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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
DATE OF REPORT: AUGUST 20, 1997
(Date of earliest event reported)
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
<TABLE>
<S><C>
MICHIGAN COMMISSION FILE NO. 333-2522-01 38-3144240
(State of Organization) (IRS Employer I.D. No.)
</TABLE>
31700 MIDDLEBELT ROAD
SUITE 145
FARMINGTON HILLS, MICHIGAN 48334
(Address of principal executive offices)
(248) 932-3100
(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS.
On August 20, 1997, Sun Communities Operating Limited Partnership, a
Michigan limited partnership (the "Issuer"), established a program for the
issuance from time to time of up to $100,000,000 aggregate principal amount of
the Issuer's Medium-Term Notes Due Nine Months or More from Date of Issue (the
"Notes"). Any issuance of the Notes will be pursuant to the registration
statements on Form S-3 of the Issuer and Sun Communities, Inc., a Maryland
corporation (Registration Numbers 33-95694, 333-1822, 333-2522, and 333-14595)
(the "Registration Statements"), and the related Prospectus, dated October 30,
1996, and Prospectus Supplement, dated August 20, 1997.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) The following exhibits are filed as part of this Report and as part of
the Registration Statements:
1.1 Distribution Agreement, dated August 20, 1997,
among the Issuer, Sun Communities, Inc., a Maryland
corporation, and Lehman Brothers Inc. regarding the Notes
4.1 Indenture, dated as of April 24, 1996, among the
Issuer, Sun Communities, Inc., a Maryland corporation, and
Bankers Trust Company, as Trustee (incorporated by reference to
the Current Report of Sun Communities, Inc. on Form 8-K dated
April 24, 1996)
4.2 First Supplemental Indenture, dated as of August
20, 1997, among the Issuer, Sun Communities, Inc., a Maryland
corporation, and Bankers Trust Company, as Trustee
4.3 Form of Fixed-Rate Note
4.4 Form of Floating-Rate Note
5.1 Opinion of Jaffe, Raitt, Heuer &Weiss, Professional
Corporation, special counsel to the Issuer, as to the legality
of the Notes
8.1 Opinion of Jaffe, Raitt, Heuer &Weiss, Professional
Corporation, special counsel to the Issuer, as to certain
federal tax matters
25.1 Statement of Eligibility of Trustee on Form T-1
(incorporated by reference to the Registration Statement on Form
S-3 filed by the Issuer and Sun Communities, Inc. (File No.
333-2522))
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
a Michigan limited partnership
By: Sun Communities, Inc., a Maryland corporation
Its: General Partner
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<S><C>
Date: August 20, 1997 By: /s/ Jeffrey P. Jorissen
------------------------------
Jeffrey P. Jorissen, Senior Vice President,
Treasurer, Chief Financial Officer, and Secretary
</TABLE>
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Filed
Number Description Herewith
- ------ ----------- --------
<S> <C> <C>
1.1 Distribution Agreement, dated August 20, 1997, among the X
Issuer, Sun Communities, Inc., a Maryland corporation, and
Lehman Brothers Inc. regarding the Notes
4.1 Indenture, dated as of April 24, 1996, among the Issuer, Sun
Communities, Inc., a Maryland corporation, and Bankers Trust
Company, as Trustee (incorporated by reference to the
Current Report of Sun Communities, Inc. on Form 8-K dated
April 24, 1996)
4.2 First Supplemental Indenture, dated as of August 20, 1997, X
among the Issuer, Sun Communities, Inc., a Maryland
corporation, and Bankers Trust Company, as Trustee
4.3 Form of Fixed-Rate Note. X
4.4 Form of Floating-Rate Note. X
5.1 Opinion of Jaffe, Raitt, Heuer &Weiss, Professional X
Corporation, special counsel to the Issuer, as to the
legality of the Notes
8.1 Opinion of Jaffe, Raitt, Heuer &Weiss, Professional X
Corporation, special counsel to the Issuer, as to certain
federal tax matters
5.12 Statement of Eligibility of Trustee on Form T-1
(incorporated by reference to the Registration Statement on
Form S-3 filed by the Issuer and Sun Communities, Inc. (File
No. 333-2522))
</TABLE>
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EXHIBIT 1.1
U.S. $100,000,0001
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
MEDIUM-TERM NOTES
DISTRIBUTION AGREEMENT
August 20, 1997
Lehman Brothers
Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285
Ladies and Gentlemen:
Sun Communities Operating Limited Partnership, a Michigan limited
partnership (the "Company"), confirms its agreement with you (the "Agent") with
respect to the issuance and sale by the Company of up to an aggregate of
$100,000,000* in gross proceeds of its Medium-Term Notes Due Nine Months or
More from Date of Issuance (the "Notes"). The Notes are to be issued from time
to time pursuant to an indenture, dated as of April 24, 1996 (as it may be
supplemented or amended from time to time, the "Indenture"), between the
Company, Sun Communities, Inc. ("Sun"), the general partner of the Company,
and Bankers Trust Company, as trustee (the "Trustee").
The Notes shall have the maturity ranges, applicable interest rates or
interest rate formulas, specified currency, issue price, redemption and
repayment provisions and other terms set forth in the Prospectus referred to in
Section 1(a) as it may be amended or supplemented from time to time, including
any supplement providing for the interest rate, maturity and other terms of any
Note (a "Pricing Supplement"). The Notes will be issued, and the terms thereof
established, from time to time, by the Company in accordance with the Indenture
and the Procedures referred to below. This Agreement shall only apply to sales
of the Notes and not to sales of any other securities or evidences of
indebtedness of the Company and only on the specific terms set forth herein.
Subject to the terms and conditions stated herein and to the
reservation by the Company of the right to sell its Notes directly on its own
behalf, the Company hereby (i) appoints the Agent as the agent of the Company
for the purpose of soliciting and receiving offers to purchase Notes from the
Company and (ii) agrees that whenever the Company determines to sell Notes
directly to the Agent as principal it will enter into a separate agreement
(each a "Purchase Agreement"). Each such Purchase Agreement, whether oral (and
confirmed in writing, which may be by facsimile transmission) or in writing,
shall be with respect to such information (as applicable) as specified in
Exhibit C hereto, relating to such sale in accordance with Section 2(e) hereof.
Section 1. REPRESENTATIONS AND WARRANTIES.
The Company and Sun jointly and severally represent and warrant to the
Agent as of the date hereof, as of the Closing Date (defined herein) and as of
the times referred to in Sections 6(a) and 6(b) hereof (the Closing Date and
each such time being hereinafter sometimes referred to as a "Representation
Date"), as follows:
____________________
* Or the U.S. dollar equivalent in certain specified foreign
currencies or currency units.
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(a) General. Four registration statements on Form S-3 with
respect to, among other things, the Notes have been prepared and filed by Sun
and the Company in conformity with the requirements of the Securities Act of
1933, as amended (the "Act"), and the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission")
thereunder, and have become effective under the Act. The Indenture has been
qualified under the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"). As used in this Agreement, (i) "Registration Statement" means
such registration statements when they became effective under the Act, and as
from time to time amended or supplemented thereafter (if any post-effective
amendment to any such registration statement has been filed with the Commission
prior to the execution and delivery of this Agreement, the time the most recent
such amendment has been declared effective by the Commission); (ii) "Basic
Prospectus" means the most recently filed prospectus (including all documents
incorporated therein by reference) included in the Registration Statement; and
(iii) "Prospectus" means the Basic Prospectus (together with all documents
incorporated therein by reference) and any amendments or supplements thereto
(including the applicable Pricing Supplement) relating to the Notes, as filed
with the Commission pursuant to paragraph (b) of Rule 424 of the Rules and
Regulations. The Commission has not issued any order preventing or suspending
the use of the Prospectus. Any reference in this Agreement to amending or
supplementing the Prospectus shall be deemed to include the filing of materials
incorporated by reference in the Prospectus after the Closing Date (defined
herein) and any reference in this Agreement to any amendment or supplement to
the Prospectus shall be deemed to include any such materials incorporated by
reference in the Prospectus after the Closing Date (defined herein).
(b) Registration Statement, Prospectus and Indenture: Contents.
The Registration Statement and each Prospectus conformed, and the Registration
Statement and each Prospectus will conform as of the applicable Representation
Date and at all times during each period during which, in the opinion of
counsel for the Agents, a prospectus relating to the Notes is required to be
delivered under the Act (each a "Marketing Period"), in all respects to the
requirements of the Act, the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the Trust Indenture Act, and the rules and regulations of the
Commission under such Acts; the Indenture, including any amendments and
supplements thereto, conforms with the requirements of the Trust Indenture Act
and the rules and regulations of the Commission thereunder; and the
Registration Statement and each Prospectus do not, in the light of the
circumstances under which they were made, and will not as of the applicable
Representation Date and at all times during each Marketing Period, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading; provided, however, that no representation or warranty is made as to
information contained in or omitted from the Registration Statement or any
Prospectus in reliance upon and in conformity with written information
furnished to Sun or the Company by the Agent specifically for inclusion therein
or to any statements in or omissions from the statement of eligibility and
qualification on Form T-1 (the "Form T-1") of the Trustee under the Trust
Indenture Act.
(c) No Defaults; Regulatory Approvals. None of Sun, the Company
and the Company's subsidiaries (as defined in Rule 405 of the Rules and
Regulations, and hereafter called the "Subsidiaries") is in violation of its
certificate of limited partnership, partnership agreement, corporate charter or
by-laws or in default under any agreement, indenture or instrument, the effect
of which violation or default would be material to Sun, the Company or the
Company and the Subsidiaries taken as a whole; the execution, delivery and
performance of this Agreement, the Indenture, the Notes and the Purchase
Agreement, if any, by Sun and the Company and compliance by the Company with
the provisions of the Notes and the Indenture have been duly authorized by all
necessary corporate action and will not conflict with, result in the creation
or imposition of any lien, charge or encumbrance upon any of the assets of Sun,
the Company or any of the Subsidiaries pursuant to the terms of, or constitute
a default under, any agreement, indenture or instrument, or result in a
violation of the corporate charter or by-laws of Sun, the Company or any of the
Subsidiaries or any order, rule or
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3
regulation of any court or governmental agency having jurisdiction over Sun,
the Company, any of the Subsidiaries or their respective properties; and except
as required by the Act, the Trust Indenture Act, the Exchange Act and
applicable state securities laws, no consent, authorization or order of, or
filing or registration with, any court or governmental agency is required for
the execution, delivery and performance of the transactions contemplated by
this Agreement, the Notes, the Purchase Agreement, if any, or the Indenture.
(d) Material Changes or Material Transactions. Except as
described in the Registration Statement and each Prospectus, (i) there has not
been any material adverse change in, or any adverse development which
materially affects, the business, properties, condition (financial or other),
results of operations or prospects of Sun, the Company or the Company and the
Subsidiaries taken as a whole, and (ii) there has been no material transaction
entered into by Sun, the Company or any of the Subsidiaries other than those in
the ordinary course of business.
(e) Accountants. Coopers & Lybrand L.L.P., whose report appears
in the Company's most recent Annual Report on Form 10-K, which is incorporated
by reference in each Prospectus, are independent public accountants with
respect to the Company as required by the Act and the Rules and Regulations.
(f) Validity of the Indenture and the Notes. (i) The Indenture
has been duly authorized, executed and delivered by Sun and the Company and
constitutes the valid and legally binding obligation of Sun and the Company,
respectively, enforceable against Sun and the Company, respectively, in
accordance with its terms; (ii) the Notes have been validly authorized for
issuance and sale pursuant to this Agreement and, when the terms of the Notes
and of their issue and sale have been duly established in accordance with the
Indenture and this Agreement so as not to violate any applicable law or
agreement or instrument then binding on the Company, and the Notes have been
duly executed, authenticated, delivered and paid therefor as provided in this
Agreement and the Indenture, the Notes will be validly issued and outstanding,
and will constitute valid and legally binding obligations of the Company
entitled to the benefits of the Indenture and enforceable in accordance with
their terms and the terms of the Indenture; and (iii) the Notes will conform
and the Indenture conforms to the descriptions thereof contained in each
Prospectus. The validity, enforceability and legally binding nature of the
Indenture and the Notes are subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law), and except as enforceability thereof may be
limited by (A) requirements that a claim with respect to any Notes payable
other than in U.S. dollars (or a foreign currency or composite currency
judgment in respect of such claim) be converted into U.S. dollars at a rate of
exchange prevailing on a date determined pursuant to applicable law or (B)
governmental authority to limit, delay or prohibit the making of payments
outside the United States.
(g) Due Incorporation and Qualification. Each of Sun, the Company
and Sun Communities Finance Limited Partnership (the "Principal Subsidiary")
has been duly incorporated, formed or organized, is validly existing and in
good standing under the laws of its respective jurisdiction of incorporation,
formation or organization, is duly qualified to do business and in good
standing as a foreign corporation, limited partnership or limited liability
company in each jurisdiction in which its respective ownership of properties or
the conduct of its respective businesses requires such qualification (except
where the failure to obtain such qualification would not have a material
adverse effect on Sun or on the Company and the Subsidiaries taken as a whole),
and has the power and authority necessary to own or hold its respective
properties and to conduct the businesses in which it is engaged, as described
in each Prospectus. The Principal Subsidiary is the only Subsidiary that may
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4
constitute a "Significant Subsidiary" of the Company, as that term is defined
in Rule 1-02 of Regulation S-X of the Commission.
(h) Ownership of Property. The Company and each of the
Subsidiaries, and any partnership or joint venture in which such party is a
participant (a "Related Entity") have good and marketable title in fee simple
to all real property and good and marketable title to all personal property
owned by them, in each case free and clear of all liens, encumbrances and
defects except such as are described in the Prospectus or as set forth in title
insurance policies or such as do not materially affect the value of such
property and do not materially interfere with the use made and proposed to be
made of such property by the Company, the Subsidiaries and the Related Entities
and except liens and encumbrances arising as a result of debt described in the
Prospectus; (ii) all real property and buildings held under lease by the
Company, any of the Subsidiaries and the Related Entities are held by them
under valid, subsisting and enforceable leases, with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company, the Subsidiaries and the Related
Entities; (iii) all liens, charges, encumbrances, claims or restrictions on or
affecting the properties and assets of any of the Company, the Subsidiaries or
the Related Entities which are required to be disclosed in the Prospectus are
disclosed therein; (iv) none of the Company, the Subsidiaries and the Related
Entities are in default under any of the leases pursuant to which any of the
Company, the Subsidiaries or the Related Entities leases its properties and
none of the Company, the Subsidiaries and the Related Entities know of any
event which, but for the passage of time or the giving of notice, or both,
would constitute a default under any of such leases; (v) no tenant under any of
the leases pursuant to which any of the Company, the Subsidiaries or the
Related Entities leases its properties has an option or right of first refusal
to purchase the premises demised under such lease; (vi) each of the properties
of the Company, the Subsidiaries and the Related Entities complies with all
applicable codes and zoning laws and regulations, except for such failures to
comply which would not individually or in the aggregate have a material adverse
effect on the consolidated financial position, partners' capital, results of
operations, business or prospects of the Company and the Subsidiaries; and
(vii) except as previously disclosed to the Agent or its counsel, none of the
Company, the Subsidiaries and the Related Entities have knowledge of any
pending or threatened condemnation, zoning change or other proceeding or action
that will in any manner affect the size of, use of, improvements on,
construction on or access to the properties of any of the Company, the
Subsidiaries or the Related Entities.
