer Restricted Security that is
a Definitive Note, the Registrar shall permit the Holder thereof
to exchange such Transfer Restricted Security for a Definitive
Note that does not bear the legend set forth in (i) above and
rescind any restrictions on the transfer of such Transfer
Restricted Security upon receipt of a certification from the
transferring holder substantially in the form of Exhibit C-1
hereto; and
(B) in the case of any Transfer Restricted Security
represented by a Global Note, such Transfer Restricted Security
shall not be required to bear the legend set forth in (i) above,
but shall continue to be subject to the provisions of Section
2.06(a) and (b) hereof; provided, however, that with respect to
any request for an exchange of a Transfer Restricted Security
that is represented by a Global Note for a Definitive Note that
does not bear the legend set forth in (i) above, which request is
-21-
made in reliance upon Rule 144, the Holder thereof shall certify
in writing to the Registrar that such request is being made
pursuant to Rule 144 (such certification to be substantially in
the form of Exhibit C-2 hereof).
(iii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted Security represented by a
Global Note) in reliance on any exemption from the registration
requirements of the Securities Act (other than exemptions pursuant to Rule
144A or Rule 144 under the Securities Act) in which the Holder or the
transferee provides an Opinion of Counsel to the Company and the Registrar
in form and substance reasonably acceptable to the Company and the
Registrar (which Opinion of Counsel shall also state that the transfer
restrictions contained in the legend are no longer applicable):
(A) in the case of any Transfer Restricted Security that
is a Definitive Note, the Registrar shall permit the Holder
thereof to exchange such Transfer Restricted Security for a
Definitive Note that does not bear the legend set forth in (i)
above and rescind any restriction on the transfer of such
Transferred Restricted Security; and
(B) in the case of any Transfer Restricted Security
represented by a Global Note, such Transfer Restricted Security
shall not be required to bear the legend set forth in (i) above
but shall continue to be subject to the provisions of Section
2.06(a) and (b) hereof.
(g) Cancellation and/or Adjustment of the Global Note. At such time
as all beneficial interests in the Global Note have been exchanged for
Definitive Notes, redeemed, repurchased or canceled, the Global Note shall
be returned to or retained and canceled by the Trustee in accordance with
Section 2.11 hereof. At any time prior to such cancellation, if any
beneficial interest in the Global Note is exchanged for Definitive Notes,
redeemed, repurchased or canceled, the principal amount of Notes
represented by such Global Note shall be reduced accordingly and an
endorsement shall be made on such Global Note, by the Trustee or the Note
Custodian, at the direction of the Trustee, to reflect such reduction.
(h) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Definitive Notes
and the Global Note at the Registrar's request.
(ii) No service charge shall be made to a Holder for any
registration of transfer or exchange, but the Company may require payment
of a sum sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith (other than any such transfer taxes
or similar governmental charge payable upon exchange or transfer pursuant
to Sections 3.07, 4.07, 4.08 and 9.05 hereof).
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(iii) The Registrar shall not be required to register the
transfer of or exchange any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part.
(iv) All Definitive Notes and the Global Note issued upon any
registration of transfer or exchange of Definitive Notes or the Global Note
shall be the valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Definitive
Notes or Global Note surrendered upon such registration of transfer or
exchange.
(v) The Company shall not be required:
(A) to issue, to register the transfer of or to exchange
Notes during a period beginning at the opening of business 15
days before the day of any selection of Notes for redemption
under Section 3.02 hereof and ending at the close of business on
the day of selection; or
(B) to register the transfer of or to exchange any Note
so selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part; or
(C) to register the transfer of or to exchange a Note
between a record date and the next succeeding interest payment
date.
(vi) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Company may deem and
treat the Person in whose name any Note is registered as the absolute owner
of such Note for the purpose of receiving payment of principal of and
interest and premium, if any, on such Notes, and neither the Trustee, any
Agent nor the Company shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Definitive Notes and the
Global Note in accordance with the provisions of Section 2.02 hereof.
The Registrar may rely on information set forth in a certificate
substantially in the form of Exhibit C-1, C-2 or C-3 hereto, and other
certificates and opinions received pursuant to this Section 2.06 and, in the
absence of receipt of such a certificate or opinion, shall not be deemed to have
knowledge of a transfer of an interest in a Global Note absent actual knowledge
of such transfer.
SECTION 2.07 REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company shall issue and the Trustee, upon the written
order of the Company signed by one Officer of the Company, shall authenticate a
replacement Note if the Trustee's requirements and the requirements of Section
8-405(a)(1) of the Uniform Commercial Code are met. If required by the Trustee
or the Company, an indemnity bond must be supplied by the Holder
-23-
that is sufficient in the reasonable judgment of the Trustee and the Company to
protect the Company, the Trustee, any Agent and any authenticating agent from
any loss that any of them may suffer if a Note is replaced. The Company may
charge such Holder for its expenses and the expenses of the Trustee (including
without limitation attorneys' fees and expenses) in replacing a Note.
Every replacement Note is an additional obligation of the Company and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
SECTION 2.08 OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. Except as set forth in Section 2.09 hereof, a Note
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note.
If a Note is replaced pursuant to Section 2.07 hereof (other than a
mutilated Note surrendered for replacement), it ceases to be outstanding unless
the Trustee receives proof satisfactory to it that the replaced Note is held by
a bona fide purchaser. A mutilated Note ceases to be outstanding upon surrender
of such Note and replacement thereof pursuant to Section 2.07 hereof.
If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
SECTION 2.09 TREASURY NOTES.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company shall be considered as though not outstanding, except that for the
purposes of determining whether the Trustee shall be protected in relying on any
such direction, waiver or consent, only Notes that a Trustee knows are so owned
shall be so disregarded.
SECTION 2.10 TEMPORARY NOTES.
Until Definitive Notes are ready for delivery, the Company may prepare
and the Trustee shall authenticate temporary Notes upon a written order of the
Company signed by two Officers of the Company. Temporary Notes shall be
substantially in the form of Definitive Notes but may have variations that the
Company considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Company shall
prepare and the Trustee shall authenticate Definitive Notes in exchange for
temporary Notes.
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Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture.
SECTION 2.11 CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment.
The Trustee and no one else shall cancel all Notes surrendered for registration
of transfer, exchange, payment, replacement or cancellation and shall destroy
cancelled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all cancelled Notes shall be
delivered to the Company. The Company may not issue new Notes to replace Notes
that it has paid or that have been delivered to the Trustee for cancellation.
SECTION 2.12 DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee
in writing of the amount of defaulted interest proposed to be paid on each Note
and the date of the proposed payment. The Company shall fix or cause to be
fixed each such special record date and payment date, provided that no such
special record date shall be less than 10 days prior to the related payment date
for such defaulted interest. At least 15 days before the special record date,
the Company (or, upon the written request of the Company, the Trustee in the
name and at the expense of the Company) shall mail or cause to be mailed to
Holders a notice that states the special record date, the related payment date
and the amount of such interest to be paid.
SECTION 2.13 CUSIP NUMBERS, ETC.
The Company in issuing the Notes may use "CUSIP", "CINS", "ISIN" or
"private placement" numbers (if then generally in use), and, if so, the Trustee
shall indicate the "CUSIP", "CINS", "ISIN" or "private placement" numbers of the
Notes in notices of redemption and related materials as a convenience to Holders
of Notes; provided that any such notice may state that no representation is made
--------
as to the correctness of such numbers either as printed on the Notes or as
contained in any notice of redemption and related materials.
ARTICLE 3
REDEMPTION AND PREPAYMENT
SECTION 3.01 NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days (unless the Trustee consents to a shorter period) but not more
than 60 days before a redemption date, an Officer's Certificate setting forth
(i) the clause of this Indenture pursuant to which the redemption shall occur,
(ii) the redemption date, (iii) the principal amount of Notes to be redeemed and
(iv) the redemption price.
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SECTION 3.02 SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time, the
Trustee shall select the Notes to be redeemed among the Holders of the Notes in
compliance with the requirements of the principal national securities exchange,
if any, on which the Notes are listed or, if the Notes are not so listed, on a
pro rata basis, by lot or such method as the Trustee shall deem fair and
appropriate. In the event of partial redemption by lot, the particular Notes to
be redeemed shall be selected, unless otherwise provided herein, not less than
30 nor more than 60 days prior to the redemption date by the Trustee from the
outstanding Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
SECTION 3.03 NOTICE OF REDEMPTION.
Subject to the provisions of Section 4.08, at least 30 days but not
more than 60 days before a redemption date, the Company shall mail or cause to
be mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price and the amount of accrued interest;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption
date upon surrender of such Note, a new Note or Notes in principal amount
equal to the unredeemed portion shall be issued upon cancellation of the
original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed;
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(h) 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 Notes;
and
(i) if fewer than all the Notes are to be redeemed, the
identification of the particular Notes (or portions thereof) to be redeemed
as well as the aggregate principal amount of Notes to be redeemed and the
aggregate principal amount of Notes to be outstanding after such partial
redemption.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officer's Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.
SECTION 3.04 EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional. Upon surrender to the Paying Agent, such Notes shall be paid at
the Redemption Price stated in the notice, plus accrued interest to the
redemption date. Failure to give notice or any defect in the notice to a Holder
shall not affect the validity of the notice to any other Holder.
SECTION 3.05 DEPOSIT OF REDEMPTION PRICE.
On or before 10:00 a.m. Eastern Time on the redemption date, the
Company shall deposit with the Trustee or with the Paying Agent money sufficient
to pay the redemption price of and accrued interest on all Notes to be redeemed
on that date. The Trustee or the Paying Agent shall promptly return to the
Company any money deposited with the Trustee or the Paying Agent by the Company
in excess of the amounts necessary to pay the redemption price of, and accrued
interest on, all Notes to be redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption whether or not such
Notes are presented for payment. If a Note is redeemed on or after an interest
record date but on or prior to the related interest payment date, then any
accrued and unpaid interest shall be paid to the Person in whose name such Note
was registered at the close of business on such record date. If any Note called
for redemption shall not be so paid upon surrender for redemption because of the
failure of the Company to comply with the preceding paragraph, interest shall be
paid on the unpaid principal from the redemption date until such principal is
paid, and, to the extent lawful, on any interest not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.01
hereof.
SECTION 3.06 NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
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SECTION 3.07 OPTIONAL REDEMPTION.
