EXHIBIT 10.12
CHANDLER (U.S.A.), INC.
as Issuer
INDENTURE
Dated as of December 16, 2003
WILMINGTON TRUST COMPANY
as Trustee
FLOATING RATE JUNIOR SUBORDINATED DEBT SECURITIES DUE 2034
PAGE i
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions. ...................................................1
ARTICLE II
DEBT SECURITIES
SECTION 2.01 Authentication and Dating. .....................................8
SECTION 2.02 Form of Trustee's Certificate of Authentication. ...............8
SECTION 2.03 Form and Denomination of Debt Securities. ......................8
SECTION 2.04 Execution of Debt Securities. ..................................9
SECTION 2.05 Exchange and Registration of Transfer of Debt Securities. ......9
SECTION 2.06 Mutilated, Destroyed, Lost or Stolen Debt Securities. .........12
SECTION 2.07 Temporary Debt Securities. ....................................13
SECTION 2.08 Payment of Interest. ..........................................13
SECTION 2.09 Cancellation of Debt Securities Paid, etc. ....................15
SECTION 2.10 Computation of Interest. ......................................15
SECTION 2.11 Extension of Interest Payment Period. .........................17
SECTION 2.12 CUSIP Numbers. ................................................17
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01 Payment of Principal, Premium and Interest;
Agreed Treatment of the Debt Securities. ......................18
SECTION 3.02 Offices for Notices and Payments, etc. ........................19
SECTION 3.03 Appointments to Fill Vacancies in Trustee's Office. ...........19
SECTION 3.04 Provision as to Paying Agent. .................................19
SECTION 3.05 Certificate to Trustee. .......................................20
SECTION 3.06 Additional Interest. ..........................................21
SECTION 3.07 Compliance with Consolidation Provisions. .....................21
SECTION 3.08 Limitation on Dividends. ......................................21
SECTION 3.09 Covenants as to the Trust. ....................................22
ARTICLE IV
LISTS
SECTION 4.01 Securityholders' Lists. .......................................22
SECTION 4.02 Preservation and Disclosure of Lists. .........................23
SECTION 4.03 Financial and Other Information. ..............................24
PAGE ii
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
SECTION 5.01 Events of Default. ............................................25
SECTION 5.02 Payment of Debt Securities on Default; Suit Therefor. .........26
SECTION 5.03 Application of Moneys Collected by Trustee. ...................28
SECTION 5.04 Proceedings by Securityholders. ...............................28
SECTION 5.05 Proceedings by Trustee. .......................................29
SECTION 5.06 Remedies Cumulative and Continuing. ...........................29
SECTION 5.07 Direction of Proceedings and Waiver of Defaults by
Majority of Securityholders. ..................................29
SECTION 5.08 Notice of Defaults. ...........................................30
SECTION 5.09 Undertaking to Pay Costs. .....................................30
ARTICLE VI
CONCERNING THE TRUSTEE
SECTION 6.01 Duties and Responsibilities of Trustee. .......................31
SECTION 6.02 Reliance on Documents, Opinions, etc. .........................32
SECTION 6.03 No Responsibility for Recitals, etc. ..........................33
SECTION 6.04 Trustee, Authenticating Agent, Paying Agents, Transfer
Agents or Registrar May Own Debt Securities. ..................33
SECTION 6.05 Moneys to be Held in Trust. ...................................33
SECTION 6.06 Compensation and Expenses of Trustee. .........................34
SECTION 6.07 Officers' Certificate as Evidence. ............................34
SECTION 6.08 Eligibility of Trustee. .......................................35
SECTION 6.09 Resignation or Removal of Trustee. ............................35
SECTION 6.10 Acceptance by Successor Trustee. ..............................37
SECTION 6.11 Succession by Merger, etc. ....................................37
SECTION 6.12 Authenticating Agents. ........................................38
ARTICLE VII
CONCERNING THE SECURITYHOLDERS
SECTION 7.01 Action by Securityholders. ....................................39
SECTION 7.02 Proof of Execution by Securityholders. ........................40
SECTION 7.03 Who Are Deemed Absolute Owners. ...............................40
SECTION 7.04 Debt Securities Owned by Company Deemed Not Outstanding. ......40
SECTION 7.05 Revocation of Consents; Future Holders Bound. .................41
ARTICLE VIII
SECURITYHOLDERS' MEETINGS
SECTION 8.01 Purposes of Meetings. .........................................41
SECTION 8.02 Call of Meetings by Trustee. ..................................41
SECTION 8.03 Call of Meetings by Company or Securityholders. ...............42
SECTION 8.04 Qualifications for Voting. ....................................42
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SECTION 8.05 Regulations. ..................................................42
SECTION 8.06 Voting. .......................................................43
SECTION 8.07 Quorum; Actions. ..............................................43
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.01 Supplemental Indentures without Consent of Securityholders. ...44
SECTION 9.02 Supplemental Indentures with Consent of Securityholders. ......45
SECTION 9.03 Effect of Supplemental Indentures. ............................46
SECTION 9.04 Notation on Debt Securities. ..................................47
SECTION 9.05 Evidence of Compliance of Supplemental Indenture to be
Furnished to Trustee. .........................................47
ARTICLE X
REDEMPTION OF SECURITIES
SECTION 10.01 Optional Redemption. ..........................................47
SECTION 10.02 Special Event Redemption. .....................................47
SECTION 10.03 Notice of Redemption; Selection of Debt Securities. ...........48
SECTION 10.04 Payment of Debt Securities Called for Redemption. .............48
ARTICLE XI
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 11.01 Company May Consolidate, etc., on Certain Terms. ..............49
SECTION 11.02 Successor Entity to be Substituted. ...........................50
SECTION 11.03 Opinion of Counsel to be Given to Trustee. ....................50
ARTICLE XII
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 12.01 Discharge of Indenture. .......................................50
SECTION 12.02 Deposited Moneys to be Held in Trust by Trustee. ..............51
SECTION 12.03 Paying Agent to Repay Moneys Held. ............................51
SECTION 12.04 Return of Unclaimed Moneys. ...................................52
ARTICLE XIII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
SECTION 13.01 Indenture and Debt Securities Solely Corporate Obligations. ...52
ARTICLE XIV
MISCELLANEOUS PROVISIONS
SECTION 14.01 Successors. ...................................................52
SECTION 14.02 Official Acts by Successor Entity. ............................52
SECTION 14.03 Surrender of Company Powers. ..................................53
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SECTION 14.04 Addresses for Notices, etc. ...................................53
SECTION 14.05 Governing Law. ................................................53
SECTION 14.06 Evidence of Compliance with Conditions Precedent. .............53
SECTION 14.07 Business Day Convention. ......................................54
SECTION 14.08 Table of Contents, Headings, etc. .............................54
SECTION 14.09 Execution in Counterparts. ....................................54
SECTION 14.10 Separability. .................................................54
SECTION 14.11 Assignment. ...................................................54
SECTION 14.12 Acknowledgment of Rights. .....................................54
ARTICLE XV
SUBORDINATION OF DEBT SECURITIES
SECTION 15.01 Agreement to Subordinate. .....................................55
SECTION 15.02 Default on Senior Indebtedness. ...............................55
SECTION 15.03 Liquidation; Dissolution; Bankruptcy. .........................56
SECTION 15.04 Subrogation. ..................................................57
SECTION 15.05 Trustee to Effectuate Subordination. ..........................58
SECTION 15.06 Notice by the Company. ........................................58
SECTION 15.07 Rights of the Trustee; Holders of Senior Indebtedness. ........59
SECTION 15.08 Subordination May Not Be Impaired. ............................59
EXHIBITS
EXHIBIT A Form of Debt Security
EXHIBIT B Form of Officers' Certificate
PAGE 1
THIS INDENTURE, dated as of December 16, 2003, between Chandler (U.S.A.),
Inc., an insurance holding company incorporated in Oklahoma (hereinafter
sometimes called the "Company"), and Wilmington Trust Company, a Delaware
banking corporation, as trustee (hereinafter sometimes called the "Trustee").
W I T N E S S E T H :
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the issuance of its Floating Rate Junior Subordinated Debt
Securities due 2034 (the "Debt Securities") under this Indenture and to
provide, among other things, for the execution and authentication, delivery
and administration thereof, the Company has duly authorized the execution of
this Indenture.
NOW, THEREFORE, in consideration of the premises, and the purchase of the
Debt Securities by the holders thereof, the Company covenants and agrees with
the Trustee for the equal and proportionate benefit of the respective holders
from time to time of the Debt Securities as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINITIONS.
-----------
The terms defined in this Section 1.01 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes
of this Indenture and of any indenture supplemental hereto shall have the
respective meanings specified in this Section 1.01. All accounting terms used
herein and not expressly defined shall have the meanings assigned to such terms
in accordance with generally accepted accounting principles and the term
"generally accepted accounting principles" means such accounting principles
as are generally accepted in the United States at the time of any computation.
The words "herein," "hereof" and "hereunder" and other words of similar import
refer to this Indenture as a whole and not to any particular Article, Section
or other subdivision.
"Additional Interest" has the meaning set forth in Section 3.06.
"Additional Provisions" has the meaning set forth in Section 15.01.
"Administrative Action" has the meaning specified within the definition
of "Tax Event" in this Section 1.01.
"Authenticating Agent" means any agent or agents of the Trustee which at
the time shall be appointed and acting pursuant to Section 6.12.
"Bankruptcy Law" means Title 11, U.S. Code, or any similar federal or
state law for the relief of debtors.
"Board of Directors" means the board of directors or the executive
committee or any other duly authorized designated officers of the Company.
PAGE 2
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company to have been duly adopted by the Board
of Directors 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 Saturday, Sunday or any other
day on which banking institutions in Wilmington, Delaware, The City of New York
or Chandler, Oklahoma are permitted or required by law or executive order to
close.
"Calculation Agent" means the Person identified as "Trustee" in the first
paragraph hereof with respect to the Debt Securities and the Institutional
Trustee with respect to the Trust Securities.
"Capital Securities" means undivided beneficial interests in the assets of
the Trust which are designated as "InCapS (SM)" and rank PARI PASSU with Common
Securities issued by the Trust; PROVIDED, HOWEVER, that if an Event of Default
(as defined in the Declaration) has occurred and is continuing, the rights of
holders of such Common Securities to payment in respect of distributions and
payments upon liquidation, redemption and otherwise are subordinated to the
rights of holders of such Capital Securities.
"Capital Securities Guarantee" means the guarantee agreement that the
Company will enter into with Wilmington Trust Company or other Persons that
operates directly or indirectly for the benefit of holders of Capital
Securities of the Trust.
"Certificate" means a certificate signed by any one of the principal
executive officer, the principal financial officer or the principal accounting
officer of the Company.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation.
"Common Securities" means undivided beneficial interests in the assets of
the Trust which are designated as "Common Securities" and rank PARI PASSU with
Capital Securities issued by the Trust; PROVIDED, HOWEVER, that if an Event of
Default (as defined in the Declaration) has occurred and is continuing, the
rights of holders of such Common Securities to payment in respect of
distributions and payments upon liquidation, redemption and otherwise are
subordinated to the rights of holders of such Capital Securities.
"Company" means Chandler (U.S.A.), Inc., an insurance holding company
incorporated in Oklahoma, and, subject to the provisions of Article XI, shall
include its successors and assigns.
"Debt Security" or "Debt Securities" has the meaning stated in
the first recital of this Indenture.
"Debt Security Register" has the meaning specified in Section 2.05.
"Declaration" means the Amended and Restated Declaration of Trust of the
Trust, dated as of December 16, 2003, as amended or supplemented from time to
time.
PAGE 3
"Default" means any event, act or condition that with notice or lapse of
time, or both, would constitute an Event of Default.
"Defaulted Interest" has the meaning set forth in Section 2.08.
"Deferred Interest" has the meaning set forth in Section 2.11.
"Event of Default" means any event specified in Section 5.01, which has
continued for the period of time, if any, and after the giving of the notice,
if any, therein designated.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Extension Period" has the meaning set forth in Section 2.11.
"Indenture" means this Indenture as originally executed or, if amended or
supplemented as herein provided, as so amended or supplemented, or both.
"Institutional Trustee" has the meaning set forth in the Declaration.
"Interest Payment Date" means January 8th, April 8th, July 8th and October
8th of each year, commencing on April 8, 2004, subject to Section 14.07.
"Interest Period" has the meaning set forth in Section 2.08.
"Interest Rate" means, with respect to any Interest Period, a per annum
rate of interest equal to LIBOR, as determined on the LIBOR Determination Date
for such Interest Period, plus 4.10%; PROVIDED, HOWEVER, that the Interest Rate
for any Interest Period prior to the Interest Period commencing on the Interest
Payment Date in January 2009 may not exceed 12.5% per annum; PROVIDED, FURTHER,
that the Interest Rate for any Interest Period may not exceed the highest rate
permitted by New York law, as the same may be modified by United States law of
general application.
"Investment Company Event" means the receipt by the Company and the Trust
of an Opinion of Counsel experienced in such matters to the effect that, as a
result of a change in law or regulation or written change in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority, there is more than an insubstantial risk that
the Trust is or, within 90 days of the date of such opinion will be, considered
an "investment company" that is required to be registered under the Investment
Company Act of 1940, as amended, which change or prospective change becomes
effective or would become effective, as the case may be, on or after the date
of the original issuance of the Debt Securities.
"LIBOR" means the London Interbank Offered Rate for three-month U.S.
Dollar deposits in Europe as determined by the Calculation Agent according to
Section 2.10(b).
"LIBOR Banking Day" has the meaning set forth in Section 2.10(b)(i).
PAGE 4
"LIBOR Business Day" has the meaning set forth in Section 2.10(b)(i).
"LIBOR Determination Date" has the meaning set forth in Section 2.10(b)(i).
"Liquidation Amount" means the liquidation amount of $1,000 per Trust
Security.
"Maturity Date" means January 8, 2034, subject to Section 14.07.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, the Vice Chairman, the President or any Vice President, and by the Chief
Financial Officer, the Treasurer, an Assistant Treasurer, the Comptroller, an
Assistant Comptroller, the Secretary or an Assistant Secretary of the Company,
and delivered to the Trustee. Each such certificate shall include the
statements provided for in Section 14.06 if and to the extent required by the
provisions of such Section.
"Opinion of Counsel" means an opinion in writing signed by legal counsel,
who may be an employee of or counsel to the Company, or who may be other
counsel reasonably satisfactory to the Trustee. Each such opinion shall
include the statements provided for in Section 14.06 if and to the extent
required by the provisions of such Section.
The term "outstanding," when used with reference to Debt Securities,
subject to the provisions of Section 7.04, means, as of any particular time,
all Debt Securities authenticated and delivered by the Trustee or the
Authenticating Agent under this Indenture, except
(a) Debt Securities theretofore canceled by the Trustee or the
Authenticating Agent or delivered to the Trustee for cancellation;
(b) Debt Securities, or portions thereof, for the payment or redemption
of which moneys in the necessary amount shall have been deposited in trust with
the Trustee or with any Paying Agent (other than the Company) or shall have
been set aside and segregated in trust by the Company (if the Company shall act
as its own Paying Agent); PROVIDED, that, if such Debt Securities, or portions
thereof, are to be redeemed prior to maturity thereof, notice of such
redemption shall have been given as provided in Articles X and XIV or provision
satisfactory to the Trustee shall have been made for giving such notice; and
(c) Debt Securities paid pursuant to Section 2.06 or in lieu of or in
substitution for which other Debt Securities shall have been authenticated and
delivered pursuant to the terms of Section 2.06 unless proof satisfactory to
the Company and the Trustee is presented that any such Debt Securities are held
by bona fide holders in due course.
"Optional Redemption Date" has the meaning set forth in Section 10.01.
"Optional Redemption Price" means an amount in cash equal to 100% of the
principal amount of the Debt Securities being redeemed plus unpaid interest
accrued on such Debt Securities to the related Optional Redemption Date.
"Paying Agent" has the meaning set forth in Section 3.04(e).
PAGE 5
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Predecessor Security" of any particular Debt Security means every
previous Debt Security evidencing all or a portion of the same debt as that
evidenced by such particular Debt Security; and, for the purposes of this
definition, any Debt Security authenticated and delivered under Section 2.06 in
lieu of a lost, destroyed or stolen Debt Security shall be deemed to evidence
the same debt as the lost, destroyed or stolen Debt Security.
"Principal Office of the Trustee" means the office of the Trustee at which
at any particular time its corporate trust business shall be principally
administered, which at all times shall be located within the United States and
at the time of the execution of this Indenture shall be Rodney Square North,
1100 North Market Street, Wilmington, DE 19890-0001.
"Resale Restriction Termination Date" means, with respect to any Debt
Security, the date which is the later of (i) two years (or such shorter period
of time as permitted by Rule 144(k) under the Securities Act) after the later
of (y) the date of original issuance of such Debt Security and (z) the last
date on which the Company or any Affiliate (as defined in Rule 405 under the
Securities Act) of the Company was the holder of such Debt Security (or any
predecessor thereto) and (ii) such later date, if any, as may be required by
any subsequent change in applicable law.
"Responsible Officer" means, with respect to the Trustee, any officer
within the Principal Office of the Trustee with direct responsibility for the
administration of the Indenture, including any vice-president, any assistant
vice-president, any secretary, any assistant secretary, the treasurer, any
assistant treasurer, any trust officer or other officer of the Principal Office
of the Trustee customarily performing functions similar to those performed by
any of the above designated officers and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of that officer's knowledge of and familiarity with the
particular subject.
"Securities Act" means the Securities Act of 1933, as amended.
"Securityholder," "holder of Debt Securities" or other similar terms,
means any Person in whose name at the time a particular Debt Security is
registered on the Debt Security Register.
"Senior Indebtedness" means, with respect to the Company, (i) the
principal, premium, if any, and interest in respect of (A) indebtedness of the
Company for money borrowed and (B) indebtedness evidenced by securities,
debentures, notes, bonds or other similar instruments issued by the Company,
(ii) all capital lease obligations of the Company, (iii) all obligations of the
Company issued or assumed as the deferred purchase price of property, all
conditional sale obligations of the Company and all obligations of the Company
under any title retention agreement (but excluding trade accounts payable
arising in the ordinary course of business), (iv) all obligations of the
Company for the reimbursement of any letter of credit, any
PAGE 6
banker's acceptance, any security purchase facility, any repurchase agreement
or similar arrangement, any interest rate swap, any other hedging arrangement,
any obligation under options or any similar credit or other transaction,
(v) all obligations of the type referred to in clauses (i) through (iv) above
of other Persons for the payment of which the Company is responsible or liable
as obligor, guarantor or otherwise and (vi) all obligations of the type
referred to in clauses (i) through (v) above of other Persons secured by any
lien on any property or asset of the Company (whether or not such obligation
is assumed by the Company), whether incurred on or prior to the date of this
Indenture or thereafter incurred, unless it is provided in the instrument
creating or evidencing the same or pursuant to which the same is outstanding
that such obligations are not superior or are pari passu in right of payment
to the Debt Securities; PROVIDED, HOWEVER, that Senior Indebtedness shall not
include (A) any debt securities issued to any trust other than the Trust (or a
trustee of such trust) that is a financing vehicle of the Company (a "financing
entity"), in connection with the issuance by such financing entity of equity or
other securities in transactions substantially similar in structure to the
transactions contemplated hereunder and in the Declaration or (B) any
guarantees of the Company in respect of the equity or other securities of any
financing entity referred to in clause (A) above.
"Special Event" means either a Tax Event or an Investment Company Event,
or both.
"Special Redemption Date" has the meaning set forth in Section 10.02.
"Special Redemption Price" means, with respect to the redemption of any
Debt Security following a Tax Event, an amount in cash equal to 104.75% of the
principal amount of Debt Securities to be redeemed prior to January 8, 2005 and
thereafter equal to the percentage for the outstanding principal amount of the
Debt Securities to be redeemed that is specified below for such Special
Redemption Date plus, in each case, unpaid interest accrued thereon to the
Special Redemption Date:
SPECIAL REDEMPTION DURING THE 12-MONTH
--------------------------------------
PERIOD BEGINNING JANUARY 8, PERCENTAGE OF PRINCIPAL AMOUNT
--------------------------- ------------------------------
2005 103.80
2006 102.85 %
2007 101.90 %
2008 100.95 %
2009 and thereafter 100.00 %
"Subsidiary" means, with respect to any Person, (i) any corporation at
least a majority of the outstanding voting stock of which is owned, directly
or indirectly, by such Person or one or more of its Subsidiaries or by such
Person and one or more of its Subsidiaries, (ii) any general partnership,
joint venture or similar entity, at least a majority of the outstanding
partnership or similar interests of which shall at the time be owned by such
Person or one or more of its Subsidiaries or by such Person and one or more
of its Subsidiaries, and (iii) any limited partnership of which such Person or
any of its Subsidiaries is a general partner. For the purposes of this
definition, "voting stock" means shares, interests, participations or other
equivalents in the equity interest (however designated) in such Person having
ordinary voting
PAGE 7
power for the election of a majority of the directors (or the equivalent) of
such Person, other than shares, interests, participations or other equivalents
having such power only by reason of the occurrence of a contingency.
"Tax Event" means the receipt by the Company and the Trust of an Opinion
of Counsel experienced in such matters to the effect that, as a result of any
amendment to or change (including any announced prospective change) in the laws
or any regulations thereunder of the United States or any political subdivision
or taxing authority thereof or therein, or as a result of any official
administrative pronouncement (including any private letter ruling, technical
advice memorandum, regulatory procedure, notice or announcement (an
"Administrative Action")) or judicial decision interpreting or applying such
laws or regulations, regardless of whether such Administrative Action or
judicial decision is issued to or in connection with a proceeding involving
the Company or the Trust and whether or not subject to review or appeal, which
amendment, clarification, change, Administrative Action or decision is enacted,
promulgated or announced, in each case on or after the date of original
issuance of the Debt Securities, there is more than an insubstantial risk that:
(i) the Trust is, or will be within 90 days of the date of such opinion,
subject to United States federal income tax with respect to income received or
accrued on the Debt Securities; (ii) if the Company is organized and existing
under the laws of the United States or any state thereof or the District of
Columbia, interest payable by the Company on the Debt Securities is not, or
within 90 days of the date of such opinion, will not be, deductible by the
Company, in whole or in part, for United States federal income tax purposes;
or (iii) the Trust is, or will be within 90 days of the date of such opinion,
subject to or otherwise required to pay, or required to withhold from
distributions to holders of Trust Securities, more than a de minimis amount of
other taxes (including withholding taxes), duties, assessments or other
governmental charges.
