EXHIBIT 4.01
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SUBORDINATED INDENTURE
Between
EXODUS COMMUNICATIONS, INC.
and
HSBC BANK USA, AS TRUSTEE
Dated as of February 9, 2001
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TABLE SHOWING REFLECTION IN THIS SUBORDINATED INDENTURE OF
CERTAIN PROVISIONS OF THE TRUST INDENTURE ACT OF 1939*
Section of Section of
Act Indenture
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310(a)(1) ................................................... 7.08
310(a)(2) ................................................... 7.08
310(a)(3) ................................................... Inapplicable
310(a)(4) ................................................... Inapplicable
310(a)(5) ................................................... 7.08
310(b) ................................................... 7.07
310(c) ................................................... Inapplicable
311(a) ................................................... 7.12
311(b) ................................................... 7.12
311(c) ................................................... Inapplicable
312(a) ................................................... 5.01, 5.02(a)
312(b) ................................................... 5.02(b)
312(c) ................................................... 5.02(c)
313(a) ................................................... 5.04(a)
313(b)(1) ................................................... Inapplicable
313(b)(2) ................................................... Inapplicable
313(c) ................................................... 5.04(b)
313(d) ................................................... 5.04(b)
314(a)(1) ................................................... 5.03(a)
314(a)(2) ................................................... 5.03(b)
314(a)(3) ................................................... 5.03(c)
314(a)(4) ................................................... 5.03(d)
314(b) ................................................... Inapplicable
314(c) ................................................... 13.03
314(d) ................................................... Inapplicable
314(e) ................................................... 13.03
314(f) ................................................... Omitted
315(a) ................................................... 7.01
315(b) ................................................... 6.10
315(c) ................................................... 7.01
315(d) ................................................... 7.01
315(e) ................................................... 6.11
316(a)(1) ................................................... 6.09
316(a)(2) ................................................... Omitted
316(b) ................................................... 6.06
316(c) ................................................... 6.09
317(a) ................................................... 6.02, 6.03
317(b) ................................................... 4.05
318(a) ................................................... 13.05
___________________
* This Table is not part of the Subordinated Indenture.
TABLE OF CONTENTS
Page
ARTICLE ONE DEFINITIONS.................................................... 1
SECTION 1.01. Certain Terms Defined................................... 1
"Act"............................................................. 2
"Affiliate"....................................................... 2
"Agent"........................................................... 2
"Authenticating Agent"............................................ 2
"Authorized Newspaper"............................................ 2
"Board of Directors".............................................. 2
"Board Resolution"................................................ 2
"Business Day".................................................... 2
"Commission"...................................................... 2
"Company"......................................................... 3
"Company Order"................................................... 3
"Corporate Trust Office".......................................... 3
"Coupon".......................................................... 3
"covenant defeasance"............................................. 3
"Defaulted Interest".............................................. 3
"Depository"...................................................... 3
"ECU"............................................................. 3
"Euro" or "euro".................................................. 3
"Event of Default"................................................ 3
"Exchange Act".................................................... 4
"Expiration Date"................................................. 4
"Foreign Currency"................................................ 4
"Holder," "Holder of Subordinated Securities," "Subordinated
Securityholder"................................................ 4
"Interest Payment Date"........................................... 4
"IRS"............................................................. 4
"Judgment Currency"............................................... 4
"Local Business Day".............................................. 4
"Officers' Certificate"........................................... 4
"Opinion of Counsel".............................................. 4
"Original Issue Date"............................................. 4
"Original Issue Discount Subordinated Security"................... 4
"Outstanding"..................................................... 5
"Paying Agent".................................................... 6
"Periodic Offering"............................................... 6
"Person".......................................................... 6
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TABLE OF CONTENTS
(continued)
"Predecessor Subordinated Security"................................................................. 6
"principal"......................................................................................... 6
"Record Date"....................................................................................... 6
"Register".......................................................................................... 6
"Registered Global Subordinated Security"........................................................... 6
"Registered Subordinated Security".................................................................. 6
"Required Currency"................................................................................. 6
"Responsible Officer"............................................................................... 6
"Senior Indebtedness................................................................................ 7
"Special Record Date"............................................................................... 7
"Stated Maturity"................................................................................... 7
"Subordinated Indenture"............................................................................ 7
"Subordinated Security" or "Subordinated Securities"................................................ 7
"Supplemental Subordinated Indenture"............................................................... 7
"tranche"........................................................................................... 7
"Trust Indenture Act"............................................................................... 7
"Trustee"........................................................................................... 7
"United States Dollars"............................................................................. 8
"Unregistered Subordinated Security"................................................................ 8
"U.S. Government Obligations"....................................................................... 8
"Yield to Maturity"................................................................................. 8
ARTICLE TWO ISSUE, DESCRIPTION, EXECUTION, REGISTRATION, TRANSFER AND EXCHANGE OF SUBORDINATED SECURITIES.... 8
SECTION 2.01. Form Of Subordinated Securities and Trustee's Certificate Of Authentication............... 8
SECTION 2.02. Form of Trustee's Certificate of Authentication........................................... 9
SECTION 2.03. Amount Unlimited, Issuable in Series...................................................... 9
SECTION 2.04. Execution of Subordinated Securities...................................................... 12
SECTION 2.05. Authentication and Delivery of Subordinated Indentures.................................... 12
SECTION 2.06. Certificate of Authentication............................................................. 14
SECTION 2.07. Denominations; Payment of Interest on Subordinated Securities............................. 15
SECTION 2.08. Registration, Transfer and Exchange of Subordinated Securities............................ 16
SECTION 2.09. Mutilated, Defaced, Destroyed, Lost and Stolen Subordinated Securities.................... 18
SECTION 2.10. Cancellation and Destruction of Surrendered Subordinated Securities....................... 19
SECTION 2.11. Temporary Subordinated Securities......................................................... 20
SECTION 2.12. Subordinated Securities in Global Form; Depositories...................................... 20
SECTION 2.13. CUSIP Numbers............................................................................. 23
SECTION 2.14. Series May Include Tranches............................................................... 23
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TABLE OF CONTENTS
(continued)
ARTICLE THREE REDEMPTION OF SUBORDINATED SECURITIES AND SINKING FUNDS.................................................. 24
SECTION 3.01. Applicability of Article......................................................................... 24
SECTION 3.02. Notice of Redemption; Partial Redemptions........................................................ 24
SECTION 3.03. Payment of Subordinated Securities Called for Redemption......................................... 25
SECTION 3.04. Exclusion of Certain Subordinated Securities From Eligibility for Selection for Redemption....... 26
SECTION 3.05. Mandatory and Optional Sinking Funds............................................................. 26
ARTICLE FOUR PARTICULAR COVENANTS OF THE COMPANY...................................................................... 29
SECTION 4.01. Payment of Principal of and Interest on Subordinated Securities.................................. 29
SECTION 4.02. Corporate Existence of the Company; Consolidation, Merger, Sale or Transfer...................... 29
SECTION 4.03. Maintenance of Offices or Agencies for Transfer, Registration, Exchange and Payment of Subordinated
Securities............................................................................................... 29
SECTION 4.04. Appointment to Fill a Vacancy in the Office of Trustee........................................... 30
SECTION 4.05. Duties of Paying Agent........................................................................... 30
SECTION 4.06. Notice of Default................................................................................ 32
SECTION 4.07. Maintenance of Properties........................................................................ 32
SECTION 4.08. Payment of Taxes and Other Claims................................................................ 32
SECTION 4.09. Luxembourg Publications.......................................................................... 32
ARTICLE FIVE SUBORDINATED SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE........................... 33
SECTION 5.01. Company to Furnish Trustee Information as to the Names and Addresses of Subordinated
Securityholders.......................................................................................... 33
SECTION 5.02. Preservation of Information; Communication to Subordinated Securityholders....................... 33
SECTION 5.03. Reports by Company............................................................................... 34
SECTION 5.04. Reports by Trustee............................................................................... 35
ARTICLE SIX REMEDIES OF THE TRUSTEE AND SUBORDINATED SECURITYHOLDERS ON EVENT OF DEFAULT............................. 35
SECTION 6.01. Events of Default; Acceleration, Waiver of Default And Restoration of Position and Rights........ 35
SECTION 6.02. Covenant of Company to Pay to Trustee Whole Amount Due on Subordinated Securities on Default in
Payment of Interest or Principal......................................................................... 38
SECTION 6.03. Trustee May File Proofs of Claim................................................................. 39
SECTION 6.04. Trustee May Enforce Claims Without Possession of Subordinated Securities......................... 40
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TABLE OF CONTENTS
(continued)
SECTION 6.05. Application of Moneys Collected by Trustee......................................................... 40
SECTION 6.06. Limitation on Suits by Holders of Subordinated Security............................................ 41
SECTION 6.07. Rights and Remedies Cumulative..................................................................... 42
SECTION 6.08. Delay or Omission Not Waiver....................................................................... 42
SECTION 6.09. Control by Holders; Waiver of Past Defaults........................................................ 42
SECTION 6.10. Trustee to Give Notice of Defaults Known to it, But May Withhold in Certain Circumstances.......... 43
SECTION 6.11. Requirement of an Undertaking to Pay Costs in Certain Suits Under the Subordinated Indenture or
Against the Trustee.......................................................................................... 44
SECTION 6.12. Waiver of Stay, or Extension Laws.................................................................. 44
ARTICLE SEVEN CONCERNING THE TRUSTEE....................................................................................... 44
SECTION 7.01. Certain Duties and Responsibilities of Trustee..................................................... 44
SECTION 7.02. Certain Rights of Trustee.......................................................................... 45
SECTION 7.03. Trustee Not Responsible for Recitals or Application of Proceeds.................................... 46
SECTION 7.04. Trustee May Own Subordinated Securities or Coupons................................................. 47
SECTION 7.05. Moneys Received by Trustee to be Held in Trust..................................................... 47
SECTION 7.06. Trustee Entitled to Compensation, Reimbursement and Indemnity...................................... 47
SECTION 7.07. Disqualification; Conflicting Interest............................................................. 47
SECTION 7.08. Requirements for Eligibility of Trustee............................................................ 47
SECTION 7.09. Resignation and Removal of Trustee; Appointment of Successor....................................... 48
SECTION 7.10. Acceptance of Appointment by Successor Trustee..................................................... 49
SECTION 7.11. Successor to Trustee by Merger, Consolidation or Succession to Business............................ 50
SECTION 7.12. Preferential Collection of Claims Against Company.................................................. 51
SECTION 7.13. Appointment of Authenticating Agent................................................................ 51
ARTICLE EIGHT CONCERNING THE SUBORDINATED SECURITYHOLDERS.................................................................. 53
SECTION 8.01. Evidence of Action by Subordinated Securityholders................................................. 53
SECTION 8.02. Proof of Execution of Instruments and of Holding of Subordinated Securities........................ 53
SECTION 8.03. Who May be Deemed Owners of Subordinated Securities................................................ 53
SECTION 8.04. Subordinated Securities Owned by the Company or Controlled or Controlling Persons Disregarded for
Certain Purposes......................................................................................... 54
SECTION 8.05. Instruments Executed by Subordinated Securityholders Bind Future Holders........................... 55
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TABLE OF CONTENTS
(continued)
ARTICLE NINE SUBORDINATED SECURITYHOLDERS' MEETINGS................................................................. 55
SECTION 9.01. Purposes for Which Meetings May be Called............................................ 55
SECTION 9.02. Manner of Calling Meetings........................................................... 56
SECTION 9.03. Call of Meeting by the Company or Subordinated Securityholders....................... 56
SECTION 9.04. Who May Attend and Vote at Meetings.................................................. 56
SECTION 9.05. Regulations May be Made by Trustee; Conduct of the Meeting; Voting Rights;
Adjournment.................................................................................. 56
SECTION 9.06. Manner of Voting at Meetings and Record to be Kept................................... 57
SECTION 9.07. Exercise of Rights of Trustee and Subordinated Securityholders Not to be Hindered
or Delayed................................................................................... 58
ARTICLE TEN SUPPLEMENTAL SUBORDINATED INDENTURES................................................................... 58
SECTION 10.01. Purposes for Which Supplemental Subordinated Indentures May be Entered into
Without Consent of Subordinated Securityholders.............................................. 58
SECTION 10.02. Modification of Subordinated Indenture With Consent of Holders of Subordinated
Securities................................................................................... 59
SECTION 10.03. Effect of Supplemental Subordinated Indentures...................................... 60
SECTION 10.04. Subordinated Securities May Bear Notation of Changes by Supplemental Subordinated
Indentures................................................................................... 61
ARTICLE ELEVEN DISCHARGE; DEFEASANCE................................................................................. 61
SECTION 11.01. Satisfaction and Discharge of Subordinated Indenture................................ 61
SECTION 11.02. Application by Trustee of Funds Deposited for Payment of Subordinated Securities.... 65
SECTION 11.03. Repayment of Moneys Held by Paying Agent............................................ 65
SECTION 11.04. Return of Moneys Held by Trustee and Paying Agent Unclaimed for Two Years........... 65
SECTION 11.05. Indemnity for U.S. Government of Obligations........................................ 66
ARTICLE TWELVE IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS....................................... 66
SECTION 12.01. Incorporators, Stockholders, Officers and Directors of Company Exempt from
Individual Liability......................................................................... 66
ARTICLE THIRTEEN MISCELLANEOUS PROVISIONS............................................................................ 66
SECTION 13.01. Successors and Assigns of the Company Bound by Subordinated Indenture............... 66
SECTION 13.02. Notices; Effectiveness.............................................................. 66
SECTION 13.03. Compliance Certificates and Opinions................................................ 68
SECTION 13.04. Days on Which Payment to be Made, Notice Given or Other Action Taken................ 68
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TABLE OF CONTENTS
(continued)
SECTION 13.05. Provisions Required by Trust Indenture Act to Control....................................... 69
SECTION 13.06. Governing Law............................................................................... 69
SECTION 13.07. Effect of Headings.......................................................................... 69
SECTION 13.08. Subordinated Securities in a Foreign Currency or in ECU..................................... 69
SECTION 13.09. Judgment Currency........................................................................... 70
SECTION 13.10. Provisions of the Subordinated Indenture and Subordinated Securities for the Sole Benefit
of the Parties and the Subordinated Securityholders............................................... 70
SECTION 13.11. Acts of Holders; Record Dates............................................................... 70
SECTION 13.12. Notices and Demands on Holders of Subordinated Securities and Coupons....................... 72
SECTION 13.13. Separability................................................................................ 73
SECTION 13.14. Subordinated Indenture May be Executed in Counterparts...................................... 73
ARTICLE FOURTEEN SUBORDINATION OF SECURITIES......................................................................... 73
SECTION 14.01. Securities Subordinated to Senior Indebtedness.............................................. 73
SECTION 14.02. Subrogation................................................................................. 74
SECTION 14.03. Obligation of the Company Unconditional..................................................... 75
SECTION 14.04. Payments on Subordinated Securities Permitted............................................... 75
SECTION 14.05. Effectuation of Subordinated by Trustee..................................................... 75
SECTION 14.06. Knowledge of Trustee........................................................................ 76
SECTION 14.07. Trustee May Hold Senior Indebtedness........................................................ 76
SECTION 14.08. Rights of Holders of Senior Indebtedness Not Impaired....................................... 76
vi
THIS SUBORDINATED INDENTURE, dated as of February 9, 2001, between EXODUS
COMMUNICATIONS, INC., a Delaware corporation (the "Company"), and HSBC BANK USA,
a banking corporation and trust company duly organized and existing under the
laws of the State of New York, as trustee (the "Trustee").
WITNESSETH:
WHEREAS, the Company has duly authorized the issuance, sale, execution and
delivery, from time to time, of its unsecured evidences of subordinated
indebtedness (hereinafter referred to as the "Subordinated Securities"), without
limit as to principal amount, issuable in one or more series, the amount and
terms of each such series to be determined as hereinafter provided; and, to
provide the terms and conditions upon which the Subordinated Securities are to
be issued, authenticated and delivered, the Company has duly authorized the
execution and delivery of this Subordinated Indenture; and
WHEREAS, all acts and things necessary to make the Subordinated Securities,
when executed by the Company and authenticated and delivered by the Trustee as
in this Subordinated Indenture provided, the valid, binding and legal
subordinated obligations of the Company, and to constitute this Subordinated
Indenture a valid indenture and agreement according to its terms, have been done
and performed, and the execution of this Subordinated Indenture and the issuance
hereunder of the Subordinated Securities have in all respects been duly
authorized;
NOW, THEREFORE, THIS SUBORDINATED INDENTURE
WITNESSETH:
That in order to declare the terms and conditions upon which the
Subordinated Securities are to be issued, authenticated and delivered, and in
consideration of the premises and of the purchase and acceptance of the
Subordinated 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 Subordinated Securities or of any series
thereof, as follows:
ARTICLE ONE
DEFINITIONS
SECTION 1.01. Certain Terms Defined. For all purposes of this
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Subordinated Indenture, except as otherwise expressly provided or unless the
context otherwise requires:
(a) the terms defined in this Article One have the meanings assigned
to them in this Article One, and include the plural as well as the singular;
(b) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(c) all accounting terms not otherwise defined herein shall have the
meanings assigned to them, and all computations herein provided for shall be
made, in accordance with generally accepted accounting principles in the United
States of America, and the term
"generally accepted accounting principles" shall mean such principles as they
exist at the date of applicability thereof; and
(d) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Subordinated Indenture as a whole and not to any
particular Article, Section or other subdivision.
"Act" of the Holders shall have the meaning set forth in Section 13.11.
"Affiliate" of any Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with") when used with respect to any Person means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities, by contract or otherwise.
"Agent" means any registrar, Paying Agent, transfer agent or Authenticating
Agent.
"Authenticating Agent" shall the meaning set forth in Section 7.13.
"Authorized Newspaper" means a newspaper (which, in the case of The City of
New York, will, if practicable, be The Wall Street Journal (Eastern Edition) and
in the case of London, will, if practicable, be the Financial Times (London
Edition) and, in the case of Luxembourg, will, if practicable be the Luxembourg
Wort), published in an official language of the country of publication,
customarily published at least once a day for at least five days in each
calendar week and of general circulation in The City of New York, London or
Luxembourg, as applicable. If it shall be impractical in the opinion of the
Trustee to make any publication of any notice required hereby in an Authorized
Newspaper, any publication or other notice in lieu thereof which is made or
given with the approval of the Trustee shall constitute a sufficient publication
of such notice.
"Board of Directors" means the board of directors of the Company, or any
duly authorized committee of such board of directors.
"Board Resolution" means one or more resolutions of the Board of Directors
certified by the Secretary or by an Assistant Secretary of the Company to have
been duly adopted by the Board of Directors of the Company and to be in full
force and effect on the date of such certification and delivered to the Trustee.
"Business Day" means, with respect to any Subordinated Security, any day
other than a Saturday or Sunday or a day on which banks and trust companies in
the municipality (or in any of the municipalities, if more than one) in which
amounts are payable, as specified in the form of such Subordinated Security, are
authorized or required by any applicable law, executive order or regulation to
remain closed.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or if at any time after the
execution of this
2
Subordinated Indenture such Commission is not existing and performing the duties
theretofore assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Company" means Exodus Communications, Inc., a Delaware corporation, until
a successor corporation shall have become such pursuant to the applicable
provisions hereof, and thereafter "Company" shall mean such successor Company.
"Company Order" means a written statement, request or order of the Company
signed in its name by the Chairman of the Board of Directors, the President or
Chief Executive Officer or any Vice President, and by the Treasurer, or an
Assistant Treasurer, or the Controller, or an Assistant Controller, or the
Secretary or an Assistant Secretary of the Company and delivered to the Trustee.
"Corporate Trust Office" means the corporate trust office of the Trustee of
a series of Subordinated Securities at which at any particular time its
corporate trust business shall be administered, which office on the date of
execution of this Subordinated Indenture is located at ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, except that with respect to presentation of Subordinated
Securities of a series for payment or for registration of transfer or exchange
such term shall mean the office or agency of the Trustee of such series
designated for such purpose, which office or agency on the date of execution of
this Subordinated Indenture is located at ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇.
"Coupon" means any interest coupon appertaining to an Unregistered
Subordinated Security.
"covenant defeasance" shall have the meaning set forth in Section 11.01(C).
"Defaulted Interest" shall have the meaning set forth in Section 2.07.
"Depository" means, with respect to the Subordinated Securities of any
series issuable or issued in whole or in part in the form of one or more
Registered Global Subordinated Securities, the Person designated as depository
by the Company pursuant to Section 2.03 of this Subordinated Indenture until a
successor depository shall have become such pursuant to the applicable
provisions of this Subordinated Indenture, and thereafter the term "Depository"
shall mean or include each Person who is then a depository hereunder, and if at
any time there is more than one such Person, "Depository" as used with respect
to the Subordinated Securities of any such series shall mean the Depository with
respect to the Subordinated Securities of that series.
"ECU" means the European Currency Unit as defined and revised from time to
time by the European Monetary System of the European Community and/or Euros.
"Euro" or "euro" means the currency adopted by those countries
participating in the third stage of the European Monetary Union.
"Event of Default," with respect to Subordinated Securities of any series,
means any event specified as such in Section 6.01 and any other event as may be
established with respect to the Subordinated Securities of such series as
permitted by Section 2.03. An Event of Default shall "exist" if an Event of
Default shall have occurred and be continuing.
3
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Expiration Date" shall have the meaning set forth in Section 13.11.
"Foreign Currency" means a currency issued by the government of a country
other than the United States of America.
"Holder," "Holder of Subordinated Securities," "Subordinated
Securityholder" or any other similar term means (a) in the case of any
Registered Subordinated Security, the person in whose name such Subordinated
Security is registered in the Register kept by the Company for that purpose in
accordance with the terms hereof, and (b) in the case of any Unregistered
Subordinated Security, the bearer of such Subordinated Security, or any Coupon
appertaining thereto, as the case may be.
"Interest Payment Date," when used with respect to any Subordinated
Security, means the Stated Maturity of an installment of interest on such
Subordinated Security.
"IRS" means the Internal Revenue Service of the United States Department of
the Treasury, or any successor entity.
"Judgment Currency" shall have the meaning set forth in Section 13.09.
"Local Business Day" shall have the meaning set forth in Section 13.02(a).
"Officers' Certificate" means a certificate signed by the Chairman of the
Board of Directors, any Vice-Chairman of the Board of Directors, the President
or Chief Executive Officer or any Vice-President and by the Treasurer, any
Assistant Treasurer, the Secretary or any Assistant Secretary of the Company and
delivered to the Trustee. Each such certificate shall comply with the
requirements of Section 314(c) of the Trust Indenture Act and Section 13.03 of
this Subordinated Indenture.
"Opinion of Counsel" means a written opinion of legal counsel, who may be
an employee of the Company and who shall be acceptable to the Trustee. Each
such opinion shall comply with the requirements of Section 314(c) of the Trust
Indenture Act and Section 13.03 of this Subordinated Indenture.
"Original Issue Date" of any Subordinated Security (or portion thereof)
means the earlier of (a) the date of such Subordinated Security or (b) the date
of any Subordinated Security (or portion thereof) for which such Subordinated
Security was issued (directly or indirectly) on registration of transfer,
exchange or substitution.
"Original Issue Discount Subordinated Security" means (a) any Subordinated
Security which provides for an amount less than the principal amount thereof to
be due and payable upon declaration of acceleration of the maturity thereof
pursuant to Section 6.01 or (b) any other Subordinated Security which for United
States Federal income tax purposes would be considered an original issue
discount security.
4
"Outstanding," when used with reference to Subordinated Securities, subject
to the provisions of Section 8.04, means, as of the date of determination, all
Subordinated Securities theretofore authenticated and delivered under this
Subordinated Indenture, except:
(a) Subordinated Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(b) Subordinated Securities, or portions thereof, for whose payment or
redemption moneys or U.S. Government Obligations (as provided in Section 11.01)
in the necessary amount have been theretofore deposited with the Trustee or with
any Paying Agent (other than the Company) or shall have been set aside,
segregated and held in trust by the Company (if the Company shall act as its own
Paying Agent) in trust for the Holders of such Subordinated Securities, provided
that if such Subordinated Securities or portions thereof are to be redeemed
prior to the Stated Maturity thereof, notice of such redemption has been duly
given as provided in Article Three hereof, or provision therefor satisfactory to
the Trustee has been made;
(c) Subordinated Securities in exchange for or in lieu of which other
Subordinated Securities shall have been authenticated and delivered under this
Subordinated Indenture; and
(d) Subordinated Securities alleged to have been destroyed, lost or
stolen which have been paid as provided in Section 2.09 hereof.
In determining whether the Holders of the requisite principal amount of
Outstanding Subordinated Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder as of any date,
(A) the principal amount of an Original Issue Discount Subordinated Security
that shall be deemed to be Outstanding for such purposes shall be the amount of
the principal thereof that would be due and payable as of the date of such
determination if a declaration of acceleration of the maturity thereof pursuant
to Section 6.01 had been made, (B) if, as of such date, the principal amount
payable at the Stated Maturity of a Subordinated Security is not determinable,
the principal amount of such Subordinated Security which shall be deemed to be
Outstanding shall be the amount as specified or determined as contemplated by
Section 2.03, (C) the principal amount of a Subordinated Security denominated in
one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the United States Dollar equivalent, determined as of such
date in the manner provided as contemplated by Section 2.03, of the principal
amount of such Subordinated Security (or, in the case of a Subordinated Security
described in clause (A) or (B) above, of the amount determined as provided in
such clause), and (D) Subordinated Securities owned by the Company or any other
obligor upon the Securities or any Affiliate of the Company or of such other
obligor shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent, waiver or other
action, only Subordinated Securities which the Trustee knows to be so owned
shall be so disregarded. Subordinated Securities so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act with respect to
such Subordinated Securities and that the pledgee is not the Company or any
other obligor upon the Securities or any Affiliate of the Company or of such
other obligor.
