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EXHIBIT 4.1
CS FINANCING CORPORATION
SUBORDINATED 5 YEAR NOTES
INDENTURE
DATED AS OF NOVEMBER 7, 2005
U.S. BANK NATIONAL ASSOCIATION
AS
TRUSTEE
TABLE OF CONTENTS
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INDENTURE dated as of November 7, 2005, between CS Financing Corporation, a Delaware corporation (“Company”), and U.S. Bank National Association, a national banking association (“Trustee”).
Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Company’s 5 Year Notes:
ARTICLE 1
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Term |
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Defined in |
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“ Additional Interest ” |
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2.2(b) |
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“ Bankruptcy Law ” |
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6.1 |
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“ Custodian ” |
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6.1 |
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“ Debt ” |
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10.2 |
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“ Event of Default ” |
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6.1 |
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“ Legal Holiday ” |
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11.7 |
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“ Officer ” |
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11.10 |
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“ Representative ” |
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10.2 |
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“ Senior Debt ” |
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10.2 |
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“ U.S. Government Obligations ” |
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8.1 |
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Section 1.3. Incorporation by Reference of TIA .
Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
“ Indenture Securities ” means the 5 Year Notes;
“ Indenture Security Holder ” means a Certificateholder;
“Indenture to be Qualified” means this Indenture;
“Indenture Trustee” or “Institutional Trustee” means the Trustee; and
“ Obligor ” on the 5 Year Notes means the Company.
All other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute, or defined by SEC rule under the TIA have the meanings assigned to them.
Section 1.4. Rules of Construction .
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to it in accordance with United States generally accepted accounting principles in effect on the date of execution of this Indenture;
(3) “or” is not exclusive;
(4) words in the singular include the plural, and in the plural include the singular; and
(5) provisions apply to successive events and transactions.
ARTICLE 2
THE 5 YEAR NOTES
Section 2.1. Form and Dating .
The 5 Year Notes shall be substantially in the form of EXHIBIT A, with such appropriate insertions, omissions, substitutions and other variations required or permitted by this Indenture. The 5 Year Notes may have notations, legends or endorsements required by law, stock exchange rule or usage.
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Section 2.2. Terms .
(a) Amount Unlimited; Terms. The aggregate principal amount of 5 Year Notes which may be delivered under this Indenture is unlimited. 5 Year Notes may be issued in one or more series. The initial aggregate principal amount of the 5 Year Notes to be delivered under this Indenture shall be $100,000,000. The aggregate principal amount may be increased, without the need for approval of any Holders or the Trustee by means of Company Order, as set forth in Section 9.1.
(b) Interest. The interest rate payable on any 5 Year Note shall be a fixed rate of 11% per annum.
(c) Subordination. The 5 Year Notes shall be subordinated and junior in right of payment to all Senior Debt of the Company as provided in Article 10.
Section 2.3. Execution .
Two Officers, consisting of the President or a Vice President and the Treasurer or Secretary, shall sign the 5 Year Notes for the Company by manual or facsimile signature.
If an Officer whose signature is on a 5 Year Note no longer holds that office at the time the 5 Year Note is delivered, the 5 Year Note shall nevertheless be valid.
Section 2.4. Registrar and Paying Agent .
The Company shall maintain an office or agency where 5 Year Notes may be presented for registration of transfer or for exchange (“ Registrar ”) and an office or agency where 5 Year Notes may be presented for payment (“ Paying Agent ”). The Registrar shall keep a register of the 5 Year Notes and of their transfer and exchange. The Company may appoint one or more co-registrars and one or more additional paying agents. The Company may change any Paying Agent, Registrar or co-registrar without notice to any Certificateholder. The term “ Paying Agent ” includes any additional paying agent. The Company shall notify the Trustee of the name and address of any agent not a party to this Indenture. The Company or any of its subsidiaries may act as Paying Agent or Registrar. The Company initially appoints itself as Paying Agent and Registrar.
Section 2.5. Paying Agent to Hold Money in Trust .
The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent will hold in trust for the benefit of Certificateholders or the Trustee all money held by the Paying Agent for the payment of principal or interest on the 5 Year Notes, and will notify the Trustee of any failure by the Company in making any such payment. While any such failure continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent shall have no further liability for the money. If the Company acts as Paying
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Agent, it shall segregate and hold in a separate bank account for the benefit of the Certificateholders all money held by it as Paying Agent. The Paying Agent may charge for its expenses in issuing a replacement interest check.
