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EXHIBIT 99.5
CONFORMED COPY
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TRUST INDENTURE
Dated as of January 1, 1992
Between
KMART CORPORATION
And
XXX
And
XXXXXXXXXX,
AS TRUSTEES
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TABLE OF CONTENTS
SECTION HEADING PAGE
Parties................................................................... 1
Recitals.................................................................. 1
SECTION 1. INTERPRETATION OF AGREEMENT; DEFINITIONS.................... 2
Section 1.1. Definitions......................................... 2
Section 1.2. Accounting Principles............................... 10
Section 1.3. Directly or Indirectly.............................. 10
SECTION 2. THE NOTES................................................... 11
Section 2.1. Description of Notes................................ 11
Section 2.2. Improvement Notes................................... 11
Section 2.3. Denominations; Execution of Notes; Certificate of
Authentication...................................... 16
Section 2.4. Payment of the Notes................................ 16
Section 2.5. The Register........................................ 17
Section 2.6. Transfers and Exchanges............................. 17
Section 2.7. The New Notes....................................... 18
Section 2.8. Cancellation of Notes............................... 18
Section 2.9. Corporate Trustee as Agent.......................... 19
Section 2.10. Ownership........................................... 19
SECTION 3. PARTICULAR COVENANTS OF THE COMPANY......................... 19
Section 3.1. Warranty of Title................................... 19
Section 3.2. Payment of Principal, Premium and Interest.......... 19
Section 3.3. Office for Notices.................................. 19
Section 3.4. Note Agreement and Mortgage Covenants............... 20
Section 3.5. Maintenance of Corporate Existence, Rights.......... 20
Section 3.6. Maintenance of Lien; Recording...................... 20
Section 3.7. Further Assurances; Right of Trustees to Perform....
its Covenants....................................... 21
Section 3.8. Maintenance of Property............................. 21
Section 3.9. Insurance........................................... 22
Section 3.10. Payment of Taxes and Other Charges.................. 22
Section 3.11. Compliance with Laws................................ 22
Section 3.12 Mergers and Consolidations.......................... 23
Section 3.13. Consolidated Tangible Net Worth..................... 23
Section 3.14. Maintenance of Rating............................... 23
Section 3.15. Termination of Pension Plans........................ 23
Section 3.16 Transactions with Affiliates........................ 23
Section 3.17. Repurchase of Notes................................. 24
Section 3.18. Financial Information and Reports................... 24
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Section 3.19. Notice of Default..................................... 26
SECTION 4. POSSESSION, USE, SUBSTITUTION AND RELEASE OF
PROPERTY....................................................... 27
Section 4.1. Company's Right of Possession.......................... 27
Section 4.2. Release of Mortgaged Property - Consent of
Noteholders............................................ 27
SECTION 5. PREPAYMENT OF NOTES............................................ 27
Section 5.1. Prepayments and Manner Thereof......................... 27
Section 5.2. Optional Prepayment in the Event of Casualty or
Condemnation........................................... 27
Section 5.3. Optional Prepayment upon Election to Withdraw.......... 27
Section 5.4. Optional Prepayment with Premium....................... 28
Section 5.5. Prepayment of Notes upon a Designated Event............ 28
Section 5.6. Optional Prepayment of Notes upon Determination to
Remain Dark............................................ 30
Section 5.7. Notice of Prepayments.................................. 30
Section 5.8. Allocation of Prepayments.............................. 31
SECTION 6. REMEDIES OF THE TRUSTEES AND THE NOTEHOLDERS................... 31
Section 6.1. Definition of Event of Default......................... 31
Section 6.2. Suits for Endorsement; Power of Sale................... 33
Section 6.3. Foreclosure and Sale of Mortgaged Property............. 34
Section 6.4. Adjournment of Sale.................................... 34
Section 6.5. Trustees May Execute Conveyances and Deliver
Possession; Sale a Bar................................. 34
Section 6.6. Receipt Sufficient Discharge for Purchaser............. 35
Section 6.7. Sale to Accelerate Notes............................... 35
Section 6.8. Application of Proceeds of Sale........................ 35
Section 6.9. Purchase of Mortgaged Properties....................... 36
Section 6.10. Trustees Entitled to Appointment of Receiver........... 36
Section 6.11. Trustees May Enforce Rights without Notes.............. 36
Section 6.12. Notice of Event of Default; Waiver..................... 37
Section 6.13. Limitation on Noteholders' Right to ▇▇▇................ 37
Section 6.14. Remedies Cumulative.................................... 38
Section 6.15. Delay or Omission Not a Waiver......................... 38
Section 6.16. Waiver of Extension, Appraisement, Stay, Laws.......... 38
Section 6.17. Restoration of Positions............................... 39
Section 6.18. Control of Remedies by Noteholders..................... 39
Section 6.19 Trustees May File Proofs of Claims..................... 39
Section 6.20. Remedies Subject to Provisions of Law.................. 40
SECTION 7. CONCERNING THE TRUSTEES........................................ 40
Section 7.1. Duties of Trustees..................................... 40
Section 7.2. Trustees' Liability.................................... 40
Section 7.3. No Responsibility of Trustees for Recitals............. 42
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Section 7.4. Compensation and Expenses of Trustees;
Indemnification; Lien Therefore........................ 42
Section 7.5. Moneys Received by Trustees; Trust Funds ..............
- Segregation.......................................... 43
Section 7.6. Action by Individual Trustee........................... 43
Section 7.7. Resignation of Corporate Trustee....................... 43
Section 7.8. Removal of Corporate Trustee........................... 43
Section 7.9. Appointment of Successor Corporate Trustee............. 43
Section 7.10. Succession of Successor Trustee........................ 44
Section 7.11. Eligibility of Corporate Trustee....................... 44
Section 7.12. Successor Trustee by Merger............................ 44
Section 7.13. Resignation of Individual Trustee...................... 45
Section 7.14. Removal of Individual Trustee.......................... 45
Section 7.15. Appointment of Successor to Individual Trustee......... 45
Section 7.16. Succession of Successor to Individual Trustee.......... 45
Section 7.17. Co-Corporate Trustees.................................. 46
SECTION 8. SUPPLEMENTAL INDENTURES, AMENDMENTS, WAIVERS AND
CONSENTS........................................................ 47
Section 8.1. Supplemental Indentures, Amendments, Waivers and
Consents by Noteholders................................. 47
Section 8.2. Solicitation of Noteholders............................. 48
Section 8.3. Notice of Supplemental Indentures Amendments,
Waivers and Consents.................................... 48
Section 8.4. Opinion of Counsel Conclusive as to Supplemental
Indenture, Amendment, Waiver and Consent................ 48
Section 8.5. Expenses of Supplemental Indentures; Amendments,
Waivers and Consents.................................... 49
SECTION 9. ACTION BY NOTEHOLDERS .......................................... 49
Section 9.1. Evidence of Action by Noteholders....................... 49
Section 9.2. Noteholders' Execution of Instruments; Proof
of Holdings............................................. 49
SECTION 10. DISCHARGE....................................................... 49
Section 10.1 Discharge............................................... 49
Section 10.2. Corporate Trustee's Retention of Moneys
Deposited for Payment of Notes......................... 50
SECTION 11. MISCELLANEOUS PROVISIONS....................................... 50
Section 11.1. Recapture.............................................. 50
Section 11.2. Indenture for Benefit of Parties Hereto................ 51
Section 11.3. Severability........................................... 51
Section 11.4. Basis of Opinions of Counsel and Certificates.......... 51
Section 11.5. Addresses for Notices and Demands...................... 51
Section 11.6. Environmental Indemnity and Covenant Not to ▇▇▇........ 52
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Section 11.7.Successors and Assigns........................... 53
Section 11.8.Counterparts; Descriptive Headings............... 53
Section 11.9.Governing Law.................................... 53
Signatures............................................................ 54
ATTACHMENT TO TRUST INDENTURE:
Exhibit A - Form of 9.06% Senior Secured Note due February 1, 2012
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TRUST INDENTURE
TRUST INDENTURE dated as of January 1, 1992 (herein, as the same may be
amended or supplemented from time to time, called the "Indenture") between
KMART CORPORATION, a Michigan corporation (the "Company"), whose post office
address is International Headquarters, ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, and XXX, a national banking association (the
"Corporate Trustee"), whose post office address is, XXX Attention: Corporate
Trust Department, and XXXXXXXXXX (the "Individual Trustee"), whose post
office address is XXX, Attention: Corporate Trust Department, as trustees (the
Individual Trustee and the Corporate Trustee being herein collectively
referred to as the "Trustees").
WHEREAS, the defined terms used in this Indenture shall have the respective
meanings indicated in Section 1.1 unless elsewhere defined or the context shall
otherwise require; and
WHEREAS, the Company has the power and proposes to issue its 9.06% Senior
Secured Notes due February 1, 2012 (the "Initial Notes", such Initial Notes,
together with the Improvement Notes which may be issued from time to time
pursuant to this Indenture, being hereinafter collectively referred to as the
"Notes") which Notes are to be issued under and secured by this Indenture; and
WHEREAS, all things necessary to make the Notes, when executed by the
Company, the valid obligations of the Company, and to constitute this
Indenture, together with the Mortgages, a valid Pledge for the security of the
Notes in accordance with the terms of this Indenture have been done or
authorized;
NOW, THEREFORE, in consideration of the premises, the acceptance by the
Trustees of the trust created hereby, the purchase and acceptance of the Notes
by the purchasers thereof and the sum of Seventy-One Million Four Hundred
Seventeen Thousand Five Hundred Ninety and 00/100 (U.S. $71,417,590.00)
Dollars and other good and valuable consideration, receipt whereof upon the
delivery of this Indenture the Company hereby acknowledges, and in order to
secure the equal and pro rata payment of both the principal of and interest and
premium, if any, on the Notes at any time outstanding hereunder according to
their tenor and the provisions hereof and to secure all other indebtedness
secured by this Indenture or any of the Mortgages, and to secure the faithful
performance and observance of all the covenants and provisions in the Notes,
the Note Agreements, the Mortgages and in this Indenture contained, and to
declare the terms and conditions upon which the Notes will be secured,
authenticated, issued, transferred and exchanged, the Company has executed and
delivered this Indenture and certain other agreements referred to herein to
which it is a party, and has Pledged and by these presents does Pledge unto the
Trustees and to their successors in the trust hereby created all of the
Company's estate, right, title and interest in, to and under any and all of
the Mortgaged Properties (as hereinafter defined, and including all such
additional Mortgaged Properties as may hereafter be Pledged to the Trustees
hereunder and any substitute or substitutes therefor or replacement or
replacements thereof
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as and to the extent required under this Indenture or any of the Mortgages and
any and all moneys and other property delivered to the Trustees and all income
and proceeds from any of the foregoing), which together with all the benefits
and rights of the Trustees and the holders of the Notes arising by, through,
under or on account of this Indenture, the Notes or any of the Mortgages are
hereinafter collectively called the "Trust Estate".
TO HAVE AND TO HOLD all and singular the Trust Estate whether now owned or
held, or hereafter acquired, unto the Trustees, their successors in trust and
assigns forever;
IN TRUST, NEVERTHELESS, for the equal and ratable benefit and security of the
Notes from time to time outstanding hereunder, without preference, priority or
distinction of any thereof over any other by reason of difference in time of
issuance, sale, authentication, delivery or otherwise, and for the enforcement
of the payment of the principal of, premium, if any, and interest on the Notes
in accordance with their terms, and all other sums payable under this
Indenture, the Note Agreements or the Mortgages or on the Notes, and the
observance and performance of the provisions of, the Note Agreements, the
Mortgages and this Indenture, all as herein provided.
IT IS HEREBY COVENANTED, DECLARED AND AGREED, that the Notes are to be
issued, authenticated, delivered and secured, and that the Trust Estate is to
be held, dealt with and disposed of by the Trustees, upon and subject to the
provisions of this Indenture.
IT IS HEREBY FURTHER COVENANTED, DECLARED AND AGREED, that all of the Notes
are to be authenticated and delivered and the Trust Estate is to be held and
applied by the Trustees subject to the further covenants, conditions and trusts
hereinafter set forth, and the Company does hereby covenant and agree to and
with the Trustees, for the equal and proportionate benefit of all holders of
the Notes as follows:
SECTION 1. INTERPRETATION OF AGREEMENT; DEFINITIONS.
Section 1.1. Definitions. Unless the context otherwise requires, the terms
hereinafter set forth when used herein shall have the following meanings and
the following definitions shall be equally applicable to both the singular and
plural forms of any of the terms herein defined:
"Affiliate" shall mean any Person, other than a Subsidiary (a) which,
directly or indirectly, through one or more intermediaries controls, or is
controlled by, or is under common control with, the Company, (b) which
beneficially owns or holds 5% or more of any class of the Voting Stock of the
Company, or (c) 5% or more of the Voting Stock (or in the case of a Person
which is not a corporation, 5% or more of the Securities of such Person shall
confer any rights or interests similar to the Voting Stock of a corporation)
of which is beneficially owned or held by the Company or Subsidiary. The
term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of Voting Stock, by contract or otherwise.
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"ALTA" shall have the meaning assigned thereto in Section 6(c) of the Note
Agreements.
"Aggregate Total Cost" shall mean an amount equal to the sum of the Total
Cost of all Mortgaged Properties of the Company which were or are subject to
the lien of a Mortgage originally delivered on the Closing Date to the
Trustees for the benefit of the holders of the Notes under and pursuant to
the Note Agreements.
"Business Day" shall mean any day other than a Saturday, Sunday, statutory
holiday or other day on which banks in Detroit, Michigan, New York, New York,
XXX or XXX are required by law to close.
"California Deed of Trust" shall mean any Mortgage the subject of which
is a Mortgaged Property located in the State of California.
"Closing Date" shall have the meaning assigned thereto in the Note
Agreements.
"Company" shall mean Kmart Corporation, a Michigan corporation, and any
corporation succeeding to all or substantially all of the Properties and
business of Kmart Corporation and each substitution and replacement thereof.
"Company Notice" shall have the meaning set forth in Section 5.5(a).
"Consolidated Net Worth" shall mean, as of the date of any determination
thereof, the amount of the capital stock accounts (net of treasury stock, at
cost) plus (or minus in the case of a deficit) the surplus and retained
earnings of the Company and its Subsidiaries.
"Consolidated Tangible Net Worth" shall mean, as of the date of any
determination thereof, the algebraic sum of:
(a) Consolidated Net Worth,
MINUS
(b) the net book value, after deducting any reserves applicable thereto,
of all items of the following character which are included in the assets of
the Company and its Subsidiaries, to wit:
(1) the incremental increases in an asset resulting from any
reappraisal, revaluation or write-up of assets;
(2) goodwill, organization or experimental expenses, patents, patent
applications, permits, trademarks, trade names, copyrights, licenses,
research and development expenses, franchises and other like intangibles and
unamortized debt discount and expense;
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MINUS
(c) the net book value of all shares of preferred stock of the Company
which are subject to sinking fund or other like mandatory prepayment
provisions;
MINUS
(d) deferred income taxes and deferred investment tax credits of the
Company and its Subsidiaries;
all determined in accordance with GAAP.
"Default" shall mean any event which would constitute an Event of Default
if all requirements in connection therewith for the giving of notice, the
lapse of time, and the happening of any further condition, event or act, had
been satisfied.
"Designated Event" shall have the meaning set forth in Section 5.5(c).
"Designated Event Delayed Prepayment Date" shall have the meaning set
forth in Section 5.5(b).
"Designated Event Prepayment Date" shall have the meaning set forth in
Section 5.5(a).
"Environmental Legal Requirement" shall mean any international, Federal,
state or local statute, law, regulation, order, consent decree, judgment,
permit, license, code, covenant, deed restriction, common law, treaty,
convention, ordinance or other requirement relating to public health, safety
or the environment, including, without limitation, those relating to
releases, discharges or emissions to air, water, land or groundwater, to the
withdrawal or use of groundwater, to the use and handling of polychlorinated
biphenyls or asbestos, to the disposal, treatment, storage or management of
hazardous or solid waste, or Hazardous Substances or crude oil, or any
fraction thereof, or to exposure to toxic or hazardous materials, to the
handling, transportation, discharge or release of gaseous or liquid Hazardous
Substances and any regulation, order, notice or demand issued pursuant to
such law, statute or ordinance, in each case applicable to the property of
the Company and its Subsidiaries or the operation, construction or
modification of any thereof, including without limitation the following: the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended by the Superfund Amendments and Reauthorization Act of 1986, the
Solid Waste Disposal Act, as amended by the Resource Conservation and
Recovery Act of 1976 and the Hazardous and Solid Waste Amendments of 1984,
the Hazardous Materials Transportation Act, as amended, the Federal Water
Pollution Control Act, as amended by the Clean Water Act of 1976, the Safe
Drinking Water Control Act, the Clean Air Act of 1966, as amended, the Toxic
Substances Control Act of 1976, the Occupational Safety and Health Act of
1977, as amended, the
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Emergency Planning and Community Right-to-Know Act of 1986, the National
Environmental Policy Act of 1975, the Oil Pollution Act of 1990 and any
similar or implementing state law, and any state statute and any further
amendments to these laws providing for financial responsibility for cleanup
or other actions with respect to the release or threatened release of
Hazardous Substances or crude oil, or any fraction thereof and all rules,
regulations, guidance documents and publication promulgated thereunder.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Event of Default" shall mean any of the Events of Default referred to in
Section 6.1 hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as the same
shall be amended from time to time.
"Fee-Owned Mortgaged Property" shall mean individually each of the 10
retail discount stores more fully described on Schedule II, Part A, attached
to the Note Agreement, title to each of which stores is owned in fee simple
by the Company, and each and every substitution and replacement thereof in
accordance with the terms and provisions of this Indenture and the related
Mortgage, provided that any such substitution or replacement of any thereof
shall be a Fee-Owned Mortgaged Property. "Fee-Owned Mortgaged Properties"
shall mean collectively all of the Fee-Owned Mortgaged Properties.