"Trust" means Chandler Capital Trust II, the Delaware statutory trust, or
any other similar trust created for the purpose of issuing Capital Securities
in connection with the issuance of Debt Securities under this Indenture, of
which the Company is the sponsor.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended
from time to time, or any successor legislation.
"Trust Securities" means Common Securities and Capital Securities of the
Trust.
"Trustee" means the Person identified as "Trustee" in the first paragraph
hereof, and, subject to the provisions of Article VI hereof, shall also include
its successors and assigns as Trustee hereunder.
"United States" means the United States of America and the District of
Columbia.
"U.S. Person" has the meaning given to United States Person as set forth
in Section 7701(a)(30) of the Code.
PAGE 8
ARTICLE II
DEBT SECURITIES
SECTION 2.01 AUTHENTICATION AND DATING.
-------------------------
Upon the execution and delivery of this Indenture, or from time to time
thereafter, Debt Securities in an aggregate principal amount not in excess of
$7,217,000 may be executed and delivered by the Company to the Trustee for
authentication, and the Trustee shall thereupon authenticate and make available
for delivery said Debt Securities to or upon the written order of the Company,
signed by its Chairman of the Board of Directors, Vice Chairman, President or
Chief Financial Officer or one of its Vice Presidents, without any further
action by the Company hereunder. In authenticating such Debt Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Debt Securities, the Trustee shall be entitled to receive, and (subject to
Section 6.01) shall be fully protected in relying upon a copy of any Board
Resolution or Board Resolutions relating thereto and, if applicable, an
appropriate record of any action taken pursuant to such resolution, in each
case certified by the Secretary or an Assistant Secretary or other officers
with appropriate delegated authority of the Company, as the case may be.
The Trustee shall have the right to decline to authenticate and deliver
any Debt Securities under this Section if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken or if a
Responsible Officer of the Trustee in good faith shall determine that such
action would expose the Trustee to personal liability to existing
Securityholders.
The definitive Debt Securities shall be typed, printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Debt Securities, as evidenced by
their execution of such Debt Securities.
SECTION 2.02 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
-----------------------------------------------
The Trustee's certificate of authentication on all Debt Securities shall
be in substantially the following form:
This is one of the Debt Securities referred to in the within-mentioned
Indenture.
Wilmington Trust Company,
not in its individual capacity
but solely as trustee
By:
----------------------------------
Authorized Officer
SECTION 2.03 FORM AND DENOMINATION OF DEBT SECURITIES.
----------------------------------------
The Debt Securities shall be substantially in the form of Exhibit A
hereto. The Debt Securities shall be in registered, certificated form without
coupons and in minimum denominations of $100,000 and any multiple of $1,000 in
excess thereof. The Debt Securities
PAGE 9
shall be numbered, lettered, or otherwise distinguished in such manner or in
accordance with such plans as the officers executing the same may determine
with the approval of the Trustee as evidenced by the execution and
authentication thereof.
SECTION 2.04 EXECUTION OF DEBT SECURITIES.
----------------------------
The Debt Securities shall be signed in the name and on behalf of the
Company by the manual or facsimile signature of its Chairman of the Board of
Directors, Vice Chairman, President or Chief Financial Officer or one of its
Executive Vice Presidents, Senior Vice Presidents or Vice Presidents, under
its corporate seal (if legally required) which may be affixed thereto or
printed, engraved or otherwise reproduced thereon, by facsimile or otherwise,
and which need not be attested. Only such Debt Securities as shall bear
thereon a certificate of authentication substantially in the form herein
before recited, executed by the Trustee or the Authenticating Agent by the
manual signature of an authorized officer, shall be entitled to the benefits
of this Indenture or be valid or obligatory for any purpose. Such certificate
by the Trustee or the Authenticating Agent upon any Debt Security executed by
the Company shall be conclusive evidence that the Debt Security so
authenticated has been duly authenticated and delivered hereunder and that the
holder is entitled to the benefits of this Indenture.
In case any officer of the Company who shall have signed any of the Debt
Securities shall cease to be such officer before the Debt Securities so signed
shall have been authenticated and delivered by the Trustee or the
Authenticating Agent, or disposed of by the Company, such Debt Securities
nevertheless may be authenticated and delivered or disposed of as though the
Person who signed such Debt Securities had not ceased to be such officer of
the Company; and any Debt Security may be signed on behalf of the Company by
such Persons as, at the actual date of the execution of such Debt Security,
shall be the proper officers of the Company, although at the date of the
execution of this Indenture any such person was not such an officer.
Every Debt Security shall be dated the date of its authentication.
SECTION 2.05 EXCHANGE AND REGISTRATION OF TRANSFER OF DEBT SECURITIES.
--------------------------------------------------------
The Company shall cause to be kept, at the office or agency maintained for
the purpose of registration of transfer and for exchange as provided in Section
3.02, a register (the "Debt Security Register") for the Debt Securities issued
hereunder in which, subject to such reasonable regulations as it may prescribe,
the Company shall provide for the registration and transfer of all Debt
Securities as provided in this Article II. Such register shall be in written
form or in any other form capable of being converted into written form within
a reasonable time.
Debt Securities to be exchanged may be surrendered at the Principal Office
of the Trustee or at any office or agency to be maintained by the Company for
such purpose as provided in Section 3.02, and the Company shall execute, the
Company or the Trustee shall register and the Trustee or the Authenticating
Agent shall authenticate and make available for delivery in exchange therefor,
the Debt Security or Debt Securities which the Securityholder making the
exchange shall be entitled to receive. Upon due presentment for registration
of transfer of any Debt Security at the Principal Office of the Trustee or at
any office or agency of
PAGE 10
the Company maintained for such purpose as provided in Section 3.02, the
Company shall execute, the Company or the Trustee shall register and the
Trustee or the Authenticating Agent shall authenticate and make available for
delivery in the name of the transferee or transferees, a new Debt Security for
a like aggregate principal amount. Registration or registration of transfer of
any Debt Security by the Trustee or by any agent of the Company appointed
pursuant to Section 3.02, and delivery of such Debt Security, shall be deemed
to complete the registration or registration of transfer of such Debt Security.
All Debt Securities presented for registration of transfer or for exchange
or payment shall (if so required by the Company or the Trustee or the
Authenticating Agent) be duly endorsed by, or be accompanied by, a written
instrument or instruments of transfer in form satisfactory to the Company and
either the Trustee or the Authenticating Agent duly executed by, the holder or
such holder's attorney duly authorized in writing.
No service charge shall be made for any exchange or registration of
transfer of Debt Securities, but the Company or the Trustee may require payment
of a sum sufficient to cover any tax, fee or other governmental charge that may
be imposed in connection therewith other than exchanges pursuant to Section
2.07, Section 9.04 or Section 10.04 not involving any transfer.
The Company or the Trustee shall not be required to exchange or register a
transfer of any Debt Security for a period of 15 days immediately preceding the
date of selection of Debt Securities for redemption.
Notwithstanding the foregoing, Debt Securities may not be transferred
prior to the Resale Restriction Termination Date except in compliance with the
legend set forth below, unless otherwise determined by the Company in
accordance with applicable law, which legend shall be placed on each Debt
Security:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY OR ANY
INTEREST OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF, AS THE
CASE MAY BE, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY OR ANY
INTEREST OR PARTICIPATION HEREIN PRIOR TO THE DATE WHICH IS THE LATER OF (i)
TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER
THE SECURITIES ACT) AFTER THE LATER OF (Y) THE DATE OF ORIGINAL ISSUANCE HEREOF
AND (Z) THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE (AS DEFINED IN RULE
405 UNDER THE SECURITIES ACT) OF THE COMPANY WAS THE HOLDER OF THIS SECURITY OR
SUCH INTEREST OR PARTICIPATION (OR ANY PREDECESSOR
PAGE 11
THERETO) AND (ii) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY ANY SUBSEQUENT
CHANGE IN APPLICABLE LAW, ONLY (A) TO THE COMPANY, (B) PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON THE HOLDER REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER", AS DEFINED IN RULE 144A, THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (C) PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (a) (1), (2), (3), (7) OR (8) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THIS SECURITY OR SUCH INTEREST OR PARTICIPATION FOR ITS
OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN ACCREDITED INVESTOR, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, (D) PURSUANT TO OFFERS AND
SALES TO NON-US PERSONS THAT OCCUR OUTSIDE THE UNITED STATES PURSUANT TO
REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE COMPANY'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (C) OR (E) ABOVE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO IT IN ACCORDANCE WITH
THE INDENTURE, A COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY. THE HOLDER
OF THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE
HEREOF OR THEREOF, AS THE CASE MAY BE, AGREES THAT IT WILL COMPLY WITH THE
FOREGOING RESTRICTIONS.
THE HOLDER OF THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, BY
ITS ACCEPTANCE HEREOF OR THEREOF, AS THE CASE MAY BE, ALSO AGREES, REPRESENTS
AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT
OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") (EACH A "PLAN"), OR AN
ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY PLAN'S
INVESTMENT IN THE ENTITY AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN MAY
ACQUIRE OR HOLD THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, UNLESS
SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER
U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60,
91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND
HOLDING OF THIS SECURITY OR SUCH INTEREST OR PARTICIPATION IS NOT PROHIBITED
BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH
PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS SECURITY OR ANY INTEREST
OR PARTICIPATION HEREIN WILL BE DEEMED
PAGE 12
TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING HEREOF OR THEREOF, AS THE CASE
MAY BE, THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING
OF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS
APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE
BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE AND
HOLDING WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA
OR SECTION 4975 OF THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR
ADMINISTRATIVE EXEMPTION.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER OF THIS SECURITY WILL DELIVER
TO THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS
MAY BE REQUIRED BY THE INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.
THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM
DENOMINATIONS OF $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY
ATTEMPTED TRANSFER OF THIS SECURITY IN DENOMINATIONS OF LESS THAN $100,000
SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH
PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SECURITY OR
ANY INTEREST OR PARTICIPATION HEREIN FOR ANY PURPOSE, INCLUDING, BUT NOT
LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS SECURITY OR SUCH INTEREST OR
PARTICIPATION, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO
INTEREST WHATSOEVER IN THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN.
SECTION 2.06 MUTILATED, DESTROYED, LOST OR STOLEN DEBT SECURITIES.
----------------------------------------------------
In case any Debt Security shall become mutilated or be destroyed, lost or
stolen, the Company shall execute, and upon its written request the Trustee
shall authenticate and deliver, a new Debt Security bearing a number not
contemporaneously outstanding, in exchange and substitution for the mutilated
Debt Security, or in lieu of and in substitution for the Debt Security so
destroyed, lost or stolen. In every case the applicant for a substituted Debt
Security shall furnish to the Company and the Trustee such security or
indemnity as may be required by them to save each of them harmless, and, in
every case of destruction, loss or theft, the applicant shall also furnish to
the Company and the Trustee evidence to their satisfaction of the destruction,
loss or theft of such Debt Security and of the ownership thereof.
The Trustee may authenticate any such substituted Debt Security and
deliver the same upon the written request or authorization of any officer of
the Company. Upon the issuance of any substituted Debt Security, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses connected therewith. In case any Debt Security which has matured or
is
PAGE 13
about to mature or has been called for redemption in full shall become
mutilated or be destroyed, lost or stolen, the Company may, instead of issuing
a substitute Debt Security, pay or authorize the payment of the same (without
surrender thereof except in the case of a mutilated Debt Security) if the
applicant for such payment shall furnish to the Company and the Trustee such
security or indemnity as may be required by them to save each of them harmless
and, in case of destruction, loss or theft, evidence satisfactory to the
Company and to the Trustee of the destruction, loss or theft of such Security
and of the ownership thereof.
Every substituted Debt Security issued pursuant to the provisions of this
Section 2.06 by virtue of the fact that any such Debt Security is destroyed,
lost or stolen shall constitute an additional contractual obligation of the
Company, whether or not the destroyed, lost or stolen Debt Security shall be
found at any time, and shall be entitled to all the benefits of this Indenture
equally and proportionately with any and all other Debt Securities duly issued
hereunder. All Debt Securities shall be held and owned upon the express
condition that, to the extent permitted by applicable law, the foregoing
provisions are exclusive with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Debt Securities and shall preclude any and
all other rights or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement or payment of
negotiable instruments or other securities without their surrender.
SECTION 2.07 TEMPORARY DEBT SECURITIES.
-------------------------
Pending the preparation of definitive Debt Securities, the Company may
execute and the Trustee shall authenticate and make available for delivery
temporary Debt Securities that are typed, printed or lithographed. Temporary
Debt Securities shall be issuable in any authorized denomination, and
substantially in the form of the definitive Debt Securities but with such
omissions, insertions and variations as may be appropriate for temporary Debt
Securities, all as may be determined by the Company. Every such temporary Debt
Security shall be executed by the Company and be authenticated by the Trustee
upon the same conditions and in substantially the same manner, and with the
same effect, as the definitive Debt Securities. Without unreasonable delay,
the Company will execute and deliver to the Trustee or the Authenticating Agent
definitive Debt Securities and thereupon any or all temporary Debt Securities
may be surrendered in exchange therefor, at the Principal Office of the Trustee
or at any office or agency maintained by the Company for such purpose as
provided in Section 3.02, and the Trustee or the Authenticating Agent shall
authenticate and make available for delivery in exchange for such temporary
Debt Securities a like aggregate principal amount of such definitive Debt
Securities. Such exchange shall be made by the Company at its own expense and
without any charge therefor except that in case of any such exchange involving
a registration of transfer the Company may require payment of a sum sufficient
to cover any tax, fee or other governmental charge that may be imposed in
relation thereto. Until so exchanged, the temporary Debt Securities shall in
all respects be entitled to the same benefits under this Indenture as
definitive Debt Securities authenticated and delivered hereunder.
SECTION 2.08 PAYMENT OF INTEREST.
-------------------
Each Debt Security will bear interest at the then applicable Interest
Rate (i) in the case of the initial Interest Period, for the period from, and
including, the date of original issuance
PAGE 14
of such Debt Security to, but excluding, the initial Interest Payment Date and
(ii) thereafter, for the period from, and including, the first day following
the end of the preceding Interest Period to, but excluding, the applicable
Interest Payment Date or, in the case of the last Interest Period, the related
Optional Redemption Date, Special Redemption Date or Maturity Date, as
applicable (each such period, an "Interest Period"), on the principal thereof,
on any overdue principal and (to the extent that payment of such interest is
enforceable under applicable law) on Deferred Interest and on any overdue
installment of interest (including Defaulted Interest), payable (subject to
the provisions of Article XII) on each Interest Payment Date. Interest and
any Deferred Interest on any Debt Security that is payable, and is punctually
paid or duly provided for by the Company, on any Interest Payment Date shall be
paid to the Person in whose name such Debt Security (or one or more Predecessor
Securities) is registered at the close of business on the regular record date
for such interest installment, except that interest and any Deferred Interest
payable on the Maturity Date, any Optional Redemption Date or the Special
Redemption Date, as the case may be, shall be paid to the Person to whom
principal is paid. In case (i) the Maturity Date of any Debt Security or (ii)
any Debt Security or portion thereof is called for redemption and the related
Optional Redemption Date or the Special Redemption Date, as the case may be,
is subsequent to the regular record date with respect to any Interest Payment
Date and either on or prior to such Interest Payment Date, interest on such
Debt Security will be paid upon presentation and surrender of such Debt
Security.
Any interest on any Debt Security, other than Deferred Interest, that is
payable, but is not punctually paid or duly provided for by the Company, on
any Interest Payment Date (herein called "Defaulted Interest") shall forthwith
cease to be payable to the holder on the relevant regular record date by virtue
of having been such holder, and such Defaulted Interest shall be paid by the
Company to the Persons in whose names such Debt Securities (or their respective
Predecessor Securities) are registered at the close of business on a special
record date for the payment of such Defaulted Interest, which shall be fixed in
the following manner: the Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each such Debt Security and
the date of the proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements reasonably satisfactory to the Trustee for such deposit prior to
the date of the proposed payment, such money when deposited to be held in trust
for the benefit of the Persons entitled to such Defaulted Interest as provided
in this paragraph. Thereupon the Trustee shall fix a special record date for
the payment of such Defaulted Interest, which shall not be more than fifteen
nor less than ten days prior to the date of the proposed payment and not less
than ten days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of such special record
date and, in the name and at the expense of the Company, shall cause notice of
the proposed payment of such Defaulted Interest and the special record date
therefor to be mailed, first class postage prepaid, to each Securityholder at
his or her address as it appears in the Debt Security Register, not less than
ten days prior to such special record date. Notice of the proposed payment of
such Defaulted Interest and the special record date therefor having been mailed
as aforesaid, such Defaulted Interest shall be paid to the Persons in whose
names such Debt Securities (or their respective Predecessor Securities) are
registered on such special record date and thereafter the Company shall have
no further payment obligation in respect of the Defaulted Interest.
PAGE 15
Any interest scheduled to become payable on an Interest Payment Date
occurring during an Extension Period shall not be Defaulted Interest and shall
be payable on such other date as may be specified in the terms of such Debt
Securities.
The term "regular record date", as used in this Section, shall mean the
fifteenth day prior to the applicable Interest Payment Date, whether or not
such day is a Business Day.
Subject to the foregoing provisions of this Section, each Debt Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Debt Security shall carry the rights to interest
accrued and unpaid, and to accrue, that were carried by such other Debt
Security.
SECTION 2.09 CANCELLATION OF DEBT SECURITIES PAID, ETC.
-----------------------------------------
All Debt Securities surrendered for the purpose of payment, redemption,
exchange or registration of transfer, shall, if surrendered to the Company or
any Paying Agent, be surrendered to the Trustee and promptly canceled by it,
or, if surrendered to the Trustee or any Authenticating Agent, shall be
promptly canceled by it, and no Debt Securities shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this Indenture. All
Debt Securities canceled by any Authenticating Agent shall be delivered to the
Trustee. The Trustee shall destroy all canceled Debt Securities unless the
Company otherwise directs the Trustee in writing, in which case the Trustee
shall dispose of such Debt Securities as directed by the Company. If the
Company shall acquire any of the Debt Securities, however, such acquisition
shall not operate as a redemption or satisfaction of the indebtedness
represented by such Debt Securities unless and until the same are surrendered
to the Trustee for cancellation.
SECTION 2.10 COMPUTATION OF INTEREST.
-----------------------
(a) The amount of interest payable for any Interest Period will be
computed on the basis of a 360-day year and the actual number of days elapsed
in such Interest Period.
(b) LIBOR shall be determined by the Calculation Agent for each Interest
Period in accordance with the following provisions:
PAGE 16
(i) On the second LIBOR Business Day (provided, that on such day
commercial banks are open for business (including dealings in foreign
currency deposits) in London (a "LIBOR Banking Day"), and otherwise the next
preceding LIBOR Business Day that is also a LIBOR Banking Day) prior to the
January 15th, April 15th, July 15th or October 15th, as the case may be,
immediately succeeding the commencement of such Interest Period (or, in the
case of the first Interest Period, prior to December 16, 2003) (each such
day, a "LIBOR Determination Date"), LIBOR shall equal the rate, as obtained
by the Calculation Agent, for three-month U.S. Dollar deposits in Europe,
which appears on Telerate (as defined in the International Swaps and
Derivatives Association, Inc. 2000 Interest Rate and Currency Exchange
Definitions) page 3750 or such other page as may replace such page 3750, as
of 11:00 a.m. (London time) on such LIBOR Determination Date, as reported by
Bloomberg Financial Markets Commodities News or any successor service
("Telerate Page 3750"). "LIBOR Business Day" means any day that is not a
Saturday, Sunday or other day on which commercial banking institutions in
The City of New York or Wilmington, Delaware are authorized or obligated by
law or executive order to be closed. If such rate is superseded on Telerate
Page 3750 by a corrected rate before 12:00 noon (London time) on such LIBOR
Determination Date, the corrected rate as so substituted will be LIBOR for
such LIBOR Determination Date.
(ii) If, on such LIBOR Determination Date, such rate does not
appear on Telerate Page 3750, the Calculation Agent shall determine the
arithmetic mean of the offered quotations of the Reference Banks to leading
banks in the London interbank market for three-month U.S. Dollar deposits in
Europe (in an amount determined by the Calculation Agent) by reference to
requests for quotations as of approximately 11:00 a.m. (London time) on such
LIBOR Determination Date made by the Calculation Agent to the Reference
Banks. If, on such LIBOR Determination Date, at least two of the Reference
Banks provide such quotations, LIBOR shall equal the arithmetic mean of such
quotations. If, on such LIBOR Determination Date, only one or none of the
Reference Banks provide such a quotation, LIBOR shall be deemed to be the
arithmetic mean of the offered quotations that at least two leading banks in
The City of New York (as selected by the Calculation Agent) are quoting on
such LIBOR Determination Date for three-month U.S. Dollar deposits in Europe
at approximately 11:00 a.m. (London time) (in an amount determined by the
Calculation Agent). As used herein, "Reference Banks" means four major banks
in the London interbank market selected by the Calculation Agent.
(iii) If the Calculation Agent is required but is unable to
determine a rate in accordance with at least one of the procedures provided
above, LIBOR for such Interest Period shall be LIBOR in effect for the
immediately preceding Interest Period.