5
"Paying Agent" means any Person authorized by the Company to pay the
principal of, premium, if any, and any interest on any Subordinated Securities
on behalf of the Company.
"Periodic Offering" means an offering of Subordinated Securities of a
series from time to time, the specific terms of which Subordinated Securities,
including, without limitation, the rate or rates of interest, if any, thereon,
the Stated Maturity or maturities thereof and the redemption provisions, if any,
with respect thereto, are to be determined by the Company or its agents upon the
issuance of such Subordinated Securities.
"Person" means an individual, a corporation, a partnership, a limited
liability company, a joint venture, an association, a joint stock company, a
trust, an unincorporated organization, or a government or any agency, authority
or political subdivision thereof or any other entity.
"Predecessor Subordinated Security" of any particular Subordinated Security
means every previous Subordinated Security evidencing all or a portion of the
same debt as that evidenced by such particular Subordinated Security; and, for
the purposes of this definition, any Subordinated Security authenticated and
delivered under Section 2.05 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Subordinated Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Subordinated Security.
"principal," whenever used with reference to the Subordinated Securities or
any Subordinated Security or any portion thereof, shall be deemed to include
"and premium, if any," provided, however, that such inclusion of premium, if
any, shall under no circumstances result in the double counting of such premium
for the purpose of any calculation required hereunder.
"Record Date" for the interest payable on any Interest Payment Date on any
series of Subordinated Securities means the date specified as such in the
Subordinated Securities of such series.
"Register" shall have the meaning set forth in Section 2.08.
"Registered Global Subordinated Security" means a Subordinated Security
evidencing all or a portion of a series of Registered Subordinated Securities,
issued to the Depositary for such series in accordance with Section 2.12, and
bearing the legend prescribed in Section 2.12 and any other legend required by
the Depositary for such series.
"Registered Subordinated Security" means any Subordinated Security
established pursuant to Section 2.03 which is registered on the Register of the
Company.
"Required Currency" shall have the meaning set forth in Section 13.09.
"Responsible Officer," when used with respect to the Trustee, means any
Vice-President, any Assistant Secretary, any Assistant Treasurer, any cashier,
any assistant cashier, any trust officer, any assistant controller or any other
officer of the Trustee customarily performing corporate trust functions on
behalf of the Trustee and also means, with respect to a particular corporate
trust matter, any other officer of the Trustee to whom such matter is referred
because of such Person's knowledge of and familiarity with the particular
subject.
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"Senior Indebtedness" means (i) the principal of and premium, if any, and
unpaid interest on indebtedness for money borrowed, (ii) purchase money and
similar obligations, (iii) obligations under capital leases, (iv) guarantees,
assumptions or purchase commitments relating to, or other transactions as a
result of which the Company is responsible for the payment of, such indebtedness
of others, (v) renewals, extensions and refunding of any such indebtedness, (vi)
interest or obligations in respect of any such indebtedness accruing after the
commencement of any insolvency or bankruptcy proceedings and (vii) obligations
associated with derivative products such as interest rate and currency exchange
contracts, foreign exchange contracts, commodity contracts, and similar
arrangements, unless, in each case, the instrument by which the Company
incurred, assumed or guaranteed the indebtedness or obligations described in
clauses (i) through (vii) hereof expressly provides that such indebtedness or
obligation is subordinate or junior in right or payment to any other
indebtedness or obligation of the Company.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 2.07.
"Stated Maturity," when used with respect to any Subordinated Security or
any installment of principal thereof or interest thereon, means the date
specified in such Subordinated Security or a Coupon representing such
installment of interest as the fixed date on which the principal of such
Subordinated Security or such installment of principal or interest is due and
payable.
"Subordinated Indenture" means this instrument as originally executed, or
as it may from time to time be supplemented, modified or amended, as provided
herein, and shall include the form and terms of particular series of
Subordinated Securities established in accordance with the provisions of
Sections 2.03 and 2.04.
"Subordinated Security" or "Subordinated Securities" means any security or
securities of the Company without regard to series, authenticated and delivered
under this Subordinated Indenture; provided, that if at any time there is more
than one Person acting as Trustee under this Subordinated Indenture, the term
"Subordinated Securities," with respect to any such Person, shall mean
Subordinated Securities authenticated and delivered under this Subordinated
Indenture, exclusive, however, of Subordinated Securities of any series as to
which such Person is not Trustee.
"Supplemental Subordinated Indenture" means a subordinated indenture
supplemental hereto as such Supplemental Subordinated Indenture may be
originally executed, or as it may from time to time be supplemented, modified or
amended, as provided herein and therein.
"tranche" shall have the meaning set forth in Section 2.14.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended as
of the date of this Subordinated Indenture.
"Trustee" means the Person named as such in the first paragraph of this
Subordinated Indenture until a successor Trustee shall have become such with
respect to one or more series of Subordinated Securities pursuant to the
applicable provisions of this Subordinated Indenture, and thereafter "Trustee"
shall mean or include each Person who is then a Trustee hereunder, and, if at
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any time there is more than one such Person, "Trustee," as used with respect to
the Subordinated Securities of any series, shall mean the Trustee with respect
to the Subordinated Securities of such series.
"United States Dollars" means the lawful currency of the United States of
America.
"Unregistered Subordinated Security" means any Subordinated Security other
than a Registered Subordinated Security.
"U.S. Government Obligations" shall have the meaning set forth in Section
11.01.
"Yield to Maturity" means the yield to maturity on a series of Subordinated
Securities, calculated at the time of issuance of such series, or, if
applicable, at the most recent redetermination of interest on such series, and
calculated in accordance with accepted financial practice.
ARTICLE TWO
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION,
TRANSFER AND EXCHANGE OF SUBORDINATED SECURITIES
SECTION 2.01. Form of Subordinated Securities and Trustee's Certificate of
------------------------------------------------------------
Authentication. The Subordinated Securities of each series and the Coupons, if
--------------
any, to be attached thereto shall be in such form (not inconsistent with this
Subordinated Indenture) as shall be established by or pursuant to one or more
Board Resolutions and as set forth in an Officers' Certificate or established in
one or more Supplemental Subordinated Indentures, in each case with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Subordinated Indenture, and may have such letters,
numbers or other marks of identification or designation and such legends or
endorsements thereon as the Board of Directors may deem appropriate and as are
not inconsistent with the provisions of this Subordinated Indenture, or as may
be required to comply with any law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which the
Subordinated Securities of such series may be listed, or to conform to usage,
all as may be determined by the officers executing such Subordinated Securities
and Coupons, if any, as evidenced by their execution of such Subordinated
Securities and Coupons (but which do not affect the rights or duties of the
Trustee).
If the forms of Subordinated Securities or Coupons of any series are
established by action taken pursuant to a Board Resolution, a copy of an
appropriate record of such action shall be certified by the Secretary or an
Assistant Secretary of the Company and delivered to the Trustee at or prior to
the delivery of the Company Order contemplated by Section 2.04 for the
authentication and delivery of such Subordinated Securities or Coupons.
The definitive Subordinated Securities and Coupons, if any, and each Global
Subordinated Security may be printed, lithographed or fully or partly engraved
or produced in any other manner, all as determined by the officers executing
such Subordinated Securities and Coupons, if any, as evidenced by their
execution thereof.
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SECTION 2.02. Form of Trustee's Certificate of Authentication. Subject to
-----------------------------------------------
Section 7.14, the Trustee's certificate of authentication on all Subordinated
Securities shall be in substantially the following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Subordinated Securities, of the series designated
herein, referred to in the within-mentioned Subordinated Indenture.
HSBC Bank USA, as Trustee
By ____________________________________
Authorized Officer
SECTION 2.03. Amount Unlimited, Issuable in Series.
------------------------------------
(a) The aggregate principal amount of Subordinated Securities which may be
authenticated and delivered under this Subordinated Indenture is not limited.
The Subordinated Securities may be issued in one or more series.
The following terms and provisions of each series of Subordinated
Securities shall be established in or pursuant to one or more Board Resolutions
and set forth in an Officers' Certificate detailing such establishment or
established in one or more Supplemental Subordinated Indentures prior to the
issuance of Subordinated Securities of any series:
(1) the designation of the series of Subordinated Securities of the
series (which shall distinguish the Subordinated Securities of such series from
all other series of Subordinated Securities) and which may be part of a series
of Subordinated Securities previously issued;
(2) any limit upon the aggregate principal amount of the particular
series of Subordinated Securities which may be executed, authenticated and
delivered under this Subordinated Indenture; provided, however, that nothing
contained in this Section 2.03 or elsewhere in this Subordinated Indenture or in
the Subordinated Securities or in an Officers' Certificate or in a Supplemental
Subordinated Indenture is intended to or shall limit execution by the Company or
authentication and delivery by the Trustee of Subordinated Securities under the
circumstances contemplated by Sections 2.08, 2.09, 2.11, 3.03 and 10.04;
(3) if other than United States Dollars, the currency or currencies,
including composite currencies, in which principal of and interest and any
premium on such series of Subordinated Securities shall be payable, if any;
(4) the Stated Maturity for payment of principal of such series of
Subordinated Securities and any sinking fund or analogous provisions;
(5) the rate or rates at which the Subordinated Securities of such
series shall bear interest, if any, the date or dates from which such interest
shall accrue and on which such interest shall be payable, the terms and
conditions of any deferral of interest and the additional interest, if any,
thereon, the right, if any, of the Company to extend the time for payment of
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interest, the terms and duration of such extension rights and (in the case of
Registered Subordinated Securities) the date or dates on which a record shall be
taken for the determination of Holders to whom interest is payable and/or the
method by which such rate or rates or date or dates shall be determined;
(6) the place or places where the principal of and any interest on
Subordinated Securities of any series shall be payable, where such Subordinated
Securities may be surrendered for registration of transfer, where such
Subordinated Securities may be surrendered for exchange and where notice and
demands to or upon the Company in respect of such Subordinated Securities and
this Subordinated Indenture may be served, if other than as provided in Section
4.03;
(7) the right, if any, of the Company to redeem Subordinated
Securities of the series, in whole or in part, at its option and the period or
periods within which, the price or prices at which and any terms and conditions
upon which Subordinated Securities of the series may be so redeemed, pursuant to
any sinking fund or otherwise;
(8) the obligation, if any, of the Company to redeem, purchase or
repay Subordinated Securities of the series pursuant to any mandatory
redemption, sinking fund or analogous provisions or at the option of a Holder
thereof and the price or prices at which and the period or periods within which
and any terms and conditions upon which Subordinated Securities of the series
shall be redeemed, purchased or repaid, in whole or in part, pursuant to such
obligation;
(9) if other than denominations of $1,000 or [_]1,000, as the case
may be, and any integral multiple thereof, in the case of Registered
Subordinated Securities, or $1,000 and $5,000 or [_]1,000 and [_]5,000 in the
case of Unregistered Subordinated Securities, the denominations in which such
series of Subordinated Securities shall be issuable;
(10) the percentage of the principal amount at which the Subordinated
Securities of the series will be issued, and, if other than the principal amount
thereof, the portion of the principal amount of such series of Subordinated
Securities which shall be payable upon declaration of acceleration of the
maturity thereof pursuant to Section 6.01;
(11) if other than the currency or currencies in which the
Subordinated Securities of the series are denominated, the currency or
currencies, including composite currencies or currency units, in which payment
of the principal of or interest on the Subordinated Securities of such series
shall be payable;
(12) if the principal of or interest on the Subordinated Securities of
the series are to be payable, at the election of the Company or a Holder
thereof, in a currency other than that in which the Subordinated Securities of
the series are denominated, the period or periods within which, and the terms
and conditions upon which, such election may be made;
(13) if the amount of payments or principal of or interest on the
Subordinated Securities of the series may be determined with reference to an
index or formula based on a coin, currency, composite currency or currency unit
other than that in which the Subordinated Securities of the series are
denominated, the manner in which such amounts shall be determined;
10
(14) whether the Subordinated Securities of the series will be
issuable as Registered Subordinated Securities (and if such Subordinated
Securities will be issuable as Registered Global Subordinated Securities, the
Depository for such Registered Global Securities and any additional terms and
conditions relating to such Registered Global Subordinated Securities not set
forth in this Subordinated Indenture) or Unregistered Subordinated Securities
(with or without Coupons), or any combination of the foregoing, any restrictions
applicable to the offer, sale or delivery of Unregistered Subordinated
Securities or the payment of interest thereon and, if other than as provided in
Section 2.08, the terms upon which Unregistered Subordinated Securities of any
series may be exchanged for Registered Subordinated Securities of such series
and vice versa;
(15) whether and under what circumstances the Company will pay
additional amounts on the Subordinated Securities of the series held by a Person
who is not a U.S. Person in respect of any tax, assessment or governmental
charge withheld or deducted and, if so, whether the Company will have the option
to redeem the Subordinated Securities of the series rather than pay such
additional amounts;
(16) if the Subordinated Securities of the series are to be issuable
in definitive form (whether upon original issue or upon exchange of a temporary
Subordinated Security of such series) only upon receipt of certain certificates
or other documents or satisfaction of other conditions, the form and terms of
such certificates, documents or conditions;
(17) any trustees, depositaries, authenticating or paying agents,
transfer agents or registrars or any other agents with respect to the
Subordinated Securities of such series;
(18) any additional Events of Default or covenants with respect to the
Subordinated Securities of the series not set forth herein;
(19) the terms of subordination applicable to such series of
Subordinated Securities;
(20) the terms and conditions, if any, upon which any Subordinated
Securities of such series may or shall be converted or exchanged into other
instruments or other forms of property of the Company or its subsidiaries,
including without limitation, securities of another Person held by the Company
or its Affiliates, and if so the terms thereof; and
(21) any other terms of such series of Subordinated Securities (which
terms shall not be inconsistent with the provisions of this Subordinated
Indenture).
(b) All Subordinated Securities of any one series and Coupons, if any,
appertaining thereto shall be substantially identical except (i) that any series
may have serial maturities and different interest rates for different
maturities, (ii) in the case of Registered Subordinated Securities as to
denomination and the differences herein specified between Registered Global
Subordinated Securities and Registered Subordinated Securities issued in
definitive form and (iii) as may otherwise be provided in or pursuant to such
Board Resolution and set forth in such Officers' Certificate or Supplemental
Subordinated Indenture relating to such series of Subordinated Securities. All
Subordinated Securities of any one series need not be issued at the same time,
and, unless otherwise provided in the Officers' Certificate or Supplemental
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Subordinated Indenture relating to such series, a series may be reopened for
issuances of additional Subordinated Securities of such series.
SECTION 2.04. Execution of Subordinated Securities. The Subordinated
------------------------------------
Securities and each Coupon appertaining thereto, if any, shall be executed
manually or in facsimile, by any two of the Chairman of the Board, Chief
Executive Officer, the President, and Vice President, the Secretary, any
Assistant Secretary, the Chief Financial Officer, the Treasurer or any Assistant
Treasurer of the Company under its corporate seal (except in the case of
Coupons), which may be affixed thereto or printed, engraved or otherwise
reproduced thereon, by facsimile or otherwise attested by its Secretary or one
of its Assistant Secretaries.
In case any officer of the Company who shall have signed any of the
Subordinated Securities or Coupons, if any, (manually or in facsimile) shall
cease to be such officer before the Subordinated Securities or Coupons so signed
shall have been authenticated and delivered by the Trustee, or disposed of by
the Company, such Subordinated Securities or Coupons nevertheless may be
authenticated and delivered or disposed of as though the Person who signed such
Subordinated Securities or Coupons had not ceased to be such officer of the
Company. Also, any Subordinated Security or Coupon may be signed on behalf of
the Company by such Persons as on the actual date of execution of such
Subordinated Security or Coupon shall be the proper officers of the Company,
although at the date of the execution of this Subordinated Indenture or on the
nominal date of such Subordinated Security any such Person was not such officer.
SECTION 2.05. Authentication and Delivery of Subordinated Indentures.
------------------------------------------------------
At any time and from time to time after the execution and delivery of
this Subordinated Indenture, the Company may deliver Subordinated Securities of
any series having attached thereto appropriate Coupons, if any, executed by the
Company to the Trustee for authentication by it together with the applicable
documents referred to below in this Section 2.05, and the Trustee shall
thereupon authenticate and deliver said Subordinated Securities (or if only a
single Subordinated Security, such Subordinated Security) and Coupons, if any,
in accordance with the Company Order described below. If provided for in such
procedures, such Company Order may authorize authentication and delivery
pursuant to oral or electronic instructions from the Company or its duly
authorized agent or agents, which instructions, if oral, shall be promptly
confirmed in writing. In authenticating such Subordinated Securities and
accepting the additional responsibilities under this Subordinated Indenture in
relation to such Subordinated Securities, the Trustee shall be entitled to
receive (in the case of subparagraphs (2), (3) and (4) below only at or before
the time of the first issuance of the Subordinated Securities of such series,
provided that, after any such first delivery, any separate request by the
Company that the Trustee authenticate Subordinated Securities of such series for
original issue will be deemed to be a certification by the Company that all
conditions precedent provided for in this Subordinated Indenture relating to
authentication and delivery of such Subordinated Securities continue to be
complied with) and (subject to Section 7.01) shall be fully protected in relying
upon:
(1) a Company Order requesting such authentication and setting forth
delivery instructions if the Subordinated Securities and Coupons, if any, are
not to be delivered to the Company, provided that, with respect to Subordinated
Securities of a series subject to a Periodic Offering, (a) such Company Order
may be delivered by the Company to the Trustee prior to the
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delivery to the Trustee of such Subordinated Securities for authentication and
delivery, (b) the Trustee shall authenticate and deliver Subordinated Securities
of such series for original issue from time to time, in an aggregate principal
amount not exceeding the aggregate principal amount established for such series,
pursuant to a Company Order or pursuant to procedures acceptable to the Trustee
as may be specified from time to time by a Company Order, (c) the maturity date
or dates, original issue date or dates, interest rate or rates and any other
terms of Subordinated Securities of such series shall be determined by a Company
Order or pursuant to such procedures acceptable to the Trustee as may be
specified from time to time by a Company Order and (d) if provided for in such
procedures such Company Order may authorize authentication and delivery pursuant
to oral or electronic instructions from the Company or its duly authorized agent
or agents, which instructions, if oral, shall be promptly confirmed in writing;
(2) any Board Resolution, Officers' Certificate and/or executed
Supplemental Subordinated Indenture referred to in Section 2.01 and 2.03 by or
pursuant to which the forms and terms of the Subordinated Securities and
Coupons, if any, were established;
(3) an Officers' Certificate (i) setting forth the form or forms and
terms of the Subordinated Securities and Coupons, if any, (ii) stating that the
form or forms and terms of the Subordinated Securities and Coupons, if any, have
been established pursuant to Sections 2.01 and 2.03 and comply with this
Subordinated Indenture, and (iii) complying with Section 13.03 and (iv) covering
such other matters as the Trustee may reasonably request; and
(4) an Opinion of Counsel complying with Section 13.03 stating:
(a) that the form or forms of the Subordinated Securities and
Coupons, if any, have been duly authorized and established by or pursuant to a
Board Resolution and an Officers' Certificate or by a Supplemental Subordinated
Indenture and in conformity with the provisions of this Subordinated Indenture;
(b) that, in the case of an underwritten offering, the terms of
the Subordinated Securities have been duly authorized and established by or
pursuant to a Board Resolution and an Officers' Certificate or by a Supplemental
Subordinated Indenture and in conformity with the provisions of this
Subordinated Indenture, and, in the case of an offering that is not
underwritten, certain terms of the Subordinated Securities have been established
pursuant to a Board Resolution, and an Officers' Certificate or a Supplemental
Subordinated Indenture in accordance with this Subordinated Indenture, and when
such other terms as are to be established pursuant to procedures set forth in a
Company Order shall have been established, all such terms will have been duly
authorized by the Company and will have been established in conformity with the
provisions of this Subordinated Indenture;
(c) that such Subordinated Securities, together with the Coupons,
if any, appertaining thereto, when executed and issued by the Company and
authenticated by the Trustee in accordance with the provisions of this
Subordinated Indenture and duly paid for by the purchasers thereof, and subject
to any conditions specified in such Opinion of Counsel, will constitute valid
and binding obligations of the Company, entitled to the benefits provided by
this Subordinated Indenture, enforceable in accordance with their respective
terms, except as any rights thereunder may be limited by the effect of
bankruptcy, insolvency, reorganization,
13
receivership, conservatorship, arrangement, moratorium or other laws affecting
or relating to the rights of creditors generally; the rules governing the
availability of specific performance, injunctive relief or other equitable
remedies and general principles of equity, regardless of whether considered in a
proceeding in equity or at law; the effect of applicable court decisions
invoking statutes or principles of equity, which have held that certain
covenants and provisions of agreements are unenforceable where the breach of
such covenants or provisions imposes restrictions or burdens upon a borrower,
and it cannot be demonstrated that the enforcement of such restrictions or
burdens is necessary for the protection of the creditor, or which have held that
the creditor's enforcement of such covenants or provisions under the
circumstances would have violated the creditor's covenants of good faith and
fair dealing implied under California law; and the effect of California statutes
and rules of law which cannot be waived prospectively by a borrower, and such
counsel need express no opinion with regard to the enforceability of Section
7.06 or of a judgment denominated in a currency other than United States
Dollars;
(d) that all applicable Federal laws and requirements in respect
of the execution and delivery of such Subordinated Securities have been complied
with; and
(e) such other matters as the Trustee may reasonably request.
In rendering such opinions, any counsel may qualify any opinions as to
enforceability by stating that such enforceability may be limited by bankruptcy,
insolvency, reorganization, liquidation, moratorium, fraudulent transfer and
other similar laws affecting the rights and remedies of creditors and is subject
to general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law). Such counsel may rely upon
opinions of other counsel (copies of which shall be delivered to the Trustee),
who shall be reasonably acceptable to the Trustee, in which case the opinion
shall state that such counsel believes he and the Trustee are entitled so to
rely. Such counsel may also state that, insofar as such opinion involves factual
matters, he has relied, to the extent he deems proper, upon certificates of
officers of the Company and its subsidiaries and certificates of public
officials.
The Trustee shall have the right to decline to authenticate and
deliver any Subordinated Securities (i) if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken, (ii) if the
Trustee in good faith by its board of directors, executive committee or a
committee of directors or Responsible Officers shall determine that such action
would expose the Trustee to personal liability to existing Holders or (iii) if
the issue of such Subordinated Securities would affect the Trustee's own rights,
duties or immunities under the Subordinated Securities, this Subordinated
Indenture or otherwise in a manner which is not reasonably acceptable to the
Trustee.
SECTION 2.06. Certificate of Authentication. Only such Subordinated
-----------------------------
Securities as shall bear thereon a certificate of authentication substantially
in the form hereinbefore recited, executed by the Trustee by the manual
signature of one of its authorized officers, shall be entitled to the benefits
of this Subordinated Indenture or be valid or obligatory for any purpose. No
Coupon shall be entitled to the benefits of this Subordinated Indenture or shall
be valid and obligatory for any purpose until the certificate of authentication
on the Subordinated Security to which such Coupon appertains shall have been
duly executed by the Trustee. The execution of such certificate by the Trustee
upon any Subordinated Security executed by the Company shall be conclusive
evidence that the Subordinated Security so authenticated has been duly
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authenticated and delivered hereunder and that the Holder is entitled to the
benefits of this Subordinated Indenture.
SECTION 2.07. Denominations; Payment of Interest on Subordinated
--------------------------------------------------
Securities.
----------
(a) The Subordinated Securities of each series may be issued as Registered
Subordinated Securities or Unregistered Subordinated Securities in denominations
all as shall be specified as contemplated by Section 2.03. In the absence of
such provisions with respect to the Registered Subordinated Securities of any
series, the Subordinated Securities of such series (other than any Registered
Global Subordinated Securities) shall be issued in denominations of $1,000 (or
(euro) 1,000, as applicable) and any integral multiple thereof. If denominations
of Unregistered Subordinated Securities of any series are not so established,
such Subordinated Securities shall be issuable in denominations of $1,000 and
$5,000 (or (euro) 1,000 and (euro) 5,000). The Subordinated Securities of each
series shall be numbered, lettered or otherwise distinguished in such manner or
in accordance with such plan as the officers of the Company executing the same
may determine with the approval of the Trustee, as evidenced by the execution
and authentication thereof (but which shall not affect the rights or duties of
the Trustee).
(b) If the Subordinated Securities of any series shall bear interest, each
Subordinated Security of such series shall bear interest from the applicable
date at the rate per annum specified in the Officers' Certificate or
Supplemental Subordinated Indenture with respect to such series of Subordinated
Securities. Unless otherwise specified in the Officers' Certificate or
Supplemental Subordinated Indenture with respect to the Subordinated Securities
of any series, interest on the Subordinated Securities of such series shall be
computed on the basis of a 360-day year of twelve 30-day months. Such interest
shall be payable on the Interest Payment Dates specified in the Officers'
Certificate or Supplemental Subordinated Indenture with respect to such series
of Subordinated Securities. The Person in whose name any Registered
Subordinated Security (or one or more Predecessor Subordinated Securities) is
registered at the close of business on the applicable Record Date for the series
of which such Subordinated Security is a part shall be entitled to receive the
interest payable thereon on such Interest Payment Date notwithstanding the
cancellation of such Subordinated Security upon any transfer or exchange thereof
subsequent to such Record Date and prior to such Interest Payment Date unless
such Subordinated Security shall have been called for redemption on a Redemption
Date which is subsequent to such Record Date and prior to such Interest Payment
Date or unless the Company shall default in the payment of interest due on such
Interest Payment Date on any Subordinated Security of such series.