(i) Legal Proceedings. Except as described in each Prospectus,
there is no material litigation or governmental proceeding pending or, to the
knowledge of Sun and the Company, threatened against Sun, the Company or any of
the Subsidiaries which might result in any material adverse change in the
condition (financial or other), results of operations, business, property, or
prospects of Sun, the Company or the Company and the Subsidiaries taken as a
whole or which is required to be disclosed in the Registration Statement.
(j) Financial Statements. The audited financial statements
included or incorporated by reference in each Prospectus present and will
present as of the applicable Representation Date and at all times during each
Marketing Period, fairly, the financial condition and results of operations of
the entities purported to be shown thereby in conformity with generally
accepted accounting principles, at the dates and for the periods indicated, and
have been, and will be as of the applicable Representation Date and at all
times during each Marketing Period, prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout the
period or periods involved; and the supporting schedules included or
incorporated by reference in each Prospectus present, and will present as of
the applicable Representation Date and at all times during each Marketing
Period, fairly the information required to be stated therein. The unaudited
financial statements of the Company, if any, and the related notes, included or
incorporated by reference in each Prospectus present fairly and will present
fairly at all times during each period specified in Section 3(c) hereof the
financial position
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5
of the Company at the dates and for the periods indicated in conformity with
generally accepted accounting principles (except for the absence of notes)
applied on a consistent basis throughout the periods shown, subject to normally
recurring changes resulting from year-end audit adjustments, and prepared in
accordance with the instructions to Form 10-Q.
(k) Documents Incorporated by Reference. The documents
incorporated by reference into any Prospectus have been, and will be as of the
applicable Representation Date and at all times during each Marketing Period,
prepared in conformity with the applicable requirements of the Act and the
Rules and Regulations and the Exchange Act and the rules and regulations of the
Commission thereunder; and none of such documents contained, in the light of
the circumstances under which they were made, or will contain as of the
applicable Representation Date and at all times during each Marketing Period,
an untrue statement of a material fact or omitted, in the light of the
circumstances under which they were made, or will omit, to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading; and such documents have been, or will be, as of the applicable
Representation Date and at all times during each Marketing Period, timely filed
as required thereby.
(l) Exhibits to Registration Statement. There are no contracts or
other documents which are required to be filed as exhibits to the Registration
Statement by the Act or by the Rules and Regulations, or which were required to
be filed as exhibits to any document incorporated by reference in any
Prospectus by the Exchange Act or the rules and regulations of the Commission
thereunder, which have not been filed as exhibits to the Registration Statement
or to such document or incorporated therein by reference as permitted by the
Rules and Regulations or the rules and regulations of the Commission under the
Exchange Act, as the case may be.
(m) Licenses, Approvals and Consents. Each of Sun, the Company
and the Principal Subsidiary has all licenses, approvals and consents for the
conduct of its respective business the failure of which to have would have a
material adverse effect on the business, properties, financial condition or
results of operations of Sun, the Company or the Company and the Subsidiaries
taken as a whole.
(n) Investment Company Act. The Company is not required to
register under the provisions of the Investment Company Act of 1940, as amended
(the "Investment Company Act"), and no action need be taken with respect to or
under the Investment Company Act by reason of the issuance of the Notes by the
Company.
(o) Rating. The Notes have been rated by a "nationally recognized
statistical rating agency" (as that term is defined by the Commission for
purposes of Rule 436(g)(2) of the Rules and Regulations), including one or both
of Moody's Investor Services, Inc. and Standard & Poor's Corporation.
(p) [Reserved].
(q) True and Complete Documents. The certificates delivered
pursuant to paragraph (f) of Section 5 hereof and all other documents delivered
by Sun, the Company or representatives thereof in connection with the issuance
and sale of the Notes were on the dates on which they were delivered, or will
be on the dates on which they are to be delivered, true and complete in all
material respects.
(r) Partnership Interests. All of the partnership interests of
the Company, the Principal Subsidiary and the partnership Subsidiaries have
been duly authorized and validly issued, are fully
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6
paid and, except as described in the Prospectus, are owned by Sun or the
Company free and clear of all mortgages, pledges, liens, claims or
encumbrances.
(s) Validity of this Agreement. This Agreement has been duly
authorized, executed and delivered by Sun and the Company and constitutes the
valid and legally binding obligation of Sun and the Company, respectively,
enforceable against Sun and the Company, respectively, in accordance with its
terms. The validity, enforceability and legally binding nature of this
Agreement are subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(t) Insurance. The Company and each of the Subsidiaries carry, or
are covered by, insurance in such amounts and covering such risks as is
adequate for the conduct of their respective businesses and the value of their
respective properties and as is customary for companies engaged in similar
businesses in similar industries.
(u) Intellectual Property. The Company and each of the
Subsidiaries own or possess adequate rights to use all material patents, patent
applications, trademarks, service marks, trade names, trademark registrations,
service mark registrations, copyrights and licenses necessary for the conduct
of their respective businesses and have no reason to believe that the conduct
of their respective businesses will conflict with, and have not received any
notice of any claim of conflict with, any such rights of others.
(v) Insider Relationships. No relationship, direct or indirect,
exists between or among Sun or the Company on the one hand, and the directors,
officers or stockholders of Sun on the other hand, that is required to be
described in the Prospectus and is not so described.
(w) Labor Matters. No labor disturbance by the employees of Sun
or the Company exists or, to the knowledge of Sun or the Company is imminent
which might be expected to have a material adverse effect on the consolidated
financial position, partners' capital, results of operations, business or
prospects of the Company and the Subsidiaries.
(x) ERISA. The Company is in compliance in all material respects
with all presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"); no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in ERISA)
for which the Company would have any liability; the Company has not incurred
and does not expect to incur liability under (i) Title IV of ERISA with respect
to termination of, or withdrawal from, any "pension plan" or (ii) Sections 412
or 4971 of the Internal Revenue Code of 1986, as amended, including the
regulations and published interpretations thereunder (the "Code"); and each
"pension plan" for which the Company would have any liability that is intended
to be qualified under Section 401(a) of the Code is so qualified in all
material respects and nothing has occurred, whether by action or by failure to
act, which would cause the loss of such qualification.
(y) Tax Returns. Each of Sun and the Company has filed all
federal, state and local income and franchise tax returns required to be filed
through the date hereof or obtained extensions for such filings, and has paid
all taxes due thereon, and no tax deficiency has been determined adversely to
Sun, the Company or any of their subsidiaries, which has had (nor does Sun or
the Company have any knowledge of any tax deficiency which, if determined
adversely to Sun, the Company or any of their subsidiaries, might have) a
material adverse effect on the consolidated
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financial condition, stockholders' equity, partners' capital, results of
operations, business or prospects of Sun, the Company and their subsidiaries.
(z) No Extraordinary Events. Since the date as of which
information is given in the Prospectus through the date hereof, and except as
may otherwise be disclosed in the Prospectus, neither Sun nor the Company has
(i) issued or granted any securities other than limited partnership interests
in the Company that may be issued to sellers of properties to the Company after
the date of this Agreement, (ii) incurred any liability or obligation, direct
or contingent, other than liabilities and obligations which were incurred in
the ordinary course of business, (iii) entered into any transaction not in the
ordinary course of business or (iv) declared or paid any dividend or
distribution on its capital stock or partnership interests other than ordinary
quarterly Sun dividends and Company distributions after the date of this
Agreement.
(aa) Books and Records. Each of Sun and the Company (i) makes and
keeps accurate books and records and (ii) maintains internal accounting
controls which provide reasonable assurance that (A) transactions are executed
in accordance with management's authorization, (B) transactions are recorded as
necessary to permit preparation of its financial statements and to maintain
accountability for its assets, (C) access to its assets is permitted only in
accordance with management's authorization and (D) the reported accountability
for its assets is compared with existing assets at reasonable intervals.
(ab) Foreign Corrupt Practices Act. None of Sun, the Company and
their respective subsidiaries, and none of the directors, officers, agents,
employees or other persons associated with or acting on behalf of Sun, the
Company or any of their subsidiaries, has used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expense relating
to political activity; made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from corporate funds;
violated or is in violation of any provision of the Foreign Corrupt Practices
Act of 1977; or made any bribe, rebate, payoff, influence payment, kickback or
other unlawful payment.
(ac) Environmental Matters. Except as disclosed in the
environmental reports previously furnished to the Agent, there has been no
storage, disposal, generation, manufacture, refinement, transportation,
handling or treatment of any material by the Company or any of the Subsidiaries
or, to the Company's knowledge, any of their respective predecessors in
interest at, upon or from any property now or previously owned or leased by the
Company or the Subsidiaries or any of their predecessors in interest in
violation of any applicable law, ordinance, rule, regulation, order, judgment,
decree or permit or which would require remedial action damages or the
modification or cessation of any activity of the Company or any of the
Subsidiaries under any applicable law, common law, ordinance, rule, regulation,
order, judgment, decree or permit, except for any violation, remedial action,
damages, modification or cessation which would not have, singly or in the
aggregate with all such violations, remedial actions, damages, modifications or
cessations, a material adverse effect on the general affairs, management,
financial position, partners' capital or results of operations of the Company
and the Subsidiaries; there has been no material spill, discharge, leak,
emission, injection, escape, dumping, migration or release of any kind onto any
of the Properties (as defined in the Prospectus) or into the environment
surrounding any such property except for any such spill, discharge, leak,
emission, injection, escape, dumping or release which would not have, singly or
in the aggregate with all such spills, discharges, leaks, emissions,
injections, escapes, dumpings and releases, a material adverse effect on the
general affairs, management, financial position, partners' capital or results
of operations of the Company and the Subsidiaries.
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(ad) REIT Status. The Company is not an association taxable as a
corporation within the meaning of the Code and its income is not subject to tax
at the partnership level under the Code. Sun is organized in conformity with
the requirements for qualification as a real estate investment trust under the
Code, and its present and contemplated method of operation does and will enable
it to meet the requirements for taxation as a real estate investment trust
("REIT") under the Code and Sun has elected to be taxed as a REIT under the
Code commencing with the year ended December 31, 1994.
(ae) Insurance. Each of the Company and the Subsidiaries has title
insurance on all real property described in the Prospectus as owned or to be
owned by such party in an amount at least equal to the cost of acquisition of
such property.
(af) Validity of Partnership Agreements. Each partnership
agreement to which the Company or any of the Subsidiaries is a party, and which
relates to real property described in the Prospectus, has been duly authorized,
executed and delivered by such applicable party and constitutes the valid
agreement thereof, enforceable in accordance with its terms. The validity and
enforceability of such partnership agreements are subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally and
general equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law). The execution, delivery and
performance of any of such agreements did not, at the time of execution and
delivery, and does not constitute a breach of, or a default under, the charter,
partnership agreement or by-laws of the Company or the Subsidiaries or any
material contract, lease or other instrument to which the Company or any of the
Subsidiaries is a party or to which any of their property may be bound or any
law, administrative regulation or administrative or court decree.
Section 2. SOLICITATIONS AS AGENT; PURCHASES AS PRINCIPAL
(a) Appointment. Subject to the terms and conditions stated
herein, and subject to the reservation by the Company of the right to sell
Notes directly on its own behalf and through or to other dealers or agents, the
Company hereby appoints the Agent as an agent of the Company for the purpose of
soliciting or receiving offers to purchase the Notes from the Company by
others. The Company may from time to time offer Notes for sale otherwise than
through the Agent; provided, however, that so long as this Agreement shall be
in effect the Company shall not solicit offers to purchase Notes through any
other agent without amending this Agreement to appoint such agent as an
additional Agent hereunder on the same terms and conditions as provided herein
for the Agent and without giving Agent prior notice of such appointment. The
consent of the then-current Agents shall not be necessary for such purpose. In
the absence of such an amendment, the Company may accept offers to purchase
Notes from or through an agent other than the Agent, provided that (i) the
Company shall not have solicited such offers, (ii) the Company and such agent
shall have executed an agreement with respect to such purchases having terms
and conditions (including, without limitation, commission rates) with respect
to such purchases substantially the same as the terms and conditions that would
apply to such purchases under this Agreement if such agent was an Agent (which
may be accomplished by incorporating by reference in such agreement the terms
and conditions of this Agreement), and (iii) the Company shall provide the
Agent with a copy of such agreement following the execution thereof. On the
basis of the representations and warranties contained herein, but subject to
the terms and conditions herein set forth, the Agent agrees, as an agent of the
Company, to use its reasonable efforts to solicit offers to purchase the Notes
upon the terms and conditions set forth in the Prospectus. Except as otherwise
provided herein, so long as this Agreement shall remain in effect, the Company
shall not, without the consent of the Agent, solicit or accept offers to
purchase Notes otherwise than through the Agent provided, however, the Company
expressly reserves the right to sell Notes directly to investors, in which case
no commission will be payable with respect to any such
<PAGE> 9
9
sale. The Agent may also purchase Notes from the Company as principal for
purposes of resale, as more fully described in paragraph (e) of this Section.
(b) Suspension of Solicitation. The Company reserves the right,
in its sole discretion, to suspend solicitation of offers to purchase the Notes
commencing at any time for any period of time or indefinitely. Upon receipt of
at least one business day's prior written notice from the Company, the Agent
will forthwith suspend solicitation of offers to purchase Notes from the
Company until such time as the Company has advised the Agent that such
solicitation may be resumed. For the purpose of the foregoing sentence,
"business day" shall mean any day which is not a Saturday or Sunday and which
is not a day on which (i) banking institutions are generally authorized or
obligated by law to close in The City of New York and (ii) The New York Stock
Exchange, Inc. is closed for trading.
Upon receipt of notice from the Company as contemplated by
Section 3(c) hereof, the Agent shall suspend its solicitation of offers to
purchase Notes until such time as the Company shall have furnished it with an
amendment or supplement to the Registration Statement or the Prospectus, as the
case may be, contemplated by Section 3(c) and shall have advised the Agent that
such solicitation may be resumed.
(c) Agent's Commission. Promptly upon the closing of the sale of
any Notes sold by the Company as a result of a solicitation made by or offer to
purchase received by the Agent, the Company agrees to pay the Agent a
commission, in the form of a discount, in accordance with the schedule set
forth in Schedule A hereto.
(d) Solicitation of Offers. The Agent is authorized to solicit
offers to purchase the Notes only in denominations as are specified in the
Prospectus at a purchase price as shall be specified by the Company, in an
aggregate amount not to exceed the amount authorized by the Company from time
to time (less the aggregate amount of Notes either sold directly by the Company
or purchased from the Company by the Agent as principal). The Agent shall
communicate to the Company, orally or in writing, each reasonable offer to
purchase Notes received by it as Agent. The Company shall have the sole right
to accept offers to purchase the Notes and may reject any such offer in whole
or in part. The Agent shall have the right, in its discretion reasonably
exercised without advising the Company, to reject any offer to purchase the
Notes received by it, in whole or in part, and any such rejection shall not be
deemed a breach of its agreement contained herein.