(c) All percentages resulting from any calculations on the Debt
Securities will be rounded, if necessary, to the nearest one hundred-thousandth
of a percentage point, with five one-millionths of a percentage point rounded
upward (e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)),
and all dollar amounts used in or resulting from such calculation will be
rounded to the nearest cent (with one-half cent being rounded upward).
PAGE 17
(d) On each LIBOR Determination Date, the Calculation Agent shall notify,
in writing, the Company and the Paying Agent of the applicable Interest Rate
that applies to the related Interest Period. The Calculation Agent shall, upon
the request of a holder of any Debt Securities, inform such holder of the
Interest Rate that applies to the related Interest Period. All calculations
made by the Calculation Agent in the absence of manifest error shall be
conclusive for all purposes and binding on the Company and the holders of the
Debt Securities. The Paying Agent shall be entitled to rely on information
received from the Calculation Agent or the Company as to the applicable
Interest Rate. The Company shall, from time to time, provide any necessary
information to the Paying Agent relating to any original issue discount and
interest on the Debt Securities that is included in any payment and reportable
for taxable income calculation purposes.
SECTION 2.11 EXTENSION OF INTEREST PAYMENT PERIOD.
------------------------------------
So long as no Event of Default has occurred and is continuing, the Company
shall have the right, from time to time and without causing an Event of Default,
to defer payments of interest on the Debt Securities by extending the interest
payment period on the Debt Securities at any time and from time to time during
the term of the Debt Securities, for up to 20 consecutive quarterly periods
(each such extended interest payment period, together with all previous and
further consecutive extensions thereof, is referred to herein as an "Extension
Period"). No Extension Period may end on a date other than an Interest Payment
Date or extend beyond the Maturity Date, any Optional Redemption Date or the
Special Redemption Date, as the case may be. During any Extension Period,
interest will continue to accrue on the Debt Securities, and interest on such
accrued interest (such accrued interest and interest thereon referred to herein
as "Deferred Interest") will accrue at an annual rate equal to the Interest
Rate applicable during such Extension Period, compounded quarterly from the
date such Deferred Interest would have been payable were it not for the
Extension Period, to the extent permitted by applicable law. No interest or
Deferred Interest (except any Additional Interest that may be due and payable)
shall be due and payable during an Extension Period, except at the end thereof.
At the end of any Extension Period, the Company shall pay all Deferred Interest
then accrued and unpaid on the Debt Securities; PROVIDED, HOWEVER, that during
any Extension Period, the Company shall be subject to the restrictions set
forth in Section 3.08. Prior to the termination of any Extension Period, the
Company may further extend such Extension Period, PROVIDED, that no Extension
Period (including all previous and further consecutive extensions that are part
of such Extension Period) shall exceed 20 consecutive quarterly periods. Upon
the termination of any Extension Period and upon the payment of all Deferred
Interest, the Company may commence a new Extension Period, subject to the
foregoing requirements. The Company must give the Trustee notice of its
election to begin or extend an Extension Period at least one Business Day prior
to the regular record date applicable to the next Interest Payment Date. The
Trustee shall give notice of the Company's election to begin or extend an
Extension Period to the Securityholders.
SECTION 2.12 CUSIP NUMBERS.
-------------
The Company in issuing the Debt Securities may use a "CUSIP" number (if
then generally in use), and, if so, the Trustee shall use a "CUSIP" number in
notices of redemption as a convenience to Securityholders; PROVIDED, that any
such notice may state that no representation is made as to the correctness of
such number either as printed on the Debt Securities or as
PAGE 18
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Debt Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Company will promptly notify the Trustee in writing of any change in the
CUSIP number.
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01 PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST; AGREED TREATMENT
------------------------------------------------------------
OF THE DEBT SECURITIES.
- ----------------------
(a) The Company covenants and agrees that it will duly and punctually pay
or cause to be paid all payments due in respect of the Debt Securities at the
place, at the respective times and in the manner provided in this Indenture and
the Debt Securities. Payment of the principal of and premium, if any, and
interest on the Debt Securities due on the Maturity Date, any Optional
Redemption Date or the Special Redemption Date, as the case may be, will be
made by the Company in immediately available funds against presentation and
surrender of such Debt Securities. At the option of the Company, each
installment of interest on the Debt Securities due on an Interest Payment Date
other than the Maturity Date, any Optional Redemption Date or the Special
Redemption Date, as the case may be, may be paid (i) by mailing checks for
such interest payable to the order of the holders of Debt Securities entitled
thereto as they appear on the Debt Security Register or (ii) by wire transfer
of immediately available funds to any account with a banking institution
located in the United States designated by such holders to the Paying Agent no
later than the related record date. Notwithstanding anything to the contrary
contained in this Indenture or any Debt Security, if the Trust or the trustee
of the Trust is the holder of any Debt Security, then all payments in respect
of such Debt Security shall be made by the Company in immediately available
funds when due.
(b) The Company will treat the Debt Securities as indebtedness, and the
interest payable in respect of such Debt Securities as interest, for all U.S.
federal income tax purposes. All payments in respect of such Debt Securities
will be made free and clear of U.S. withholding tax to any beneficial owner
thereof that has provided an Internal Revenue Service Form W-8 BEN (or any
substitute or successor form) establishing its non-U.S. status for U.S. federal
income tax purposes.
(c) As of the date of this Indenture, the Company represents that it has
no intention to exercise its right under Section 2.11 to defer payments of
interest on the Debt Securities by commencing an Extension Period.
(d) As of the date of this Indenture, the Company represents that the
likelihood that it would exercise its right under Section 2.11 to defer
payments of interest on the Debt Securities by commencing an Extension Period
at any time during which the Debt Securities are outstanding is remote because
of the restrictions that would be imposed on the Company's ability to declare
or pay dividends or distributions on, or to redeem, purchase or make a
liquidation payment with respect to, any of its outstanding equity and on the
Company's ability to make any payments of principal of or premium, if any, or
interest on, or repurchase or
PAGE 19
redeem, any of its debt securities that rank in all respects PARI PASSU with or
junior in interest to the Debt Securities.
SECTION 3.02 OFFICES FOR NOTICES AND PAYMENTS, ETC.
-------------------------------------
So long as any of the Debt Securities remain outstanding, the Company will
maintain in Wilmington, Delaware or in Chandler, Oklahoma an office or agency
where the Debt Securities may be presented for payment, an office or agency
where the Debt Securities may be presented for registration of transfer and for
exchange as provided in this Indenture and an office or agency where notices
and demands to or upon the Company in respect of the Debt Securities or of this
Indenture may be served. The Company will give to the Trustee written notice
of the location of any such office or agency and of any change of location
thereof. Until otherwise designated from time to time by the Company in a
notice to the Trustee, or specified as contemplated by Section 2.05, such
office or agency for all of the above purposes shall be the Principal Office of
the Trustee. In case the Company shall fail to maintain any such office or
agency in Wilmington, Delaware or in Chandler, Oklahoma, or shall fail to give
such notice of the location or of any change in the location thereof,
presentations and demands may be made and notices may be served at the
Principal Office of the Trustee.
In addition to any such office or agency, the Company may from time to
time designate one or more offices or agencies outside Wilmington, Delaware or
Chandler, Oklahoma where the Debt Securities may be presented for registration
of transfer and for exchange in the manner provided in this Indenture, and the
Company may from time to time rescind such designation, as the Company may deem
desirable or expedient; PROVIDED, HOWEVER, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain any such office or agency in Wilmington, Delaware or in Chandler,
Oklahoma for the purposes above mentioned. The Company will give to the
Trustee prompt written notice of any such designation or rescission thereof.
SECTION 3.03 APPOINTMENTS TO FILL VACANCIES IN TRUSTEE'S OFFICE.
--------------------------------------------------
The Company, whenever necessary to avoid or fill a vacancy in the office
of Trustee, will appoint, in the manner provided in Section 6.09, a Trustee, so
that there shall at all times be a Trustee hereunder.
SECTION 3.04 PROVISION AS TO PAYING AGENT.
----------------------------
(a) If the Company shall appoint a Paying Agent other than the Trustee,
it will cause such Paying Agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee, subject to the
provision of this Section 3.04,
(i) that it will hold all sums held by it as such agent for the
payment of all payments due in respect of the Debt Securities (whether such
sums have been paid to it by the Company or by any other obligor on the Debt
Securities) in trust for the benefit of the holders of the Debt Securities;
PAGE 20
(ii) that it will give the Trustee prompt written notice of any
failure by the Company (or by any other obligor on the Debt Securities) to make
any payment in respect of the Debt Securities when the same shall be due and
payable; and
(iii) that it will, at any time during the continuance of any Event
of Default, upon the written request of the Trustee, forthwith pay to the
Trustee all sums so held in trust by such Paying Agent.
(b) If the Company shall act as its own Paying Agent, it will, on or
before each due date of the payments due in respect of the Debt Securities, set
aside, segregate and hold in trust for the benefit of the holders of the Debt
Securities a sum sufficient to make such payments so becoming due and will
notify the Trustee in writing of any failure to take such action and of any
failure by the Company (or by any other obligor under the Debt Securities) to
make any payment in respect of the Debt Securities when the same shall become
due and payable.
Whenever the Company shall have one or more Paying Agents for the Debt
Securities, it will, on or prior to each due date of the payments in respect of
the Debt Securities, deposit with a Paying Agent a sum sufficient to pay all
payments so becoming due, such sum to be held in trust for the benefit of the
Persons entitled thereto and (unless such Paying Agent is the Trustee) the
Company shall promptly notify the Trustee in writing of its action or failure
to act.
(c) Anything in this Section 3.04 to the contrary notwithstanding, the
Company may, at any time, for the purpose of obtaining a satisfaction and
discharge with respect to the Debt Securities, or for any other reason, pay,
or direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or any such Paying Agent, such sums to be held by the Trustee upon
the same terms and conditions herein contained.
(d) Anything in this Section 3.04 to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section 3.04 is subject to
Sections 12.03 and 12.04.
(e) The Company hereby initially appoints the Trustee to act as paying
agent for the Debt Securities (the "Paying Agent").
SECTION 3.05 CERTIFICATE TO TRUSTEE.
----------------------
The Company will deliver to the Trustee on or before 120 days after the
end of each fiscal year, so long as Debt Securities are outstanding hereunder,
a Certificate stating that in the course of the performance by the signers of
their duties as officers of the Company they would normally have knowledge of
any default by the Company in the performance of any covenants of the Company
contained herein, stating whether or not they have knowledge of any such
default and, if so, specifying each such default of which the signers have
knowledge and the nature thereof.
PAGE 21
SECTION 3.06 ADDITIONAL INTEREST.
-------------------
If and for so long as the Trust is the holder of all Debt Securities and
is subject to or otherwise required to pay (or is required to withhold from
distributions to holders of Trust Securities) any additional taxes (including
withholding taxes), duties, assessments or other governmental charges as a
result of a Tax Event, the Company will pay such additional amounts (the
"Additional Interest") on the Debt Securities or the Trust Securities, as the
case may be, as shall be required so that the net amounts received and retained
by the holders of Debt Securities or Trust Securities, as the case may be,
after payment of all taxes (including withholding taxes), duties, assessments
or other governmental charges, will be equal to the amounts that such holders
would have received and retained had no such taxes (including withholding
taxes), duties, assessments or other governmental charges been imposed.
Whenever in this Indenture or the Debt Securities there is a reference in
any context to the payment of principal of or premium, if any, or interest on
the Debt Securities, such mention shall be deemed to include mention of
payments of the Additional Interest provided for in this Section to the extent
that, in such context, Additional Interest is, was or would be payable in
respect thereof pursuant to the provisions of this Section and express mention
of the payment of Additional Interest (if applicable) in any provisions hereof
shall not be construed as excluding Additional Interest in those provisions
hereof where such express mention is not made, PROVIDED, HOWEVER, that,
notwithstanding anything to the contrary contained in this Indenture or any
Debt Security, the deferral of the payment of interest during an Extension
Period pursuant to Section 2.11 shall not defer the payment of any Additional
Interest that may be due and payable.
SECTION 3.07 COMPLIANCE WITH CONSOLIDATION PROVISIONS.
----------------------------------------
The Company will not, while any of the Debt Securities remain outstanding,
consolidate with, or merge into, any other Person, or merge into itself, or
sell, convey, transfer or otherwise dispose of all or substantially all of its
property and assets to any other Person unless the provisions of Article XI
hereof are complied with.
SECTION 3.08 LIMITATION ON DIVIDENDS.
-----------------------
If (i) there shall have occurred and be continuing an Event of Default,
(ii) the Company shall be in default with respect to its payment of any
obligations under the Capital Securities Guarantee or (iii) the Company shall
have given notice of its election to defer payments of interest on the Debt
Securities by extending the interest payment period as provided herein and such
period, or any extension thereof, shall have commenced and be continuing, then
the Company may not (A) declare or pay any dividends or distributions on, or
redeem, purchase, acquire, or make a liquidation payment with respect to, any
of the Company's capital stock, (B) make any payment of principal of or
premium, if any, or interest on or repay, repurchase or redeem any debt
securities of the Company that rank in all respects PARI PASSU with or junior
in interest to the Debt Securities or (C) make any payment under any guarantees
of the Company that rank in all respects PARI PASSU with or junior in interest
to the Capital Securities Guarantee (other than (a) repurchases, redemptions or
other acquisitions of shares of capital stock of the Company (I) in connection
with any employment contract, benefit plan or other similar arrangement with or
for the benefit of one or more employees, officers, directors or consultants,
PAGE 22
(II) in connection with a dividend reinvestment or stockholder stock purchase
plan or (III) in connection with the issuance of capital stock of the Company
(or securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the
occurrence of (i), (ii) or (iii) above, (b) as a result of any exchange or
conversion of any class or series of the Company's capital stock (or any
capital stock of a subsidiary of the Company) for any class or series of the
Company's capital stock or of any class or series of the Company's indebtedness
for any class or series of the Company's capital stock, (c) the purchase of
fractional interests in shares of the Company's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged, (d) any declaration of a dividend in connection with
any stockholder's rights plan, or the issuance of rights, stock or other
property under any stockholder's rights plan, or the redemption or repurchase
of rights pursuant thereto or (e) any dividend in the form of stock, warrants,
options or other rights where the dividend stock or the stock issuable upon
exercise of such warrants, options or other rights is the same stock as that on
which the dividend is being paid or ranks PARI PASSU with or junior in interest
to such stock).
SECTION 3.09 COVENANTS AS TO THE TRUST.
-------------------------
For so long as such Trust Securities remain outstanding, the Company shall
maintain 100% ownership of the Common Securities; PROVIDED, HOWEVER, that any
permitted successor of the Company under this Indenture may succeed to the
Company's ownership of such Common Securities. The Company, as owner of the
Common Securities, shall use commercially reasonable efforts to cause the Trust
(a) to remain a statutory trust, except in connection with a distribution of
Debt Securities to the holders of Trust Securities in liquidation of the Trust,
the redemption of all of the Trust Securities or mergers, consolidations or
amalgamations, each as permitted by the Declaration, (b) to otherwise continue
to be classified as a grantor trust for United States federal income tax
purposes and (c) to cause each holder of Trust Securities to be treated as
owning an undivided beneficial interest in the Debt Securities.
ARTICLE IV
LISTS
SECTION 4.01 SECURITYHOLDERS' LISTS.
----------------------
The Company covenants and agrees that it will furnish or cause to be
furnished to the Trustee:
(a) on each regular record date for an Interest Payment Date, a list, in
such form as the Trustee may reasonably require, of the names and addresses of
the Securityholders of the Debt Securities as of such record date; and
(b) at such other times as the Trustee may request in writing, within 30
days after the receipt by the Company of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such
list is furnished; except that no such lists need be furnished under this
Section 4.01 so long as the Trustee is in possession thereof by reason of its
acting as Debt Security registrar.
PAGE 23
SECTION 4.02 PRESERVATION AND DISCLOSURE OF LISTS.
------------------------------------
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the holders of
Debt Securities (1) contained in the most recent list furnished to it as
provided in Section 4.01 or (2) received by it in the capacity of Debt
Securities registrar (if so acting) hereunder. The Trustee may destroy any
list furnished to it as provided in Section 4.01 upon receipt of a new list so
furnished.
(b) In case three or more holders of Debt Securities (hereinafter
referred to as "applicants") apply in writing to the Trustee and furnish to
the Trustee reasonable proof that each such applicant has owned a Debt Security
for a period of at least six months preceding the date of such application, and
such application states that the applicants desire to communicate with other
holders of Debt Securities with respect to their rights under this Indenture or
under such Debt Securities and is accompanied by a copy of the form of proxy or
other communication which such applicants propose to transmit, then the Trustee
shall within five Business Days after the receipt of such application, at its
election, either:
(i) afford such applicants access to the information preserved at
the time by the Trustee in accordance with the provisions of subsection
(a) of this Section 4.02, or
(ii) inform such applicants as to the approximate number of holders
of Debt Securities whose names and addresses appear in the information
preserved at the time by the Trustee in accordance with the provisions of
subsection (a) of this Section 4.02, and as to the approximate cost of mailing
to such Securityholders the form of proxy or other communication, if any,
specified in such application.
If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon the written request of such applicants,
mail to each Securityholder of Debt Securities whose name and address appear
in the information preserved at the time by the Trustee in accordance with the
provisions of subsection (a) of this Section 4.02 a copy of the form of proxy
or other communication which is specified in such request with reasonable
promptness after a tender to the Trustee of the material to be mailed and of
payment, or provision for the payment, of the reasonable expenses of mailing,
unless within five days after such tender, the Trustee shall mail to such
applicants and file with the Securities and Exchange Commission, if permitted
or required by applicable law, together with a copy of the material to be
mailed, a written statement to the effect that, in the opinion of the Trustee,
such mailing would be contrary to the best interests of the holders of all Debt
Securities, as the case may be, or would be in violation of applicable law.
Such written statement shall specify the basis of such opinion. If said
Commission, as permitted or required by applicable law, after opportunity for
a hearing upon the objections specified in the written statement so filed,
shall enter an order refusing to sustain any of such objections or if, after
the entry of an order sustaining one or more of such objections, said
Commission shall find, after notice and opportunity for hearing, that all the
objections so sustained have been met and shall enter an order so declaring,
the Trustee shall mail copies of such material to all such Securityholders with
reasonable promptness after the entry of such order and the renewal of such
tender; otherwise the Trustee shall be relieved of any obligation or duty to
such applicants respecting their application.
PAGE 24
(c) Each and every holder of Debt Securities, by receiving and holding
the same, agrees with the Company and the Trustee that none of the Company, the
Trustee or any Paying Agent shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the holders
of Debt Securities in accordance with the provisions of subsection (b) of this
Section 4.02, regardless of the source from which such information was derived,
and that the Trustee shall not be held accountable by reason of mailing any
material pursuant to a request made under said subsection (b).
SECTION 4.03 FINANCIAL AND OTHER INFORMATION.
-------------------------------
(a) The Company shall deliver, by hard copy or electronic transmission,
to each holder of Debt Securities: (1) within 45 days after the end of each
quarterly fiscal period other than year end, (i) unaudited consolidated
financial statements of the Company (including balance sheet and income
statement) covering such period and (ii) an Officer's Certificate of the
Company to the effect specified in Exhibit B hereto; (2) within 60 days after
year end, (i) unaudited consolidated financial statements of the Company
(include balance sheet and income statement) covering the related annual
period and (ii) an Officer's Certificate of the Company to the effect
specified in Exhibit B hereto; (3) within the earlier of (y) 90 days after the
end of each fiscal year and (z) such earlier number of days prescribed by the
Securities and Exchange Commission for the filing with it of a Form 10-K by
companies subject to the informational reporting requirements of the Exchange
Act, (i) audited consolidated financial statements of the Company (including
balance sheet and income statement) covering such fiscal year, (ii) the report
of the independent accountants with respect to such financial statements and
(iii) an Officer's Certificate of the Company detailing any material
differences between the unaudited financial statements for such fiscal year
delivered pursuant to clause (2)(i) above and those delivered pursuant to this
clause; (4) within 7 days after the filing thereof, each Form 10-K and Form
10-Q that is prepared and filed by the Company with the Securities and Exchange
Commission in accordance with the Exchange Act, if any; (5) if the Company is
not then (y) subject to Section 13 or 15(d) of the Exchange Act or (z) exempt
from reporting pursuant to Rule 12g3-2(b) thereunder, the information required
to be provided by Rule 144A(d)(4) under the Securities Act unless all of such
information has been previously delivered to holders of the Debt Securities
under clause (1), (2) or (3) above; and (6) within 30 days after the end of the
fiscal year of the Company, Form 1099 or such other annual U.S. federal income
tax information statement required by the Code containing such information with
regard to the Debt Securities held by such holder as is required by the Code
and the income tax regulations of the U.S. Treasury thereunder.
(b) If and so long as the holder of the Debt Securities is InCapS
Funding II, Ltd. or a trustee thereof, the Company will cause copies of the
annual financial statements of the Company and/or Affiliates that are filed
with the insurance regulator in each jurisdiction in which the Company or any
such Affiliate is incorporated to be delivered, by hard copy or electronic
transmission, to the holder of the Debt Securities promptly following their
filing.
PAGE 25
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
SECTION 5.01 EVENTS OF DEFAULT.