"GAAP" shall mean generally accepted accounting principles.
"Hazardous Substance" shall mean any hazardous or toxic material,
substance or waste pollutant or contaminant which is regulated as such under
any statute, law, ordinance, rule or regulation of any Federal, regional,
state or local authority having jurisdiction over any of the Mortgaged
Properties or its use, including but not limited to any material, substance
or waste which is: (a) defined as a hazardous substance under Section 311 of
the Federal Water Pollution Control Act (33 U.S.C. Section 1317), as
amended; (b) regulated as a hazardous waste under Section 1004 of the
Federal Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et
seq.), as amended; (c) defined as a hazardous substance under Section 101 of
the Comprehensive Environmental Response, Compensation and Liability Act
as amended, or (d) defined or regulated as a hazardous substance or
hazardous waste under any rules or regulations promulgated under any of the
foregoing statutes.
"Improvements" shall mean any capital replacements, additions or
improvements to any of the Mortgaged Properties which the Company is not
otherwise required to make by the terms of the Mortgage relating to such
Mortgaged Property.
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"Improvement Notes" shall mean any of the Improvement Notes issued pursuant
to Section 2.2 hereof.
"Initial Purchasers" shall mean XXX, XXXXXXXXXX, XXX, XXXXXXXXXX, XXX
XXXXXXXXXX and XXX, as purchasers under the Note Agreements, and any
Person affiliated therewith, so long as the Initial Purchasers or any such
Person or the respective nominees of any thereof are holders of any of the
Notes.
"Institutional Investor" shall mean any of the following Persons: (a) any
bank, savings and loan association, savings institution, trust company or
national banking association, acting for its own account or in a fiduciary
capacity, (b) any charitable foundation, (c) any insurance company, (d) any
fraternal benefit society, (e) any pension, retirement or profit sharing
trust or fund within the meaning of Title I of ERISA or for which any bank,
trust company, national banking association or investment adviser registered
under the Investment Advisers Act of 1940, as amended, is acting as trustee
or agent, (f) any investment company or business development company, as
defined in the Investment Company Act of 1940, as amended, (g) any small
business investment company licensed under the Small Business Investment Act
of 1958, as amended, (h) any broker or dealer registered under the Securities
Exchange Act of 1934, as amended, or any investment adviser registered under
the Investment Adviser Act of 1940, as amended, (i) any corporation,
partnership, Massachusetts or similar business trust or common or collective
investment vehicle, (j) any government, any public employees' pension or
retirement system, or any other government agency supervising the investment
of public funds, (k) any other entity all of the equity owners of which are
Institutional Investors or (1) any other Person which may be within the
definition of "qualified institutional buyer" as such term is used in Rule
144A, as from time to time in effect, promulgated under the Securities Act of
1933, as amended.
"Investment Grade" shall mean a rating of at least "Baa3" in the case of a
rating by ▇▇▇▇▇'▇ and a rating of at least "BBB-" in the case of a rating by
S&P or the then equivalent of such rating by ▇▇▇▇▇'▇ or S&P, as the case may
be.
"Leasehold Mortgaged Property" shall mean the retail discount store more
fully described on Schedule 11, Part B, attached to the Note Agreement in
which the Company holds a leasehold interest, and each and every substitution
and replacement thereof in accordance with the terms and provisions of this
Indenture and the related Mortgage, provided that if any such substitution or
replacement is a Leasehold Mortgaged Property, the ground lease relating
thereto shall be in form and substance satisfactory to the holders of at
least 66-2/3% of the outstanding principal amount of the Notes.
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"Make Whole Amount" shall mean at any time with respect to any prepayment
or payment (whether on account of acceleration or otherwise) of the Notes, to
the extent that the Adjusted Reinvestment Yield at such time is lower than
9.06%, the excess of (a) the present value of the remaining principal and
interest payments to become due on that portion of the Notes to be prepaid or
paid, as the case may be, that would otherwise become due and payable
(without giving effect to such prepayment or payment, as the case may be)
discounted at a rate which is equal to the Adjusted Reinvestment Yield
applicable to such Notes over (b) 100% of the principal amount of such Notes
then to be prepaid or paid, as the case may be, plus accrued interest thereon
to the date of prepayment. To the extent that the Adjusted Reinvestment
Yield at the time of such prepayment or payment, as the case may be, is equal
to or higher than 9.06% the Make Whole Amount is zero.
"Adjusted Reinvestment Yield" shall mean the Reinvestment Yield
plus .50%.
"Reinvestment Yield" shall be the arithmetic mean of the rates
published in the Statistical Release under the caption "U.S. Government
Securities Treasury Constant Maturities" for the maturity corresponding
to the remaining Weighted Average Life to Maturity of such Notes to be
prepaid or paid, as the case may be, as of the date of such payment or
prepayment, as the case may be, rounded to the nearest month. If no
maturity exactly corresponds to the rounded Weighted Average Life to
Maturity of such Notes to be prepaid or paid, as the case may be, yields
for the two most closely corresponding published maturities next above
and below the rounded Weighted Average Life to Maturity of such Notes to
be prepaid or paid, as the case may be, shall be calculated pursuant to
the immediately preceding sentence and the Reinvestment Yield shall be
interpolated for such yields on a straight-line basis, rounding in each
of such relevant periods to the nearest month. For purposes of
calculating the Reinvestment Yield, the most recent Statistical Release
published prior to the date of payment or prepayment, as the case may be,
hereunder shall be used.
"Statistical Release" shall mean the statistical release designated
"H.15(519)" or any successor publication which is published weekly by the
Federal Reserve System and which establishes yields on actively traded
U.S. Government Securities adjusted to constant maturities or, if
such statistical release is not published at the time of any
determination hereunder, then such other reasonably comparable index
which shall be designated by the holders of 51% in aggregate principal
amount of the outstanding Notes being prepaid.
"Weighted Average Life to Maturity" in respect to the Notes shall
mean, as at the time of determination, the number of years obtained by
dividing the then Remaining Dollar-years of the Notes, by the outstanding
principal amount of such Notes. The term "Remaining Dollar-years" of
the Notes means the amount obtained by (a) multiplying (1) the amount of
each then remaining required principal payment (including repayment at
final maturity), by (2) the
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number of years (calculated to the nearest one-twelfth) which will elapse
between the time of determination and the date such required repayment is
due, and (b) totaling all the products obtained in (a).
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc. or any
successor thereto.
"Mortgaged Property" shall mean individually each of the Fee-Owned
Mortgaged Properties or the Leasehold Mortgaged Property. "Mortgaged
Properties" shall mean collectively all of the Mortgaged Properties.
"Mortgage" shall mean individually (a) each mortgage, deed of trust, deed
to secure debt or similar instrument executed and delivered by the Company on
the Closing Date under the Note Agreements and (b) each mortgage, deed of
trust, deed to secure debt or similar security instrument executed in
connection with the substitution or replacement of any Mortgaged Property, as
any thereof may from time to time be supplemented or amended. "Mortgages"
shall mean collectively all of the Mortgages.
"Multiemployer Plan" shall have the meaning assigned thereto in ERISA.
"Note Agreements" shall mean the separate and several Note Agreements,
each dated as of January 1, 1992 between the Company and the Initial
Purchasers, respectively.
"Noteholder Notice" shall have the meaning set forth in Section 5.5(a).
"Notes" shall have the meaning specified in the Recitals.
"Officers' Certificate" shall mean a certificate signed by any two of the
President, any Vice President, the Treasurer or the Secretary of the Company.
"Opinion of Counsel" shall mean an opinion in writing signed by
independent legal counsel who shall be satisfactory to the Corporate
Trustee, and who may be independent counsel to the Company.
"Outstanding" when used with reference to Notes shall mean, as of any
particular time, all Notes authenticated and delivered by the Corporate
Trustee under this Indenture, except:
(a) Notes cancelled by the Corporate Trustee or delivered to the
Corporate Trustee for cancellation;
(b) Notes purchased or otherwise acquired by the Company or any of
its Subsidiaries or Affiliates;
(c) Notes in lieu of or in substitution for which other Notes
shall have been authenticated and delivered pursuant to the terms of
Section 2.6.
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"Overdue Rate" shall mean the lesser of (a) the maximum rate permitted by
applicable law and (b) 11.06% per annum.
"Pension Plan" shall mean any "employee pension benefit plan", as such
term is defined in Section 3(2) of ERISA maintained by the Company and its
Subsidiaries for its employees and covered by Title IV of ERISA or to which
Section 412 of the Internal Revenue Code of 1986, as amended, applies, as
from time to time in effect.
"Person" shall mean an individual, partnership, corporation, trust,
unincorporated association or other organization, or a government or any
department or agency thereof.
"Pledge" shall mean to grant a security interest in, mortgage, warrant,
bargain, sell, release, convey, assign, transfer, pledge and/or hypothecate,
all or any as may be necessary to create a first mortgage lien on a Mortgaged
Property.
"Property" shall mean any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"Register" shall have the meaning specified in Section 2.5.
"Reimbursable Expenses" shall mean the unreimbursed out-of-pocket expenses
which have been incurred by the Company in connection with the construction
or acquisition of Improvements of or to any Mortgaged Property, which
Improvements are permitted by Section 2.5 of the Mortgage relating to such
Mortgaged Property but do not constitute repairs or restoration which the
Company is required to make upon such Mortgaged Property pursuant to any
provision of this Indenture or the Mortgage relating to such Mortgaged
Property. The construction of any such Improvements shall have commenced not
earlier than two years prior to the date the Company proposes to issue
Improvement Notes in connection therewith and shall have been completed and
the amount of such Reimbursable Expenses shall not be less than U.S.
$500,000.
"Responsible Officer" shall mean the President, the Executive Vice
President, any Vice President or the Treasurer of the Company.
"Security" shall have the same meaning as in Section 2(l) of the
Securities Act of 1933, as amended.
"S&P" shall mean Standard & Poor's Corporation or any successor thereto.
"Subsidiary" shall mean a corporation:
(a) organized under the laws of the United States or a jurisdiction
thereof, the laws of Canada or a Province thereof or the laws of Puerto
Rico;
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(b) which conducts substantially all of its business and has
substantially all of its Property within the United States, Canada or
Puerto Rico; and
(c) at least 50% (by number of votes) of the Voting Stock of which
is legally and beneficially owned by the Company and its Wholly-Owned
Subsidiaries.
"Title Company" shall mean First American Title Insurance Company or such
other nationally recognized title insurance company which shall be acceptable
to the holders of at least 51% of the outstanding principal amount of the
Notes.
"Total Cost" of a Mortgaged Property shall mean the sum of (a) the actual
construction cost and purchase price, including the cost of land, buildings,
signs, landscaping, architectural and engineering fees and the cost of any
improvements made thereto, whether financed by Improvement Notes, if any, or
otherwise, but excluding the cost of trade fixtures, furniture and equipment
and (b) all fees and expenses referred to in Section 9 of the Note Agreements
allocated by the Company to such Mortgaged Property and the physical survey
and title charges referred to in Section 6(c) and 6(g) of the Note Agreements
in respect of such Mortgaged Property incurred by the Company in connection
with the acquisition of such Mortgaged Property and, the construction of the
buildings and improvements thereon; provided that the aggregate amount of the
fees, expenses, charges and costs described in this clause (b) and included
in the Total Cost of such Mortgaged Property shall not exceed 10% of the
aggregate amount thereof.
"U.S.$" or "U.S. Dollars" shall mean lawful currency of the United States
of America in same day immediately available freely transferable funds.
"Voting Stock" shall mean Securities of any class or classes of a
corporation the holders of which ordinarily, in the absence of contingencies,
are entitled to elect a majority of the corporate directors (or Persons
performing similar functions).
"Wholly-Owned Subsidiary" shall mean any Subsidiary of which all of the
equity Securities (except directors' qualifying shares) are owned by the
Company and/or the Company's other Wholly-Owned Subsidiaries.
Section 1.2. Accounting Principles. Where the character or amount of any
asset or liability or item of income or expense is required to be determined or
any consolidation or other accounting computation is required to be made for
the purposes of this Indenture, the same shall be done in accordance with
United States GAAP, to the extent applicable.
Section 1.3. Directly or Indirectly. Where any provision in this Indenture
refers to action to be taken by any Person, or which such Person is prohibited
from taking, such provision shall be applicable whether the action in question
is taken directly or indirectly by such Person.
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SECTION 2. THE NOTES.
Section 2.1. Description of Notes. (a) There is hereby created under this
Indenture, a series of Notes entitled "9.06% Senior Secured Notes due February
1, 2012" limited to U.S. $71,417,590.00 in aggregate principal amount,
exclusive of the principal amounts of Secured Notes issued pursuant to Sections
2.2 and 2.6 hereof. The Notes shall be issuable as fully registered Notes in
the forms attached hereto as Exhibit A.
(b) The Notes shall be dated the date of issuance thereof (except in the
case of Notes issued pursuant to Section 2.6), shall bear interest on the
unpaid principal amount thereof at the rate of 9.06% per annum and at the
Overdue Rate on any overdue principal thereof and on any overdue premium and
(to the extent permitted by law) any overdue interest thereon (computed, in
each case, on the basis of a 360-day year of twelve 30-day months).
(c) The Notes will be expressed to mature as follows:
(1) an installment of interest only for the period from and including the
date of issue to but not including February 1, 1992, payable on February 1,
1992;
(2) two hundred thirty-nine (239) equal installments, including both
principal and interest, each in an amount equal to .903589% of the original
principal amount of such Notes, payable monthly on March 1, 1992 and on the
first day of each month thereafter to and including January 1, 2012; and
(3) a final installment on February 1, 2012 in an amount equal to the
entire principal and interest remaining unpaid as of said date.
(d) Interest, premium, if any, and principal payments in respect of the
Initial Notes will be made by the Company on the respective dates for the
payment thereof by deposit with the Corporate Trustee or by bank wire transfer
of Federal reserve funds or other funds current and immediately available to
the Corporate Trustee in its account in XXX, each such payment to be made in
sufficient time (but in any event not later than 11:00 a.m. New York, New York
time) so as to permit the Corporate Trustee to satisfy the requirements of
Section 2.4(b).
(e) The Notes and the Corporate Trustee's certificate of authentication to
be borne by the Notes shall be substantially of the tenor and purport as set
forth in Exhibit A hereto, and the Initial Notes may have such letters, numbers
or other marks of identification or designation and such legends or
endorsements thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Indenture, or as may be required to
comply with any law or any rule or regulation made pursuant thereto, and in any
such event as are acceptable to the holders of at least 66-2/3% of the
outstanding principal amount of the Initial Notes.
Section 2.2. Improvement Notes. (a) From time to time the Company may, on
the date for payment of an installment of principal and interest, issue
Improvement Notes (the
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"Improvement Notes") with respect to any of the Mortgaged Properties to finance
the Reimbursable Expenses of the Company with respect to such Improvements,
subject to compliance with the provisions of subsection (c) below and the
rights of the Initial Purchasers under the Note Agreements and provided that
the aggregate original principal amount of each series of Improvement Notes (1)
is not less than U.S. $500,000, and (2) does not exceed 100% of the Company's
Reimbursable Expenses in respect of such Improvements. Each series of
Improvement Notes will be issued solely for the purpose of financing the
Company's Reimbursable Expenses incurred with respect to Improvements to the
Mortgaged Properties. All such Improvement Notes issued by the Company on any
one date shall constitute a separate series of Improvement Notes hereunder.
The Company shall deliver such Improvement Notes to the Corporate Trustee for
authentication, and such Improvement Notes shall be authenticated by the
Corporate Trustee and delivered in accordance with the order of the Company
evidenced by an Officers' Certificate.
(b) Each series of Improvement Notes shall be created and designated as
shall be prescribed by the supplemental indenture creating such series referred
to in clause (4) of subsection (c) below, and the Improvement Notes of such
series shall:
(1) be in such form, bear interest on the unpaid principal amount thereof
at such rate, and be subject to such prepayments at the option of the Company
(in addition to any prepayments as provided in Section 5), as shall be
prescribed in such supplemental indenture;
(2) not exceed 100% of the Company's Reimbursable Expenses with respect to
the related Improvements to a Mortgaged Property;
(3) not provide for prepayments of principal at a rate greater than that
provided in respect of the Initial Notes and not mature earlier than the
maturity date of the Initial Notes;
(4) not have a Weighted Average Life to Maturity shorter than the then
remaining Weighted Average Life to Maturity of the Initial Notes;
(5) be dated the date of issue (except in the case of Improvement Notes
issued in exchange for or in lieu of Improvement Notes pursuant to Section
2.6) and shall be payable on the first of each calendar month in each year
subsequent to the date thereof, to and including the maturity date thereof in
monthly installment payments of principal and interest in amounts such that
upon the due payment of all such installments there shall have been paid to
each holder of such Improvement Note 100% of the principal amount thereof,
together with all accrued interest thereon;
(6) be offered to the Initial Purchasers upon the terms and conditions
provided in Section 8 of the Note Agreements prior to their issuance, sale
and delivery to any other Person or Persons; provided that neither the
Company nor any agent on its behalf shall offer such Improvement Notes for
sale to, or solicit any offers to buy such Improvement Notes from, or
otherwise approach or negotiate in
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respect of such Notes with, any Person or Persons so as to require
registration of such Improvement Notes under the provisions of Section 5 of
the Securities Act of 1933, as amended, or so as to require the qualification
of this Indenture under the Trust Indenture Act of 1939, as amended; and
provided further that if the Initial Purchasers do not accept such offer,
that portion of the Improvement Notes not so accepted may be offered to any
Institutional Investor or Investors; and
(7) be secured equally and ratably with all other Notes issued and
outstanding hereunder by, and be entitled to the benefits of, this Indenture.