No Note which the Company has agreed to sell pursuant to this
Agreement shall be deemed to have been purchased and paid for, or sold by the
Company, until such Note shall have been delivered to the purchaser thereof
against payment by such purchaser.
(e) Purchases as Principal. Each sale of Notes to the Agent as
principal, for resale to one or more investors or to another broker-dealer
(acting as principal for purposes of resale), shall be made in accordance with
the terms of this Agreement and a Purchase Agreement whether oral (and
confirmed in writing by such Agent to the Company, which may be by facsimile
transmission) or in writing, which will provide for the sale of such Notes to,
and the purchase thereof by, the Agent. A Purchase Agreement may also specify
certain provisions relating to the reoffering of such Notes by the Agent. The
commitment of the Agent to purchase Notes from the Company as principal shall
be deemed to have been made on the basis of the representations and warranties
of the Company herein contained and shall be subject to the terms and
conditions herein set forth. Each Purchase Agreement shall contain, to the
extent applicable, those terms specified in Exhibit A hereto, including the
time and date (each such time and date being referred to herein as a "Time of
Delivery") and place of delivery of and payment for such Notes and such other
information (as applicable) as is set forth in Exhibit C hereto. The Company
agrees that if the Agent purchases Notes as principal for resale such Agent
shall receive such compensation, in the form of a discount or otherwise, as
shall be indicated in
<PAGE> 10
10
the applicable Purchase Agreement or, if no compensation is indicated therein,
a commission in accordance with Schedule A hereto. The Agent may utilize a
selling or dealer group in connection with the resale of such Notes. In
addition, the Agent may offer the Notes they have purchased as principal to
other dealers. The Agent may sell Notes to any dealer at a discount and,
unless otherwise specified in the applicable Pricing Supplement, such discount
allowed to any dealer will not be in excess of 66 2/3% of the discount to be
received by such Agent from the Company. Such Purchase Agreement shall also
specify any requirements for delivery of opinions of counsel, accountant's
letters and officers' certificates pursuant to Section 5 hereof.
(f) Administrative Procedures. The purchase price, interest rate
or formula, maturity date and other terms of the Notes (as applicable)
specified in Exhibit A hereto shall be agreed upon by Sun, the Company and the
Agent and specified in a Pricing Supplement to be prepared in connection with
each sale of Notes. Administrative procedures respecting the sale of Notes
(the "Procedures") are set forth in Exhibit B hereto and may be amended in
writing from time to time by the Agent and the Company. The Agent and the
Company agree to perform the respective duties and obligations specifically
provided to be performed by each of them herein and in the Procedures. The
Procedures shall apply to all transactions contemplated hereunder including
sales of Notes to the Agent as principal pursuant to a Purchase Agreement,
unless otherwise set forth in such Purchase Agreement.
(g) Delivery of Documents. The documents required to be delivered
by Section 5 hereof shall be delivered at the offices of Skadden, Arps, Slate,
Meagher & Flom LLP, 919 Third Avenue, New York, New York 10022, not later than
10:00 A.M., New York City time, on the date of this Agreement or at such later
time as may be mutually agreed upon by the Company and the Agent, which in no
event shall be later than the time at which the Agent commences solicitation of
offers to purchase Notes hereunder (the "Closing Date").
Section 3. COVENANTS OF THE COMPANY
The Company covenants and agrees:
(a) Delivery of Signed Registration Statement. To furnish
promptly to the Agent and to its counsel a signed copy of the Registration
Statement as originally filed and each amendment or supplement thereto.
(b) Delivery of Other Documents. To deliver promptly to the
Agent, and in such number as it may request, each of the following documents:
(i) conformed copies of the Registration Statement (excluding exhibits other
than the computation of the ratio of earnings to fixed charges, the Indenture,
this Agreement and such other exhibits that the Agent may request), (ii) the
Basic Prospectus, (iii) each Prospectus and (iv) during any Marketing Period,
any documents incorporated by reference in the Prospectus.
(c) Revisions to Prospectus - Material Changes. If, during any
Marketing Period, any event occurs as a result of which the Prospectus would
include an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein, not misleading, or if it is
necessary at any time to amend any Prospectus to comply with the Act, to notify
the Agent promptly, in writing, to suspend solicitation of purchases of the
Notes; and if the Company shall decide to amend or supplement the Registration
Statement or any Prospectus, to promptly advise the Agent by telephone (with
confirmation in writing) and to promptly, in writing, prepare and file with the
Commission an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance; provided, however,
that if during the period referred to above the Agent shall own any Notes which
it has purchased from the Company as principal with
<PAGE> 11
11
the intention of reselling them, the Company shall promptly prepare and timely
file with the Commission any amendment or supplement to the Registration
Statement or any Prospectus that may, in the judgment of the Company or the
Agent, be required by the Act or requested by the Commission.
(d) Commission Filings. To timely file with the Commission during
any Marketing Period, all documents (and any amendments to previously filed
documents) required to be filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act.
(e) Copies of Filings with Commission. Prior to filing with the
Commission during any Marketing Period, (i) any amendment or supplement to the
Registration Statement, (ii) any amendment or supplement to any Prospectus or
(iii) any document incorporated by reference in any of the foregoing or any
amendment of or supplement to any such incorporated document, to furnish a copy
thereof to the Agent.
(f) Notice to Agent of Certain Events. To advise the Agent
immediately (i) when any post-effective amendment to the Registration Statement
relating to or covering the Notes becomes effective, (ii) of any request or
proposed request by the Commission for an amendment or supplement to the
Registration Statement, to any Prospectus, to any document incorporated by
reference in any of the foregoing or for any additional information and the
Company will afford the Agent a reasonable opportunity to comment on any such
proposed amendment or supplement, (iii) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement or
any part thereof or any order directed to any Prospectus or any document
incorporated therein by reference or the initiation or threat of any stop order
proceeding or of any challenge to the accuracy or adequacy of any document
incorporated by reference in any Prospectus, (iv) of receipt by the Company of
any notification with respect to the suspension of the qualification of the
Notes for sale in any jurisdiction or the initiation or threat of any
proceeding for that purpose, (v) of any downgrading in the rating of the Notes
or any other debt securities of the Company, or any proposal to downgrade the
rating of the Notes or any other debt securities of the Company, by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) of the Rules and Regulations), or any public
announcement that any such organization has under surveillance or review its
rating of any debt securities of the Company (other than an announcement with
positive implications of a possible upgrading, and no implication of a possible
downgrading of such rating) as soon as the Company learns of any such
downgrading, proposal to downgrade or public announcement and (vi) of the
happening of any event which makes untrue any statement of a material fact made
in the Registration Statement or any Prospectus or which requires the making of
a change in the Registration Statement or any Prospectus in order to make any
material statement therein not misleading.
(g) Stop Orders. If, during any Marketing Period, the Commission
shall issue a stop order suspending the effectiveness of the Registration
Statement, to make every reasonable effort to obtain the lifting of that order
at the earliest possible time.
(h) Earnings Statements. As soon as practicable, but not later
than 18 months, after the date of each acceptance by the Company of an offer to
purchase Notes hereunder, to make generally available to its security holders
an earnings statement covering a period of at least 12 months beginning after
the later of (i) the effective date of the Registration Statement, (ii) the
effective date of the most recent post-effective amendment to the Registration
Statement to become effective prior to the date of such acceptance and (iii)
the date of the Company's most recent Annual Report on Form 10-K filed with the
Commission prior to the date of such acceptance which will satisfy the
provisions of Section 11(a) of the Act (including, at the option of the
Company, Rule 158 of the Rules and Regulations);
<PAGE> 12
12
(i) Copies of Reports, Releases and Financial Statements. So long
as any of the Notes are outstanding, to furnish to the Agent, not later than
the time the Company makes the same available to others, copies of all public
reports or releases and all reports and financial statements furnished by the
Company to any securities exchange on which the Notes are listed pursuant to
requirements of or agreements with such exchange or to the Commission pursuant
to the Exchange Act or any rule or regulation of the Commission thereunder.
(j) Blue Sky Qualifications. To endeavor, in cooperation with the
Agent, to qualify the Notes for offering and sale under the securities laws of
such jurisdictions as the Agent may designate, and to maintain such
qualifications in effect for as long as may be required for the distribution of
the Notes; and to file such statements and reports as may be required by the
laws of each jurisdiction in which the Notes have been qualified as above
provided; provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a foreign entity in
any jurisdiction in which it is not so qualified.
(k) Holdback. Between the date of a Purchase Agreement and the
date of delivery of the Notes with respect thereto, the Company will not offer
or sell, or enter into any agreement to sell, any of its debt securities, other
than borrowings under the Company's revolving credit agreements and lines of
credit, the private placement of securities and issuances of its commercial
paper.
(l) Pricing Supplement. To prepare, with respect to any Notes to
be sold through or to the Agent pursuant to this Agreement, a Pricing
Supplement with respect to such Notes in a form previously approved by the
Agent and to file such Pricing Supplement pursuant to Rule 424 of the Rules and
Regulations with the Commission.2
Section 4. PAYMENT OF EXPENSES
The Company will pay:
(i) the costs incident to the authorization, issuance,
sale and delivery of the Notes and any taxes payable in that
connection,
(ii) the costs incident to the preparation, printing and
filing under the Act of the Registration Statement and any amendments
and exhibits thereto,
(iii) the costs incident to the preparation, printing and
filing of any document and any amendments and exhibits thereto
required to be filed by the Company under the Exchange Act,
(iv) the costs of distributing the Registration Statement,
as originally filed, and each amendment and post-effective amendment
thereof (including exhibits), the Basic Prospectus, each Prospectus,
any supplement or amendment to any Prospectus and any documents
incorporated by reference in any of the foregoing documents,
____________________
* If clause (b)(3) of Rule 424 is applicable, such filing shall be
made no later than the fifth business day following the earlier
of the date of determination of the settlement information
described below or the date such Pricing Supplement is first
used. If clause (b)(2) or (b)(5) of Rule 424 is applicable, such
filing shall be made no later than the second business day
following the earlier of the date of determination of the
settlement information or the date such Pricing Supplement is first
used.
<PAGE> 13
13
(v) the fees and disbursements of the Trustee, any paying
agent, any calculation agent, any exchange rate agent and any other
agents appointed by the Company, and their respective counsel,
(vi) the costs and fees in connection with the listing of
the Notes on any securities exchange,
(vii) the cost and fees in connection with any filings with
the National Association of Securities Dealers, Inc.,
(viii) the fees and disbursements of counsel to the Company
and counsel to the Agent,
(ix) the fees paid to rating agencies in connection with
the rating of the Notes,
(x) the fees and expenses of qualifying the Notes under
the securities laws of the several jurisdictions as provided in
Section 3(j) hereof and of preparing and printing a Blue Sky
Memorandum and a memorandum concerning the legality of the Notes as an
investment (including reasonable fees and expenses of counsel for the
Agent in connection therewith),
(xi) all advertising expenses in connection with the
offering of the Notes incurred with the consent of the Company, and
(xii) all other costs and expenses arising out of the
transactions contemplated hereunder and incident to the performance of
the Company's obligations under this Agreement.
Section 5. CONDITIONS OF OBLIGATIONS OF AGENT
The obligation of the Agent, as agent of the Company, under this
Agreement to solicit offers to purchase the Notes, the obligation of any person
who has agreed to purchase Notes to make payment for and take delivery of
Notes, and the obligation of the Agent to purchase Notes pursuant to any
Purchase Agreement, is subject to the accuracy, on each Representation Date, of
the representations and warranties of Sun and the Company contained herein, to
the accuracy of the statements of Sun's and the Company's officers made in any
certificate furnished pursuant to the provisions hereof, to the performance by
Sun and the Company of their respective obligations hereunder, and to each of
the following additional terms and conditions:
(a) Registration Statement. The Prospectus as amended or
supplemented (including the Pricing Supplement) with respect to such Notes
shall have been filed with the Commission pursuant to Rule 424(b) of the Rules
and Regulations within the applicable time period prescribed for such filing by
the Rules and Regulations and in accordance with Section 3(l) hereof; no stop
order suspending the effectiveness of the Registration Statement or any part
thereof nor any order directed to any document incorporated by reference in any
Prospectus shall have been issued and no stop order proceeding shall have been
initiated or threatened by the Commission and no challenge shall have been made
to the accuracy or adequacy of any document incorporated by reference in any
Prospectus; any request of the Commission for inclusion of additional
information in the Registration Statement or any Prospectus or otherwise shall
have been complied with; and the Company shall not have filed with the
Commission any amendment or supplement to the Registration Statement or any
Prospectus (or any document incorporated by reference therein) without the
consent of the Agent.
<PAGE> 14
14
(b) No Suspension of Sale of the Notes. No order suspending the
sale of the Notes in any jurisdiction designated by the Agent pursuant to
Section 3(j) hereof shall have been issued, and no proceeding for that purpose
shall have been initiated or threatened.
(c) No Material Omissions or Untrue Statements. The Agent shall
not have discovered and disclosed to the Company that the Registration
Statement or any Prospectus contains an untrue statement of a fact which, in
the opinion of counsel for the Agent, is material or omits to state a fact
which, in the opinion of such counsel, is material and is required to be stated
therein or is necessary to make the statements therein not misleading.