The Company may redeem the Notes in whole or in part, in integral
multiples of $1,000 only, at the redemption prices (expressed as percentages of
principal amount) set forth below, plus accrued and unpaid interest thereon to
the applicable redemption date if redeemed during the twelve-month period
beginning on July 3, of the years indicated below:
Year Percentage
---- ----------
2001............................................................ 106
2002............................................................ 103
2003 and thereafter............................................. 100
For purposes of this Article 3, a repurchase by the Company of the
Notes in open market purchase transactions shall not be deemed to be a
redemption.
Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Section 3.01 through 3.06 hereof.
SECTION 3.08 MANDATORY REDEMPTION.
Except as set forth under Sections 4.07 and 4.08, the Company shall
not be required to make mandatory redemption or sinking fund payments with
respect to the Notes.
ARTICLE 4
COVENANTS
SECTION 4.01 PAYMENT OF NOTES.
The Company shall pay or cause to be paid the principal of, premium,
if any, and interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent (other than the Company or a Subsidiary), holds on
that date money deposited by the Company in immediately available funds and
designated for and sufficient to pay all principal, premium, if any, and
interest then due. Such Paying Agent shall return to the Company, no later than
five Business Days following the due date for payment, any money (including
accrued interest, if any) that exceeds such amount of principal, premium, if
any, and interest required for payment on the Notes.
The Company shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal at the applicable
interest rate on the Notes to the extent lawful; it shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest (without regard to any applicable grace period)
at the same rate to the extent lawful.
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SECTION 4.02 MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain in the Borough of Manhattan, the City of
New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company shall give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03.
SECTION 4.03 REPORTS.
(a) Within 15 days after such information would be required to be
filed (or is filed) with the SEC and whether or not required by the rules
and regulations of the SEC, so long as any Notes are outstanding, the
Company shall furnish to the Trustee (i) all quarterly and annual financial
information that would be required to be contained in a filing with the SEC
on Forms 10-Q and 10-K if the Company were required to file such Forms,
including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and, with respect to the annual information
only, a report thereon by the Company's certified independent accountants
and (ii) all current reports that would be required to be filed with the
SEC on Form 8-K if the Company were required to file such reports.
(b) For so long as any Notes remain outstanding, the Company shall
furnish to the Holders and to securities analysts and prospective
investors, upon their request, the information required to be delivered
pursuant to Rule 144A(d)(4).
SECTION 4.04 COMPLIANCE CERTIFICATE.
(a) The Company shall deliver to the Trustee, within 120 days after
the end of each fiscal year, an Officer's Certificate stating that a review
of the activities of the Company and its subsidiaries during the preceding
fiscal year has been made under the supervision of the signing Officer with
a view to determining whether each has kept, observed, performed and
fulfilled in all respects its obligations under this Indenture and further
stating, as to such Officer signing such certificate, that to the best of
his knowledge each has kept, observed, performed and fulfilled each and
every covenant contained in this
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Indenture and is not in any respect in default in the performance or
observance of any of the terms, provisions and conditions hereof or thereof
(or, if such Default or Event of Default shall have occurred, describing
all such Defaults or Events of Default of which he may have knowledge and
what action each is taking or proposes to take with respect thereto).
(b) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, within five days after becoming aware of (i) any
Default or Event of Default or (ii) any event of default under any other
mortgage, indenture or instrument as that term is used in Section 6.01(iv)
which permits an acceleration that could become an Event of Default, an
Officer's Certificate specifying such Default, Event of Default or event of
default and what action the Company is taking or proposes to take with
respect thereto.
SECTION 4.05 TAXES
The Company shall, and shall cause each of its Subsidiaries to, pay
prior to delinquency all material taxes, assessments, and governmental levies
except as contested in good faith and by appropriate proceedings.
SECTION 4.06 STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, 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 has
been enacted.
SECTION 4.07 CHANGE OF CONTROL
Upon the occurrence of a Change of Control, each Holder of Notes shall
have the right to require the Company to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of such Holder's Notes pursuant to the
offer described below (the "Change of Control Offer") at an offer price in cash
equal to 10l% of the aggregate principal amount thereof plus accrued and unpaid
interest thereon to the date of purchase (the "Change of Control Payment").
Within 10 days following any Change of Control, the Company shall mail
a notice to each Holder describing the transaction or transactions that
constitute the Change of Control and offering to repurchase Notes pursuant to
the procedures required by this Indenture and described in such notice. The
Company shall comply with the requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations thereunder to the extent such laws
and regulations are applicable in connection with the repurchase of the Notes as
a result of a Change of Control.
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The Change of Control Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the extent
that a longer period is required by applicable law (the "Change of Control Offer
Period"). No later than five Business Days after the termination of the Change
of Control Offer Period (the "Change of Control Purchase Date"), the Company
shall purchase all Notes tendered in response to the Change of Control Offer.
Payment for any Notes so purchased shall be made in the same manner as interest
payments are made.
If the Change of Control Purchase Date is on or after an interest
record date and on or before the related interest payment date, any accrued and
unpaid interest shall be paid to the Person in whose name a Note is registered
at the close of business on such record date, and no additional interest shall
be payable to Holders who tender Notes pursuant to the Change of Control Offer.
On the Change of Control Purchase Date, the Company shall, to the
extent lawful, (a) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (b) deposit with the Paying
Agent an amount equal to the Change of Control Payment in respect of all Notes
or portions thereof so tendered and (c) deliver or cause to be delivered to the
Trustee the Notes so accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions thereof being purchased by the
Company. The Paying Agent shall promptly mail to each Holder of Notes so
tendered the Change of Control Payment for such Notes, and the Trustee shall
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; provided that each such new Note shall be in a
principal amount of $1,000 or an integral multiple thereof. The Company shall
publicly announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Purchase Date.
SECTION 4.08 ASSET SALES.
The Company shall not consummate an Asset Sale in excess of $1,000,000
unless (i) the Company receives consideration at the time of such Asset Sale at
least equal to the fair market value of the assets or Equity Interests issued or
sold or otherwise disposed of and (ii) at least 75% of the consideration
therefor received by the Company is in the form of Cash Equivalents; provided
that the amount of (A) any liabilities (as shown on the Company's most recent
balance sheet excluding contingent liabilities and trade payables) of the
Company that are assumed by the transferee of any such assets pursuant to a
customary novation agreement that releases the Company from further liability
and (B) any securities, notes or other obligations received by the Company from
such transferee that are promptly, but in no event more than 30 days after
receipt, converted by the Company into cash (to the extent of the cash
received), shall be deemed to be cash for purposes of this provision.
Within 360 days after the receipt of any Net Proceeds from an Asset
Sale in an amount less than $5,000,000, the Company may apply such Net Proceeds,
(a) to permanently reduce Senior Indebtedness (other than the Notes) of the
Company, or (b) to an Investment (excluding Guarantees of Indebtedness or other
obligations), the making of a capital expenditure or the acquisition of other
tangible assets, in each case in or with respect to a Related Business. Any Net
Proceeds from Asset Sales that are not applied or invested as provided in the
first sentence of this paragraph shall be deemed to constitute "Excess
Proceeds." When the aggregate amount of Excess Proceeds exceeds $5,000,000,
unless the Company uses such Excess Proceeds within 90
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days to increase the Bank's capital, the Company shall be required to make an
offer to all Holders of Notes (an "Asset Sale Offer") to purchase the maximum
principal amount of Notes that may be purchased out of one-half of the Excess
Proceeds, at an offer price in cash in an amount equal to 100% of the principal
amount thereof plus accrued and unpaid interest thereon to the date of purchase,
in accordance with the procedures set forth in this Indenture. To the extent
that the aggregate amount of Notes tendered pursuant to an Asset Sale Offer is
less than one-half of the Excess Proceeds, the Company may use any remaining
Excess Proceeds (together with one-half of the Excess Proceeds) for general
corporate purposes. Upon completion of such offer to purchase, the amount of
Excess Proceeds shall be reset at zero.
An Asset Sale Offer shall remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law (the "Asset Sale Offer Period"). No later
than five Business Days after the termination of the Asset Sale Offer Period
(the "Asset Sale Purchase Date"), the Company shall purchase the principal
amount of Notes required to be purchased pursuant to this covenant (the "Asset
Sale Offer Amount") or, if less than the Asset Sale Offer Amount has been
tendered, all Notes tendered in response to the Asset Sale Offer. Payment for
any Notes so purchased shall be made in the same manner as interest payments are
made.
If the Asset Sale Purchase Date is on or after an interest record date
and on or before the related interest payment date, any accrued and unpaid
interest shall be paid to the Person in whose name a Note is registered at the
close of business on such record date, and no additional interest shall be
payable to Holders who tender Notes pursuant to the Asset Sale Offer.
On or before the Asset Sale Purchase Date, the Company shall, to the
extent lawful, accept for payment, on a pro rata basis to the extent necessary,
the Asset Sale Offer Amount of Notes or portions thereof tendered pursuant to
the Asset Sale Offer, or if less than the Asset Sale Offer Amount has been
tendered, all Notes tendered, and shall deliver to the Trustee an Officers'
Certificate stating that such Notes or portions thereof were accepted for
payment by the Company in accordance with the terms of this covenant. The
Company, the Depository or the Paying Agent, as the case may be, shall promptly
(but in any case not later than five days after the Asset Sale Purchase Date)
mail or deliver to each tendering Holder an amount equal to the purchase price
of the Notes tendered by such Holder and accepted by the Company for purchase,
and the Company shall promptly issue a new Note, and the Trustee, upon written
request from the Company signed by two Officers shall authenticate and mail or
deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
shall publicly announce the results of the Asset Sale Offer on the Asset Sale
Purchase Date.
SECTION 4.09 RESTRICTED PAYMENTS.
The Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly: (i) declare or pay any dividend or make any other
payment or distribution on account of the Company's or any of its Subsidiaries'
Equity Interests (including, without limitation, any payment in connection with
any merger or consolidation involving the Company) or to the direct or indirect
holders of the Company's or any of its Subsidiaries' Equity Interests in their
capacity as such (other than dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of the Company or dividends or
distributions payable to the Company or any
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Subsidiary); (ii) purchase, redeem or otherwise acquire or retire for value
(including without limitation in connection with any merger or consolidation
involving the Company) any Equity Interests of the Company or any direct or
indirect parent of the Company or other Affiliate of the Company (other than any
such Equity Interests owned by the Company or any Subsidiary of the Company);
(iii) make any payment on or with respect to, or purchase, redeem, defease or
otherwise acquire or retire for value any Indebtedness that is subordinated to
the Notes (other than Notes, Existing Indebtedness and Convertible Subordinated
Debt), except a payment of interest or principal at Stated Maturity; or (iv)
make any Restricted Investment (all such payments and other actions set forth in
clauses (i) through (iv) above being collectively referred to as "Restricted
Payments"), unless, at the time of and after giving effect to such Restricted
Payment:
(a) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof;
(b) at the time of and immediately after giving effect to such
Restricted Payment, the Company would be able to incur at least $1.00 of
additional Indebtedness pursuant to the test in the first sentence of
Section 4.10; and
(c) such Restricted Payment, together with the aggregate of all other
Restricted Payments made by the Company and its Subsidiaries after the date
of this Indenture (excluding Restricted Payments permitted by clauses (x)
and (y) of the next succeeding paragraph), is less than the sum of (i) the
Consolidated Net Income of the Company for the period (taken as one
accounting period) from the beginning of the first fiscal quarter
commencing after the date of this Indenture to the end of the Company's
most recently ended fiscal quarter for which internal financial statements
are available at the time of such Restricted Payment (or, if such
Consolidated Net Income for such period is a deficit, less such deficit),
plus (ii) the aggregate net cash proceeds received by the Company from the
issue or sale since the date of this Indenture of Equity Interests (other
than Disqualified Stock) or of debt securities that have been converted
into such Equity Interests (other than Equity Interests or convertible debt
securities sold to a Subsidiary of the Company and other than Disqualified
Stock or debt securities that have been converted into Disqualified Stock),
(iii) to the extent that any Restricted Investment that was made after the
date of this Indenture is sold for cash or otherwise liquidated or repaid
for cash, the lesser of (A) the cash return of capital with respect to such
Restricted Investment (less the cost of disposition, if any) and (B) the
initial amount of such Restricted Investment, (iv) any dividends received
by the Company or a Wholly Owned Subsidiary the Company, plus (v)
$25,000,000.
The foregoing provisions shall not prohibit: (u) the payment of any
dividend within 60 days after the date of declaration thereof, if at said date
of declaration such payment would have complied with the provisions of this
Indenture; (v) the payment of any dividend on or the redemption, repurchase,
retirement or other acquisition of Bank Trust Preferred Stock; (w) the
redemption, repurchase, retirement or other acquisition of any Equity Interests
in exchange for, or out of the proceeds of, the substantially concurrent sale
(other than to a Subsidiary of the Company) of other Equity Interests (other
than any Disqualified Stock); provided that the amount of any such net cash
proceeds that are utilized for any such redemption, repurchase, retirement or
other acquisition shall be excluded from clause (c)(ii) of the preceding
paragraph; (x) the defeasance, redemption or repurchase of subordinated
Indebtedness with the net cash proceeds from an incurrence of Permitted
Refinancing Indebtedness or the substantially concurrent sale (other than to a
Subsidiary of the Company) of Equity In-
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terests (other than Disqualified Stock); provided that the amount of any such
net cash proceeds that are utilized for any such redemption, repurchase,
retirement or other acquisition shall be excluded from clause (c)(ii) of the
preceding paragraph; (y) the payment of any dividends on or the repurchase,
redemption or other acquisition or retirement for value of any Equity Interests
of the Company or any Subsidiary of the Company held by any member of the
Company's (or any of its Subsidiaries') management pursuant to any management
equity subscription agreement or stock option agreement or other management
agreement or plan; provided that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests shall not exceed
$5,000,000 in any twelve-month period plus the aggregate cash proceeds received
by the Company during such twelve-month period from any reissuance of Equity
Interests by the Company to members of management of the Company and its
Subsidiaries; and (z) the repurchase, redemption or other retirement for value
of any Equity Interests of any Subsidiary in a Strategic Investor Repurchase
Transaction; and no Default or Event of Default shall have occurred and be
continuing immediately after such transaction.
SECTION 4.10 INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume, guaranty or otherwise become
directly or indirectly liable with respect to (collectively, "incur") any
Indebtedness (including Acquired Debt) and the Company shall not permit any of
its Subsidiaries other than the Bank or any Subsidiary of the Bank to issue any
shares of Preferred Stock; provided, however, that the Company or any Subsidiary
may incur Indebtedness (including Acquired Debt) or any Subsidiary may issue
Preferred Stock if, on the date of such incurrence and after giving effect
thereto, the Company's Consolidated Leverage Ratio does not exceed 2.0 to 1.0,
or 1.5 to 1.0 in the case of any Indebtedness in a principal amount in excess of
$75,000,000 (less any subordinated Indebtedness issued pursuant to the
Recapitalization Agreement) which is subordinated to the Notes.
The foregoing provisions shall not apply to:
(a) Indebtedness of the Company and its Subsidiaries existing on the date
of this Indenture;
(b) the incurrence by the Company of Indebtedness represented by the Notes,
the Convertible Subordinated Debt and up to $75,000,000 of Indebtedness (less
any subordinated Indebtedness issued pursuant to the Recapitalization Agreement)
which is subordinated to the Notes and which matures after the Stated Maturity
of the Notes;
(c) the incurrence of Permitted Warehouse Indebtedness by the Company or
any of its Subsidiaries, and any Guarantee by the Company of such Indebtedness
incurred by a Subsidiary, provided, however, that to the extent any such
Indebtedness of the Company or a Subsidiary ceases to constitute Permitted
Warehouse Indebtedness, such Indebtedness shall be deemed to be incurred at such
time by the Company or such Subsidiary, as the case may be;
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(e) the incurrence by the Company or a Subsidiary of Hedging Obligations
directly related to (i) Indebtedness of the Company or a Subsidiary incurred in
conformity with the provisions of this Indenture, (ii) Receivables held by the
Company or its Subsidiaries pending sale, (iii) Receivables of the Company or
its Subsidiaries that have been sold, (iv) Receivables that the Company or a
Subsidiary reasonably expects to purchase or commit to purchase, finance or
accept as collateral, or (v) other assets owned or financed by the Company or
its Subsidiaries in the ordinary course of business; provided, however, that, in
the case of each of the foregoing clauses (i) through (v), such Hedging
Obligations are eligible to receive hedge accounting treatment in accordance
with GAAP as applied by the Company and its Subsidiaries on the date of this
Indenture;
(f) Indebtedness of the Subsidiaries to the Company to the extent that such
Indebtedness constitutes a Permitted Investment of the Company of the type
permitted under the definition of Permitted Investments;
(g) the incurrence by the Company or any of its Subsidiaries of
intercompany Indebtedness owing to the Company or any of its Subsidiaries;
provided, however, that (i) any subsequent issuance or transfer of any Capital
Stock which results in any such Indebtedness being held by a Person other than a
Subsidiary and (ii) any sale or transfer of any such Indebtedness to a Person
that is not either the Company or a Subsidiary shall be deemed, in each case, to
constitute the incurrence of such Indebtedness by the Company or such
Subsidiary, as the case may be;
(h) the incurrence by a Subsidiary of Non-Recourse Debt; provided, however,
that if any such Indebtedness ceases to be Non-Recourse Debt of the Subsidiary,
such event shall be deemed to constitute an incurrence of Indebtedness by a
Subsidiary of the Company;
(i) the maintenance by the Company or any of its Subsidiaries of
Indebtedness incurred to finance Receivables or repurchase facilities in the
ordinary course of business; and
(j) the incurrence by the Company and its Subsidiaries of Indebtedness in
an aggregate principal amount which, together with the principal amount of all
Indebtedness of the Company and its Subsidiaries outstanding on the date of
incurrence (other than Indebtedness otherwise permitted by this Section 4.10),
does not exceed $25,000,000.
SECTION 4.11 LIENS.
The Company shall not, and shall not permit any of its Subsidiaries
to, create, incur or otherwise cause or suffer to exist or become effective any
Lien for the benefit of any Indebtedness ranking pari passu with or junior to
the Notes, other than the Liens created by the Notes, this Indenture and the
Security Documents and the Permitted Liens, upon any property or assets of the
Company or any Subsidiary of the Company or any shares of stock or debt of any
Subsidiary of the Company which owns property or assets, now owned or hereafter
acquired, unless (i) if such lien secures Indebtedness which is pari passu with
the Notes, then the Notes are secured on an equal and ratable basis or (ii) if
such lien secures Indebtedness which is junior to the Notes, any such lien shall
be junior to a lien granted to the holders of the Notes.
-35-
SECTION 4.12 DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES.
The Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, create or otherwise cause to become effective any
encumbrance or restriction on the ability of any Subsidiary to (i)(a) pay
dividends or make any other distributions to the Company or any of its
Subsidiaries (1) on its Capital Stock or (2) with respect to any other interest
or participation in, or measured by, its profits, or (b) pay any indebtedness
owed to the Company or any of its Subsidiaries, (ii) make loans or advances to
the Company or any of its Subsidiaries or (iii) transfer any of its properties
or assets to the Company or any of its Subsidiaries, except for such
encumbrances or restrictions existing under or by reason of (a) Existing
Indebtedness as in effect on the date of this Indenture, (b) Warehouse
Facilities as in effect as of the date of the date of this Indenture, and any
amendments, modifications, restatements, renewals, increases, supplements,
refundings, additions, replacements or refinancings thereof; provided that such
amendments, modifications, restatements, renewals, increases, supplements,
refundings, additions, replacements or refinancings are no more restrictive with
respect to such dividend and other payment restrictions than those contained in
the Warehouse Facilities as in effect on the date of this Indenture, (c) this
Indenture and the Notes, (d) applicable law, regulation or order of or agreement
with a governmental authority, (e) any instrument governing Indebtedness or
Capital Stock of a Person acquired by the Company or any of its Subsidiaries as
in effect at the time of such acquisition (except to the extent such
Indebtedness was incurred in connection with or in contemplation of such
acquisition), which encumbrance or restriction is not applicable to any Person,
or the properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired; provided that, in the case of
Indebtedness, such Indebtedness was permitted by the terms of this Indenture to
be incurred, (f) by reason of customary non-assignment provisions in Leases
entered into in the ordinary course of business and consistent with past
practices, (g) purchase money obligations for property acquired in the ordinary
course of business that impose restrictions of the nature described in clause
(iii) above on the property so acquired, or (h) Permitted Refinancing
Indebtedness; provided that the restrictions contained in the agreements
governing such Permitted Refinancing Indebtedness are no more restrictive than
those contained in the agreements governing the Indebtedness being refinanced.