Any interest on any Registered Subordinated Security of any series which is
payable, but is not punctually paid or duly provided for, on any Interest
Payment Date (herein called "Defaulted Interest") shall forthwith cease to be
payable to the registered Holder on the relevant Record Date solely by virtue of
such Holder having been such Holder; and such Defaulted Interest may be paid by
the Company, at its election in each case, as provided in clause (1) or (2)
below:
(1) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names such Registered Subordinated Securities (or their
respective Predecessor Subordinated 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
15
each Registered Subordinated Security and the date of the proposed payment
(which date shall be such as will enable the Trustee to comply with the next
sentence hereof), and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements satisfactory to
the Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons entitled
to such Defaulted Interest as in this subsection provided. Thereupon the
Trustee shall fix a Special Record Date for the payment of such Defaulted
Interest which shall be not more than 15 nor less than 10 days prior to the date
of the proposed payment and not less than 10 days after the receipt by the
Trustee of the notice of the proposed payment. The Trustee shall promptly
notify the Company of such Special Record Date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed, first-
class postage prepaid, to each Holder of a Registered Subordinated Security of
such series at such Holder's address as it appears in the Register not less than
10 days prior to such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor having been mailed
as aforesaid, such Defaulted Interest shall be paid to the Persons in whose
names the Registered Subordinated Securities of such series are registered at
the close of business on such Special Record Date and shall no longer be payable
pursuant to the following subsection (2).
(2) The Company may make payment of any Defaulted Interest on the
Subordinated Securities of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange or automated
quotation system on which such Subordinated Securities may be listed and upon
such notice as may be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this subsection, such
manner of payment shall be deemed practicable by the Trustee.
Interest on Subordinated Securities of any series that bear interest may be
paid by mailing a check to the address of the Person entitled thereto as such
address shall appear in the Register.
Subject to the foregoing provisions of this Section 2.07, each Subordinated
Security delivered under this Subordinated Indenture upon registration of
transfer of or in exchange for or in lieu of any other Subordinated Security
shall carry all the rights to interest accrued and unpaid, and to accrue, which
were carried by such other Subordinated Security and each such Subordinated
Security shall bear interest from such date, such that neither gain nor loss in
interest shall result from such transfer, exchange or substitution.
SECTION 2.08. Registration, Transfer and Exchange of Subordinated
---------------------------------------------------
Securities. Except as specifically otherwise provided herein with respect to
----------
Registered Global Subordinated Securities, Subordinated Securities of any series
may be exchanged for a like aggregate principal amount of Subordinated
Securities of the same series of other authorized denominations. Subordinated
Securities to be exchanged shall be surrendered at the offices or agencies to be
maintained in accordance with the provisions of Section 4.03 and the Company
shall execute the Subordinated Security or Subordinated Securities, and the
Trustee shall authenticate and deliver in exchange therefor the Subordinated
Security or Subordinated Securities which the Subordinated Securityholder making
the exchange shall be entitled to receive.
16
The Company shall keep or cause to be kept, at one or more of the offices
or agencies to be maintained by the Company in accordance with the provisions of
Section 4.03 with respect to the Subordinated Securities of each series, a
register (the "Register") in which, subject to such reasonable regulations as it
may prescribe, the Company shall provide for the registration of the Registered
Subordinated Securities of such series and the transfer of Registered
Subordinated Securities of such series as in this Article provided. The
Register shall be in written form or in any other form capable of being
converted into written form within a reasonable time. At all reasonable times
the Register shall be open for inspection by the Trustee and any registrar of
the Subordinated Securities of such series other than the Trustee. Upon due
presentment for transfer of any Subordinated Security of any series at the
offices or agencies of the Company to be maintained in accordance with Section
4.03 with respect to the Registered Subordinated Securities of such series, the
Company shall execute a new Subordinated Security and the Trustee shall
authenticate and deliver in the name of the transferee or transferees a new
Subordinated Security or Registered Subordinated Securities of the same series
for a like aggregate principal amount of authorized denominations.
Notwithstanding any other provisions of this Section 2.08, unless and until it
is exchanged in whole or in part for Registered Subordinated Securities in
definitive form, a Global Subordinated Security representing all or a portion of
the Registered Subordinated Securities of a series may not be transferred except
as a whole by the Depository for such series to a nominee of such Depository or
by a nominee of such Depository to such Depository or another nominee of such
Depository or by such Depository or any such nominee to a successor Depository
for such series or a nominee of such successor Depository.
Unregistered Subordinated Securities (except for any temporary global
Unregistered Subordinated Securities) and Coupons (except for Coupons attached
to any temporary global Unregistered Subordinated Securities) shall be
transferable by delivery.
At the option of the Holder thereof, Registered Subordinated Securities of
any series (other than a Registered Global Subordinated Security, except as set
forth below) may be exchanged for a Registered Subordinated Security or
Registered Subordinated Securities of such series and tenor having authorized
denominations and an equal aggregate principal amount, upon surrender of such
Registered Subordinated Securities to be exchanged at the agency of the Company
that shall be maintained for such purpose in accordance with Section 4.03 and
upon payment, if the Company shall so require, of the charges hereinafter
provided. If the Subordinated Securities of any series are issued in both
registered and unregistered form, except as otherwise established pursuant to
Section 2.03, at the option of the Holder thereof, Unregistered Subordinated
Securities of any series may be exchanged for Registered Subordinated Securities
of such series and tenor having authorized denominations and an equal aggregate
principal amount, upon surrender of such Unregistered Subordinated Securities to
be exchanged at the agency of the Company that shall be maintained for such
purpose in accordance with Section 4.03, with, in the case of Unregistered
Subordinated Securities that have Coupons attached, all unmatured Coupons and
all matured Coupons in default thereto appertaining, and upon payment, if the
Company shall so require, of the charges hereinafter provided. At the option of
the Holder thereof, if Unregistered Subordinated Securities of any series,
maturity date, interest rate and original issue date are issued in more than one
authorized denomination, except as otherwise established pursuant to Section
2.03, such Unregistered Subordinated Securities may be exchanged for
Unregistered Subordinated Securities of such series and tenor having authorized
denominations and an equal aggregate principal amount, upon surrender of such
17
Unregistered Subordinated Securities to be exchanged at the agency of the
Company that shall be maintained for such purpose in accordance with Section
4.03, with, in the case of Unregistered Subordinated Securities that have
Coupons attached, all unmatured Coupons and all matured Coupons in default
thereto appertaining, and upon payment, if the Company shall so require, of the
charges hereinafter provided. Registered Subordinated Securities of any series
may not be exchanged for Unregistered Subordinated Securities of such series
unless (1) otherwise specified pursuant to Section 2.03 and (2) the Company has
delivered to the Trustee an Opinion of Counsel that (x) the Company has received
from the Internal Revenue Service a ruling or (y) since the date hereof, there
has been a change in the applicable United States federal income tax law, in
either case to the effect that the inclusion of terms permitting Registered
Subordinated Securities to be exchanged for Unregistered Subordinated Securities
would result in no United States federal income tax effect adverse to the
Company or to any Holder. Whenever any Subordinated Securities are so
surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Subordinated Securities which the Holder making
the exchange is entitled to receive. All Subordinated Securities and Coupons, if
any, surrendered upon any exchange or transfer provided for in this Subordinated
Indenture shall be promptly cancelled and disposed of by the Trustee, and the
Trustee shall deliver a certificate of disposition thereof to the Company.
All Registered Subordinated Securities of any series presented or
surrendered for exchange, transfer, redemption, conversion or payment shall, if
so required by the Company or the Trustee, be accompanied by a written
instrument or instruments of transfer, in form satisfactory to the Company and
any registar of the Subordinated Securities of such series, duly executed by the
registered Holder or by such Person's attorney duly authorized in writing.
No service charge shall be made for any exchange or registration of
transfer of Subordinated Securities, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto.
The Company shall not be required to exchange or transfer (a) any
Subordinated Securities of any series during a period beginning at the opening
of business 15 days before the day of the first publication or the mailing (if
there is no publication) of a notice of redemption of Subordinated Securities of
such series and ending at the close of business on the day of such publication
or mailing or (b) any Subordinated Securities called or selected for redemption
in whole or in part, except, in the case of Subordinated Securities called for
redemption in part, the portion thereof not so called for redemption in whole or
in part or during a period beginning at the opening of business on any Record
Date for such series and ending at the close of business on the relevant
Interest Payment Date therefor.
SECTION 2.09. Mutilated, Defaced, Destroyed, Lost and Stolen Subordinated
-----------------------------------------------------------
Securities. In case any temporary or definitive Subordinated Security or any
----------
Coupon appertaining to any Subordinated Security shall be mutilated, defaced,
destroyed, lost or stolen, the Company in its discretion may execute and, upon
the written request of any officer of the Company, the Trustee shall
authenticate and deliver, a new Subordinated Security of the same series,
maturity date, interest rate and original issue date, bearing a number or other
distinguishing symbol not contemporaneously outstanding, in exchange and
substitution for the mutilated or defaced Subordinated Security, or in lieu of
and in substitution for the Subordinated Security so destroyed, lost or stolen,
with Coupons corresponding to the Coupons appertaining to
18
the Subordinated Securities so mutilated, defaced, destroyed, lost or stolen, or
in exchange or substitution for the Subordinated Security to which such
mutilated, defaced, destroyed, lost or stolen Coupon appertained, with Coupons
appertaining thereto corresponding to the Coupons so mutilated, defaced,
destroyed, lost or stolen. In every case the applicant for a substitute
Subordinated Security or Coupon shall furnish to the Company and to the Trustee
and any agent of the Company or the Trustee such security or indemnity as may be
required by them to indemnify and defend and to save each of them harmless and,
in every case of destruction, loss or theft, evidence to their satisfaction of
the destruction, loss or theft of such Subordinated Security or Coupon and of
the ownership thereof, and in the case of mutilation or defacement shall
surrender the Subordinated Security and related Coupons to the Trustee or such
agent.
Upon the issuance of any substitute Subordinated Security or Coupon, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) or its agent connected
therewith. In case any Subordinated Security or Coupon which has matured or is
about to mature or has been called for redemption in full shall become mutilated
or defaced or be destroyed, lost or stolen, the Company may instead of issuing a
substitute Subordinated Security, pay or authorize the payment of the same or
the relevant Coupon (without surrender thereof except in the case of a mutilated
or defaced Subordinated Security or Coupon), if the applicant for such payment
shall furnish to the Company and to the Trustee and any agent of the Company or
the Trustee such security or indemnity as any of them may require to save each
of them harmless, and, in every case of destruction, loss or theft, the
applicant shall also furnish to the Company and to the Trustee and any agent of
the Company or the Trustee evidence to their satisfaction of the destruction,
loss or theft of such Subordinated Security or Coupons and of the ownership
thereof.
Every substitute Subordinated Security or Coupon of any series issued
pursuant to the provisions of this Section by virtue of the fact that any such
Subordinated Security or Coupon is destroyed, lost or stolen shall constitute an
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Subordinated Security or Coupon shall be at any time enforceable
by anyone and shall be entitled to all the benefits of (but shall be subject to
all the limitations of rights set forth in) this Subordinated Indenture equally
and proportionately with any and all other Subordinated Securities or Coupons of
such series duly authenticated and delivered hereunder. All Subordinated
Securities and Coupons shall be held and owned upon the express condition that,
to the extent permitted by law, the foregoing provisions are exclusive with
respect to the replacement or payment of mutilated, defaced or destroyed, lost
or stolen Subordinated Securities and Coupons 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 2.10. Cancellation and Destruction of Surrendered Subordinated
--------------------------------------------------------
Securities. All Subordinated Securities and Coupons surrendered for payment,
----------
redemption, transfer, conversion or exchange, or for credit against any payment
in respect of a sinking or analogous fund, if any, shall, if surrendered to the
Company, the Trustee or any agent of the Company or of the Trustee, be delivered
to the Trustee, and the same, together with Subordinated Securities surrendered
to the Trustee for cancellation, shall be canceled by it and thereafter disposed
of by it as directed by the Company, and no Subordinated Securities or Coupons
shall be issued in lieu thereof except as expressly permitted by any of the
provisions of this Subordinated Indenture.
19
The Trustee shall destroy canceled Subordinated Securities and Coupons and
deliver a certificate of destruction thereof to the Company unless, by a Company
Order, the Company shall direct that canceled Subordinated Securities be
returned to it. If the Company shall purchase or otherwise acquire any of the
Subordinated Securities and Coupons, however, such purchase or acquisition shall
not operate as a payment, redemption or satisfaction of the indebtedness
represented by such Subordinated Securities or Coupons unless and until the
Company, at its option, shall deliver or surrender the same to the Trustee for
cancellation.
SECTION 2.11. Temporary Subordinated Securities. Pending the preparation
---------------------------------
of definitive Subordinated Securities of any series, the Company may execute
and, upon a Company Order the Trustee shall authenticate and deliver, temporary
Subordinated Securities of such series which are printed, lithographed,
typewritten or otherwise produced, in each case satisfactory to the Trustee.
Temporary Subordinated Securities of any series shall be issuable as Registered
Subordinated Securities without Coupons, or as Unregistered Subordinated
Securities with or without Coupons attached thereto of any authorized
denomination, and substantially in the form of the definitive Subordinated
Securities of such series but with such appropriate omissions, insertions,
substitutions and other variations as the officers executing such Subordinated
Securities may determine, as evidenced by their execution of such Subordinated
Securities (but which do not affect the rights or duties of the Trustee). Every
such temporary Subordinated Security shall be authenticated by the Trustee upon
the same conditions and in substantially the same manner, and with the same
effect, as the definitive Subordinated Securities. If temporary Subordinated
Securities are issued, the Company will cause definitive Subordinated Securities
to be prepared without unreasonable delay. After the preparation of definitive
Subordinated Securities, the temporary Subordinated Securities of such series
shall be exchangeable for definitive Subordinated Securities upon surrender of
the temporary Subordinated Securities without charge to the Holder at the
offices or agencies to be maintained by the Company as provided in Section 4.03
with respect to the Subordinated Securities of such series and in the case of
Unregistered Subordinated Securities, at any agency maintained by the Company
for such purpose as specified pursuant to Section 2.03. Upon surrender for
cancellation of any one or more temporary Subordinated Securities the Company
shall execute and the Trustee shall authenticate and deliver in exchange for
such temporary Subordinated Securities an equal aggregate principal amount of
definitive Subordinated Securities of such series and, in the case of
Unregistered Subordinated Securities, having attached thereto any appropriate
Coupons. Until so exchanged, the temporary Subordinated Securities of any
series shall in all respects be entitled to the benefits of this Subordinated
Indenture and interest thereon, when and as payable, shall be paid to the
registered owners thereof. The provisions of this Section are subject to any
restrictions or limitations on the issue and delivery of temporary Unregistered
Subordinated Securities of any series that may be established pursuant to
Section 2.03 (including any provision that Unregistered Subordinated Securities
of such series initially be issued in the form of a single global Unregistered
Subordinated Security to be delivered to a depositary or agency located outside
the United States and the procedures pursuant to which definitive Unregistered
Subordinated Securities of such series would be issued in exchange for such
temporary global Unregistered Subordinated Security).
SECTION 2.12. Subordinated Securities in Global Form; Depositories. (a)
----------------------------------------------------
Each Registered Global Subordinated Security shall: (i) represent and be
denominated in an aggregate amount equal to the aggregate principal amount of
the Subordinated Securities of the series to be represented by such Registered
Global Subordinated Security, (ii) be registered in the name of
20
either the Depository for such Registered Global Subordinated Security or the
nominee of such Depository, (iii) be delivered by the Trustee to such Depository
or pursuant to such Depository's written instruction and (iv) bear a legend
substantially to the following effect: "Unless and until it is exchanged in
whole or in part for Subordinated Securities in definitive form, this Registered
Global Subordinated Security may not be transferred except as a whole by the
Depository to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository or by the Depository or any
nominee to a successor Depository or a nominee of any successor Depository." The
notation of the record owner's interest in such Registered Global Subordinated
Security upon the original issuance thereof shall be deemed to be delivered in
connection with the original issuance of each beneficial owner's interest in
such Registered Global Subordinated Security. Without limiting the foregoing,
the Company and the Trustee shall have no responsibility, obligation or
liability with respect to: (x) the maintenance, review or accuracy of the
records of the Depository or of any of its participating organizations with
respect to any ownership interest in or payments with respect to such Registered
Global Subordinated Security, (y) any communication with or delivery of any
notice (including notices of redemption) with respect to the series of
Subordinated Securities represented by the Registered Global Subordinated
Security to any Person having any ownership interest in such Registered Global
Subordinated Security or to any of the Depository's participating organizations
or (z) any payment made on account of any beneficial ownership interest in such
Registered Global Subordinated Security.
(b) If any Subordinated Security of a series is issuable in the form of a
Registered Global Subordinated Security or Subordinated Securities, each such
Registered Global Subordinated Security may provide that it shall represent the
aggregate amount of Outstanding Subordinated Securities of such series from time
to time endorsed thereon and may also provide that the aggregate amount of
Outstanding Subordinated Securities of such series represented thereby may from
time to time be reduced to reflect exchanges. Any endorsement of a Registered
Global Subordinated Security to reflect the amount of Outstanding Subordinated
Securities of a series represented thereby shall be made by the Trustee and in
such manner as shall be specified on such Registered Global Subordinated
Security. Any instructions by the Company with respect to a Registered Global
Subordinated Security, after its initial issuance, shall be in writing but need
not comply with Section 13.03 of this Subordinated Indenture.
(c) Each Depository designated pursuant to the provisions of Section 2.03
of this Subordinated Indenture for a Registered Global Subordinated Security
must, at the time of its designation and at all times while it serves as a
depositary, be a clearing agency registered under the Exchange Act, and any
other applicable statute or regulation. If at any time the Depository for the
Subordinated Securities of a series notifies the Company that it is unwilling or
unable to continue as Depository for the Subordinated Securities of such series
or if at any time the Depository for the Subordinated Securities of such series
shall no longer be eligible under this Section 2.12, the Company shall appoint a
successor Depository with respect to the Subordinated Securities of such series.
If a successor Depository for the Subordinated Securities of such series is not
appointed by the Company within 90 days after the Company receives such notice
or learns of such ineligibility, the Company shall execute and the Company
shall, by Company Order, direct the Trustee to authenticate and deliver
definitive Subordinated Securities of such series in authorized denominations in
exchange for the Registered Global Subordinated Security or Subordinated
Securities. Upon receipt of such Company Order, the Trustee shall thereupon
authenticate and deliver the definitive Subordinated Securities of such series
in the same
21
aggregate principal amount as the Registered Global Subordinated Security or
Subordinated Securities representing such series in exchange for such Registered
Global Subordinated Security or Subordinated Securities, in accordance with the
provisions of subsection (e) of this Section 2.12, without any further corporate
action by the Company.
(d) The Company may at any time and in its sole discretion determine that
the Registered Subordinated Securities of any series issued in the form of one
or more Registered Global Subordinated Securities shall no longer be represented
by such Registered Global Subordinated Security or Subordinated Securities. In
such event, the Company will execute and, upon receipt of a Company Order, the
Trustee shall thereupon authenticate and deliver Subordinated Securities of such
series in definitive form and in authorized denominations in an aggregate
principal amount equal to the principal amount of the Registered Global
Subordinated Security or Subordinated Securities representing such series in
exchange for such Registered Global Subordinated Security or Subordinated
Securities, in accordance with the provisions of subsection (e) of this Section
2.12 without any further corporate action by the Company.
(e) Upon any exchange hereunder of the Registered Global Subordinated
Security or Subordinated Securities for Subordinated Securities in definitive
form, such Registered Global Subordinated Security or Subordinated Securities
shall be canceled by the Trustee. Registered Subordinated Securities issued
hereunder in exchange for the Registered Global Subordinated Security or
Subordinated Securities shall be registered in such names and in such authorized
denominations as the Depository for such Registered Global Subordinated
Security, pursuant to instructions from its direct or indirect participants or
otherwise, shall instruct the Trustee in writing. The Trustee shall deliver
such definitive Subordinated Securities in exchange for the Registered Global
Subordinated Security or Subordinated Securities to the persons in whose name
such definitive Subordinated Securities have been registered in accordance with
the written directions of the Depository.
(f) Any time the Registered Subordinated Securities of any series are not
in the form of Registered Global Subordinated Securities pursuant to the
preceding two paragraphs, the Company agrees to supply the Trustee with a
reasonable supply of certified Registered Subordinated Securities without the
legend required by this Section 2.12 and the Trustee agrees to hold such
Registered Subordinated Securities in safekeeping until authenticated and
delivered pursuant to the terms of this Subordinated Indenture.
If established by the Company pursuant to Section 2.03 with respect to any
Registered Global Subordinated Security, the Depositary for such Registered
Global Subordinated Security may surrender such Registered Global Subordinated
Security in exchange in whole or in part for Subordinated Securities of the same
series and tenor in definitive registered form on such terms as are acceptable
to the Company and such Depositary. Thereupon, the Company shall execute, and
the Trustee, upon Company Order, shall authenticate and deliver, without service
charge,
(i) to the Person specified by such Depositary, new Registered
Subordinated Securities of the same series and tenor, of any authorized
denominations as requested by such Person, in an aggregate principal amount
equal to and in exchange for such Person's beneficial interest in the
Registered Global Subordinated Security; and
22
(ii) to such Depositary, a new Registered Global Subordinated Security
in a denomination equal to the difference, if any, between the principal
amount of the surrendered Registered Global Subordinated Security and the
aggregate principal amount of Registered Subordinated Securities
authenticated and delivered pursuant to clause (i) above.
Registered Subordinated Securities issued in exchange for a Registered
Global Subordinated Security pursuant to this Section 2.12 shall be registered
in such names and in such authorized denominations as the Depositary for such
Registered Global Subordinated Security, pursuant to instructions from its
direct or indirect participants or otherwise, shall instruct the Trustee or an
agent of the Trustee in writing. The Trustee or such agent shall deliver such
Subordinated Securities to or as directed by the Persons in whose names such
Subordinated Securities are so registered.
All Subordinated Securities issued upon any transfer or exchange of
Subordinated Securities shall be valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Subordinated Securities surrendered upon such transfer or exchange.
Notwithstanding anything herein or in the forms or terms of any
Subordinated Securities to the contrary, none of the Company, the Trustee or any
agent of the Company or the Trustee shall be required to exchange any
Unregistered Subordinated Security for a Registered Subordinated Security if
such exchange would result in adverse Federal income tax consequences to the
Company (such as, for example, the inability of the Company to deduct from its
income, as computed for Federal income tax purposes, the interest payable on the
Unregistered Subordinated Securities) under then applicable United States
Federal income tax laws. The Trustee and any such agent shall be entitled to
rely on an Officers' Certificate and an Opinion of Counsel in determining such
result.
SECTION 2.13. CUSIP Numbers. The Company in issuing the Subordinated
-------------
Securities may use "CUSIP" and "CINS" numbers (if then generally in use), and,
if so, the Trustee shall use CUSIP numbers or CINS numbers, as the case may be,
in notices of redemption or exchange as a convenience to Holders and no
representation shall be made as to the correctness of such numbers either as
printed on the Subordinated Securities or as contained in any notice of
redemption or exchange.
SECTION 2.14. Series May Include Tranches. A series of Subordinated
---------------------------
Securities may include one or more tranches (each a "tranche") of Subordinated
Securities, including Subordinated Securities issued in a Periodic Offering.
The Subordinated Securities of different tranches may have one or more different
terms, including authentication dates and public offering prices, but all the
Subordinated Securities within each such tranche shall have identical terms,
including authentication date and public offering price. Notwithstanding any
other provisions of this Subordinated Indenture, with respect to Sections 2.04
through 2.12, 3.01 through 3.05, 4.03, 6.01 through 6.12, 10.02 and 11.01
through 11.05, if any series of Subordinated Securities includes more than one
tranche, all provisions of such sections applicable to any series of
Subordinated Securities shall be deemed equally applicable to each tranche of
any series of Subordinated Securities in the same manner as though originally
designated a series unless otherwise provided with respect to such series or
tranche pursuant to
23
Section 2.03. In particular, and without limiting the scope of the next
preceding sentence, any of the provisions of such sections which provide for or
permit action to be taken with respect to a series of Subordinated Securities
shall also be deemed to provide for and permit such action to be taken instead
only with respect to Subordinated Securities of one or more tranches within that
series (and such provisions shall be deemed satisfied thereby), even if no
comparable action is taken with respect to Subordinated Securities in the
remaining tranches of that series.
ARTICLE THREE
REDEMPTION OF SUBORDINATED SECURITIES AND SINKING FUNDS
SECTION 3.01. Applicability of Article. The provisions of this Article
------------------------
shall be applicable to the Subordinated Securities of any series which are
redeemable before their Stated Maturity or to any sinking fund for the
retirement of Subordinated Securities of a series except as otherwise specified
as contemplated by Section 2.03 for Subordinated Securities of such series.