(d) Legal Matters Satisfactory to Counsel. All corporate and
partnership proceedings and other legal matters incident to the authorization,
form and validity of this Agreement, the Notes, the Indenture, the form of the
Registration Statement, each Prospectus and all other legal matters relating to
this Agreement and the transactions contemplated hereby shall be satisfactory
in all respects to counsel for the Agent, and Sun and the Company shall have
furnished to such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
(e) Opinion of Company Counsel. At the Closing Date, the Agent
shall have received the opinion, addressed to the Agent and dated the Closing
Date, of Jaffe, Raitt, Heuer & Weiss, Professional Corporation, counsel to Sun
and the Company, in form and substance satisfactory to the Agent and its
counsel, to the effect that:
(i) Each of Sun, the Company and the Principal Subsidiary
has been duly incorporated or formed, as the case may be, and is
validly existing and in good standing under the laws of its respective
jurisdiction of incorporation or organization, as the case may be;
based upon the Secretary's Certificate attached thereto as Exhibit A
and certificates of good standing or qualification received from the
respective state governmental agencies, each of Sun, the Company and
the Principal Subsidiary is duly qualified to do business and in good
standing as a foreign corporation, limited partnership or limited
liability company, as the case may be, in all jurisdictions in which
its respective ownership of properties or the conduct of its
respective businesses requires such qualification (except where the
failure to so qualify would not have a material adverse effect on the
Company and the Subsidiaries taken as a whole), and has all power and
authority necessary to own its respective properties and conduct the
businesses in which it is engaged, as described in the Prospectus;
provided, however, that this opinion shall not apply with respect to
any states in which Sun, the Company or any of their subsidiaries are
required to be qualified to do business solely as a result of the sale
of the securities of the Company, Sun or their subsidiaries; all of
the issued and outstanding capital stock of each corporate Principal
Subsidiary has been duly authorized and validly issued and is fully
paid and nonassessable, and, except as set forth in the Prospectus,
all of such capital stock is owned by the Company, directly or through
Subsidiaries, free and clear of any mortgage, pledge, lien, claim or
encumbrance; and all of the partnership interests of the Company and
of each partnership Principal Subsidiary have been duly authorized and
validly issued, are fully paid and, except as set forth in the
Prospectus, are owned by Sun or the Company free and clear of all
mortgages, pledges, liens, claims or encumbrances;
(ii) Such counsel has no reason to believe that the
Registration Statement, as of its effective date, contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, or the Prospectus contains any untrue
statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the
<PAGE> 15
15
circumstances under which they were made not misleading, it being
understood that such counsel need express no opinion as to the
financial statements or other financial or statistical information
contained or incorporated therein or omitted therefrom, or the Form
T-1 that is an exhibit to the Registration Statement;
(iii) Such counsel does not know of any litigation or any
governmental proceeding pending or threatened against Sun, the Company
or any of the Subsidiaries which would affect the subject matter of
this Agreement or is required to be disclosed in the Prospectus which
is not disclosed and correctly summarized therein;
(iv) No consent, approval, authorization or order of any
court or governmental agency or body is required for the consummation
of the transactions contemplated herein except such as have been
obtained under the Act and such as may be required under the blue sky
laws of any jurisdiction in connection with the sale of the Notes as
contemplated by this Agreement and such other approvals (specified in
such opinion) as have been obtained;
(v) Such counsel does not know of any contracts or other
documents which are required to be filed as exhibits to the
Registration Statement by the Act or by the Rules and Regulations, or
which are required to be filed by the Exchange Act or the rules and
regulations of the Commission thereunder as exhibits to any document
incorporated by reference in the Prospectus, which have not been filed
as exhibits to the Registration Statement or to such document or
incorporated therein by reference as permitted by the Rules and
Regulations or the rules and regulations of the Commission under the
Exchange Act;
(vi) To the best of such counsel's knowledge, neither the
Company nor any of the Subsidiaries is in violation of its certificate
of limited partnership, partnership agreement, corporate charter or
by-laws, or in default (except where such default would not have a
material adverse effect upon the Company and the Subsidiaries taken as
a whole) under any agreement, indenture or instrument;
(vii) The Indenture has been duly authorized by Sun and the
Company, duly executed and delivered by Sun and the Company and duly
qualified under the Trust Indenture Act and is a valid and legally
binding obligation of Sun and the Company enforceable in accordance
with its terms;
(viii) The Notes are in a form contemplated by the Indenture
and have been duly authorized by all necessary partnership and
corporate action and, when the terms of the Notes and of their issue
and sale have been duly established in accordance with the Indenture
and this Agreement so as not to violate any applicable law or
agreement or instrument then binding on Sun or the Company, and when
the Notes have been duly executed and authenticated as specified in
the Indenture and delivered against payment therefor in accordance
with this Agreement, the Notes will be legal, valid and binding
obligations of the Company enforceable in accordance with their terms,
and entitled to the benefits of the Indenture;
(ix) The execution, delivery and performance of this
Agreement and the Purchase Agreement, if any, and compliance by Sun
and the Company with the provisions of the Notes and the Indenture
will not conflict with, or result in the creation or imposition of any
lien, charge or encumbrance upon any of the assets of Sun, the Company
or any of the Subsidiaries pursuant to the terms of, or constitute a
default under, any agreement, indenture or instrument known to such
counsel, or result in a violation of the certificate of limited
partnership, partnership agreement, corporate charter or by-laws of
Sun, the Company or any of the Subsidiaries (as in effect on the date
of such opinion) or any order, rule or regulation (also as
<PAGE> 16
16
in effect on the date of such opinion) of any court or governmental
agency having jurisdiction over Sun, the Company, any of the
Subsidiaries or their respective properties; and no consent,
authorization or order of, or filing or registration with, any court
or governmental agency is required for the execution, delivery and
performance by Sun and the Company of this Agreement and the Purchase
Agreement, if any, except such as may be required by the Act, the
Trust Indenture Act, the Exchange Act or state securities laws;
(x) The Notes and the Indenture conform to the statements
concerning each of them in the Registration Statement and the
Prospectus;
(xi) The Registration Statement has become effective under
the Act and, to the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceeding for that purpose is pending or threatened by
the Commission;
(xii) To the knowledge of such counsel, no order directed
to any document incorporated by reference in the Prospectus has been
issued and no challenge has been made to the accuracy or adequacy of
any such document; and they have no reason to believe that any of such
documents, when they became effective or were so filed, as the case
may be, contained, in the case of a registration statement which
became effective under the Act, an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and, in the
case of other documents which were filed under the Act or the Exchange
Act with the Commission, an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made when such documents were so filed, not misleading; it being
understood that such counsel need express no opinion as to the
financial statements or other financial or statistical information
contained or incorporated therein or omitted therefrom;
(xiii) The Registration Statement and the Prospectus (except
that no opinion need be expressed as to the financial statements and
other financial data contained therein or the Form T-1 that is an
exhibit thereto) comply as to form in all material respects with the
requirements of the Act and the Trust Indenture Act and the rules and
regulations of the Commission under said Acts; the Indenture conforms
in all material respects to the requirements of the Trust Indenture
Act and the rules and regulations of the Commission thereunder; and
the documents incorporated by reference in the Prospectus (except that
no opinion need be expressed as to the financial statements and other
financial or statistical data contained therein) comply as to form in
all material respects with the applicable requirements of the Exchange
Act and the rules and regulations of the Commission thereunder;
(xiv) The statements made in the Prospectus under the
captions "Description of Debt Securities," "Description of the Notes"
and "Special Provisions Relating to Multi-Currency Notes," insofar as
they purport to summarize the provisions of documents or agreements
specifically referred to therein, fairly present the information
called for with respect thereto by Form S-3;
(xv) Sun and the Company each has the corporate or
partnership power and authority necessary to execute and deliver this
Agreement and the Purchase Agreement, if any, and to perform its
respective obligations (including the sale and delivery by the Company
of the Notes under this Agreement); and this Agreement and the
Purchase Agreement, if any, has been duly authorized, executed and
delivered by Sun and the Company;
<PAGE> 17
17
(xvi) The Company is not required to register under the
provisions of the Investment Company Act, and no action need be taken
with respect to or under the Investment Company Act by reason of the
issuance of the Notes by the Company; and
(xvii) The descriptions contained in the Prospectus under
the heading "Federal Income Tax Considerations" and "Certain United
States Federal Income Tax Considerations," while not purporting to
discuss all possible income tax ramifications of the proposed
issuance, is correct in all material respects; and the most recently
filed opinion of such counsel filed as Exhibit 8.1 to the Registration
Statement is confirmed and the Agent may rely on such opinion as
though addressed to it;
(xviii) Each partnership agreement to which the Company or
any of the Subsidiaries is a party, and which relates to real property
described in the Prospectus, has been duly authorized, executed and
delivered by such applicable party and constitutes the valid agreement
thereof, enforceable in accordance with its terms. The execution,
delivery and performance of any of such agreements did not, at the
time of execution and delivery, and does not constitute a breach of,
or a default under, the charter, partnership agreement or by-laws of
the Company or the Subsidiaries or, except where such breach or
default would not have a material adverse effect on the Company, any
material contract, lease or other instrument to which the Company or
any of the Subsidiaries is a party or to which any of their properties
may be bound or any law, administrative regulation or administrative
or court decree.
The opinions set forth in paragraphs (vii), (viii), (ix) and
(xviii) above are subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles (regardless
of whether such enforceability is considered in a proceeding in equity or at
law), and except as enforceability thereof may be limited by (A) requirements
that a claim with respect to any Notes payable other than in U.S. dollars (or a
foreign currency or composite currency judgment in respect of such claim) be
converted into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or (B) governmental authority to limit,
delay or prohibit the making of payments outside the United States.
In rendering such opinion, such counsel may rely as to matters
of Maryland law on the opinion of Ober, Kaler Grimes & Shriver, or other
Maryland counsel approved by the Agent, such approval not to be unreasonably
withheld, delayed, or conditioned, which opinion shall be in form and substance
satisfactory to counsel for the Agent, provided that such counsel shall state
that it believes that both the Agent and it are justified in relying upon such
opinion.
(f) Officers' Certificate. Sun and the Company shall have
furnished to the Agent on the Closing Date a certificate, dated the Closing
Date, of the Chairman of the Board, the President or a Vice President and the
Chief Financial Officer of Sun stating that to the best of such officers'
knowledge:
(i) The representations, warranties and agreements of Sun
and the Company in Section 1 hereof are true and correct as of the
Closing Date; each of Sun and the Company has complied with all its
agreements contained herein; and the conditions set forth in Sections
5(a) and 5(b) hereof have been fulfilled;
(ii) No stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that
purpose is pending or threatened by the Commission;
<PAGE> 18
18
(iii) All filings required by Rule 424(b) of the Rules and
Regulations have been made; and
(iv) They have carefully examined the Registration
Statement and the Prospectus and, in their opinion, (A) the
Registration Statement, as of its effective date, did not contain any
untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the statements
therein not misleading, (B) the Prospectus does not contain any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, and (C) since the effective date of the Registration
Statement there has not occurred any event required to be set forth in
an amended or supplemented prospectus which has not been so set forth.
(g) Accountant's Letter. Sun and the Company shall have furnished
to the Agent on the Closing Date a letter of Coopers & Lybrand L.L.P.,
addressed jointly to the Company and the Agent and dated the Closing Date, of
the type described in the American Institute of Certified Public Accountants'
Statement on Auditing Standards No. 49, in form and substance reasonably
satisfactory to the Agent confirming that they are independent accountants
within the meaning of the Act and the applicable published Rules and
Regulations thereunder and stating in effect that:
(i) In their opinion, the financial statements and
schedules examined by them and included in the prospectus contained in
the Registration Statement comply in form in all material respects
with the applicable accounting requirements of the Act and the related
published Rules and Regulations;
(ii) They have made a review of any unaudited financial
statements included in the Prospectus in accordance with standards
established by the American Institute of Certified Public Accountants,
as indicated in their report or reports attached to such letter;
(iii) On the basis of the review referred to in (ii) above
and a reading of the latest available interim financial statements of
the Company, inquiries of officials of the Company who have
responsibility for financial and accounting matters and other
specified procedures, nothing came to their attention that caused them
to believe that:
(A) the unaudited financial statements, if any,
included in the Prospectus do not comply in form in all
material respects with the applicable accounting requirements
of the Act and the related published Rules and Regulations or
are not in conformity with generally accepted accounting
principles applied on a basis substantially consistent with
that of the audited financial statements included in the
Prospectus;
(B) the unaudited capsule information, if any,
included in the Prospectus does not agree with the amounts set
forth in the unaudited consolidated financial statements from
which it was derived or was not determined on a basis
substantially consistent with that of the audited financial
statements included in the Prospectus;
(C) at the date of the latest available balance
sheet read by such accountants, or at a subsequent specified
date not more than five days prior to the Closing Date, there
was any change in the capital stock, any increase in
short-term indebtedness or long-term debt of the Company and
consolidated subsidiaries or, at the date of the latest
available balance sheet read by such accountants, there was
any decrease in consolidated net current assets or net assets
as compared with amounts shown on the latest balance sheet
included in the Prospectus; or
<PAGE> 19
19
(D) for the period from the date of the latest
income statement included in the Prospectus to the closing
date of the latest available income statement read by such
accountants there were any decreases, as compared with the
corresponding period of the previous year, in consolidated
rental income, total revenues, net income or in the ratio of
earnings to fixed charges;
except in all cases set forth in clauses (C) and (D) above for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(iv) They have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in the Prospectus (in each case to the extent
that such dollar amounts, percentages and other financial information
are derived from the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from inquiries, a
reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
All financial statements and schedules included in material
incorporated by reference into the Prospectus shall be deemed included in the
Prospectus for purposes of this subsection.
(h) The Agent shall have received from Skadden, Arps, Slate,
Meagher & Flom LLP, counsel to the Agent, such opinion or opinions, dated the
Closing Date, with respect to the issuance and sale of the Notes, the
Indenture, the Registration Statement, the Prospectus and other related matters
as the Agent may reasonably require, and the Company shall have furnished to
such counsel such documents as they may request for the purpose of enabling
them to pass upon such matters. In giving its opinion, Skadden, Arps, Slate,
Meagher & Flom LLP may rely (i) as to matters of Maryland law on the opinion of
Ober, Kaler Grimes & Shriver, or other Maryland counsel approved by the Agent,
and (ii) as to matters of Michigan law on the opinion of Jaffe, Raitt, Heuer &
Weiss, Professional Corporation, which opinions shall be in form and substance
satisfactory to counsel for the Agent.
(i) Additional Conditions. There shall not have occurred: (i)
any change in the capital stock or long-term debt of the Company or any of the
Subsidiaries or any change, or any development involving a prospective change,
in or affecting the general affairs, management, stockholders' equity,
business, properties, condition (financial or other), results of operations or
prospects of the Company and the Subsidiaries which in the opinion of the
Agents, materially impairs the investment quality of the Notes; (ii) a
suspension or material limitation in trading in securities generally on the New
York Stock Exchange, the American Stock Exchange or the over-the-counter market
or the establishment of minimum prices on such exchanges or such market by the
Commission, by such exchange or by any other regulatory body or governmental
authority having jurisdiction; (iii) a general moratorium on commercial banking
activities declared by Federal, Michigan, Maryland or New York State
authorities; (iv) any downgrading in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) of the Rules and Regulations), or any
public announcement that any such organization has under surveillance or review
its rating of any debt securities of the Company (other than an announcement
with positive implications of a possible upgrading, and no implication of a
possible downgrading, of such rating); (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress or any other substantial national calamity or emergency; or (vi) any
material adverse change in the existing financial, political or economic
<PAGE> 20
20
conditions in the United States, including any effect of international
conditions on the financial markets in the United States, that in the judgment
of the Agent makes it impracticable or inadvisable to proceed with the
solicitation of offers to purchase Notes or the purchase of Notes from the
Company as principal pursuant to a Purchase Agreement, as the case may be.
(j) Other Information and Documentation. Prior to the Closing
Date, Sun and the Company shall have furnished to the Agent such further
information, certificates and documents as the Agent or counsel to the Agent
may reasonably request.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in the form and substance satisfactory to
counsel for the Agent.
Section 6. ADDITIONAL COVENANTS OF SUN AND THE COMPANY.
The Company and Sun covenant and agree that:
(a) Acceptance of Offer Affirms Representations and Warranties.
Each acceptance by the Company of an offer for the purchase of Notes shall be
deemed to be an affirmation that the representations and warranties of Sun and
the Company contained in this Agreement and in any certificate theretofore
given to the Agent pursuant hereto are true and correct at the time of such
acceptance, and an undertaking that such representations and warranties will be
true and correct at the time of delivery to the purchaser or his agent of the
Notes relating to such acceptance as though made at and as of each such time
(and such representations and warranties shall relate to the Registration
Statement and the Prospectus as amended or supplemented to each such time).