SECTION 4.13 BUSINESS ACTIVITIES.
The Company shall not, and shall not permit any Subsidiary to, engage
in any line of business that is not a Related Business (except as a result of
Investments in other businesses made or acquired in connection with the
activities or conduct of the Related Businesses in the ordinary course of
business by the Company and its Subsidiaries, including Investments obtained as
a result of the foreclosure of Liens securing amounts lent by the Company or any
of its Subsidiaries).
SECTION 4.14 TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not permit any of its Subsidiaries
to, make any payment to, or sell, lease, transfer or otherwise dispose of any of
its properties or assets to, or purchase any property or assets from, or enter
into or make or amend any contract, agreement, understanding, loan, advance or
guarantee with, or for the benefit of, any Affiliate (each of the foregoing, an
"Affiliate Transaction"), unless (i) such Affiliate Transaction is on terms that
are no less favorable to the Company or the relevant Subsidiary than those that
would have been obtained in a comparable transaction by the Company or such
Subsidiary with an unrelated Person and (ii) the Company delivers to the Trustee
(a) with respect to any Affiliate Transaction or series of re-
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lated Affiliate Transactions involving aggregate consideration in excess of
$2,000,000, a resolution of the Board of Directors set forth in an Officers'
Certificate certifying that such Affiliate Transaction complies with clause (i)
above and that such Affiliate Transaction has been approved by a majority of the
disinterested members of the Board of Directors and (b) with respect to any
Affiliate Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $10,000,000, in addition to such Officers'
Certificate, an opinion as to the fairness to the Holders of such Affiliate
Transaction from a financial point of view issued by an investment banking firm
of national standing which is not an Affiliate of the Company; provided,
however, that such fairness opinion shall not be required with respect to a
transaction that is made in the ordinary course of business of the Company or
such Subsidiary, as the case may be, and is consistent with the past business
practice of the Company or such Subsidiary. Notwithstanding the foregoing, the
following shall not be deemed Affiliate Transactions: (i) any employment
agreement entered into by the Company or any of its Subsidiaries in the ordinary
course of business and consistent with the past practice of the Company or such
Subsidiary, (ii) any issuance of securities, or other payments, compensation,
benefits, awards or grants in cash, securities or otherwise pursuant to, or the
funding of, employment arrangements, stock options and stock ownership plans
approved by the Board of Directors in the ordinary course of business and
consistent with the past practice of the Company or such Subsidiary, (iii) the
grant of stock options or similar rights to employees and directors of the
Company pursuant to plans approved by the Board of Directors in the ordinary
course of business and consistent with the past practice of the Company or such
Subsidiary, (iv) loans or advances to employees in the ordinary course of
business in accordance with the past practice of the Company or its
Subsidiaries, but in any event not to exceed $500,000 in aggregate principal
amount outstanding at any one time, (v) the payment of reasonable fees to
directors of the Company and its Subsidiaries who are not employees of the
Company or its Subsidiaries, (vi) transactions between or among the Company
and/or its Subsidiaries and (vii) Restricted Payments and Permitted Investments
(other than Strategic Investor Repurchase Transactions) that are permitted by
Section 4.09.
ARTICLE 5
SUCCESSORS
SECTION 5.01 MERGER, CONSOLIDATION OR SALE OF ASSETS.
The Company shall not consolidate or merge with or into (whether or
not the Company is the surviving corporation), or sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of its properties or
assets in one or more related transactions, to another Person unless: (i) the
Company is the surviving corporation or the entity or the Person formed by or
surviving any such consolidation or merger (if other than the Company) or to
which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made is a corporation organized or existing under the laws of
the United States, any state thereof or the District of Columbia; (ii) the
entity or Person formed by or surviving any such consolidation or merger (if
other than the Company) or the entity or Person to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made assumes
all the Obligations of the Company under the Notes, this Indenture and the
Security Documents pursuant to a supplemental Indenture in a form reasonably
satisfactory to the Trustee; and (iii) immediately after such transaction no
Default or Event of Default exists.
The Company shall deliver to the Trustee prior to the consummation of
the proposed transaction an Officer's Certificate to the foregoing effect and an
Opinion of Counsel stating that the proposed transac-
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tion and such supplemental indenture if applicable comply with this Indenture.
The Trustee shall be entitled to conclusively rely and shall be fully protected
in acting or refraining from acting upon such Officer's Certificate and Opinion
of Counsel.
SECTION 5.02 SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, lease, conveyance or
other disposition of all or substantially all of the assets of the Company in
accordance with Section 5.01, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
lease, conveyance or other disposition is made shall succeed to, and be
substituted for (so that from and after the date of such consolidation, merger,
sale, lease, conveyance or other disposition, the provisions of this Indenture
referring to the "Company" shall refer instead to the successor corporation and
not to the Company), and may exercise every right and power of the Company under
this Indenture with the same effect as if such successor Person had been named
as the Company herein; provided, however, that the Company shall not be released
or discharged from the obligation to pay the principal of or interest on the
Notes.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 EVENTS OF DEFAULT.
Each of the following constitutes an "Event of Default":
(i) default for 30 days in the payment when due of interest on
the Notes;
(ii) default in payment when due of the principal of or premium,
if any, on the Notes;
(iii) failure by the Company for 60 days after notice to comply
with any of its other covenants, agreements or warranties in this
Indenture, the Notes or the Security Documents;
(iv) default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company (or the payment of which is
guaranteed by the Company) whether such Indebtedness or guarantee now
exists, or is created after the date hereof, which default results in the
acceleration of such Indebtedness prior to its express maturity and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness the maturity of which has
been so accelerated, aggregates $5.0 million or more;
(v) failure by the Company or any of its Significant
Subsidiaries to pay final judgments aggregating in excess of $5.0 million,
which judgments are not paid, discharged or stayed for a period of 60 days;
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(vi) other than as permitted under the Security Documents or the
terms of this Indenture, any of the Security Documents cease to be in full
force and effect, or any of the Security Documents cease to give the
Trustee the Security Interests, rights, powers and privileges purported to
be created thereby, or any Security Document is declared null and void, or
the Company shall deny or disaffirm any of its obligations under any
Security Document or any Collateral becomes subject to any Lien other than
Permitted Liens;
(vii) the Company or any of its Significant Subsidiaries or any
group of Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary pursuant to or within the meaning of 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 all or substantially all of its property,
(D) makes a general assignment for the benefit of its
creditors, or
(E) generally is not paying its debts as they become due;
or
(viii) a court of competent jurisdiction enters an order or
decree in an involuntary case or proceeding under any Bankruptcy Law that:
(A) is for relief against the Company or any of its
Significant Subsidiaries in an involuntary case;
(B) appoints a Custodian of the Company or any of its
Significant Subsidiaries or for all or substantially all of their
property; or
(C) orders the liquidation of the Company or any of its
Significant Subsidiaries;
and the order or decree remains unstayed and in effect for 60 consecutive
days.
The term "Custodian" means any receiver, trustee, assignee, liquidator
or similar official under any Bankruptcy Law.
SECTION 6.02 ACCELERATION.
If an Event of Default (other than an Event of Default specified in
clauses (vii) and (viii) of Section 6.01, with respect to the Company or any
Significant Subsidiary) occurs and is continuing, the Trustee
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by notice to the Company, or the Holders of at least 25% in principal amount of
the then outstanding Notes by written notice to the Company and the Trustee, may
declare the unpaid principal of and any accrued interest on all the Notes to be
due and payable immediately. Upon such declaration the principal and interest
shall be due and payable immediately. If an Event of Default specified in clause
(vii) or (viii) of Section 6.01 occurs with respect to the Company or any
Significant Subsidiary, such an amount shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder. In the event of a declaration of acceleration of the
Notes because an Event of Default in Section 6.01(iv) hereof has occurred and is
continuing, such declaration of acceleration shall be automatically annulled if
the holders of the Indebtedness described in Section 6.01(iv) hereof have
rescinded the declaration of acceleration in respect of such Indebtedness within
15 Business Days thereof and if (i) the annulment of such acceleration would not
conflict with any judgment or decree of a court of competent jurisdiction, (ii)
all existing Events of Default, except non-payment of principal, interest which
shall have become due solely because of the acceleration, have been cured or
waived and (iii) the Company has delivered an Officer's Certificate to the
Trustee to the effect of clauses (i) and (ii) above. In accordance with the
provisions of Section 6.04, the Holders of a majority in principal amount of the
then outstanding Notes by written notice to the Trustee may rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal or interest that has become due solely because of the acceleration)
have been cured or waived.
SECTION 6.03 OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal and interest on
the Notes or to enforce the performance of any provision of the Notes, this
Indenture or the Security Documents.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
Each Holder, by accepting a Note, acknowledges that the exercise of
remedies by the Trustee with respect to the Collateral is subject to the terms
and conditions of the Security Documents and the proceeds received upon
realization of the Collateral shall be applied by the Trustee in accordance with
the Security Agreement and Section 6.10 of this Indenture.
SECTION 6.04 WAIVER OF PAST DEFAULTS.
Holders of a majority in aggregate principal amount of the Notes then
outstanding by written notice to the Trustee may on behalf of the Holders of all
of the Notes waive any existing Default or Event of Default and its consequences
under this Indenture (except a continuing Default or Event of Default in the
payment of interest or premium on, or the principal of, any Note held by a non-
consenting Holder or a Default in respect of a provision that under Section 9.02
cannot be amended without the consent of each Holder affected thereby). Upon
any such waiver, such Default shall cease to exist, and any Event of Default
arising therefrom
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shall be deemed to have been cured for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.
SECTION 6.05 CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or power conferred on it
hereunder or under the Security Documents. However, the Trustee may refuse to
follow any direction that conflicts with law, this Indenture or the Security
Documents or that the Trustee determines may be unduly prejudicial to the rights
of other Holders of Notes or that may involve the Trustee in personal liability.
SECTION 6.06 LIMITATION ON SUITS.
A Holder of a Note may pursue a remedy with respect to this Indenture,
the Notes or the Security Documents only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the
remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights
of another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
SECTION 6.07 RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal and interest on the Note,
on or after the respective due dates expressed in the Note (including in
connection with an offer to purchase), 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 except to the extent that the
institution or prosecution of such suit or the entry of judgment therein would,
under applicable law, result in the surrender, impairment or waiver of the Lien
of this Indenture and the Security Documents upon the Collateral.