(c) Each of such series of Improvement Notes may be issued hereunder only if
prior to or concurrently with the issuance thereof, the purchaser of such
Improvement Notes and the holders of the Initial Notes and the Corporate
Trustee shall have received the following:
(1) the prior written consent of the holders of at least 70% of the
outstanding principal amount of the Notes if the aggregate principal amount
of such series of Improvement Notes when added to the aggregate principal
amount of all other series of Improvement Notes theretofor issued pursuant to
this Section 2.2 equals or exceeds 49% of the sum of (i) the original
principal amount of the Initial Notes plus (ii) the original principal amount
of all series of Improvement Notes theretofor issued pursuant to this Section
2.2 plus (iii) the original principal amount of the series of Improvement
Notes then to be issued pursuant to this Section 2.2, in each such case
computed based upon 1991 U.S. Dollars held constant;
(2) a resolution of the Board of Directors or of the Executive
Committee of the Board of Directors of the Company authorizing the
issuance of a specified principal amount of such Improvement Notes;
(3) an Officers' Certificate dated the date of issuance of such
Improvement Notes, setting forth in reasonable detail the amount and
character of the Reimbursable Expenses with respect to which, and a
description of the Improvements in respect of which, such Improvement Notes
are to be issued, and stating that: (i) the construction of the Improvements
has been completed, specifying the dates on which the construction of such
Improvements was commenced and completed, which in each such case shall be
not more than 24 months prior to the date of issuance of such Improvement
Notes, (ii) 100% of such Reimbursable Expenses are reimbursable in the
principal amount of Improvement Notes then to be issued, (iii) the principal
amount of the Improvement Notes then to be issued does not exceed such
Reimbursable Expenses, and (iv) no Default or Event of Default has occurred
and is continuing;
(4) an indenture supplemental hereto creating such series of
Improvement Notes (herein called a "Supplemental Indenture") in form and
substance satisfactory to the Trustees and their counsel, duly authorized,
executed and delivered by the Company;
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(5) a supplement (herein called the "Mortgage Supplement") to the
Mortgage to which the Improvements financed with the proceeds of such
Improvement Notes relate, in form and substance satisfactory to the
Trustees and their counsel, duly authorized, executed and delivered by
the Company, which Mortgage Supplement shall as of the date of the
issuance of such Improvement Notes, (i) increase the lien of such
Mortgage by an amount equal to the original principal amount of the
Improvement Notes, (ii) provide for such Mortgage to secure the
Improvement Notes, and (iii) subject the Improvements and the additional
land, if any, financed by the issuance of the Improvement Notes to the
lien of such Mortgage;
(6) an opinion of counsel for the Company satisfactory to the
Trustees and in form and substance satisfactory to the Trustees and dated
the date of issuance of such Improvement Notes, to the effect that:
(i) all requirements of this Indenture which must be satisfied by the
Company prior to the issuance of such Improvement Notes have been
satisfied, (ii) the Supplemental Indenture and the Mortgage Supplement
have been duly authorized, executed and delivered by the Company and
constitute legal, valid and binding instruments enforceable in accordance
with their respective terms, and the Trustees may properly execute and
deliver the Supplemental Indenture, (iii) such Improvement Notes have
been duly authorized, executed and delivered by the Company and are
legal, valid and binding obligations of the Company enforceable in
accordance with the terms thereof and of this Indenture, as so
supplemented, and are entitled to the benefits and security of the
Indenture, as supplemented by the Supplemental Indenture, (iv) the
Mortgage Supplement and all financing statements or similar notices
thereof if and to the extent permitted or required by applicable law have
been filed for record and/or recorded in the manner and place required by
law in order to establish, preserve and protect the first lien of the
Mortgage, as so supplemented (or in lieu of the opinion described in this
clause (iv), an endorsement to the related mortgage title insurance
policy to the same such effect), (v) no approval, consent or withholding
of objection on the part of, or filing, registration or qualification
with any governmental body, Federal, state or local, is necessary in
connection with the execution and delivery by the Company of the
Mortgage, as supplemented by the Mortgage Supplement, the Indenture, as
supplemented by the Supplemental Indenture, or the Improvement Notes or
the performance by the Company of any of the matters required of the
Company thereunder or hereunder, (vi) the issuance and sale of the
Improvement Notes and compliance by the Company with all of the
provisions of the Indenture, as supplemented by the Supplemental
Indenture, and the Mortgage, as supplemented by the Mortgage Supplement,
will not conflict with or result in any breach of any of the provisions
of or constitute a default under or result in the creation or imposition
of any lien on any of the Trust Estate pursuant to the provisions of the
Articles of Incorporation or by-laws of the Company or any agreement or
other instrument known to such counsel to which the Company is a party or
by which the Company may be bound, (vii) the issuance, sale and delivery
of the Improvement Notes by the Company is an exempt transaction under
the Securities Act of 1933, as amended; and existing law does not require
the registration of the Improvement Notes under said Securities Act or
qualification of this Indenture, as supplemented by the Supplemental
Indenture, under the Trust Indenture Act of
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1939, as amended, and (viii) such other matters incident to the issuance
and sale of such Improvement Notes as the Trustees may request.
Such opinion may be subject to the qualifications that the
instruments referred to in this clause (6) are subject to applicable
bankruptcy, reorganization and other laws of general application relating
to or affecting the enforcement of creditors' rights or the enforcement
of the security provided by such instruments, and certain remedies under
the Indenture, as supplemented by the Supplemental Indenture, or such
Mortgage, as so supplemented, may be qualified by applicable state laws,
none of which qualifications will materially interfere with the practical
realization of the benefits or the security provided by the Indenture, as
supplemented by the Supplemental Indenture and the Mortgage, as so
supplemented;
(7) if applicable, a revised survey in respect of the Mortgaged
Property to which such Improvements relate which shall show (i) any
easements arising on the real Property after the date of the
original survey and (ii) no encroachments upon the real Property upon
which the same is located by adjoining buildings or structures and no
encroachments on adjoining premises by the buildings or improvements,
including the Improvements, erected thereon;
(8) if applicable, a "date down" endorsement to the policy of
mortgage title insurance in respect of the Mortgaged Property, which
"date down" endorsement shall increase the coverage of such policy on
and after the date of issuance of the Improvement Notes by an amount
equal to the original principal amount of such Improvement Notes, redate
such policy as of the date of issuance of such Improvement Notes, and
specify as exceptions in such policy only such liens as are permitted by
the original mortgage title insurance policy;
(9) if applicable, a down-date in form and substance satisfactory
to the Corporate Trustee and its counsel of the environmental audit
report with respect to the Mortgaged Property to which such
Improvements relate delivered on the Closing Date to the holders of the
Initial Notes; and
(10) such other opinions, reports, certificates and other
instruments as the Corporate Trustee, the purchasers of such Improvement
Notes or the holders of the Notes may reasonably request.
The Company shall pay all reasonable costs, charges and expenses in any way
relating to or incurred in connection with the issuance of any series of
Improvement Notes, including reasonable attorneys' fees and expenses of the
Trustees, the holders of the Notes and the Institutional Investors which will
purchase the Improvement Notes, recording fees, premiums covering title
insurance and all applicable taxes which may be incurred or imposed by reason
of the transactions contemplated by the issuance of Improvement Notes.
(d) The Improvement Notes of each series may have such letters,
numbers or other marks of identification and such legends or endorsements
thereon as the Company may determine with the approval of the Corporate
Trustee and as are not inconsistent with the
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provisions of this Indenture, or as may be required to comply with any law or
any rule or regulation made pursuant thereto, and in any such event as are
acceptable to the holders of at least 66-2/3% of the outstanding principal
amount of the Notes.
(e) The Trustees shall provide written notice of the issuance of each series
of the Improvement Notes to the holders of the Notes. Without limiting the
foregoing, the Trustees shall furnish copies of any of the instruments,
opinions or other showings delivered in connection with the issuance of any
such series of Improvement Notes to any holder of the Notes upon written
request therefor.
Section 2.3. Denominations; Execution of Notes; Certificate of
Authentication. Each Note shall be in the denomination of U.S. $500,000 or any
multiple of U.S. $100,000 in excess of U.S. $500,000, except as may be
necessary to reflect any principal amount not evenly divisible by U.S.
$100,000. The Notes shall be signed on behalf of the Company by its President
or any of its Vice Presidents, under its corporate seal attested by its
Secretary or an Assistant Secretary. In case any officer who shall have signed
any Note shall cease to be such officer before such Note shall have been
authenticated by the Corporate Trustee or delivered by the Company, such Notes
may nevertheless be executed and delivered with the same force and effect as
though the Person or Persons who signed such Note had not ceased to be such
officer of the Company; and any Note may be signed on behalf of the Company by
a Person who, at the actual date of execution of such Note, shall be a proper
officer of the Company, although at the date of such Note, such Person was not
then such officer of the Company. Only such Notes as shall bear thereon a
certificate of authentication substantially in the form set forth in Exhibit A
hereto shall be entitled to the benefits of this Indenture or be valid or
obligatory for any purpose. Such certificate by the Corporate Trustee upon any
Note executed by the Company shall be conclusive evidence that the Note so
authenticated has been duly authenticated and delivered hereunder and that the
holder is entitled to the benefits of this Indenture. The authentication by
the Corporate Trustee of any Note issued hereunder shall not be construed as a
representation or warranty by the Trustees as to the validity or security of
this Indenture or of such Note, and the Trustees shall in no respect be liable
or answerable for the use made of such Note or the proceeds thereof.
Section 2.4. Payment of the Notes. (a) The principal of, premium, if any, and
interest on the Notes shall be payable at the principal office of the Corporate
Trustee, in lawful money of the United States of America.
(b) Notwithstanding the provisions of the preceding paragraph (a), if any
Note is held by an Initial Purchaser or any Institutional Investor or any
Person affiliated with any of the foregoing or is registered in the name of any
holder named in a written notice from the Company to the Corporate Trustee and
stating that the provisions of this Section 2.4(b) shall apply, the Corporate
Trustee shall make payment of interest on such Notes and shall make payments or
prepayments, as the case may be, of the principal thereof, and any premium, if
any, immediately upon receipt thereof from the Company but, in any event,
before 12:00 Noon, New York, New York time on the date of receipt thereof
(subject to timely receipt of such payment or prepayment from the Company as
provided in Section 2.1(d) hereof), by wire transfer in immediately available
Federal reserve funds as set forth in Schedule I to the
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Note Agreements in the case of the Initial Purchasers or as shall be specified
in writing to the Corporate Trustee by such holder. All payments so made shall
be valid and effective to satisfy and discharge the liability upon such Note to
the extent of the sums so paid. The Corporate Trustee is authorized to act in
accordance with the foregoing provisions and shall not be liable or responsible
to any such holder or to the Company or to any other Person for any act or
omission on the part of the Company or such holder in connection therewith.
Section 2.5. The Register. The Company shall cause to be kept at the
principal office of the Corporate Trustee a register for the registration and
transfer of Notes (herein called the "Register"). The names and addresses of
the holders of the Notes, the transfers of the Notes and the names and
addresses of the transfers of all Notes shall be registered in the Register.
Section 2.6. Transfers and Exchanges. (a) The holder of any Note may transfer
such Note upon the surrender thereof at the principal office of the Corporate
Trustee. Thereupon, the Company shall execute in the name of the transferee a
new Note or Notes in aggregate principal amount equal to the aggregate unpaid
principal amount of the Note so surrendered, and the Corporate Trustee shall
authenticate and deliver such new Note or Notes to such transferee.
(b) The holder of any Note may at any time surrender such Note at the
principal office of the Corporate Trustee in exchange for an equal aggregate
principal amount of Notes in any authorized denominations.
(c) All Notes presented or surrendered for exchange or transfer shall be
accompanied by a written instrument or instruments of assignment or transfer,
in form reasonably satisfactory to the Corporate Trustee, duly executed by the
registered holder or by its attorney duly authorized in writing. The Company
and the Corporate Trustee shall not be required to make a transfer or an
exchange of any Note for a period of 10 days preceding any payment date with
respect thereto.
(d) In case any Note shall become mutilated or be destroyed, lost or stolen,
the Company, upon the written request of the holder thereof, shall execute and
the Corporate Trustee shall authenticate and deliver, a new Note in exchange
and substitution for the mutilated Note, or in lieu of and in substitution for
the Note so destroyed, lost or stolen, which new Note shall be in an aggregate
principal amount equal to the aggregate unpaid principal amount of such
destroyed, lost or stolen Note. In every case the applicant for a substituted
Note shall furnish to the Company and to the Corporate Trustee such security or
indemnity as may be required by them to save each of them harmless from all
risks, and the applicant shall also furnish to the Company and to the Corporate
Trustee evidence to their satisfaction of the mutilation, destruction, loss or
theft of the applicant's Note and of the ownership thereof. In case any Note
which has matured or will mature within 30 days shall become mutilated or be
destroyed, lost or stolen, the Company may, instead of issuing a substituted
Note, pay or authorize the payment of the same (without surrender thereof
except in the case of a mutilated Note), if the applicant for such payment
shall furnish to the Company and to the Trustees such security or indemnity as
they may require to save them
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harmless, and evidence to the satisfaction of the Company and the Corporate
Trustee of the destruction, loss or theft of such Note and of the ownership
thereof. If an Institutional Investor or its nominee is the owner of any
destroyed, lost or stolen Note, then the affidavit of its President, Vice
President, Assistant Vice President, Treasurer or any other Person authorized
to act on behalf of such Institutional Investor setting forth the fact of
destruction, loss or theft and the Institutional Investor's ownership of the
Note at the time of such destruction, loss or theft shall be accepted as
satisfactory evidence thereof and no indemnity shall be required as a condition
to execution and delivery of a new Note other than the written agreement of
such Institutional Investor to indemnify the Company and the Trustees.
(e) No notarial act shall be necessary for the transfer or exchange of any
Note pursuant to this Section 2.6, and the holder of any Note issued as
provided in this Section 2.6 shall be entitled to any and all rights and
privileges granted under this Indenture to a holder of a Note.
Section 2.7. The New Notes. (a) Each new Note (herein in this Section 2.7
called a "New Note") issued pursuant to Section 2.6(a), (b) or (d) in exchange
for or in substitution or in lieu of an outstanding Note (herein in this
Section 2.7 called an "Old Note") shall be dated the date of such Old Note.
The Corporate Trustee shall ▇▇▇▇ on each New Note (1) the date to which
principal and interest have been paid on such Old Note, and (2) all payments
and prepayments of principal previously made on such Old Note which are
allocable to such New Note. Interest shall be deemed to have been paid on such
New Note to the date on which interest shall have been paid on such Old Note,
and all payments and prepayments of principal marked on such New Note, as
provided in clause (2) above, shall be deemed to have been made thereon.
(b) Upon the issuance of a New Note pursuant to Section 2.6(a), (b) or (d),
the Company may require the payment of a sum to reimburse it for, or to provide
it with funds for, the payment of any tax or other governmental charge or any
other charges and expenses connected therewith which are paid or payable by the
Company in connection with the transfer or exchange.
(c) All New Notes issued pursuant to Section 2.6(a), (b) or (d) in exchange
for in substitution or in lieu of Old Notes shall be valid obligations of the
Company evidencing the same outstanding debt as the Old Notes and shall be
entitled to the benefits and security of this Indenture to the same extent as
the Old Notes.
Section 2.8. Cancellation of Notes. All Notes surrendered for the purpose of
payment, redemption, transfer or exchange shall be delivered to the Corporate
Trustee for cancellation or, if surrendered to the Corporate Trustee, shall be
cancelled by it, and no Notes shall be issued in lieu thereof except as
expressly required or permitted by any of the provisions of this Indenture. The
Corporate Trustee shall hold all such cancelled Notes until this Indenture
shall have been discharged, at which time the Corporate Trustee shall either
deliver such cancelled Notes in a manner necessary to effect the discharge and
release of this Indenture of record or, if no such delivery is necessary, shall
deliver such cancelled Notes to the Company. The Corporate Trustee shall
deliver a certificate to the Company specifying
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any cancellation of Notes which has been made. If the Company shall acquire
any of the Notes, however, such acquisition shall not operate as a redemption
or satisfaction of the indebtedness represented by such Notes unless and until
the same are surrendered to the Corporate Trustee for cancellation.
Section 2.9. Corporate Trustee as Agent. The Corporate Trustee is
hereby appointed the agent of the Company for the payment, registration,
transfer and exchange of Notes. Subject to the provisions of Section 2.4(b),
the Notes may be presented at, and notices or demands with respect to the Notes
or this Indenture may be served or made at, the principal office of the
Corporate Trustee, provided that copies of all such notices or demands shall be
delivered to the Company.
Section 2.10. Ownership. The Person in whose name any Note shall be
registered shall be deemed and treated as the owner thereof for all purposes of
this Indenture and neither the Company nor the Corporate Trustee shall be
affected by any notice to the contrary. Payment of or on account of the
principal of, premium, if any, and interest on such Note shall be made only to
or upon the order in writing of such registered owner. For the purpose of any
request, direction or consent hereunder, the Company and the Corporate Trustee
may deem and treat the registered owner of any Note as the owner thereof
without production of such Note.
SECTION 3. PARTICULAR COVENANTS OF THE COMPANY.
From and after the Closing Date and continuing so long as any amount
remains unpaid on any Note or due or owing under this Indenture or any
Mortgage, the Company covenants with the Trustees for the benefit of the
Trustees and the holders of the Notes as follows:
Section 3.1. Warranty of Title. Subject only to the lien of the
Mortgages and liens permitted thereby, the Company has good and marketable
title in fee simple to all of the Mortgaged Properties (other than the
Leasehold Mortgaged Property) and is lawfully possessed of all of the Mortgaged
Properties and has and will continue to have full right, power and lawful
authority to Pledge the Mortgaged Properties, and the Trustees have as of the
Closing Date and will continue to have a valid and enforceable first priority
lien on the same, and the Company will warrant and defend title thereto to the
Trustees against claims of all Persons whomsoever.