SECTION 3.02. Notice of Redemption; Partial Redemptions. Notice of
-----------------------------------------
redemption to the Holders of Registered Subordinated Securities of any series to
be redeemed as a whole or in part at the option of the Company shall be given by
mailing notice of such redemption by first class mail, postage prepaid, at least
30 days and not more than 60 days prior to the date fixed for redemption to such
Holders of Subordinated Securities of such series at their last addresses as
they shall appear upon the Register. Notice of redemption to the Holders of
Unregistered Subordinated Securities to be redeemed as a whole or in part, who
have filed their names and addresses with the Trustee pursuant to Section
313(c)(2) of the Trust Indenture Act shall be given by mailing notice of such
redemption, by first class mail, postage prepaid, at least 30 days and not more
than 60 prior to the date fixed for redemption, to such Holders at such
addresses as were so furnished to the Trustee (and, in the case of any such
notice given by the Company, the Trustee shall make such information available
to the Company for such purpose). Notice of redemption to all other Holders of
Unregistered Subordinated Securities shall be published in an Authorized
Newspaper in the Borough of Manhattan, The City of New York and in an Authorized
Newspaper in London (and, if required by Section 4.09, in an Authorized
Newspaper in Luxembourg), in each case, once in each of three successive
calendar weeks, the first publication to be not less than 30 nor more than 60
days prior to the date fixed for redemption. Any notice which is mailed in the
manner herein provided shall be conclusively presumed to have been duly given,
whether or not the Holder receives the notice. Failure to give notice by mail,
or any defect in the notice to the Holder of any Subordinated Security of a
series designated for redemption as a whole or in part shall not affect the
validity of the proceedings for the redemption of such Subordinated Security of
such series.
The notice of redemption to each such Holder shall specify the principal
amount of each Subordinated Security of such series held by such Holder to be
redeemed, the date fixed for redemption, the redemption price, the place or
places of payment, that payment will be made upon presentation and surrender of
such Subordinated Securities and, in the case of Subordinated Securities with
Coupons attached thereto, of all Coupons appertaining thereto maturing after the
date fixed for redemption, that such redemption is pursuant to the mandatory or
optional sinking fund, or both, if such be the case, that interest accrued to
the date fixed for redemption will be paid as specified in such notice and that
on and after said date interest thereon or on the portions thereof to be
redeemed will cease to accrue. In case any Subordinated Security of a series is
to
24
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 Subordinated Security, a new
Subordinated Security or Subordinated Securities of such series in principal
amount equal to the unredeemed portion thereof will be issued.
The notice of redemption of Subordinated Securities of any series to be
redeemed at the option of the Company shall be given by the Company or, at the
Company's request, by the Trustee in the name and at the expense of the Company.
On or before the 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 (or, if the Company is acting as its own Paying
Agent, set aside, segregate and hold in trust as provided in Section 4.05) an
amount of money sufficient to redeem on the redemption date all the Subordinated
Securities of such series so called for redemption at the appropriate redemption
price, together with accrued interest to the date fixed for redemption. The
Company will deliver to the Trustee at least 70 days prior to the date fixed for
redemption, or such shorter period as shall be acceptable to the Trustee, an
Officers' Certificate stating the aggregate principal amount of Subordinated
Securities to be redeemed on the date fixed for redemption. In case of a
redemption at the election of the Company prior to the expiration of any
restriction on such redemption, the Company shall deliver to the Trustee, prior
to the giving of any notice of redemption to Holders pursuant to this Section,
an Officers' Certificate stating that such restriction has been complied with.
If less than all the Subordinated Securities of a series are to be
redeemed, the Trustee shall select, in such manner as it shall deem appropriate
and fair, in its sole discretion, Subordinated Securities of such series to be
redeemed in whole or in part. Subordinated Securities may be redeemed in part
in multiples equal to the minimum authorized denomination for Subordinated
Securities of such series or any multiple thereof. The Trustee shall promptly
notify the Company in writing of the Subordinated Securities of such series
selected for redemption and, in the case of any Subordinated Securities of such
series selected for partial redemption, the principal amount thereof to be
redeemed. For all purposes of this Subordinated Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Subordinated
Securities of any series shall relate, in the case of any Subordinated Security
redeemed or to be redeemed only in part, to the portion of the principal amount
of such Subordinated Security which has been or is to be redeemed.
SECTION 3.03. Payment of Subordinated Securities Called for Redemption.
--------------------------------------------------------
If notice of redemption has been given as above provided, the Subordinated
Securities or portions of Subordinated Securities specified in such notice shall
become due and payable on the date and at the place stated in such notice at the
applicable redemption price, together with interest accrued to the date fixed
for redemption, and on and after said date (unless the Company shall default in
the payment of such Subordinated Securities at the redemption price, together
with interest accrued to said date) interest on the Subordinated Securities or
portions of Subordinated Securities so called for redemption shall cease to
accrue, and the unmatured Coupons, if any, appertaining thereto shall be void,
and, except as provided in Sections 7.05 and 11.04, such Subordinated Securities
shall cease from and after the date fixed for redemption to be entitled to any
benefit or security under this Subordinated Indenture, and the Holders thereof
shall have no right in respect of such Subordinated Securities except the right
to receive the redemption price
25
thereof and unpaid interest to the date fixed for redemption. On presentation
and surrender of such Subordinated Securities at a place of payment specified in
said notice, together with all Coupons, if any, appertaining thereto maturing
after the date fixed for redemption, said Subordinated Securities or the
specified portions thereof shall be paid and redeemed by the Company at the
applicable redemption price, together with interest accrued thereon to the date
fixed for redemption; provided, that payment of interest becoming due on or
prior to the date fixed for redemption shall be payable in the case of
Subordinated Securities with Coupons attached thereto, to the Holders of the
Coupons for such interest upon surrender thereof, and in the case of Registered
Subordinated Securities, to the Holder of such Registered Subordinated
Securities registered as such on the relevant record date, subject to the terms
and provisions of Section 2.03 and 2.07 hereof.
If any Subordinated Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal shall, until paid or duly
provided for, bear interest from the date fixed for redemption at the rate of
interest or Yield to Maturity (in the case of an Original Issue Discount
Subordinated Security) borne by such Subordinated Security.
If any Subordinated Security with Coupons attached thereto is surrendered
for redemption and is not accompanied by all appurtenant Coupons maturing after
the date fixed for redemption, the surrender of such missing Coupon or Coupons
may be waived by the Company and the Trustee, if there be furnished to each of
them such security or indemnity as they may require to save each of them
harmless.
Upon presentation of any Subordinated Security redeemed in part only, the
Company shall execute and the Trustee shall authenticate and deliver to or on
the order of the Holder thereof, at the expense of the Company, a new
Subordinated Security or Subordinated Securities of such series, of authorized
denominations, in principal amount equal to the unredeemed portion of the
Subordinated Security so presented.
SECTION 3.04. Exclusion of Certain Subordinated Securities From
-------------------------------------------------
Eligibility for Selection for Redemption. Subordinated Securities shall be
----------------------------------------
excluded from eligibility for selection for redemption if they are identified by
registration and certificate number in an Officers' Certificate delivered to the
Trustee at least 40 days prior to the last date on which notice of redemption
may be given as being owned of record and beneficially by, and not pledged or
hypothecated by, either (a) the Company or (b) an entity specifically identified
in such Officers' Ceritficate as directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company.
SECTION 3.05. Mandatory and Optional Sinking Funds. The minimum amount of
------------------------------------
any sinking fund payment provided for by the terms of the Subordinated
Securities of any series is herein referred to as a "mandatory sinking fund
payment," and any payment in excess of such mandatory sinking fund payment is
herein referred to as an "optional sinking fund payment." The date on which a
sinking fund payment is to be made is herein referred to as the "sinking fund
payment date."
In lieu of making all or any part of any mandatory sinking fund payment
with respect to any series of Subordinated Securities in cash, the Company may
at its option (a) deliver to the Trustee Subordinated Securities of such series
theretofore purchased or otherwise acquired
26
(except upon redemption pursuant to the mandatory sinking fund) by the Company
or receive credit for Subordinated Securities of such series (not previously so
credited) theretofore purchased or otherwise acquired (except as aforesaid) by
the Company and delivered to the Trustee for cancellation pursuant to Section
2.10, (b) receive credit for optional sinking fund payments (not previously so
credited) made pursuant to this Section, or (c) receive credit for Subordinated
Securities of such series (not previously so credited) redeemed by the Company
through any optional redemption provision contained in the terms of such series.
Subordinated Securities so delivered or credited shall be received or credited
by the Trustee at the sinking fund redemption price specified in such
Subordinated Securities.
On or before the 60/th/ day next preceding each sinking fund payment date
for any series, the Company will deliver to the Trustee an Officers' Certificate
(which need not contain the statements required by Section 13.03) (a) specifying
the portion of the mandatory sinking fund payment to be satisfied by payment of
cash and the portion to be satisfied by credit of Subordinated Securities of
such series and the basis for such credit, (b) stating that none of the
Subordinated Securities of such series has theretofore been so credited, (c)
stating that no defaults in the payment of interest or Events of Default with
respect to such series have occurred (which have not been waived or cured) and
are continuing and (d) stating whether or not the Company intends to exercise
its right to make an optional sinking fund payment with respect to such series
and, if so, specifying the amount of such optional sinking fund payment which
the Company intends to pay on or before the next succeeding sinking fund payment
date. Any Subordinated Securities of such series to be credited and required to
be delivered to the Trustee in order for the Company to be entitled to credit
therefor as aforesaid which have not theretofore been delivered to the Trustee
shall be delivered for cancellation pursuant to Section 2.10 to the Trustee with
such Officers' Certificate (or reasonably promptly thereafter if acceptable to
the Trustee). Such Officers' Certificate shall be irrevocable and upon its
receipt by the Trustee the Company shall become unconditionally obligated to
make all the cash payments or payments therein referred to, if any, on or before
the next succeeding sinking fund payment date. Failure of the Company, on or
before any such 60/th/ day, to deliver such Officers' Certificate and
Subordinated Securities specified in this paragraph, if any, shall not
constitute a default but shall constitute, on and as of such date, the
irrevocable election of the Company (i) that the mandatory sinking fund payment
for such series due on the next succeeding sinking fund payment date shall be
paid entirely in cash without the option to deliver or credit Subordinated
Securities of such series in respect thereof and (ii) that the Company will make
no optional sinking fund payment with respect to such series as provided in this
Section.
If the sinking fund payment or payments (mandatory or optional or both) to
be made in cash on the next succeeding sinking fund payment date plus any unused
balance of any preceding sinking fund payments made in cash shall exceed $50,000
(or the equivalent thereof in any Foreign Currency or ECU) or a lesser sum in
United States Dollars (or the equivalent thereof in any Foreign Currency or ECU)
if the Company shall so request with respect to the Subordinated Securities of
any particular series, such cash shall be applied on the next succeeding sinking
fund payment date to the redemption of Subordinated Securities of such series at
the sinking fund redemption price together with accrued interest to the date
fixed for redemption. If such amount shall be $50,000 (or the equivalent
thereof in any Foreign Currency or ECU) or less and the Company makes no such
request then it shall be carried over until a sum in excess of $50,000 (or the
equivalent thereof in any Foreign Currency or ECU) is available. The Trustee
shall select, in the manner provided in Section 3.02, for redemption on such
sinking
27
fund payment date a sufficient principal amount of Subordinated Securities of
such series to absorb said cash, as nearly as may be, and shall (if requested in
writing by the Company) inform the Company of the serial numbers of the
Subordinated Securities of such series (or portions thereof) so selected.
Subordinated Securities shall be excluded from eligibility for redemption under
this Section if they are identified by registration and certificate number in an
Officers' Certificate delivered to the Trustee at least 60 days prior to the
sinking fund payment date as being owned of record and beneficially by, and not
pledged or hypothecated by, either (a) the Company or (b) an entity specifically
identified in such Officers' Certificate as directly or indirectly controlling
or controlled by or under direct or indirect common control with the Company.
The Trustee, in the name and at the expense of the Company (or the Company, if
it shall so notify the Trustee in writing) shall cause notice of redemption of
the Subordinated Securities of such series to be given in the manner provided in
Section 3.02 (and with the effect provided in Section 3.03) for the redemption
of Subordinated Securities of such series in part at the option of the Company.
The amount of any sinking fund payments not so applied or allocated to the
redemption of Subordinated Securities of such series shall be added to the next
cash sinking fund payment for such series and, together with such payment, shall
be applied in accordance with the provisions of this Section. Any and all
sinking fund moneys held on the Stated Maturity date of the Subordinated
Securities of any particular series (or earlier, if such maturity is
accelerated), which are not held for the payment or redemption of particular
Subordinated Securities of such series shall be applied, together with other
moneys, if necessary, sufficient for the purpose, to the payment of the
principal of, and interest on, the Subordinated Securities of such series at its
Stated Maturity.
On or before each sinking fund payment date, the Company shall pay to the
Trustee in cash or shall otherwise provide for the payment of all interest
accrued to the date fixed for redemption on Subordinated Securities to be
redeemed on the next following sinking fund payment date.
The Trustee shall not redeem or cause to be redeemed any Subordinated
Securities of a series with sinking fund moneys or give any notice of redemption
of Subordinated Securities for such series by operation of the sinking fund
during the continuance of a default in payment of interest on such Subordinated
Securities or of any Event of Default except that, where the giving of notice of
redemption of any Subordinated Securities shall theretofore have been made, the
Trustee shall redeem or cause to be redeemed such Subordinated Securities,
provided that it shall have received from the Company a sum sufficient for such
redemption. Except as aforesaid, any moneys in the sinking fund for such series
at the time when any such default or Event of Default shall occur, and any
moneys thereafter paid into the sinking fund, shall, during the continuance of
such default or Event of Default be deemed to have been collected under Article
6 and held for the payment of all such Subordinated Securities. In case such
Event of Default shall have been waived as provided in Section 6.09 or the
default cured on or before the sixtieth day preceding the sinking fund payment
date, such moneys shall thereafter be applied on the next succeeding sinking
fund payment date in accordance with this Section to the redemption of such
Subordinated Securities.
28
ARTICLE FOUR
PARTICULAR COVENANTS OF THE COMPANY
SECTION 4.01. Payment of Principal of and Interest on Subordinated
----------------------------------------------------
Securities. The Company covenants that it will duly and punctually pay or cause
----------
to be paid the principal of and any interest and premium on each of the
Subordinated Securities in accordance with the terms of the Subordinated
Securities and in the Coupons, if any, appertaining thereto and this
Subordinated Indenture. Except with respect to any Registered Global
Subordinated Securities, if the Subordinated Securities of any series bear
interest, each installment of interest on the Subordinated Securities of such
series may, at the option of the Company, be paid by mailing a check or checks
for such interest payable to the Person entitled thereto pursuant to Section
2.07 to the address of such Person as it appears on the Register of such series
on the applicable Record Date for such interest payment. The interest on
Securities with Coupons attached (together with any additional amounts payable
pursuant to the terms of such Securities) shall be payable only upon
presentation and surrender of the several Coupons for such interest installments
as are evidenced thereby as they severally mature. If any temporary
Unregistered Security provides that interest thereon may be paid while such
Security is in temporary form, the interest on any such temporary Unregistered
Security (together with any additional amounts payable pursuant to the terms of
such Security) shall be paid, as to the installments of interest evidenced by
Coupons attached thereto, if any, only upon presentation and surrender thereof,
and, as to the other installments of interest, if any, only upon presentation of
such Securities for notation thereon of the payment of such interest, in each
case subject to any restrictions that may be established pursuant to Section
2.03. The interest, if any, on Registered Securities (together with any
additional amounts payable pursuant to the terms of such Securities) shall be
payable only to or upon the written order of the Holders thereof and, at the
option of the Company, may be paid by wire transfer or by mailing checks for
such interest payable to or upon the written order of such Holders at their last
addresses as they appear on the Register of the Company.
SECTION 4.02. Corporate Existence of the Company; Consolidation, Merger,
----------------------------------------------------------
Sale or Transfer. The Company covenants that so long as any of the Subordinated
----------------
Securities are Outstanding, it will maintain its existence, will not dissolve,
sell or otherwise dispose of all or substantially all of its assets and will not
consolidate with or merge into another Person or permit one or more other
Persons to consolidate with or merge into it; provided that the Company may,
without violating the covenants in this Section 4.02 contained, consolidate with
or merge into another Person or permit one or more other Persons to consolidate
with or merge into it, or sell or otherwise transfer to another Person all or
substantially all of its assets as an entirety and thereafter dissolve, if the
surviving, resulting or transferee Person, as the case may be, (i) shall be
organized and existing under the laws of one of the States of the United States
of America or the District of Columbia, (ii) assumes, if such Person is not the
Company, all of the obligations of the Company hereunder and (iii) is not, after
such transaction, otherwise in default under any provisions hereof.
SECTION 4.03. Maintenance of Offices or Agencies for Transfer,
------------------------------------------------
Registration, Exchange and Payment of Subordinated Securities. So long as any
-------------------------------------------------------------
of the Subordinated Securities shall remain Outstanding, the Company covenants
that it will maintain an office or agency in either The City of New York, State
of New York, or the City and County of San Francisco, State of California, where
the Subordinated Securities may be presented for
29
registration, exchange and transfer as in this Subordinated Indenture provided,
and where notices and demands to or upon the Company in respect of the
Subordinated Securities of any series, the Coupons appertaining thereto or of
this Subordinated Indenture may be served, and where the Subordinated Securities
may be presented for payment. The Company hereby initially appoints the Trustee
its office or agency for each of said purposes. In case the Company shall fail
to maintain any such office or agency, presentations and demands may be made and
notices may be served at the Corporate Trust Office.
The Company will maintain one or more agencies in a city or cities located
outside the United States (including any city in which such an agency is
required to be maintained under the rules of any stock exchange on which the
Securities of any series are listed) where the Unregistered Securities, if any,
of each series and Coupons, if any, appertaining thereto may be presented for
payment. No payment on any Unregistered Security or Coupon will be made upon
presentation of such Unregistered Security or Coupon at an agency of the Company
within the United States nor will any payment be made by transfer to an account
in, or by mail to an address in, the United States unless, pursuant to
applicable United States laws and regulations then in effect, such payment can
be made without adverse tax consequences to the Company. Notwithstanding the
foregoing, if full payment in United States Dollars at each agency maintained by
the Company outside the United States for payment on such Unregistered
Securities or Coupons appertaining thereto is illegal or effectively precluded
by exchange controls or other similar restrictions, payments in United States
Dollars of Unregistered Securities of any series and coupons appertaining
thereto which are payable in United States Dollars may be made at an agency of
the Company maintained in The City of New York. The Company will give prompt
written notice to the Trustee of the location, and any change in the location,
of such agency.
The Company may from time to time designate one or more additional offices
or agencies where the Subordinated Securities of a series and any Coupons
appertaining thereto may be presented for payment, where the Subordinated
Securities of that series may be presented for exchange as provided in this
Subordinated Indenture and pursuant to Section 2.04 and where the Registered
Subordinated Securities of that series may be presented for registration of
transfer as in this Subordinated Indenture provided, and the Company may from
time to time rescind any such designation, as the Company may deem desirable or
expedient; provided, that no such designation or rescission shall in any manner
relieve the Company of its obligations to maintain the agencies provided for in
this Section. The Company shall give to the Trustee prompt written notice of
any such designation or rescission thereof.
SECTION 4.04. Appointment to Fill a Vacancy in the Office of Trustee. The
------------------------------------------------------
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
covenants that it will appoint, in the manner provided in Section 7.10, a
Trustee, so that there shall at all times be a Trustee with respect to the
Outstanding Subordinated Securities.
SECTION 4.05. Duties of Paying Agent. (a) If the Company shall appoint a
----------------------
Paying Agent other than the Trustee with respect to Subordinated Securities of
any series, it will cause such Paying Agent to execute and deliver to the
Trustee an instrument in which such Paying Agent shall agree with the Trustee,
subject to the provisions of this Section 4.05 and Section 11.04, that such
Paying Agent will:
30
(1) hold all sums held by it as such Payment Agent for the payment of
the principal of or interest, if any, on the Subordinated Securities of such
series (whether such sums have been paid to it by the Company or by any other
obligor on the Subordinated Securities of such series) in trust for the benefit
of the Holders of the Subordinated Securities or the Coupons appertaining
thereto entitled to such principal or interest and will notify the Trustee in
writing of the receipt of sums to be so held,
(2) give the Trustee written notice of any failure by the Company (or
by any other obligor on the Subordinated Securities of such series) to make any
payment of the principal of or interest on the Subordinated Securities of such
series when the same shall be due and payable, and
(3) at any time during the continuance of any Event of Default, upon
the written request of the Trustee, deliver to the Trustee all sums so held in
trust by it.
(b) Whenever the Company shall have one or more Paying Agents with respect
to the Subordinated Securities of any series, it will, prior to each due date of
the principal of or any interest on the Subordinated Securities of such series,
deposit with a Paying Agent of such series a sum sufficient to pay the principal
or interest so becoming due, such sum to be held in trust for the benefit of the
Holders of Subordinated Securities or the Coupons appertaining thereto entitled
to such principal or interest, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee in writing of its action or failure so
to act.
(c) If the Company shall act as its own Paying Agent with respect to the
Subordinated Securities of any series, it will, on or before each due date of
the principal of or interest on the Subordinated Securities of such series, set
aside, segregate and hold in trust for the benefit of the Holders of the
Subordinated Securities of such series or the Coupons appertaining thereto a sum
sufficient to pay such principal or interest so becoming due. The Company will
promptly notify the Trustee in writing of any failure to take such action.
(d) Anything in this Section 4.05 to the contrary notwithstanding, the
Company may, at any time, for the purpose of obtaining a satisfaction and
discharge of this Subordinated Indenture with respect to one or more or all
series of Subordinated Securities hereunder, or for any other reason, pay or
cause to be paid to the Trustee all sums held in trust for such series by it, or
any Paying Agent hereunder, as required by this Section 4.05, and such sums are
to be held by the Trustee upon the trust herein contained.
(e) Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of or any premium or
interest on any Subordinated Security of any series and remaining unclaimed for
two years after such principal, premium, if any, or interest has become due and
payable shall be paid to the Company on Company Order, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such
Subordinated Security or any Coupon appertaining thereto shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in an Authorized Newspaper in The City of New York, notice
that
31
such money remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be repaid to the Company.
SECTION 4.06. Notice of Default.
-----------------
(a) The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date of this Subordinated
Indenture, a certificate, signed by the principal executive officer, principal
financial officer or principal accounting officer of the Company, stating
whether or not to the best knowledge of the signer thereof the Company is in
default in the performance and observance of any of the terms, provisions and
conditions of this Subordinated Indenture (without regard to any period of grace
or requirement of notice provided hereunder) and, if the Company shall be in
default, specifying all such defaults and the nature and status thereof of which
they may have knowledge.
(b) The Company covenants that, within five days after the occurrence
thereof, the Company will furnish the Trustee written notice of any event which
is an Event of Default or which with the giving of notice or the passage of time
or both would constitute an Event of Default which notice shall set forth the
nature of such event and the action which the Company proposes to take with
respect thereto.
SECTION 4.07. Maintenance of Properties. The Company will cause all
-------------------------
properties used in or useful in the conduct of its business to be maintained and
kept in good condition, repair, and working order and supplied with all
necessary equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary, so that the business carried on in connection
therewith may be properly and advantageously conducted at all time except to the
extent that the Company may be prevented from so doing by circumstances beyond
its control; provided, that nothing in this Section shall prevent the Company
from discontinuing the operation or maintenance of any of such properties, or
disposing of any of them, if such discontinuance or disposal is, in the judgment
of the Company, desirable in the conduct of the business of the Company and not
disadvantageous in any material respect to the Subordinated Securityholders.
SECTION 4.08. Payment of Taxes and Other Claims. The Company will pay or
---------------------------------
discharge or cause to be paid or discharged, before the same shall become
delinquent: (a) all taxes, assessments and governmental charges levied or
imposed upon the Company or upon the income, profits or property of the Company;
and (b) all lawful claims for labor, materials, and supplies, which, if unpaid,
might by law become a lien upon the property of the Company; provided, that the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount, applicability
or validity is being contested in good faith by appropriate proceedings; and
provided further that the Company shall not be required to cause to be paid or
discharged any such tax, assessment, charge or claim if the Company shall
determine that such payment is not advantageous to the conduct of the business
of the Company taken as a whole and that the failure so to pay or discharge is
not disadvantageous in any material respect to the Subordinated Securityholders.
SECTION 4.09. Luxembourg Publications. In the event of the publication of
-----------------------
any notice pursuant to Sections 3.02, 6.10, 7.10(a), 7.11 and 10.02, the party
making such publication in the
32
Borough of Manhattan, The City of New York and London shall also, to the extent
that notice is required to be given to Holders of Subordinated Securities of any
series by applicable Luxembourg law or stock exchange regulation, as such
requirement is evidenced by an Officers' Certificate delivered to such party,
make a similar publication in Luxembourg.
ARTICLE FIVE
SUBORDINATED SECURITYHOLDERS' LISTS AND REPORTS
BY THE COMPANY AND THE TRUSTEE
SECTION 5.01. Company to Furnish Trustee Information as to the Names and
----------------------------------------------------------
Addresses of Subordinated Securityholders. The Company will furnish or cause to
-----------------------------------------
be furnished to the Trustee:
(a) semi-annually, not more than 15 days after each Record Date, a list,
in such form as the Trustee may reasonably require, of the names and addresses
of the Holders of the 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,
excluding from any such list names and addresses received by the Trustee in its
capacity as registrar.
SECTION 5.02. Preservation of Information; Communication to Subordinated
----------------------------------------------------------
Securityholders. (a) The Trustee shall preserve, in as current a form as is
---------------
reasonably practicable, the names and addresses of the Holders of Subordinated
Securities of each series (1) contained in the most recent list furnished to it
as provided in Section 5.01, (2) received by the Trustee in the capacity of
Paying Agent or registrar (if so acting) and (3) filed with the Trustee within
the two preceding years as provided for in Section 5.04(b). The Trustee may
destroy any list furnished to it as provided in Section 5.01 upon receipt of a
new list so furnished.