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SECTION 6.08 COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(i) or (ii) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount of
principal and interest remaining unpaid on the Notes, interest on overdue
principal and, to the extent lawful, interest and such further amount as shall
be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel including, but not limited to, all amounts owing to the
Trustee under Section 7.07 herein.
SECTION 6.09 TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any Custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, and any other amounts due the Trustee under Section 7.07
hereof. To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.07 hereof out of the estate in any such
proceeding, shall be denied for any reason, payment of the same shall be secured
by a Lien on, and shall be paid out of, any and all distributions, dividends,
money, securities and other properties that the Holders may be entitled to
receive in such proceeding whether in liquidation or under any plan of
reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10 PRIORITIES.
Subject to the provisions of Article 10 hereof, if the Trustee
collects any money pursuant to this Article 6, it shall pay out the money in the
following order:
First: to the Trustee, its agents and attorneys for any amounts due
under Section 7.07 hereof, including payment of all compensation, expense
and liabilities incurred, and all advances made, by the Trustee and the
costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium, and interest ratably, without preference or
priority of any kind, according to the amounts due and payable on the Notes
for principal, premium and interest, respectively; and
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Third: without duplication, to Holders of Notes for any other
Obligations owing to the Holders of Notes under the Notes or this
Indenture; and
Fourth: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders.
SECTION 6.11 UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may 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 6.11 does not apply to a suit by the Trustee, a suit by a Holder of
a Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
SECTION 7.01 DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the duties, rights and powers vested in it by this
Indenture and the Security Documents, 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 his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties and responsibilities of the Trustee shall be
determined solely by the express provisions of this Indenture and of the
Security Documents and the Trustee need perform only those duties that are
specifically set forth in this Indenture or the Security Documents and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee.
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any statements, certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture and the Security Documents. However, the Trustee shall
examine the statements, certificates and opinions to determine whether or
not they conform to the requirements of this Indenture or the Security
Documents.
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(c) The Trustee shall not be relieved from liabilities 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 7.01;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is conclusively
determined by a court of competent jurisdiction 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 hereof or any other direction of
the Company or Holders permitted under this Indenture.
(d) Whether or not therein expressly so provided, every provision of
this Indenture or the Security Documents that in any way relates to the
Trustee is subject to paragraphs (a), (b), and (c) of this Section 7.01 and
Sections 315 and 316 of the TIA.
(e) No provision of this Indenture or the Security Documents shall
require the Trustee to expend or risk its own funds or incur any liability
whatsoever, financial or otherwise, in the performance of any of its duties
hereunder or under the Security Documents or in the exercise of any of its
rights or powers hereunder or under any Security Documents. The Trustee
shall be under no obligation to exercise any of its duties under this
Indenture or under the Security Documents at the request of any Holders,
unless such Holder shall have offered to the Trustee security or indemnity
satisfactory to it against any loss, liability or expense that might be
incurred by it in compliance with such request or direction.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money
held in trust by the Trustee need not be segregated from other funds except
to the extent required by law.
(g) All indemnifications and releases from liability granted herein to
the Trustee shall extend to the directors, officers, employees and agents
of the Trustee and to the Paying Agent and Registrar.
SECTION 7.02 RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval or other paper or 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 any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval or other paper or document, but the Trustee may, in its
discretion, make such further
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inquiry or investigation into such facts or matters as it may see fit, and,
if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or attorney.
(b) Before the Trustee acts or refrains from acting, it shall be
entitled to an Officer's Certificate or an Opinion of Counsel or both. Such
opinion or certificate shall be full warrant to the Trustee for any action
taken, suffered or omitted by it under the provisions of this Agreement
upon the faith thereof, and the Trustee shall not be liable for any action
it takes or omits to take in good faith in reliance on such Officer's
Certificate or Opinion of Counsel. The Trustee may consult with counsel and
the advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection from liability in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through agents, attorneys, custodians or
nominees and shall not be responsible for the misconduct or negligence of
any agents, attorneys, custodians or nominees 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 conferred upon it by this Indenture or the Security
Documents; provided, however, that the Trustee's conduct does not
constitute gross negligence or willful misconduct.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient
if signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture or the Security Documents
at the request or discretion of any of the Holders unless such Holders
shall have offered to the Trustee Security or indemnity satisfactory to it
against any loss, liability or expense that might be incurred by it in
compliance with such request or direction.
SECTION 7.03 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or an
Affiliate with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. However, the Trustee is subject to Sections
7.10 and 7.11. Subject to the provisions of Section 310(b) of the TIA, the
Trustee shall be permitted to engage in transactions with the Company and its
Subsidiaries other than those contemplated by this Indenture.
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, the Notes or the Security
Documents. It shall not be accountable for the Company's use or application of
the proceeds from the Notes or any money paid to the Company or upon the
Company's direction under any provision of this Indenture or the Security
Documents, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible
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for any statement or recital herein or any statement in the Notes or the
Security Documents or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.
SECTION 7.05 NOTICE OF DEFAULTS.
The Trustee shall not be deemed to have notice of a Default or an
Event of Default unless (i) the Trustee has received written notice thereof from
the Company or any Holder or (ii) a Responsible Officer of the Trustee shall
have actual knowledge thereof. Except as otherwise expressly provided herein,
the Trustee shall not be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein, or
of any of the documents executed in connection with the Notes, or as to the
existence of a Default or Event of Default hereunder.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders a notice of the Default
or Event of Default within 90 days after it obtains knowledge of the existence
of such Event of Default. Except in the case of a Default or Event of Default
in payment of principal, premium, if any, and interest on any Note, the Trustee
shall be protected in withholding such notice if and so long as the Trustee in
good faith determines that withholding the notice is in the interests of
Holders.
SECTION 7.06 REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.
Within 60 days after each October 15 beginning with the October 15
following the date of this Indenture, the Trustee shall mail to Holders a brief
report dated as of such reporting date that complies with TIA (S) 313(a) (but
if no event described in TIA (S) 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA (S) 313(b). The Trustee shall also transmit by mail all
reports as required by TIA (S) 313(c).
Commencing at the time this Indenture is qualified under the TIA, a
copy of each report at the time of its mailing to the Holders shall be filed
with the SEC and each stock exchange on which the Notes are listed. The Company
shall promptly notify the Trustee in writing when the Notes are listed on any
stock exchange.
SECTION 7.07 COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee, and the Trustee shall be
entitled to, compensation for its acceptance of this Indenture and services
hereunder and under the Security Documents which shall be agreed to by the
Company and the Trustee in a separate fee agreement. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Company shall reimburse the Trustee promptly upon request for all
reasonable disbursements, advances and expenses incurred or made by it in
addition to the compensation for its services, except any disbursements,
expenses and advances as may be attributable to the Trustee's negligence or
willful misconduct. Such expenses shall include the reasonable compensation,
disbursements and expenses of the Trustee's agents and counsel and other persons
not regularly in its employ.
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The Company shall, jointly and severally, indemnify the Trustee for,
and hold the Trustee, its officers, directors, employees and agents harmless
against any and all losses, liabilities, damages, claims or expenses including
taxes (other than taxes based on the income of the Trustee) incurred by it
arising out of or in connection with the acceptance or administration or
performance of its duties under this Indenture, the Notes and the Security
Documents, except as set forth in the next paragraph. The Trustee shall notify
the Company promptly of any claim for which it may seek indemnity. Failure by
the Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim and the Trustee shall
cooperate in the defense. The Trustee may have separate counsel and the Company
shall pay the reasonable fees and expenses of such counsel. The Company need
not pay for any settlement made without its consent, which consent shall not be
unreasonably withheld or delayed.
The Company need not reimburse any expense or indemnity against any
loss or liability incurred by the Trustee through its own negligence or bad
faith.
The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture and the resignation or removal
of the Trustee.
To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal of and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge of this Indenture.
The obligations of the Company under this Section to compensate and
indemnify the Trustee and each predecessor Trustee and to pay or reimburse the
Trustee and each predecessor Trustee for expenses, disbursements and advances
shall constitute additional indebtedness hereunder and shall survive the
satisfaction and discharge of this Indenture or the rejection or termination of
this Indenture under any Bankruptcy Law. Such additional indebtedness shall be
a senior claim to that of the Notes upon all property and funds held or
collected by the Trustee as such, except funds held in trust for the benefit of
the Holders of particular Notes or coupons, and the Notes are hereby
subordinated to such senior claim. When the Trustee incurs expenses or renders
services after an Event of Default specified in Section 6.01 (vii) or (viii)
hereof occurs, the parties hereto and the Holders by their acceptance of the
Notes hereby agree that such expenses and the compensation for the services
(including the reasonable fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under any Bankruptcy Law.
SECTION 7.08 REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of Notes of a
majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company may
remove the Trustee if:
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(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Notes of at least 10% in principal amount of the then outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee, after written request by any Holder of a Note who has
been a Holder of a Note for at least six months, fails to comply with Section
7.10, such Holder of a Note may petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture and the Security Documents. The successor Trustee shall
mail a notice of its succession to Holders of the Notes. The retiring Trustee
shall promptly transfer all property held by it as Trustee to the successor
Trustee, provided all sums owing to the Trustee hereunder have been paid and
subject to the Lien provided for in Section 7.07 hereof. Notwithstanding
replacement of the Trustee pursuant to this Section 7.08, the Company's
obligations under Section 7.07 hereof shall continue for the benefit of the
retiring Trustee.
SECTION 7.09 SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall, if such resulting
surviving or transferee corporation is otherwise eligible hereunder, be the
successor Trustee (and the successor to the Trustee under the Security
Documents).
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 Notes 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 Notes so authenticated; and in case at
that time any of the Notes shall not have been authenticated, any successor to
the Trustee may authenticate such Notes either in the name of any predecessor
hereunder or in the name of the successor to the Trustee; and in all such cases
such certificate shall have the full
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force and effect that it is anywhere in the Notes or in this Indenture provided
that the certificate of the Trustee shall have.
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America or of any state thereof authorized under such laws to exercise corporate
trustee power, shall be subject to supervision or examination by Federal or
state authority and shall have (or in the case of a corporation included in a
bank holding company system, the related bank holding company shall have) a
combined capital and surplus of at least $10,000,000 as set forth in its most
recent published annual report of condition.