Section 3.2. Payment of Principal, Premium and Interest. The Company
will duly and punctually pay the principal of, premium, if any, and interest
(including interest at the Overdue Rate if due and owing on the Notes) on, each
and every Note, at the dates and the places and in the manner mentioned in the
Notes and in this Indenture, according to the true intent and meaning thereof
and hereof.
Section 3.3. Office for Notices. The Company will keep an office
while any of the Notes issued hereunder are outstanding, at Troy, Michigan
where notices, presentations and/or demands to or upon the Company in respect
of said Notes, the Note Agreements, the Mortgages or this Indenture may be
given or made, until such time as the Company shall so
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notify the Corporate Trustee and the holders of the Notes of any change of
location of such office.
Section 3.4. Note Agreement and Mortgage Covenants. Each and all of
the terms, provisions, restrictions, covenants and agreements set forth in the
Note Agreements and the Mortgages, and in each and every supplement thereto or
amendment thereof which may at any time or from time to time be executed and
delivered by the parties thereto or their successors and assigns, are
incorporated herein by reference to the same extent as though each and all of
said terms, provisions, restrictions, covenants and agreements were fully set
out herein and as though any amendment or supplement to the Note Agreements and
the Mortgages were fully set out in an amendment or supplement to this
Indenture; and the Company does hereby covenant and agree well and truly to
abide by, perform and be governed and restricted by each and all of the matters
provided for by the Note Agreements and the Mortgages and so incorporated
herein to the same extent and with the same force and effect as if each and all
of said terms, provisions, restrictions, covenants and agreements so
incorporated herein by reference were set out and repeated herein at length.
Section 3.5. Maintenance of Corporate Existence, Rights. The Company
will at all times preserve its corporate existence (except as otherwise
permitted by Section 3.12 hereof) and will obtain and maintain in full force
and effect all franchises, privileges, rights, licenses and permits and all
other consents, approvals and authorizations of any governmental authority
necessary for the ownership and efficient operation and maintenance of its
business and Property which failure to obtain and maintain would materially
affect adversely the Properties (including the Mortgaged Properties), business,
prospects, profits, operations or condition (financial or otherwise) of the
Company.
Section 3.6. Maintenance of Lien; Recording. (a) The Company will, at
its expense, take all necessary action to maintain and preserve the first and
prior perfected lien of this Indenture and the Mortgages (including, without
limitation, the filing of all financing statements or similar notices thereof
if and to the extent permitted or required by applicable law) so long as any
Notes are outstanding.
(b) The Company will, forthwith after the execution and delivery
of this Indenture and each and every Mortgage and thereafter from time to time,
cause this Indenture and each Mortgage (and all financing statements or similar
notices thereof if and to the extent permitted or required by applicable law)
to be filed, registered and recorded in such manner and in such places as may
be required by law in order to publish notice of and fully to protect the lien
of the Trustees in and to the Mortgaged Properties; and from time to time will
perform or cause to be performed any other act as provided by law and will
execute or cause to be executed any and all further instruments that may be
requested by the Trustees or any of them for such publication and protection.
The Company will, within 10 days after any such filing, registering, recording
or other act, furnish the Trustees with an Opinion of Counsel as to the
adequacy and reciting the details of such filing, registering, recording or
other act and specifying any re-recording or refiling to be effected in the
future with respect to this Indenture or such Mortgage. The Company will pay
or cause to be paid all filing, registration and recording taxes and fees
incident to such filing, registration and recording,
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and all expenses incident to the preparation, execution and acknowledgment of
this Indenture and each Mortgage (and all financing statements or similar
notices thereof if and to the extent permitted or required by applicable law),
and of any instrument of further assurance, and all Federal or state stamp
taxes and other taxes, duties, imposts, assessments and charges arising out of
or in connection with the execution and delivery of this Indenture and each
Mortgage and such instrument of further assurance.
Section 3.7. Further Assurances; Right of Trustees to Perform
Covenants. (a) The Company will do, execute, acknowledge and deliver, or cause
to be done, executed, acknowledged and delivered, all such further acts, deeds,
conveyances, mortgages, financing and continuation statements, assignments,
transfers and assurances as the Corporate Trustee reasonably may require for
the perfection of the lien being herein provided for in the Mortgaged
Properties.
(b) If the Company shall fail to make any payment or perform any
act required to be made or performed hereunder, the Trustees, after five
Business Days' prior written notice to the Company and without waiving or
releasing any obligation or Default, may (but shall be under no obligation to)
at any time thereafter make such payment or perform such an act for the account
and at the expense of the Company, as, in the opinion of the Trustees, may be
necessary or appropriate. All sums so paid by the Trustees and all costs and
expenses (including without limitation, reasonable attorneys' fees and
expenses) so incurred, together with interest thereon at the Overdue Rate from
the date of payment or incurrence, shall be secured hereby and shall be paid by
the Company to the Trustees on demand.
Section 3.8. Maintenance of Property. (a) The Company will at all
times maintain, preserve and keep, and will cause each Subsidiary to maintain,
preserve and keep, its Property (whether owned in fee or a leasehold interest)
in good condition and working order and make all necessary repairs, renewals,
replacements, additions, betterments and improvements thereto in order that the
business carried on in connection therewith may be properly conducted at all
times; provided that nothing contained in this Section 3.8 shall prevent the
sale, abandonment or other disposition of any Property (other than the
Mortgaged Properties) in the ordinary course of business.
(b) Anything contained in Section 3.8(a) to the contrary
notwithstanding, the Company may discontinue the retail operations at any
Mortgaged Property and permit such Mortgaged Property to remain unused (for
purposes of this Section 3.8(b) "go dark" or "remain dark"); provided that (1)
the Company takes appropriate precautions to secure the Mortgaged Property
against damage by vandalism, neglect or waste, (2) the Company continues to
insure the Mortgaged Property in accordance with the requirements of Section
2.6 of the related Mortgage, (3) such determination by the Company to go dark
is made in the ordinary course of the Company's business, (4) no more than two
Mortgaged Properties may remain dark during any one period, (5) no Mortgaged
Property may remain dark for a period in excess of 6 months; provided, however,
that a Mortgaged Property may remain dark for a period of 30 days in excess of
6 months, if the Company shall, within such 30 day period, elect to either (i)
prepay an amount of the outstanding Notes equal to the Loan Value (as defined
in the Mortgages) of such Mortgaged Property, together with the
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premium, if any, and interest accrued thereon to the date of payment in
accordance with the provisions of Section 5.6 hereof or (ii) substitute a
Substitute Financed Property (as defined in the Mortgages) for such Mortgaged
Property in accordance with the provisions of Section 3.4 of the related
Mortgage and (6) at the time the Company determines to have a Mortgaged
Property go dark, no Default or Event of Default shall have occurred and be
continuing. The Company shall give notice to the Trustees and each holder of
the Notes of its determination to let a Mortgaged Property go dark within 30
days of such determination.
Section 3.9. Insurance. Without limiting the terms and provisions of
the Mortgages, the Company will at all times maintain, and will cause each
Subsidiary to maintain, with financially sound and reputable insurers,
insurance with respect to its Properties and business against such casualties
and contingencies, of such types (including, without limitation, fire insurance
and public liability insurance against claims for personal injury or death or
property damage occurring upon, in, about or in connection with the use of any
of its Properties) and in such amounts (including such amounts of
self-insurance) as are customary in the case of prudent corporations of
established reputations engaged in the same or a similar business and similarly
situated. Anything contained in this Section 3.9 to the contrary
notwithstanding, during any period that Consolidated Tangible Net Worth equals
or exceeds Three Billion and 00/100 (U.S. $3,000,000,000 Dollars), the Company
may elect to self-insure with respect to the insurance required to be
maintained by the Company pursuant to this Section 3.9.
Section 3.10. Payment of Taxes and Other Charges. Without limiting
the terms and provisions of the Mortgages, the Company will pay and discharge,
and will cause each Subsidiary to pay and discharge, before they become
delinquent:
(a) all lawful taxes, assessments and governmental charges
or levies imposed upon it or its Property, and
(b) all claims or demands of materialmen, mechanics,
carriers, warehousemen, landlords and other like Persons which, if
unpaid, might result in the creation of a lien upon its Property;
provided that items of the foregoing description need not be paid while being
contested in good faith and by appropriate proceedings and provided further,
that book reserves deemed by it to be adequate have been established with
respect thereto and provided further, that the Company's title to and its right
to use its Property is not materially adversely affected thereby.
Section 3.11. Compliance with Laws. Without limiting the terms and
provisions of any of the Mortgages, the Company will promptly comply and will
cause each Subsidiary to promptly comply with all laws, ordinances or
governmental rules or regulations to which it is subject, including without
limitation, the Occupational Safety and Health Act of 1970, ERISA and all
Environmental Legal Requirements, the violation of which would individually or
in the aggregate be likely to materially affect adversely the Properties
(including the Mortgaged Properties), business, prospects, profits, operations
or condition
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(financial or otherwise) of the Company or any of its Subsidiaries or the
ability of the Company to perform its obligations under this Indenture, the
Mortgages and the Notes.
Section 3.12. Mergers and Consolidations. The Company will not
consolidate with or into or be a party to a merger with or into any other
corporation or sell or otherwise dispose of all or substantially all of its
assets, provided that the Company may consolidate with or merge with or into
any other corporation and any other corporation may merge with or into the
Company, if in any such case (a) the corporation resulting from such merger or
consolidation (the "surviving corporation") shall be a corporation organized
under the laws of the United States of America or a jurisdiction thereof, (b)
the surviving corporation shall assume by a written instrument the due and
punctual payment of the principal of, premium, if any, and interest on all of
the Notes and the due and punctual performance and observance of all of the
covenants and conditions of the Company under and in respect of the Notes, the
Note Agreements, the Mortgages and this Indenture and shall furnish to the
holders of the Notes and the Trustees an Opinion of Counsel satisfactory to
such holders and the Trustees to the effect that such instrument has been duly
authorized, executed and delivered and constitutes the legal, valid and binding
contract and agreement of the surviving corporation enforceable in accordance
with its terms, (c) at the time of such consolidation or merger and after
giving effect thereto, and to the creation and delivery of such instrument, no
Default or Event of Default shall exist and (d) the surviving corporation shall
have complied with the requirements of Section 5.5 to the extent applicable.
Section 3.13. Consolidated Tangible Net Worth. The Company will at
all times keep and maintain Consolidated Tangible Net Worth at an amount not
less than Three Billion and 00/100 (U.S. $3,000,000,000) Dollars.
Section 3.14. Maintenance of Rating. The Company will at all times
maintain a credit rating which is Investment Grade in respect of its senior
unsecured indebtedness for borrowed money with ▇▇▇▇▇'▇ or S&P.
Section 3.15. Termination of Pension Plans. The Company will not and
will permit any Subsidiary to withdraw from any Multiemployer Plan or permit
any employee benefit plan maintained by it to be terminated if such withdrawal
or termination could result in withdrawal liability (as described in Part I of
Subtitle E of Title IV of ERISA) or the imposition of a lien, claim or
encumbrance on any Property of the Company pursuant to Section 4068 of ERISA.
Section 3.16. Transactions with Affiliates. The Company will not, and
will not permit any Subsidiary to, enter into or be a party to, any transaction
or arrangement with any Affiliate (including without limitation, the purchase
from, sale to or exchange of Property or assets with, or the rendering of any
service by or for, any Affiliate), except in the ordinary course of and
pursuant to the reasonable requirements of the Company's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to the Company or
such Subsidiary than it would obtain in a comparable arm's-length transaction
with a Person other than an Affiliate.
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Section 3.17. Repurchase of Notes. Neither the Company nor any
Subsidiary nor any Affiliate will, directly or indirectly, repurchase or make
any offer to repurchase any Notes unless the Company or such Subsidiary or
Affiliate has offered to repurchase such Notes, pro rata, from all holders of
the Notes and otherwise upon the terms and conditions set forth in Section 8.2
hereof. In case the Company or any Subsidiary or Affiliate repurchases any
Notes, such Notes shall thereafter be cancelled and no Notes shall be issued in
substitution therefor. Without limiting the foregoing, upon the purchase or
other acquisition of any Notes by the Company, any Subsidiary or any Affiliate,
such Notes shall no longer be outstanding for purposes of any section of the
Note Agreements, this Indenture or any of the Mortgages relating to the taking
by the holders of the Notes of any actions with respect thereto or hereto,
including, without limitation, Sections 6.1, 6.2, 6.13 or 8.2 hereof.
Section 3.18. Financial Information and Reports. The Company will
keep proper books of record and account in which full, true and correct entries
will be made of all dealings or transactions of, or in relation to, the
business and affairs of the Company, in accordance with GAAP consistently
applied (except for changes disclosed in the financial statements furnished to
any holder of outstanding Notes pursuant to this Section 3.18 and concurred in
by the independent public accountants referred to in Section 3.18(b) hereof)
and will furnish to each holder of outstanding Notes and the Trustees in
duplicate:
(a) As soon as available and in any event within 60 days
after the end of each quarterly fiscal period (except the last) of
each fiscal year, copies of:
(1) a consolidated balance sheet of the Company
and its Subsidiaries as of the close of such period, and
(2) consolidated statements of income,
shareholders' equity and cash flows of the Company and its
Subsidiaries for the portion of the fiscal year ending with
such period;
in each case setting forth in comparative form the figures for the
corresponding period of the preceding fiscal year, all in reasonable
detail and certified as complete and correct, subject to changes
resulting from year-end audit adjustments, by the chief accounting
officer of the Company; provided that the Company will have satisfied
the requirements of this Section 3.18(a) by the delivery within the
time period described hereinabove of its quarterly reports on Form
10-Q as filed with the Securities and Exchange Commission so long as
such Form 10-Q contains quarterly statements reflecting the financial
position and results of operations of the Company and its consolidated
Subsidiaries for such quarter,
(b) As soon as available and in any event within 120 days
after the close of each fiscal year of the Company, copies of:
(1) a consolidated balance sheet of the Company and
its Subsidiaries as of the close of such fiscal year, and
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(2) consolidated statements of income,
shareholders' equity and cash flows of the Company and its
Subsidiaries for such fiscal year;
in each case setting forth in comparative form the consolidated
figures for the preceding fiscal year, all in reasonable detail and
accompanied by an opinion thereon of a firm of independent public
accounts of recognized national standing selected by the Company to
the effect that such financial statements present fairly, in all
material respects, the consolidated financial condition of the Company
and its Subsidiaries as of the end of the fiscal year being reported
in and that the consolidated results of the operations and cash flows
for said year are in conformity with GAAP and that the examination of
such accountants in connection with such financial statements has been
conducted in accordance with generally accepted auditing standards and
included such tests of the accounting records and such other auditing
procedures as said accountants deemed necessary in the circumstances;
provided that the Company will have satisfied the requirements of this
Section 3.19(b) by the delivery within the time period described
hereinabove of its annual report on Form 10-K as filed with the
Securities and Exchange Commission so long as such Form 10-K contains
the annual statements reflecting the financial position and results of
operations of the Company and its consolidated Subsidiaries for such
year;
(c) Promptly upon their becoming available, one copy of
each financial statement, report, notice or proxy statement sent by
the Company to stockholders generally and of each Form 8-K and, upon
the written request of the Trustees or any of the holders of the
Notes, any other periodic reports (other than Form S-8 or any other
form relating to employee benefit plans or dividend reinvestment
plans) registration statement or prospectus filed by the Company or
any Subsidiary with any Securities exchange or the Securities and
Exchange Commission or any successor agency;
(d) Within the period provided in paragraph (b) above,
the written statement of the Company, signed by an authorized
financial officer, stating whether there existed as of the date of
such financial statements and whether, to the best of his knowledge,
there exists on the date of the certificate any Default or Event of
Default under this Indenture, the Note Agreements or any Mortgage and
specifying the nature and period of existence thereof and the action
the Company is taking and proposes to take with respect thereto;
(e) Within the period provided in paragraph (b) above, a
certificate of the accountants who render an opinion with respect to
such financial statements, stating that they have reviewed this
Indenture and stating further whether, in making their audit, anything
came to their attention that caused them to believe that the Company
had failed in compliance or continues to be in noncompliance with the
the terms, covenants, provisions and conditions of this Indenture
insofar as the same relate, pertain to or involve accounting matters
or determinations, and if such condition or event then exists,
specifying the nature and period of existence thereof; and
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(f) With reasonable promptness, such additional financial
information as such holder may reasonably request concerning the
Company or any of its Subsidiaries.
The Company will permit each holder of outstanding Notes (or such Persons as
any such holder may designate) to visit and inspect, under the Company's
guidance, any of the Mortgaged Properties, to examine all the books of account,
records, reports and other papers, to make copies and extracts therefrom and to
discuss its affairs, finances and accounts with its officers, employees and
independent public accountants (and by this provision the Company authorizes
said accountants to discuss with each holder of the Notes the finances and
affairs of the Company), all at such reasonable times and as often as any such
holder may reasonably desire. Any visitation or inspection or discussion with
the accountants shall be at the sole expense of such holder of the Notes unless
a Default or Event of Default shall have occurred and be continuing, in which
case any such visitation or inspection or discussion with the accountants shall
be at the sole expense of the Company.
Each holder of the Notes by its acceptance thereof agrees that any
information obtained by such Person pursuant to this Section 3.19 will be
treated as confidential; provided, however, that nothing herein contained shall
limit or impair the right or obligation of any Institutional Investor of the
Notes to disclose such information: (1) to its auditors, attorneys, employees
or agents, (2) when required by any law, ordinance or governmental order,
regulation, rule, policy, investigation or any regulatory authority request,
(3) as may be required or appropriate in any report, statement or testimony
submitted to any municipal, state, provincial or Federal regulatory body having
or claiming to have jurisdiction over such Institutional Holder or to the
United States National Association of Insurance Commissioners or similar
organizations or their successors, (4) in connection with the enforcement of
the terms and conditions of this Agreement and the Notes, (5) which is publicly
available or readily ascertainable from public sources, or which is received by
any Institutional Investor of the Notes from a third Person who or which is not
bound to keep the same confidential, (6) as required by legal process in
connection with any proceeding, case or matter pending (or on its face
purported to be pending) before any court, tribunal, arbitration board or any
governmental agency, commission, authority, board or similar entity, or (7) to
the extent necessary in connection with any contemplated transfer of any Notes
by any Institutional Investor thereof (it being understood and agreed that any
such transferee which purchases such Notes shall itself be bound by the terms
and provisions hereof).
