THE MONEY TREE INC. SERIES A VARIABLE RATE SUBORDINATED DEBENTURES INDENTURE

 

Exhibit 4.1

 

THE MONEY TREE INC.

 

SERIES A VARIABLE RATE SUBORDINATED DEBENTURES

 

 

INDENTURE

 

DATED AS OF ___________, 2005

 

 

U.S. BANK NATIONAL ASSOCIATION

 

AS

 

TRUSTEE

 

 

CROSS-REFERENCE TABLE

 

 

N.A. means not applicable.

 

* This Cross-Reference Table is not part of the Indenture.

 

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TABLE OF CONTENTS

 

 

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INDENTURE dated as of                          , 2005, between The Money Tree Inc., a Georgia 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 Series A Variable Rate Subordinated Debentures:

 

ARTICLE 1

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.1. Definitions .

 

“ Affiliate ” means any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company.

 

“ Agent ” means any Registrar, Paying Agent or co-registrar.

 

“ Board of Directors ” means the Board of Directors of the Company or any authorized committee of the Board.

 

“ Company ” means the party named as such above until a successor replaces it and thereafter means the successor or any other obligor with respect to the Debentures.

 

“ Company Order ” means an order signed in the name of the Company by its President or a Vice President, and by its Treasurer or Secretary, and delivered to the Trustee.

 

“ Date of Issue ” means the date that the Company receives proper documentation and the funds for the purchase of a Debenture if such funds are received prior to 3:00 p.m. on a business day or the next business day if the Company receives such funds on a non-business day or after 3:00 p.m. on a business day. For this purpose, the Company’s business days will be deemed to be Monday through Friday, except on Georgia legal holidays.

 

“ Debentures ” means the Series A Variable Rate Subordinated Debentures described herein issued under this Indenture.

 

“ Default ” means any event which is, or after notice or passage of time would be, an Event of Default.

 

“ Demand Notes ” means the Subordinated Demand Notes issued by the Company under a separate Indenture ranking pari passu with the Debentures issued hereunder.

 

“ Holder ” or “ Certificateholder ” means a person in whose name a Debenture is registered.

 

“ Indenture ” means this Indenture as amended from time to time.

 

“ Officers’ Certificate ” means a certificate signed by an officer of the Company.

 

“ Opinion of Counsel ” means a written opinion from legal counsel who is acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee.

 

“ Person ” means any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

 

“ Principal ” of a debt security means the principal of the security plus the premium, if any, on the security.

 

“ SEC ” means the United States Securities and Exchange Commission.

 

“ Stated Maturity ,” when used with respect to a Debenture, means the date specified in such Debenture as the fixed date on which the principal of such Debenture and any accrued but unpaid interest is due and payable.

 

“ Subsidiary ” means any person of which at least a majority of capital stock having ordinary voting power for the election of directors or other governing body of such person is owned by the Company directly or through one or more subsidiaries.

 

“ TIA ” means the Trust Indenture Act of 1939 (15 U.S. Code 77aaa-77bbbb) as in effect on the date of execution of this Indenture.

 

“ Trustee ” means the party named as such above until a successor replaces it and thereafter means the successor.

 

“ Trust Officer ” means the Chairman of the Board, the President or any other officer or assistant officer of the Trustee assigned by the Trustee to administer its corporate trust matters.

 

Section 1.2. Other Definitions .

 

 

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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 Debentures;

 

“ 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 Debentures 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 DEBENTURES

 

Section 2.1. Form and Dating .

 

The Debentures 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 Debentures 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 Debentures which may be delivered under this Indenture is unlimited. Debentures may be issued in one or more series. The initial aggregate principal amount of the Debentures to be delivered under this Indenture shall be $75,000,000. 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. Each Debenture shall bear interest from its Date of Issue for the applicable interest adjustment period selected by the Holder, and for each successive interest adjustment period thereafter, at an annual rate compounded daily, which shall be determined at the beginning of each interest adjustment period by the Company in its sole discretion as set forth in the prospectus supplement most recently filed by the Company with the SEC, or if the Company does not have an effective registration statement on file with the SEC, as published by the Company. Interest will be earned daily and is payable at any time at the Holder’s request.

 

(c)

Subordination. The Debentures 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 Debentures for the Company by manual or facsimile signature.

 

If an Officer whose signature is on a Debenture no longer holds that office at the time the Debenture is delivered, the Debenture shall nevertheless be valid.

 

Section 2.4. Registrar and Paying Agent .

 

The Company shall maintain an office or agency where Debentures may be presented for registration of transfer or for exchange (“ Registrar ”) and an office or agency where Debentures may be presented for payment (“ Paying Agent ”). The Registrar shall keep a register of the Debentures 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

 

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money held by the Paying Agent for the payment of principal or interest on the Debentures, 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 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 Debentures 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 Debentures 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 Debentures at the Registrar’s request. The Company may charge for its expenses in transferring or exchanging a Debenture.