(b) If three or more Holders of Subordinated 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 Subordinated
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 Subordinated Securities of any series or with
Holders of all Subordinated Securities with respect to their rights under this
Subordinated Indenture or under such Subordinated 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:
(1) afford such applicants access to the information preserved at the
time by the Trustee in accordance with the provisions of subsection (a) of this
Section 5.02; or
(2) inform such applicants as to the approximate number of Holders of
Subordinated Securities of such series or all Subordinated Securities, as the
case may be,
33
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
5.02, and as to the approximate cost of mailing to such Subordinated
Securityholders the form of proxy or other communications, 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 of the Holders of Subordinated Securities of such series, or all
Subordinated Securities, as the case may be, whose name and address appear in
the information preserved at the time by the Trustee in accordance with the
provisions of subsection (a) of this Section 5.02, 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 Commission, together with a copy of the material to
be mailed, a written statement to the effect that, in the opinion of the
Trustee, such mailing would be contrary to the best interests of the Holders of
Subordinated Securities of such series or all Subordinated Securities, as the
case may be, or would be in violation of applicable law. Such written statement
shall specify the basis of such opinion. If the Commission, after opportunity
for a hearing upon the objections specified in the written statement so filed,
shall enter an order refusing to sustain any of such objections or if, after the
entry of an order sustaining one or more of such objections, the Commission
shall find, after notice and opportunity for hearing, that all the objections so
sustained have been met and shall enter an order so declaring, the Trustee shall
mail copies of such material to all such Subordinated Securityholders with
reasonable promptness after the entry of such order and the renewal of such
tender; otherwise the Trustee shall be relieved of any obligation or duty to
such applicants respecting their application.
(c) Each and every Holder of the Subordinated Securities, by receiving and
holding the same, agrees with the Company and the Trustee that neither the
Company nor the Trustee nor any Paying Agent nor any registrar nor any agent of
any of them shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders of Subordinated
Securities in accordance with the provisions of subsection (b) of this Section
5.02, 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 5.03. Reports by Company. (a) The Company covenants and agrees
------------------
to file with the Trustee within 15 days after the Company is required to file
the same with the Commission, copies of the annual reports and of the
information, documents and other reports (or copies of such portions of any of
the foregoing as the Commission may from time to time by rules and regulations
prescribe) which the Company may be required to file with the Commission
pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if the Company
is not required to file information, documents or reports pursuant to either of
such sections, then to file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the Commission, such
of the supplementary and periodic information, documents and reports which may
be required pursuant to Section 13 of the Exchange Act in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations.
34
(b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed from time to
time by the Commission, such additional information, documents and reports with
respect to compliance by the Company with the conditions and covenants provided
for in this Subordinated Indenture as may be required from time to time by such
rules and regulations.
(c) The Company covenants and agrees to transmit to the Holders of
Subordinated Securities within 30 days after the filing thereof with the
Trustee, in the manner and to the extent provided in subsection (c) of Section
5.04 with respect to reports pursuant to subsection (a) of said Section 5.04,
such summaries of any information, documents and reports required to be filed by
the Company pursuant to subsections (a) and (b) of this Section 5.03 as may be
required by rules and regulations prescribed from time to time by the
Commission.
SECTION 5.04. Reports by Trustee.
------------------
(a) Within 60 days after May 15 in each year, the Trustee shall transmit by
mail to all Holders, as their names and addresses appear in the Register, a
brief report dated as of such May 15, in accordance with, and to the extent
required under, Section 313 of the Trust Indenture Act.
(b) Reports pursuant to this Section 5.04 shall be transmitted by mail (i)
to all Holders of Subordinated Securities of any series, as the names and
addresses of such Holders shall appear upon the Register of the Subordinated
Securities of such series, (ii) to such Holders of Subordinated Securities as
have, within the two years preceding such transmission, filed their names and
addresses with the Trustee for that purpose and (iii), except in the case of
reports pursuant to subsection (b) of this Section 5.04, to each Holder whose
name and address are preserved at the time by the Trustee as provided in Section
5.02(a) hereof.
(c) A copy of each such report shall, at the time of such transmission to
Subordinated Securityholders, be filed by the Trustee with each stock exchange
upon which the Subordinated Securities of any series are listed and also with
the Commission. The Company will notify the Trustee when and as the
Subordinated Securities of any series become listed on any stock exchange.
ARTICLE SIX
REMEDIES OF THE TRUSTEE AND SUBORDINATED
SECURITYHOLDERS ON EVENT OF DEFAULT
SECTION 6.01. Events of Default; Acceleration, Waiver of Default and
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Restoration of Position and Rights. The term "Event of Default," whenever used
----------------------------------
herein with respect to any particular series of Subordinated Securities, shall
mean any one of the following events:
(a) default in the payment of any installment of interest on any
Subordinated Security of such series as and when the same shall become due and
payable, and continuance of such default for a period of 30 days; provided,
however, that an extension of one or more Interest Payment Dates by the Company
in accordance with the provisions of any Supplemental Subordinated Indenture
shall not constitute an Event of Default; or
35
(b) default in the payment of all or any part of the principal of or any
premium on any Subordinated Security of such series as and when the same shall
become due and payable whether at maturity, by proceedings for redemption, by
declaration or otherwise; provided, however, that an extension of the Stated
Maturity for payment of principal of Subordinated Securities of such series in
accordance with the provisions of any Supplemental Subordinated Indenture shall
not constitute an Event of Default; or
(c) default in the satisfaction of any sinking fund payment obligation
relating to such series of Subordinated Securities, when and as such obligation
shall become due and payable; provided, however, that an extension of the Stated
Maturity for payment of any sinking fund payment with respect to Subordinated
Securities of such series in accordance with the provisions of any Supplemental
Subordinated Indenture shall not constitute an Event of Default; or
(d) failure on the part of the Company to observe or perform any other of
the covenants or agreements on its part to be observed or performed in the
Subordinated Securities or in this Subordinated Indenture (including any
Supplemental Subordinated Indenture or pursuant to any Officers' Certificate, as
contemplated by Section 2.03), other than a covenant or agreement which has been
expressly included in or pursuant to this Subordinated Indenture solely for the
benefit of the Holders of the Subordinated Securities of one or more series of
Subordinated Securities other than that series, and continuance of such failure
for a period of 60 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 principal amount at maturity of the Subordinated
Securities of such series at the time Outstanding under this Subordinated
Indenture, a written notice specifying such failure and stating that such notice
is a "Notice of Default" hereunder; or
(e) the entry by a court having jurisdiction in the premises of a decree or
order for relief in respect of the Company in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Company or for any substantial part of
its property, or ordering the winding up or liquidation of its affairs, if such
decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or
(f) the commencement by the Company of a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or the Company's consent to the entry of an order for relief in any
involuntary case under any such law, or its consent to the appointment of or
taking possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator (or similar official) of the Company or for any substantial part of
its property, or the making by the Company of any general assignment for the
benefit of creditors, or its failure generally to pay its debts as they become
due or the taking by the Company of any corporate action in furtherance of any
of the foregoing; or
(g) any other Event of Default provided in the Officers' Certificate or
Supplemental Subordinated Indenture under which such series of Subordinated
Securities is issued.
If an Event of Default described in clause (a), (b) or (c) shall have
occurred and be continuing with respect to any one or more series of Outstanding
Subordinated Securities, then and in each and every such case, unless the
principal amount of all the Subordinated
36
Securities of each series as to which there is an Event of Default shall have
already become due and payable, either the Trustee or the Holders of not less
than 25% in principal amount at maturity of the Subordinated Securities of such
series then Outstanding hereunder (each such series voting as a separate class)
by notice in writing to the Company (and to the Trustee, if given by
Subordinated Securityholders) may declare the principal amount (or, if the
Subordinated Securities of any such series are Original Issue Discount
Subordinated Securities, such portion of the principal amount as may be
specified in the terms of such series) of all the Subordinated Securities of
such series, together with any accrued interest, to be due and payable
immediately, and upon any such declaration the same shall be immediately due and
payable, anything in this Subordinated Indenture or in the Subordinated
Securities of such series contained to the contrary notwithstanding.
Except as otherwise provided in the terms of any series of Subordinated
Securities pursuant to Section 2.03, if an Event of Default described in clause
(d) or (g) above with respect to all series of Subordinated Securities then
Outstanding occurs and is continuing, then, and in each and every such case,
unless the principal of all of the Subordinated Securities shall have already
become due and payable, either the Trustee or the Holders of not less than 25%
in aggregate principal amount at maturity of all of the Subordinated Securities
then Outstanding hereunder (treated as one class) by notice in writing to the
Company (and to the Trustee, if given by Securityholders) may declare the entire
principal (or, if the Subordinated Securities of any series are Original Issue
Discount Securities, such portion of the principal amount as may be specified in
the terms of such series) of all of the Subordinated Securities then
Outstanding, and the interest accrued thereon, if any, to be due and payable
immediately, and upon such declaration, the same shall become immediately due
and payable. If an Event of Default described in clause (e) or (f) above occurs
and is continuing, then the principal amount of all of the Subordinated
Securities then Outstanding, and the interest accrued thereon, if any, shall
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Holder.
If an Event of Default described in clause (d) or (g) occurs and is
continuing, which Event of Default is with respect to less than all series of
Subordinated Securities then Outstanding, then, and in each and every such case,
except for any series of Subordinated Securities the principal of which shall
have already become due and payable, either the Trustee or the Holders of not
less than 25% in aggregate principal amount at maturity of the Subordinated
Securities of each such affected series then Outstanding hereunder (each such
series voting as a separate class) by notice in writing to the Company (and to
the Trustee, if given by Securityholders) may declare the entire principal (or,
if the Securities of such series are Original Issue Discount Securities, such
portion of the principal amount as may be specified in the terms of such series)
of all Securities of such series, and the interest accrued thereon, if any, to
be due and payable immediately, and upon any such declaration, the same shall
become immediately due and payable.
The foregoing provisions, however, are subject to the condition that if, at
any time after the principal amount (or, if the Subordinated Securities are
Original Issue Discount Subordinated Securities, such portion of the principal
as may be specified in the terms thereof of the Subordinated Securities of any
one or more series (or of all the Subordinated Securities, as the case may be)
shall have been so declared due and payable, and before any judgment or decree
for the payment of moneys due shall have been obtained or entered as hereinafter
provided, the
37
Company shall (1) pay or shall deposit with the Trustee a sum sufficient to pay:
(a) all matured installments of interest upon all the Subordinated Securities of
such series (or upon all the Subordinated Securities, as the case may be); (b)
the principal of any and all Subordinated Securities of such series (or of any
and all the Subordinated Securities, as the case may be) which shall have become
due otherwise than by declaration (with interest on overdue installments of
interest to the extent permitted by law and on such principal at the rate or
rates of interest borne by, or prescribed therefor in the Subordinated
Securities of such series to the date of such payment or deposit); (c) interest
upon such principal and, to the extent that payment of such interest is
enforceable under applicable law, on overdue installments of interest, at the
same rate as the rate of interest or Yield to Maturity (in the case of Original
Issue Discount Securities) specified in the Securities of such series (or at the
respective rates of interest or Yields to Maturity of all the Securities, as the
case may be) to the date of such payment or deposit; and (d) all amounts payable
to the Trustee under Section 7.06 and (2) any and all defaults under the
Subordinated Indenture with respect to Subordinated Securities of such series
(or all Subordinated Securities, as the case may be), other than the non-
payment of principal of and any accrued interest on Subordinated Securities of
such series (or any Subordinated Securities, as the case may be) which shall
have become due by declaration, shall have been cured, remedied or waived as
provided in Section 6.09 -- then, and in every such case, the Holders of a
majority in principal amount at maturity of the Subordinated Securities of such
series (or of all the Subordinated Securities, as the case may be) then
Outstanding (such series or all series voting as one class if more than one
series are so entitled), by written notice to the Company and to the Trustee,
may rescind and annul such declaration and its consequences; but no such
rescission and annulment shall extend to or shall affect any subsequent default,
or shall impair any right consequent thereon.
For all purposes under this Subordinated Indenture, if a portion of the
principal of any Original Issue Discount Securities shall have been accelerated
and declared due and payable pursuant to the provisions hereof, then, from and
after such declaration, unless such declaration has been rescinded and annulled,
the principal amount of such Original Issue Discount Securities shall be deemed,
for all purposes hereunder, to be such portion of the principal thereof as shall
be due and payable as a result of such acceleration, and payment of such portion
of the principal thereof as shall be due and payable as a result of such
acceleration, together with interest, if any, thereon and all other amounts
owing thereunder, shall constitute payment in full of such Original Issue
Discount Securities.
In case the Trustee shall have proceeded to enforce any right under this
Subordinated 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 Subordinated Securities of
such series (or of all the Subordinated Securities, as the case may be) shall be
restored respectively to their former positions and rights hereunder, and all
rights, remedies and powers of the Company and the Trustee and the Holders of
the Subordinated Securities of such series (or of all the Subordinated
Securities, as the case may be) shall continue as though no such proceedings had
been taken.
SECTION 6.02. Covenant of Company to Pay to Trustee Whole Amount Due on
---------------------------------------------------------
Subordinated Securities on Default in Payment of Interest or Principal. The
----------------------------------------------------------------------
Company covenants that:
38
(a) in case default shall be made in the payment of any installment of
interest on any of the Subordinated Securities of any series as and when the
same shall become due and payable and which payment has not been extended in
accordance with the provisions of a Supplemental Subordinated Indenture, and
such default shall have continued for a period of 30 days; or
(b) in case default shall be made in the payment of all or any part of
the principal of any of the Subordinated Securities of any series when the same
shall have become due and payable and which payment has not been extended in
accordance with the provisions of a Supplemental Subordinated Indenture,
whether at the Stated Maturity of such series or by any call for redemption or
by declaration of acceleration or otherwise; or
(c) in case default shall be made in the satisfaction of any sinking
fund obligation when and as such obligation becomes due and payable and which
payment has not been extended in accordance with the provisions of a
Supplemental Subordinated Indenture;
upon demand of the Trustee, the Company will pay to the Trustee, for
the benefit of the Holders of the Subordinated Securities of such series, the
whole amount that then shall have become due and payable on all such
Subordinated Securities of such series and such Coupons, for principal (and any
premium) and interest and for any overdue sinking fund payment together with
interest upon the overdue principal and installments of interest (to the extent
permitted by law) at the rate or rates of interest borne by or Yield to Maturity
(in the case of Original Issue Discount Subordinated Securities), or prescribed
therefor in, the Subordinated Securities of such series; and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expense of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due to the Trustee under Section 7.06.
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 proceedings to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor upon such
Subordinated Securities, and collect in the manner provided by law out of the
property of the Company or any other obligor upon such Subordinated Securities
wherever situated the moneys adjudged or decreed to be payable.
If an Event of Default with respect to Subordinated Securities of any
series occurs and is continuing, the Trustee may, in its discretion, proceed to
protect and enforce its rights and the rights of the Holders of Subordinated
Securities of such series by such appropriate judicial proceedings as the
Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Subordinated Indenture or in aid of the exercise of any power granted herein, or
to enforce any other proper remedy.
SECTION 6.03. Trustee May File Proofs of Claim. In case of the pendency
--------------------------------
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other similar judicial proceeding
relative to the Company or any other obligor
39
upon the Subordinated Securities or the property of the Company or of such other
obligor or their creditors, the Trustee (irrespective of whether the principal
of the Subordinated Securities of any series shall then be due and payable as
therein expressed or by declaration or otherwise and irrespective of whether the
Trustee shall have made any demand on the Company for the payment of overdue
principal or interest) shall be entitled and empowered, to the fullest extent
permitted by law, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of principal (and
premium, if any) and interest owing and unpaid in respect of the Subordinated
Securities (or, if the Subordinated Securities are Original Issue Discount
Subordinated Securities, such portion of the principal amount as may be
specified in the terms of such Subordinated Securities) and to file such other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel and any other
amounts due to the Trustee under Section 7.06) and of the Holders allowed in
such judicial proceeding; and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.06.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the
Subordinated Securities or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.04. Trustee May Enforce Claims Without Possession of
------------------------------------------------
Subordinated Securities. All rights of action and claims under this
-----------------------
Subordinated Indenture or the Subordinated Securities of any series or Coupons
appertaining to such Subordinated Securities may be prosecuted and enforced by
the Trustee to the fullest extent permitted by law without the possession of any
of the Subordinated Securities of any series or Coupons appertaining to such
Subordinated Securities, or the production thereof in any proceeding relating
thereto and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel and any other
amounts due to the Trustee under Section 7.06, be for the ratable benefit of the
Holders of the Subordinated Securities or Coupons in respect of which such
judgment has been recovered.
SECTION 6.05. Application of Moneys Collected by Trustee. Any moneys
------------------------------------------
collected by the Trustee pursuant to Article Six shall be applied in the order
following, at the date or dates fixed by the Trustee for the distribution of
such moneys, upon presentation of the several
40
Subordinated Securities or Coupons appertaining to such Subordinated 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 all amounts due to the Trustee under Section
7.06;
SECOND: In case the principal of the Outstanding Subordinated
Securities in respect of which moneys have been collected shall not have become
due and be unpaid, to the payment of any interest on such Subordinated
Securities, in the order of the maturity of the installments of such interest,
with interest upon the overdue installments of interest (so far as permitted by
law and to the extent that such interest has been collected by the Trustee at
the rate or rates of interest borne by or Yield to Maturity (in the case of
Original Issue Discount Subordinated Securities) of such Subordinated Securities
or prescribed therefor therein) such payments to be made ratably to the Persons
entitled thereto, without discrimination or preference;
THIRD: In case the principal of the Outstanding Subordinated
Securities in respect of which such moneys have been collected shall have become
due, by declaration or otherwise, to the payment of the whole amount then owing
and unpaid upon such Subordinated Securities for principal and interest, if any,
with interest on the overdue principal and any installments of interest (so far
as permitted by law and to the extent that such interest has been collected by
the Trustee) at the rate or rates of interest borne by or Yield to Maturity (in
the case of Original Issue Discount Subordinated Securities), or prescribed
therefor in, such Subordinated Securities; and in case such moneys shall be
insufficient to pay in full the whole amount so due and unpaid upon such
Subordinated Securities, then to the payment of such principal and interest or
Yield to Maturity, without preference or priority of principal over interest or
Yield to Maturity, or of interest or Yield to Maturity over principal, or of any
installment of interest over any other installment of interest, or of any
Subordinated Security over any other Subordinated Security, ratably to the
aggregate of such principal and accrued and unpaid interest or Yield to
Maturity; and
FOURTH: To the payment of the remainder, with appropriate interest,
to the Company or its successors or assigns, or to whomsoever may be lawfully
entitled to receive the same, or as a court of competent jurisdiction may
direct.
SECTION 6.06. Limitation on Suits by Holders of Subordinated Securities.
---------------------------------------------------------
No Holder of any Subordinated Security of any series or of any Coupon
appertaining thereto shall have any right by virtue or by availing of any
provision of this Subordinated Indenture to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Subordinated Indenture or for the appointment of a receiver or trustee, or for
any other remedy hereunder, unless: (1) such Holder previously shall have given
to the Trustee written notice of a continuing Event of Default with respect to
Subordinated Securities of that series, as hereinbefore provided; (2) the
Holders of not less than 25% in principal amount at maturity of the Subordinated
Securities of such series then Outstanding shall have made written request upon
the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder; (3) such Holder or Holders, as the case may be, shall have
offered to the Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in compliance with such request (including the
reasonable fees of counsel for the Trustee); (4) the Trustee, for 60 days after
its receipt of such
41
notice, request and offer of indemnity, shall have failed or refused to
institute any such action, suit or proceeding; and (5) no direction inconsistent
with such written request shall have been given to the Trustee by a majority in
principal amount at maturity of the Subordinated Securities of such series then
Outstanding pursuant to this Section 6.06; it being understood and intended, and
being expressly covenanted by the taker and Holder of every Subordinated
Security or Coupon with every other taker and Holder and the Trustee, that no
one or more Holders of Subordinated Securities of any series or Coupons
appertaining to such Subordinated Securities shall have any right in any manner
whatever by virtue, or by availing, of any provision of this Subordinated
Indenture to affect, disturb or prejudice the rights of the Holders of any other
of such Subordinated Securities or Coupons appertaining to such Subordinated
Securities, or to obtain or seek to obtain priority over or preference to any
other such Holder, or to enforce any right under this Subordinated Indenture,
except in the manner herein provided and for the equal, ratable and common
benefit of all Holders of Subordinated Securities of the applicable series and
Coupons appertaining to such Subordinated Securities. For the protection and
enforcement of the provisions of this Section 6.06, each and every Holder and
the Trustee shall be entitled to such relief as can be given either at law or in
equity.
Notwithstanding any other provisions in this Subordinated Indenture, the
right of any Holder of any Subordinated Security or Coupon to receive payment of
the principal of and interest on such Subordinated Security or Coupon on or
after the respective due dates expressed in such Subordinated Security (or, in
the case of redemption, on or after the date fixed for redemption), or to
institute suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
SECTION 6.07. Rights and Remedies Cumulative. All powers and remedies
------------------------------
given by this Article Six to the Trustee or to the Holders shall, to the extent
permitted by law, be deemed cumulative and not exclusive of any thereof or of
any other powers and remedies available to the Trustee or the Holders, by
judicial proceedings or otherwise, to enforce the performance or observance of
the covenants and agreements contained in this Subordinated Indenture, and no
delay or omission of the Trustee or of any Holder of any of the Subordinated
Securities or Coupons to exercise any right or power accruing upon any 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 6.06, every power and remedy
given by this Article Six or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as shall be deemed expedient, by the
Trustee or by the Holders. The assertion or employment of any right or remedy
hereunder or otherwise shall not prevent the concurrent assertion or employment
of any other appropriate right or remedy.
SECTION 6.08. Delay or Omission Not Waiver. No delay or omission of the
----------------------------
Trustee or of any Holder of any Subordinated Securities or Coupons to exercise
any right or remedy accruing upon any Event of Default shall impair any such
right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Subject to the provisions of Section 6.06, every right
and remedy given by this Article Six or by law to the Trustee or to the Holders
may be exercised from time to time, and as often as may be deemed expedient, by
the Trustee or by the Holders, as the case may be.
SECTION 6.09. Control by Holders; Waiver of Past Defaults. The Holders of
-------------------------------------------
a majority in principal amount at maturity of the Subordinated Securities of all
series (voting as one class)
42
at the time Outstanding (determined as provided in Section 8.04) shall have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred on
the Trustee; provided, however, that, (1) such direction shall not be in
conflict with any rule of law or with this Subordinated Indenture, expose it to
personal liability or be unduly prejudicial to the rights of Holders not parties
to such direction, and (2) the Trustee may take any other action deemed proper
by the Trustee which is not inconsistent with such direction by the Holders.
The Company may set a special record date for purposes of determining the
identity of the Holders of Subordinated Securities entitled to vote or consent
to any action by vote or consent authorized or permitted by this Section 6.09.
Such record date shall be the later of 15 days prior to the first solicitation
of such consent or the date of the most recent list of Holders furnished to the
Trustee pursuant to Section 5.01 of this Subordinated Indenture prior to such
solicitation.
The Holders of not less than a majority in principal amount at maturity of
the Subordinated Securities of any series at the time Outstanding (determined as
provided in Section 8.04) may, on behalf of the Holders of all the Subordinated
Securities of such series, waive any past Event of Default with respect to such
series and its consequences (subject to Section 6.02), except a continuing Event
of Default specified in Section 6.01(a), (b) or (c), or in respect of a covenant
or provision of this Subordinated Indenture which under Article Ten cannot be
modified or amended without the consent of the Holder of each Subordinated
Security so affected. Upon any such waiver, the Company, the Trustee and the
Holders of the Subordinated Securities of such series shall be restored to their
former positions and rights hereunder, respectively, and such Event of Default
shall be deemed to have been cured and not continuing for every purpose of this
Subordinated Indenture; but no such waiver shall extend to any subsequent or
other Event of Default or impair any right consequent thereon.
SECTION 6.10. Trustee to Give Notice of Defaults Known to it, but May
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Withhold in Certain Circumstances. The Trustee shall, within 90 days after the
---------------------------------
occurrence of a default with respect to the Subordinated Securities of any
series, give notice of all defaults with respect to that series known to the
Trustee (i) if any Unregistered Subordinated Securities of that series are then
Outstanding, to the Holders thereof, by publication at least once in an
Authorized Newspaper in the Borough of Manhattan, The City of New York and at
least once in an Authorized Newspaper in London (and, if required by Section
4.09, at least once in an Authorized Newspaper in Luxembourg) and (ii) to all
Holders of Subordinated Securities of such series in the manner and to the
extent provided in Section 313(c) of the Trust Indenture Act, unless in each
case such default(s) shall have been cured before the mailing or publication of
such notice (the term "default" for the purpose of this Section being hereby
defined to mean any event or condition which is, or with notice or lapse of time
or both would become, an Event of Default); provided, that, except in the case
of default in the payment of the principal of or interest on any of the
Subordinated Securities of such series, or in the payment of any sinking fund
installment on such series, the Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive committee, or a
trust committee of directors and/or Responsible Officers of the Trustee in good
faith determines that the withholding of such notice is in the interests of the
Subordinated Securityholders of such series.
43
SECTION 6.11. Requirement of an Undertaking to Pay Costs in Certain Suits
-----------------------------------------------------------
Under the Subordinated Indenture or Against the Trustee. All parties to this
-------------------------------------------------------
Subordinated Indenture agree, and each Holder of any Subordinated 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 Subordinated Indenture, or in any suit against the Trustee for
any action taken or omitted by it as Trustee, the filing by any party litigant
in such suit of an undertaking to pay the costs of such suit, and that such
court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, 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 6.11 shall not apply to any suit instituted
by the Trustee, to any suit instituted by any Holder of Subordinated Securities
of any series, or group of such Holders, holding in the aggregate more than ten
percent in principal amount at maturity of the Subordinated Securities of such
series Outstanding, or to any suit instituted by any Holder for the enforcement
of the payment of the principal of or any interest or premium on any
Subordinated Security, on or after the due date expressed in such Subordinated
Security or for such interest (or in the case of any redemption, on or after the
dated fixed for redemption).