-----------------
The following events shall be "Events of Default" with respect to Debt
Securities:
(a) the Company defaults in the payment of any interest upon any Debt
Security when it becomes due and payable, and continuance of such default for
a period of 30 days; for the avoidance of doubt, an extension of any interest
payment period by the Company in accordance with Section 2.11 of this Indenture
shall not constitute a default under this clause 5.01(a); or
(b) the Company defaults in the payment of all or any part of the
principal of (or premium, if any, on) any Debt Securities as and when the same
shall become due and payable, whether at maturity, upon redemption, by
acceleration of maturity pursuant to Section 5.01 of this Indenture or
otherwise; or
(c) the Company defaults in the performance of, or breaches, any of its
covenants or agreements in Sections 3.06, 3.07, 3.08 or 3.09 of this Indenture
(other than a covenant or agreement a default in whose performance or whose
breach is elsewhere in this Section specifically dealt with), and continuance
of such default or breach for a period of 90 days after there has been given,
by registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the holders of not less than 25% in aggregate
principal amount of the outstanding Debt Securities, a written notice
specifying such default or breach and requiring it to be remedied and stating
that such notice is a "Notice of Default" hereunder; or
(d) a court having jurisdiction in the premises shall enter a decree or
order for relief in respect of the Company in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or appoints a receiver, liquidator, assignee, custodian, trustee,
sequestrator or other similar official of the Company or for any substantial
part of its property, or orders the winding-up or liquidation of its affairs
and such decree, appointment or order shall remain unstayed and in effect for
a period of 90 consecutive days; or
(e) the Company shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, shall
consent to the entry of an order for relief in an involuntary case under any
such law, or shall consent to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of the Company or of any substantial part of its property, or
shall make any general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due; or
(f) the Trust shall have voluntarily or involuntarily liquidated,
dissolved, wound-up its business or otherwise terminated its existence except
in connection with (1) the distribution of the Debt Securities to holders of
the Trust Securities in liquidation of their interests in the Trust, (2) the
redemption of all of the outstanding Trust Securities or (3) mergers,
consolidations or amalgamations, each as permitted by the Declaration.
PAGE 26
If an Event of Default specified under clause (a), (b) or (c) of this
Section 5.01 occurs and is continuing with respect to the Debt Securities,
then, in each and every such case, either the Trustee or the holders of not
less than 25% in aggregate principal amount of the Debt Securities then
outstanding hereunder, by notice in writing to the Company (and to the Trustee
if given by Securityholders), may declare the entire principal of the Debt
Securities and any premium and interest accrued, but unpaid, thereon to be due
and payable immediately, and upon any such declaration the same shall become
immediately due and payable. If an Event of Default specified under clause
(d), (e) or (f) of this Section 5.01 occurs, then, in each and every such case,
the entire principal amount of the Debt Securities and any premium and interest
accrued, but unpaid, thereon shall IPSO FACTO become immediately due and
payable without further action.
The foregoing provisions, however, are subject to the condition that if,
at any time after the principal of the Debt Securities shall have become due
by acceleration, and before any judgment or decree for the payment of the
moneys due shall have been obtained or entered as hereinafter provided, (i) the
Company shall pay or shall deposit with the Trustee a sum sufficient to pay all
matured installments of interest upon all the Debt Securities and all payments
in respect of the Debt Securities which shall have become due otherwise than by
acceleration (with interest upon all such payments and Deferred Interest, to
the extent permitted by law) and such amount as shall be sufficient to cover
reasonable compensation to the Trustee and each predecessor Trustee, their
respective agents, attorneys and counsel, and all other amounts due to the
Trustee pursuant to Section 6.06, if any, and (ii) all Events of Default under
this Indenture, other than the non-payment of the payments in respect of Debt
Securities which shall have become due by acceleration, shall have been cured,
waived or otherwise remedied as provided herein, then, in each and every such
case, the holders of a majority in aggregate principal amount of the Debt
Securities then outstanding, by written notice to the Company and to the
Trustee, may waive all defaults and rescind and annul such acceleration and
its consequences, but no such waiver or rescission and annulment shall extend
to or shall affect any subsequent default or shall impair any right consequent
thereon; PROVIDED, HOWEVER, that if the Debt Securities are held by the Trust
or a trustee of the Trust, such waiver or rescission and annulment shall not
be effective until the holders of a majority in aggregate liquidation amount
of the outstanding Capital Securities of the Trust shall have consented to such
waiver or rescission and annulment.
In case the Trustee shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued or abandoned
because of such rescission or annulment or for any other reason or shall have
been determined adversely to the Trustee, then and in every such case the
Company, the Trustee and the holders of the Debt Securities shall be restored
respectively to their several positions and rights hereunder, and all rights,
remedies and powers of the Company, the Trustee and the holders of the Debt
Securities shall continue as though no such proceeding had been taken.
SECTION 5.02 PAYMENT OF DEBT SECURITIES ON DEFAULT; SUIT THEREFOR.
----------------------------------------------------
The Company covenants that upon the occurrence of an Event of Default
pursuant to clause (a) or (b) of Section 5.01 and upon demand of the Trustee,
the Company will pay to the Trustee, for the benefit of the holders of the
Debt Securities, the whole amount that then shall have become due and payable
on all Debt Securities, including Deferred Interest accrued on the
PAGE 27
Debt Securities; and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including a
reasonable compensation to the Trustee, its agents, attorneys and counsel,
and any other amounts due to the Trustee under Section 6.06. In case the
Company shall fail forthwith to pay such amounts upon such demand, the Trustee,
in its own name and as trustee of an express trust, shall be entitled and
empowered to institute any actions or proceedings at law or in equity for the
collection of the sums so due and unpaid, and may prosecute any such action or
proceeding to judgment or final decree, and may enforce any such judgment or
final decree against the Company or any other obligor on such Debt Securities
and collect in the manner provided by law out of the property of the Company or
any other obligor on such Debt Securities wherever situated the moneys adjudged
or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy or for the
reorganization of the Company or any other obligor on the Debt Securities under
Bankruptcy Law, or in case a receiver or trustee shall have been appointed for
the property of the Company or such other obligor, or in the case of any other
similar judicial proceedings relative to the Company or other obligor upon the
Debt Securities, or to the creditors or property of the Company or such other
obligor, the Trustee, irrespective of whether the principal of the Debt
Securities shall then be due and payable as therein expressed or by
acceleration or otherwise and irrespective of whether the Trustee shall have
made any demand pursuant to the provisions of this Section 5.02, shall be
entitled and empowered, by intervention in such proceedings or otherwise, to
file and prove a claim or claims for the whole amount of principal and interest
owing and unpaid in respect of the Debt Securities and, in case of any judicial
proceedings, to file such proofs of claim and other papers or documents as may
be necessary or advisable in order to have the claims of the Trustee (including
any claim for reasonable compensation to the Trustee and each predecessor
Trustee, and their respective agents, attorneys and counsel, and for
reimbursement of all other amounts due to the Trustee under Section 6.06) and
of the Securityholders allowed in such judicial proceedings relative to the
Company or any other obligor on the Debt Securities, or to the creditors or
property of the Company or such other obligor, unless prohibited by applicable
law and regulations, to vote on behalf of the holders of the Debt Securities in
any election of a trustee or a standby trustee in arrangement, reorganization,
liquidation or other bankruptcy or insolvency proceedings or Person performing
similar functions in comparable proceedings, and to collect and receive any
moneys or other property payable or deliverable on any such claims, and to
distribute the same after the deduction of its charges and expenses; and any
receiver, assignee or trustee in bankruptcy or reorganization is hereby
authorized by each of the Securityholders to make such payments to the Trustee,
and, in the event that the Trustee shall consent to the making of such payments
directly to the Securityholders, to pay to the Trustee such amounts as shall be
sufficient to cover reasonable compensation to the Trustee, each predecessor
Trustee and their respective agents, attorneys and counsel, and all other
amounts due to the Trustee under Section 6.06.
Nothing herein contained shall be construed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan of reorganization, arrangement, adjustment or composition affecting the
Debt Securities or the rights of any holder thereof or to authorize the Trustee
to vote in respect of the claim of any Securityholder in any such proceeding.
PAGE 28
All rights of action and of asserting claims under this Indenture, or
under any of the Debt Securities, may be enforced by the Trustee without the
possession of any of the Debt Securities, or the production thereof at any
trial or other proceeding relative thereto, and any such suit or proceeding
instituted by the Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment shall be for the ratable benefit
of the holders of the Debt Securities.
In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party), the Trustee shall be held to represent all the
holders of the Debt Securities, and it shall not be necessary to make any
holders of the Debt Securities parties to any such proceedings.
SECTION 5.03 APPLICATION OF MONEYS COLLECTED BY TRUSTEE.
------------------------------------------
Any moneys collected by the Trustee shall be applied in the following
order, at the date or dates fixed by the Trustee for the distribution of such
moneys, upon presentation of the several Debt Securities in respect of which
moneys have been collected, and stamping thereon the payment, if only partially
paid, and upon surrender thereof if fully paid:
First: To the payment of costs and expenses incurred by, and reasonable
fees of, the Trustee, its agents, attorneys and counsel, and of all other
amounts due to the Trustee under Section 6.06;
Second: To the payment of all Senior Indebtedness of the Company if and to
the extent required by Article XV;
Third: To the payment of the amounts then due and unpaid in respect of
Debt Securities, in respect of which or for the benefit of which money has been
collected, ratably, without preference or priority of any kind, according to
the amounts due in respect of such Debt Securities; and
Fourth: The balance, if any, to the Company.
SECTION 5.04 PROCEEDINGS BY SECURITYHOLDERS.
------------------------------
No holder of any Debt Security shall have any right to institute any suit,
action or proceeding for any remedy hereunder, unless such holder previously
shall have given to the Trustee written notice of an Event of Default with
respect to the Debt Securities and unless the holders of not less than 25% in
aggregate principal amount of the Debt Securities then outstanding shall have
given the Trustee a written request to institute such action, suit or
proceeding and shall have offered to the Trustee such reasonable indemnity as
it may require against the costs, expenses and liabilities to be incurred
thereby, and the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity shall have failed to institute any such action, suit or
proceeding; PROVIDED, that no holder of Debt Securities shall have any right
to prejudice the rights of any other holder of Debt Securities, obtain priority
or preference over any other such holder or enforce any right under this
Indenture except in the manner herein provided and for the equal, ratable and
common benefit of all holders of Debt Securities.
PAGE 29
Notwithstanding any other provisions in this Indenture, the right of any
holder of any Debt Security to receive payment of the principal of and premium,
if any, and interest on such Debt Security when due, or to institute suit for
the enforcement of any such payment, shall not be impaired or affected without
the consent of such holder. For the protection and enforcement of the
provisions of this Section, each and every Securityholder and the Trustee shall
be entitled to such relief as can be given either at law or in equity.
SECTION 5.05 PROCEEDINGS BY TRUSTEE.
----------------------
In case of an Event of Default, the Trustee may in its discretion proceed
to protect and enforce the rights vested in it by this Indenture by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any of such rights, either by suit in equity or by action
at law or by proceeding in bankruptcy or otherwise, whether for the specific
enforcement of any covenant or agreement contained in this Indenture or in aid
of the exercise of any power granted in this Indenture, or to enforce any other
legal or equitable right vested in the Trustee by this Indenture or by law.
SECTION 5.06 REMEDIES CUMULATIVE AND CONTINUING.
----------------------------------
Except as otherwise provided in Section 2.06, all powers and remedies
given by this Article V to the Trustee or to the Securityholders shall, to the
extent permitted by law, be deemed cumulative and not exclusive of any other
powers and remedies available to the Trustee or the holders of the Debt
Securities, by judicial proceedings or otherwise, to enforce the performance
or observance of the covenants and agreements contained in this Indenture or
otherwise established with respect to the Debt Securities, and no delay or
omission of the Trustee or of any holder of any of the Debt Securities to
exercise any right or power accruing upon any Event of Default occurring and
continuing as aforesaid shall impair any such right or power, or shall be
construed to be a waiver of any such default or an acquiescence therein; and,
subject to the provisions of Section 5.04, every power and remedy given by this
Article V or by law to the Trustee or to the Securityholders may be exercised
from time to time, and as often as shall be deemed expedient, by the Trustee
or by the Securityholders.
SECTION 5.07 DIRECTION OF PROCEEDINGS AND WAIVER OF DEFAULTS BY
--------------------------------------------------
MAJORITY OF SECURITYHOLDERS.
- ---------------------------
The holders of a majority in aggregate principal amount of the Debt
Securities affected at the time outstanding and, if the Debt Securities are
held by the Trust or a trustee of the Trust, the holders of a majority in
aggregate liquidation amount of the outstanding Capital Securities of the Trust
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee with respect to such Debt Securities; PROVIDED,
HOWEVER, that if the Debt Securities are held by the Trust or a trustee of the
Trust, such time, method and place or such exercise, as the case may be, may
not be so directed until the holders of a majority in aggregate liquidation
amount of the outstanding Capital Securities of the Trust shall have directed
such time, method and place or such exercise, as the case may be; PROVIDED,
FURTHER, that (subject to the provisions of Section 6.01) the Trustee shall
have the right to decline to follow any such direction if the Trustee shall
determine that the action so directed would be unjustly prejudicial to the
holders
PAGE 30
not taking part in such direction or if the Trustee being advised by counsel
determines that the action or proceeding so directed may not lawfully be taken
or if a Responsible Officer of the Trustee shall determine that the action or
proceedings so directed would involve the Trustee in personal liability. Prior
to any declaration of acceleration, or IPSO FACTO acceleration, of the maturity
of the Debt Securities, the holders of a majority in aggregate principal amount
of the Debt Securities at the time outstanding may on behalf of the holders of
all of the Debt Securities waive (or modify any previously granted waiver of)
any past Default or Event of Default and its consequences, except a default
(a) in the payment of principal of or premium, if any, or interest on any of
the Debt Securities, (b) in respect of covenants or provisions hereof which
cannot be modified or amended without the consent of the holder of each Debt
Security affected, or (c) in respect of the covenants contained in Section
3.09; PROVIDED, HOWEVER, that if the Debt Securities are held by the Trust or a
trustee of the Trust, such waiver or modification to such waiver shall not be
effective until the holders of a majority in aggregate liquidation amount of
the outstanding Capital Securities of the Trust shall have consented to such
waiver or modification to such waiver; PROVIDED, FURTHER, that if the consent
of the holder of each outstanding Debt Security is required, such waiver or
modification to such waiver shall not be effective until each holder of the
outstanding Capital Securities of the Trust shall have consented to such waiver
or modification to such waiver. Upon any such waiver or modification to such
waiver, the Default or Event of Default covered thereby shall be deemed to be
cured for all purposes of this Indenture and the Company, the Trustee and the
holders of the Debt Securities shall be restored to their former positions and
rights hereunder, respectively; but no such waiver or modification to such
waiver shall extend to any subsequent or other Default or Event of Default or
impair any right consequent thereon. Whenever any Default or Event of Default
hereunder shall have been waived as permitted by this Section, said Default or
Event of Default shall for all purposes of the Debt Securities and this
Indenture be deemed to have been cured and to be not continuing.
SECTION 5.08 NOTICE OF DEFAULTS.
------------------
The Trustee shall, within 90 days after a Responsible Officer of the
Trustee shall have actual knowledge or received written notice of the
occurrence of a default with respect to the Debt Securities, mail to all
Securityholders, as the names and addresses of such holders appear upon the
Debt Security Register, notice of all defaults with respect to the Debt
Securities known to the Trustee, unless such defaults shall have been cured
before the giving of such notice (the term "default" for the purpose of this
Section is hereby defined to be any event specified in Section 5.01, not
including periods of grace, if any, provided for therein); PROVIDED, that,
except in the case of default in the payment of the principal of or premium,
if any, or interest on any of the Debt Securities, the Trustee shall be
protected in withholding such notice if and so long as a Responsible Officer
of the Trustee in good faith determines that the withholding of such notice
is in the interests of the Securityholders.
SECTION 5.09 UNDERTAKING TO PAY COSTS.
------------------------
All parties to this Indenture agree, and each holder of any Debt Security
by such holder's acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for
any action taken or omitted by it as Trustee, the filing by any party litigant
in such suit of an undertaking to pay the costs of such suit, and that such
court may in its
PAGE 31
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section shall not apply to any suit instituted by
the Trustee, to any suit instituted by any Securityholder, or group of
Securityholders, holding in the aggregate more than 10% in principal amount of
the outstanding Debt Securities (or, if such Debt Securities are held by the
Trust or a trustee of the Trust, more than 10% in liquidation amount of the
outstanding Capital Securities),to any suit instituted by any Securityholder
for the enforcement of the payment of the principal of or premium, if any, or
interest on any Debt Security against the Company on or after the same shall
have become due and payable or to any suit instituted in accordance with
Section 14.12.
ARTICLE VI
CONCERNING THE TRUSTEE
SECTION 6.01 DUTIES AND RESPONSIBILITIES OF TRUSTEE.
--------------------------------------
With respect to the holders of Debt Securities issued hereunder, the
Trustee, prior to the occurrence of an Event of Default and after the curing
or waiving of all Events of Default which may have occurred, undertakes to
perform such duties and only such duties as are specifically set forth in this
Indenture. In case an Event of Default has occurred (which has not been cured
or waived), the Trustee shall exercise such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in their
exercise, as a prudent person would exercise or use under the circumstances in
the conduct of such person's own affairs.
No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act
or its own willful misconduct or bad faith, except that:
(a) prior to the occurrence of an Event of Default and after the curing
or waiving of all Events of Default which may have occurred:
(i) the duties and obligations of the Trustee with respect to the
Debt Securities shall be determined solely by the express provisions of this
Indenture, and the Trustee shall not be liable except for the performance of
such duties and obligations with respect to the Debt Securities as are
specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Trustee and conforming to the requirements of this
Indenture; but, in the case of any such certificates or opinions which by
any provision hereof are specifically required to be furnished to the
Trustee, the Trustee shall be under a duty to examine the same to determine
whether or not they conform on their face to the requirements of this
Indenture;
(b) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Officers of the Trustee, unless it shall
be proved that the Trustee was negligent in ascertaining the pertinent facts;
PAGE 32
(c) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith, in accordance with the direction of
the Securityholders pursuant to Section 5.07, relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Indenture;
and
(d) the Trustee shall not be charged with knowledge of any Default or
Event of Default with respect to the Debt Securities unless either (1) a
Responsible Officer shall have actual knowledge of such Default or Event of
Default or (2) written notice of such Default or Event of Default shall have
been given to the Trustee by the Company or any other obligor on the Debt
Securities or by any holder of the Debt Securities, except that the Trustee
shall be deemed to have knowledge of any Event of Default pursuant to Sections
5.01(a) or 5.01(b) hereof (other than an Event of Default resulting from the
default in the payment of Additional Interest if the Trustee does not have
actual knowledge or written notice that such payment is due and payable).
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers.
SECTION 6.02 RELIANCE ON DOCUMENTS, OPINIONS, ETC.
------------------------------------
Except as otherwise provided in Section 6.01:
(a) the Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, bond, note,
debenture or other paper or document believed by it in good faith to be genuine
and to have been signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by an Officers' Certificate (unless
other evidence in respect thereof be herein specifically prescribed); and any
Board Resolution may be evidenced to the Trustee by a copy thereof certified by
the Secretary or an Assistant Secretary of the Company;
(c) the Trustee may consult with counsel of its selection and any advice
or Opinion of Counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders, pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or omitted by it
in good faith and reasonably believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Indenture; nothing
contained herein shall, however, relieve the Trustee
PAGE 33
of the obligation, upon the occurrence of an Event of Default (which has not
been cured or waived) to exercise such of the rights and powers vested in it by
this Indenture, and to use the same degree of care and skill in their exercise,
as a prudent person would exercise or use under the circumstances in the
conduct of such person's own affairs;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, debenture,
coupon or other paper or document, unless requested in writing to do so by the
holders of a majority in aggregate principal amount of the outstanding Debt
Securities affected thereby; PROVIDED, HOWEVER, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded to it
by the terms of this Indenture, the Trustee may require reasonable indemnity
against such expense or liability as a condition to so proceeding; and
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents (including
any Authenticating Agent) or attorneys, and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such agent or
attorney appointed by it with due care.
SECTION 6.03 NO RESPONSIBILITY FOR RECITALS, ETC.
-----------------------------------
The recitals contained herein and in the Debt Securities (except in the
certificate of authentication of the Trustee or the Authenticating Agent)
shall be taken as the statements of the Company, and the Trustee and the
Authenticating Agent assume no responsibility for the correctness of the same.
The Trustee and the Authenticating Agent make no representations as to the
validity or sufficiency of this Indenture or of the Debt Securities. The
Trustee and the Authenticating Agent shall not be accountable for the use or
application by the Company of any Debt Securities or the proceeds of any Debt
Securities authenticated and delivered by the Trustee or the Authenticating
Agent in conformity with the provisions of this Indenture.
SECTION 6.04 TRUSTEE, AUTHENTICATING AGENT, PAYING AGENTS, TRANSFER
------------------------------------------------------
AGENTS OR REGISTRAR MAY OWN DEBT SECURITIES.
- -------------------------------------------
The Trustee, any Authenticating Agent, any Paying Agent, any transfer
agent or any Debt Security registrar, in its individual or any other capacity,
may become the owner or pledgee of Debt Securities with the same rights it
would have if it were not Trustee, Authenticating Agent, Paying Agent, transfer
agent or Debt Security registrar.
SECTION 6.05 MONEYS TO BE HELD IN TRUST.
--------------------------
Subject to the provisions of Section 12.04, all moneys received by the
Trustee or any Paying Agent shall, until used or applied as herein provided, be
held in trust for the purpose for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee
and any Paying Agent shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the
Company. So long as no Event of Default shall have occurred and be continuing,
all interest allowed on any such moneys, if any, shall be paid from time to
time to the Company upon the written order of
PAGE 34
the Company, signed by the Chairman of the Board of Directors, the President,
the Chief Operating Officer, a Vice President, the Treasurer or an Assistant
Treasurer of the Company.
SECTION 6.06 COMPENSATION AND EXPENSES OF TRUSTEE.