Section 2.6. Certificateholder Lists .
The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Certificateholders. If the Trustee is not the Registrar, the Company shall timely furnish to the Trustee the changes in this list and will furnish an updated list of the names and addresses of Certificateholders in such form and as of such date and at such other times as the Trustee may request in writing.
Section 2.7. Transfer and Exchange .
Where 5 Year Notes are presented to the Registrar or a co-registrar with a request to register, transfer or to exchange them for an equal principal amount of 5 Year Notes but of other denominations, the Registrar shall register the transfer or make the exchange if its requirements for such transactions are met. To permit registrations of transfer and exchanges, the Company shall issue 5 Year Notes at the Registrar’s request. The Company may charge for its expenses in transferring or exchanging a 5 Year Note.
The Company shall not be required (i) to issue, transfer or exchange any 5 Year Note during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of 5 Year Notes selected for redemption pursuant to Section 3.3 and ending at the close of business on the date of such redemption, or (ii) to transfer or exchange any 5 Year Note selected for redemption in whole or in part.
Section 2.8. Replacement 5 Year Notes .
If the Holder of a 5 Year Note claims that the 5 Year Note has been lost, destroyed or wrongfully taken, the Company shall issue a replacement 5 Year Note if the Trustee’s requirements are met. If required by the Trustee or the Company, an indemnity bond must be sufficient in the judgment of both the Company and the Trustee to protect the Company, the Trustee or any Agent from any loss which any of them may suffer if a 5 Year Note is replaced.
The Trustee may waive such indemnity bond if so instructed by the Company. The Company may charge for its expenses in replacing a 5 Year Note.
Every replacement 5 Year Note is an additional obligation of the Company.
Section 2.9. Outstanding 5 Year Notes .
The 5 Year Notes outstanding at any time are all of the 5 Year Notes delivered by the Company pursuant to this Indenture except for those canceled by it, those
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delivered to it for cancellation, and those described in this Section as not outstanding.
If a 5 Year Note is replaced pursuant to Section 2.8, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced 5 Year Note is held by a bona fide purchaser.
If 5 Year Notes are considered paid under Section 4.1, they cease to be outstanding and interest on them ceases to accrue.
Section 2.10. Treasury 5 Year Notes .
In determining whether the Holders of the required principal amount of the 5 Year Notes have concurred in any direction, waiver or consent, 5 Year Notes owned by the Company or an Affiliate shall be disregarded, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only 5 Year Notes which the Trustee knows are so owned shall be so disregarded.
Section 2.11. Temporary 5 Year Notes .
Until definitive 5 Year Notes are ready for delivery, the Company may prepare temporary 5 Year Notes. Temporary 5 Year Notes shall be substantially in the form of definitive 5 Year Notes but may have variations that the Company considers appropriate. Without unreasonable delay, the Company shall prepare definitive 5 Year Notes in exchange for temporary 5 Year Notes.
Section 2.12. Cancellation .
The Company at any time may deliver 5 Year Notes to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any 5 Year Notes surrendered to them for registration of transfer, exchange or payment. The Trustee shall cancel all 5 Year Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall dispose of canceled 5 Year Notes as the Company directs. The Company may not issue new 5 Year Notes to replace 5 Year Notes that it has paid or that have been delivered to the Trustee for cancellation.
ARTICLE 3
REDEMPTION
Section 3.1. Applicability of Article .
Redemption of 5 Year Notes at the election of the Company, as permitted or required by any provision of this Indenture, shall be made in accordance with such provision and this Article.
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Section 3.2. Notices to Trustee .
If the Company wants to redeem the 5 Year Notes pursuant to paragraph 2 of the 5 Year Notes, it shall notify the Trustee by Officers’ Certificate of the redemption date and the principal amount of 5 Year Notes to be redeemed. The Company shall give each notice provided for in this Section at least fifty (50) days before the redemption date.
Section 3.3. Selection of 5 Year Notes to be Redeemed .