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated therein.
SECTION 7.12 MONEY HELD IN TRUST.
The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law and except for money held in trust under Article 8 of
this Indenture.
SECTION 7.13 RIGHT OF TRUSTEE IN CAPACITY OF REGISTRAR OR PAYING AGENT.
In the Event that the Trustee is also acting in the capacity of Paying
Agent or Registrar hereunder, the rights and protections afforded to the Trustee
pursuant to this Article 7 shall also be afforded to the Trustee in its capacity
as Paying Agent or Registrar.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors evidenced by
a resolution set forth in an Officer's Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
SECTION 8.02 LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be
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deemed to have been discharged from their obligations with respect to all
outstanding Notes on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance means that
the Company shall be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Notes, which shall thereafter be deemed to be
"outstanding" only for the purposes of Section 8.05 hereof and the other
Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all its other obligations under such Notes and this Indenture (and the
Trustee, on demand of and at the expense of the Company, shall execute proper
instruments acknowledging the same), except for the following provisions which
shall survive until otherwise terminated or discharged hereunder: (a) the rights
of Holders of outstanding Notes to receive solely from the trust fund described
in Section 8.04 hereof, and as more fully set forth in such Section, payments in
respect of the principal of, premium, if any, and interest on such Notes when
such payments are due, (b) the Company's obligations with respect to such Notes
under Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.10 and 2.12 and Section
4.02 hereof, (c) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and the Company's obligations in connection therewith and (d)
this Article 8. Subject to compliance with this Article 8, the Company may
exercise its option under this Section 8.02 notwithstanding the prior exercise
of its option under Section 8.03 hereof.
SECTION 8.03 COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be released from their
obligations under the covenants contained in Sections 4.03, 4.04, 4.05, 4.07,
4.08, 4.09, 4.10, 4.11, 4.12 and 4.13 and Article 5 hereof and the Security
Documents with respect to the outstanding Notes on and after the date the
conditions set forth below are satisfied (hereinafter, "Covenant Defeasance"),
and the Notes shall thereafter be deemed not "outstanding" for the purposes of
any direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to
the outstanding Notes, the Company and its Subsidiaries may omit to comply with
and shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a Default or an Event of Default
under Section 6.01 hereof, but, except as specified above, the remainder of this
Indenture and such Notes shall be unaffected thereby. In addition, upon the
Company's exercise under Section 8.01 hereof of the option applicable to this
Section 8.03 hereof and subject to the satisfaction of the conditions set forth
in Section 8.04 hereof, Sections 6.01 (iii) through 6.01 (vi) hereof and
Sections 6.01(vii) and (viii) (but, in the case of Sections 6.01(vii) and
(viii), only with respect to a Significant Subsidiary) hereof shall not
constitute Events of Default.
SECTION 8.04 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes:
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(a) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 7.10 who shall agree to comply with the provisions of this
Article Eight applicable to it) as trust funds in trust for the purpose of
making the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such Notes, (i) cash in
U.S. Dollars in an amount, or (ii) non-callable Government Securities which
through the scheduled payment of principal and interest in respect thereof
in accordance with their terms will provide, not later than one day before
the due date of any payment, cash in U.S. Dollars in an amount, or (iii) a
combination thereof, in such amounts, as will be sufficient, in the opinion
of a nationally recognized firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee, to pay and
discharge and which shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge the principal of, premium, if any, and
interest on the outstanding Notes on the stated maturity or on the
applicable redemption date, as the case may be, and the Company must
specify whether the Notes are being defeased to maturity or to a particular
redemption date of such principal or installment of principal, premium, if
any, or interest; provided that the Trustee shall have been irrevocably
instructed to apply such money or the proceeds of such non-callable
Government Securities to said payments with respect to the Notes;
(b) In the case of an election under Section 8.02, either (i) (A) the
Notes will become due and payable at their stated maturity within one year
after the date of such election pursuant to Section 8.02 or, within one
year after the date of such election, the Notes will be redeemable at the
option of the Company and will be redeemed by the Company pursuant to
irrevocable instructions issued to the Trustee at the time of such election
for the giving of a notice of redemption by the Trustee for such redemption
and (B) the Company shall have delivered to the Trustee an Opinion of
Counsel in the United States reasonably satisfactory to the Trustee to the
effect that the Holders of the outstanding Notes will not recognize income,
gain or loss for federal income tax purposes as a result of such Legal
Defeasance and will be subject to Federal income tax in the same amount, in
the same manner and at the same times as would have been the case if such
Legal Defeasance had not occurred or (ii) the Company shall have delivered
to the Trustee an Opinion of Counsel in the United States reasonably
satisfactory to the Trustee confirming that (A) the Company has received
from, or there has been published by, the Internal Revenue Service a ruling
or (B) since the date hereof, there has been a change in the applicable
federal income tax law, in either case to the effect that, and based
thereon such opinion shall confirm that, the Holders of the outstanding
Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Legal Defeasance had not
occurred;
(c) In the case of an election under Section 8.03, the Company shall
have delivered to the Trustee an Opinion of Counsel in the United States
reasonably satisfactory to the Trustee to the effect that the Holders of
the outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to Federal income tax in the same amount, in the same manner and at
the same times as would have been the case if such Covenant Defeasance had
not occurred;
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(d) No Default or Event of Default with respect to the Notes shall
have occurred and be continuing on the date of such deposit or, in so far
as Section 6.01(vii) or (viii) is concerned, at any time in the period
ending on the 91st day after the date of such deposit (it being understood
that this condition shall not be deemed satisfied until the expiration of
such period);
(e) Such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, this Indenture or
any other material agreement or instrument to which the Company or any of
its Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound;
(f) In the case of an election under either Section 8.02 or 8.03, the
Company shall have delivered to the Trustee an Officer's Certificate
stating that the deposit made by the Company pursuant to its election under
Section 8.02 or 8.03 was not made by the Company with the intent of
preferring the Holders over other creditors of the Company or with the
intent of defeating, hindering, delaying or defrauding creditors of the
Company or others; and
(g) The Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel in the United States, each stating
that all conditions precedent provided for relating to either the Legal
Defeasance under Section 8.02 or the Covenant Defeasance under Section 8.03
(as the case may be) have been complied with as contemplated by this
Section 8.04.
SECTION 8.05 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and Government Securities
(including the proceeds thereof) deposited with the Trustee (or other qualifying
trustee, collectively for purposes of this Section 8.05, the "Trustee") pursuant
to Section 8.04 hereof in respect of the outstanding Notes shall be held in
trust and applied by the Trustee, in accordance with the provisions of such
Notes and this Indenture, to the payment, either directly or through any Paying
Agent (including the Company acting as Paying Agent) as the Trustee may
determine, to the Holders of such Notes of all sums due and to become due
thereon in respect of principal, premium and interest, but such money need not
be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 hereof or the principal
and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.04(a) hereof), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
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SECTION 8.06 REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of and premium or
interest on any Note and remaining unclaimed for one year after such principal
and premium or interest has become due and payable shall be paid to the Company
on its request or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Note shall thereafter, as a creditor, look only to
the Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
written request and expense of the Company cause to be published once, in The
New York Times or The Wall Street Journal (national edition), notice that such
money remains unclaimed and that, after a date specified therein, which shall
not be less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
SECTION 8.07 REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States
dollars or Government Securities in accordance with Section 8.02 or 8.03 hereof,
as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the obligations of the Company under this Indenture and the
Notes shall be revived and reinstated as though no deposit had occurred pursuant
to Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.02 or 8.03
hereof, as the case may be; provided, however, that, if either the Company makes
any payment of principal of and premium or interest on any Note following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the money held by the
Trustee or Paying Agent and provided further that if such order or judgment is
issued in connection with the insolvency, receivership or other similar
occurrence with respect to the Trustee, upon the reinstatement of such
obligations the Company shall be released from its obligations under Sections
4.03, 4.04, 4.05, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12 and 4.13 and Article 5.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01 WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture and subject to the next
succeeding paragraph, the Company and the Trustee may amend or supplement this
Indenture, the Notes or the Security Documents without the consent of any Holder
of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
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(c) to provide for the assumption of the Company's obligations to
Holders of Notes in the case of a merger or consolidation pursuant to
Article 5 hereof, as applicable;
(d) to make any change that would provide any additional rights or
benefits to the Holders of Notes or that does not adversely affect the
legal rights hereunder and under the Security Documents of any Holder of
the Notes;
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA; or
(f) to mortgage, pledge or grant a Security Interest in favor of the
Trustee as additional security for the payment and performance of
obligations under this Indenture and the Notes, in any property or assets,
including any which are required to be mortgaged, pledged or hypothecated,
or in which a Security Interest is required to be granted pursuant to the
provisions of the Security Documents or otherwise.
Upon the written request of the Company accompanied by a resolution of
its Board of Directors of the Company authorizing the execution of any such
amended or supplemental Indenture, and upon receipt by the Trustee of the
documents described in Section 9.06 hereof, the Trustee shall join with the
Company in the execution of any amended or supplemental Indenture authorized or
permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations that may be therein contained, but the Trustee shall
not be obligated to enter into such amended or supplemental Indenture that
affects its own rights, duties or immunities under this Indenture or otherwise.
SECTION 9.02 WITH CONSENT OF HOLDERS OF NOTES.
The Company and the Trustee may amend or supplement this Indenture or
the Notes with the written consent of the Holders of at least a majority in
principal amount of the then outstanding Notes (including consents obtained in
connection with a tender offer or exchange offer for the Notes) and any existing
Default (including, without limitation, an acceleration of the Notes) or
compliance with any provision of this Indenture or the Notes may be waived with
the written consent of the Holders of at least a majority in principal amount of
the then outstanding Notes (including consents obtained in connection with a
tender offer or exchange offer for the Notes).
Upon the written request of the Company, accompanied by a resolution
of its Board of Directors authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders as aforesaid, and upon receipt by the
Trustee of the documents described in Section 9.06 hereof, the Trustee shall
join with the Company in the execution of such supplemental indenture unless
such supplemental indenture affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such supplemental
indenture.
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It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment or waiver, but
it shall be sufficient if such consent approves the substance thereof.