Section 3.19. Notice of Default. The Company will:
(a) immediately upon becoming aware of the existence of
any condition or event which constitutes a Default or Event of Default
(including without limitation any condition or event which constitutes
the failure of the Company to comply with any provision of Section
2.5(a) of any of the Mortgages); or
(b) immediately upon becoming aware that the holder of any
Note has given notice or taken any other action with respect to a
claimed Default or Event of Default;
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furnish a written notice to each of the holders of the Notes and the Trustees
specifying the nature and period of existence of such condition or event and/or
the notice given or action taken by such holder, as the case may be, and what
action the Company is taking or proposes to take with respect thereto.
Compliance with the provisions of this Section 3.19 shall not be deemed or
construed to constitute a waiver of or consent to any Default or Event of
Default of which the Company has given the Trustees and the holders of the
Notes notice pursuant to this Section 3.19.
SECTION 4. POSSESSION, USE, SUBSTITUTION AND RELEASE OF PROPERTY.
Section 4.1. Company's Right of Possession. Provided no Default or
Event of Default has occurred and is continuing, the Company shall be suffered
and permitted to remain in full possession, enjoyment and control of the
Mortgaged Properties subject always to the observance and performance of the
terms of this Indenture and the Mortgages.
Section 4.2. Release of Mortgaged Property - Consent of Noteholders.
In addition to the sale and release of any Mortgaged Property pursuant to
Section 3.2 or 3.3 of the related Mortgage, the Company may sell or otherwise
dispose of any Mortgaged Property then subject to the lien of this Indenture or
any indenture supplemental hereto and the related Mortgage, and the Trustees
shall release the same from the lien hereof or thereof to the extent and on the
terms and upon compliance with the conditions provided for in any written
consent given thereto at any time or from time to time by the holder or holders
of all of the then outstanding Notes.
SECTION 5. PREPAYMENT OF NOTES.
Section 5.1. Prepayments and Manner Thereof. Except to the extent
provided for in this Section 5, the Notes shall not be subject to prepayment or
redemption in whole or in part at the option of the Company prior to the
expressed maturity dates thereof. Every prepayment of the Notes shall be made
in accordance with the provisions of this Section 5.
Section 5.2. Optional Prepayment in the Event of Casualty or
Condemnation. The Notes may be prepaid at any time prior to maturity, either
in whole or in part, through the application of moneys received by the
Corporate Trustee pursuant to the provisions of Section 4.1 of any of the
Mortgages upon payment of the principal amount of the Notes so to be prepaid
and accrued interest thereon to the date of prepayment, together with a premium
equal to the Make Whole Amount. If the moneys received pursuant to the
provisions of Section 4.1 of any of the Mortgages are insufficient to pay the
remaining principal balance so to be prepaid then the Company shall pay any
additional amounts necessary, together with a premium equal to the Make Whole
Amount.
Section 5.3. Optional Prepayment upon Election to Withdraw. The Notes
may be prepaid at any time, either in whole or in part, through the application
of monies received by the Corporate Trustee pursuant to the provisions of
Section 3.3 of any of the Mortgages upon payment of the principal amount of the
Notes so to be prepaid and accrued interest
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thereon to the date of prepayment, together with a premium equal to the Make
Whole Amount.
Section 5.4. Optional Prepayment with Premium. In addition to the
rights of prepayment set forth in Sections 5.2 and 5.3, the Company shall have
the privilege, on any date on which regularly scheduled payments of principal
and interest are due on or in respect of the Notes of prepaying the Notes,
either in whole or in part (but if in part in units of U.S. $1,000,000 or an
integral multiple of U.S. $100,000 in excess thereof), by payment of the
principal amount of the Notes or a portion thereof to be prepaid, and accrued
interest thereon to the date of prepayment, together with a premium equal to
the Make Whole Amount.
Section 5.5. Prepayment of Notes upon a Designated Event. (a) In the
event that a Designated Event shall occur or the Company shall have knowledge
of any proposed Designated Event, the Company will give written notice (the
"Company Notice") of such fact to all of the holders of the Notes and the
Trustees. The Company Notice shall be delivered promptly upon receipt of such
knowledge by the Company and in any event not later than three days following
the occurrence of a Designated Event. The Company Notice shall (1) describe
the facts and circumstances of such Designated Event in reasonable detail, (2)
make reference to this Section 5.5 and the right of the holders of the Notes to
require prepayment on the terms and conditions provided for in this Section
5.5, (3) offer in writing to prepay the outstanding Notes, together with
accrued interest thereon to the date of prepayment and a premium equal to the
then applicable Make Whole Amount, and (4) specify a date for such prepayment
(the "Designated Event Prepayment Date") which Designated Event Prepayment Date
shall be not more than 40 days nor less than 20 days following the date of such
Company Notice. Each holder of the outstanding Notes shall have the right to
accept such offer and require prepayment of the Notes held by such holder, by
written notice to the Company (a "Noteholder Notice") given to the Company not
later than 15 days after the date of the Company Notice. The Company shall on
the Designated Event Prepayment Date prepay all Notes held by holders which
have so accepted such offer of prepayment. The prepayment price of the Notes
payable upon the occurrence of any Designated Event shall be an amount equal to
100% of the principal amount of the Notes so to be prepaid together with
accrued interest thereon to the date of prepayment and a premium equal to the
then applicable Make Whole Amount.
(b) Without limiting the foregoing, notwithstanding any failure on
the part of the Company to give the Company Notice herein required as the
result of the occurrence of a Designated Event, each holder of the Notes shall
have the right by delivery of written notice to the Company (with a copy of
such written notice to the Trustees) to require the Company to prepay, and the
Company will prepay, such holder's outstanding Notes in full, together with
accrued interest thereon to the date of prepayment and a premium equal to the
then applicable Make Whole Amount at any time after such holder has actual
knowledge of any such Designated Event. Notice of any required prepayment
pursuant to this Section 5.5(b) shall be delivered to the Company and the
Trustees by the holder of the Notes which was entitled to, but did not receive,
such Company Notice after such holder has actual knowledge of such Designated
Event. On the date (the "Designated Event Delayed
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Prepayment Date") designated in such holder's notice (which shall not be
earlier than 20 days after the date of such holder's notice), the Company shall
prepay in full such holder's outstanding Notes, together with accrued interest
thereon to the date of prepayment and a premium equal to the the applicable
Make Whole Amount. If the holder of any Note gives notice pursuant to this
Section 5.5(b), the Company shall give a Company Notice within three days of
receipt of such notice and identify the Designated Event Delayed Prepayment
Date to all holders of the Notes and each of such holders shall then and
thereupon have the right to accept the Company's offer to prepay the Notes held
by such holder and require prepayment of such Notes by delivery of a Noteholder
Notice within ten days following receipt of such Company Notice; provided only
that any date for prepayment of such holders Notes shall be the Designated
Event Delayed Prepayment Date.
(c) A "Designated Event" shall have occurred if:
(1) (i) a "Person" or "Group" of Persons (within the
meaning of Sections 13(d) and 14(d)(2) of the Exchange Act), shall
directly or indirectly become Beneficial Owner of more than 50% of (y)
the total voting power of the Voting Stock of the Company then
outstanding, or (z) of the assets of the Company and its Subsidiaries;
or
(ii) the Company shall have consolidated with or merged
into any other corporation and the corporation resulting from such
consolidation or merger (the "surviving corporation") shall not be
the Company; or
(iii) the Company directly or indirectly or through its
Subsidiaries purchases or otherwise acquires directly or indirectly,
Beneficial Ownership of outstanding Voting Stock of the Company for
cash, Property, Securities or other assets (other than solely in
exchange for or upon conversion of Voting Stock of the Company) and
the sum of the percentages of (y) the aggregate total voting power of
the Voting Stock purchased or acquired in connection with such
purchase or acquisition of Voting Stock of the Company (expressed as a
percentage of the total voting power of the Voting Stock of the
Company outstanding one day before the date of such purchase or
acquisition) and (z) the aggregate voting power of the Voting Stock
purchased or acquired in connection with all other such purchases or
acquisitions of such Voting Stock (in each case expressed as a
percentage of the total voting power of the Voting Stock of the
Company outstanding one day before the date of such purchase or
acquisition) effected within the twelve month period ending on the
date on which the purchase or acquisition referred to in (y) is
effected exceeds 50%; or
(iv) the Company, directly or indirectly, distributes
cash, Property, Securities (other than Voting Stock of the Company) or
other assets in respect of its Voting Stock and the aggregate fair
market value of all cash, property, Securities (other than Voting
Stock of the Company) or other assets distributed in connection with
(y) such distributions and (z) all other such distributions made
during the twelve month period ending on the date on which the
distribution described in (i) is effected exceeds 50% of the aggregate
Fair Market Value of all outstanding Voting Stock of the Company
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determined as of the date immediately prior to the beginning
of such twelve month period;
and
(2) after giving effect to the occurrence of any event
described in clauses (i), (ii), (iii) or (iv) of this Section 5.5(c),
either (x) a Default or Event of Default exists or (z) the Company or
the surviving corporation for any reason is not rated Investment Grade
by ▇▇▇▇▇'▇ or S&P.
(d) For purposes of this Section 5.5, the following terms shall have
the following meanings:
(i) "Beneficial Ownership" as to any Voting Stock shall be
determined pursuant to Rule 13(d)-3 or 13(d)-5 promulgated under the
Exchange Act.
(ii) "Fair Market Value" shall mean with respect to the Voting
Stock of the Company as of any date, the arithmetic average of the
closing prices per share for such Voting Stock for the 20 most recent
trading days on the principal stock exchange on which such shares are
listed or, if such shares are not so listed, the arithmetic average of
the closing or last sales price per share for such Voting Stock for
the 20 most recent trading days on the automated quotron system in
which such shares are quoted or, if such shares are not so quoted or
listed, the fair market value thereof as determined in good faith by
the Board of Directors of the Company.
Section 5.6. Optional Prepayment of Notes upon Determination to Remain
Dark. The Notes may be prepaid at any time, either in whole or in part,
pursuant to the provisions of Section 3.8(b) hereof upon payment of the
principal amount of the Notes so to be prepaid and accrued interest thereon to
the date of prepayment, together with a premium equal to the Make Whole Amount.
Section 5.7. Notice of Prepayments. The Company will give written
notice of any prepayment of the Notes to each holder thereof (with a copy to
the Trustees) not less than 30 days nor more than 60 days before the date fixed
for such prepayment specifying (a) such date, (b) the section of this Indenture
and/or the related Mortgage under which the prepayment is to be made, (c) the
principal amount of the holder's Notes to be prepaid on such date, and (d) the
estimated premium, if any, and accrued interest applicable to the prepayment.
Such notice of prepayment shall also certify all facts which are conditions
precedent to any such prepayment. Notice of prepayment having been so given,
the aggregate principal amount of the Notes specified in such notice, together
with premium, if any, and accrued interest thereon shall become due and payable
on the prepayment date. Not later than two Business Days prior to the
prepayment date specified in such notice, the Company shall provide each holder
of a Note written notice of the premium, if any, payable in connection with
such prepayment and, whether or not any premium is payable, a reasonably
detailed computation of the Make Whole Amount.
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Section 5.8. Allocation of Prepayments. The aggregate principal
amount of each required or optional partial prepayment of the Notes shall be
allocated in units of U.S. $1,000 or multiples thereof among the holders of the
Notes at the time outstanding in proportion, as nearly as practicable, to the
respective unpaid principal amounts of the Notes to be prepaid then
outstanding, with adjustments, to the extent practicable, to equalize for any
prior prepayments not in such proportion. Partial prepayments, other than
partial prepayments pursuant to Section 5.5, shall be applied on all
outstanding Notes ratably in accordance with the unpaid principal amounts
thereof. Partial prepayments made pursuant to Section 5.4 shall be credited in
each case first, against the final maturities of the Notes being prepaid and
then, against the installments on such Notes in the inverse order of the
maturities thereof.
SECTION 6. REMEDIES OF THE TRUSTEES AND THE NOTEHOLDERS.
Section 6.1. Definition of Event of Default. The following events
are hereby defined for all purposes of this Indenture as "Events of Default":
(a) Default in the payment of interest on any Note when the
same shall become due and such default shall continue for more than
five days; or
(b) Default shall occur in the making of any payment of
the principal of any Note or premium, if any, thereon at the expressed
or any accelerated maturity date or at any date fixed for prepayment
or payment; or
(c) For any reason whatsoever the Company is not rated at
least Investment Grade by ▇▇▇▇▇'▇ and S&P; or
(d) Default shall occur in the observance or performance
of any other covenants or provisions of this Indenture (other than
Section 3.14 hereof, provision for which is made in Section 6.1(c)
hereof) which is not remedied within 30 days after the day on which a
Responsible Officer of the Company first obtains knowledge of such
Default; or
(e) An Event of Default shall occur and be continuing under
any of the Mortgages; or
(f) If any representation or warranty made by the Company
herein or in any Mortgage or in the Note Agreements, or made by the
Company in any statement or certificate furnished by the Company in
connection with the consummation of the issuance and sale of the Notes
or furnished by the Company pursuant to this Indenture, any Mortgage
or the Note Agreements, proves untrue in any material respect as of
the date of the issuance or making thereof; or
(g) A custodian, liquidator, trustee or receiver is
appointed for the Company or for the major part of its property and is
not discharged within 60 days after such appointment; or
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(h) The Company becomes insolvent or bankrupt, is
generally not paying its debts as they become due or makes an
assignment for the benefit of creditors, or the Company applies for or
consents to the appointment of a custodian, liquidator, trustee or
receiver for the Company or for the major part of its property; or
(i) Bankruptcy, reorganization, arrangement or insolvency
proceedings, or other proceedings for relief under any bankruptcy or
similar law or laws for the relief of debtors, are instituted by or
against the Company and, if instituted against the Company, are
consented to or are not dismissed within 60 days after such
institution.
When any Event of Default described in subparagraph (a) or (b) of this
Section 6.1 has occurred and is continuing, the Trustees at the direction of
any holder of the Notes shall or any holder of any Note may, by notice in
writing sent in the manner provided in Section 11.5 hereof to the Company (and
to the Trustees, if such notice is delivered by a holder or the holders of the
Notes), declare the entire principal and all interest accrued on such Note to
be, and such Note shall thereupon become, forthwith due and payable, without
any presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived. When any Event of Default described in subparagraphs
(a) through (f), inclusive of this Section 6.1 has happened and is continuing,
the Trustees at the direction of the holder or holders of 35% or more of the
principal amount of the Notes at the time outstanding or the holder or holders
of 35% or more of the principal amount of Notes at the time outstanding may, by
notice in writing sent in the manner provided in Section 11.5 hereof to the
Company (and to the Trustees if such notice is delivered by a holder or the
holders of the Notes), declare the entire principal and all interest accrued on
all Notes to be, and all Notes shall thereupon become, forthwith due and
payable, without any presentment, demand, protest or other notice of any kind,
all of which are hereby expressly waived. When any Event of Default described
in subparagraph (g), (h) or (i) of this Section 6.1 has occurred, then all
outstanding Notes shall immediately become due and payable without presentment,
demand or notice of any kind. Upon the Notes becoming due and payable as a
result of any Event of Default as aforesaid, the Company will forthwith pay to
the Trustees for the benefit of the holders of the Notes then outstanding the
entire principal and interest accrued on the Notes and, to the extent not
prohibited by applicable law an amount as liquidated damages for the loss of
the bargain evidenced hereby (and not as a penalty) equal to the Make Whole
Amount. The Company further agrees, to the extent permitted by law, to pay to
the Trustees and the holders of the Notes all costs and expenses incurred by
them in the collection of any Notes upon any default hereunder or thereon,
including reasonable compensation to such Trustees' and to such holders'
attorneys for all services rendered in connection therewith, whether or not a
lawsuit is filed in connection therewith.
In case the Company shall fail to pay the same forthwith, the
Trustees, in their own names and as trustees of an express trust, shall be
entitled to recover judgment for the whole amount so due and unpaid against the
Company and/or any other obligor on the Notes. The right of the Trustees to
recover such judgment shall not be affected by the exercise of any other right,
power or remedy for the enforcement of the provisions of this Indenture.