If fewer than all the 5 Year Notes are to be redeemed, the Company shall select the 5 Year Notes to be redeemed by daily balance range, and so inform the Trustee by Officers’ Certificate, subject to the remainder of this Section. If less than all of a grouping of 5 Year Notes, as specified by Officers’ Certificate, are to be redeemed, the portion thereof selected for redemption shall be determined ratably or by lot. If fewer than all of such grouping of 5 Year Notes as specified by Officers’ Certificate are to be redeemed, the Trustee shall then make the selection not more than fifty (50) days before the redemption date from 5 Year Notes outstanding not previously called for redemption. The Trustee may select for redemption portions of the principal of 5 Year Notes that have denominations greater than $5,000. Provisions of this Indenture that apply to 5 Year Notes called for redemption also apply to portions of 5 Year Notes called for redemption. The Trustee shall notify the Company promptly of the 5 Year Notes or portions of 5 Year Notes to be called for redemption.
Section 3.4. Notice of Redemption .
At least thirty (30) days but not more than sixty (60) days before a redemption date, the Company shall mail a notice of redemption by first-class mail to each Holder of 5 Year Notes whose 5 Year Notes are to be redeemed.
The notice shall identify the 5 Year Notes to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price, which shall be equal to 100% of the principal amount of the 5 Year Note plus accrued interest on a daily basis to the redemption date;
(3) the name and address of the Paying Agent;
(4) that 5 Year Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price; and
(5) that interest on 5 Year Notes called for redemption ceases to accrue on and after the redemption date.
At the Company’s request, the Trustee shall give the notice of redemption in the Company’s name and at its expense.
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Section 3.5. Effect of Notice of Redemption .
Once notice of redemption is mailed, 5 Year Notes called for redemption become due and payable on the redemption date at the redemption price.
Section 3.6. Deposit of Redemption Price .
On or before the redemption date, the Company shall deposit with the Paying Agent, or if the Company is acting as Paying Agent it shall deposit into a separate bank account pursuant to Section 2.5 hereof, money sufficient to pay the redemption price of and accrued interest on all 5 Year Notes to be redeemed on that date.
Section 3.7. 5 Year Notes Redeemed in Part .
Upon surrender of a 5 Year Note that is redeemed in part, the Company shall issue for the Holder a new 5 Year Note equal in principal amount to the unredeemed portion of the 5 Year Note surrendered.
Section 3.8. Redemption if Balance Falls Below $5,000 .
The Company may, in its sole discretion, redeem any 5 Year Note in full if the principal balance of such 5 Year Note falls below $5,000 at any time. The redemption price shall be equal to 100% of the principal amount of the 5 Year Note plus accrued interest on a daily basis to the redemption date. This redemption right of the Company shall be automatic and no advance notice is required.
ARTICLE 4
COVENANTS
Section 4.1. Payment of 5 Year Notes .
The Company shall pay the principal of and interest on the 5 Year Notes upon demand of the Holder in the manner provided in the 5 Year Notes. Principal and interest shall be considered paid on the date due if the Paying Agent holds on that date money designated for and sufficient to pay all principal and interest then due.
Section 4.2. SEC Reports .
The Company shall file with the Trustee within fifteen (15) days after it files them with the SEC copies of the annual reports and quarterly reports and of the information, documents, and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) for the 5 Year Notes which the Company may be required to file with the SEC pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended. The Company also shall comply with the other provisions of TIA Section 314(a).
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Section 4.3. Compliance Certificate .
The Company shall deliver to the Trustee, within one hundred twenty (120) days after the end of each fiscal year of the Company, an Officers’ Certificate stating that a review of the activities of the Company and its subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether the Company has kept, observed, performed and fulfilled its obligations under this Indenture, and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge the Company has kept, observed, performed and fulfilled each and every covenant contained in this Indenture and is not in default in the performance or observance of any of the terms, provisions and conditions hereof (or, if a Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which he or she may have knowledge) and that to the best of his or her knowledge no event has occurred and remains in existence by reason of which payments on account of the principal of or interest, if any, on the 5 Year Notes are prohibited. See Section 11.10.
Section 4.4. Usury Laws .
The Company will not voluntarily claim and will actively resist any attempts to claim the benefit of any usury laws against the Holders of the 5 Year Notes.
Section 4.5. Money for 5 Year Note Payments to be Held in Trust .