After a supplement, amendment or waiver under this Section becomes
effective, the Company shall mail to the Holders of each Note affected thereby a
notice briefly describing the supplement, amendment or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture,
amendment or waiver. Subject to Sections 6.04(a) and 6.07 hereof, the Holders
of a majority in principal amount of the Notes then outstanding may waive
compliance in a particular instance by the Company with any provision of this
Indenture or the Notes. However, without the consent of each Holder affected, a
supplement, amendment or waiver under this Section may not (with respect to any
Notes held by a non-consenting Holder):
(1) reduce the principal amount of Notes whose Holders must consent to
an amendment, supplement or waiver of this Indenture, the Notes or the
Security Documents;
(2) reduce the principal of or change the fixed maturity of any Note
or alter the provisions with respect to redemption of the Notes other than
pursuant to Sections 4.07 and 4.08 hereof;
(3) reduce the rate of or change the time for payment of interest,
including default interest on any Note;
(4) waive a Default or Event of Default in the payment of principal of
or premium, if any, or interest on any Note (except a rescission of
acceleration of the Notes by the Holders of at least a majority in
aggregate principal amount of the Notes and a waiver of the payment default
that resulted from such acceleration);
(5) make any Note payable in money other than that stated in the Note;
(6) make any change in Section 6.04(a) or 6.07 hereof or in this
sentence of this Section 9.02 or the rights of Holders of Notes to receive
payments of principal of or premium, if any, or interest on any Notes;
(7) waive a redemption payment with respect to any Note (other than a
payment required by the provisions of Sections 4.07 or 4.08 hereof); or
(8) make any change in the foregoing amendment and waiver provisions.
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SECTION 9.03 COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture, the Notes or the
Security Documents shall be set forth in a amended or supplemental Indenture
that complies with the TIA as then in effect.
SECTION 9.04 REVOCATION AND EFFECT OF CONSENTS.
Until a supplement, amendment or waiver becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder or portion of a Note that evidences the same debt as the consenting
Holder's Note, even if notation of the consent is not made on any Note.
However, any such Holder or subsequent Holder may revoke the consent as to its
Note if the Trustee receives written notice of revocation before the date the
waiver or amendment becomes effective. An amendment or waiver becomes effective
in accordance with its terms and thereafter binds every Holder.
The Company may fix a record date for determining which Holders must
consent to such amendment or waiver. If the Company fixes a record date, the
record date shall be fixed at (i) the later of 30 days prior to the first
solicitation of such consent or the date of the most recent list of Holders
furnished to the Trustee prior to such solicitation pursuant to Section 2.05, or
(ii) such other date as the Company shall designate. No such consent shall be
effective for more than 120 days after such record date.
SECTION 9.05 NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about a supplement,
amendment or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall authenticate new Notes
that reflect the supplement, amendment or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06 TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amendment or supplemental indenture
authorized pursuant to this Article 9 if the amendment 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 or refusing to sign such
amendment or supplemental indenture, the Trustee shall be entitled to receive,
if requested, an indemnity satisfactory to it and to receive and, subject to
Section 7.01, shall be fully protected in relying upon, an Officer's Certificate
and an Opinion of Counsel as conclusive evidence that such amendment or
supplemental indenture is authorized or permitted by this Indenture, that it is
not inconsistent herewith, and that it constitutes the legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms. The Company may not sign an amendment or supplemental indenture
until the irrespective Board of Directors approves it.
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ARTICLE 10
SUBORDINATION
SECTION 10.01 NOTES SUBORDINATED TO SENIOR SECURED DEBT.
The Company covenants and agrees, and each Holder of the Notes, by its
acceptance thereof, likewise covenants and agrees, that all Notes shall be
issued subject to the provisions of this Article Ten; and each Person holding
any Note, whether upon original issue or upon registration of transfer,
assignment or exchange thereof, accepts and agrees that the payment of all
Obligations on the Notes by the Company shall, to the extent and in the manner
herein set forth, be subordinated and junior in right of payment to the prior
payment in full in cash or Cash Equivalents of all Obligations on or in respect
of Senior Secured Debt to the extent set forth herein; that the subordination is
for the benefit of, and shall be enforceable directly by, the holders of Senior
Secured Debt, and that each holder of Senior Secured Debt whether now
outstanding or hereafter created, incurred, assumed or guaranteed shall be
deemed to have acquired Senior Secured Debt in reliance upon the covenants and
provisions contained in this Indenture and the Notes.
SECTION 10.02 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
Until all Senior Secured Debt shall have been paid in full, exchanged
for Notes or otherwise retired, in the event of:
(a) the occurrence of an Event of Default (as such term is defined in
the Senior Secured Debt) and continuance thereof beyond any grace period
provided in the Senior Secured Debt;
(b) any acceleration of the maturity of any other Indebtedness of the
Company, or
(c) the institution of any liquidation, dissolution, bankruptcy,
insolvency or similar proceeding relating to the Company or its property,
the Holders of the Notes shall not be entitled to receive and, by execution and
delivery of this Indenture the Holders of the Notes agree not to accept, any
payment of principal or interest until all amounts owing in respect of the
Senior Secured Debt shall have been paid in full; and from and after the
happening of any event described in clause (c) of this Section 10.02, all
payments and distributions of any kind or character (whether in cash, securities
or property) which, except for the provisions hereof, would have been payable or
distributable to or for the benefit of the holders of the Notes, shall be made
to and for the benefit of the Holders of the Senior Secured Debt (who shall be
entitled to make all necessary claims therefore) in accordance with the
priorities of payment set forth herein until all Senior Secured Debt shall have
been paid in full. In the event that any payment or distribution is made with
respect to the Notes in violation of the terms hereof, any Holder receiving such
payment or distribution shall (and, by acceptance of the Exchange Notes, agrees
to) hold it in trust for the benefit of, and shall remit it to, the holders of
the Senior Secured Debt in accordance with the priorities of payment set forth
herein and in the Security Agreement.
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SECTION 10.03 PAYMENTS MAY BE PAID PRIOR TO CERTAIN EVENTS.
Nothing contained in this Article Ten or elsewhere in this Indenture
shall prevent (i) the Company from making payments at any time in respect of
principal of and interest on the Notes, or from depositing with the Trustee any
moneys for such payments, or (ii) the application by the Trustee or such Paying
Agent, as the case may be, of any moneys deposited with it for the purpose of
making such payments of principal of, and interest on, the Notes to the Holders
entitled thereto (provided that, notwithstanding the foregoing, such application
--------
shall be subject to the provisions of Section 10.02). The Company shall give
prompt written notice to the Trustee and each Paying Agent of any event
described in Section 10.02.
SECTION 10.04 SUBROGATION
Subject to the payment in full in cash or Cash Equivalents of all
Senior Secured Debt, the Holders of the Notes shall be subrogated to the rights
of the holders of Senior Secured Debt to receive payments or distributions of
cash, property or securities of the Company applicable to the Senior Secured
Debt until the Notes shall be paid in full; and, for the purposes of such
subrogation, no such payments or distributions to the holders of the Senior
Secured Debt by or on behalf of the Company or by or on behalf of the Holders by
virtue of this Article Ten which otherwise would have been made to the Holders
shall, as between the Company and the Holders of the Notes, be deemed to be a
payment by the Company to or on account of the Senior Secured Debt, it being
understood that the provisions of this Article Ten are and are intended solely
for the purpose of defining the relative rights of the Holders of the Notes, on
the one hand, and the holders of the Senior Secured Debt, on the other hand.
SECTION 10.05 OBLIGATIONS OF THE COMPANY UNCONDITIONAL.
Nothing contained in this Article Ten or elsewhere in this Indenture
or in the Notes is intended to or shall impair, as among the Company, its
creditors other than the holders of Senior Secured Debt, and the Holders, the
obligation of the Company, which is absolute and unconditional, to pay to the
Holders the principal of and any interest on the Notes as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the Holders and creditors of the Company
other than the holders of the Senior Secured Debt, nor shall anything herein or
therein prevent the Holder of any Note or the Trustee on its behalf from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, in respect of cash, property or
securities of the Company received upon the exercise of any such remedy.
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SECTION 10.06 NOTICE TO TRUSTEE AND PAYING AGENTS.
The Company shall give prompt written notice to the Trustee and each
Paying Agent of any fact known to the Company which would prohibit the making of
any payment to or by the Trustee or any Paying Agent in respect of the Notes
pursuant to the provisions of this Article Ten. Regardless of anything to the
contrary contained in this Article Ten or elsewhere in this Indenture, neither
the Trustee nor any Paying Agent shall be charged with knowledge of the
existence of any facts which would prohibit the making of any payment to or by
the Trustee or any Paying Agent unless and until the Trustee or such Paying
Agent, as the case may be, shall have received notice in writing from the
Company, or from a holder of Senior Secured Debt or a representative therefor,
together with proof satisfactory to the Trustee or such Paying Agent, as the
case may be, of such holding of Senior Secured Debt or of the authority of such
representative, and, prior to the receipt of any such written notice, the
Trustee shall be entitled to assume (in the absence of actual knowledge to the
contrary) that no such facts exist.
In the event that the Trustee or any Paying Agent determines in good
faith that any evidence is required with respect to the right of any Person as a
holder of Senior Secured Debt to participate in any payment or distribution
pursuant to this Article Ten, the Trustee or such Paying Agent, as the case may
be, may request such Person to furnish evidence to the reasonable satisfaction
of the Trustee or such Paying Agent, as the case may be, as to the amounts of
Senior Secured Debt held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article Ten. If such evidence
is not furnished to the Trustee or such Paying Agent, as the case may be, the
Trustee or such Paying Agent shall incur no liability and shall be fully
protected in deferring any payment to such Person pending judicial determination
as to the right of such Person to receive such payment.
SECTION 10.07 RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING AGENT.
Upon any payment or distribution of assets of the Company referred to
in this Article Ten, the Trustee, subject to the provisions of Article Seven
hereof, each Paying Agent and the Holders of the Notes shall be entitled to
conclusively rely and shall be fully protected in acting or refraining from
acting upon any order or decree made by any court of competent jurisdiction in
which any insolvency, bankruptcy, receivership, dissolution, winding-up,
liquidation, reorganization or similar case or proceeding is pending, or upon a
certificate of the receiver, trustee in bankruptcy, liquidating trustee,
receiver, assignee for the benefit of creditors, agent or other Person making
such payment or distribution, delivered to the Trustee or the Holders of the
Notes, for the purpose of ascertaining the Persons entitled to participate in
such payment or distribution, the holders of the Senior Secured Debt and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article Ten.