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THE COMPANY ACKNOWLEDGES THAT THE PURCHASERS WOULD NOT PURCHASE THE
NOTES WITHOUT THE COMPANY'S AGREEMENT, AS SET FORTH ABOVE IN THIS SECTION 6.1,
TO PAY THE PURCHASERS OR ANY OTHER HOLDERS OF THE NOTES A PREPAYMENT PREMIUM
UPON THE SATISFACTION OF ALL OR ANY PORTION OF THE PRINCIPAL INDEBTEDNESS
EVIDENCED BY THE NOTES FOLLOWING THE ACCELERATION OF THE MATURITY DATE BY
REASON OF AN EVENT OF DEFAULT OCCURRING AND CONTINUING HEREUNDER, AND THE
COMPANY HAS CAUSED THE PERSON SIGNING THIS INDENTURE ON THE COMPANY'S BEHALF
SEPARATELY TO INITIAL THE AGREEMENT CONTAINED IN THIS SECTION 6.1, IN
COMPLIANCE WITH SECTION 2954.10 OF THE CALIFORNIA CIVIL CODE, BY PLACING HIS
INITIALS BELOW:
INITIALS: /s/ JPC
------------
Section 6.2. Suits for Endorsement; Power of Sale. In case of the
happening of an Event of Default as defined in Section 6.1 and during the
continuance thereof, the Trustees from time to time in their discretion may,
but subject always to the written direction of the holders of at least 51% of
the outstanding principal amount of the Notes, exercise, in addition to all
other rights and powers described herein or permitted under applicable law, all
or any of the following powers as they may deem best for the protection and
enforcement of the interests and rights of the Trustees and of the holders of
the Notes then outstanding:
(a) the Trustees may, in their own name and as trustees of
an express trust, protect and enforce their rights and the rights of
the holders of the Notes by bringing such actions, at law or in equity
or before any administrative tribunal, as the Trustees, being advised
by counsel, shall deem appropriate, including, without limitation,
actions for the specific performance of any covenant hereof, or of the
Notes, and for the foreclosure of one or all of the Mortgages; and the
Trustees shall be entitled, in their own names and as trustees of an
express trust, to recover judgment for any and all sums then, or
during any Default becoming due and payable by the Company under any
provisions hereof or of the Notes or any of the Mortgages, including,
without limitation, any deficiency in the payment of all amounts due
under the provisions hereof or of the Notes or any of the Mortgages
remaining after any sale of the Mortgaged Properties in foreclosure
proceedings or by virtue of the Trustees' power of sale or otherwise,
and, in addition thereto, such amounts as shall be sufficient to cover
the costs and expenses of collection, including attorneys' fees, and
of other proceedings hereunder, and to collect out of the Trust Estate
in any manner provided by law all amounts adjudged or decreed to be
payable;
(b) the Trustees as a matter of contract right and not as
a penalty shall be entitled to the appointment of a receiver of, or
may enter upon and take possession of, all or any part of the
Mortgaged Properties and such receiver or the Trustees shall thereupon
be entitled to operate all or any part of the Mortgaged Properties and
to make all expenditures and to take all actions necessary or
desirable therefor, and to collect and retain all income and earnings
arising from the Trust Estate;
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(c) the Trustees may, with or without entry as aforesaid,
sell all or any part of the Mortgaged Properties at public or private
sale, upon such notice, in such manner, at such time or times, and
upon such terms consistent with the applicable laws of the respective
States wherein such Mortgaged Properties are located, as the Trustees
may determine;
(d) the Trustees may exercise any remedies and take any
other appropriate action to protect and enforce the rights and
remedies of the Trustees or the holders of the Notes under the
Mortgages; and
(e) the Trustees shall have any and all rights and remedies
provided to a secured party by the Uniform Commercial Code with
respect to all parts of the Mortgaged Properties which are or which
are deemed to be governed by the Uniform Commercial Code.
The Company, to the extent permitted by law, shall not claim any
rights under any stay, valuation, exemption or extension law, and hereby waives
any right of redemption which it may have in respect of the Mortgaged
Properties.
Section 6.3. Foreclosure and Sale of Mortgaged Property. In the event
of any sale made under or by virtue of this Indenture or any of the Mortgages,
whether made under the power of sale herein granted or under or by virtue of
judicial proceedings or decree of foreclosure and sale, the whole of the
Mortgaged Properties may be sold in one parcel and as an entirety, or in
separate parcels or lots, as the Trustees may reasonably determine, or as they
may be directed by the written direction of the holders of not less than a
majority in principal amount of the Notes then outstanding.
Section 6.4. Adjournment of Sale. The Trustees may adjourn from time
to time any sale by them to be made under the provisions of this Indenture or
any of the Mortgages, by announcement at the time and place appointed for such
sale or for such adjourned sale or sales; and, except as otherwise provided by
law, the Trustees, without further notice or publication, may make such sale at
the time and place to which the same shall be so adjourned.
Section 6.5. Trustees May Execute Conveyances and Deliver Possession;
Sale a Bar. Upon the completion of any foreclosure sale or sales made under or
by virtue of this Indenture or any of the Mortgages and in accordance with
applicable law, the Trustees shall execute and deliver to the accepted
purchaser or purchasers a good and sufficient deed, or good and sufficient
deeds, and other instruments conveying, assigning and transferring all their
estate, right, title and interest in and to the Mortgaged Properties,
privileges and rights so sold. The Trustees are hereby irrevocably appointed
the true and lawful attorneys-in-fact of the Company, in its name, place and
stead or in the name of the Trustees, to make all such necessary conveyances,
assignments, transfers and deliveries of the premises and the Mortgaged
Properties, privileges and rights so sold and for that purpose the Trustees may
execute all necessary deeds and instruments of assignment and transfer, and may
substitute one or more Persons with like power, the Company hereby ratifying
and confirming all that
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its said attorneys or such substitute or substitutes shall lawfully do by
virtue hereof. Nevertheless, the Company, if so requested in writing by the
Trustees, shall ratify and confirm any such sale or sales by executing and
delivering to the Trustees or to such purchaser or purchasers all such
instruments as may be advisable, in the judgment of the Trustees, for the
purpose and as may be designated in such request.
Any such sale or sales made under or by virtue of this Indenture or
any of the Mortgages, whether made under the power of sale herein granted or
under or by virtue of judicial proceedings or of a judgment or decree of
foreclosure and sale, shall operate to divest all estate, right, title,
interest, claim or demand whatsoever, whether at law or in equity, of the
Company, in and to the Mortgaged Properties, privileges and rights so sold, and
shall be a perpetual bar both at law and in equity against the Company, its
successors and assigns, and against any and all Persons claiming or who may
claim the same, or any part thereof from, through or under the Company, its
successors or assigns.
Section 6.6. Receipt Sufficient Discharge for Purchaser. The receipt
of the Trustees or of the court officer conducting any such sale for the
purchase money paid at any such sale shall be a sufficient discharge therefor
to any purchaser of the Mortgaged Properties, or any part thereof, sold as
aforesaid; and no such purchaser or his representatives, grantees or assigns,
after paying such purchase money and receiving such receipt, shall be bound to
see the application of such purchase money upon or for any trust or purpose of
this Indenture, or shall be answerable in any manner whatsoever for any loss,
misapplication or nonapplication of any such purchase money or any part
thereof, nor shall any such purchaser be bound to inquire as to the necessity
or expediency of any such sale.
Section 6.7. Sale to Accelerate Notes. In the event of any sale made
under or by virtue of this Indenture or any of the Mortgages, whether made
under the power of sale herein granted or under or by virtue of judicial
proceedings or of a valid judgment or decree of foreclosure and sale, the
entire principal amount of the Notes, together with accrued and unpaid interest
thereon and the Make Whole Amount, if any, if not previously due, immediately
thereupon shall become due and payable, anything in the Notes or in this
Indenture to the contrary notwithstanding.
Section 6.8. Application of Proceeds of Sale. The purchase money
proceeds or avails of any such sale, together with any other sums which then
may be held by the Trustees under this Indenture as part of the Trust Estate or
the proceeds thereof, whether under the provisions of this Section 6 or
otherwise, shall be applied as follows:
First: To the payment of the costs and expenses of
foreclosure or suit, if any, and of such sale, and to the extent
permitted by applicable law, the reasonable compensation of the
Trustees, their agents, attorneys and counsel, and of all proper
expenses, liability and advances incurred or made hereunder by the
Trustees;
Second: To the payment of the amount then owing or unpaid on
the Notes for principal, premium, if any, and interest; and in case
such proceeds shall be insufficient to pay in full the whole amount so
due, owing or unpaid upon the Notes, then ratably
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according to the aggregate of such principal and the accrued and
unpaid interest and premium, if any, with application on each Note to
be made, first, to the unpaid premium, if any, thereon, second, to
unpaid interest, thereon, and third, to unpaid principal thereof;
Third: To the payment of any other sums required to be paid
by the Company pursuant to any provision of this Indenture, the Note
Agreements, any of the Mortgages, the Notes or any other instrument
given to secure the Notes; and
Fourth: To the payment of the surplus, if any, to the
Company, its successors or assigns, upon the written request of the
Company or to whomsoever may be lawfully entitled to receive the same.
Section 6.9. Purchase of Mortgaged Properties. Upon any sale made
under or by virtue of this Indenture or any of the Mortgages, whether made
under the power of sale herein granted or under or by virtue of judicial
proceedings or of a judgment or decree of foreclosure and sale, the Trustees
may bid for and purchase the Mortgaged Properties being sold, and upon
compliance with the terms of sale, may hold, retain and possess and dispose of
such Mortgaged Properties in its own absolute right without further
accountability; and any purchaser at any such sale may, in paying the purchase
price, turn in any of the Notes in lieu of cash to the amount which shall, upon
distribution of the net proceeds of such sale, be payable thereon. Said Notes,
in case the amounts so payable thereon shall be less than the amount due
thereon, shall be returned to the holders thereof after a notation of such
partial payment shall have been made thereon.
Section 6.10. Trustees Entitled to Appointment of Receiver. The
Company further covenants that upon the happening of any Event of Default and
thereafter during the continuance of such Event of Default unless the same
shall have been waived as hereinafter provided, the Trustees shall be entitled,
as a matter of right, if they shall so elect, (a) forthwith and without
declaring the principal of the Notes to be due and payable, or (b) after
declaring the same to be due and payable, or (c) upon the filing of a ▇▇▇▇ in
equity to foreclose this Indenture or to enforce the specific performance
hereof or in aid thereof or upon the commencement of any other judicial
proceeding to enforce any right of the Trustees or of the holders of the Notes,
to the appointment of a receiver or receivers of the Mortgaged Properties and
of all the earnings, revenues, rents, issues, profits and income thereof, with
such powers as the court making such appointment shall confer, which may
comprise any or all of the powers which the Trustees are authorized to exercise
by the provisions of Section 6.2. The Company, if requested so to do by the
Trustees, will consent to the appointment of any such receiver as aforesaid.
Section 6.11. Trustees May Enforce Rights without Notes. All rights
of action under this Indenture or under any of the Mortgages or Notes may be
enforced by the Trustees without the possession of any of the Notes and without
the production thereof at any trial or other proceedings relative thereto. Any
such suit or proceedings instituted by the Trustees shall be brought in their
own names or as Trustees, and any recovery of judgment shall be,
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subject to the rights of the Trustees, for the ratable benefit of the holders
of the Notes outstanding.
Section 6.12. Notice of Event of Default; Waiver. The Corporate
Trustee shall promptly (and in no event more than two Business Days) after
obtaining actual knowledge of any Event of Default give notice thereof to the
holders of all Notes at the time outstanding. The holders of at least 66 2/3%
in principal amount of the Notes at the time outstanding hereunder may waive
any Event of Default hereunder and its consequences which result from the
failure of the Company to comply with any provisions of this Indenture,
compliance with which can be waived by such holders pursuant to Section 8.1 and
rescind or annul any declaration of maturity made pursuant to Section 6.1
hereof; provided, that at the time such declaration is rescinded or annulled:
(a) no judgment or decree has been entered for the payment of
any moneys due pursuant to the Notes, this Indenture or any of the
Mortgages;
(b) all arrears of interest upon and principal payable in
respect of all of the Notes and all other sums payable under the
Notes, this Indenture and the Mortgages (except any principal,
interest or premium on the Notes which has become due and payable
solely by reason of such declaration under Section 6.1 hereof) shall
have been duly paid; and
(c) each and every other Default and Event of Default shall
have been made good, cured or waived pursuant to Section 8.1 hereof.
In case of any such waiver, or in case any proceedings taken on account of any
such Default or Event of Default shall be discontinued or abandoned or
determined adversely to the Trustees, then and in every such case, the Company,
the Trustees and the holders of the Notes shall be restored to their former
positions and rights hereunder respectively. No such waiver shall extend to
any subsequent or other Event of Default or impair any right consequent
thereon.
Section 6.13. Limitation on Noteholders' Right to ▇▇▇. No holder of
any Note shall have any right to institute any suit, action or proceeding at
law or in equity growing out of any provision of this Indenture or any of the
Mortgages, or for the foreclosure or enforcement of this Indenture or any of
the Mortgages, unless and until an Event of Default shall have happened and
unless and until such holder shall have previously given to the Corporate
Trustee written notice of the happening of such Event of Default and of the
continuance thereof as hereinbefore provided, and also (except as hereinafter
provided) unless and until the holders of at least 35% in principal amount of
the Notes then outstanding shall have made written request upon the Trustees
and shall have afforded to them a reasonable opportunity to institute such
action, suit or proceeding in their own names unless also the Trustees in
conjunction with any such written request shall have been offered by such
holders indemnity reasonably satisfactory to them against the costs, expenses
and liabilities to be incurred as a result of the Trustees instituting such
action, suit or proceeding, and the Trustees shall have neglected or refused to
so institute such action, suit or
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proceeding within a reasonable time after receipt of such notification, request
and offer of indemnity; and such notification, request, offer of indemnity and
refusal or neglect are hereby declared in every such case to be conditions
precedent to the institution by such holder of the Notes of any such action,
suit or proceeding; it being understood and intended and being expressly
covenanted by the holder of every Note with every other holder and with the
Trustees that no one or more holders of the Notes shall be entitled to take any
action or institute any such suit to enforce the payment of its Notes if and to
the extent that the taking of such action or the institution or prosecution of
any such suit or the entry of judgment therein would under applicable law
result in a surrender, impairment, waiver or loss of the lien of this Indenture
or any of the Mortgages upon the Mortgaged Properties, or any part thereof, as
security for Notes held by any other holder of the Notes, or shall have any
right in any manner whatever to affect, disturb or prejudice the rights of the
holders of any other of the Notes, or to enforce any right hereunder, except in
the manner herein provided, and for the equal, ratable and common benefit of
all holders of the Notes. Nothing in this Section 6.13 or elsewhere in this
Indenture or in the Notes contained, however, shall affect or impair the
obligation of the Company, which is unconditional and absolute, to pay the
principal of, premium, if any, and interest on, the Notes to the respective
holders of the Notes, in the manner and at the time and places therein
respectively expressed, nor shall it affect or impair the right of the
respective holders of the Notes, by an action at law upon the promises to pay
therein contained, to enforce such payment.
Section 6.14. Remedies Cumulative. No remedy herein conferred upon or
reserved to the Trustees or to the holders of the Notes is intended to be
exclusive of any other remedy or remedies, and each and every such remedy shall
be cumulative, and shall be in addition to every other remedy given hereunder
or now or hereafter existing at law or in equity or by statute.
Section 6.15. Delay or Omission Not a Waiver. No delay or omission of the
Trustees, or of any holder of the Notes, to exercise any right or power
accruing upon any Default or Event of Default, shall impair any such right or
power, or shall be construed to be a waiver of any such Default or Event of
Default or an acquiescence therein; and every power and remedy given by this
Indenture or any of the Mortgages to the Trustees or to the holders of the
Notes may be exercised from time to time and as often as may be deemed
expedient by the Trustees or by the holders of the Notes.
Section 6.16. Waiver of Extension, Appraisement, Stay, Laws. The Company
will not at any time insist upon, or plead, or in any manner whatever claim or
take any benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants and terms
of performance of this Indenture or any of the Mortgages; nor claim, take or
insist upon any benefit or advantage of any law now or hereafter in force
providing for the valuation or appraisement of the Mortgaged Properties, or any
part thereof, prior to any sale or sales thereof which may be made pursuant to
any provision herein contained, or pursuant to the decree, judgment or order of
any court of competent jurisdiction; nor after any such sale or sales, claim or
exercise any right under any statute heretofore or hereafter enacted by the
United States of America or by any state or territory, or otherwise, to redeem
any of the Mortgaged Properties so sold or any part
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thereof, and the Company hereby expressly waives all benefits or advantage of
any such law or laws, and covenants not to hinder, delay or impede the
execution of any power herein granted or delegated to the Trustees, but to
suffer and permit the execution of every power as though no such law or laws
had been made or enacted.
Section 6.17. Restoration of Positions. If the Trustees or any holder of
the Notes has instituted any proceeding to enforce any right or remedy under
this Indenture or any of the Mortgages by foreclosure, entry or otherwise and
such proceeding has been discontinued or abandoned for any reason or has been
determined adversely to the Trustees or to such holder of the Notes, then and
in every such case the Company, the Trustees and the holders of the Notes
shall, subject to any determination in such proceeding, be restored to their
former positions hereunder, and thereafter all rights and remedies of the
Trustees and the holders of the Notes shall continue as though no such
proceeding had been instituted.
Section 6.18. Control of Remedies by Noteholders. Notwithstanding any
other provision of this Section 6, the holders of at least 51% in principal
amount of the Notes from time to time outstanding shall have the right, by an
instrument in writing delivered to the Trustees, to determine which of the
remedies herein set forth shall be adopted and to direct the time, method and
place of conducting all proceedings to be taken under the provisions of this
Indenture or any of the Mortgages for the enforcement thereof or of the Notes;
provided, however, that the Trustees shall have the right to decline to follow
any such direction if the Trustees shall be advised by an Opinion of Counsel
that the action or proceeding so directed may not lawfully be taken or would be
unjustly prejudicial to holders of Notes not parties to such direction.