SECTION 6.12. Waiver of Stay, or Extension Laws. The Company covenants
---------------------------------
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereinafter in force, which may affect the covenants or the performance of this
Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law and covenants that
they will not hinder, delay or impede the execution of any power herein granted
to the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
ARTICLE SEVEN
CONCERNING THE TRUSTEE
SECTION 7.01. Certain Duties and Responsibilities of Trustee.
----------------------------------------------
(a) Except during the continuance of an Event of Default with respect to
the Subordinated Securities of any series:
(1) the Trustee undertakes to perform, with respect to Subordinated
Securities of such series, such duties and only such duties as are specifically
set forth in this Subordinated Indenture, and no implied covenants or
obligations shall be read into this Subordinated Indenture against the Trustee;
and
(2) in the absence of bad faith on the part of the Trustee the Trustee may
with respect to Subordinated Securities of such series, 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 Subordinated Indenture; but in the case
of any such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee shall be under
a duty to examine the same to determine whether or not they conform to the
requirements of this Subordinated Indenture;
44
(b) In case an Event of Default with respect to Subordinated Securities of
any series has occurred and is continuing, the Trustee shall exercise, with
respect to Subordinated Securities of such series, such of the rights and powers
vested in it by this Subordinated Indenture, and use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his or her own affairs;
(c) No provision of this Subordinated 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, provided, however,
that:
(1) this subsection shall not be construed to limit the effect of
subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the Trustee
was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction of
the Holders of Subordinated Securities pursuant to Section 6.09 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 Subordinated Indenture with respect to Subordinated Securities of such
series; and
(4) none of the provisions contained in this Subordinated Indenture
shall require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers, if it shall have reasonable ground for
believing that the repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of this
Subordinated Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
SECTION 7.02. Certain Rights of Trustee. Except as otherwise provided in
-------------------------
Section 7.01:
(a) The Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, approval, bond, debenture,
note, coupon, other evidence of indebtness or other paper or document believed
by it to be genuine and to have been signed or presented by the proper party or
parties;
(b) Any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by a Company Order (unless other evidence
in respect thereof shall be herein specifically prescribed); and any resolution
of the Board of Directors shall be sufficiently evidenced to the Trustee by a
Board Resolution;
45
(c) Whenever in the administration of this Subordinated Indenture the
Trustee shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad faith on
its part, rely upon an Officers' Certificate;
(d) The Trustee may consult with counsel and the advice of such counsel or
any Opinion of Counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon;
(e) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Subordinated Indenture at the request, order or
direction of any of the Subordinated Securityholders of any series, pursuant to
this Subordinated Indenture, unless such Subordinated Securityholders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which may be incurred by it in compliance with such
request, order or direction;
(f) The Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, approval, bond,
debenture, note, coupon, other evidence of indebtedness or other paper or
document but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company personally or
by agent or attorney;
(g) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder; and
(h) The Trustee shall not be charged with knowledge of any Event of Default
with respect to the Subordinated Securities of any series for which it is acting
as Trustee unless either (1) a Responsible Officer of the Trustee assigned to
its Issuer Services department (or any successor division or department of the
Trustee) shall have actual knowledge of the Event of Default or (2) written
notice of such Event of Default shall have been given to the Trustee by the
Company, any other obligor on such Subordinated Securities or by any Holder of
such Subordinated Securities.
SECTION 7.03. Trustee Not Responsible for Recitals or Application of
------------------------------------------------------
Proceeds. The recitals contained herein and in the Subordinated Securities
--------
(other than the Trustee's certificate of authentication on the Subordinated
Securities) and in any Coupon shall be taken as the statements of the Company,
and the Trustee or any Authenticating Agent assumes no responsibility for the
correctness of the same. The Trustee makes no representations as to the
validity or sufficiency of this Subordinated Indenture or of the Subordinated
Securities or Coupons, except that the Trustee represents that is it duly
authorized to execute and deliver this Subordinated Indenture, authenticate the
Subordinated Securities and perform its obligations hereunder. The Trustee or
any Authenticating Agent shall not be accountable for the use or application by
the Company of any of the Subordinated Securities or of the proceeds thereof.
46
SECTION 7.04. Trustee May Own Subordinated Securities or Coupons. The
--------------------------------------------------
Trustee, any Authenticating Agent, any Paying Agent, registrar or any other
agent of the Company or of the Trustee, in its individual or any other capacity,
may become the owner or pledgee of Subordinated Securities and Coupons and,
subject to Sections 310(b) and 311 of the Trust Indenture Act, may otherwise
deal with the Company or an Affiliate of the Company with the same rights it
would have if it were not Trustee, Authenticating Agent, Paying Agent, registrar
or such other agent.
SECTION 7.05. Moneys Received by Trustee to be Held in Trust. Moneys held
----------------------------------------------
by the Trustee, in trust need not be segregated from other funds except to the
extent required by law. The Trustee shall be under no liability for interest on
any money received by it hereunder except as otherwise agreed with the Company.
SECTION 7.06. Trustee Entitled to Compensation, Reimbursement and
---------------------------------------------------
Indemnity. The Company agrees: (1) to pay to the Trustee from time to time
---------
reasonable compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of any express trust); (2) except as otherwise
expressly provided herein, to reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any provision of this Subordinated Indenture (including the
reasonable compensation and the expenses and disbursements of its agents,
counsel and of all Persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence or bad faith; and (3)
to indemnify the Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on the part of the
Trustee and arising out of or in connection with the acceptance or
administration of this trust, including the reasonable costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its duties. The obligations of the Company under this
Section to compensate the Trustee, to pay or reimburse the Trustee for expenses,
disbursements and advances and to indemnify and hold harmless the Trustee shall
constitute additional indebtedness hereunder and shall survive the satisfaction
and discharge of this Subordinated Indenture. Such additional indebtedness
shall be secured by a lien prior to that of the Subordinated Securities upon all
property and funds held or collected by the Trustee as such, except funds held
in trust for the payment of principal of or interest or redemption premium on
particular Subordinated Securities.
SECTION 7.07. Disqualification; Conflicting Interest. The Trustee shall
--------------------------------------
comply with the terms of Section 310(b) of the Trust Indenture Act.
SECTION 7.08. Requirements for Eligibility of Trustee. There shall always
---------------------------------------
be at least one Trustee hereunder that is a Person organized and doing business
as a bank or trust company under the laws of the United States of America or any
state thereof or of the District of Columbia, or any other Person permitted by
the Trust Indenture Act to act as a trustee under an indenture qualified under
the Trust Indenture Act and authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least $50,000,000, and
subject to supervision or examination by Federal, State or District of Columbia
authority. If such Person 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 Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. No obligor on the
47
Subordinated Securities or Person directly or indirectly controlling, controlled
by or under common control with such obligor shall serve as Trustee. In case at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 7.08, the Trustee shall resign immediately in the
manner and with the effect specified in this Article Seven.
SECTION 7.09. Resignation and Removal of Trustee; Appointment of
--------------------------------------------------
Successor.
(a) The Trustee may at any time resign with respect to the Subordinated
Securities of one or more series by giving written notice of resignation to the
Company. If the instruments of acceptance by a successor Trustee required by
Section 7.10 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee with
respect to the Subordinated Securities of such series.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with the provisions of Section
7.08 after written request therefor by the Company or by any Subordinated
Securityholder who has been a bona fide Holder of a Subordinated Security or
Subordinated Securities of the applicable series for at least six months; or
(2) the Trustee shall cease to be eligible in accordance with the
provisions of Section 7.08 and shall fail to resign after written request
therefor by the Company or by any such Subordinated Securityholder; or
(3) the Trustee shall become incapable of acting, or shall be adjudged
a bankrupt or insolvent, or a receiver of the Trustee or of its property shall
be appointed, or any public officer shall take charge or control of the Trustee
or of its property or affairs for the purpose of rehabilitation, conservation or
liquidation; or
(4) the Company shall determine that the Trustee has failed to perform
its obligations under this Subordinated Indenture in any material respect,
then, in any such case, the Company may remove the Trustee or, subject
to the provisions of Section 6.11, any Subordinated Securityholder who has been
a bona fide Holder of a Subordinated Security or Subordinated Securities of the
affected series for at least six months may, on such Person's behalf and on
behalf of all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee with respect to such series.
(c) The Holders of a majority in principal amount at maturity of the
Subordinated Securities Outstanding (determined as provided in Section 8.04) may
at any time by an Act of the Holders, remove the Trustee and appoint a successor
Trustee by written instrument or instruments signed by such Holders or their
attorneys-in-fact duly authorized, or by the affidavits of the permanent
chairman and secretary of a meeting of the Subordinated Securityholders
evidencing the vote upon a resolution or resolutions submitted thereto with
respect to such removal and appointment (as provided in Article Nine), and by
delivery thereof to the Trustee so removed, to the successor Trustee and to the
Company.
48
(d) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, with respect
to the Subordinated Securities of one or more series, the Company, authorized by
a Board Resolution, shall promptly appoint a successor Trustee or Trustees with
respect to the Subordinated Securities of that or those series (it being
understood that any such successor Trustee may be appointed with respect to the
Subordinated Securities of one or more or all of such series and that at any
time there shall be only one Trustee with respect to the Subordinated Securities
of any particular series) and shall comply with the applicable requirements of
Section 7.10. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Subordinated Securities of any series shall be appointed by an
Act of the Holders, the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment in accordance with the applicable requirements of
Section 7.10, become the successor Trustee with respect to the Subordinated
Securities of such series and to that extent supersede the successor Trustee
appointed by the Company. If no successor Trustee with respect to the
Subordinated Securities of any series shall have been so appointed by the
Company or the Holders of Subordinated Securities and accepted appointment in
the manner required by Section 7.10, any Holder of a Subordinated Security who
has been a bona fide Holder of a Subordinated Security of such series for at
least six months may, on behalf of such Person and all others similarly
situated, petition any court of competent jurisdiction for the appointment of a
successor Trustee with respect to the Subordinated Securities of such series.
SECTION 7.10. Acceptance of Appointment by Successor Trustee.
----------------------------------------------
(a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment. Thereupon the resignation or removal of
the retiring Trustee shall become effective and such successor Trustee, without
any further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or on the request of the successor Trustee, such retiring Trustee shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Trustee all the rights, powers and trusts of the retiring Trustee
and shall duly assign, transfer and deliver to such successor Trustee all
property and money held by such retiring Trustee hereunder; provided, that such
property and money shall continue to be subject to any lien in favor of the
retiring Trustee provided for in Section 7.06.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Subordinated Securities of one or more (but not all) series, the
Company, the retiring Trustee and each successor Trustee with respect to the
Subordinated Securities of one or more series shall execute and deliver a
Supplemental Subordinated Indenture wherein each successor Trustee shall accept
such appointment and which (1) shall contain such provisions as shall be
necessary or desirable to transfer and confirm to, and to vest in, each
successor Trustee all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Subordinated Securities of that or those series to
which the appointment of such successor Trustee relates, (2) if the retiring
Trustee is not retiring with respect to all Subordinated Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Subordinated Securities of that or those series as to which the
retiring Trustee is not retiring shall continue to be vested in the retiring
Trustee and (3) shall add
49
to or change any of the provisions of this Subordinated Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such Supplemental Subordinated Indenture shall constitute such Trustees co-
trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any or other such Trustee; and upon the execution and delivery
of such Supplemental Subordinated Indenture, the resignation or removal of the
retiring Trustee shall become effective to the extent provided therein and each
such successor Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Securities of that or those series to which the
appointment of such successor Trustee relates; but, on request of the Company or
on the request of any successor Trustee, such retiring Trustee shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder, subject nevertheless to its lien
provided for in Section 7.06, with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all such rights, powers and trusts referred to in
paragraph (a) or (b) of this Section, as the case may be.
(d) No successor trustee shall accept appointment as provided in this
Section 7.10 unless at the time of such acceptance such successor Trustee shall
be qualified under the provisions of Section 7.07 and eligible under the
provisions of Section 7.08.
(e) Upon acceptance of appointment by a successor Trustee as provided in
this Section 7.10, the Company shall give notice of the resignation of the
retiring Trustee and the appointment of the successor Trustee (a) if any
Unregistered Subordinated Securities of a series affected are then Outstanding,
to the Holders thereof by publication of such notice at least once in an
Authorized Newspaper in the Borough of Manhattan, The City of New York and at
least once in an Authorized Newspaper in London (and, if required by Section
4.09, at least once in an Authorized Newspaper in Luxembourg), (b) if any
Unregistered Subordinated Securities of a series affected are then Outstanding,
to the Holders thereof who have filed their names and addresses with the Trustee
pursuant to Section 313(c)(2) of the Trust Indenture Act, by mailing such notice
to such Holders at such addresses as were so furnished to the Trustee (and the
Trustee shall make such information available to the Company for such purpose)
and (c) to the Holders of Registered Subordinated Securities of each series
affected, by mailing such notice to such Holders at their addresses as they
shall appear on the Register. If the Company fails to give such notice within
ten days after acceptance of appointment by the successor Trustee, the successor
Trustee shall cause such notice to be given at the expense of the Company.
SECTION 7.11. Successor to Trustee by Merger, Consolidation or Succession
-----------------------------------------------------------
to Business. Any Person into which the Trustee may be merged or converted or
-----------
with which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any Person
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such Person
shall be qualified under the provisions of Section 7.07 and eligible under the
provisions
50
of Section 7.08, without the execution or filing of any paper or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Subordinated Indenture any of the Subordinated Securities
shall have been authenticated but not delivered, any such successor to the
Trustee may adopt the certificate of authentication of any predecessor Trustee,
and deliver such Subordinated Securities so authenticated; and in case at that
time any of the Subordinated Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Subordinated 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 Subordinated Securities or in this Subordinated 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 to authenticate Subordinated Securities in the name of any predecessor
Trustee shall apply only to its successor or successors by merger, conversion or
consolidation.
SECTION 7.12. Preferential Collection of Claims Against Company. If and
-------------------------------------------------
when the Trustee shall be or become a creditor of the Company (or any obligor
upon the Subordinated Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
SECTION 7.13. Appointment of Authenticating Agent. As long as any
-----------------------------------
Subordinated Securities of a series remain Outstanding, the Trustee may, by an
instrument in writing, appoint with the approval of the Company an
authenticating agent (the "Authenticating Agent") with respect to one or more
series of Subordinated Securities which shall be authorized to act on behalf of
the Trustee to authenticate Subordinated Securities of such series, including
Subordinated Securities issued upon exchange, registration of transfer, partial
redemption or pursuant to Section 2.09. Subordinated Securities of each such
series authenticated by such Authenticating Agent shall be entitled to the
benefits of this Subordinated Indenture and shall be valid and obligatory for
all purposes as if authenticated by the Trustee. Whenever reference is made in
this Subordinated Indenture to the authentication and delivery of Subordinated
Securities of any series by the Trustee or to the Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent for such series and
a certificate of authentication executed on behalf of the Trustee by such
Authenticating Agent. Each Authenticating Agent shall at all times be a Person
organized and doing business under the laws of the United States of America or
of any State or the District of Columbia, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
$45,000,000 (determined in the same manner as provided in Section 7.08) and
subject to supervision or examination by Federal or State authority.
Any Person into which any Authenticating Agent may be merged or converted,
or with which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which any Authenticating Agent shall be a party,
or any Person succeeding to the corporate agency business of any Authenticating
Agent, shall continue to be the Authenticating Agent with respect to all series
of Subordinated Securities for which it served as Authenticating Agent without
the execution or filing of any paper or any further act on the part of the
Trustee or such Authenticating Agent. Any Authenticating Agent may at any time,
and if it shall cease to be
51
eligible shall, resign by giving written notice of resignation to the Trustee
and to the Company. The Trustee may at any time terminate the agency of the
Authenticating Agent by giving written notice thereof to such Authenticating
Agent and the Company.
Upon receiving such a notice of resignation or upon such a termination, or
in case in any time any Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 7.12 with respect to one or more
series of Subordinated Securities, the Trustee may, by an instrument in writing,
appoint with the approval of the Company a successor Authenticating Agent and
the Company shall provide notice of such appointment to all Holders of
Subordinated Securities of such series in the manner and to the extent provided
in Section 13.02. 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. The Company agrees to pay to the Authenticating
Agent for such series from time to time reasonable compensation.
If an appointment is made with respect to one or more series pursuant to
this Section, the Subordinated Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternative certificate of authentication substantially in the following form:
This is one of the Subordinated Securities of the series designated therein
referred in the within-mentioned Subordinated Indenture.
HSBC Bank USA, as Trustee
By ________________________________________
As Authenticating Agent
By ________________________________________
Authorized Officer
Sections 7.02, 7.03, 7.04, 7.06, 7.09(b) and 8.03 shall be applicable to
any Authenticating Agent.
52
ARTICLE EIGHT
CONCERNING THE SUBORDINATED SECURITYHOLDERS
SECTION 8.01. Evidence of Action by Subordinated Securityholders. Whenever
--------------------------------------------------
in this Subordinated Indenture it is provided that the Holders of a specified
percentage in principal amount at maturity of the Subordinated Securities of any
or all series may take any action (including the making of any demand or
request, the giving of any notice, consent or waiver or the taking of any other
action), the fact that at the time of taking any such action the Holders of such
specified percentage have joined therein may be evidenced (a) by any instrument
or any number of instruments of similar tenor executed by such Subordinated
Securityholders in Person or by agent or proxy appointed in writing, or (b) by
the record of such Holders of Subordinated Securities voting in favor thereof at
any meeting of such Subordinated Securityholders duly called and held in
accordance with the provisions of Article Nine, or (c) by a combination of such
instrument or instruments and any such record of such a meeting of such
Subordinated Securityholders.
SECTION 8.02. Proof of Execution of Instruments and of Holding of
---------------------------------------------------
Subordinated Securities. Subject to the provisions of Sections 7.01, 7.02 and
-----------------------
9.05, proof of the execution of any instrument by a Subordinated Securityholder
or such Holder's agent or proxy and proof of the holding by any Person of any of
the Subordinated Securities shall be sufficient if made in the following manner:
(a) The fact and date of the execution by any such Person of any instrument
may be proved in any reasonable manner acceptable to the Trustee;
(b) The ownership of Subordinated Securities of any series (including
Registered Global Subordinated Securities) shall be proved by the Register of
such Subordinated Securities of such series, or by certificates of the
Subordinated Security registrar or registrars thereof.
The Trustee shall not be bound to recognize any Person as a Subordinated
Securityholder unless and until such Person's title to the Subordinated
Securities held by it is proved in the manner in this Article Eight provided.
The record of any Subordinated Securityholders' meeting shall be proved in
the manner provided in Section 9.06.
The Trustee may accept such other proof or require such additional proof of
any matter referred to in this Section 8.02 as it shall deem reasonable.
SECTION 8.03. Who May be Deemed Owners of Subordinated Securities. Prior
---------------------------------------------------
to due presentment for transfer of any Subordinated Security, the Company, the
Trustee and any agent of the Company or the Trustee may deem and treat the
Person in whose name such Subordinated Security shall be registered upon the
Register of Subordinated Securities of the series of which such Subordinated
Security is a part as the absolute owner of such Subordinated Security (whether
or not such Subordinated Security shall be overdue and notwithstanding any
notation of ownership or other writing thereon) for the purpose of receiving
payment of or on account of the principal of and interest, subject to the
provisions of this Subordinated Indenture, on such Subordinated Security and for
all other purposes; and neither the Company nor the Trustee nor
53
any agent of the Company or the Trustee shall be affected by any notice to the
contrary. All such payments so made to any such 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 of moneys payable upon
any such Subordinated Security. The Company, the Trustee and any agent of the
Company or the Trustee may treat the Holder of any Unregistered Subordinated
Security and the Holder of any Coupon as the absolute owner of such Unregistered
Subordinated Security or Coupon (whether or not such Unregistered Subordinated
Security or Coupon shall be overdue) for the purpose of receiving payment
thereof or on account thereof and for all other purposes and neither the
Company, the Trustee, nor any agent of the Company or the Trustee shall be
affected by any notice to the contrary. All such payments so made to any such
Person, or upon its 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 Unregistered Subordinated Security or Coupon.
No holder of any beneficial interest in any Registered Global Subordinated
Security held on its behalf by the Depository (or its nominee) shall have any
rights under this Subordinated Indenture with respect to such Registered Global
Subordinated Security or any Subordinated Security represented thereby, and the
Depository may be treated by the Company, the Trustee and any agent of the
Company or the Trustee as the owner of such Registered Global Subordinated
Security or any Subordinated Security represented thereby for all purposes
whatsoever. None of the Company, the Trustee, any Paying Agent or the registrar
will have any responsibility or liability for any aspect of the records relating
to or payments made on account of beneficial ownership interests of a Registered
Global Subordinated Security or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
SECTION 8.04. Subordinated Securities Owned by the Company or Controlled
----------------------------------------------------------
or Controlling Persons Disregarded for Certain Purposes. In determining whether
-------------------------------------------------------
the Holders of the requisite principal amount at maturity of Subordinated
Securities have concurred in any demand, direction, request, notice, vote,
consent, waiver or other action under this Subordinated Indenture, Subordinated
Securities which are owned by the Company or any other obligor on the
Subordinated Securities or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or any
other obligor on the Subordinated 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 demand, direction, request, notice, vote, consent, waiver or other
action, only Subordinated Securities which a Responsible Officer of the Trustee
assigned to its Corporate Trust Office knows are so owned shall be so
disregarded. Subordinated Securities so owned which have been pledged in good
faith may be regarded as Outstanding for the purposes of this Section 8.04, if
the pledgee shall establish to the satisfaction of the Trustee the pledgee's
right to vote such Subordinated Securities and that the pledgee is not a Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Company or any such other obligor.
Upon request of the Trustee, the Company shall furnish to the Trustee
promptly an Officers' Certificate listing and identifying all Subordinated
Securities, if any, known by the Company to be owned or held by or for the
account of the Company or any other obligor on the
54
Subordinated Securities or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or any
other obligor on the Subordinated Securities; and, subject to the provisions of
Section 7.01, the Trustee shall be entitled to accept such Officers' Certificate
as conclusive evidence of the facts therein set forth and of the fact that all
Subordinated Securities not listed therein are Outstanding for the purpose of
any such determination.
SECTION 8.05. Instruments Executed by Subordinated Securityholders Bind
---------------------------------------------------------
Future Holders. At any time prior to (but not after) the evidencing to the
--------------
Trustee, as provided in Section 8.01, of the taking of any action by the Holders
of the percentage in principal amount at maturity of the Subordinated Securities
specified in this Subordinated Indenture in connection with such action, any
Holder of a Subordinated Security which is shown by the evidence to be included
in the Subordinated Securities the Holders of which have consented to such
action may, by filing written notice with the Trustee at its Corporate Trust
Office and upon proof of holding as provided in Section 8.02, revoke such action
so far as concerns such Subordinated Security. Except as aforesaid, any such
action taken by the Holder of any Subordinated Security and any direction,
demand, request, notice, waiver, consent, vote or other action of the Holder of
any Subordinated Security which by any provisions of this Subordinated Indenture
is required or permitted to be given shall be conclusive and binding upon such
Holder and upon all future Holders and owners of such Subordinated Security, and
of any Subordinated Security issued in lieu thereof, irrespective of whether any
notation in regard thereto is made upon such Subordinated Security. Any action
taken by the Holders of the percentage in principal amount at maturity of the
Subordinated Securities of any or all series specified in this Subordinated
Indenture in connection with such action shall be conclusively binding upon the
Company, the Trustee and the Holders of all of the Subordinated Securities of
such series subject, however, to the provisions of Section 7.01.
ARTICLE NINE
SUBORDINATED SECURITYHOLDERS' MEETINGS
SECTION 9.01. Purposes for Which Meetings May be Called. A meeting of
-----------------------------------------
Holders of Subordinated Securities of any or all series may be called at any
time and from time to time pursuant to the provisions of this Article 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 Holders of Subordinated Securities of any or all series, as the case
may be, pursuant to any of the provisions of Article Six;
(b) to remove the Trustee and appoint a successor trustee pursuant to
the provisions of Article Seven;
(c) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 10.02; or
(d) to take any other action authorized to be taken by or on behalf of
the Holders of any specified principal amount at maturity of the Subordinated
Securities of any or all
55
series, as the case may be, under any other provision of this Subordinated
Indenture or under applicable law.
SECTION 9.02. Manner of Calling Meetings. The Trustee may at any time
--------------------------
call a meeting of Subordinated Securityholders to take any action specified in
Section 9.01, to be held at such time and at such place in The City of New York,
as the Trustee shall determine. Notice of every meeting of Subordinated
Securityholders, setting forth the time and place of such meeting and in general
terms the action proposed to be taken at such meeting, shall be given in the
manner provided in Section 13.12 not less than 20 nor more than 60 days prior to
the date fixed for the meeting.
SECTION 9.03. Call of Meeting by the Company or Subordinated
----------------------------------------------
Securityholders. In case at any time the Company pursuant to a Board
---------------
Resolution, or the Holders of not less than ten percent in principal amount at
maturity of the Subordinated Securities of any or all series, as the case may
be, then Outstanding, shall have requested the Trustee to call a meeting of
Holders of Subordinated Securities of any or all series, as the case may be, to
take any action authorized in Section 9.01 by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have given notice of such meeting within 20 days after receipt
of such request, then the Company or such Holders of Subordinated Securities in
the amount above specified may determine the time and place in either the City
and County of San Francisco, California or The City of New York, for such
meeting and may call such meeting to take any action authorized in Section 9.01,
by notice thereof as provided in Section 9.02.