------------------------------------
The Company covenants and agrees to pay to the Trustee from time to time,
and the Trustee shall be entitled to, such compensation as shall be agreed to
in writing between the Company and the Trustee (which shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust), and the Company will pay or reimburse the Trustee upon its written
request for all documented reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any of the provisions of
this Indenture (including the reasonable compensation and the reasonable
expenses and disbursements of its counsel and of all Persons not regularly in
its employ) except any such expense, disbursement or advance that arises from
its negligence, willful misconduct or bad faith. The Company also covenants to
indemnify each of the Trustee (including in its individual capacity) and any
predecessor Trustee (and its officers, agents, directors and employees) for,
and to hold it harmless against, any and all loss, damage, claim, liability or
expense including taxes (other than taxes based on the income of the Trustee),
except to the extent such loss, damage, claim, liability or expense results
from the negligence, willful misconduct or bad faith of such indemnitee,
arising out of or in connection with the acceptance or administration of this
trust, including the costs and expenses of defending itself against any claim
or liability in the premises. The obligations of the Company under this
Section to compensate and indemnify the Trustee and to pay or reimburse the
Trustee for documented expenses, disbursements and advances shall constitute
additional indebtedness hereunder. Such additional indebtedness shall be
secured by a lien prior to that of the Debt Securities upon all property and
funds held or collected by the Trustee as such, except funds held in trust for
the benefit of the holders of particular Debt Securities.
Without prejudice to any other rights available to the Trustee under
applicable law, when the Trustee incurs expenses or renders services in
connection with an Event of Default specified in clause (d), (e) or (f) of
Section 5.01, the expenses (including the reasonable charges and expenses of
its counsel) and the compensation for the services are intended to constitute
expenses of administration under any applicable federal or state bankruptcy,
insolvency or other similar law.
The provisions of this Section shall survive the resignation or removal of
the Trustee and the defeasance or other termination of this Indenture.
Notwithstanding anything in this Indenture or any Debt Security to the
contrary, the Trustee shall have no obligation whatsoever to advance funds to
pay any principal of or interest on or other amounts with respect to the Debt
Securities or otherwise advance funds to or on behalf of the Company.
SECTION 6.07 OFFICERS' CERTIFICATE AS EVIDENCE.
---------------------------------
Except as otherwise provided in Sections 6.01 and 6.02, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable
PAGE 35
that a matter be proved or established prior to taking or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence, willful misconduct
or bad faith on the part of the Trustee, be deemed to be conclusively proved
and established by an Officers' Certificate delivered to the Trustee, and such
certificate, in the absence of negligence, willful misconduct or bad faith on
the part of the Trustee, shall be full warrant to the Trustee for any action
taken or omitted by it under the provisions of this Indenture upon the faith
thereof.
SECTION 6.08 ELIGIBILITY OF TRUSTEE.
----------------------
The Trustee hereunder shall at all times be a U.S. Person that is a
banking corporation or national association organized and doing business under
the laws of the United States of America or any state thereof or of the
District of Columbia and authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least fifty million U.S.
dollars ($50,000,000) and subject to supervision or examination by federal,
state, or District of Columbia authority. If such corporation or national
association publishes reports of condition at least annually, pursuant to law
or to the requirements of the aforesaid supervising or examining authority,
then for the purposes of this Section the combined capital and surplus of such
corporation or national association shall be deemed to be its combined capital
and surplus as set forth in its most recent records of condition so published.
The Company may not, nor may any Person directly or indirectly
controlling, controlled by, or under common control with the Company, serve as
Trustee, notwithstanding that such corporation or national association shall be
otherwise eligible and qualified under this Article.
In case at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section, the Trustee shall resign immediately in
the manner and with the effect specified in Section 6.09.
If the Trustee has or shall acquire any "conflicting interest" within the
meaning of Section 310(b) of the Trust Indenture Act, the Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to, this Indenture.
SECTION 6.09 RESIGNATION OR REMOVAL OF TRUSTEE.
---------------------------------
(a) The Trustee, or any trustee or trustees hereafter appointed, may at
any time resign by giving written notice of such resignation to the Company and
by mailing notice thereof, at the Company's expense, to the holders of the Debt
Securities at their addresses as they shall appear on the Debt Security
Register. Upon receiving such notice of resignation, the Company shall
promptly appoint a successor trustee or trustees by written instrument, in
duplicate, executed by order of its Board of Directors, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor Trustee. If no successor Trustee shall have been so appointed and
have accepted appointment within 30 days after the mailing of such notice of
resignation to the affected Securityholders, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a successor Trustee,
or any Securityholder who has been a bona fide holder of a Debt Security or
Debt Securities for at least six months
PAGE 36
may, subject to the provisions of Section 5.09, on behalf of himself or herself
and all others similarly situated, petition any such court for the appointment
of a successor Trustee. Such court may thereupon, after such notice, if any,
as it may deem proper and prescribe, appoint a successor Trustee.
(b) In case at any time any of the following shall occur:
(i) the Trustee shall fail to comply with the provisions of the
last paragraph of Section 6.08 after written request therefor by the Company
or by any Securityholder who has been a bona fide holder of a Debt Security
or Debt Securities for at least six months;
(ii) the Trustee shall cease to be eligible in accordance with the
provisions of Section 6.08 and shall fail to resign after written request
therefor by the Company or by any such Securityholder; or
(iii) the Trustee shall become incapable of acting, or shall be
adjudged bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, the Company may remove the Trustee and appoint a
successor Trustee by written instrument, in duplicate, executed by order of the
Board of Directors, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor Trustee, or, subject to the
provisions of Section 5.09, if no successor Trustee shall have been so
appointed and have accepted appointment within 30 days of the occurrence of any
of (i), (ii) or (iii) above, any Securityholder who has been a bona fide holder
of a Debt Security or Debt Securities for at least six months may, on behalf of
himself or herself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, remove the Trustee and appoint a successor
Trustee.
(c) Upon prior written notice to the Company and the Trustee, the holders
of a majority in aggregate principal amount of the Debt Securities at the time
outstanding may at any time remove the Trustee and nominate a successor
Trustee, which shall be deemed appointed as successor Trustee unless within ten
Business Days after such nomination the Company objects thereto, in which case
or in the case of a failure by such holders to nominate a successor Trustee,
the Trustee so removed or any Securityholder, upon the terms and conditions and
otherwise as in subsection (a) of this Section, may petition any court of
competent jurisdiction for an appointment of a successor.
(d) Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor Trustee as
provided in Section 6.10.
PAGE 37
SECTION 6.10 ACCEPTANCE BY SUCCESSOR TRUSTEE.
-------------------------------
Any successor Trustee appointed as provided in Section 6.09 shall execute,
acknowledge and deliver to the Company and to its predecessor Trustee an
indenture supplemental hereto which shall contain such provisions as shall be
deemed necessary or desirable to confirm that all of the rights, powers, trusts
and duties of the retiring Trustee shall be vested in the successor Trustee,
and thereupon the resignation or removal of the retiring Trustee shall become
effective and such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, duties and
obligations with respect to the Debt Securities of its predecessor hereunder,
with like effect as if originally named as Trustee herein; but, nevertheless,
on the written request of the Company or of the successor Trustee, the Trustee
ceasing to act shall, upon payment of the amounts then due it pursuant to the
provisions of Section 6.06, execute and deliver an instrument transferring to
such successor Trustee all the rights and powers of the Trustee so ceasing to
act and shall duly assign, transfer and deliver to such successor Trustee all
property and money held by such retiring Trustee hereunder. Upon request of
any such successor Trustee, the Company shall execute any and all instruments
in writing for more fully and certainly vesting in and confirming to such
successor Trustee all such rights and powers. Any Trustee ceasing to act
shall, nevertheless, retain a lien upon all property or funds held or collected
by such Trustee to secure any amounts then due it pursuant to the provisions of
Section 6.06.
No successor Trustee shall accept appointment as provided in this Section
unless at the time of such acceptance such successor Trustee shall be eligible
and qualified under the provisions of Section 6.08.
In no event shall a retiring Trustee be liable for the acts or omissions
of any successor Trustee hereunder.
Upon acceptance of appointment by a successor Trustee as provided in this
Section, the Company shall mail notice of the succession of such Trustee
hereunder to the holders of Debt Securities at their addresses as they shall
appear on the Debt Security Register. If the Company fails to mail such notice
within ten Business Days after the acceptance of appointment by the successor
Trustee, the successor Trustee shall cause such notice to be mailed at the
expense of the Company.
SECTION 6.11 SUCCESSION BY MERGER, ETC.
-------------------------
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder
without the execution or filing of any paper or any further act on the part of
any of the parties hereto, PROVIDED, that such corporation shall be otherwise
eligible and qualified under this Article.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Debt Securities shall have been
authenticated but not delivered, any
PAGE 38
such successor to the Trustee may adopt the certificate of authentication of
any predecessor Trustee, and deliver such Debt Securities so authenticated;
and in case at that time any of the Debt Securities shall not have been
authenticated, any successor to the Trustee may authenticate such Debt
Securities either in the name of any predecessor hereunder or in the name of
the successor Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Debt Securities or in this Indenture
provided that the certificate of the Trustee shall have; PROVIDED, HOWEVER,
that the right to adopt the certificate of authentication of any predecessor
Trustee or authenticate Debt Securities in the name of any predecessor Trustee
shall apply only to its successor or successors by merger, conversion or
consolidation.
SECTION 6.12 AUTHENTICATING AGENTS.
---------------------
There may be one or more Authenticating Agents appointed by the Trustee
upon the request of the Company with power to act on its behalf and subject to
its direction in the authentication and delivery of Debt Securities issued upon
exchange or registration of transfer thereof as fully to all intents and
purposes as though any such Authenticating Agent had been expressly authorized
to authenticate and deliver Debt Securities; PROVIDED, HOWEVER, that the
Trustee shall not have any liability to the Company for any acts or omissions
of the Authenticating Agent with respect to the authentication and delivery of
Debt Securities. Any such Authenticating Agent shall at all times be a
corporation organized and doing business under the laws of the United States or
of any state thereof or of the District of Columbia authorized under such laws
to act as Authenticating Agent, having a combined capital and surplus of at
least $50,000,000 and being subject to supervision or examination by federal,
state or District of Columbia authority. If such corporation publishes reports
of condition at least annually pursuant to law or the requirements of such
authority, then for the purposes of this Section the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If
at any time an Authenticating Agent shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect herein specified in this Section.
Any corporation into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate trust business of any Authenticating Agent, shall be the
successor of such Authenticating Agent hereunder, if such successor corporation
is otherwise eligible under this Section without the execution or filing of any
paper or any further act on the part of the parties hereto or such
Authenticating Agent.
Any Authenticating Agent may at any time resign by giving written notice
of resignation to the Trustee and to the Company. The Trustee may at any time
terminate the agency of any Authenticating Agent with respect to the Debt
Securities by giving written notice of termination to such Authenticating Agent
and to the Company. Upon receiving such a notice of resignation or upon such a
termination, or in case at any time any Authenticating Agent shall cease to be
eligible under this Section, the Trustee may, and upon the request of the
Company shall, promptly appoint a successor Authenticating Agent eligible under
this Section, shall give written notice of such appointment to the Company and
shall mail notice of such appointment to all holders of Debt Securities as the
names and addresses of such holders appear on the Debt
PAGE 39
Security Register. Any successor Authenticating Agent, upon acceptance of its
appointment hereunder, shall become vested with all rights, powers, duties and
responsibilities of its predecessor hereunder, with like effect as if
originally named as Authenticating Agent herein.
The Company agrees to pay to any Authenticating Agent from time to time
reasonable compensation for its services. Any Authenticating Agent shall have
no responsibility or liability for any action taken by it as such in accordance
with the directions of the Trustee.
ARTICLE VII
CONCERNING THE SECURITYHOLDERS
SECTION 7.01 ACTION BY SECURITYHOLDERS.
-------------------------
Whenever in this Indenture it is provided that the holders of a specified
percentage in aggregate principal amount of the Debt Securities or aggregate
liquidation amount of the Capital Securities may take any action (including the
making of any demand or request, the giving of any notice, consent or waiver or
the taking of any other action), the fact that at the time of taking any such
action the holders of such specified percentage have joined therein may be
evidenced (a) by any instrument or any number of instruments of similar tenor
executed by such Securityholders or holders of Capital Securities, as the case
may be, in person or by agent or proxy appointed in writing, or (b) by the
record of such holders of Debt Securities voting in favor thereof at any
meeting of such Securityholders duly called and held in accordance with the
provisions of Article VIII or of such holders of Capital Securities duly called
and held in accordance with the provisions of the Declaration or (c) by a
combination of such instrument or instruments and any such record of such a
meeting of such Securityholders or holders of Capital Securities, as the case
may be, or (d) by any other method the Trustee deems satisfactory.
If the Company shall solicit from the Securityholders any request, demand,
authorization, direction, notice, consent, waiver or other action or revocation
of the same, the Company may, at its option, as evidenced by an Officers'
Certificate, fix in advance a record date for such Debt Securities for the
determination of Securityholders entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other action or revocation
of the same, but the Company shall have no obligation to do so. If such a
record date is fixed, such request, demand, authorization, direction, notice,
consent, waiver or other action or revocation of the same may be given before
or after the record date, but only the Securityholders of record at the close
of business on the record date shall be deemed to be Securityholders for the
purposes of determining whether Securityholders of the requisite proportion of
outstanding Debt Securities have authorized or agreed or consented to such
request, demand, authorization, direction, notice, consent, waiver or other
action or revocation of the same, and for that purpose the outstanding Debt
Securities shall be computed as of the record date; PROVIDED, HOWEVER, that no
such authorization, agreement or consent by such Securityholders on the record
date shall be deemed effective unless it shall become effective pursuant to the
provisions of this Indenture not later than six months after the record date.
PAGE 40
SECTION 7.02 PROOF OF EXECUTION BY SECURITYHOLDERS.
-------------------------------------
Subject to the provisions of Sections 6.01, 6.02 and 8.05, proof of the
execution of any instrument by a Securityholder or such Securityholder's agent
or proxy shall be sufficient if made in accordance with such reasonable rules
and regulations as may be prescribed by the Trustee or in such manner as shall
be satisfactory to the Trustee. The ownership of Debt Securities shall be
proved by the Debt Security Register or by a certificate of the Debt Security
registrar. The Trustee may require such additional proof of any matter
referred to in this Section as it shall deem necessary.
The record of any Securityholders' meeting shall be proved in the manner
provided in Section 8.06.
SECTION 7.03 WHO ARE DEEMED ABSOLUTE OWNERS.
------------------------------
Prior to due presentment for registration of transfer of any Debt
Security, the Company, the Trustee, any Authenticating Agent, any Paying Agent,
any transfer agent and any Debt Security registrar may deem the Person in whose
name such Debt Security shall be registered upon the Debt Security Register to
be, and may treat such Person as, the absolute owner of such Debt Security
(whether or not such Debt Security shall be overdue) for the purpose of
receiving payment of or on account of the principal of and premium, if any, and
interest on such Debt Security and for all other purposes; and none of the
Company, the Trustee, any Authenticating Agent, any Paying Agent, any transfer
agent or any Debt Security registrar shall be affected by any notice to the
contrary. All such payments so made to any holder for the time being or upon
such holder's order shall be valid, and, to the extent of the sum or sums so
paid, effectual to satisfy and discharge the liability for moneys payable upon
any such Debt Security.
SECTION 7.04 DEBT SECURITIES OWNED BY COMPANY DEEMED NOT
-------------------------------------------
OUTSTANDING.
- -----------
In determining whether the holders of the requisite aggregate principal
amount of Debt Securities have concurred in any direction, consent or waiver
under this Indenture, Debt Securities which are owned by the Company or any
other obligor on the Debt Securities or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Company (other than the Trust) or any other obligor on the Debt Securities
shall be disregarded and deemed not to be outstanding for the purpose of any
such determination, PROVIDED, that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, consent or waiver,
only Debt Securities which a Responsible Officer of the Trustee actually knows
are so owned shall be so disregarded. Debt Securities so owned which have been
pledged in good faith may be regarded as outstanding for the purposes of this
Section if the pledgee shall establish to the satisfaction of the Trustee the
pledgee's right to vote such Debt Securities and that the pledgee is not the
Company or any such other obligor or Person directly or indirectly controlling
or controlled by or under direct or indirect common control with the Company or
any such other obligor. In the case of a dispute as to such right, any
decision by the Trustee taken upon the advice of counsel shall be full
protection to the Trustee.
PAGE 41
SECTION 7.05 REVOCATION OF CONSENTS; FUTURE HOLDERS BOUND.
--------------------------------------------
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 7.01, of the taking of any action by the holders of the
percentage in aggregate principal amount of the Debt Securities specified in
this Indenture in connection with such action, any holder (in cases where no
record date has been set pursuant to Section 7.01) or any holder as of an
applicable record date (in cases where a record date has been set pursuant to
Section 7.01) of a Debt Security (or any Debt Security issued in whole or in
part in exchange or substitution therefor) the serial number of which is shown
by the evidence to be included in the Debt Securities the holders of which have
consented to such action may, by filing written notice with the Trustee at the
Principal Office of the Trustee and upon proof of holding as provided in
Section 7.02, revoke such action so far as concerns such Debt Security (or so
far as concerns the principal amount represented by any exchanged or
substituted Debt Security). Except as aforesaid any such action taken by the
holder of any Debt Security shall be conclusive and binding upon such holder
and upon all future holders and owners of such Debt Security, and of any Debt
Security issued in exchange or substitution therefor or on registration of
transfer thereof, irrespective of whether or not any notation in regard thereto
is made upon such Debt Security or any Debt Security issued in exchange or
substitution therefor.
ARTICLE VIII
SECURITYHOLDERS' MEETINGS
SECTION 8.01 PURPOSES OF MEETINGS.
--------------------
A meeting of Securityholders may be called at any time and from time to
time pursuant to the provisions of this Article VIII for any of the following
purposes:
(a) to give any notice to the Company or to the Trustee, or to give any
directions to the Trustee, or to consent to the waiving of any default
hereunder and its consequences, or to take any other action authorized
to be taken by Securityholders pursuant to any of the provisions of Article V;
(b) to remove the Trustee and nominate a successor trustee pursuant to
the provisions of Article VI;
(c) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 9.02; or
(d) to take any other action authorized to be taken by or on behalf of
the holders of any specified aggregate principal amount of such Debt Securities
under any other provision of this Indenture or under applicable law.
SECTION 8.02 CALL OF MEETINGS BY TRUSTEE.
---------------------------
The Trustee may at any time call a meeting of Securityholders to take any
action specified in Section 8.01, to be held at such time and at such place in
The City of New York, the Borough of Manhattan, or Wilmington, Delaware, as the
Trustee shall determine. Notice of every meeting of the Securityholders,
setting forth the time and the place of such meeting and in
PAGE 42
general terms the action proposed to be taken at such meeting, shall be mailed
to holders of Debt Securities affected at their addresses as they shall appear
on the Debt Securities Register. Such notice shall be mailed not less than 20
nor more than 180 days prior to the date fixed for the meeting.
SECTION 8.03 CALL OF MEETINGS BY COMPANY OR SECURITYHOLDERS.
----------------------------------------------
In case at any time the Company pursuant to a Board Resolution, or the
holders of at least 10% in aggregate principal amount of the Debt Securities,
as the case may be, then outstanding, shall have requested the Trustee to
call a meeting of Securityholders, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have mailed the notice of such meeting within 20 days after
receipt of such request, then the Company or such Securityholders may determine
the time and the place in Chandler, Oklahoma for such meeting and may call such
meeting to take any action authorized in Section 8.01, by mailing notice
thereof as provided in Section 8.02.
SECTION 8.04 QUALIFICATIONS FOR VOTING.
-------------------------
To be entitled to vote at any meeting of Securityholders a Person shall be
(a) a holder of one or more Debt Securities or (b) a Person appointed by an
instrument in writing as proxy by a holder of one or more Debt Securities. The
only Persons who shall be entitled to be present or to speak at any meeting of
Securityholders shall be the Persons entitled to vote at such meeting and their
counsel and any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.
SECTION 8.05 REGULATIONS.
-----------
Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Securityholders, in regard to proof of the holding of Debt Securities and of
the appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates
and other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall deem appropriate.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in Section 8.03, in which case the
Company or the Securityholders calling the meeting, as the case may be, shall
in like manner appoint a temporary chairman. A permanent chairman and a
permanent secretary of the meeting shall be elected by majority vote at the
meeting.
Subject to the provisions of Section 7.04, at any meeting each holder of
Debt Securities with respect to which such meeting is being held or proxy
therefor shall be entitled to one vote for each $1,000 principal amount of Debt
Securities held or represented by such holder; PROVIDED, HOWEVER, that no vote
shall be cast or counted at any meeting in respect of any Debt Security
challenged as not outstanding and ruled by the chairman of the meeting to be
not outstanding. The chairman of the meeting shall have no right to vote other
than by virtue of Debt Securities held by such chairman or instruments in
writing as aforesaid duly designating such chairman as the Person to vote on
behalf of other Securityholders. Any meeting of
PAGE 43
Securityholders duly called pursuant to the provisions of Section 8.02 or 8.03
may be adjourned from time to time by a majority of those present, whether or
not constituting a quorum, and the meeting may be held as so adjourned without
further notice.
SECTION 8.06 VOTING.
------
The vote upon any resolution submitted to any meeting of holders of Debt
Securities with respect to which such meeting is being held shall be by written
ballots on which shall be subscribed the signatures of such holders or of their
representatives by proxy and the serial number or numbers of the Debt
Securities held or represented by them. The permanent chairman of the meeting
shall appoint two inspectors of votes who shall count all votes cast at the
meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in triplicate of all
votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of Securityholders shall be prepared by the secretary of the meeting
and there shall be attached to said record the original reports of the
inspectors of votes on any vote by ballot taken thereat and affidavits by one
or more Persons having knowledge of the facts setting forth a copy of the
notice of the meeting and showing that said notice was mailed as provided in
Section 8.02. The record shall show the serial numbers of the Debt Securities
voting in favor of or against any resolution. The record shall be signed and
verified by the affidavits of the permanent chairman and secretary of the
meeting and one of the duplicates shall be delivered to the Company and the
other to the Trustee to be preserved by the Trustee, the latter to have
attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
SECTION 8.07 QUORUM; ACTIONS.