(b) Subsequent Delivery of Officers' Certificates. Sun and the
Company each agrees that during each Marketing Period, each time that the
Registration Statement or any Prospectus shall be amended or supplemented
(other than by a Pricing Supplement providing solely for the interest rates or
maturities of the Notes or the principal amount of Notes remaining to be sold
or similar changes), each time the Company sells Notes to the Agent as
principal and the Purchase Agreement specifies the delivery of an officers'
certificate under this Section 6(b) as a condition to the purchase of Notes
pursuant to such Purchase Agreement or the Company files with the Commission
any document incorporated by reference into any Prospectus (other than any
Current Report on Form 8-K relating solely to the issuance or offering of
securities other than the Notes), Sun and the Company shall submit to the Agent
a certificate, (i) as of the date of such amendment, supplement, Time of
Delivery relating to such sale or filing or (ii) if such amendment, supplement
or filing was not filed during a Marketing Period, as of the first day of the
next succeeding Marketing Period, representing that the statements contained in
the certificate referred to in Section 5(f) hereof which was last furnished to
the Agent are true and correct at the time of such amendment, supplement or
filing, as the case may be, as though made at and as of such time (except that
such statements shall be deemed to relate to the Registration Statement and
each Prospectus as amended and supplemented to such time).
(c) Subsequent Delivery of Legal Opinion. Sun and the Company
each agrees that during each Marketing Period, each time that the Registration
Statement or any Prospectus shall be amended or supplemented (other than by a
Pricing Supplement providing solely for the interest rates or maturities of the
Notes or the principal amount of Notes remaining to be sold or similar
changes), each time the Company sells Notes to the Agent as principal and the
Purchase Agreement specifies the delivery of a legal opinion under this Section
6(c) as a condition to the purchase of Notes pursuant to such Purchase
Agreement or the Company files with the Commission any document incorporated by
reference into any Prospectus (other than any Current Report on Form 8-K
relating solely to the issuance or offering of securities other than the
Notes), Sun and the Company shall, (i) concurrently
<PAGE> 21
21
with such amendment, supplement, Time of Delivery relating to such sale or
filing or (ii) if such amendment, supplement or filing was not filed during a
Marketing Period, on the first day of the next succeeding Marketing Period,
furnish the Agent and its counsel with the written opinion of outside counsel
to Sun and the Company, addressed to the Agent and dated the date of delivery
of such opinion, in form satisfactory to the Agent, to the same effect as the
opinion referred to in Section 5(e) hereof, but modified, as necessary, to
relate to the Registration Statement and each Prospectus as amended or
supplemented to the time of delivery of such opinion; provided, however, that
in lieu of such opinion, such counsel may furnish the Agent with a letter to
the effect that the Agent may rely on such prior opinion to the same extent as
though it was dated the date of such letter authorizing reliance (except that
statements in such prior opinion shall be deemed to relate to the Registration
Statement and each Prospectus as amended or supplemented to the time of
delivery of such letter authorizing reliance).
(d) Subsequent Delivery of Accountant's Letters. Sun and the
Company each agrees that during each Marketing Period, each time that the
Registration Statement or any Prospectus shall be amended or supplemented to
include additional financial information, each time the Company sells Notes to
the Agent as principal and the Purchase Agreement specifies the delivery of a
letter under this Section 6(d) as a condition to the purchase of Notes pursuant
to such Purchase Agreement or the Company files with the Commission any
document incorporated by reference into any Prospectus which contains
additional financial information, Sun and the Company shall cause Coopers &
Lybrand L.L.P. (or other independent accounts of the Company acceptable to the
Agent) to furnish the Agent, (i) concurrently with such amendment, supplement,
Time of Delivery relating to such sale or filing or (ii) if such amendment,
supplement, or filing was not filed during a Marketing Period, on the first day
of the next succeeding Marketing Period, a letter, addressed jointly to the
Company and the Agent and dated the date of delivery of such letter, in form
and substance reasonably satisfactory to the Agent, to the same effect as the
letter referred to in Section 5(g) hereof but modified to relate to the
Registration Statement and each Prospectus, as amended and supplemented to the
date of such letter, with such changes as may be necessary to reflect changes
in the financial statements and other information derived from the accounting
records of the Company; provided, however, that if the Registration Statement
or any Prospectus is amended or supplemented solely to include financial
information as of and for a fiscal quarter, such accountants may limit the
scope of such letter to the unaudited financial statements included in such
amendment or supplement unless there is contained therein any other accounting,
financial or statistical information that, in the reasonable judgment of the
Agent, should be covered by such letter, in which event such letter shall also
cover such other information.
(e) Opinion on Settlement Date. On any settlement date for the
sale of Notes, Sun and the Company shall, if requested by the Agent, furnish
the Agent with a written opinion of outside counsel to Sun and the Company,
dated such settlement date, in form satisfactory to the Agent, to the effect
set forth in Section 5(e) hereof, but modified, as necessary, to relate to the
Prospectus relating to the Notes to be delivered on such settlement date;
provided, however, that in lieu of such opinion, such counsel may furnish the
Agent with a letter to the effect that the Agent may rely on such prior opinion
to the same extent as though it was dated such settlement date (except that
statements in such prior opinion shall be deemed to relate to the Registration
Statement and such Prospectus as amended or supplemented to the time of
delivery of such letter authorizing reliance).
Section 7. INDEMNIFICATION AND CONTRIBUTION
(a) Indemnification of Agent. The Company shall indemnify and
hold harmless the Agent and each person, if any, who controls the Agent within
the meaning of the Act from and against any loss, claim, damage or liability,
joint or several, and any action in respect thereof, to which the Agent
<PAGE> 22
22
or controlling person may become subject, under the Act, the Exchange Act or
other federal or state statutory law or regulation, at common law or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus, or arises out of, or
is based upon, the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, and shall reimburse the Agent and controlling person for any
legal and other expenses reasonably incurred by the Agent or controlling person
in investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in the Form T-1
or made in the Registration Statement or the Prospectus in reliance upon and in
conformity with written information furnished to the Company by the Agent
specifically for inclusion therein; provided further, that as to any prospectus
included in the Registration Statement before it became effective under the Act
(a "Preliminary Prospectus") this indemnity agreement shall not inure to the
benefit of the Agent on account of any loss, claim, damage, liability or action
arising from the sale of Notes to any person by the Agent if the Agent failed
to send or give a copy of the Prospectus, as the same may be amended or
supplemented, to that person within the time required by the Act, and the
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact in such Preliminary Prospectus was
corrected in the Prospectus, unless such failure resulted from noncompliance by
the Company with Section 3(b). The foregoing indemnity agreement is in
addition to any liability which the Company may otherwise have to the Agent or
controlling person.
(b) Indemnification of the Company. The Agent shall indemnify and
hold harmless the Company, each of Sun's directors (including any person who,
with his or her consent, is named in the Registration Statement as about to
become a director of Sun), each of its officers who signed the Registration
Statement and any person who controls the Company within the meaning of the Act
from and against any loss, claim, damage or liability, joint or several, and
any action in respect thereof, to which the Company or any such director,
officer or controlling person may become subject, under the Act, the Exchange
Act or federal or state statutory law or regulation, at common law or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus, or
arises out of, or is based upon, the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, but in each case only to the extent that the
untrue statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information furnished
to the Company by the Agent specifically for inclusion therein, and shall
reimburse the Company or any such director, officer or controlling person for
any legal and other expenses reasonably incurred by such indemnified party in
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action. The foregoing indemnity agreement is in addition
to any liability which the Agent may otherwise have to the Company or any such
director, officer or controlling person.
(c) Notice. Promptly after receipt by an indemnified party under
this Section of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under this Section, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise than under this
Section except to the extent it has been materially prejudiced by such failure.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein,
<PAGE> 23
23
and, to the extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel satisfactory to
the indemnified party. After notice from the indemnifying party to the
indemnified party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the indemnified party
under this Section for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; provided, however, that the Agent shall have the right
to employ counsel to represent the Agent if, in the reasonable judgment of the
Agent, it is advisable for the Agent to be represented by separate counsel, and
in that event the fees and expenses of such counsel shall be paid by the
Company. The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) Contribution. If the indemnification provided for in this
Section 7 shall for any reason be unavailable to an indemnified party under
Section 7(a) or 7(b) hereof in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such
proportion as shall be appropriate to reflect the relative benefits received by
the Company on the one hand and the Agent on the other from the offering of the
Notes or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault
of the Company on the one hand and the Agent on the other with respect to the
statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Agent on the other with respect to such offering shall be
deemed to be in the same proportion as the total net proceeds from the offering
of the Notes (before deducting expenses) received by the Company bears to the
total commissions received by the Agent with respect to such offering. The
relative fault shall be determined by reference to whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company or the
Agent, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Agent agree that it would not be just and equitable if
contributions pursuant to this Section 7(d) were to be determined by pro rata
allocation or by any other method of allocation which does not take into
account the equitable considerations referred to herein. The amount paid or
payable by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this Section 7(d)
shall be deemed to include, for purposes of this Section 7(d), any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 7(d), the Agent shall not be required to contribute
any amount in excess of the amount by which the total price at which the Notes
sold through the Agent and distributed to the public were offered to the public
exceeds the amount of any damages which the Agent has otherwise paid or become
liable to pay by reason of any untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
<PAGE> 24
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Section 8. STATUS OF THE AGENT
In soliciting offers to purchase the Notes from the Company pursuant
to this Agreement (other than in respect of any Purchase Agreement), the Agent
is acting solely as agent for the Company and not as principal. The Agent will
make reasonable efforts to assist the Company in obtaining performance by each
purchaser whose offer to purchase Notes from the Company has been solicited by
the Agent and accepted by the Company but the Agent shall have no liability to
the Company in the event any such purchase is not consummated for any reason.
If the Company shall default in its obligations to deliver Notes to a purchaser
whose offer it has accepted, the Company shall (i) hold the Agent harmless
against any loss, claim or damage arising from or as a result of such default
by the Company and (ii), in particular, pay to the Agent any commission to
which it would be entitled in connection with such sale.
Section 9. REPRESENTATIONS, WARRANTIES AND OBLIGATIONS TO SURVIVE
DELIVERY
The respective indemnities, agreements, representations, warranties
and other statements of the Company and the Agent contained in this Agreement,
or made by or on behalf of them, respectively, pursuant to this Agreement,
shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of the Agent or any person controlling the
Agent or by or on behalf of the Company, and shall survive each delivery of and
payment for any of the Notes.
Section 10. TERMINATION
This Agreement may be terminated for any reason with respect to any
party hereto, at any time, by any party hereto upon the giving of one day's
written notice of such termination to the other parties hereto. If, at the
time of a termination, an offer to purchase any of the Notes has been accepted
by the Company but the time of delivery to the purchaser has not occurred, the
provisions of this Agreement shall remain in effect until such Notes are
delivered. The provisions of Sections 2(c), 3(d), 3(h), 3(i), 4, 7, 8 and 9
hereof shall survive any termination of this Agreement.
Section 11. SALES OF NOTES DENOMINATED IN A FOREIGN CURRENCY AND INDEXED
NOTES
If at any time the Company and the Agent shall determine to issue and
sell Notes denominated in a currency or currency unit other than U.S. Dollars,
which other currency may include a composite currency, or with respect to which
an index is used to determine the amounts of payments of principal and any
premium or interest, the Company and the Agent shall execute and deliver an
Amendment (a "Foreign Currency Amendment" or "Indexed Note Amendment," as the
case may be) in the form attached hereto as Exhibit D. Such amendment shall
establish, as appropriate additions and modifications that shall apply to the
sales, whether offered on an agency or principal basis, of the Notes covered
thereby.
Section 12. NOTICES
Except as otherwise provided herein, all notices and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if mailed or transmitted by any standard form of telecommunication.
Notices to the Agent shall be directed to it as follows: Lehman Brothers, 3
World Financial Center, New York, New York 10285, Attention: Medium Term Note
Department, 9th Floor; Telephone No.: (212) 640-8400; Telecopy No.: (212)
528-7035; notices to Sun or the Company shall be directed to either of them as
follows: Sun Communities Operating Limited Partnership, c/o Sun Communities,
Inc., 31700 Middlebelt Road, Suite 145, Farmington Hills,
<PAGE> 25
25
Michigan 48334, Attention: Chief Financial Officer; Telephone No. (810)
932-3100; Telecopy No. (810) 932-3072.
Section 13. BINDING EFFECT; BENEFITS
This Agreement shall be binding upon the Agent, Sun, the Company, and
their respective successors. This Agreement and the terms and provisions
hereof are for the sole benefit of only those persons, except that (a) the
representations, warranties, indemnities and agreements of Sun and the Company
contained in this Agreement shall also be deemed to be for the benefit of the
person or persons, if any, who control the Agent within the meaning of Section
15 of the Act, and (b) the indemnity agreement of the Agent contained in
Section 7 hereof shall be deemed to be for the benefit of directors of Sun
(including any person who, with his or her consent, is named in the
Registration Statement as about to become a director of Sun), officers of Sun
who have signed the Registration Statement and any person controlling the
Company. Nothing in this Agreement is intended or shall be construed to give
any person, other than the person referred to in this Section, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
Section 14. GOVERNING LAW; COUNTERPARTS
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York. This Agreement may be executed in
counterparts and the executed counterparts shall together constitute a single
instrument.
Section 15. PARAGRAPH HEADINGS
The paragraph headings used in this Distribution Agreement are for
convenience of reference only, and are not to affect the construction hereof or
be taken into consideration in the interpretation hereof.
<PAGE> 26
26
If the foregoing correctly sets forth our agreement, please
indicate your acceptance hereof in the space provided for that purpose below.
Very truly yours,
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
By: Sun Communities, Inc., its General Partner
By: ___________________________________
Authorized Signatory
SUN COMMUNITIES, INC.
By: __________________________________________
Authorized Signatory
CONFIRMED AND ACCEPTED,
as of the date first above written:
LEHMAN BROTHERS INC.