 

The Company shall not be required (i) to issue, transfer or exchange any Debenture during a period beginning at the opening of business 15 days before either (A) the day of the mailing of a notice of redemption of Debentures selected for redemption pursuant to Section 3.3 and ending at the close of business on the date of such redemption or (B) the date of the maturity of that Debenture and ending on such maturity date, or (ii) to transfer or exchange any Debenture selected for redemption in whole or in part.

 

Section 2.8. Replacement Debentures .

 

If the Holder of a Debenture claims that the Debenture has been lost, destroyed or wrongfully taken, the Company shall issue a replacement Debenture 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 Debenture 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 Debenture.

 

Every replacement Debenture is an additional obligation of the Company.

 

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Section 2.9. Outstanding Debentures .

 

The Debentures outstanding at any time are all of the Debentures delivered by the Company pursuant to this Indenture except for those canceled by it, those delivered to it for cancellation, and those described in this Section as not outstanding.

 

If a Debenture is replaced pursuant to Section 2.8, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Debenture is held by a bona fide purchaser.

 

If Debentures are considered paid under Section 4.1, they cease to be outstanding and interest on them ceases to accrue.

 

Section 2.10. Treasury Debentures .

 

In determining whether the Holders of the required principal amount of the Debentures have concurred in any direction, waiver or consent, Debentures 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 Debentures which the Trustee knows are so owned shall be so disregarded.

 

Section 2.11. Temporary Debentures .

 

Until definitive Debentures are ready for delivery, the Company may prepare temporary Debentures. Temporary Debentures shall be substantially in the form of definitive Debentures but may have variations that the Company considers appropriate. Without unreasonable delay, the Company shall prepare definitive Debentures in exchange for temporary Debentures.

 

Section 2.12. Cancellation .

 

The Company at any time may deliver Debentures to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any Debentures surrendered to them for registration of transfer, exchange or payment. The Trustee shall cancel all Debentures surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall dispose of canceled Debentures as the Company directs. The Company may not issue new Debentures to replace Debentures that it has paid or that have been delivered to the Trustee for cancellation.

 

Section 2.13. Defaulted Interest .

 

If the Company fails to make a payment of interest on the Debentures, it shall pay such interest thereafter in any lawful manner. It shall pay such interest, plus any interest payable on it, to the persons who are Certificateholders of Debentures on a subsequent special record date. The Company shall fix the special record date and payment date. At least 15 days before the special record date, the Company shall mail to Certificateholders of Debentures a notice that states the special record date, payment date, and amount of such interest to be paid.

 

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ARTICLE 3

 

REDEMPTION

 

Section 3.1. Applicability of Article .

 

Redemption of Debentures 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.

 

Section 3.2. Notices to Trustee .

 

If the Company wants to redeem the Debentures pursuant to paragraph 1 of the Debentures, it shall notify the Trustee by Officers’ Certificate of the redemption date and the principal amount of Debentures 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 Debentures to be Redeemed .

 

If fewer than all the Debentures are to be redeemed, the Company shall select the Debentures to be redeemed by interest adjustment period or maturity, and so inform the Trustee by Officers’ Certificate, subject to the remainder of this Section. If less than all of a grouping of Debentures, 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 Debentures 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 Debentures outstanding not previously called for redemption. The Trustee may select for redemption portions of the principal of Debentures that have denominations greater than $100. Provisions of this Indenture that apply to Debentures called for redemption also apply to portions of Debentures called for redemption. The Trustee shall notify the Company promptly of the Debentures or portions of Debentures 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 Debentures whose Debentures are to be redeemed.

 

The notice shall identify the Debentures 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 Debenture plus accrued interest on a daily basis to the redemption date;

 

(3)

the name and address of the Paying Agent;

 

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(4)

that Debentures called for redemption must be surrendered to the Paying Agent to collect the redemption price; and

 

(5)

that interest on Debentures 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.

 

Section 3.5. Effect of Notice of Redemption .

 

Once notice of redemption is mailed, Debentures 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 Debentures to be redeemed on that date.

 

Section 3.7. Debentures Redeemed in Part .

 

Upon surrender of a Debenture that is redeemed in part, the Company shall issue for the Holder a new Debenture equal in principal amount to the unredeemed portion of the Debenture surrendered.

 

Section 3.8. Redemption Option Upon Death of Holder .