SECTION 10.08 TRUSTEE'S RELATION TO SENIOR SECURED DEBT.
The Trustee, each Agent and any agent of the Company, of the Trustee
or any Agent shall be entitled to all the rights set forth in this Article Ten
with respect to any Senior Secured Debt which may at any time be held by it in
its individual or any other capacity to the same extent as any other holder of
Senior Secured Debt and nothing in this Indenture shall deprive the Trustee, any
Agent or any such agent of any of its rights as such a holder.
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With respect to the holders of Senior Secured Debt, the Trustee and
each Agent undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article Ten, and no implied
covenants or obligations with respect to the holders of Senior Secured Debt
shall be read into this Indenture against the Trustee or any Agent. Neither the
Trustee nor any Agent shall be deemed to owe any fiduciary duty to the holders
of Senior Secured Debt.
Whenever a distribution is to be made or a notice is to be given to
holders or owners of Senior Secured Debt, the distribution may be made and the
notice may be given to their representatives, if any.
SECTION 10.09 SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR OMISSIONS OF THE
COMPANY.
No right of any present or future holders of any Senior Secured Debt
to enforce subordination as provided herein shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms of this Indenture, regardless of any
knowledge thereof which any such holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Secured Debt may, at any time and from time to time,
without the consent of or notice to the Trustee, without incurring
responsibility to the Trustee or the Holders of the Notes and without impairing
or releasing the subordination provided in this Article Ten or the obligations
hereunder of the Holders of the Notes to the holders of the Senior Secured Debt,
do any one or more of the following: (i) change the manner, place or terms of
payment or extend the time of payment of, or renew or alter, Senior Secured
Debt, or otherwise amend or supplement in any manner Senior Secured Debt, or any
instrument evidencing the same or any agreement under which Senior Secured Debt
is outstanding; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Secured Debt; (iii) release any
Person liable in any manner for the payment or collection of Senior Secured
Debt; and (iv) exercise or refrain from exercising any rights against the
Company and any other Person.
SECTION 10.10 NOTEHOLDERS AUTHORIZE TRUSTEE AND PAYING AGENT TO EFFECTUATE
SUBORDINATION OF NOTES.
Each Holder of Notes by its acceptance of them authorizes and
expressly directs the Trustee and each Paying Agent on its behalf to take such
action as may be necessary or appropriate to effectuate, as between the holders
of Senior Secured Debt and the Holders of Notes, the subordination provided in
this Article Ten, and appoints the Trustee and each Paying Agent its attorney-
in-fact for such purposes, including, in the event of any dissolution, winding-
up, liquidation or reorganization of the Company (whether in bankruptcy,
insolvency, receivership, reorganization or similar proceedings or upon an
assignment for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of the Company, the filing of a claim for
the unpaid balance of its Notes and accrued interest in the form required in
those proceedings.
If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the holders of the
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Senior Secured Debt or their representatives are hereby authorized to have the
right to file and are hereby authorized to file an appropriate claim for and on
behalf of the Holders of said Notes. Nothing herein contained shall be deemed to
authorize the Trustee or the holders of Senior Secured Debt or their
representatives to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the
Trustee or the holders of Senior Secured Debt or their representatives to vote
in respect of the claim of any Holder in any such proceeding.
SECTION 10.11 TRUSTEE'S COMPENSATION NOT PREJUDICED.
Nothing in this Article Ten will apply to amounts due to the Trustee
pursuant to other sections in this Indenture.
ARTICLE 11
SECURITY DOCUMENTS
SECTION 11.01 COLLATERAL AND SECURITY DOCUMENTS.
In order to secure the due and punctual payment of the Notes, the
Company has entered into the Security Agreement to create the Security Interests
and for related matters. Subject to the provisions in the Security Agreement
and this Indenture, the Notes shall be secured by the Collateral securing the
Senior Secured Debt and the Convertible Subordinated Debt in accordance with the
terms of the Security Agreement.
Each holder of a Note, by accepting such Note, agrees to all of the
terms and provisions of the Security Agreement, as the same may be amended from
time to time pursuant to the provisions of the Security Agreement and this
Indenture. Additionally, each holder of a Note, by accepting such Note, directs
the Trustee to authorize the release, from time to time, from the security
interest any Pledged Debt or Pledged Securities (as such terms are defined in
the Security Agreement) as contemplated by and pursuant to Section 1 of the
Security Agreement, and each such Holder (for itself and any person or entity
claiming through it) hereby releases, waives, discharges, exculpates and
covenants not to sue the Trustee for authorizing any such release.
SECTION 11.02 APPLICATION OF PROCEEDS OF COLLATERAL
Upon any realization upon the Collateral, the proceeds thereof shall
be applied in accordance with the terms of the Security Agreement.
SECTION 11.03 RELEASE OF COLLATERAL
The Company shall have the right, at any time and from time to time,
to obtain a release of Collateral upon the exchange of other Collateral for such
Collateral in accordance with the terms of the Security Agreement.
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SECTION 11.04 CERTIFICATES OF THE COMPANY
The Company will furnish to the Trustee and the Collateral Agent prior
to any proposed release of any portion or all of the Collateral (a) all
documents required by the TIA, (b) an Officer's Certificate requesting a
release of collateral and describing the property to be so released and (c)
an Opinion of Counsel to the effect that such accompanying documents
constitute all documents required by the TIA. The Trustee and the
Collateral Agent may, to the extent permitted by Sections 7.01 and 7.02
hereof, accept as conclusive evidence of compliance with the foregoing
provisions the statements contained in such instruments.
SECTION 11.05 OPINION OF COUNSEL
The Company shall deliver to the Trustee and the Collateral Agent:
(a) Promptly after the execution and delivery of the Indenture, an
Opinion of Counsel either stating that in the opinion of such counsel the
Indenture has been properly recorded and filed so as to make effective the
lien intended to be created thereby, and reciting the details of such
action, or stating that in the opinion of such counsel no such action is
necessary to make such lien effective;
(b) Within 30 days of July 1 of each year, an Opinion of Counsel
either stating that in the opinion of such counsel such action has been
taken with respect to the recording, filing, recording and refiling of the
Indenture as is necessary to maintain the lien of the Indenture, and
reciting the details of such action, or stating that in the opinion of such
counsel no such action is necessary to maintain such lien.
SECTION 11.06 RIGHTS OF TRUSTEE UNDER SECURITY AGREEMENT
The rights, protections, immunities and indemnities of the Trustee set
forth herein shall apply, mutatis mutandis, to the Trustee under the Security
Agreement.
ARTICLE 12
MISCELLANEOUS
SECTION 12.01 TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture or the Security Agreement limits,
qualifies or conflicts with the duties imposed by TIA (S) 318(c), the imposed
duties shall control to the extent they cannot be disregarded, pursuant to TIA
(S) 314(d).
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SECTION 12.02 NOTICES.
Any notice or communication by the Company or the Trustee to the
others is duly given if in writing and delivered in Person or mailed by first
class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
If to the Company:
Imperial Credit Industries, Inc.
23550 Hawthorne Boulevard
Building 1, Suite 210
Torrance, CA 90505
Telephone:
Telecopier No.: (310) 791-8230
Attention: General Counsel
If to the Trustee:
The Chase Manhattan Bank and Trust Company, National Association
101 California Street
Suite 2725
San Francisco, CA 94111
Telephone: (415) 954-9506
Telecopier No.: (415) 693-8850
Attention: Corporate Trust Department
The Company or the Trustee by written notice to the others may
designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if sent by registered or certified mail; when answered back, if
telexed; when receipt acknowledged, if telecopied; and the next Business Day
after timely delivery to the courier, if sent by overnight air courier
guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA (S) 313(c), to the extent required by the TIA. 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 in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
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SECTION 12.03 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA (S) 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company,
the Trustee, the Registrar and any other Person shall have the protection of TIA
(S) 312(c).
SECTION 12.04 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee, at
the request of the Trustee:
(a) an Officer's Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 12.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 12.05 hereof) stating that, in the opinion of such counsel, all
such conditions precedent and covenants have been satisfied.
SECTION 12.05 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture and the Security Agreement
(other than a certificate provided pursuant to TIA (S) 314(a)(4)) shall comply
with the provisions of TIA (S) 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(b) 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;
(c) a statement that, in the opinion of such Person, he or she 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 satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
SECTION 12.06 RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
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SECTION 12.07 GOVERNING LAW.
The internal law of the State of New York shall govern and be used to
construe this Indenture and the Notes (without regard to conflicts of law
provisions). Each party hereto irrevocably submits itself to the non-exclusive
jurisdiction of the state and federal courts of New York for purposes of this
Indenture and agrees and consents that service of process may be made upon it in
any legal proceeding relating to this Indenture by any means allowed under
federal or New York law. The parties hereto hereby waive and agree not to
assert, by way of motion, as a defense or otherwise, that any such proceeding is
brought in an inconvenient forum or that the venue thereof is improper.
SECTION 12.08 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person.
Any such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 12.09 SUCCESSORS.
All agreements of the Company in this Indenture and the Notes shall
bind their respective successors. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 12.10 SEVERABILITY.
In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 12.11 COUNTERPART 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.
SECTION 12.12 TABLE OF CONTENTS; HEADINGS; ETC.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
SECTION 12.13 LEGAL HOLIDAYS.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in The City of New York or at a place of payment are authorized or
obligated by law, regulation or executive order to remain closed. If a payment
date is a Legal Holiday at a place of payment, payment may be made at that place
on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue for the intervening period.
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SECTION 12.14 NO RECOURSE AGAINST OTHERS.
No director, officer, manager, member, organizer, employee,
incorporator or shareholder of the Company, as such, shall have any liability
for any obligations of the Company under the Notes or this Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. Each Holder by accepting a Note waives and releases all such
liability. This waiver and release are part of the consideration for issuance
of the Notes.
SECTION 12.15 DUPLICATE ORIGINALS.
The parties may sign any number of copies of this Indenture. One
signed copy is enough to prove this Indenture.
[Signatures on following page.]
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SIGNATURES
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Dated as of July 3, 2001 IMPERIAL CREDIT INDUSTRIES, INC.
By: /s/ H. Wayne Snavely
-------------------------
Name:
Title:
THE CHASE MANHATTAN BANK AND
TRUST COMPANY, NATIONAL ASSOCIATION,
as Trustee
By: /s/ Hans H. Helley
----------------------------
Name: Hans H. Helley
Title: Vice President
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