Exhibit 4.2
SUBORDINATED DEMAND
NOTE
, 200
Bainbridge, Georgia
No.
Subject to the restrictions in
Section 4 below, on demand, for value received, THE MONEY TREE
INC. (the “Company”) promises to pay
at the home office of the Company, 114 South Broad Street,
Bainbridge, Georgia, 39817, the principal amount of this
Subordinated Demand Note (“Demand Note”), as
represented from time to time on the books and records of the
Company, and to pay interest thereon at the initial rate of
% per annum, compounded daily. The
interest rate payable on this Demand Note is a variable rate. The
Company will establish, in its discretion, from time to time,
separate interest rates for Demand Notes with a daily balance
ranging from $1.00 to $9,999.99; $10,000.00 to $49,999.99;
$50,000.00 to $99,999.99; and $100,000.00 and over. When an
interest rate is established for each range of balances, it becomes
effective for and applied to all Notes with a daily balance within
that range, whether the Demand Note is existing or newly issued.
These interest rates may be the same or different for each range of
balances and the Company may increase or decrease the rate for any
range independently of the others without notice to holders after
the date of purchase. The interest rate on a Demand Note may also
change if the daily balance of the Demand Note changes to a
different range of balances. Interest on this Demand Note will be
paid only when the holder makes a demand for payment of the
principal of this Demand Note.
This Demand Note is one of a duly
authorized issue of Subordinated Demand Notes of the Company issued
under and subject in all respects to the terms of an Indenture
dated as of April 27, 2005 (the “Indenture”),
between the Company and U.S. Bank National Association, as trustee
(the “Trustee”). Reference is hereby made to the
Indenture and all supplemental indentures for a statement of the
respective rights of the Company, the Trustee, the agents of the
Company and the Trustee and the holders of the Debentures. All
capitalized terms used, but not defined, in this Demand Note have
the meanings assigned to them in the Indenture. No reference herein
to the Indenture and no provision of this Demand Note or of the
Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of and
interest on this Demand Note in the manner herein
prescribed.
1. Interest Rate Adjustment .
The holder will not be notified of changes from time to time in the
interest rates; the interest rates currently being paid on the
Demand Notes may be obtained at any time from the Company’s
executive office in Bainbridge, Georgia or by visiting the
Company’s website at www.themoneytreeinc.com
.
2. Redemption . The Company
can call this Demand Note for redemption at any time without
penalty subject to the subordination provisions contained in
Section 4 below and pursuant to procedures set forth in
Article 3 of the Indenture, for a redemption price equal to
the principal amount plus any unpaid interest thereon to the date
of redemption. Notice of redemption shall be given by mail to the
holder of this Demand Note at his last address as it appears on the
records of the Company not less than 30 nor more than 60 days prior
to the date fixed for redemption. Once notice of redemption is
mailed, Demand Notes called for redemption become due and payable
on the date of redemption set forth in the notice of redemption at
the redemption price. On or before the redemption date, the Company
shall set aside money sufficient to pay the redemption price of all
Demand Notes to be redeemed on that date. If the Company has mailed
a notice of redemption to the registered holder and this Demand
Note is not presented for redemption within 60 days of the
redemption date or such longer period set forth in the notice of
redemption, then the Company may transfer the money distributable
upon redemption to a separate bank account, for the benefit of the
registered holders whose Demand Notes are redeemed, and thereupon
this Demand Note shall be deemed as of the date of redemption to
have been redeemed and no longer outstanding.
3. Redemption if Balance Falls
Below $100 . The Company may, in its sole discretion, redeem
any Demand Note in full if the principal balance of such Demand
Note falls below $100 at any time. The redemption price shall be
equal to 100% of the principal amount of the Demand Note plus
accrued interest on a daily basis to the redemption date. This
redemption right of the Company is automatic and no advance notice
is required.
4. Subordination . This
Demand Note is subordinated, in all rights to payment and in all
other respects, to Senior Debt, which means all Debt (present or
future) created, incurred, assumed or guaranteed by the Company
(and all renewals, extensions or refundings thereof), except such
Debt that by its terms expressly provides that such Debt is not
senior or superior in right of payment to the Demand Notes. Senior
Debt shall include without limitation (i) the guarantee by the
Company o