 

(a)

Subject to the provisions of Article 10 and this Article 3, upon the death of any Holder of one or more Debentures, the Company shall be required to redeem Debentures held by a Holder of such Debentures at the date of such Holder’s death, as requested in the manner, and subject to the limitations, set forth below. The redemption price shall be equal to 100% of the principal amount of the Debenture plus accrued interest on a daily basis to the redemption date. Redemption of such Debentures shall be made within 30 days following the receipt by the Company or the Trustee of all of the following:

 

(1)

a written request for redemption of the Debentures signed by a duly authorized representative of the Holder, which request shall set forth the name of the Holder, the date of death of the Holder and the principal amount of the Debentures to be redeemed;

 

(2)

the Debentures to be redeemed; and

 

(3)

evidence satisfactory to the Trustee and the Company of the death of such Holder and the authority of the representative to such extent as may be required by the Trustee or Company.

 

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(b)

The Debentures held by the Holder shall not be entitled to redemption pursuant to this Section unless all of the following conditions are met:

 

(1)

the Debentures to be redeemed have been registered in the Holder’s name since their Date of Issue; and

 

(2)

either the Company or the Trustee has been notified in writing of the request for redemption within 180 days after the date of the Holder’s death.

 

(c)

Authorized representatives of a Holder shall include the following: executors, administrators or other legal representatives of an estate; trustees of a trust; joint owners of Debentures owned in joint tenancy or tenancy by the entirety; attorneys-in-fact; and other persons generally recognized as having legal authority to act on behalf of another.

 

Section 3.9. Redemption Option at Request of Holder .

 

At the request of the Holder, but subject to the restrictions of Article 10 below, the Company will redeem the Debenture at the end of any interest adjustment period for a redemption price equal to the principal amount plus any unpaid interest thereon to the date of redemption. Furthermore, at the written request of the Holder delivered to the Company, the Company may, at its option and subject to the restrictions of Article 10 below, but shall not be required to, redeem the Debenture during any interest adjustment period for a redemption price equal to the principal amount plus an amount equal to the unpaid interest thereon for the Debenture, as adjusted, at the stated rate to the redemption date minus an amount equal to the interest that would be payable thereon at the rate stated above for a 90-day period beginning on the first date of the interest adjustment period.

 

ARTICLE 4

 

COVENANTS

 

Section 4.1. Payment of Debentures .

 

The Company shall pay the principal of and interest on the Debentures on the dates and in the manner provided in the Debentures. 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.

 

The Company shall pay interest on overdue principal at the rate borne by the Debentures, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.

 

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

 

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regulations prescribe) for the Debentures 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).

 

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 Debentures 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 Debentures.

 

Section 4.5. Money for Debenture 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 Debentures, deposit with a Paying Agent a sum sufficient to pay the principal or 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 or interest on the Debentures 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 Debentures) in the making of any payment of principal or interest; and

 

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(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.

 

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 Debentures 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 Debentures.

 

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 interest on any Debenture when the same becomes due and payable and the Default continues for a period of thirty (30) days;

 

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(2)

the Company defaults in the payment of the principal of any Debenture when the same becomes due and payable at maturity, upon redemption or otherwise, and the Default continues for a period of thirty (30) days;

 

(3)

the Company fails to comply with any of its other agreements or covenants in, or provisions of, the Debentures or this Indenture and the Default continues for the period and after the notice specified below;

 

(4)

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;

 

(5)

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 Debentures 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 Debentures, by notice to the Company and the Trustee, may declare the principal of and accrued interest on all the Debentures to be due and payable. Upon such declaration the principal and interest owing on the then outstanding Debentures shall be due and payable immediately. The Holders of a majority in principal amount of the then outstanding Debentures, 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 or interest on the Debentures or to enforce the performance of any provision of the Debentures or this Indenture.

 

The Trustee may maintain a proceeding even if it does not possess any of the Debentures or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder of Debentures 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 .

 

The Holders of a majority in principal amount of the then outstanding Debentures, by notice to the Trustee, may waive an existing Default or Event of Default and its consequences except a continuing Default or Event of Default in the payment of the principal of or interest on the Debentures.

 

Section 6.5. Control by Majority .

 

The Holders of a majority in principal amount of the then outstanding Debentures may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture, is unduly prejudicial to the rights of other Holders of the Debentures, or would involve the Trustee in personal liability.

 

Section 6.6. Limitation on Suits .

 

The Holder of Debentures may pursue a remedy with respect to this Indenture or the Debentures only if:

 

(1)

the Holder gives to the Trustee notice of a continuing Event of Default;

 

(2)

the Holders of at least 25% in principal amount of the then outstanding Debentures make a request to the Trustee to pursue the remedy;

 

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(3)

such Holder or Holders offer to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense;

 

(4)

the Trustee does not comply with the request within sixty (60) days after receipt of the request and the offer of indemnity; and

 

(5)

during such sixty (60)-day period the Holders of a majority of principal amount of the then outstanding Debentures do not give the Trustee a direct