By: _________________________________
Authorized Signatory
<PAGE> 27
SCHEDULE A
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
MEDIUM-TERM NOTES, SERIES A
SCHEDULE OF PAYMENTS
The Company agrees to pay the Agent a commission equal to the
following percentage of the aggregate U.S. dollar equivalent of the principal
amount of Notes:
TERM COMMISSION RATE
9 months to less than 12 months 0.125%
12 months to less than 18 months 0.150%
18 months to less than 2 years 0.200%
2 years to less than 3 years 0.250%
3 years to less than 4 years 0.350%
4 years to less than 5 years 0.450%
5 years to less than 6 years 0.500%
6 years to less than 7 years 0.550%
7 years to less than 10 years 0.600%
10 years to less than 15 years 0.625%
15 years to less than 20 years 0.650%
20 years to 30 years 0.750%
More than 30 years To be negotiated at
time of sale
<PAGE> 28
EXHIBIT A
The following terms, if applicable, shall be agreed to by the Agent, Sun
and the Company in connection with each sale of Notes:
Principal Amount: $____________
(or principal amount of foreign currency or composite currency)
Interest Rate or Formula:
If Fixed Rate Note,
Interest Rate:
Default Rate:
Interest Payment Dates:
If Floating Rate Note,
Interest Rate Basis(es):
If LIBOR,
/__/ LIBOR Reuters
Page:
/__/ LIBOR Telerate
Page:
Designated LIBOR Currency:
If CMT Rate,
Designated CMT Telerate Page:
Designated CMT Maturity Index:
Index Maturity:
Spread and/or Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Payment Dates:
Default Rate:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Fixed Interest Rate, if any:
Calculation Agent:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
If Repayable:
Optional Repayment Date(s):
Original Issue Date:
Stated Maturity Date:
Specified Currency:
Exchange Rate Agent:
Authorized Denomination:
Purchase Price: ___%, plus accrued interest, if any, from ___________
Closing Date and Time:
Additional/Other Terms:
<PAGE> 29
EXHIBIT B
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
MEDIUM-TERM NOTES, SERIES A
ADMINISTRATIVE PROCEDURES
Medium-Term Notes Due Nine Months or More from Date of Issuance,
Series A (the "Notes") are to be offered on a continuing basis by Sun
Communities Operating Limited Partnership (the "Company"). Lehman Brothers
Inc., as agent (the "Agent"), has agreed to use its reasonable best efforts to
solicit offers to purchase the Notes. The Notes are being sold pursuant to a
Distribution Agreement between the Company and the Agent dated _______________
___, 1997 (as it may be supplemented or amended from time to time, the
"Distribution Agreement") to which these administrative procedures are attached
as an exhibit. The Notes will be issued under an indenture, dated as of April
24, 1996, between the Company, Sun Communities, Inc. ("Sun"), the general
partner of the Company, and Bankers Trust Company, as trustee (the "Trustee"),
as heretofore supplemented. The Notes will rank equally with all other
unsecured and unsubordinated indebtedness of the Company and will have been
registered with the Securities and Exchange Commission (the "Commission").
Terms defined in the Prospectus relating to the Notes (the "Prospectus") and in
the Distribution Agreement shall have the same meaning when used in this
exhibit. Special administrative procedures for Multi-Currency Notes and for
Global Securities relating to Book-Entry Notes follow these administrative
procedures.
Administrative responsibilities, document control and record-keeping
functions to be performed on behalf of the Company will be performed by Sun's
Chief Financial Officer. Administrative procedures for the offering are
explained below.
PRICE TO PUBLIC
Each Note will be issued at 100% of principal amount, unless otherwise
determined by the Company.
DATE OF ISSUANCE
Each Note will be dated and issued as of the date of its
authentication by the Trustee.
MATURITIES
Each Note will mature on a Business Day (as defined below) selected by
the purchaser and agreed upon by the Company, such date being at least nine
months from the date of issuance. Each Floating Rate Note will mature on an
Interest Payment Date (as defined below).
"Business Day" shall mean any day which is not a Saturday or Sunday
and which is not a day on which banking institutions are generally authorized
or obligated by law to close in The City of New York.
REGISTRATION
Notes will be issued only in fully registered form as either a
Book-Entry Note or a Certificated Note. Certificated Notes may be presented
for registration of transfer or exchange at the Trustee's New York office.
<PAGE> 30
B-2
DENOMINATIONS
The Notes (other than Notes represented by Global Securities) will be
issued and payable in U.S. dollars in the denomination of $1,000 and any larger
denomination which is an integral multiple of $1,000.
INTEREST PAYMENTS
Each Note bearing interest at a fixed rate (a "Fixed Rate Note") will
bear interest from its issue date at the annual rate stated on the face
thereof, payable on May 1 and November 1 of each year (each an "Interest
Payment Date" with respect to such Fixed Rate Note) and at Stated Maturity or
upon redemption, if applicable.
Special provisions are set forth in the Prospectus relating to Notes
bearing interest at a rate or rates determined by reference to an interest rate
formula ("Floating Rate Notes") at a rate determined pursuant to the formula
stated on the face thereof, payable in arrears on such dates as are specified
therein (each an "Interest Payment Date" with respect to such Floating Rate
Note).
Interest on Fixed Rate Notes will be calculated and paid on the basis
of a 360-day year of twelve 30-day months. Interest will be payable to the
person in whose name such Note is registered at the close of business on the
fifteenth day (whether or not a Business Day) next preceding an Interest
Payment Date with respect to Fixed Rate Notes or Floating Rate Notes (the
"Record Dates") next preceding the respective Interest Payment Date; provided,
however, that interest payable at Stated Maturity will be payable to the person
to whom principal shall be payable. Any payment of principal and interest on
such Note required to be paid on an Interest Payment Date or at Stated Maturity
or upon redemption, if applicable, which is not a Business Day shall be
postponed to the next day which is a Business Day. The first payment of
interest on any Note originally issued between a Record Date and an Interest
Payment Date will be made on the Interest Payment Date following the next
succeeding Record Date. All interest payments, excluding interest payments
made at Stated Maturity or upon redemption, if applicable, will be made by
check mailed to the person entitled thereto as provided above, or, at the
option of the Company, by wire transfer to an account maintained by such person
with a bank located in the United States. Notwithstanding the foregoing, the
holder of $10 million or more in aggregate principal amount of Notes with the
same Interest Payment Date may request payment by wire transfers.
On the fifth Business Day immediately preceding each Interest Payment
Date, the Trustee will furnish the Company with the total amount of the
interest payments to be made on such Interest Payment Date. The Trustee (or
any duly selected paying agent) will provide monthly to the Company's Treasury
Department a list of the principal and interest to be paid on Notes maturing in
the next succeeding month. The Company will provide to the Trustee not later
than the payment date sufficient moneys to pay in full all principal and
interest payments due on such payment date. The Trustee will assume
responsibility for withholding taxes on interest paid as required by law.
ACCEPTANCE AND REJECTION OF OFFERS
The Company shall have the sole right to accept offers to purchase
Notes and may reject any such offer in whole or in part. The Agent shall
promptly communicate to the Company, orally or in writing, each reasonable
offer to purchase Notes from the Company received by it other than those
rejected by the Agent. The Agent shall have the right, in its discretion
reasonably exercised without advising the Company, to reject any offers in
whole or in part.
<PAGE> 31
B-3
SETTLEMENT
The receipt of immediately available funds in U.S. Dollars by the
Company in payment for a Note (less the applicable commission) and the
authentication and issuance of such Note shall, with respect to such Note,
constitute "Settlement." All offers accepted by the Company will be settled
from one to five Business Days from the date of acceptance by the Company
pursuant to the timetable for Settlement set forth below unless the Company and
the purchaser agree to Settlement on a later date; provided, however, that the
Company will so notify the Trustee of any such later date on or before the
Business Day immediately prior to the Settlement date.
SETTLEMENT PROCEDURES
In the event of a purchase of Notes by the Agent, as principal,
appropriate Settlement details will be set forth in the Purchase Agreement to
be entered into between the Agent and the Company pursuant to the Distribution
Agreement. In the event of the sale of a Multi- Currency Note or an Indexed
Note, additional or different Settlement details may be set forth in the
Amendment to be entered into between the Agent and the Company pursuant to the
Distribution Agreement.
Settlement procedures with regard to each Note sold through the Agent
shall be as follows:
A. The Agent will advise the Company by telephone, telex or
facsimile, of the following Settlement information:
1. Exact name in which the Note is to be registered ("Registered
Owner").
2. Exact address of the Registered Owner and address for payment
of principal and interest, if any.
3. Taxpayer identification number of the Registered Owner.
4. Principal amount of the Note (and, if multiple Notes are to be
issued, denominations thereof).
5. Settlement date.
6. Stated Maturity.
7. Issue Price and any OID information.
8. Trade Date/Original Issue Date.
9. Interest rate:
(a) Fixed Rate Notes:
(i) interest rate
(ii) overdue rate, if any
<PAGE> 32
B-4
(b) Floating Rate Notes:
(i) interest rate basis
(ii) initial interest rate
(iii) spread or spread multiplier, if any
(iv) interest rate reset periods
(v) interest payment dates
(vi) index maturity
(vii) maximum and minimum interest rates, if any
(viii) record dates
(ix) interest determination dates
(x) overdue rate, if any
10. The date on or after which the Notes are redeemable at the
option of the Company, and additional redemption or repurchase
provisions, if any.
11. Wire transfer information.
12. Agent's Commission (to be paid in the form of a discount from
the proceeds remitted to the Company upon Settlement).
B. The Company will confirm the above Settlement information to
the Trustee by telephone, telex or facsimile, and the Trustee will assign a
Note number to the transaction. If the Company rejects an offer, the Company
will promptly notify the Agent and the Trustee by telephone.
C. The Trustee will complete the first page of the preprinted
4-ply Note packet [Note: Such a packet need not be prepared if the Company is
utilizing the book-entry system, see procedures below], the form of which was
previously approved by the Company, the Agent and the Trustee.
D. The Trustee will deliver the Note (with the attached white
confirmation) and the yellow and blue stubs to the Agent. The Agent will
acknowledge receipt of the Note by completing the yellow stub and returning it
to the Trustee.
E. The Agent will cause to be wire transferred to a bank account
designated by the Company immediately available funds in U.S. dollars in the
amount of the principal amount of the Note, less the applicable commission or
discount, if any.
F. The Agent will deliver the Note (with the attached white
confirmation) to the purchaser against payment in immediately available funds
in the amount of the principal amount of the Note. The Agent will deliver to
the purchaser a copy of the most recent Prospectus applicable to the Note with
or prior to any written offer of Notes, delivery of the Note and the
confirmation and payment by the purchaser for the Note.
G. The Agent will obtain the acknowledgement of receipt for the
Note and Prospectus by the purchaser through the purchaser's completion of the
blue stub.
H. The Trustee will mail the pink stub to Sun's Chief Financial
Officer.
<PAGE> 33
B-5
SETTLEMENT PROCEDURES TIMETABLE
For offers accepted by the Company, Settlement procedures "A" through
"H" set forth above shall be completed on or before the respective times set
forth below:
SETTLEMENT
PROCEDURE TIME (NEW YORK)
===============================================================
A 5 PM on date of order
B 3 PM on the Business Day prior to Settlement
Date
C-D 12 Noon on the Settlement Date
E 2:15 PM on the Settlement date
F-G 3 PM on the Settlement Date
H 5 PM on Business Day after the Settlement
Date
FAILS
In the event that a purchaser of a Note shall either fail to accept
delivery of or make payment for such Note on the date fixed by the Company for
Settlement, the Agent will immediately notify the Trustee and Sun's Chief
Financial Officer by telephone, confirmed in writing, of such failure and
return the Note to the Trustee. Upon the Trustee's receipt of the Note from
the Agent, the Company will promptly return to the Agent an amount of
immediately available funds in U.S. dollars equal to any amount previously
transferred to the Company in respect of the Note pursuant to advances made by
the Agent. Such returns will be made on the Settlement date, if possible, and
in any event not later than 12 noon (New York City time) on the Business Day
following the Settlement date. The Company will reimburse the Agent on an
equitable basis for its loss of the use of the funds during the period when the
funds were credited to the account of the Company. Upon receipt of the Note in
respect of which the default occurred, the Trustee will mark the Note
"cancelled," make appropriate entries in its records and deliver the Note to
the Company with an appropriate debit advice. The Agent will not be entitled
to any commission with respect to any Note which the purchaser does not accept
or make payment for.
PRICING REDEMPTION
Except as otherwise specified in the applicable Pricing Supplement and
on the Notes, the Notes will not be redeemable prior to their Stated Maturity.
If so specified in a Pricing Supplement and on the Note, such Note will be
subject to redemption by the Company, at any time on or after the date set
forth on such supplement and the Note, in whole or from time to time in part,
at the option of the Company, at the redemption price set forth therein,
together with interest accrued thereon on the date of redemption.
Notice of redemption shall be given by first-class mail postage
prepaid, mailed not less than 30 days nor more than 60 days prior to the date
of redemption, to each holder of Notes to be redeemed, in the manner and in
accordance with the Indenture. In the event of redemption in part of any Note,
a new Note for the amount of the unredeemed portion shall be issued in the name
of the Holder upon cancellation of the redeemed Note.
<PAGE> 34
B-6
MATURITY
Upon presentation of each Note at Maturity the Trustee (or any duly
appointed Paying Agent) will pay the principal amount thereof, together with
accrued interest through the date of redemption. Such payment shall be made in
immediately available funds in U.S. dollars, provided that the Note is
presented to the Trustee (or any such Paying Agent) in time for the Trustee (or
such Paying Agent) to make payments in such funds in accordance with its normal
procedures. The Company will provide the Trustee (and any such Paying Agent)
with funds available for immediate use for such purpose. Notes presented at
Maturity will be cancelled by the Trustee as provided in the Indenture.
PROCEDURES FOR ESTABLISHING THE TERMS OF THE NOTES
The Company and the Agent will discuss from time to time the rates to
be borne by the Notes that may be sold as a result of the solicitation of
offers by the Agent. Once the Agent has recorded any indication of interest in
Notes upon certain terms, and communicated with the Company, if the Company
accepts an offer to purchase Notes upon such terms, it will prepare a Pricing
Supplement in the form previously approved by the Agent, reflecting the terms
of such Notes and, after approval from the Agent, will arrange to have such
Pricing Supplement (together with the Prospectus, if amended or supplemented)
filed with the Commission and will supply an appropriate number of copies of
the Prospectus, as then amended or supplemented, together with such Pricing
Supplement, to the Agent. See "Delivery of Prospectus." No settlements with
respect to Notes upon such terms may occur prior to such filing and the Agent
will not, prior to such filing, mail confirmations to customers who have
offered to purchase Notes upon such terms. After such filing, sales, mailing
of confirmations and settlements may occur with respect to Notes upon such
terms, subject to the provisions of "Delivery of Prospectus" below.
If the Company decides to post rates and a decision has been reached
to change interest rates, the Company will promptly notify the Agent. The
Agent will forthwith suspend solicitation of purchases. At that time, the
Agent will recommend and the Company will establish rates to be so "posted."
Following establishment of posted rates and prior to the filing described in
the following sentence, the Agent may only record indications of interest in
purchasing Notes at the posted rates. Once the Agent has recorded any
indication of interest in Notes at the posted rates and communicated with the
Company, if the Company plans to accept an offer at the posted rate, it will
prepare a Pricing Supplement reflecting such posted rates and, after approval
from the Agent, will arrange to have such Pricing Supplement (together with the
Prospectus if amended or supplemented) filed with the Commission and will
supply an appropriate number of copies of the Prospectus, as then amended or
supplemented, to the Agent. See "Delivery of Prospectus." No settlements at
the posted rates may occur prior to such filing and the Agent will not, prior
to such filing, mail confirmations to customers who have offered to purchase
Notes at the posted rates. After such filing, sales, mailing of confirmations
and settlements may resume, subject to the provisions of "Delivery of
Prospectus" below.