Section 6.19. Trustees May File Proofs of Claims. The Trustees are hereby
appointed, and each and every holder of the Notes, by receiving and holding the
same, shall be conclusively deemed to have appointed the Trustees the true and
lawful attorneys-in-fact of such holder, with authority to make or file, in
their own names as trustees of an express trust or otherwise as they shall deem
advisable, in any receivership, insolvency, liquidation, bankruptcy,
arrangement, reorganization or other judicial proceedings relative to the
Company or any other obligor upon the Notes or to their respective creditors or
Property, any and all claims, proofs of debt, petitions, consents, other
documents and amendments of any thereof, as may be necessary or advisable in
order to have the claims of the Trustees and of the holders of the Notes
allowed in any such proceeding, and to collect and receive any moneys or other
Property payable or deliverable on any such claim, proof of debt, petition or
other document and to distribute the same after the deduction of the charges
and expenses of the Trustees, and to execute and deliver any and all other
papers and documents and to do and perform any and all other acts and things,
as they may deem necessary or advisable in order to enforce in any such
proceedings any of the claims of the Trustees and of any such holders in
respect of any of the Notes; and any receiver, assignee, trustee or debtor in
any such proceedings is hereby authorized, and each and every holder of the
Notes, by receiving and holding the same, shall be deemed to have authorized
any such receiver, assignee, trustee or debtor, to make any such payment or
delivery to or on the order of the Trustees, and in the event that the Trustees
shall consent to the making of such payments or deliveries directly to the
holders of the Notes to pay to the Trustees any amount due them for
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compensation and expenses, including counsel fees, incurred by them down to the
date of such payment or delivery; provided, however, that nothing herein
contained shall be deemed to authorize or empower the Trustees to consent to or
accept or adopt, on behalf of any holder of Notes, any plan of reorganization
or readjustment of the Company affecting the Notes or the rights of any holder
thereof, or to authorize or empower the Trustees to vote in respect of the
claim of any holder of any Note in any such proceedings.
Section 6.20. Remedies Subject to Provisions of Law. All rights, remedies
and powers provided by this Section 6 may be exercised only to the extent that
the exercise thereof does not violate any applicable provision of law in the
premises, and all the provisions of this Section 6 are intended to be subject
to all applicable mandatory provisions of law which may be controlling in the
premises and to be limited to the extent necessary so that they will not render
this Indenture invalid or unenforceable under the provisions of any applicable
law.
SECTION 7. CONCERNING THE TRUSTEES.
The Trustees accept the trusts hereunder and agree to perform the same and
all other actions to be taken by the Trustees under the Mortgages, but only
upon the terms and conditions hereof, including the following, to all of which
the Company and the respective holders of the Notes at any time outstanding by
their acceptance thereof agree:
Section 7.1. Duties of Trustees. The Trustees undertake (a) except
while an Event of Default actually known to the Trustees shall have occurred
and be continuing, to perform such duties and only such duties as are
specifically set forth in this Indenture, and (b) while an Event of Default
actually known to the Trustees shall have occurred and be continuing, to
exercise such of the rights and powers as are vested in them by this Indenture,
and to use the same degree of care and skill in their exercise as a prudent
person would exercise or use under the circumstances in the conduct of his own
affairs.
The Trustees upon receipt of instruments furnished to the Trustees
pursuant to the provisions of this Indenture, shall examine the same to
determine whether or not such instruments appear to conform to the requirements
of this Indenture.
Section 7.2. Trustees' Liability. No provision of this Indenture shall be
construed to relieve the Trustees from liability for their own negligent
action, negligent failure to act, or their own willful misconduct, except that:
(a) unless an Event of Default shall have occurred and be
continuing, the Trustees shall not be liable except for the performance of
such duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the
Trustees but the duties and obligations of the Trustees shall be
determined solely by the express provisions of this Indenture;
(b) in the absence of bad faith on the part of the Trustees, the
Trustees may rely upon the authenticity of, and the truth of the
statements and the correctness of the
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opinions expressed in, and shall be protected in acting upon, any
resolution, Officers' Certificate, Opinion of Counsel, Note, request,
notice, consent, waiver, order, signature guaranty, notarial seal, stamp,
acknowledgment, verification, appraisal, report, stock certificate, or
other paper or document believed by the Trustees to be genuine and to have
been signed, affixed or presented by the proper party or parties;
(c) in the absence of bad faith on the part of the Trustees,
whenever the Trustees, or any of their agents, representatives, experts or
counsel, shall consider it necessary or desirable that any matter be
proved or established, such matter (unless other evidence in respect
thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by an Officers' Certificate; provided,
however, that the Trustees, or such agent, respectively, expert or
counsel, may require such further and additional evidence and make such
further investigation as it or they may consider reasonable;
(d) the Trustees may consult with counsel and the advice or opinion
of such counsel shall be full and complete authorization and protection in
respect of any action taken or suffered hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(e) the Trustees shall not be liable with respect to any action
taken or omitted to be taken by them in good faith in accordance with any
direction or request of a holder or holders of the Notes with which the
Trustees are required by the provisions hereof to comply;
(f) the Trustees shall not be liable for any error of judgment made
in good faith by an officer of the Corporate Trustee unless it shall be
proved that the Corporate Trustee was negligent in ascertaining the
pertinent facts;
(g) the Trustees shall not be deemed to have knowledge of any
Default or Event of Default unless and until they shall have actual
knowledge thereof or have received written advice thereof from the holder
of any Note;
(h) whether or not an Event of Default shall have occurred, the
Trustees shall not be under any obligation to take any action under this
Indenture (including action under Section 6.18 hereof) which may tend to
involve them in any expense or liability, the payment of which within a
reasonable time is not, in their reasonable opinion, assured to them by
the security afforded to them by the terms of this Indenture, unless and
until requested in writing so to do by one or more holders of Notes
outstanding hereunder and furnished, from time to time as they may
require, with reasonable security and indemnity; and
(i) whether or not an Event of Default shall have occurred whenever
it is provided in this Indenture that the Trustees consent to any act or
omission by any Person or that the Trustees exercise their discretion in
any manner, the Trustees may (but need not) seek the written acquiescence
of the holders of at least 51% in principal
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amount of the Notes then outstanding and, unless written evidence of such
acquiescence has been received by the Trustees, they shall be fully
justified in refusing so to consent or so to exercise their discretion.
Section 7.3. No Responsibility of Trustees for Recitals. The recitals and
statements contained herein and in the Notes (except for the Corporate
Trustee's certificate of authentication endorsed on the Notes) shall be taken
as the recitals and statements of the Company, and the Trustees assume no
responsibility for the correctness of the same.
The Trustees make no representation as to the validity or sufficiency of
this Indenture or any of the Mortgages, or of the Notes secured hereby, the
security hereby or thereby afforded, the title of the Company to the Mortgaged
Properties or the descriptions thereof, or the filing or recording or
registering of this Indenture or any other document.
The Trustees shall not be concerned with or accountable to anyone for the
use or application of any deposited moneys which shall be released or withdrawn
in accordance with the provisions of this Indenture or of any Property or
Securities or the proceeds thereof which shall be released from the lien hereof
and any of the Mortgages in accordance with the provisions of this Indenture or
the Mortgages, as the case may be.
Section 7.4. Compensation and Expenses of Trustees; Indemnification; Lien
Therefor. The Company covenants to pay to the Trustees such compensation for
their services hereunder and under the Mortgages as shall be agreed to by the
Company and the Trustees, or, in the absence of such agreement, reasonable
compensation therefor (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust), and to pay, or
reimburse, the Trustees for all reasonable expenses incurred hereunder,
including the reasonable compensation, expenses and disbursements of such
agents, representatives, experts and counsel as the Trustees may employ in
connection with the exercise and performance of their powers and duties
hereunder.
The Company will also indemnify and save the Trustees, their agents,
employees and representatives, harmless against any expenses (including
reasonable attorneys' fees), liabilities and damages, not arising from their
own willful misconduct or negligence, which they or any of them may incur in
the exercise and performance of their rights, powers, trusts, duties and
obligations hereunder.
The Trustee shall have no right against the holder of any Note for the
payment of compensation for its services hereunder or any expenses or
disbursements incurred in connection with the exercise and performance of its
powers and duties hereunder or any indemnification against liabilities which it
may incur in the exercise and performance of such powers and duties but, on the
contrary, shall look solely to the Company for payment and indemnification and
it shall have no lien on the Trust Estate as security for such compensation,
expenses, disbursements and indemnification except to the extent provided in
Section 6.8 hereof.
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Section 7.5. Moneys Received by Trustees; Trust Funds - Segregation. All
moneys received by the Trustees under or pursuant to any provision of this
Indenture shall constitute trust funds for the purpose for which they were paid
or are held and shall be segregated from other moneys held by the Trustees
under such conditions as may be prescribed by applicable law for trust funds.
The Trustees shall not be responsible for the payment of interest on any
such moneys except as otherwise expressly provided herein.
Section 7.6. Action by Individual Trustee. The Individual Trustee shall
act as and be such upon the following terms and conditions:
(a) Subject to the provisions of Section 7.17, all rights, powers,
duties and obligations confer-red or imposed upon the Trustees shall be
conferred or imposed solely upon and solely exercised and performed by the
Corporate Trustee except as expressly provided otherwise in this Indenture
and except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed the Corporate Trustee shall
be incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations shall be exercised and
performed by the Individual Trustee.
(b) No power granted by this Indenture to, or which this Indenture
provides may be exercised by, the Individual Trustee shall be exercised by
the Individual Trustee except jointly with, or with the consent in writing
of, the Corporate Trustee, anything herein contained to the contrary
notwithstanding.
Section 7.7. Resignation of Corporate Trustee. The Corporate Trustee may
resign and be discharged from the trusts created hereby by delivering notice
thereof to the Company and all holders of the Notes at the time outstanding,
specifying a date (not earlier than 120 days after the date of such notice)
when such resignation shall take effect; provided that in no event shall any
such resignation be effective until a successor Corporate Trustee has been
appointed pursuant to Section 7.9 hereof.
Such resignation shall take effect on the day on which a qualified
successor Corporate Trustee shall have been appointed as provided in Section
7.9 and shall have accepted in writing its obligations hereunder.
Section 7.8. Removal of Corporate Trustee. The Corporate Trustee may be
removed at any time, for or without cause, by an instrument or instruments in
writing executed by the holders of at least 51% in aggregate principal amount
of the Notes at the time outstanding and delivered to the Corporate Trustee
with a copy to the Company, specifying the removal and the date when it shall
take effect.
Section 7.9. Appointment of Successor Corporate Trustee. in case at
any time the Corporate Trustee shall resign or be removed or become incapable
of acting, a successor Corporate Trustee may be appointed by the holders of at
least 51% in aggregate principal
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amount of the Notes at the time outstanding, by an instrument or instruments in
writing executed by such holders of the Notes and filed with such successor
Corporate Trustee with a copy of such instrument or instruments to the Company;
provided that if no Default or Event of Default shall have occurred and be
continuing at the time such holders of the Notes shall so appoint a successor
Corporate Trustee, the concurrence of the Company in the selection of such
successor Corporate Trustee shall be required.
Section 7.10. Succession of Successor Trustee. Any successor Corporate
Trustee appointed hereunder shall execute, acknowledge and deliver to the
Company and the predecessor Corporate Trustee an instrument accepting such
appointment, and thereupon such successor Corporate Trustee, without any
further act, deed, conveyance or transfer, shall become vested with the title
to the Trust Estate, and with all the rights, powers, trusts, duties and
obligations of the predecessor Corporate Trustee in the trust hereunder, with
like effect as if originally named as Corporate Trustee herein. Without
limiting the foregoing, such successor Corporate Trustee shall also execute,
acknowledge and deliver to the Company and the holders of the Notes such
further act, deed, conveyance or transfer as may reasonably be requested by any
holder of the Notes for more fully and certainly vesting and confirming to such
successor Corporate Trustee the title of the Trust Estate and all rights,
powers, trusts, duties and obligations of the predecessor Corporate Trustee.
Upon the request of any such successor Corporate Trustee, however, the
Company and the predecessor Corporate Trustee shall execute and deliver such
instruments of conveyance and further assurance and do such other things as may
reasonably be required for more fully and certainly vesting and confirming in
such successor Corporate Trustee the title to the Trust Estate and all such
rights, powers, trusts, duties and obligations of the predecessor Corporate
Trustee hereunder, and the predecessor Corporate Trustee shall also assign and
deliver to the successor Corporate Trustee any property subject to the lien of
this Indenture which may then be in its possession.
Section 7.11. Eligibility of Corporate Trustee. The Corporate Trustee
shall be a state or national bank or trust company in good standing, organized
under the laws of the United States of America or any state thereof and having
(or having a parent which has) a capital, surplus and undivided profits
aggregating at least Five Hundred Million and 00/100 (U.S.$500,000,000)
Dollars.
In case the Corporate Trustee shall cease to be eligible in accordance
with the provisions of this Section, the Corporate Trustee shall resign
immediately in the manner and with the effect specified in Section 7.7.
Section 7.12. Successor Trustee by Merger. Any corporation into which the
Corporate Trustee may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Corporate
Trustee shall be a party, or any state or national bank or trust company in any
manner succeeding to the corporate trust business of the Corporate Trustee as a
whole or substantially as a whole, if eligible as provided in Section 7.11,
shall be the successor of the Corporate Trustee hereunder without
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the execution or filing of any paper or any further act on the part of any of
the parties hereto, anything to the contrary contained herein notwithstanding.
Section 7.13. Resignation of Individual Trustee. The Individual Trustee
or any of his successors may resign and may be discharged of the trusts created
by this Indenture by giving written notice thereof to the Company and the
Corporate Trustee and all holders of the Notes at the time outstanding
specifying the date (not earlier than 120 days after the date of such notice)
when such resignation shall take effect; provided that in no event shall any
such resignation be effective until a successor Individual Trustee has been
appointed pursuant to Section 7.15 hereof.
Such resignation shall take effect on the day on which a qualified
successor Individual Trustee shall have been appointed as provided in Section
7.15 and shall have accepted in writing its obligations hereunder.
Section 7.14. Removal of Individual Trustee. The Individual Trustee or
any of his successors may be removed at any time, for or without cause, by the,
holders of at least 51% in aggregate principal amount of the Notes at the
time outstanding or by the Corporate Trustee, by delivery of a notice of such
removal to the Individual Trustee, to the Company, and in the case of removal
by such holders to the Corporate Trustee, signed by such holders or the
Corporate Trustee, as the case may be.
Section 7.15. Appointment of Successor to Individual Trustee. If at any
time the Individual Trustee or any of his successors shall die, resign or be
removed or otherwise become incapable of acting, or if for any reason the
office of Individual Trustee shall become vacant, a successor to the Individual
Trustee shall forthwith be appointed by the Corporate Trustee or, in the event
that the Corporate Trustee shall fail to make such appointment within 10 days
after the occurrence of such death, resignation, removal, incapacity or
vacancy, by the holders of at least 51% in aggregate principal amount of the
Notes at the time outstanding by an instrument signed by the Corporate Trustee
or by such holders, notice of which appointment shall be sent to the Company.
Section 7.16. Succession of Successor to Individual Trustee. Any Person
appointed as a successor to the Individual Trustee shall execute, acknowledge
and deliver to his predecessor, to the Corporate Trustee and to the Company, an
instrument accepting such appointment hereunder, and thereupon such Person
without any further act, deed or conveyance shall become vested with all the
estates, Properties, rights, powers, duties and trusts of his predecessor in
the trusts hereunder with like effect as if originally named as Individual
Trustee herein; but nevertheless, on the written request of the Company or of
the Corporate Trustee or of the Individual Trustee, the predecessor shall
execute and deliver an instrument transferring to the Individual Trustee, upon
the trusts expressed in this Indenture, all the estates, Properties, rights,
powers and trusts granted to him by this Indenture and shall duly assign,
transfer, deliver and pay over to the Individual Trustee any Property and money
subject to the lien of this Indenture held by such predecessor. Should any
instrument in writing from the Company or from the Corporate Trustee be
required by any Person who becomes the Individual Trustee for more fully and
certainly vesting in and
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confirming to such Individual Trustee such estates, Properties, rights, powers
and trusts, then, on request, any and all such instruments in writing shall be
made, executed, acknowledged and delivered by the Company and/or the Corporate
Trustee.
Section 7.17. Co-Corporate Trustees. At any time or times, for the
purpose of meeting the legal requirements of any jurisdiction in which any of
the Mortgaged Properties may be located, the Company and the Corporate Trustee
shall have the power to appoint, and, upon the written request of the Corporate
Trustee or of the holders of at least 51% in aggregate principal amount of the
Notes outstanding, the Company shall for such purpose join with the Corporate
Trustee in the execution, delivery and performance of all instruments and
agreements necessary or proper to appoint one or more Persons approved by the
Corporate Trustee either to act as co-trustee, jointly with the Corporate
Trustee, of all or any part of the Mortgaged Properties, or to act as separate
trustee of any Mortgaged Property, in either case with such powers as may be
provided in the instrument of appointment, and to vest in such Person or
Persons in the capacity aforesaid any part or portion of the Trust Estate,
title, right or power deemed necessary or desirable, subject to the other
provisions of this Section 7.17. If the Company does not join in such
appointment within 10 days after the receipt by it of a request so to do, or in
case a Default or Event of Default has occurred and is continuing, the
Corporate Trustee alone shall have power to make such appointment.
Should any written instrument from the Company be required by any
co-trustee or separate trustee so appointed for more fully confirming to such
co-trustee or separate trustee such part or portion of the Trust Estate, title,
right or power, any and all such instruments shall, on requires, be executed,
acknowledged and delivered by the Company.
Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following terms,
namely:
(a) The Notes shall be authenticated and delivered and all rights,
powers, duties and obligations hereunder in respect of the custody of
securities, cash and other personal property held by, or required to be
deposited or Pledged with, the Trustees hereunder, shall be exercised
solely by the Corporate Trustee.
(b) The rights, powers, duties and obligations hereby conferred or
conferred by any of the Mortgages or imposed upon the Trustees in respect
of any Property covered by such appointment shall be conferred or imposed
upon and exercised or performed by the Corporate Trustee or by the
Corporate Trustee and such co-trustee or separate trustee jointly, as
shall be provided in the instrument appointing such co-trustee or separate
trustee, except to the extent that under any law of any jurisdiction in
which any particular act is to be performed, the Corporate Trustee shall
be incompetent or unqualified to perform such act, in which event such
rights, powers, duties and obligations shall be exercised and performed by
such co-trustee or separate trustee.