SECTION 9.04. Who May Attend and Vote at Meetings. To be entitled to vote
-----------------------------------
at any meeting of Subordinated Securityholders of Subordinated Securities of any
series, a Person shall (a) be a Holder of one or more Outstanding Subordinated
Securities of such series; or (b) be a Person appointed by an instrument in
writing as proxy by such Holder of one or more Outstanding Subordinated
Securities of such series. The only Persons who shall be entitled to be present
or to speak at any meeting of Subordinated 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 9.05. Regulations May be Made by Trustee; Conduct of the Meeting;
-----------------------------------------------------------
Voting Rights; Adjournment. Notwithstanding any other provisions of this
--------------------------
Subordinated Indenture, the Trustee may make such reasonable regulations as it
may deem advisable for any meeting of Subordinated Securityholders of such
series, in regard to proof of the holding of Subordinated Securities of such
series 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. Except as
otherwise permitted or required by any such regulations, the holding of
Subordinated Securities shall be proved in the manner specified in Section 8.02.
and the appointment of any proxy shall be proved in the manner specified in said
Section 8.02; provided, however, that such regulations may provide that written
instruments appointing proxies regular on their face, may be presumed valid and
genuine without the proof hereinabove or in said Section 8.02 specified.
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 Subordinated
56
Securityholders as provided in Section 9.03, in which case the Company or the
Subordinated 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 a vote of the Persons entitled to
vote a majority in principal amount of the Outstanding Subordinated Securities
of such series represented at the meeting.
Subject to the provisions of Section 8.04, at any meeting each Subordinated
Securityholder or proxy shall be entitled to one vote for each $1,000 or $5,000
(or [Euro] 1,000 or [Euro] 5,000) principal amount (in the case of Original
Issue Discount Subordinated Securities, such principal amount shall be equal to
such portion of the principal amount as may be specified in the terms of such
series) of Subordinated Securities of such series held or represented by such
Holder; provided, however, that no vote shall be cast or counted at any meeting
in respect of any Subordinated 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 Subordinated
Securities held by such Person or instruments in writing as aforesaid duly
designating such Person as the Person to vote on behalf of other Subordinated
Securityholders. Any meeting of Subordinated Securityholders duly called
pursuant to the provisions of Section 9.02 or 9.03 at which a quorum is present
may be adjourned from time to time, and the meeting may be held so adjourned
without further notice.
At any meeting of Subordinated Securityholders of such series, the presence
of Persons holding or representing Subordinated Securities of such series in
principal amount at maturity sufficient to take action on the business for the
transaction of which such meeting was called shall constitute a quorum, but, if
less than a quorum is present, the Persons holding or representing a majority in
principal amount at maturity of the Subordinated Securities represented at the
meeting may adjourn such meeting with the same effect, for all intents and
purposes, as though a quorum had been present.
SECTION 9.06. Manner of Voting at Meetings and Record to be Kept. The vote
--------------------------------------------------
upon any resolution submitted to any meeting of Subordinated Securityholders of
such series shall be by written ballots on which shall be subscribed the
signatures of the Holders of Subordinated Securities of such series or of their
representatives by proxy and the principal amount or principal amounts at
maturity of the Subordinated 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 duplicate of all votes cast at the meeting. A record in duplicate of
the proceedings of each meeting of Subordinated Securityholders of such series
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 9.02. The record shall show the
principal amount or principal amounts at maturity of the Subordinated 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 copy thereof shall be delivered to the Company and the other to
the Trustee to be preserved by the Trustee.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
57
SECTION 9.07. Exercise of Rights of Trustee and Subordinated
----------------------------------------------
Securityholders Not to be Hindered or Delayed. Nothing in this Article Nine
---------------------------------------------
contained shall be deemed or construed to authorize or permit, by reason of any
call of a meeting of Subordinated Securityholders of any series or any rights
expressly or impliedly conferred hereunder to make such call, any hindrances or
delay in the exercise of any right or rights conferred upon or reserved to the
Trustee or to the Subordinated Securityholders of any series under any of the
provisions of this Subordinated Indenture or of the Subordinated Securities.
ARTICLE TEN
SUPPLEMENTAL SUBORDINATED INDENTURES
SECTION 10.01. Purposes for Which Supplemental Subordinated Indentures May
-----------------------------------------------------------
be Entered into Without Consent of Subordinated Securityholders. Without the
---------------------------------------------------------------
consent of the Holders of any Subordinated Securities, the Company, when
authorized by a Board Resolution, and the Trustee may from time to time and at
any time enter into one or more subordinated indentures supplemental hereto
(which shall comply with the provisions of the Trust Indenture Act as then in
effect) for one or more of the following purposes:
(a) to convey, transfer, assign, mortgage or pledge to the Trustee as
security for the Subordinated Securities of one or more series any property or
assets;
(b) to evidence the succession of another Company to the Company or
successive successions and the assumption by the successor Company of the
covenants, agreements and obligations of the Company herein and in the
Subordinated Securities and Coupons;
(c) to add to the covenants of the Company for the benefit of the Holders
of all or any series of Subordinated Securities or Coupons (and if such
covenants are to be for the benefit of less than all series of Subordinated
Securities, stating that such covenants are expressly being included solely for
the benefit of such series), and to make the occurrence, or the occurrence and
continuance, of a default in any such additional covenants an Event of Default
permitting the enforcement of all or any of the several remedies provided in
this Subordinated Indenture as herein set forth; provided, however, that in
respect to any such additional covenant, such Supplemental Subordinated
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;
(d) to add or change any of the provisions of this Subordinated Indenture
to such extent as shall be necessary to facilitate the issuance of Subordinated
Securities in (i) global form or (ii) bearer form, registerable or not
registerable as to principal or principal and interest, and with or without
coupons;
(e) to change or eliminate any of the provisions of this Subordinated
Indenture; provided, however, that any such change or elimination shall become
effective only when there is no Subordinated Security of any series Outstanding
created prior to the execution of such Supplemental Subordinated Indenture which
is entitled to the benefit of such provision;
58
(f) to establish the form or terms of Subordinated Securities of any series
or the Coupons appertaining to such Subordinated Securities as permitted by
Sections 2.01 and 2.03;
(g) to evidence and provide for the acceptance of appointment hereunder by
a successor Trustee with respect to the Subordinated Securities of one or more
series, to contain such provisions as shall be deemed necessary or desirable to
confirm that all the rights, powers, trusts and duties of the predecessor
Trustee with respect to the Subordinated Securities of any series as to which
the predecessor Trustee is not retiring shall continue to be vested in the
predecessor Trustee, and to add to or change any of the provisions of this
Subordinated 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 7.10; and
(h) to cure any ambiguity or to correct or supplement any provisions
contained herein or in any Supplemental Subordinated Indenture which may be
defective or inconsistent with any other provision contained herein or in any
Supplemental Subordinated Indenture, or to make such other provisions in regard
to matters or questions arising under this Subordinated Indenture or any
Supplemental Subordinated Indenture; provided that such other provisions shall
not be inconsistent with the provisions of this Subordinated Indenture and shall
not adversely affect the interests of the Holders of the Subordinated Securities
of any series or related Coupons.
SECTION 10.02. Modification of Subordinated Indenture With Consent of
------------------------------------------------------
Holders of Subordinated Securities. With the consent (evidenced as provided in
----------------------------------
Section 8.01) of the Holders of not less than a majority in principal amount at
maturity of the Subordinated Securities of all series at the time Outstanding
(determined as provided in Section 8.04) affected by such Supplemental
Subordinated Indenture (voting as one class), the Company, when authorized by a
Board Resolution (which Board Resolution may provide general terms or parameters
for such action and may provide that the special terms of such action may be
determined in accordance with or pursuant to a Company Order), and the Trustee
may from time to time and at any time enter into an indenture or indentures
supplemental hereto (which shall comply with the provisions of the Trust
Indenture Act as then in effect) for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Subordinated
Indenture or of any Supplemental Subordinated Indenture or of modifying in any
manner the rights of the Holders of the Subordinated Securities of each such
series or the Coupons appertaining to such Subordinated Securities; provided,
however, that no such Supplemental Subordinated Indenture shall, without the
consent of the Holders of each Outstanding Subordinated Security or Coupons
affect thereby:
(a) change the Stated Maturity of the principal of, or any installment of
principal of or interest on, any Subordinated Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon the
redemption thereof, or reduce the amount of the principal of an Original Issue
Discount Subordinated Security or any other Subordinated Security which would be
due and payable upon a declaration of acceleration of the Stated Maturity
thereof pursuant to Section 6.01, or change any place of payment where, or the
coin or currency in which, any Subordinated Security or any premium or interest
thereon is payable, or impair the right to institute suit for the enforcement of
any such payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the date fixed for redemption), or modify the provisions
of this Subordinated Indenture with respect to this subordination of the
Subordinated Securities in a manner adverse to the Holders, or
59
(b) Reduce the percentage in principal amount at maturity of the
Outstanding Subordinated Securities the consent of the Holders of which is
required for any such Supplemental Subordinated Indenture, or the consent of the
Holders of which is required for any waiver (of compliance with certain
provisions of this Subordinated Indenture or certain defaults hereunder and
their consequences) provided for in this Subordinated Indenture, or
(c) Change the time of payment or reduce the amount of any minimum sinking
account or fund payment, or
(d) Modify any of the provisions of this Section 10.02, except to increase
any such percentage or to provide that certain other provisions of this
Subordinated Indenture cannot be modified or waived without the consent of the
Holder of each Subordinated Security affected thereby.
A Supplemental Subordinated Indenture which changes or eliminates any
covenant or other provision of this Subordinated Indenture which has expressly
been included solely for the benefit of one or more particular series of
Subordinated Securities, or which modifies the rights of Holders of Subordinated
Securities of such series, or of Coupons appertaining to such Subordinated
Securities, with respect to such covenant or provision, shall be deemed not to
affect the rights under this Subordinated Indenture of the Holders of
Subordinated Securities of any other series or of the Coupons appertaining to
such Subordinated Securities.
Upon the written request of the Company, accompanied by a copy of a Board
Resolution (which resolution may provide general terms or parameters for such
action and may provide that the specific terms of such action may be determined
in accordance with or pursuant to a Company Order) certified by the Secretary or
an Assistant Secretary of the Company authorizing the execution and delivery of
any such Supplemental Subordinated Indenture, and upon the filing with the
Trustee of evidence of the consent of the Holders of the Subordinated Securities
as aforesaid and other documents, if any, required by Section 8.01, the Trustee
shall join with the Company in the execution of such Supplemental Subordinated
Indenture unless such Supplemental Subordinated Indenture affects the Trustee's
own rights, duties, liabilities or immunities under this Subordinated Indenture
or otherwise, in which case the Trustee may, in its discretion, but shall not be
obligated to, enter into such Supplemental Subordinated Indenture.
It shall not be necessary for the consent of the Securityholders under this
Section to approve the particular form of any proposed Supplemental Subordinated
Indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution by the Company and the Trustee of any
Supplemental Subordinated Indenture pursuant to the provisions to this Section,
the Company shall give notice thereof to the Holders in the manner set forth in
Section 13.12.
SECTION 10.03. Effect of Supplemental Subordinated Indentures. Upon the
----------------------------------------------
execution of any Supplemental Subordinated Indenture pursuant to the provisions
of this Article Ten, this Subordinated Indenture shall be and be deemed to be
modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this
Subordinated Indenture of the Trustee, the Company and the Holders of
Subordinated Securities shall thereafter be determined, exercised and enforced
hereunder subject in all respects
60
to such modifications and amendments, and all the terms and conditions of any
such Supplemental Subordinated Indenture shall be and be deemed to be part of
the terms and conditions of this Subordinated Indenture for any and all
purposes.
In executing or accepting the additional trusts created by any Supplemental
Subordinated Indenture permitted by this Article or the modification thereby of
the trusts created by this Subordinated Indenture, the Trustee shall be entitled
to receive, and subject to Section 315 of the Trust Indenture Act shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such Supplemental Subordinated Indenture is authorized or permitted by this
Subordinated Indenture, the Supplemental Subordinated Indenture complies with
the provisions of this Article Ten and that the Subordinated Securities affected
by the Supplemental Subordinated Indenture, when such Subordinated Securities
are authenticated and delivered by the Trustee and executed and issued by the
Company in the manner and subject to any conditions specified in such Opinion of
Counsel, will be valid and binding obligations of the Company, except as any
rights thereunder may be limited by bankruptcy, insolvency and other similar
laws affecting the enforcement of creditors' rights generally and by general
equity principles.
SECTION 10.04. Subordinated Securities May Bear Notation of Changes by
-------------------------------------------------------
Supplemental Subordinated Indentures. Subordinated Securities authenticated and
------------------------------------
delivered after the execution of any Supplemental Subordinated Indenture
pursuant to the provisions of this Article Ten, or after any action taken at a
Subordinated Securityholders' meeting pursuant to Article Nine, may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such Supplemental Subordinated Indenture or as to
any action taken at any such meeting. If the Company or the Trustee shall so
determine, new Subordinated Securities so modified as to conform, in the opinion
of the Trustee and the Company, to any modification of this Subordinated
Indenture contained in any such Supplemental Subordinated Indenture may be
prepared and executed by the Company, authenticated by the Trustee and delivered
in exchange for the Subordinated Securities then Outstanding.
ARTICLE ELEVEN
DISCHARGE; DEFEASANCE
SECTION 11.01. Satisfaction and Discharge of Subordinated Indenture.
----------------------------------------------------
(A) If at any time (i) the Company shall have paid or caused to be
paid the principal of and interest on all the Subordinated Securities of any
series Outstanding hereunder and all unmatured Coupons appertaining thereto
(other than Subordinated Securities of such series and Coupons appertaining
thereto which have been destroyed, lost or stolen and which have been replaced
or paid as provided in Section 2.09) as and when the same shall have become due
and payable, or (ii) the Company shall have delivered to the Trustee for
cancellation all Subordinated Securities of any series theretofore authenticated
and all unmatured Coupons appertaining thereto (other than any Subordinated
Securities of such series and Coupons appertaining thereto which shall have been
destroyed, lost or stolen and which shall have been replaced or paid as provided
in Section 2.09) or (iii) in the case of any series of Subordinated
61
Securities where the exact amount (including the currency of payment) of
principal of and interest due on which can be determined at the time of making
the deposit referred to in clause (b) below, (a) all the Subordinated Securities
of such series and all unmatured Coupons appertaining thereto not theretofore
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 (b) the Company shall have
irrevocably deposited or caused to be deposited with the Trustee as trust funds
in trust the entire amount in (i) cash (other than moneys repaid by the Trustee
or any Paying Agent to the Company in accordance with Section 11.04), (ii) in
the case of any series of Subordinated Securities the payments on which may only
be made in United States Dollars, direct obligations of the United States of
America, backed by its full faith and credit ("U.S. Government Obligations"),
maturing as to principal and interest at such times and in such amounts as will
insure the availability of cash sufficient to pay at such maturity or upon such
redemption, as the case may be, or (iii) a combination thereof, sufficient, in
the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, to pay
(a) the principal and interest on all Subordinated Securities of such series and
Coupons appertaining thereto on each date that such principal or interest is due
and payable and (b) any mandatory sinking fund payments on the dates on which
such payments are due and payable in accordance with the terms of the
Subordinated Indenture and the Subordinated Securities of such series; (x) the
principal and interest on all Subordinated Securities of such series and Coupons
appertaining thereto on each date that such principal or interest is due and
payable and (y) any mandatory sinking fund payments on the dates on which such
payments are due and payable in accordance with the terms of the Subordinated
Indenture and the Subordinated Securities of such series; and if, in any such
case, the Company shall also pay or cause to be paid all other sums payable
hereunder by the Company and the Company has delivered to the Trustee 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 Subordinated Indenture have been satisfied, then this
Subordinated Indenture shall cease to be of further effect (except as to (i)
rights of registration of transfer and exchange of Subordinated Securities of
such series and of Coupons appertaining thereto and the Company's right of
optional redemption, if any, (ii) substitution of mutilated, defaced, destroyed,
lost or stolen Subordinated Securities or Coupons, (iii) rights of Holders of
Subordinated Securities and Coupons appertaining thereto to receive payments of
principal thereof and interest thereon, upon the original stated due dates
therefore (but not upon acceleration), and remaining rights of the Holders to
receive mandatory sinking fund payments, if any, (iv) any optional redemption
rights of such series of Subordinated Securities to the extent to be exercised
to make such call for redemption within one year, (v) the rights of the Holders
of Subordinated Securities of such series and Coupons appertaining thereto as
beneficiaries hereof with respect to the property so deposited with the Trustee
payable to all or any of them, and (vi) the obligations of the Company under
Section 4.03) and the Trustee, on written demand of the Company and at the cost
and expense of the Company, shall execute proper instruments acknowledging such
satisfaction of and discharging this Subordinated Indenture; provided, that the
rights of Holders of the Subordinated Securities and Coupons to receive amounts
in respect of principal of and interest on the Subordinated Securities and
Coupons held by them shall not be delayed longer than required by then
applicable mandatory rules or policies of any securities exchange or automated
quotation system upon which the Subordinated Securities are listed. The Company
agrees to reimburse the Trustee for any costs or expenses thereafter reasonably
and properly incurred and to compensate the Trustee for any services thereafter
62
reasonably and properly rendered by the Trustee in connection with this
Subordinated Indenture or the Subordinated Securities of such series.
Notwithstanding the satisfaction and discharge of this Subordinated
Indenture, the obligations of the Company to the Trustee under Section 7.06
shall survive.
(B) The following provisions shall apply to the Subordinated
Securities of each series unless specifically otherwise provided in an Officers'
Certificate or Supplemental Subordinated Indenture provided pursuant to Section
2.03. In addition to discharge of the Subordinated Indenture pursuant to the
next preceding paragraph, in the case of any series of Subordinated Securities
the exact amounts (including the currency of payment) of principal of and
interest due on which can be determined at the time of making the deposit
referred to in clause (a) below, the Company shall be deemed to have paid and
discharged the entire indebtedness on all the Subordinated Securities of such a
series and the Coupons appertaining thereto on the date of the deposit referred
to in clause (a) below, and the provisions of this Subordinated Indenture with
respect to the Subordinated Securities of such series and Coupons appertaining
thereto shall no longer be in effect (except as to (i) rights of registration of
transfer and exchange of Subordinated Securities of such series and of Coupons
appertaining thereto and the Company's right of optional redemption, if any,
(ii) substitution of mutilated, defaced, destroyed, lost or stolen Subordinated
Securities or Coupons, (iii) rights of Holders of Subordinated Securities and
Coupons appertaining thereto to receive payments of principal thereof and
interest thereon, upon the original stated due dates therefor (but not upon
acceleration), and remaining rights of the Holders to receive mandatory sinking
fund payments, if any, (iv) any optional redemption rights of such series of
Subordinated Securities to the extent to be exercised to make such call for
redemption within one year, (v) the rights of the Holders of Subordinated
Securities of such series and Coupons appertaining thereto as beneficiaries
hereof with respect to the property so deposited with the Trustee payable to all
or any of them and (vi) the obligations of the Company under Section 4.03) and
the Trustee, at the expense of the Company, shall at the Company's written
request, execute proper instruments acknowledging the same, if
(a) with reference to this provision the Company has irrevocably
deposited or caused to be irrevocably deposited with the Trustee in trust,
specifically pledged as security for, and dedicated solely to, the benefit
of the Holders of the Subordinated Securities of such series and Coupons
appertaining thereto (i) cash in an amount, or (ii) in the case of any
series of Subordinated Securities the payments on which may only be made in
United States Dollars, U.S. Government Obligations, maturing as to
principal and interest at such times and in such amounts as will insure the
availability of cash or (iii) a combination thereof, sufficient, in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, to
pay (a) the principal and interest on all Subordinated Securities of such
series and Coupons appertaining thereto on each date that such principal or
interest is due and payable and (b) any mandatory sinking fund payments on
the dates on which such payments are due and payable in accordance with the
terms of the Subordinated Indenture and the Subordinated Securities of such
series;
63
(b) such deposit will not result in a breach or violation of, or
constitute a default under, any agreement or instrument to which the
Company is a party or by which it is bound;
(c) the Company has delivered to the Trustee an Opinion of Counsel
based on the fact that (x) the Company has received from, or there has been
published by, the IRS a ruling or (y) since the date hereof, there has been
a change in the applicable Federal income tax law, in either case to the
effect that, and such opinion shall confirm that, the Holders of the
Subordinated Securities of such series and Coupons appertaining thereto
will not recognize income, gain or loss for United States Federal income
tax purposes as a result of such deposit, defeasance and discharge and will
be subject to United States Federal income tax on the same amount and in
the same manner and at the same times, as would have been the case if such
deposit, defeasance and discharge had not occurred; and
(d) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
provided for relating to the defeasance contemplated by this provision have
been complied with.
(C) The Company shall be released from its obligations under Sections
4.02 and unless otherwise provided for in the Officers' Certificate or
Supplemental Subordinated Indenture establishing such series of Subordinated
Securities, from all covenants and other obligations referred to in Section
2.03(18) or 2.03(20) with respect to such series of Subordinated Securities, and
any Coupons appertaining thereto, Outstanding on and after the date the
conditions set forth below are satisfied (hereinafter, "covenant defeasance").
For this purpose, such covenant defeasance means that, with respect to the
Outstanding Subordinated Securities of any series, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in such Sections, whether directly or indirectly by reason
of any reference elsewhere herein to such Section or by reason of any reference
in such Section to any other provision herein or in any other document and such
omission to comply shall not constitute an Event of Default under Section 6.01,
but the remainder of this Subordinated Indenture and such Subordinated
Securities and Coupons shall be unaffected thereby. The following shall be the
conditions to application of this subsection C of this Section 11.01:
(a) The Company has irrevocably deposited or caused to be deposited
with the Trustee in trust for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the benefit
of the holders of the Subordinated Securities of such series and coupons
appertaining thereto, (i) cash in an amount, or (ii) in the case of any
series of Subordinated Securities the payments on which may only be made in
United States Dollars, U.S. Government Obligations maturing as to principal
and interest at such times and in such amounts as will insure the
availability of cash or (iii) a combination thereof, sufficient, in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, to
pay (a) the principal and interest on all Subordinated Securities of such
series and Coupons appertaining thereof and (b) any mandatory sinking fund
payments on the day on which such payments are due and payable in
accordance with the terms of the Subordinated Indenture and the
Subordinated Securities of such series;
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(b) No Event of Default or event which with notice or lapse of time or
both would become an Event of Default with respect to the Subordinated
Securities shall have occurred and be continuing on the date of such
deposit;
(c) Such covenant defeasance shall not cause the Trustee to have a
conflicting interest for purposes of the Trust Indenture Act with respect
to any securities of the Company;
(d) Such covenant defeasance shall not result in a breach or violation
of, or constitute a default under, this Subordinated Indenture or any other
agreement or instrument to which the Company is a party or by which it is
bound;
(e) Such covenant defeasance shall not cause any Subordinated
Securities then listed on any registered national securities exchange under
the Exchange Act to be delisted;
(f) The Company shall have delivered to the Trustee an Officers'
Certificate and Opinion of Counsel to the effect that the Holders of the
Subordinated Securities of such series and Coupons appertaining thereto
will not recognize income, gain or loss for United States Federal income
tax purposes as a result of such covenant defeasance and will be subject to
United States Federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such covenant
defeasance had not occurred; and
(g) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to the covenant defeasance contemplated by
this provision have been complied with.
SECTION 11.02. Application by Trustee of Funds Deposited for Payment of
--------------------------------------------------------
Subordinated Securities. Subject to Section 11.04, all moneys deposited with
-----------------------
the Trustee (or other trustee) pursuant to Section 11.01 shall be held in trust
and applied by it to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent), to the Holders of the
particular Subordinated Securities of such series and of Coupons appertaining
thereto for the payment or redemption of which such moneys have been deposited
with the Trustee, of all sums due and to become due thereon for principal and
interest; but such money need not be segregated from other funds except to the
extent required by law.
SECTION 11.03. Repayment of Moneys Held by Paying Agent. In connection
----------------------------------------
with the satisfaction and discharge of this Subordinated Indenture with respect
to Subordinated Securities of any series, all moneys then held by any Paying
Agent under the provisions of this Subordinated Indenture with respect to such
series of Subordinated Securities shall, upon written demand of the Company, be
repaid to it or paid to the Trustee, and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
SECTION 11.04. Return of Moneys Held by Trustee and Paying Agent Unclaimed
-----------------------------------------------------------
for Two Years. Any moneys deposited with or paid to the Trustee or any Paying
-------------
Agent for the payment of the principal of and any premium and interest on any
Subordinated Security and any series of Coupons attached thereto and not so
applied but remaining unclaimed for two years after such principal of and any
premium and interest has become due and payable shall be paid to
65
the Company on Company Order and the Holder of such Subordinated Security of
such series and of any Coupons appertaining thereto shall thereafter look only
to the Company for any payment which such Holder may be entitled to collect and
all liability of the Trustee and such Paying Agent with respect to such moneys
shall thereupon cease.
SECTION 11.05. Indemnity for U.S. Government of Obligations. The Company
--------------------------------------------
shall pay and indemnify the Trustee against any tax, fee or other charge imposed
on or assessed against the U.S. Government Obligations deposited pursuant to
Section 11.01 or the principal or interest received in respect of such
obligations.