SUSPENSION OF SOLICITATION; AMENDMENT OR SUPPLEMENT
In the event that at the time the Agent, at the direction of the
Company, suspends solicitation of offers to purchase from the Company there
shall be any orders outstanding which have not been settled, the Company will
promptly advise the Agent and the Trustee whether such orders may be settled
and whether copies of the Prospectus as theretofore amended and/or supplemented
as in effect at the time of the suspension may be delivered in connection with
the settlement of such orders. The Company will have the sole responsibility
for such decision and for any arrangements which may be made in the event that
the Company determines that such orders may not be settled or that copies of
such Prospectus may not be so delivered.
<PAGE> 35
B-7
DELIVERY OF PROSPECTUS
A copy of the Prospectus as most recently amended or supplemented on
the date of delivery thereof, together with the applicable Pricing Supplement,
must be delivered to a purchaser prior to or together with the earlier of the
delivery of (i) the written confirmation of a sale sent to a purchaser or his
agent and (ii) any Note purchased by such purchaser. The Company shall ensure
that the Agent receives copies of the Prospectus and each amendment or
supplement thereto (including the applicable Pricing Supplement) in such
quantities and within such time limits as will enable the Agent to deliver such
confirmation or Note to a purchaser as contemplated by these procedures and in
compliance with the preceding sentence. Copies of Pricing Supplements should
be delivered to Lehman Brothers Inc., c/o ADP, Prospectus Services, 536 Broad
Hollow Road, Melville, New York 11747, Attention: Mike Ward, (516) 254-7106,
telecopier: (516) 249-7942 and by hand to Lehman Brothers Inc., 3 World
Financial Center, 9th floor, New York, New York 10285, Attention: Brunnie
Vazquez, (212) 526-8400. If, since the date of acceptance of a purchaser's
offer, the Prospectus shall have been supplemented solely to reflect any sale
of Notes on terms different from those agreed to between the Company and such
purchaser or a change in posted rates not applicable to such purchaser, such
purchaser shall not receive the Prospectus as supplemented by such new
supplement, but shall receive the Prospectus as supplemented to reflect the
terms of the Notes being purchased by such purchaser and otherwise as most
recently amended or supplemented on the date of delivery of the Prospectus.
The Trustee will make all such deliveries with respect to all Notes sold
directly by the Company.
AUTHENTICITY OF SIGNATURES
The Company will cause the Trustee to furnish the Agent from time to
time with the specimen signatures of each of the Trustee's officers, employees
and agents who have been authorized by the Trustee to authenticate Notes, but
the Agent will have no obligation or liability to the Company or the Trustee in
respect of the authenticity of the signature of any officer, employee or agent
of the Company or the Trustee on any Note.
ADVERTISING COSTS
The Company will determine with the Agent the amount and nature of
advertising that may be appropriate in offering the Notes. Advertising
expenses incurred with the consent of the Company will be paid by the Company.
<PAGE> 36
B-8
SPECIAL ADMINISTRATIVE PROCEDURES
FOR MULTI-CURRENCY NOTES
Unless otherwise set forth in an applicable Foreign Currency
Amendment, the following procedures and terms shall apply to Multi- Currency
Notes in addition to, and to the extent inconsistent therewith in replacement
of, the procedures and terms set forth above.
DENOMINATIONS
The authorized denominations for Multi-Currency Notes will be set
forth in the applicable Pricing Supplement.
CURRENCIES
Unless otherwise specified in the applicable Pricing Supplement,
purchasers of Multi-Currency Notes are required to pay for such Multi- Currency
Notes in the Specified Currency in immediately available funds. If requested
by the purchaser of the Multi-Currency Note on or prior to the fifth Business
Day preceding the date of delivery of the Multi-Currency Notes (or by such
other day as the Presenting Agent shall determine), the Presenting Agent will
arrange the conversion of U.S. dollars into such Specified Currency to enable
the purchaser to pay for the Multi-Currency Notes. Each such conversion will
be made by the Presenting Agent on such terms and subject to such conditions,
limitations and charges as such Presenting Agent may from time to time
establish in accordance with its regular foreign exchange practices. All costs
of exchange will be borne by the purchasers of the Multi-Currency Notes.
PAYMENT OF PRINCIPAL AND INTEREST
The principal of, premium, if any, and interest on Multi-Currency
Notes will be payable in the Specified Currency. Unless otherwise indicated in
the applicable Pricing Supplement, the agent appointed by the Company (the
"Exchange Rate Agent") will convert all such payments of principal, premium, if
any, and interest to U.S. dollars. However, unless otherwise indicated in the
applicable Pricing Supplement, the holder of a Multi-Currency Note may elect to
receive such payments in the Specified Currency as described below.
Any U.S. dollar amount to be received by a holder of a Multi-Currency
Note will be based on the highest bid quotation in The City of New York
received by the Exchange Rate Agent at approximately 11:00 A.M., New York City
time, on the second Business Day preceding the applicable payment date from
three recognized foreign exchange dealers (one of which may be the Exchange
Rate Agent) for the purchase by the quoting dealer of the Specified Currency
for U.S. dollars for settlement on such payment date in the aggregate amount of
the Specified Currency payable to all holders of Notes scheduled to receive
U.S. dollar payments and at which the applicable dealer commits to execute a
contract. If such bid quotations are not available, payments will be made in
the Specified Currency. All currency exchange costs will be borne by the
holder of the Multi-Currency Note by deductions from such payments.
A holder of a Multi-Currency Note may, unless otherwise specified in
the applicable Pricing Supplement, elect to receive payment of the principal
of, premium, if any, and interest on such Multi-Currency Notes in the Specified
Currency, by transmitting a written request for such payment by mail, hand
delivered, or by cable, telex or other form of facsimile transmission to the
principal office of the Trustee (acting as the Company's paying agent in The
City of New York) on or prior to the Record Date or at least sixteen days prior
to Maturity, as the case may be, such election to remain in effect until
revoked by written notice to the Trustee received by the Trustee on or prior to
the Record
<PAGE> 37
B-9
Date or at least sixteen days prior to Maturity, as the case may be. A holder
of a Multi-Currency Note may elect to receive payment in the Specified Currency
for all principal, premium, if any, and interest payments and need not file a
separate election for each payment.
Interest on Multi-Currency Notes paid in U.S. dollars will be paid in
the manner specified in the applicable Pricing Supplement. Unless otherwise
specified in the applicable Pricing Supplement, interest on Multi-Currency
Notes paid in the Specified Currency will be paid by wire transfer to a bank
account maintained by the holder in the country of the Specified Currency. The
principal of Multi-Currency Notes, together with interest accrued and unpaid
therein, due at Maturity will be paid in immediately available funds against
presentation of such Multi-Currency Notes at the principal office of the
Trustee, provided that principal, premium, if any, and interest payable at
Maturity in a Specified Currency will be paid by wire transfer to such bank
account. Any payment of principal or interest required to be made on an
Interest Payment Date or at Maturity of a Multi-Currency Note which is not a
Business Day need not be made on such day, but may be made on the next
succeeding Business Day with the same force and effect as if made on the
Interest Payment Date or Maturity, as the case may be, and no interest shall
accrue from the period from and after such Interest Payment Date or Maturity.
PAYMENT CURRENCY
If a Specified Currency is not available for payment of principal or
interest with respect to a Multi-Currency Note due to the imposition of
exchange controls or other circumstances beyond the reasonable control of the
Company, the Company will be entitled to satisfy its obligations to holders of
Multi-Currency Notes by making such payment in U.S. dollars on the basis of the
noon buying rate in The City of New York for cable transfers of the Specified
Currency as certified for customs purposes by the Federal Reserve Bank of New
York (the "Market Exchange Rate") on the second day prior to such payment, or
if such Market Exchange Rate is not then available, on the basis of the most
recently available Market Exchange Rate or as otherwise indicated in the
applicable Pricing Supplement. Any payment made under such circumstances in
U.S. dollars where required payment is in a Specified Currency will not
constitute a default under the Indenture.
OUTSTANDING MULTI-CURRENCY NOTES
For purposes of calculating the principal amount of any Multi-Currency
Note for any purpose under the Indenture, the principal amount of such
Multi-Currency Note at any time Outstanding shall be deemed to be the U.S.
dollar equivalent at the Market Exchange Rate, determined as of the date of the
original issuance of such Multi-Currency Note, of the principal amount of such
Multi-Currency Note.
DETAILS FOR SETTLEMENT OF MULTI-CURRENCY NOTES
In addition to the Settlement information specified in "Settlement
Procedures" above, the Presenting Agent shall communicate to the Company in the
manner set forth in "Settlement Procedures" the following information:
1. Specified Currency
2. Denominations
3. Wire transfer and overseas bank account information (if holder
has elected payment in a Specified Currency).
<PAGE> 38
B-10
SPECIAL ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
Each Note will be represented by either a Global Security delivered to
the Trustee, as agent for the Depository Trust Company ("DTC"), and recorded in
the book-entry system maintained by DTC or a certificate delivered to the
Holder thereof or a Person designated by such Holder. An owner of a Book-Entry
Note will not be entitled to receive a certificate representing such Note. In
connection with the qualification of the Book-Entry Notes for eligibility in
the book-entry system maintained by DTC, the Trustee will perform the
custodial, document control and administrative functions described below, in
accordance with its respective obligations under a Letter of Representations
from the Company and the Trustee to DTC and a Medium-Term Note Certificate
Agreement previously entered into between the Trustee and DTC, and its
obligations as a participant in DTC, including DTC's Same-Day Funds Settlement
System ("SDFS"). Except as otherwise set forth in this Exhibit B, Book-Entry
Notes will be issued in accordance with the administrative procedures set forth
below.
ISSUANCE
On any date of settlement (as defined under "Settlement" below) of one
or more Fixed Rate Book-Entry Notes, the Company will issue a single Global
Security in fully registered form without coupons representing the principal
amount of all of such Notes that have the same original issuance date, interest
rate and Stated Maturity. Similarly, on any settlement date for one or more
Floating Rate Book-Entry Notes, the Company will issue a single Global Security
representing the principal amount of all of such Notes that have the same
interest rate formula, original issuance date, Initial Interest Rate, Interest
Payment Dates, Index Maturity, Spread, Spread Multiplier, minimum interest rate
(if any), maximum interest rate (if any) and Stated Maturity. Each Global
Security will be dated and issued as of the date of its authentication by the
Trustee. Each Global Security will have an interest accrual date (the
"Interest Accrual Date"), which will be (i) with respect to an original Global
Security (or any portion thereof), its original issuance date and (ii) with
respect to any Global Security (or portion thereof) issued subsequently upon
exchange of a Global Security or in lieu of a destroyed, lost or stolen Global
Security, the most recent Interest Payment Date to which interest has been paid
or duly provided for on the predecessor Global Security or Securities (or if no
such payment or provision has been made, the original issuance date of the
predecessor Global Security), regardless of the date of authentication of such
subsequently issued Global Security. No Global Security will represent (i)
both Fixed Rate and Floating Rate Book-Entry Notes or (ii) any Certificated
Note or (iii) any Multi-Currency or Indexed Note.
IDENTIFICATION NUMBERS
The Company will arrange, on or prior to commencement of a program for
the offering of Book-Entry Notes, with the CUSIP Service Bureau of Standard &
Poor's Corporation (the "CUSIP Service Bureau") for the reservation of a series
of CUSIP numbers (including tranche numbers), consisting of approximately 900
CUSIP numbers and relating to Global Securities representing the Book-Entry
Notes. The Trustee has or will obtain from the CUSIP Service Bureau a written
list of such series of reserved CUSIP numbers and will deliver to the Company
and DTC such written list of 900 CUSIP numbers of such series. The Company
will assign CUSIP numbers to Global Securities as described below under
Settlement Procedure "B." DTC will notify the CUSIP Service Bureau
periodically of the CUSIP numbers that the Company has assigned to Global
Securities. The Trustee will notify the Company at any time when fewer than
100 of the reserved CUSIP numbers remain unassigned to Global Securities, and
if it deems necessary, the Company will reserve additional CUSIP numbers for
assignment to Global Securities representing Book- Entry Notes. Upon obtaining
such additional CUSIP numbers the Trustee shall deliver such additional CUSIP
numbers to the Company and DTC.
<PAGE> 39
B-11
REGISTRATION
Each Global Security will be registered in the name of Cede & Co., as
nominee for DTC, on the Securities Register maintained under the Indenture
governing such Global Security. The beneficial owner of a Book-Entry Note (or
one or more indirect participants in DTC designated by such owner) will
designate one or more participants in DTC (with respect to such Note, the
"Participants") to act as agent or agents for such owner in connection with the
book-entry system maintained by DTC, and DTC will record in book-entry form, in
accordance with instructions provided by such Participants, a credit balance
with respect to such Note in the account of such Participants. The ownership
interest of such beneficial owner in such Note will be recorded through the
records of such Participants or through the separate records of such
Participants and one or more indirect participants in DTC.
TRANSFERS
Transfers of a Book-Entry Note will be accomplished by book entries
made by DTC and, in turn, by Participants (and in certain cases, one or more
indirect participants in DTC) acting on behalf of beneficial transferors and
transferees of such Note.
CONSOLIDATION AND EXCHANGE
The Trustee may deliver to DTC and the CUSIP Service Bureau at any
time a written notice of consolidation specifying (i) the CUSIP numbers of two
or more Outstanding Global Securities that represent (A) Fixed Rate Book-Entry
Notes having the same original issuance date, interest rate and Stated Maturity
and with respect to which interest has been paid to the same date or (B)
Floating Rate Book-Entry Notes having the same interest rate formula, original
issuance date, Initial Interest Rate, Interest Payment Dates, Index Maturity,
Spread or Spread Multiplier, minimum interest rate (if any), maximum interest
rate (if any) and with respect to which interest has been paid to the same
date, (ii) a date, occurring at least thirty days after such written notice is
delivered and at least thirty days before the next Interest Payment Date for
such Book-Entry Notes, on which such Global Securities shall be exchanged for a
single replacement Global Security and (iii) a new CUSIP number, obtained from
the Company, to be assigned to such replacement Global Security. Upon receipt
of such a notice, DTC will send to its participants (including the Trustee) a
written reorganization notice to the effect that such exchange will occur on
such date. Prior to the specified exchange date, the Trustee will deliver to
the CUSIP Service Bureau a written notice setting forth such exchange date and
the new CUSIP number and stating that, as of such exchange date, the CUSIP
numbers of the Global Securities to be exchanged will no longer be valid. On
the specified exchange date, the Trustee will exchange such Global Securities
for a single Global Security bearing the new CUSIP number and a new Interest
Accrual Date, and the CUSIP numbers of the exchanged Global Securities will, in
accordance with CUSIP Service Bureau procedures, be cancelled and not
immediately reassigned. Notwithstanding the foregoing, if the Global
Securities to be exchanged exceed $200,000,000 in aggregate principal amount,
one Global Security will be authenticated and issued to represent each
$200,000,000 of principal amount of the exchanged Global Securities and an
additional Global Security will be authenticated and issued to represent any
remaining principal amount of such Global Securities (see "Denominations"
below).