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(c) The Corporate Trustee at any time, by an instrument in writing
executed by it, with the concurrence of the Company evidenced by an
Officer's Certificate, may accept the resignation of or remove any
co-trustee or separate trustee appointed under this Section 7.17, and, in
case a Default or Event of Default has occurred and is continuing, the
Corporate Trustee shall have power to accept the resignation of, or
remove, any such co-trustee or separate trustee without the concurrence of
the Company. Upon the written request of the Corporate Trustee, the
Company shall join with the Corporate Trustee in the execution, delivery
and performance of all instruments and agreements necessary or proper to
effectuate such resignation or removal. A successor to any co-trustee or
separate trustee that has so resigned or been removed may be appointed in
the manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be personally
liable by reason of any act or omission of the Corporate Trustee, or any
other such trustee hereunder nor shall the Corporate Trustee be liable by
reason of any act or omission of any co-trustee or separate trustee
hereunder.
(e) Any written direction of the holders of the Notes delivered to
the Corporate Trustee shall be deemed to have been delivered to each such
co-trustee and separate trustee.
SECTION 8. SUPPLEMENTAL INDENTURES, AMENDMENTS, WAIVERS AND CONSENTS.
Section 8.1. Supplemental Indentures, Amendments, Waivers and Consents by
Noteholders. Upon the waiver or consent of the holders of a least 66-2/3% in
aggregate principal amount of the Notes at the time outstanding (a) the Company
may take any action prohibited, or omit the taking of any action required, by
any of the provisions of this Indenture or any indenture supplemental hereto or
the provisions of any of the Mortgages, or (b) the Company, when authorized by
resolution of its Board of Directors or the Executive Committee of the Board of
Directors, and the Trustees, may enter into an indenture or indentures
supplemental hereto for the purpose of adding, changing or eliminating any
provisions of this Indenture or of any indenture supplemental hereto or enter
into any amendment to any of the Mortgages for the purpose of adding, changing
or eliminating any provision of such Mortgage or modifying in any other manner
the rights and obligations of the holders of the Notes and the Company;
provided that notwithstanding the foregoing (1) the waiver or consent of such
holders of the Notes shall not be required to enter into a supplemental
indenture to provide for the creation of any series of Improvement Notes
pursuant to and within the limitations of the provisions of Section 2.2 hereof
except to the extent such consent is expressly required by the terms and
provisions of Section 2.2(c)(1), and (2) no supplemental indenture, amendment,
waiver or consent shall:
(i) impair or affect the right of any holder to receive payments or
prepayments of the principal of and payments of the interest and
premium, if any, on its Note, as therein and herein provided,
without the consent of such holder,
(ii) amend Sections 6.1(a) and (b),
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(iii) other than pursuant to Section 2.2 hereof, permit the
creation of any lien prior to, or on a parity with, the lien of this
Indenture and the Mortgages with respect to any of the Mortgaged
Properties, without the consent of the holders of all the Notes at the
time outstanding,
(iv) effect the deprivation of any holder of the Notes of the
benefit of the lien of this Indenture upon all or any part of the Trust
Estate without the consent of such holder of the Notes,
(v) reduce the aforesaid percentage of the aggregate principal
amount of Notes, the holders of which are required to consent to any such
supplemental indenture, amendment, waiver or consent pursuant to this
Section, without the consent of the holders of all of the Notes at the
time outstanding, or
(vi) modify the rights, duties or immunities of the Corporate
Trustee or the Individual Trustee without its consent.
Section 8.2. Solicitation of Noteholders. The Company will not solicit,
request or negotiate for or with respect to any proposed supplemental
indenture, amendment, waiver or consent of any of the provisions of this
Indenture, any Mortgage or the Notes unless each holder of the Notes
(irrespective of the amount of Notes then owned by it) shall be informed
thereof by the Company and shall be afforded the opportunity of considering the
same and shall be supplied by the Company with sufficient information to enable
it to make an informed decision with respect thereto. The Company will not,
directly or indirectly, pay or cause to be paid any remuneration, whether by
way of supplemental or additional interest, fee or otherwise, to any holder of
the Notes as consideration for or as an inducement to the entering into by any
holder of the Notes of any amendment, waiver or consent with respect to any of
the terms and provisions of this Indenture, any Mortgage or the Notes unless
such remuneration is currently paid, on the same terms, ratably to the holders
of all of the Notes then outstanding.
Section 8.3. Notice of Supplemental Indentures Amendments, Waivers and
Consents. Within five Business Days after the execution by the Company and the
Trustees of any supplemental indenture, amendment, waiver or consent pursuant
to the provision of Section 8.1 hereof, the Company shall give written notice
setting in general terms the substance of such supplemental indenture,
amendment, waiver or consent together with a copy thereof, mailed in the manner
provided in Section 11.5 hereof, to each holder of the Notes at its address set
forth in the Register.
Section 8.4. Opinion of Counsel Conclusive as to Supplemental Indenture,
Amendment, Waiver and Consent. The Trustees are hereby authorized to join with
the Company in the execution of any such supplemental indenture, amendment,
waiver or consent authorized or permitted by the terms of this Indenture to
make the further. agreements and stipulations which may be therein contained,
and the Trustees may receive an Opinion of Counsel and an Officers' Certificate
as conclusive evidence that any
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supplemental indenture, amendment, waiver or consent executed pursuant to the
provisions of this Section 8 complies with the requirements of this Section 8.
Section 8.5. Expenses of Supplemental Indentures; Amendments, Waivers and
Consents. The Company hereby covenants and agrees to pay all fees, expenses
and disbursements of the Trustees and the holders of the Notes (including
without limitation, reasonable attorneys' fees and court costs) relating to any
supplemental indentures, amendments, waivers or consents pursuant to the
provisions of this Indenture, any of the Mortgages or the Notes (whether or not
the same are actually executed or delivered), including without limitation,
the fees, expenses and disbursements of the holders of the Notes and of an
investment banker or other firm acting as financial advisor to the holders of
the Notes following the occurrence and during the continuance of a Default or
an Event of Default or in connection with any supplemental indenture,
amendment, waiver or consent resulting from any work-out, restructuring or
similar proceeding relating to the performance or nonperformance by the Company
of its obligations under the provisions of this Indenture, any of the Mortgages
or the Notes as the result of any potential Default or Event of Default or
incurred in connection with the enforcement of rights hereunder or under any of
the Mortgages or under the Notes as a result of any potential Default or Event
of Default, whether or not a lawsuit is filed in connection therewith.
SECTION 9. ACTION BY NOTEHOLDERS.
Section 9.1. Evidence of Action by Noteholders. Whenever in this
Indenture it is provided that the holders of a specified percentage in
aggregate principal amount of the Notes 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 by any instrument or any number of instruments of similar tenor
executed by holders of the Notes in person or by attorney or proxy appointed in
writing.
Section 9.2. Noteholders' Execution of Instruments; Proof of Holdings.
The fact and date of the execution of any instrument by a holder of the Notes
or his attorney or proxy may be proved by the certificate under his official
seal of any notary public or other officer in any jurisdiction who, by the laws
thereof, has power to take acknowledgements or proof of deeds to be recorded
within such jurisdiction, that the Person who signed such instrument did
acknowledge before such notary public or other officer the execution thereof,
or by the affidavit of a witness to such execution; where such execution is by
an officer of a corporation or association or a member of a partnership on
behalf of such corporation, association or partnership such certificate or
affidavit shall also constitute sufficient proof of his authority.
SECTION 10. DISCHARGE.
Section 10.1. Discharge. If the Company shall pay and discharge the
whole amount of the principal of, premium if any, and interest on all Notes at
the time outstanding in
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accordance with the terms hereof and thereof and shall pay or cause to be paid
all other sums payable hereunder or under any of the Mortgages, then and in
that case all Property, rights and interests hereby conveyed or assigned or
Pledged shall revert to the Company, and the estate, right, title and interest
of the Trustees and the holders of the Notes therein shall thereupon cease,
terminate and become void; and the Trustees, in such case, on demand of the
Company and at its cost and expense, shall execute and deliver to the Company a
proper instrument or proper instruments acknowledging the satisfaction and
termination of this Indenture, and shall convey, assign and transfer, or cause
to be conveyed, assigned or transferred, and shall deliver or cause to be
delivered, to the Company, all Property, including money, then held by the
Trustees, other than moneys deposited with the Corporate Trustee for the
payment of the principal of and premium, if any, or interest on any Notes.
Without limiting the foregoing, if any Mortgage shall be terminated as and to
the extent contemplated by Section 4 hereof and upon satisfaction of the
Company's obligations pursuant to Section 5.2 or 5.3 hereof, as the case may
be, with respect to such Mortgaged Property, the Trustee shall, at the
Company's expense, do, execute, acknowledge and deliver each and every deed,
conveyance, transfer and release necessary or proper to evidence the release of
the Mortgage relating to such Mortgaged Property, whereupon such Mortgage and
the lien created thereby with respect to such Mortgaged Property shall
terminate and be of no further force and effect.
Section 10.2. Corporate Trustee's Retention of Moneys Deposited for
Payment of Notes. Payment of the Notes being so duly provided for, the Company
shall not be required to pay interest in respect of any period after the
maturity date. thereof to any holder of Notes, and moneys deposited for the
payment of principal or interest or for prepayment, or otherwise, remaining
unclaimed in the possession of the Corporate Trustee for six years after the
date of the maturity of the Notes or the date fixed for the prepayment of the
Notes, as the case may be, shall be repaid to the Company upon its request and
holders of such Notes shall thereafter be entitled to look only to the Company
for payment thereof. On the date payment of the Notes is due, the Trustees
shall pay the money deposited by the Company with the Corporate Trustee to the
holders of the Notes. If the Corporate Trustee does not pay to the holders of
the Notes as provided in Section 2.4 hereof the money so deposited by the
Company within one Business Day of such date of deposit, the Corporate Trustee
shall pay interest thereon at the Overdue Rate on any monies so deposited but
not so paid for the period from and including such date of deposit to but not
including the date of payment by the Corporate Trustee.
SECTION 11. MISCELLANEOUS PROVISIONS.
Section 11.1. Recapture. To the extent any holder of the Notes
receives any payment by or on behalf of the Company, which payment or any part
thereof is subsequently invalidated, declared to be fraudulent or preferential,
set aside or required to be repaid to the Company or its respective trustee,
receiver, custodian, liquidator or any other party under any bankruptcy law,
state or Federal law, common law or equitable cause, then to the extent of such
payment or repayment, the obligation or part thereof which has been paid,
reduced or satisfied by the amount so repaid shall be reinstated and shall be
included within
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the liabilities of the Company to the holders of the Notes as of the date such
initial payment, reduction or satisfaction occurred.
Section 11.2. Indenture for Benefit of Parties Hereto. Nothing in this
Indenture, expressed or implied, is intended or shall be construed to confer
upon or to give to, any Person other than the parties hereto, and the holders
of the Notes, any right, remedy or claim under or by reason of this Indenture
or any covenant, condition or stipulation hereof; and the covenants,
stipulations and agreements in this Indenture contained are and shall be for
the sole and exclusive benefit of the parties hereto, their successors and
assigns, and the holders of the Notes.
Section 11.3. Severability. In case any one or more of the provisions
contained in this Indenture or in the Notes shall be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein and therein shall not in any way be
affected or impaired thereby.
Section 11.4. Basis of Opinions of Counsel and Certificates. Any Opinion
of Counsel required to be furnished pursuant to any of the provisions of this
Indenture may, in lieu of stating the facts required by the provisions hereof,
state that the required conditions will be fulfilled on the execution and
delivery of designated instruments, which instruments shall be delivered in
form approved by such counsel prior to or concurrently with the taking or
suffering by the Corporate Trustee of the action as a condition precedent to
which such opinion is required to be furnished under the terms of this
Indenture.
Any certificate or opinion of an officer of the Company or an accountant
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of or upon representations by counsel, unless such officer or
accountant knows that the certificates or opinions or representations with
respect to the matters upon which his opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should have known that the
same were erroneous.
Any Opinion of Counsel may be based, insofar as it relates to factual
matters, or information with respect to which is in the possession of the
Company, upon the certificate or opinion of or representations by an officer or
officers of the Company unless such counsel knows that the certificate or
opinion or representations with respect to the matters upon which his opinion
may be based as aforesaid are erroneous, or in the exercise of reasonable care
should have known that the same were erroneous.
Section 11.5. Addresses for Notices and Demands. Any notice to or
demand upon the Corporate Trustee or the Individual Trustee may be served or
presented, and such demand may be made, in writing by telex, telegraph,
telecopy or other means of recorded electronic communication (with a copy of
any such communication promptly mailed by registered or certified mail or
prepaid nationally recognized overnight air courier service) or by prepaid
nationally recognized overnight air courier service, in any such case at the
principal office of the Corporate Trustee, XXX, Attention: Corporate Trust
Department. Any notice to or demand upon the Company may be served
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or presented, and such demand may be made to the Company in writing, by means
of telex, telegraph, telecopy or by other means of recorded electronic
communication (with a copy of any such communication promptly mailed by
registered or certified mail or prepaid nationally recognized overnight air
courier service) or by prepaid nationally recognized overnight air courier
service, in any such case to the Company at International Headquarters, ▇▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Treasurer, or to
the Company at such other address as may be filed in writing by the Company
with the Corporate Trustee. A copy of any notice served or presented to the
Trustees or the Company shall be sent to each of the holders of the Notes. Any
notice or report required by any provision of this Indenture to be given or
made to holders of the Notes shall be deemed to have been sufficiently given or
made if copies thereof are sent to the holders of the Notes in writing, by
means of telex, telegraph, telecopy or other by other means of recorded
electronic communication (with a copy of any such communication promptly mailed
by registered or certified mail or prepaid nationally recognized overnight air
courier service) or by prepaid nationally recognized overnight air courier
service, in any such case addressed to each holder of the Notes at the address
of such holder set forth in the Register.
Section 11.6. Environmental Indemnity and Covenant Not to ▇▇▇. (a) The
Company agrees to indemnify and hold harmless the Trustees and each holder of
the Notes, each Person claiming by, through, under or on account of any of the
foregoing and the respective directors, officers, counsel and employees of each
of the foregoing Persons (the "Indemnified Parties") from and against any and
all losses, claims, cost recovery actions, administrative orders or
proceedings, damages and liabilities to which any such Indemnified Party may
become subject (a) under any Environmental Legal Requirement applicable to the
Company or any of the Mortgaged Properties, including without limitation the
treatment or disposal of Hazardous Substances on any of the Mortgaged
Properties, (b) as a result of the breach or non-compliance by the Company with
any Environmental Legal Requirement applicable to the Company or any of the
Mortgage Properties and (c) due to past ownership of any of the Mortgaged
Properties or past activity on any of the Mortgaged Properties which, though
lawful and fully permissible at the time, could result in present liability.
The provisions of this Section 11.6(a) shall survive termination of this
Indenture by payment in full of all of the Notes issued hereunder, by the
foreclosure by the Trustees on the Mortgaged Properties under this Indenture or
any of the Mortgages or otherwise, and shall survive the transfer of any Note
or Notes issued hereunder.
(b) Without limiting the provisions of clause (a) of this Section 11.6,
the Company and its successors and assigns hereby waive, release and covenant
not to bring against any of the Indemnified Parties any demand, claim, cost
recovery action or lawsuit they may now or hereafter have or accrue arising
from (1) any Environmental Legal Requirement now or hereafter enacted
(including those applicable to the Company or any of the Mortgaged Properties,
(2) the presence, use, release, storage, treatment or disposal of Hazardous
Substances on or at any of the Mortgaged Properties, (3) the breach or
non-compliance by the Company with any Environmental Legal Requirement or
environmental covenant applicable to the Company or any of the Mortgaged
Properties, or (4) any environmental, health or safety condition on or at any
of the Mortgaged Properties.
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(c) Notwithstanding any provision in any Deed of Trust relating to any
Mortgaged Property located in California to the contrary, neither the
obligations of, or the payment of any amount by, the Company under this Section
11.6 shall be secured by any such California Deed of Trust, and the Trustee may
enforce the provisions of this Section 11.6 with respect to any of the
Mortgaged Properties located in California by appropriate proceedings in
accordance with Section 736 of the California Code of Civil Procedure. The
Company acknowledges and agrees that, in accordance with Section 736 of the
California Code of Civil Procedure, such proceedings shall not constitute an
action within the meaning of subdivision (a) of Section 726 of the California
Code of Civil Procedure.
Section 11.7. Successors and Assigns. Whenever in this Indenture any of
the parties hereto is named or referred to, the successors and assigns of such
party shall be deemed to be included, and all the covenants, promises and
agreements in this Indenture contained by or on behalf of the Company, or by or
on behalf of the Trustees, shall bind and inure to the benefit of the
respective successors and assigns, whether so expressed or not.
Section 11.8. Counterparts; Descriptive Headings. This Indenture is being
executed in any number of counterparts, each of which is an original and all of
which are identical. Each counterpart of this Indenture is to be deemed an
original hereof and all counterparts collectively are to be deemed but one
instrument. The descriptive headings of the several Sections of and Exhibits
to this Indenture were formulated, used and inserted in this Indenture for
convenience only and shall not be deemed to affect the meaning or construction
of any of the provisions hereof.
Section 11.9. Governing Law. THIS INDENTURE AND THE NOTES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE
CONFLICTS LAW) OF THE STATE OF MICHIGAN.
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IN WITNESS WHEREOF, Kmart Corporation has caused this Indenture to be
executed on its behalf by its Vice President; and XXX in evidence of its
acceptance of the trusts hereby created, has caused this Indenture to be
executed on its behalf by one of its Assistant Secretary , and XXXXXXXXXX in
token of his acceptance of the trusts hereby created, has hereunto set his
hand and seal, all as of the date first above written.
KMART CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
Its Vice President
XXX
By /s/ XXXXXXXXXX
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Its Assistant Secretary
As Corporate Trustee
/s/ XXXXXXXXXX
-------------------------------
XXXXXXXXXX
As Individual Trustee
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