---------------
The Persons entitled to vote a majority in aggregate principal amount of
the Debt Securities then outstanding shall constitute a quorum for a meeting
of Securityholders; PROVIDED, HOWEVER, that if any action is to be taken at
such meeting with respect to a consent, waiver, request, demand, notice,
authorization, direction or other action which may be given by the holders
of not less than a specified percentage in aggregate principal amount of the
Debt Securities then outstanding, the Persons holding or representing such
specified percentage in aggregate principal amount of the Debt Securities then
outstanding will constitute a quorum. In the absence of a quorum within 30
minutes of the time appointed for any such meeting, the meeting shall, if
convened at the request of Securityholders, be dissolved. In any other case,
the meeting may be adjourned for a period of not less than 10 days as
determined by the permanent chairman of the meeting prior to the adjournment
of such meeting. In the absence of a quorum at any such adjourned meeting,
such adjourned meeting may be further adjourned for a period of not less than
10 days as determined by the permanent chairman of the meeting prior to the
adjournment of such adjourned meeting. Notice of the reconvening of any
adjourned meeting shall be given as provided in Section 8.02, except that such
notice need be given only once not less than five days prior to the date on
which the meeting is scheduled to be reconvened. Notice of the reconvening of
an adjourned meeting shall state expressly the percentage, as provided above,
of the aggregate principal amount of the Debt Securities then outstanding which
shall constitute a quorum.
PAGE 44
Except as limited by the proviso in the first paragraph of Section 9.02,
any resolution presented to a meeting or adjourned meeting duly reconvened at
which a quorum is present as aforesaid may be adopted by the affirmative vote
of the holders of a majority in aggregate principal amount of the Debt
Securities then outstanding; PROVIDED, HOWEVER, that, except as limited by the
proviso in the first paragraph of Section 9.02, any resolution with respect to
any consent, waiver, request, demand, notice, authorization, direction or other
action that this Indenture expressly provides may be given by the holders of
not less than a specified percentage in outstanding principal amount of the
Debt Securities may be adopted at a meeting or an adjourned meeting duly
reconvened and at which a quorum is present as aforesaid only by the
affirmative vote of the holders of not less than such specified percentage in
aggregate principal amount of the Debt Securities then outstanding.
Any resolution passed or decision taken at any meeting of holders of Debt
Securities duly held in accordance with this Section shall be binding on all
the Securityholders, whether or not present or represented at the meeting.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.01 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
------------------------------------------
SECURITYHOLDERS.
- ---------------
The Company, when authorized by a Board Resolution, and the Trustee may
from time to time and at any time enter into an indenture or indentures
supplemental hereto, without the consent of the Securityholders, for one or
more of the following purposes:
(a) to evidence the succession of another corporation to the Company,
or successive successions, and the assumption by the successor corporation
of the covenants, agreements and obligations of the Company, pursuant to
Article XI hereof;
(b) to add to the covenants of the Company such further covenants,
restrictions or conditions for the protection of the holders of Debt Securities
as the Board of Directors shall consider to be for the protection of the
holders of such Debt Securities, and to make the occurrence, or the occurrence
and continuance, of a Default in any of such additional covenants, restrictions
or conditions a Default or an Event of Default permitting the enforcement of
all or any of the several remedies provided in this Indenture as herein set
forth; PROVIDED, HOWEVER, that in respect of any such additional covenant,
restriction or condition such supplemental indenture may provide for a
particular period of grace after Default (which period may be shorter or
longer than that allowed in the case of other Defaults) or may provide for an
immediate enforcement upon such Default or may limit the remedies available to
the Trustee upon such default;
(c) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provision contained herein or in any supplemental
indenture, or to make such other provisions in regard to matters or questions
arising under this Indenture, PROVIDED, that any such action shall not
adversely affect the interests of the holders of the Debt Securities then
outstanding;
PAGE 45
(d) to add to, delete from, or revise the terms of Debt Securities,
including, without limitation, any terms relating to the issuance, exchange,
registration or transfer of Debt Securities, including to provide for transfer
procedures and restrictions substantially similar to those applicable to the
Capital Securities, as required by Section 2.05 (for purposes of assuring that
no registration of Debt Securities is required under the Securities Act of
1933, as amended), PROVIDED, that any such action shall not adversely affect
the interests of the holders of the Debt Securities then outstanding (it being
understood, for purposes of this proviso, that transfer restrictions on Debt
Securities substantially similar to those applicable to Capital Securities
shall not be deemed to adversely affect the holders of the Debt Securities);
(e) to evidence and provide for the acceptance of appointment hereunder
by a successor Trustee and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 6.10;
(f) to make any change (other than as elsewhere provided in this Section)
that does not adversely affect the rights of any Securityholder in any material
respect; or
(g) to provide for the issuance of and establish the form and terms and
conditions of the Debt Securities, to establish the form of any certifications
required to be furnished pursuant to the terms of this Indenture or the Debt
Securities, or to add to the rights of the holders of Debt Securities.
The Trustee is hereby authorized to join with the Company in the execution
of any such supplemental indenture, to make any further appropriate agreements
and stipulations which may be therein contained and to accept the conveyance,
transfer and assignment of any property thereunder, but the Trustee shall not
be obligated to, but may in its discretion, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this Section
may be executed by the Company and the Trustee without the consent of the
holders of any of the Debt Securities at the time outstanding, notwithstanding
any of the provisions of Section 9.02.
SECTION 9.02 SUPPLEMENTAL INDENTURES WITH CONSENT OF SECURITYHOLDERS.
-------------------------------------------------------
With the consent (evidenced as provided in Section 7.01) of the holders
of a majority in aggregate principal amount of the Debt Securities at the time
outstanding affected by such supplemental indenture, the Company, when
authorized by a Board Resolution, and the Trustee may from time to time and at
any time enter into an indenture or indentures supplemental hereto (which shall
conform to the provisions of the Trust Indenture Act, then in effect,
applicable to indentures qualified thereunder) for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of any supplemental indenture or of modifying in any manner
the rights of the holders of the Debt Securities; PROVIDED, HOWEVER, that no
such supplemental indenture shall, without the consent of the holders of each
Debt Security then outstanding and affected thereby, (i) change the Maturity
Date of any Debt Security, or reduce the principal amount thereof or any
premium thereon, or
PAGE 46
reduce the rate (or manner of calculation of the rate) or extend the time of
payment of interest thereon, or reduce (other than as a result of the maturity
or earlier redemption of any such Debt Security in accordance with the terms of
this Indenture and such Debt Security) or increase the aggregate principal
amount of Debt Securities then outstanding, or change any of the redemption
provisions, or make the principal thereof or any interest or premium thereon
payable in any coin or currency other than United States Dollars, or impair or
affect the right of any Securityholder to institute suit for payment thereof,
or (ii) reduce the aforesaid percentage of Debt Securities the holders of which
are required to consent to any such supplemental indenture; and PROVIDED,
FURTHER, that if the Debt Securities are held by the Trust or the trustee of
the Trust, such supplemental indenture shall not be effective until the holders
of a majority in aggregate liquidation amount of the outstanding Capital
Securities shall have consented to such supplemental indenture; PROVIDED,
FURTHER, that if the consent of the Securityholder of each outstanding Debt
Security is required, such supplemental indenture shall not be effective until
each holder of the outstanding Capital Securities shall have consented to such
supplemental indenture.
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of Securityholders (and
holders of Capital Securities, if required) as aforesaid, the Trustee shall
join with the Company in the execution of such supplemental indenture unless
such supplemental indenture affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such supplemental
indenture.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Trustee
shall transmit by mail, first class postage prepaid, a notice, prepared by the
Company, setting forth in general terms the substance of such supplemental
indenture, to the Securityholders as their names and addresses appear upon the
Debt Security Register. Any failure of the Trustee to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any such supplemental indenture.
It shall not be necessary for the consent of the Securityholders under
this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
SECTION 9.03 EFFECT OF SUPPLEMENTAL INDENTURES.
---------------------------------
Upon the execution of any supplemental indenture pursuant to the
provisions of this Article IX, this Indenture shall be, and shall be deemed to
be, modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this Indenture
of the Trustee, the Company and the holders of Debt Securities shall thereafter
be determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
PAGE 47
SECTION 9.04 NOTATION ON DEBT SECURITIES.
---------------------------
Debt Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article IX may bear a
notation as to any matter provided for in such supplemental indenture. If the
Company or the Trustee shall so determine, new Debt Securities so modified as
to conform, in the opinion of the Board of Directors of the Company, to any
modification of this Indenture contained in any such supplemental indenture may
be prepared and executed by the Company, authenticated by the Trustee or the
Authenticating Agent and delivered in exchange for the Debt Securities then
outstanding.
SECTION 9.05 EVIDENCE OF COMPLIANCE OF SUPPLEMENTAL INDENTURE TO BE
------------------------------------------------------
FURNISHED TO TRUSTEE.
- --------------------
The Trustee, subject to the provisions of Sections 6.01 and 6.02, shall,
in addition to the documents required by Section 14.06, receive an Officers'
Certificate as conclusive evidence that any supplemental indenture executed
pursuant hereto complies with the requirements of this Article IX. The Trustee
shall also receive an Opinion of Counsel as conclusive evidence that any
supplemental indenture executed pursuant to this Article IX is authorized or
permitted by, and conforms to, the terms of this Article IX and that it is
proper for the Trustee under the provisions of this Article IX to join in the
execution thereof.
ARTICLE X
REDEMPTION OF SECURITIES
SECTION 10.01 OPTIONAL REDEMPTION.
-------------------
The Company shall have the right to redeem the Debt Securities, in whole
or (provided that all accrued and unpaid interest has been paid on all Debt
Securities for all Interest Periods terminating on or prior to such date) from
time to time in part, on any Interest Payment Date on or after January 8, 2009
(each, an "Optional Redemption Date"), at the Optional Redemption Price.
SECTION 10.02 SPECIAL EVENT REDEMPTION.
------------------------
If a Special Event shall occur and be continuing, the Company shall have
the right to redeem the Debt Securities, in whole but not in part, at any time
within 90 days following the occurrence of such Special Event (the "Special
Redemption Date"), at the Special Redemption Price. In the event that the
Special Redemption Date falls on a day prior to the LIBOR Determination Date
for any Interest Period, then the Company shall be required to pay to
Securityholders, on the Business Day following such LIBOR Determination Date,
any additional amount of interest that would have been payable on the Special
Redemption Date had the amount of interest determined on such LIBOR
Determination Date been known on the first day of such Interest Period.
PAGE 48
SECTION 10.03 NOTICE OF REDEMPTION; SELECTION OF DEBT SECURITIES.
--------------------------------------------------
In case the Company shall desire to exercise the right to redeem all, or,
as the case may be, any part of the Debt Securities, it shall fix a date for
redemption and shall mail, or cause the Trustee to mail (at the expense of the
Company), a notice of such redemption at least 30 and not more than 60 days
prior to the date fixed for redemption to the holders of Debt Securities so to
be redeemed as a whole or in part at their last addresses as the same appear on
the Debt Security Register. Such mailing shall be by first class mail. The
notice if mailed in the manner herein provided shall be conclusively presumed
to have been duly given, whether or not the holder receives such notice. In
any case, failure to give such notice by mail or any defect in the notice to
the holder of any Debt Security designated for redemption as a whole or in part
shall not affect the validity of the proceedings for the redemption of any
other Debt Security.
Each such notice of redemption shall specify the CUSIP number, if any, of
the Debt Securities to be redeemed, the date fixed for redemption, the price
(or manner of calculation of the price) at which Debt Securities are to be
redeemed, the place or places of payment, that payment will be made upon
presentation and surrender of such Debt Securities, that interest accrued to
the date fixed for redemption will be paid as specified in said notice, and
that on and after said date interest thereon or on the portions thereof to be
redeemed will cease to accrue. If less than all the Debt Securities are to be
redeemed, the notice of redemption shall specify the numbers of the Debt
Securities to be redeemed. In case the Debt Securities are to be redeemed in
part only, the notice of redemption shall state the portion of the principal
amount thereof to be redeemed and shall state that on and after the date fixed
for redemption, upon surrender of such Debt Security, a new Debt Security or
Debt Securities in principal amount equal to the unredeemed portion thereof
will be issued.
Prior to 10:00 a.m., New York City time, on the Optional Redemption Date
or the Special Redemption Date specified in the notice of redemption given as
provided in this Section, the Company will deposit with the Trustee or with one
or more Paying Agents an amount of money sufficient to redeem on such date all
the Debt Securities so called for redemption at the applicable price therefor,
together with unpaid interest accrued to such date.
The Company will give the Trustee notice not less than 45 nor more than 75
days prior to the date fixed for redemption as to the price at which the Debt
Securities are to be redeemed and the aggregate principal amount of Debt
Securities to be redeemed and the Trustee shall select, in such manner as in
its sole discretion it shall deem appropriate and fair, the Debt Securities or
portions thereof (in integral multiples of $1,000) to be redeemed.
SECTION 10.04 PAYMENT OF DEBT SECURITIES CALLED FOR REDEMPTION.
------------------------------------------------
If notice of redemption has been given as provided in Section 10.03, the
Debt Securities or portions of Debt Securities with respect to which such
notice has been given shall become due and payable on the related Optional
Redemption Date or Special Redemption Date (as the case may be) and at the
place or places stated in such notice at the applicable price therefor,
together with unpaid interest accrued thereon to said Optional Redemption Date
or the Special Redemption Date (as the case may be), and on and after said
Optional Redemption Date or the Special Redemption Date (as the case may be)
(unless the Company shall default in the
PAGE 49
payment of such Debt Securities at the redemption price, together with unpaid
interest accrued thereon to said date) interest on the Debt Securities or
portions of Debt Securities so called for redemption shall cease to accrue. On
presentation and surrender of such Debt Securities at a place of payment
specified in said notice, such Debt Securities or the specified portions
thereof shall be paid and redeemed by the Company at the applicable price
therefor, together with unpaid interest accrued thereon to said Optional
Redemption Date or the Special Redemption Date (as the case may be).
Upon presentation of any Debt Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and make available for
delivery to the holder thereof, at the expense of the Company, a new Debt
Security or Debt Securities of authorized denominations in principal amount
equal to the unredeemed portion of the Debt Security so presented.
ARTICLE XI
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 11.01 COMPANY MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
-----------------------------------------------
Nothing contained in this Indenture or in the Debt Securities shall
prevent any consolidation or merger of the Company with or into any other
corporation or corporations (whether or not affiliated with the Company) or
successive consolidations or mergers in which the Company or its successor or
successors shall be a party or parties, or shall prevent any sale, conveyance,
transfer or other disposition of all or substantially all of the property of
the Company or its successor or successors to any other corporation (whether
or not affiliated with the Company or its successor or successors) authorized
to acquire and operate the same; PROVIDED, HOWEVER, that the Company hereby
covenants and agrees that (i) upon any such consolidation, merger (where the
Company is not the surviving corporation), sale, conveyance, transfer or other
disposition, the successor entity shall be a corporation organized and existing
under the laws of the United States or any state thereof or the District of
Columbia (unless such corporation has (1) agreed to make all payments due in
respect of the Debt Securities or, if outstanding, the Trust Securities and
the Capital Securities Guarantee without withholding or deduction for, or on
account of, any taxes, duties, assessments or other governmental charges under
the laws or regulations of the jurisdiction of organization or residence (for
tax purposes) of such corporation or any political subdivision or taxing
authority thereof or therein unless required by applicable law, in which case
such corporation shall have agreed to pay such additional amounts as shall be
required so that the net amounts received and retained by the holders of such
Debt Securities or Trust Securities, as the case may be, after payment of all
taxes (including withholding taxes), duties, assessments or other governmental
charges, will be equal to the amounts that such holders would have received and
retained had no such taxes (including withholding taxes), duties, assessments
or other governmental charges been imposed, (2) irrevocably and unconditionally
consented and submitted to the jurisdiction of any United States federal court
or New York state court, in each case located in the Borough of Manhattan, The
City of New York, in respect of any action, suit or proceeding against it
arising out of or in connection with this Indenture, the Debt Securities, the
Capital Securities Guarantee or the Declaration and irrevocably and
unconditionally waived, to the fullest extent permitted by law, any objection
to the laying of venue in any such court or that any such action, suit or
proceeding
PAGE 50
has been brought in an inconvenient forum and (3) irrevocably appointed an
agent in The City of New York for service of process in any action, suit or
proceeding referred to in clause (2) above) and such corporation expressly
assumes all of the obligations of the Company under the Debt Securities, this
Indenture, the Capital Securities Guarantee and the Declaration and (ii) after
giving effect to any such consolidation, merger, sale, conveyance, transfer or
other disposition, no Default or Event of Default shall have occurred and be
continuing.
SECTION 11.02 SUCCESSOR ENTITY TO BE SUBSTITUTED.
----------------------------------
In case of any such consolidation, merger, sale, conveyance, transfer or
other disposition contemplated in Section 11.01 and upon the assumption by the
successor corporation, by supplemental indenture, executed and delivered to
the Trustee and reasonably satisfactory in form to the Trustee, of the due and
punctual payment of the principal of and premium, if any, and interest on all
of the Debt Securities and the due and punctual performance and observance of
all of the covenants and conditions of this Indenture to be performed or
observed by the Company, such successor corporation shall succeed to and be
substituted for the Company, with the same effect as if it had been named
herein as the Company, and thereupon the predecessor entity shall be relieved
of any further liability or obligation hereunder or upon the Debt Securities.
Such successor corporation thereupon may cause to be signed, and may issue
either in its own name or in the name of the Company, any or all of the Debt
Securities issuable hereunder which theretofore shall not have been signed by
the Company and delivered to the Trustee or the Authenticating Agent; and, upon
the order of such successor corporation instead of the Company and subject to
all the terms, conditions and limitations in this Indenture prescribed, the
Trustee or the Authenticating Agent shall authenticate and deliver any Debt
Securities which previously shall have been signed and delivered by the
officers of the Company to the Trustee or the Authenticating Agent for
authentication, and any Debt Securities which such successor corporation
thereafter shall cause to be signed and delivered to the Trustee or the
Authenticating Agent for that purpose. All the Debt Securities so issued shall
in all respects have the same legal rank and benefit under this Indenture as
the Debt Securities theretofore or thereafter issued in accordance with the
terms of this Indenture as though all of such Debt Securities had been issued
at the date of the execution hereof.
SECTION 11.03 OPINION OF COUNSEL TO BE GIVEN TO TRUSTEE.
-----------------------------------------
The Trustee, subject to the provisions of Sections 6.01 and 6.02, shall
receive, in addition to the Opinion of Counsel required by Section 9.05, an
Opinion of Counsel as conclusive evidence that any consolidation, merger, sale,
conveyance, transfer or other disposition, and any assumption, permitted or
required by the terms of this Article XI complies with the provisions of this
Article XI.
ARTICLE XII
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 12.01 DISCHARGE OF INDENTURE.
----------------------
When (a) the Company shall deliver to the Trustee for cancellation all
Debt Securities theretofore authenticated (other than any Debt Securities
which shall have been
PAGE 51
destroyed, lost or stolen and which shall have been replaced or paid as
provided in Section 2.06) and not theretofore canceled, or (b) all the Debt
Securities not theretofore canceled or delivered to the Trustee for
cancellation shall have become due and payable, or are by their terms to become
due and payable within one year or are to be called for redemption within one
year under arrangements satisfactory to the Trustee for the giving of notice of
redemption, and the Company shall deposit with the Trustee, in trust, funds,
which shall be immediately due and payable, sufficient to pay at maturity or
upon redemption, as the case may be, all of the Debt Securities (other than any
Debt Securities which shall have been destroyed, lost or stolen and which shall
have been replaced or paid as provided in Section 2.06) not theretofore
canceled or delivered to the Trustee for cancellation, including principal and
premium, if any, and interest due or to become due to the Maturity Date, any
Optional Redemption Date or the Special Redemption Date, as the case may be,
but excluding, however, the amount of any moneys for the payment of principal
of and premium, if any, or interest on the Debt Securities (1) theretofore
repaid to the Company in accordance with the provisions of Section 12.04, or
(2) paid to any state or to the District of Columbia pursuant to its unclaimed
property or similar laws, and if in the case of either clause (a) or (b) above
the Company shall also pay or cause to be paid all other sums payable hereunder
by the Company, then this Indenture shall cease to be of further effect except
for the provisions of Sections 2.05, 2.06, 3.01, 3.02, 3.04, 6.06, 6.09 and
12.04 hereof, which shall survive until such Debt Securities shall mature or
are redeemed, as the case may be, and are paid in full. Thereafter, Sections
6.06, 6.09 and 12.04 shall survive, and the Trustee, on demand of the Company
accompanied by an Officers' Certificate and an Opinion of Counsel, each stating
that all conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with, and at the cost and
expense of the Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture, PROVIDED, HOWEVER, that the
Company hereby agrees to reimburse the Trustee for any costs or expenses
thereafter reasonably and properly incurred by the Trustee in connection with
this Indenture or the Debt Securities.
SECTION 12.02 DEPOSITED MONEYS TO BE HELD IN TRUST BY TRUSTEE.
-----------------------------------------------
Subject to the provisions of Section 12.04, all moneys deposited with the
Trustee pursuant to Section 12.01 shall be held in trust and applied by it to
the payment, either directly or through any Paying Agent (including the
Company if acting as its own Paying Agent), to the holders of the particular
Debt Securities for the payment of which such moneys have been deposited with
the Trustee, of all sums due and to become due thereon for principal, premium,
if any, and interest.
SECTION 12.03 PAYING AGENT TO REPAY MONEYS HELD.
---------------------------------
Upon the satisfaction and discharge of this Indenture, all moneys then
held by any Paying Agent of the Debt Securities (other than the Trustee)
shall, upon demand of the Company, be repaid to the Company or paid to the
Trustee, and thereupon such Paying Agent shall be released from all further
liability with respect to such moneys.
PAGE 52
SECTION 12.04 RETURN OF UNCLAIMED MONEYS.
--------------------------
Any moneys deposited with or paid to the Trustee or any Paying Agent for
payment of the principal of and premium, if any, or interest on Debt Securities
and not applied but remaining unclaimed by the holders of Debt Securities for
two years after the date upon which such principal, premium, if any, or
interest, as the case may be, shall have become due and payable, shall be
repaid to the Company by the Trustee or such Paying Agent on written demand;
and the holder of any of the Debt Securities shall thereafter look only to the
Company for any payment which such holder may be entitled to collect and all
liability of the Trustee or such Paying Agent with respect to such moneys shall
thereupon cease.