Whenever the Company shall have one or more Paying Agents, it will, on or prior to each date for the payment of the principal of or interest on the 5 Year Notes, deposit with a Paying Agent a sum sufficient to pay the principal and interest so becoming due, such sum to be held in trust for the benefit of the persons entitled to such payments; and, unless such Paying Agent is the Trustee, the Company will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of and interest on the 5 Year Notes in trust for the benefit of the persons entitled thereto until such sums shall be paid to such persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any other obligor upon the 5 Year Notes) in the making of any payment of principal and interest; and
(3) at any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such Paying Agent.
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For the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, the Company may at any time pay, or direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same terms as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by the Company or any Paying Agent to the Trustee, the Company or such Paying Agent, as the case may be, shall be released from all further liability with respect to such money.
Section 4.6. Continued Existence .
Subject to Article 5, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its existence as a corporation.
ARTICLE 5
SUCCESSORS
Section 5.1. When Company May Merge, Etc .
The Company shall not consolidate or merge with or into, or transfer or lease all or substantially all of its assets to, any Person unless the corporation formed by or surviving any such consolidation or merger (if other than the Company), or to which such sale or conveyance shall have been made, assumes by supplemental indenture all the obligations of the Company under the 5 Year Notes then outstanding and this Indenture.
The Company shall deliver to the Trustee prior to the proposed transaction an Officers’ Certificate to the foregoing effect and an Opinion of Counsel stating that the proposed transaction and such supplemental indenture comply with this Indenture.
The surviving corporation shall be the successor Company, but the predecessor Company in the case of a transfer or lease shall not be released from the obligation to pay the principal of and interest on the 5 Year Notes.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.1. Events of Default .
An “ Event Of Default ” occurs if:
(1) the Company defaults in the payment of the principal and interest of any 5 Year Note when the same is presented for payment, upon redemption or otherwise, which default has not been cured for a period of thirty (30) days;
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(2) the Company fails to comply with any of its other agreements or covenants in, or provisions of, the 5 Year Notes or this Indenture and the Default continues for the period and after the notice specified below;
(3) the Company or any material subsidiary pursuant to or within the meaning of any Bankruptcy Law now or hereafter in effect:
(A) commences a voluntary proceeding under any such Bankruptcy Law;
(B) consents to the entry of an order for relief against it in an involuntary Bankruptcy proceeding;
(C) consents to the appointment of a Custodian of it or for all or substantially all of its property;
(D) makes a general assignment for the benefit of its creditors; or
(E) generally is unable to pay its debts as the same become due;
(4) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(A) is for relief against the Company or any material subsidiary in an involuntary Bankruptcy proceeding;
(B) appoints a Custodian of the Company or any material subsidiary or for all or substantially all of its property; or
(C) orders the winding up or liquidation of the Company or any material subsidiary, and the order or decree remains unstayed and in effect for 60 days.
The term “ Bankruptcy Law ” means Title 11 of the United States Code or any similar Federal or State Law for the relief of debtors. The term “ Custodian ” means any receiver, trustee, assignee, liquidator, sequestrator or similar official under any Bankruptcy Law.
A Default under clause (3) is not an Event of Default until the Trustee or the Holders of at least 25% in principal amount of the then outstanding 5 Year Notes notify the Company of the Default and the Company does not cure the Default within sixty (60) days after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a “ Notice of Default .”
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Section 6.2. Acceleration .
If an Event of Default occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least 25% in principal amount of the then outstanding 5 Year Notes, by notice to the Company and the Trustee, may declare the principal of and accrued interest on all the 5 Year Notes to be due and payable. Upon such declaration the principal and interest owing on the then outstanding 5 Year Notes shall be due and payable immediately The Holders of a majority in principal amount of the then outstanding 5 Year Notes, by notice to the Trustee, may rescind an acceleration and its consequences if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived, except nonpayment of principal or interest that has become due solely because of the acceleration.
Section 6.3. Other Remedies .
If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal and interest on the 5 Year Notes or to enforce the performance of any provision of the 5 Year Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of the 5 Year Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder of 5 Year Notes in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law.
Section 6.4. Waiver of Past Defaults .
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AGREEMENTS / CONTRACTS
CLAUSES
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