ARTICLE TWELVE
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
AND DIRECTORS
SECTION 12.01. Incorporators, Stockholders, Officers and Directors of
------------------------------------------------------
Company Exempt From Individual Liability. No recourse under or upon any
----------------------------------------
obligation, covenant or agreement of this Subordinated Indenture, or of any
Subordinated Security, or for any claim based thereon or otherwise in respect
thereof, shall be had against any incorporator, stockholder, officer or
director, as such, past, present or future, of the Company, either directly or
through 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 this Subordinated Indenture and the obligations issued
hereunder are solely corporate obligations, and that no personal liability
whatever shall attach to, or is or shall be incurred by, the incorporators,
stockholders, officers or directors, as such, of the Company because of the
creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Subordinated Indenture or
in any of the Subordinated Securities or implied therefrom; and that any and all
such personal liability of every name and nature, either at common law or in
equity or by constitution or statute, of, and any and all such rights and claims
against, every such incorporator, stockholder, officer or director, as such,
because of the creation of the indebtedness hereby authorized, or under or by
reason of the obligations, covenants or agreements contained in this
Subordinated Indenture or in any of the Subordinated Securities or implied
therefrom are hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Subordinated Indenture and the issue of
such Subordinated Securities.
ARTICLE THIRTEEN
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors and Assigns of the Company bound by Subordinated
-----------------------------------------------------------
Indenture. All the covenants, stipulations, promises and agreements in this
---------
Subordinated Indenture contained by or on behalf of the Company shall bind its
successors and assigns, whether so expressed or not.
SECTION 13.02. Notices; Effectiveness. Any request, authorization,
----------------------
direction, consent, election, waiver, notice, demand or other document which by
any provision of this Subordinated Indenture is required or permitted to be
given or served to or on the
66
Trustee or to or on the Depository shall be sufficient for every purpose
hereunder if in writing and electronically communicated or hand delivered or
sent by overnight courier or sent by facsimile transmission (followed by first-
class postage prepaid mail), addressed to the relevant party as provided in this
Section 13.02.
All communications intended for the Company shall be sent to:
Exodus Communications, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
All communications intended for the Trustee shall be sent to:
HSBC Bank USA
▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇/▇▇/ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
or at any other address of which any of the foregoing shall have notified the
others in any manner prescribed in this Section 13.02.
For all purposes of this Subordinated Indenture, a notice or communication
will be deemed effective:
(a) if delivered by hand or sent by overnight courier, on the day it is
delivered; provided that, if (i) that day is not a Business Day in the city
specified (a "Local Business Day") in the address for notice provided by the
recipient or (ii) delivered after the close of business on a Local Business Day,
then such notice or communication will be deemed effective on the next
succeeding Local Business Day; or
(b) if sent by facsimile transmission, on the date transmitted; provided
that, oral or written confirmation of receipt must be obtained by the sender
unless the date of transmission and confirmation is not a Local Business Day, in
which case, such notice or communication will be deemed effective on the next
succeeding Local Business Day.
Any request, authorization, direction, consent, election, waiver notice,
demand or other document made upon, furnished to, filed with, given or served to
or upon the Trustee of a series of Subordinated Securities by any Holder of a
Subordinated Security of such series or by the Company shall be sufficient for
every purpose hereunder, if given, made, furnished, filed or served in writing
at the Corporate Trust Office in accordance with the provisions of this Section
13.02.
Any request, authorization, direction, consent, election, waiver, notice,
demand or other document made upon, furnished to, filed with, given or served
upon the Depository shall be sufficient, for every purpose herender, if given
given or served in writing in accordance with the
67
provisions of this Section 13.02 at the address shown for such Depository in the
Register or at such other address as the Depository shall have provided for
purposes of notice.
SECTION 13.03. Compliance Certificates and Opinions. Upon any request or
------------------------------------
application by the Company to the Trustee to take any action under any of the
provisions of this Subordinated Indenture, the Company shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if any,
provided for in this Subordinated 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 in
the case of any such request or application as to which the furnishing of such
documents is specifically required by any provision of this Subordinated
Indenture relating to such particular request or application, no additional
certificate or opinion need be furnished.
Each certificate or opinion delivered to the Trustee with respect to
compliance with a condition or covenant provided for in this Subordinated
Indenture (other than a certificate provided pursuant to Section 5.03(d)), shall
include (a) a statement that each Person making such certificate or opinion has
read such covenant or condition and the definitions herein 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 each such Person, he or she
has made such examination or investigation as is necessary to enable such Person
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 each such Person, such condition or covenant has been complied with.
Any certificate, statement or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of
or representations by counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate, statements or opinion or
representations with respect to the matters upon which such certificate,
statement or opinion may be based as aforesaid are erroneous. Any certificate
or Opinion of Counsel may be based, insofar as it relates to factual matters,
upon the certificate, statement or opinion of or representations by an officer
or officers of the Company stating that the information with respect to such
factual matters is in the possession of the Company, unless such counsel knows,
or in the exercise of reasonable care should know, that the certificate,
statement or opinion or representations with respect to the matters are
erroneous.
Any certificate, statement or opinion of an officer of the Company or of
counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants, unless such officer or counsel, as the case may be, knows, or in
the exercise of reasonable care should know, that the certificate, statement or
opinion or representations with respect to the accounting matters upon which his
or her certificate or opinion may be based as aforesaid are erroneous. Any
certificate or opinion of any firm of independent public accountants filed with
the Trustee shall contain a statement that such firm is independent.
SECTION 13.04. Days on Which Payment to be Made, Notice Given or Other
-------------------------------------------------------
Action Taken. If any date on which a payment is to be made, a notice is to be
------------
given or other action is to be taken hereunder is not a Business Day in the
municipality in which the payment, notice or other action is to be made, given
or taken, then such payment, notice or other action shall be
68
made, given or taken on the next succeeding Business Day in such municipality,
and, in the case of any payment, no interest shall accrue for the delay.
SECTION 13.05. Provisions Required by Trust Indenture Act to Control. If
-----------------------------------------------------
and to the extent that any provision of this Subordinated Indenture limits,
qualifies or conflicts with another provision which is required or deemed to be
included in this Subordinated Indenture by any of the provisions of the Trust
Indenture Act, such required or deemed provision shall control.
SECTION 13.06. Governing Law. THIS SUBORDINATED INDENTURE AND EACH
-------------
SUBORDINATED SECURITY AND COUPON SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING
EFFECT TO ANY CONTRARY CONFLICT OF LAWS OR CHOICE OF LAW PROVISIONS OF THE LAW
OF THE STATE OF NEW YORK OR ANY OTHER JURISDICTION.
SECTION 13.07. Effect of Headings. The Article and Section headings
------------------
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
SECTION 13.08. Subordinated Securities in a Foreign Currency or in ECU.
-------------------------------------------------------
Unless otherwise specified in an Officers' Certificate delivered pursuant to
Section 2.03 of this Subordinated Indenture with respect to a particular series
of Subordinated Securities, whenever for purposes of this Subordinated Indenture
any action may be taken by the Holders of a specified percentage in aggregate
principal amount at maturity of Subordinated Securities of all series or all
series affected by a particular action at the time Outstanding and, at such
time, there are Outstanding Subordinated Securities of any series which are
denominated in a currency (including ECU's) other than United States Dollars,
then the principal amount of Subordinated Securities of such series which shall
be deemed to be Outstanding for the purpose of taking such action shall be that
amount of United States Dollars that could be obtained for such amount at the
Market Exchange Rate. For purposes of this Section 13.08, "Market Exchange
Rate" shall mean the United States Dollar buying rate in The City of New York at
12:00 p.m. (New York City time) for cable transfers of that currency as
published by the Federal Reserve Bank of New York; provided, in the case of
ECUs, "Market Exchange Rate" shall mean the rate of exchange determined by the
Commission of the European Communities (or any successor thereto) as published
in the Official Journal of the European Communities (such publication or any
successor publication, the "Journal"). If such Market Exchange Rate is not
available for any reason with respect to such currency, the Trustee shall use,
in its sole discretion and without liability on its part, such quotation of the
Federal Reserve Bank of New York or, in the case of ECUs, the rate of exchange
as published in the Journal, as of the most recent available date, or quotations
or, in the case of ECUs, rates of exchange from one or more major banks in The
City of New York or in the country of issue of the currency in question, which
for purposes of the ECU shall be Brussels, Belgium, or such other quotations or,
in the case of ECU, rates of exchange as the Trustee shall deem appropriate.
The provisions of this paragraph shall apply in determining the equivalent
principal amount at maturity in respect of Subordinated Securities of a series
denominated in a currency other than United States Dollars in connection with
any action taken by Holders of Subordinated Securities pursuant to the terms of
this Subordinated Indenture.
69
All decisions and determinations of the Trustee regarding the Market
Exchange Rate or any alternative determination provided for in the preceding
paragraph shall be in its sole discretion and shall, in the absense of willful
misconduct, gross negligence or bad faith, be conclusive to the extent permitted
by law for all purposes and irrevocably binding upon the Company and all
Holders.
SECTION 13.09. Judgment Currency. The Company agrees, to the fullest
-----------------
extent that it may effectively do so under applicable law, that (a) if for the
purpose of obtaining judgment in any court it is necessary to convert the sum
due in respect of the principal of or interest on the Subordinated Securities of
any series (the "Required Currency"), into a currency in which a judgment will
be rendered (the "Judgment Currency"), the rate of exchange used shall be the
rate at which in accordance with normal banking procedures the Trustee could
purchase in The City of New York the Required Currency with the Judgment
Currency on the day on which final unappealable judgment is entered, unless such
day is not a Business Day in The City of New York, then, to the extent permitted
by applicable law, the rate of exchange used shall be the rate at which in
accordance with normal banking procedures the Trustee could purchase in The City
of New York the Required Currency with the Judgment Currency on the Business Day
in The City of New York preceding the day on which final unappealable judgment
is entered and (b) its obligations under this Subordinated Indenture to make
payments in the Required Currency (i) shall not be discharged or satisfied by
any tender, or any recovery pursuant to any judgment (whether or not entered in
accordance with subsection (a)), in any currency other than the Required
Currency, except to the extent that such tender or recovery shall result in the
actual receipt, by the payee, of the full amount of the Required Currency
expressed to be payable in respect of such payments, (ii) shall be enforceable
as an alternative or additional cause of action for the purpose of recovering in
the Required Currency the amount, if any, by which such actual receipt shall
fall short of the full amount of the Required Currency so expressed to be
payable and (iii) shall not be affected by judgment being obtained for any other
sum due under this Subordinated Indenture.
SECTION 13.10. Provisions of the Subordinated Indenture and Subordinated
---------------------------------------------------------
Securities for the Sole Benefit of the Parties and the Subordinated
-------------------------------------------------------------------
Securityholders. Nothing in this Subordinated Indenture or in the Subordinated
---------------
Securities or Coupons, expressed or implied, shall give or be construed to give
any Person, other than the parties hereto, their successors hereunder and the
Holders of the Subordinated Securities and Coupons, any benefit or any legal or
equitable right, remedy or claim under or in respect of this Subordinated
Indenture, all its covenants, conditions and provisions being for the sole
benefit of the parties hereto, their successors hereunder and the Holders of the
Subordinated Securities.
SECTION 13.11. Acts of Holders; Record Dates. Any request, demand,
-----------------------------
authorization, direction, notice, consent, waiver or other action provided or
permitted by this Subordinated Indenture to be given, made or taken by Holders
may be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Holders in person or by an agent duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Subordinated
70
Indenture and (subject to Section 7.01) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved in any reasonable manner which the Trustee deems
sufficient.
The ownership of Subordinated Securities shall be proved by the Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Holder of any Subordinated Security of a series shall bind
every future Holder of the same Subordinated Security of a series and the Holder
of every Subordinated Security of a series issued upon the registration of
transfer thereof or in exchange therefore or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Subordinated Security.
The Company may set any day as a record date for the purpose of determining
the Holders of Outstanding Subordinated Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Subordinated
Indenture to be given, made or taken by Holders of Subordinated Securities of
such series, provided that the Company may not set a record date for, and the
provisions of this paragraph shall not apply with respect to, the giving or
making of any notice, declaration, request or direction referred to in the next
paragraph. If any record date is set pursuant to this paragraph, the Holders of
Outstanding Subordinated Securities of the relevant series on such record date,
and no other Holders, shall be entitled to take the relevant action, whether or
not such Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount at maturity of
Outstanding Subordinated Securities of such series on such record date. Nothing
in this paragraph shall be construed to prevent the Company from setting a new
record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no effect),
and nothing in this paragraph shall be construed to render ineffective any
action taken by Holders of the requisite principal amount at maturity of
Outstanding Subordinated Securities of the relevant series on the date such
action is taken. Promptly after any record date is set pursuant to this
paragraph, this Company, at its own expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to be
given to the Trustee in writing and to each Holder of Subordinated Securities of
the relevant series in the manner set forth in Section 13.12.
The Trustee may set any day as a record date for the purpose of determining
the Holders of Outstanding Subordinated Securities of any series entitled to
join in the giving or making of (i) any Notice of Default, (ii) any declaration
of acceleration referred to in Section 6.01, (iii) any request to institute
proceedings referred to in Section 6.06(2) or (iv) any direction referred to in
Section 6.09, in each case with respect to Subordinated Securities of such
series. If any record date is set pursuant to this paragraph, the Holders of
Outstanding Subordinated Securities of such series on such record date, and no
other Holders, shall be entitled to join in such notice, declaration, request or
direction, whether or not such Holders remain Holders after such record date;
provided that no such action shall be effective hereunder unless taken on or
prior to the
71
applicable Expiration Date by Holders of the requisite principal amount at
maturity of Outstanding Subordinated Securities of such series on such record
date. Nothing in this paragraph shall be construed to prevent the Trustee from
setting a new record date for any action for which a record date has previously
been set pursuant to this paragraph (whereupon the record date previously set
shall automatically and with no action by any Person be cancelled and of no
effect), and nothing in this paragraph shall be construed to render ineffective
any action taken by Holders of the requisite principal amount at maturity of
Outstanding Subordinated Securities of the relevant series on the date such
action is taken. Promptly after any record date is set pursuant to this
paragraph, the Trustee, at the Company's expense, shall cause notice of such
record date, the proposed action by Holders and the applicable Expiration Date
to be given to the Company in writing and to each Holder of Securities of the
relevant series in the manner set forth in Section 13.12.
With respect to any record date set pursuant to this Section, the party
hereto which sets such record dates may designate any day as the "Expiration
Date" and from time to time may change the Expiration Date to any earlier or
later day; provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Subordinated Securities of the relevant series in the manner
set forth in Section 13.12, on or prior to the existing Expiration Date. If an
Expiration Date is not designated with respect to any record date set pursuant
to this Section, the party hereto which set such record date shall be deemed to
have initially designated the 180th day after such record date as the Expiration
Date with respect thereto, subject to its right to change the Expiration Date as
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Subordinated Security may do so
with regard to all or any part of the principal amount of such Subordinated
Security or by one or more duly appointed agents each of which may do so
pursuant to such appointment with regard to all or any part of such principal
amount.
SECTION 13.12. Notices and Demands on Holders of Subordinated Securities
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and Coupons.
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Where this Subordinated Indenture provides for notice to Holders of
Registered Subordinated Securities, such notice shall be sufficiently given
(unless otherwise herein expressly provided) if in writing and mailed, first-
class mail, postage prepaid, to each Holder entitled thereto, at its last
address as it appears in the Register.
Where this Subordinated Indenture provides for notice to Holders of
Unregistered Subordinated Securities, such notice shall be sufficiently given
(unless otherwise expressly provided herein) (i) by publication of such notice
at least once in an Authorized Newspaper in the Borough of Manhattan, The City
of New York, and at least once in an Authorized Newspaper in London (and if
required by Section 4.09, once in an Authorized Newspaper in Luxembourg), and
(ii) by mailing such notice to the Holders of Unregistered Subordinated
Securities who have filed their names and addresses with the Trustee pursuant to
Section 313(c)(2) of the Trust Indenture Act at such addresses as were so
furnished to the Trustee.
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In any case where notice to such Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Subordinated Indenture provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
In case, by reason of the suspension of or irregularities in regular mail
service, it shall be impracticable to mail notice to the Holders when such
notice is required to the given pursuant to any provision of this Subordinated
Indenture, then any manner of giving such notice as shall be reasonably
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.
SECTION 13.13. Separability. In any case any provision in this
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Subordinated Indenture or in the Subordinated Securities shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions hereof or thereof, as the case may be, shall not in any way
be affected or impaired thereby.
SECTION 13.14. Subordinated Indenture May be Executed in Counterparts.
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This Subordinated 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.
ARTICLE FOURTEEN
SUBORDINATION OF SECURITIES
SECTION 14.01. Subordinated Securities Subordinated to Senior
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Indebtedness. The Company covenants and agrees, and each Holder of Subordinated
------------
Securities, by its acceptance thereof, likewise covenants and agrees, that the
indebtedness represented by the Subordinated Securities and the payment of the
principal of (and premium, if any) in respect of each and all of the
Subordinated Securities is hereby expressly subordinated, to the extent and in
the manner hereinafter set forth, in right of payment to the prior payment in
full of Senior Indebtedness.
In the event (a) of any distribution of assets of the Company upon any
dissolution, winding up, liquidation or reorganization of the Company whether in
bankruptcy, insolvency, reorganization or receivership proceeding or upon an
assignment for the benefit of creditors or any other marshalling of the assets
and liabilities of the Company or otherwise, except a distribution in connection
with a member or consolidation or a conveyance or transfer of all or
substantially all of the properties of the Company which complies with the
requirements of Section 4.02, or (b) that a default shall have occurred and be
continuing with respect to the payment of principal of (or premium, if any) in
respect of any Senior Indebtedness, or (c) that the principal of the
Subordinated Securities of any series (or in the case of Original Issue Discount
Subordinated Securities, the portion of the principal amount thereof referred to
in Section 6.01) shall have been declared due and payable pursuant to Section
6.01 and such declaration shall not have been rescinded and annulled as provided
in Section 6.01, then:
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(1) in a circumstance described in the foregoing clause (a) or (b), the
holders of all Senior Indebtedness, and in the circumstance described in the
foregoing clause (c), the holders of all Senior Indebtedness outstanding at the
time the principal of such Subordinated Securities (or in the case of Original
Issue Discount Subordinated Securities, such portion of the principal amount)
shall have been so declared due and payable, shall first be entitled to receive
payment of the full amount due thereon in respect of principal, premium (if
any), interest, or provision shall be made for such payment in money or money's
worth, before the Holders of any of the Subordinated Securities are entitled to
receive any payment on account of the principal of (or premium, if any) or
interest payable in respect of the indebtedness evidenced by the Subordinated
Securities;
(2) any payment by, or distribution of assets of, the Company of any kind
or character, whether in cash, property or securities (other than securities of
the Company as reorganized or readjusted or securities of the Company or any
other Person provided for by a plan of reorganization or readjustment the
payment of which is subordinate, at least to the extent provided in this Article
with respect to the securities, to the payment of all Senior Indebtedness,
provided that the rights of the holders of the Senior Indebtedness are not
altered by such reorganization or readjustment), to which the Holders of any of
the Subordinated Securities would be entitled except for the provisions of this
Article shall be paid or delivered by the Person making such payment or
distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee
or otherwise, directly to the holders of such Senior Indebtedness or their
representative or representatives or to the trustee or trustees under any
indenture under which any instrument evidencing any of such Senior Indebtedness
may have been issued, ratably according to the aggregate amounts remaining
unpaid on account of such Senior Indebtedness held or represented by each, to
the extent necessary to make payment in full of all Senior Indebtedness
remaining unpaid after giving effect to any concurrent payment or distribution
(or provision therefore) to the holders of such Senior Indebtedness, before any
payment or distribution is made to the Holders of the indebtedness evidenced by
the Subordinated Securities under this Subordinated Indenture; and
(3) in the event that, notwithstanding the foregoing, any payment by, or
distribution of assets of, the Company of any kind of character, whether in
cash, property or securities (other than securities of the Company as
reorganized or readjusted or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustments the payment of which
is subordinate, at least to the extent provided in this Article with respect to
the Subordinated Securities, to the payment of all Senior Indebtedness, provided
that the rights of the holders of Senior Indebtedness are not altered by such
reorganization or readjustment), shall be received by the Holders of any of the
Subordinated Securities before all Senior Indebtedness is paid in full, such
payment or distribution shall be paid over to the holders of such Senior
Indebtedness or their representative or representatives or to the trustee or
trustees under any indenture under which any instruments evidencing any of such
Senior Indebtedness may have been issued, ratably as aforesaid, for application
to the payment of all Senior Indebtedness remaining unpaid until all such Senior
Indebtedness shall have been paid in full, after giving effect to any concurrent
payment or distribution (or provision therefor) to the holders of such Senior
Indebtedness.
SECTION 14.02. Subrogation. Subject to the payment in full of all Senior
-----------
Indebtedness to which the indebtedness evidenced by the Subordinated Securities
is in the circumstances
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subordinated as provided in Section 14.01, the Holders of the Subordinated
Securities shall be subrogated to the rights of the holders of such Senior
Indebtedness to receive payments or distributions of cash, property or
Subordinated Securities of the Company applicable to such Senior Indebtedness
until all amounts owing on the Subordinated Securities shall be paid in full,
and, as between the Company, its creditors other than holders of such Senior
Indebtedness, and the Holders of the Subordinated Securities, no such payment or
distribution made to the holders of such Senior Indebtedness by virtue of this
Article which otherwise would have been made to the Holders of the Subordinated
Securities shall be deemed to be a payment by the Company on account of such
Senior Indebtedness, it being understood that the provisions of this Article are
and are intended solely for the purpose of defining the relative rights of the
Holders of the Subordinated Securities, on the one hand, and the holders of
Senior Indebtedness.
SECTION 14.03. Obligation of the Company Unconditional. Nothing contained
---------------------------------------
in this Article or elsewhere in this Subordinated Indenture or in the
Subordinated Securities is intended to or shall impair, as between the Company,
its creditors other than the holders of Senior Indebtedness, and the Holders of
the Subordinated Securities, the obligation of the Company, which is absolute
and unconditional, to pay to the Holders of the Subordinated Securities the
principal of (and premium, if any) and interest payable in the respect of the
Subordinated 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 Subordinated Securities and creditors of the
Company other than the holders of Senior Indebtedness nor shall anything herein
or therein prevent the Trustee or the Holder of any Security from exercising all
remedies otherwise permitted by applicable law upon default under this
Subordinated Indenture, subject to the rights, if any, under this Article of the
holders of Senior Indebtedness in respect of cash, property or Subordinated
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, the Trustee and the Holders of the Subordinated Securities shall
be entitled to rely upon any order or decree made by any court of competent
jurisdiction in which any such dissolution, winding up, liquidation or
reorganization proceeding affecting the affairs of the Company is pending or
upon a certificate of the trustee in bankruptcy, receiver, assignee for the
benefit of creditors, liquidating trustee or agent or other person making any
payment or distribution, delivered to the Trustee or to the Holders of the
Subordinated Securities, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount paid or distributed thereon and all other facts
pertinent thereto or to this Article.
SECTION 14.04. Payments on Subordinated Securities Permitted. Nothing
---------------------------------------------
contained in this Article or elsewhere in this Subordinated Indenture, or in any
of the Subordinated Securities, shall affect the obligation of the Company to
make, or prevent the Company from making, payment of the principal of (or
premium, if any) or interest payable in respect of the Subordinated Securities
in accordance with the provisions hereof and thereof, except as otherwise
provided in this Article.
SECTION 14.05. Effectuation of Subordination by Trustee. Each Holder of
----------------------------------------
the Subordinated Securities, by its acceptance thereof, authorizes and directs
the Trustee in its behalf
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to take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article and appoints the Trustee its attorney-in-
fact for any and all such purposes.
SECTION 14.06. Knowledge of Trustee. Notwithstanding the provisions of
--------------------
this Article or any other provisions of this Subordinated Indenture, the Trustee
shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness and shall not be charged with knowledge of the existence of any
facts which would prohibit the making of any payment or moneys to or by the
Trustee, or the taking of any other action by the Trustee, unless and until the
Trustee shall have received written notice thereof from the Company, any Holder
of Subordinated Securities, any paying or conversion agent of the Company or the
holder or representative of any class of Senior Indebtedness; provided, however,
that if the Trustee shall not have received the notice provided for in this
Section at least three 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 Subordinated Security) then, anything herein contained to the contrary
notwithstanding, the Trustee shall have all power and authority to receive such
money and to apply the same to the purpose for which such money was received and
shall not be affected by any notice to the contrary which may be received by it
during or after such three Business Day period.
SECTION 14.07. Trustee May Hold Senior Indebtedness. The Trustee in its
------------------------------------
individual capacity shall be entitled to all the rights set forth in this
Article with respect to any Senior Indebtedness at the time held by it, to the
same extent as any other holder of Senior Indebtedness, and nothing in Section
313 of the Trust Indenture Act or elsewhere in this Subordinated Indenture shall
deprive the Trustee of any of its rights as such holder.
Nothing in this Article shall subordinate any claims of, or payments to,
the Trustee (under or pursuant to Section 7.06) to Senior Indebtedness.
SECTION 14.08. Rights of Holders of Senior Indebtedness Not Impaired. No
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right of any present or future holder of any Senior Indebtedness to enforce the
subordination herein shall at any time or in any way be prejudiced or impaired
by any act or failure to act on the part of the Company or by any non-compliance
by the Company with the terms, provisions and covenants of this Subordinated
Indenture, regardless of any knowledge thereof any such holder may have or be
otherwise charged with.
[Signature page follows]
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IN WITNESS WHEREOF, EXODUS COMMUNICATIONS, INC. has caused this
Subordinated Indenture to be signed by its Chairman of the Board or any Vice-
Chairmen of the Board or its President or Chief Financial Officer or one of its
Vice-Presidents and HSBC BANK USA has caused this Subordinated Indenture to be
signed by one of its Vice-Presidents, all as of the day and year first written
above.
EXODUS COMMUNICATIONS, INC.
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Senior Vice President,
Legal and Corporate Affairs,
General Counsel and Secretary
HSBC BANK USA, as Trustee
By /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------
Vice-President
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