ARTICLE XIII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 13.01 INDENTURE AND DEBT SECURITIES SOLELY CORPORATE
----------------------------------------------
OBLIGATIONS.
- -----------
No recourse for the payment of the principal of or premium, if any, or
interest on any Debt Security, or for any claim based thereon or otherwise in
respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in this Indenture or in any supplemental indenture, or
in any such Debt Security, or because of the creation of any indebtedness
represented thereby, shall be had against any incorporator, stockholder,
officer, director, employee or agent, as such, past, present or future, of the
Company or of any predecessor or successor corporation of the Company, either
directly or through the Company or any successor corporation of the Company,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being expressly
understood that all such liability is hereby expressly waived and released as
a condition of, and as a consideration for, the execution of this Indenture and
the issuance of the Debt Securities.
ARTICLE XIV
MISCELLANEOUS PROVISIONS
SECTION 14.01 SUCCESSORS.
----------
All the covenants, stipulations, promises and agreements of the Company
contained in this Indenture shall bind its successors and assigns, whether so
expressed or not.
SECTION 14.02 OFFICIAL ACTS BY SUCCESSOR ENTITY.
---------------------------------
Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer of the
Company shall and may be done and performed with like force and effect by the
like board, committee, officer or other authorized Person of any entity that
shall at the time be the lawful successor of the Company.
PAGE 53
SECTION 14.03 SURRENDER OF COMPANY POWERS.
---------------------------
The Company, by instrument in writing executed by authority of 2/3 (two
thirds) of its Board of Directors and delivered to the Trustee, may surrender
any of the powers reserved to the Company and thereupon such power so
surrendered shall terminate both as to the Company and as to any permitted
successor.
SECTION 14.04 ADDRESSES FOR NOTICES, ETC.
--------------------------
Any notice or demand which by any provision of this Indenture is required
or permitted to be given or served by the Trustee or by the Securityholders on
the Company may be given or served in writing by being deposited postage
prepaid by registered or certified mail in a post office letter box addressed
(until another address is filed by the Company with the Trustee for such
purpose) to the Company at 1010 Manvel Avenue, Chandler, Oklahoma 76834,
Attention: R. Patrick Gilmore. Any notice, direction, request or demand by any
Securityholder or the Company to or upon the Trustee shall be deemed to have
been sufficiently given or made, for all purposes, if given or made in writing
at the office of Wilmington Trust Company at Rodney Square North, 1100 North
Market Street, Wilmington, DE 19890-0001, Attention: Corporate Trust
Administration.
SECTION 14.05 GOVERNING LAW.
-------------
This Indenture and the Debt Securities shall each be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to conflict of laws principles of said State other than Section 5-1401 of the
New York General Obligations Law.
SECTION 14.06 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
------------------------------------------------
Upon any application or demand by the Company to the Trustee to take any
action under any of the provisions of this Indenture, the Company shall furnish
to the Trustee an Officers' Certificate stating that in the opinion of the
signers all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with and an Opinion of
Counsel stating that, in the opinion of such counsel, all such conditions
precedent have been complied with (except that no such Opinion of Counsel is
required to be furnished to the Trustee in connection with the authentication
and issuance of Debt Securities).
Each certificate or opinion provided for in this Indenture and delivered
to the Trustee with respect to compliance with a condition or covenant provided
for in this Indenture (except certificates delivered pursuant to Section 3.05)
shall include (a) a statement that the person making such certificate or
opinion has read such covenant or condition and the definitions relating
thereto; (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 or her to express an informed opinion as to whether or not such
covenant or condition has been complied with; and (d) a statement as to whether
or not, in the opinion of such person, such condition or covenant has been
complied with.
PAGE 54
SECTION 14.07 BUSINESS DAY CONVENTION.
-----------------------
Notwithstanding anything to the contrary contained herein, if any Interest
Payment Date, other than the Maturity Date, any Optional Redemption Date or the
Special Redemption Date, falls on a day that is not a Business Day, then any
interest payable will be paid on, and such Interest Payment Date will be moved
to, the next succeeding Business Day, and additional interest will accrue for
each day that such payment is delayed as a result thereof. If the Maturity
Date, any Optional Redemption Date or the Special Redemption Date falls on a
day that is not a Business Day, then the principal, premium, if any, and/or
interest payable on such date will be paid on the next succeeding Business Day,
and no additional interest will accrue in respect of such payment made on such
next succeeding Business Day.
SECTION 14.08 TABLE OF CONTENTS, HEADINGS, ETC.
--------------------------------
The table of contents and the titles and headings of the Articles and
Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
SECTION 14.09 EXECUTION IN COUNTERPARTS.
-------------------------
This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one and the same instrument.
SECTION 14.10 SEPARABILITY.
------------
In case any one or more of the provisions contained in this Indenture or
in the Debt Securities shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Indenture or of such Debt
Securities, but this Indenture and such Debt Securities shall be construed as
if such invalid, illegal or unenforceable provision had never been contained
herein or therein.
SECTION 14.11 ASSIGNMENT.
----------
Subject to Article XI, the Company will have the right at all times to
assign any of its rights or obligations under this Indenture and the Debt
Securities to a direct or indirect wholly owned Subsidiary of the Company;
PROVIDED, HOWEVER, that, in the event of any such assignment, the Company
shall remain liable for all such obligations. Subject to the foregoing, this
Indenture is binding upon and inures to the benefit of the parties hereto and
their respective successors and assigns. This Indenture may not otherwise be
assigned by the parties thereto.
SECTION 14.12 ACKNOWLEDGMENT OF RIGHTS.
------------------------
The Company acknowledges that, with respect to any Debt Securities held
by the Trust or a trustee of the Trust, if such trustee of the Trust fails to
enforce its rights under this Indenture as the holder of Debt Securities held
as the assets of the Trust after the holders of a majority in aggregate
liquidation amount of the outstanding Capital Securities of the Trust have
PAGE 55
so directed in writing such trustee, a holder of record of such Capital
Securities may, to the fullest extent permitted by law, institute legal
proceedings directly against the Company to enforce such trustee's rights under
this Indenture without first instituting any legal proceedings against such
trustee or any other Person. Notwithstanding the foregoing, if an Event of
Default has occurred and is continuing and such event is attributable to the
failure of the Company to pay interest or premium, if any, on or principal of
the Debt Securities on the date such interest, premium, if any, or principal
is otherwise due and payable (or, in the case of redemption, on the related
Optional Redemption Date or the Special Redemption Date (as the case may be)),
the Company acknowledges that a holder of outstanding Capital Securities of the
Trust may directly institute a proceeding against the Company for enforcement
of payment to such holder directly of the principal of or premium, if any, or
interest on the Debt Securities having an aggregate principal amount equal to
the aggregate liquidation amount of the Capital Securities of such holder on
or after the respective due date (or Optional Redemption Date or Special
Redemption Date (as the case may be)) specified in the Debt Securities.
ARTICLE XV
SUBORDINATION OF DEBT SECURITIES
SECTION 15.01 AGREEMENT TO SUBORDINATE.
------------------------
The Company covenants and agrees, and each holder of Debt Securities
issued hereunder and under any supplemental indenture (the "Additional
Provisions") by such holder's acceptance thereof likewise covenants and agrees,
that all Debt Securities shall be issued subject to the provisions of this
Article XV; and each holder of a Debt Security, whether upon original issue or
upon transfer or assignment thereof, accepts and agrees to be bound by such
provisions.
The payment by the Company of the payments due on all Debt Securities
issued hereunder and under any Additional Provisions shall, to the extent and
in the manner hereinafter set forth, be subordinated and junior in right of
payment to the prior payment in full of all Senior Indebtedness of the Company,
whether outstanding at the date of this Indenture or thereafter incurred.
No provision of this Article XV shall prevent the occurrence of any
default or Event of Default hereunder.
SECTION 15.02 DEFAULT ON SENIOR INDEBTEDNESS.
------------------------------
In the event and during the continuation of any default by the Company in
the payment of principal, premium, interest or any other payment due in respect
of any Senior Indebtedness of the Company following any applicable grace
period, or in the event that the maturity of any Senior Indebtedness of the
Company has been accelerated because of a default, and such acceleration has
not been rescinded or canceled and such Senior Indebtedness has not been paid
in full, then, in either case, no payment shall be made by the Company with
respect to the payments due on the Debt Securities.
In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee when such payment is prohibited by the preceding
paragraph of this Section, such payment shall, subject to Section 15.06, be
held in trust for the benefit of, and shall be paid over
PAGE 56
or delivered to, the holders of Senior Indebtedness or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Senior Indebtedness may have been issued, as their respective
interests may appear, but only to the extent that the holders of the Senior
Indebtedness (or their representative or representatives or trustee) notify
the Trustee in writing within 90 days of such payment of the amounts then due
and owing on the Senior Indebtedness and only the amounts specified in such
notice to the Trustee shall be paid to the holders of Senior Indebtedness.
SECTION 15.03 LIQUIDATION; DISSOLUTION; BANKRUPTCY.
------------------------------------
Upon any payment by the Company or distribution of assets of the Company
of any kind or character, whether in cash, property or securities, to creditors
upon any dissolution, winding-up, liquidation or reorganization of the Company,
whether voluntary or involuntary or in bankruptcy, insolvency, receivership or
other proceedings, all amounts due upon all Senior Indebtedness of the Company
shall first be paid in full, or payment thereof provided for in money in
accordance with its terms, before any payment is made by the Company in respect
of the Debt Securities; and upon any such dissolution, winding-up, liquidation
or reorganization, any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
which the Securityholders or the Trustee would be entitled to receive from the
Company, except for the provisions of this Article XV, shall be paid by the
Company, or by any receiver, trustee in bankruptcy, liquidating trustee, agent
or other Person making such payment or distribution, or by the Securityholders
or by the Trustee under this Indenture if received by them or it, directly to
the holders of Senior Indebtedness of the Company (pro rata to such holders on
the basis of the respective amounts of Senior Indebtedness held by such
holders, as calculated by the Company) or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Senior Indebtedness may have been issued,
as their respective interests may appear, to the extent necessary to pay such
Senior Indebtedness in full, in money or money's worth, after giving effect to
any concurrent payment or distribution to or for the holders of such Senior
Indebtedness, before any payment or distribution is made to the Securityholders.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, prohibited by the foregoing shall be received by
the Trustee before all Senior Indebtedness of the Company is paid in full, or
provision is made for such payment in money in accordance with its terms, such
payment or distribution shall be held in trust for the benefit of, and shall be
paid over or delivered, to the holders of such Senior Indebtedness or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing such Senior Indebtedness
may have been issued, as their respective interests may appear, as calculated
by the Company, for application to the payment of all Senior Indebtedness of
the Company remaining unpaid to the extent necessary to pay such Senior
Indebtedness in full in money in accordance with its terms, after giving effect
to any concurrent payment or distribution to or for the benefit of the holders
of such Senior Indebtedness.
For purposes of this Article XV, the words "cash, property or securities"
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or
PAGE 57
readjustment, the payment of which is subordinated at least to the extent
provided in this Article XV with respect to the Debt Securities to the payment
of all Senior Indebtedness of the Company, that may at the time be outstanding,
PROVIDED, that (a) such Senior Indebtedness is assumed by the new corporation,
if any, resulting from any such reorganization or readjustment, and (b) the
rights of the holders of such Senior Indebtedness are not, without the consent
of such holders, altered by such reorganization or readjustment. The
consolidation of the Company with, or the merger of the Company into, another
corporation or the liquidation or dissolution of the Company following the
conveyance, transfer or other disposition of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article XI of this Indenture shall not be deemed a
dissolution, winding-up, liquidation or reorganization for the purposes of this
Section if such other corporation shall, as a part of such consolidation,
merger, conveyance or transfer, comply with the conditions stated in Article XI
of this Indenture. Nothing in Section 15.02 or in this Section shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 6.06 of
this Indenture.
SECTION 15.04 SUBROGATION.
-----------
Subject to the payment in full of all Senior Indebtedness of the Company,
the Securityholders shall be subrogated to the rights of the holders of such
Senior Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to such Senior Indebtedness until all
payments due in respect of the Debt Securities shall be paid in full; and, for
the purposes of such subrogation, no payments or distributions to the holders
of such Senior Indebtedness of any cash, property or securities to which the
Securityholders or the Trustee would be entitled except for the provisions of
this Article XV, and no payment over pursuant to the provisions of this Article
XV to or for the benefit of the holders of such Senior Indebtedness by
Securityholders or the Trustee, shall, as between the Company, its creditors
other than holders of Senior Indebtedness of the Company, and the holders of
the Debt Securities be deemed to be a payment or distribution by the Company
to or on account of such Senior Indebtedness. It is understood that the
provisions of this Article XV are, and are intended, solely for the purposes
of defining the relative rights of the holders of the Debt Securities, on the
one hand, and the holders of such Senior Indebtedness, on the other hand.
Nothing contained in this Article XV or elsewhere in this Indenture, any
Additional Provisions or in the Debt Securities is intended to or shall impair,
as between the Company, its creditors other than the holders of Senior
Indebtedness of the Company, and the holders of the Debt Securities, the
obligation of the Company, which is absolute and unconditional, to pay to the
holders of the Debt Securities all payments due in respect of the Debt
Securities as and when the same shall become due and payable in accordance
with their terms, or is intended to or shall affect the relative rights of
the holders of the Debt Securities and creditors of the Company other than
the holders of Senior Indebtedness of the Company, nor shall anything herein
or therein prevent the Trustee or the holder of any Debt Security from
exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article XV of
the holders of such Senior Indebtedness in respect of cash, property or
securities of the Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article XV, the Trustee, subject to the provisions of Article VI of this
Indenture, and the
PAGE 58
Securityholders shall be entitled to conclusively rely upon any order or decree
made by any court of competent jurisdiction in which such dissolution,
winding-up, liquidation or reorganization proceedings are pending, or a
certificate of the receiver, trustee in bankruptcy, liquidation trustee, agent
or other Person making such payment or distribution, delivered to the Trustee
or to the Securityholders, for the purposes of ascertaining the Persons
entitled to participate in such distribution, the holders of Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article XV.
SECTION 15.05 TRUSTEE TO EFFECTUATE SUBORDINATION.
-----------------------------------
Each Securityholder, by such Securityholder's acceptance thereof,
authorizes and directs the Trustee on such Securityholder's behalf to take such
action as may be necessary or appropriate to effectuate the subordination
provided in this Article XV and appoints the Trustee such Securityholder's
attorney-in-fact for any and all such purposes.
SECTION 15.06 NOTICE BY THE COMPANY.
---------------------
The Company shall give prompt written notice to a Responsible Officer of
the Trustee at the Principal Office of the Trustee of any fact known to the
Company that would prohibit the making of any payment of moneys to or by the
Trustee in respect of the Debt Securities pursuant to the provisions of this
Article XV. Notwithstanding the provisions of this Article XV or any other
provision of this Indenture or any Additional Provisions to the contrary, the
Trustee shall not be charged with knowledge of the existence of any facts that
would prohibit the making of any payment of moneys to or by the Trustee in
respect of the Debt Securities pursuant to the provisions of this Article XV
unless and until a Responsible Officer of the Trustee at the Principal Office
of the Trustee shall have received written notice thereof from the Company or
a holder or holders of Senior Indebtedness or from any trustee therefor; and
before the receipt of any such written notice, the Trustee, subject to the
provisions of Article VI of this Indenture, shall be entitled in all respects
to assume that no such facts exist; PROVIDED, HOWEVER, that if the Trustee
shall not have received the notice provided for in this Section at least two
Business Days prior to the date upon which by the terms hereof any money may
become payable for any purpose (including, without limitation, the payment of
the principal of or premium, if any, or interest on any Debt Security), then,
anything herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such money and to apply the same to
the purposes for which they were received, and shall not be affected by any
notice to the contrary that may be received by it within two Business Days
prior to such date.
The Trustee, subject to the provisions of Article VI of this Indenture,
shall be entitled to conclusively rely upon the delivery to it of a written
notice by a Person representing himself or herself to be a holder of Senior
Indebtedness of the Company (or a trustee or representative on behalf of such
holder) to establish that such notice has been given by a holder of such Senior
Indebtedness or a trustee or representative on behalf of any such holder or
holders. In the event that the Trustee determines in good faith that further
evidence is required with respect to the right of any Person as a holder of
such Senior Indebtedness to participate in any payment or distribution pursuant
to this Article XV, the Trustee may request such Person to furnish evidence to
the reasonable satisfaction of the Trustee as to the amount of such Senior
PAGE 59
Indebtedness held by such Person, the extent to which such Person is entitled
to participate in such payment or distribution and any other facts pertinent
to the rights of such Person under this Article XV, and, if such evidence is
not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment.
SECTION 15.07 RIGHTS OF THE TRUSTEE; HOLDERS OF SENIOR INDEBTEDNESS.
-----------------------------------------------------
The Trustee, in its individual capacity, shall be entitled to all the
rights set forth in this Article XV in respect of any Senior Indebtedness at
any time held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture or any Additional Provisions shall
deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness of the Company, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article XV, and no implied
covenants or obligations with respect to the holders of such Senior
Indebtedness shall be read into this Indenture or any Additional Provisions
against the Trustee. The Trustee shall not owe or be deemed to owe any
fiduciary duty to the holders of such Senior Indebtedness and, subject to the
provisions of Article VI of this Indenture, the Trustee shall not be liable
to any holder of such Senior Indebtedness if it shall pay over or deliver to
Securityholders, the Company or any other Person money or assets to which any
holder of such Senior Indebtedness shall be entitled by virtue of this Article
XV or otherwise.
Nothing in this Article XV shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 6.06.
SECTION 15.08 SUBORDINATION MAY NOT BE IMPAIRED.
---------------------------------
No right of any present or future holder of any Senior Indebtedness of the
Company to enforce the subordination of the Debt Securities provided in this
Article XV 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, provisions and covenants of this Indenture, regardless of any
knowledge thereof that any such holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Indebtedness of the Company may, at any time and from time to
time, without the consent of or notice to the Trustee or the Securityholders,
without incurring responsibility to the Securityholders and without impairing
or releasing the subordination of the Debt Securities provided in this Article
XV or the obligations hereunder of the holders of the Debt Securities to the
holders of such Senior Indebtedness, do any one or more of the following: (a)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, such Senior Indebtedness, or otherwise amend or supplement
in any manner such Senior Indebtedness or any instrument evidencing the same
or any agreement under which such Senior Indebtedness is outstanding; (b) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing such Senior Indebtedness; (c) release any Person liable in
any
PAGE 60
manner for the collection of such Senior Indebtedness; and (d) exercise or
refrain from exercising any rights against the Company or any other Person.
PAGE 61
Wilmington Trust Company, in its capacity as Trustee, hereby accepts the
trusts in this Indenture declared and provided, upon the terms and conditions
herein above set forth.
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PAGE 62
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed by their respective officers thereunto duly authorized, as of the
day and year first above written.
CHANDLER (U.S.A.), INC
By: /s/ Mark T. Paden
---------------------------------
Mark T. Paden
President
WILMINGTON TRUST COMPANY,
as Trustee
By: /s/ Denise M. Geran
---------------------------------
Denise M. Geran
Vice President
PAGE A-1
EXHIBIT A
FORM OF DEBT SECURITY
[FORM OF FACE OF SECURITY]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY OR ANY
INTEREST OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF, AS THE
CASE MAY BE, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY OR ANY
INTEREST OR PARTICIPATION HEREIN PRIOR TO THE DATE WHICH IS THE LATER OF (i)
TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER
THE SECURITIES ACT) AFTER THE LATER OF (Y) THE DATE OF ORIGINAL ISSUANCE HEREOF
AND (Z) THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE (AS DEFINED IN RULE
405 UNDER THE SECURITIES ACT) OF THE COMPANY WAS THE HOLDER OF THIS SECURITY OR
SUCH INTEREST OR PARTICIPATION (OR ANY PREDECESSOR THERETO) AND (ii) SUCH LATER
DATE, IF ANY, AS MAY BE REQUIRED BY ANY SUBSEQUENT CHANGE IN APPLICABLE LAW,
ONLY (A) TO THE COMPANY, (B) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A"), TO A PERSON THE HOLDER REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER", AS DEFINED IN RULE 144A, THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a) (1), (2), (3), (7)
OR (8) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY OR
SUCH INTEREST OR PARTICIPATION FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH
AN ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, (D) PURSUANT TO OFFERS AND SALES TO NON-US PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES PURSUANT TO REGULATION S UNDER THE SECURITIES ACT OR
(E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER PURSUANT TO CLAUSE (C) OR (E) ABOVE TO REQUIRE THE DELIVERY OF
AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
IT IN ACCORDANCE WITH THE
PAGE A-2
INDENTURE, A COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY. THE HOLDER OF
THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF
OR THEREOF, AS THE CASE MAY BE, AGREES THAT IT WILL COMPLY WITH THE FOREGOING
RESTRICTIONS.
THE HOLDER OF THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, BY
ITS ACCEPTANCE HEREOF OR THEREOF, AS THE CASE MAY BE, ALSO AGREES, REPRESENTS
AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT
OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") (EACH A "PLAN"), OR AN
ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY PLAN'S
INVESTMENT IN THE ENTITY AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN MAY
ACQUIRE OR HOLD THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, UNLESS
SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER
U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60,
91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND
HOLDING OF THIS SECURITY OR SUCH INTEREST OR PARTICIPATION IS NOT PROHIBITED
BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH
PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS SECURITY OR ANY INTEREST
OR PARTICIPATION HEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND
HOLDING HEREOF OR THEREOF, AS THE CASE MAY BE, THAT EITHER (i) IT IS NOT AN
EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO
WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING
ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY
USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE,
OR (ii) SUCH PURCHASE AND HOLDING WILL NOT RESULT IN A PROHIBITED TRANSACTION
UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH THERE IS NO
APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER OF THIS SECURITY WILL DELIVER
TO THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS
MAY BE REQUIRED BY THE INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE
FOREGOING RESTRICTIONS.
THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM
DENOMINATIONS OF $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY
ATTEMPTED TRANSFER OF THIS SECURITY IN DENOMINATIONS OF LESS THAN $100,000
SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH
PURPORTED TRANSFEREE
PAGE A-3
SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SECURITY OR ANY INTEREST OR
PARTICIPATION HEREIN FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE
RECEIPT OF DISTRIBUTIONS ON THIS SECURITY OR SUCH INTEREST OR PARTICIPATION,
AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER
IN THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN.
Floating Rate Junior Subordinated Debt Security due 2034
of
Chandler (U.S.A.), Inc.
Chandler (U.S.A.), Inc., an insurance holding company incorporated in
Oklahoma (the "Company", which term includes any successor permitted under the
Indenture (as defined herein)), for value received, promises to pay to
Wilmington Trust Company, not in its individual capacity but solely as
Institutional Trustee for Chandler Capital Trust II, a Delaware statutory
trust, or registered assigns, the principal amount of ________________________
Dollars ($_____________) on January 8, 2034 (the "Maturity Date") (or any
Optional Redemption Date or the Special Redemption Date, each as defined
herein, or any earlier date of acceleration of the maturity of this Debt
Security), and to pay interest on the outstanding principal amount of this
Debt Security from December 16, 2003, or from the most recent Interest Payment
Date (as defined below) to which interest has been paid or duly provided for,
quarterly (subject to deferral as set forth herein) in arrears on January 8th,
April 8th, July 8th and October 8th of each year, commencing on April 8, 2004
(each, an "Interest Payment Date"), at a floating rate per annum, which, with
respect to any Interest Period (as defined in the Indenture), will be equal to
LIBOR (as defined in the Indenture), as determined on the LIBOR Determination
Date (as defined in the Indenture) for such Interest Period, plus 4.10% (the
"Interest Rate") (PROVIDED that the Interest Rate for any Interest Period prior
to the Interest Period commencing on the Interest Payment Date in January 2009
may not exceed 12.5% per annum; and PROVIDED, FURTHER, that the Interest Rate
for any Interest Period may not exceed the highest rate permitted by New York
law, as the same may be modified by United States law of general application)
until the principal hereof shall have been paid or duly provided for, and on
any overdue principal and (without duplication and to the extent that payment
of such interest is enforceable under applicable law) on any overdue
installment of interest at an annual rate equal to the then applicable
Interest Rate, compounded quarterly. The amount of interest payable for any
Interest Period shall be computed on the basis of a 360-day year and the actual
number of days elapsed in such Interest Period.
The interest installment so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in the Indenture, be paid
to the Person in whose name this Debt Security (or one or more Predecessor
Securities, as defined in the Indenture) is registered at the close of business
on the "regular record date" for such interest installment, which shall be the
fifteenth day prior to such Interest Payment Date, whether or not such day is a
Business Day (as defined herein). Any such interest installment (other than
Deferred Interest (as defined herein)) not punctually paid or duly provided for
shall forthwith cease to be payable to the holders on such regular record date
and may be paid to the Person in whose name this Debt Security (or one or more
Predecessor Securities) is registered at the close of business on a special
record date to be fixed by the Trustee for the payment of such defaulted
interest, notice whereof
PAGE A-4
shall be given to the holders of the Debt Securities not less than 10 days
prior to such special record date, all as more fully provided in the Indenture.
Payment of the principal of and premium, if any, and interest on this Debt
Security due on the Maturity Date, any Optional Redemption Date or the Special
Redemption Date, as the case may be, shall be made in immediately available
funds against presentation and surrender of this Debt Security at the office
or agency of the Trustee maintained for that purpose in Wilmington, Delaware,
or at the office or agency of any other Paying Agent appointed by the Company
maintained for that purpose in Wilmington, Delaware or Chandler, Oklahoma.
Payment of interest on this Debt Security due on any Interest Payment Date
other than the Maturity Date, any Optional Redemption Date or the Special
Redemption Date, as the case may be, shall be made at the option of the Company
by check mailed to the holder thereof at such address as shall appear in the
Debt Security Register or by wire transfer of immediately available funds to an
account appropriately designated by the holder hereof. Notwithstanding the
foregoing, so long as the holder of this Debt Security is the Institutional
Trustee, payment of the principal of and premium, if any, and interest on this
Debt Security shall be made in immediately available funds when due at such
place and to such account as may be designated by the Institutional Trustee.
All payments in respect of this Debt Security shall be payable in any coin or
currency of the United States of America that at the time of payment is legal
tender for payment of public and private debts.
Notwithstanding anything to the contrary contained herein, if any Interest
Payment Date, other than the Maturity Date, any Optional Redemption Date or the
Special Redemption Date, falls on a day that is not a Business Day, then any
interest payable will be paid on, and such Interest Payment Date will be moved
to, the next succeeding Business Day, and additional interest will accrue for
each day that such payment is delayed as a result thereof. If the Maturity
Date, any Optional Redemption Date or the Special Redemption Date falls on a
day that is not a Business Day, then the principal, premium, if any, and/or
interest payable on such date will be paid on the next succeeding Business Day,
and no additional interest will accrue in respect of such payment made on such
next succeeding Business Day.
So long as no Event of Default has occurred and is continuing, the Company
shall have the right, from time to time and without causing an Event of Default,
to defer payments of interest on the Debt Securities by extending the interest
payment period on the Debt Securities at any time and from time to time during
the term of the Debt Securities, for up to 20 consecutive quarterly periods
(each such extended interest payment period, together with all previous and
further consecutive extensions thereof, is referred to herein as an "Extension
Period"). No Extension Period may end on a date other than an Interest Payment
Date or extend beyond the Maturity Date, any Optional Redemption Date or the
Special Redemption Date, as the case may be. During any Extension Period,
interest will continue to accrue on the Debt Securities, and interest on such
accrued interest (such accrued interest and interest thereon referred to herein
as "Deferred Interest") will accrue at an annual rate equal to the Interest
Rate applicable during such Extension Period, compounded quarterly from the
date such Deferred Interest would have been payable were it not for the
Extension Period, to the extent permitted by applicable law. No interest or
Deferred Interest (except any Additional Interest (as defined in the Indenture)
that may be due and payable) shall be due and payable during an Extension
Period, except at the end thereof. At the end of any Extension Period, the
Company shall pay all Deferred Interest then
PAGE A-5
accrued and unpaid on the Debt Securities; PROVIDED, HOWEVER, that during any
Extension Period, the Company may not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Company's capital stock or (ii) make any payment
of principal of or premium or interest on or repay, repurchase or redeem any
debt securities of the Company that rank in all respects PARI PASSU with or
junior in interest to the Debt Securities or (iii) make any payment under any
guarantees of the Company that rank, in all respects PARI PASSU with or junior
in respect to the Capital Securities Guarantee (other than (a) repurchases,
redemptions or other acquisitions of shares of capital stock of the Company
(A) in connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of one or more employees, officers,
directors or consultants, (B) in connection with a dividend reinvestment or
stockholder stock purchase plan or (C) in connection with the issuance of
capital stock of the Company (or securities convertible into or exercisable
for such capital stock), as consideration in an acquisition transaction
entered into prior to such Extension Period, (b) as a result of any exchange
or conversion of any class or series of the Company's capital stock (or any
capital stock of a subsidiary of the Company) for any class or series of the
Company's capital stock or of any class or series of the Company's indebtedness
for any class or series of the Company's capital stock, (c) the purchase of
fractional interests in shares of the Company's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged, (d) any declaration of a dividend in connection with
any stockholder's rights plan, or the issuance of rights, stock or other
property under any stockholder's rights plan, or the redemption or repurchase
of rights pursuant thereto or (e) any dividend in the form of stock, warrants,
options or other rights where the dividend stock or the stock issuable upon
exercise of such warrants, options or other rights is the same stock as that
on which the dividend is being paid or ranks PARI PASSU with or junior to such
stock). Prior to the termination of any Extension Period, the Company may
further extend such Extension Period, PROVIDED, that no Extension Period
(including all previous and further consecutive extensions that are part of
such Extension Period) shall exceed 20 consecutive quarterly periods. Upon the
termination of any Extension Period and upon the payment of all Deferred
Interest, the Company may commence a new Extension Period, subject to the
foregoing requirements. The Company must give the Trustee notice of its
election to begin or extend an Extension Period at least one Business Day prior
to the earlier of (i) the next succeeding date on which interest on the Debt
Securities would have been payable except for the election to begin or extend
such Extension Period or (ii) the date such interest is payable, but in any
event not later than the related regular record date.
The indebtedness evidenced by this Debt Security is, to the extent
provided in the Indenture, subordinate and junior in right of payment to the
prior payment in full of all Senior Indebtedness (as defined in the Indenture),
and this Debt Security is issued subject to the provisions of the Indenture
with respect thereto. Each holder of this Debt Security, by accepting the
same, (a) agrees to and shall be bound by such provisions, (b) authorizes and
directs the Trustee on such holder's behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination of
this Debt Security so provided and (c) appoints the Trustee such holder's
attorney-in-fact for any and all such purposes. Each holder of this Debt
Security, by such holder's acceptance hereof, hereby waives all notice of the
acceptance of the subordination provisions contained herein and in the
Indenture by each holder of Senior Indebtedness, whether now outstanding or
hereafter incurred, and waives reliance by each such holder upon said
provisions.
PAGE A-6
The Company waives diligence, presentment, demand for payment, notice of
nonpayment, notice of protest, and all other demands and notices.
This Debt Security shall not be entitled to any benefit under the
Indenture and shall not be valid or become obligatory for any purpose until
the certificate of authentication hereon shall have been signed by or on behalf
of the Trustee.
The provisions of this Debt Security are continued on the reverse side
hereof and such continued provisions shall for all purposes have the same
effect as though fully set forth at this place.
PAGE A-7
IN WITNESS WHEREOF, the Company has duly executed this certificate.
CHANDLER (U.S.A.), INC.
By:
---------------------------------
Name:
Title:
Dated: ______________________, ____
CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities referred to in the within-mentioned
Indenture.
WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as the Trustee
By:
---------------------------------
Authorized Officer
Dated: ______________________, ____
PAGE A-8
[FORM OF REVERSE OF SECURITY]
This Debt Security is one of a duly authorized series of debt securities
of the Company (collectively, the "Debt Securities"), all issued or to be
issued pursuant to an Indenture (the "Indenture"), dated as of December 16,
2003, duly executed and delivered between the Company and Wilmington Trust
Company, as Trustee (the "Trustee"), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Trustee, the Company and the holders of the Debt Securities of which this Debt
Security is a part.
Upon the occurrence and continuation of a Tax Event or an Investment
Company Event (each, a "Special Event"), the Company shall have the right to
redeem this Debt Security, at its option, in whole with all other Debt
Securities but not in part, at any time, within 90 days following the
occurrence of such Special Event (the "Special Redemption Date"), at the
Special Redemption Price (as defined herein). In the event that the Special
Redemption Date falls on a day prior to the LIBOR Determination Date for any
Interest Period, then the Company shall be required to pay to Securityholders,
on the Business Day following such LIBOR Determination Date, any additional
amount of interest that would have been payable on the Special Redemption Date
had the amount of interest determined on such LIBOR Determination Date been
known on the first day of such Interest Period.
The Company shall also have the right to redeem this Debt Security at its
option, in whole or (provided that all accrued and unpaid interest has been
paid on all Debt Securities for all Interest Periods terminating on or prior
to such date) from time to time in part, on any Interest Payment Date on or
after January 8, 2009 (each, an "Optional Redemption Date"), at the Optional
Redemption Price (as defined herein).
Any redemption pursuant to the preceding two paragraphs will be made upon
not less than 30 days' nor more than 60 days' prior written notice. If the
Debt Securities are only partially redeemed by the Company, the Debt Securities
will be redeemed pro rata or by any other method utilized by the Trustee. In
the event of redemption of this Debt Security in part only, a new Debt Security
or Debt Securities for the unredeemed portion hereof will be issued in the name
of the holder hereof upon the cancellation hereof.
"Optional Redemption Price" means an amount in cash equal to 100% of the
principal amount of this Debt Security being redeemed plus unpaid interest
accrued thereon to the related Optional Redemption Date.
"Special Redemption Price" means, with respect to the redemption of this
Debt Security following a Tax Event, an amount in cash equal to 104.75% of the
principal amount of Debt Securities to be redeemed prior to January 8, 2005 and
thereafter equal to the percentage for the outstanding principal amount of the
Debt Securities to be redeemed that is specified below for such Special
Redemption Date plus, in each case, unpaid interest accrued thereon to the
Special Redemption Date:
PAGE A-9
SPECIAL REDEMPTION DURING THE 12-MONTH
--------------------------------------
PERIOD BEGINNING JANUARY 8, PERCENTAGE OF PRINCIPAL AMOUNT
--------------------------- ------------------------------
2005 103.80 %
2006 102.85 %
2007 101.90 %
2008 100.95 %
2009 and thereafter 100.00 %
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Debt Securities may
be declared, and, in certain cases, shall IPSO FACTO become, due and payable,
and upon any such declaration of acceleration shall become due and payable, in
each case, in the manner, with the effect and subject to the conditions
provided in the Indenture.
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the holders of a majority in aggregate principal amount of
the Debt Securities at the time outstanding affected thereby, as specified in
the Indenture, to execute supplemental indentures for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Indenture or of any supplemental indenture or of modifying in any manner
the rights of the holders of the Debt Securities; PROVIDED, HOWEVER, that no
such supplemental indenture shall, among other things, without the consent of
the holders of each Debt Security then outstanding and affected thereby (i)
change the Maturity Date of any Debt Security, or reduce the principal amount
thereof or any premium thereon, or reduce the rate (or manner of calculation of
the rate) or extend the time of payment of interest thereon, or reduce (other
than as a result of the maturity or earlier redemption of any such Debt
Security in accordance with the terms of the Indenture and such Debt Security)
or increase the aggregate principal amount of Debt Securities then outstanding,
or change any of the redemption provisions, or make the principal thereof or
any interest or premium thereon payable in any coin or currency other than
United States Dollars, or impair or affect the right of any holder to institute
suit for payment thereof, or (ii) reduce the aforesaid percentage of Debt
Securities the holders of which are required to consent to any such
supplemental indenture. The Indenture also contains provisions permitting the
holders of a majority in aggregate principal amount of the Debt Securities at
the time outstanding, on behalf of the holders of all the Debt Securities, to
waive any past default in the performance of any of the covenants contained in
the Indenture, or established pursuant to the Indenture, and its consequences,
except (a) a default in payments due in respect of any of the Debt Securities,
(b) in respect of covenants or provisions of the Indenture which cannot be
modified or amended without the consent of the holder of each Debt Security
affected, or (c) in respect of the covenants of the Company relating to its
ownership of Common Securities of the Trust. Any such consent or waiver by
the holder of this Debt Security (unless revoked as provided in the Indenture)
shall be conclusive and binding upon such holder and upon all future holders
and owners of this Debt Security and of any Debt Security issued in exchange
PAGE A-10
herefor or in place hereof (whether by registration of transfer or otherwise),
irrespective of whether or not any notation of such consent or waiver is made
upon this Debt Security.
No reference herein to the Indenture and no provision of this Debt
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to make all payments due in
respect of this Debt Security at the time and place and at the rate and in the
money herein prescribed.
As provided in the Indenture and subject to certain limitations herein and
therein set forth, this Debt Security is transferable by the holder hereof on
the Debt Security Register (as defined in the Indenture) of the Company, upon
surrender of this Debt Security for registration of transfer at the office or
agency of the Trustee in Wilmington, Delaware, or at any other office or agency
of the Company in Wilmington, Delaware or Chandler, Oklahoma, accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Company or the Trustee duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Debt
Securities of authorized denominations and for the same aggregate principal
amount will be issued to the designated transferee or transferees. No service
charge will be made for any such registration of transfer, but the Company or
the Trustee may require payment of a sum sufficient to cover any tax, fee or
other governmental charge payable in relation thereto as specified in the
Indenture.
Prior to due presentment for registration of transfer of this Debt
Security, the Company, the Trustee, any Authenticating Agent, any Paying Agent,
any transfer agent and the Debt Security registrar may deem and treat the
holder hereof as the absolute owner hereof (whether or not this Debt Security
shall be overdue and notwithstanding any notice of ownership or writing hereon)
for the purpose of receiving payment of the principal of and premium, if any,
and interest on this Debt Security and for all other purposes, and none of the
Company, the Trustee, any Authenticating Agent, any Paying Agent, any transfer
agent or any Debt Security registrar shall be affected by any notice to the
contrary.
As provided in the Indenture and subject to certain limitations herein and
therein set forth, Debt Securities are exchangeable for a like aggregate
principal amount of Debt Securities of different authorized denominations, as
requested by the holder surrendering the same.
The Debt Securities are issuable only in registered certificated form
without coupons.
No recourse shall be had for the payment of the principal of or premium,
if any, or interest on this Debt Security, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Indenture,
against any incorporator, stockholder, officer, director, employee or agent,
past, present or future, as such, of the Company or of any predecessor or
successor corporation of the Company, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such liability being, by the acceptance hereof and as part of
the consideration for the issuance hereof, expressly waived and released.
PAGE A-11
All terms used but not defined in this Debt Security shall have the
meanings assigned to them in the Indenture.
THIS DEBT SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES OF SAID STATE OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW.
PAGE B-1
EXHIBIT B
FORM OF OFFICERS' CERTIFICATE
QUARTERLY FINANCIAL REPORT
TO: Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attention: Corporate Trust Administration
PLEASE COMPLETE FOR EACH INSURANCE SUBSIDIARY
Name of Insurance Company: _________________________________
Date of Report: ___________
Current A.M. Best Insurer's Financial Strength Rating: ___________
Please provide the following information for the most recent quarterly period
ended
Quarter: __ March 31 __ June 30 __ September 30 __ December 31 Year: 20____
Most Recently Reported NAIC Risk Based Capital Ratio _________ %
Total Policyholders' Surplus $________
Ratio of Consolidated Debt and Preferred Stock
to Total Policyholders' Surplus _________%
Total Admitted Assets $________
Ratio of NAIC Class 1 & 2 Rated Investments
to Total Fixed Income Investments _________%
Ratio of NAIC Class 1 & 2 Rated Investments to
Total Investments _________%
Return on Policyholders' Surplus for the Trailing Twelve Month Period _________%
For Property & Casualty Companies:
Expense Ratio _________%
PAGE B-2
Loss and LAE Ratio _________%
Combined Ratio _________%
Net Premiums Written (trailing twelve month period)
to Policyholders' Surplus _________%
PAGE B-3
CERTIFICATION
The undersigned hereby certifies that he/she has duly executed the
attached Quarterly Financial Report, dated ______, __, for and on behalf of
____________, that he/she is the _______________ of such Company, and that
he/she has authority to execute and file such instrument. The undersigned
further certifies that he/she is familiar with such instrument and that the
facts therein set forth are true to the best of his/her knowledge, information
and belief.
Name: _____________________________
PAGE B-4
LEGEND
NAIC RISK BASED CAPITAL RATIO-P&C (TOTAL ADJUSTED CAPITAL (AS DEFINED IN THE
NAIC RBC INSTRUCTIONS FOR P&C INSURERS)
/AUTHORIZED CONTROL LEVEL RISK-BASED
CAPITAL)
NAIC RISK BASED CAPITAL RATIO-LIFE (TOTAL ADJUSTED CAPITAL (AS DEFINED IN THE
NAIC RBC INSTRUCTIONS FOR LIFE INSURERS)
/AUTHORIZED CONTROL LEVEL RISK-BASED
CAPITAL)
TOTAL CAPITAL AND SURPLUS-LIFE COMMON CAPITAL STOCK + PREFERRED CAPITAL
STOCK + AGGREGATE WRITE-INS FOR OTHER THAN
SPECIAL SURPLUS FUNDS + SURPLUS NOTES +
GROSS PAID-IN AND CONTRIBUTED SURPLUS +
AGGREGATE WRITE-INS FOR SPECIAL SURPLUS
FUNDS + UNASSIGNED FUNDS (SURPLUS) + ASSET
VALUATION RESERVE - TREASURY STOCK
TOTAL CAPITAL AND SURPLUS-P&C AGGREGATE WRITE-INS FOR SPECIAL SURPLUS
FUNDS + COMMON CAPITAL STOCK + PREFERRED
CAPITAL STOCK + AGGREGATE WRITE-INS FOR
OTHER THAN SPECIAL SURPLUS FUNDS + SURPLUS
NOTES +GROSS PAID-IN AND CONTRIBUTED
SURPLUS + UNASSIGNED FUNDS (SURPLUS) -
TREASURY STOCK
TOTAL ADMITTED ASSETS TOTAL ADMITTED ASSETS AS DETERMINED IN
ACCORDANCE WITH STATUTORY ACCOUNTING
PRINCIPLES
RETURN ON POLICYHOLDERS' SURPLUS NET INCOME/POLICYHOLDERS' SURPLUS FOR THE
FOR THE TRAILING TWELVE MONTH TRAILING TWELVE MONTH PERIOD
PERIOD
EXPENSE RATIO OTHER UNDERWRITING EXPENSES INCURRED/NET
PREMIUMS EARNED
LOSS AND LAE RATIO (LOSSES INCURRED + LOSS EXPENSES
INCURRED)/NET PREMIUMS EARNED
COMBINED RATIO EXPENSE RATIO + LOSS AND LAE RATIO
NET PREMIUMS WRITTEN (TRAILING NET PREMIUMS WRITTEN OF THE TRAILING TWELVE
TWELVE MONTH PERIOD) TO MONTH PERIOD/POLICYHOLDERS' SURPLUS
POLICYHOLDERS' SURPLUS