MATURITIES
Each Book-Entry Note will mature on a date not less than nine months
after the settlement date for such Note. A Floating Rate Book- Entry Note will
mature only on an Interest Payment Date for such Note.
<PAGE> 40
B-12
DENOMINATIONS
Book-Entry Notes will be issued in principal amounts of $1,000 or any
amount in excess thereof that is an integral multiple of $1,000. Global
Securities representing one or more Book-Entry Notes will be denominated in
principal amounts not in excess of $200,000,000. If one or more Book-Entry
Notes having an aggregate principal amount in excess of $200,000,000 would, but
for the preceding sentence, be represented by a single Global Security, then
one Global Security will be issued to represent each $200,000,000 principal
amount of such Book-Entry Note or Notes and an additional Global Security will
be issued to represent any remaining principal amount of such Book-Entry Note
or Notes. In such a case, each of the Global Securities representing such
Book-Entry Note or Notes shall be assigned the same CUSIP number.
INTEREST
General. Interest on each Book-Entry Note will accrue from the
Interest Accrual Date of the Global Security representing such Note. Each
payment of interest on a Book-Entry Note will include interest accrued through
the day preceding, as the case may be, the Interest Payment Date or Maturity;
provided, however, that if the Interest Reset Dates with respect to any such
Note are daily or weekly, interest payable on any Interest Payment Date, other
than interest payable on any date on which principal for such Note is payable,
will include interest accrued from but excluding the second preceding Regular
Record Date to and including the next preceding Regular Record Date. Interest
payable at the Maturity of a Book-Entry Note will be payable to the Person to
whom the principal of such Note is payable. Standard & Poor's Corporation will
use the information received in the pending deposit message described under
Settlement Procedure "C" below in order to include the amount of any interest
payable and certain other information regarding the related Global Security in
the appropriate weekly bond report published by Standard & Poor's Corporation.
On the first Business Day of January, April, July and October of each
year, the Trustee will deliver to the Company and DTC a written list of Regular
Record Dates and Interest Payment Dates that will occur with respect to
Floating Rate Book-Entry Notes during the six-month period beginning on such
first Business Day. Promptly after each Interest Determination Date (as
defined in Appendix A hereto) for Floating Rate Notes, the Company will notify
the Trustee, and the Trustee in turn will notify Standard & Poor's Corporation,
of the interest rates determined on such Interest Determination Date.
PAYMENTS OF PRINCIPAL AND INTEREST
Payments of Interest Only. Promptly after each Regular Record Date,
the Trustee will deliver to the Company and DTC a written notice specifying by
CUSIP number the amount of interest to be paid on each Global Security on the
following Interest Payment Date (other than an Interest Payment Date coinciding
with Maturity) and the total of such amounts. DTC will confirm the amount
payable on each Global Security on such Interest Payment Date by reference to
the daily bond reports published by Standard & Poor's Corporation. The Company
will pay to the Trustee, as paying agent, the total amount of interest due on
such Interest Payment Date (other than at Maturity), and the Trustee will pay
such amount to DTC at the times and in the manner set forth below under "Manner
of Payment."
Payments at Maturity. On or about the first Business Day of each
month, the Trustee will deliver to the Company, DTC and the Trustee a written
list of principal and interest to be paid on each Global Security maturing in
the following month. The Company, the Trustee and DTC will confirm the amounts
of such principal and interest payments with respect to each such Global
Security on or about the fifth Business Day preceding the Maturity of such
Global Security. The Company
<PAGE> 41
B-13
will pay to the Trustee, as the paying agent, the principal amount of such
Global Security, together with interest due at such Maturity. The Trustee will
pay such amount to DTC at the times and in the manner set forth below under
"Manner of Payment."
Promptly after payment to DTC of the principal and interest due at the
Maturity of such Global Security, the Trustee will cancel such Global Security
and deliver it to the Company with an appropriate debit advice. On the first
Business Date of each month, the Trustee will prepare a written statement
indicating the total principal amount of Outstanding Global Securities for
which it serves as trustee as of the immediately preceding Business Day.
Manner of Payment. The total amount of any principal and interest due
on Global Securities on any Interest Payment Date or at Maturity shall be paid
by the Company to the Trustee in funds available for use by the Trustee as of
9:30 A.M. (New York City time) on such date. The Company will make such
payment on such Global Securities by instructing the Trustee to withdraw funds
from an account maintained by the Company at the Trustee. The Company will
confirm such instructions in writing to the Trustee, with a copy to the Trustee
under the Indenture governing such Global Securities if such Global Securities
are of subordinated or junior subordinated rank. For maturity, redemption or
any other principal payments: prior to 10 A.M. (New York City time) on such
date or as soon as possible thereafter, the Trustee will make such payments to
DTC in same day funds in accordance with DTC's Same Day Funds Settlement Paying
Agent Operating Procedures. For interest payments: the Trustee will make such
payments to DTC in accordance with existing arrangements between DTC and the
Trustee. DTC will allocate such payments to its participants in accordance
with its existing operating procedures. Neither the Company (either as issuer
or as Paying Agent) nor the Trustee shall have any direct responsibility or
liability for the payment by DTC to such Participants of the principal of and
interest on the Book-Entry Notes.
The amount of any taxes required under applicable law to be withheld
from any interest payment on a Book-Entry Note will be determined and withheld
by the Participant, indirect participant in DTC or other Person responsible for
forwarding payments and materials directly to the beneficial owner of such
Note.
SETTLEMENT PROCEDURES
Settlement Procedures with regard to each Book-Entry Note sold by the
Company through an Agent, as agent, shall be as follows:
A. The Agent will advise the Company by telephone, telex or
facsimile, of the following settlement information:
1. Exact name in which Note is to be registered ("Registered
Owner").
2. Exact address of the Registered Owner and address for payments
of principal and interest, if any.
3. Taxpayer identification number of the Registered Owner.
4. Principal amount of the Note (and, if multiple Notes are to be
issued, denominations thereof).
5. Settlement date.
6. Stated Maturity.
<PAGE> 42
B-14
7. Issue Price and any OID information.
8. Trade date.
9. The DTC Participant account number of such Agent.
10. Interest rate:
(a) Fixed Rate Notes:
i) interest rate
ii) overdue rate, if any
(a) Floating Rate Notes:
i) interest rate basis
ii) initial interest rate
iii) spread or spread multiplier, if any
iv) interest rate reset periods
v) interest payment dates
vi) index maturity
vii) maximum and minimum interest rates, if any
viii) record dates
ix) interest determination dates
x) overdue rate, if any
11. The date on or after which the Notes are redeemable at the
option of the Company, and additional redemption or repurchase
provisions, if any.
12. Wire transfer information.
13. Agent's commission (to be paid in the form of a discount from
the proceeds remitted to the Company upon settlement.
B. The Company will assign a CUSIP number to the Global Security
representing such Note and then advise the Trustee by telephone
(confirmed in writing at any time on the same date) or electronic
transmission of the information set forth in Settlement Procedure "A"
above, such CUSIP number and the name of such Agent. If the Company
rejects an offer, the Company will promptly notify the Agent and the
Trustee.
C. The Trustee will enter a pending deposit message through DTC's
Participant Terminal System, providing the following settlement
information to DTC, the Agent, Standard & Poor's Corporation and,
upon request, the Trustee under the Indenture pursuant to which such
Note is to be issued:
1. The information set forth in Settlement Procedure "A."
2. Identification as a Fixed Rate Book-Entry Note or a Floating
Rate Book-Entry Note.
3. Initial Interest Payment Date for such Note, number of days by
which such date succeeds the related "DTC Record Date" (which
term means the Regular Record Date except in the case of
floating rate notes which reset daily or weekly in which case
it
<PAGE> 43
B-15
means the date 5 calendar days immediately preceding the Interest
Payment Date) and amount of interest payable on such Interest Payment
Date.
4. Frequency of interest payments (monthly, semiannually,
quarterly, etc.).
5. CUSIP number of the Global Security representing such Note.
6. Whether such Global Security will represent any other
Book-Entry Note (to the extent known at such time).
D. The Trustee will complete and authenticate the note
certificate evidencing the Global Security representing such
Book-Entry Note.
E. DTC will credit such Note to the Trustee's participant account
at DTC.
F. The Trustee will enter an SDFS deliver order through DTC's
Participant Terminal System instructing DTC to (i) debit such Note to
the Trustee's participant account and credit such Note to the Agent's
participant account and (ii) debit the Agent's settlement account and
credit the Trustee's settlement account for an amount equal to the
price of such Note less the Agent's commission.
G. The Agent will enter an SDFS deliver order through DTC's
Participant Terminal System instructing DTC (i) to debit such Note to
the Agent's participant account and credit such Note to the
participant accounts of the Participants with respect to such Note and
(ii) to debit the settlement accounts of such Participants and credit
the settlement account of the Agent for an amount equal to the price
of such Note.
H. Transfers of funds in accordance with SDFS deliver orders
described in Settlement Procedures "F" and "G" will be settled in
accordance with SDFS operating procedures in effect on the settlement
date.
I. The Trustee will credit to an account of the Company
maintained at the Trustee funds available for immediate use in the
amount transferred to the Trustee in accordance with Settlement
Procedure "F."
J. The Agent will deliver to the purchaser a copy of the most
recent Prospectus applicable to the Note with or prior to any written
offer of Notes and the confirmation and payment by the purchaser of
the Note.
The Agent will confirm the purchase of such Note to the
purchaser either by transmitting to the Participants with respect to
such Note a confirmation order or orders through DTC's institutional
delivery system or by mailing a written confirmation to such
purchaser.
SETTLEMENT PROCEDURES TIMETABLE
For orders of Book-Entry Notes solicited by an Agent, as agent, and
accepted by the Company for settlement, Settlement Procedures "A" through "J"
set forth above shall be completed as soon as possible but not later than the
respective times (New York City time) set forth below:
<PAGE> 44
B-16
SETTLEMENT
PROCEDURES TIME
===========================================================
A-B 11:00 A.M. on the Sale date
C 2:00 P.M. on the Sale date
D 3:00 P.M. on date before Settlement date
E 10:00 A.M. on Settlement date
F-G 2:00 P.M. on Settlement date
H 4:45 P.M. on Settlement date
I-J 5:00 P.M. on Settlement date
If a sale is to be settled more than one Business Day after the sale
date, Settlement Procedures "A," "B" and "C" shall be completed as soon as
practicable but no later than 11:00 A.M. and 2:00 P.M., as the case may be, on
the first Business Day after the sale date. If the initial interest rate for a
Floating Rate Book-Entry Note has not been determined at the time that
Settlement Procedure "A" is completed, Settlement Procedures "B" and "C" shall
be completed as soon as such rate has been determined but no later than 11:00
A.M. and 12:00 Noon, respectively, on the second Business Day before the
settlement date. Settlement Procedure "I" is subject to extension in
accordance with any extension of Fedwire closing deadlines and in the other
events specified in the SDFS operating procedures in effect on the settlement
date.
If settlement of a Book-Entry Note is rescheduled or canceled, the
Trustee will deliver to DTC, through DTC's Participant Terminal System, a
cancellation message to such effect by no later than 2:00 P.M. on the Business
Day immediately preceding the scheduled settlement date.
FAILURE TO SETTLE
If the Trustee fails to enter an SDFS deliver order with respect to a
Book-Entry Note pursuant to Settlement Procedure "F," the Trustee may deliver
to DTC, through DTC's Participant Terminal System, as soon as practicable a
withdrawal message instructing DTC to debit such Note to the Trustee's
participant account. DTC will process the withdrawal message, provided that
the Trustee's participant account contains a principal amount of the Global
Security representing such Note that is at least equal to the principal amount
to be debited. If a withdrawal message is processed with respect to all the
Book-Entry Notes represented by a Global Security, the Trustee will mark such
Global Security "canceled," make appropriate entries in the Trustee's records
and send such canceled Global Security to the Company. The CUSIP number
assigned to such Global Security shall, in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately reassigned. If a withdrawal
message is processed with respect to one or more, but not all, of the
Book-Entry Notes represented by a Global Security, the Trustee will exchange
such Global Security for two Global Securities, one of which shall represent
such Book-Entry Note or Notes and shall be canceled immediately after issuance
and the other of which shall represent the other Book-Entry Notes previously
represented by the surrendered Global Security and shall bear the CUSIP number
of the surrendered Global Security.
<PAGE> 45
B-17
If the purchase price for any Book-Entry Note is not timely paid to
the Participants with respect to such Note by the beneficial purchaser thereof
(or a Person, including an indirect participant in DTC, acting on behalf of
such purchaser), such Participants and, in turn, the Agent for such Note may
enter SDFS deliver orders through DTC's Participant Terminal System reversing
the orders entered pursuant to Settlement Procedures "F" and "G," respectively.
Thereafter, the Trustee will deliver the withdrawal message and take the
related actions described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure to settle with respect
to a Book-Entry Note, DTC may take any actions in accordance with its SDFS
operating procedures then in effect. In the event of a failure to settle with
respect to one or more, but not all, of the Book- Entry Notes to have been
represented by a Global Security, the Trustee will provide, in accordance with
Settlement Procedure "D," for the authentication and issuance of a Global
Security representing the other Book-Entry Notes to have been represented by
such Global Security and will make appropriate entries in its records.
<PAGE> 46
EXHIBIT C
PURCHASE AGREEMENT
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
c/o Sun Communities, Inc.
31700 Middlebelt Road, Suite 145
Farmington Hills, Michigan 48334
Attention: Chief Financial Officer
The undersigned agrees to purchase the following principal amount of
the Notes described in the Distribution Agreement dated ________________, 1997
(as it may be supplemented or amended from time to time, the "Distribution
Agreement"):
PRINCIPAL AMOUNT: $ ___________
SPECIFIED CURRENCY:
DENOMINATED AND INDEXED CURRENCIES:
INTEREST RATE: ____%
DISCOUNT: ____% of Principal Amount
AGGREGATE PRICE TO BE PAID TO COM-
PANY (IN IMMEDIATELY AVAILABLE
FUNDS): $ __________
SETTLEMENT DATE:
OTHER TERMS:
[In the case of Notes issued in a foreign currency or currency unit,
unless otherwise specified below, settlement and payments of principal and
interest will be in U.S. dollars based on the highest bid quotation in The City
of New York received by the Exchange Rate Agent at approximately 11:00 A.M.,
New York City time, on the second Business Day preceding the applicable payment
date from three recognized foreign exchange dealers (one of which may be the
Exchange Rate Agent) for the purchase by the quoting dealer of the Specified
Currency for U.S. dollars for settlement on such payment date in the aggregate
amount of the Specified Currency payable to all holders of Notes denominated in
such Specified Currency electing to receive U.S. dollar payments and at which
the applicable dealer commits to execute a contract. If such bid quotations
are not available, payments will be made in the Specified Currency.]
Our obligation to purchase Notes hereunder is subject to the continued
accuracy of your representations and warranties contained in the Distribution
Agreement and to your performance and observance of all applicable covenants
and agreements contained therein, including, without limitation, your
obligations pursuant to Section 7 thereof. Our obligation hereunder is subject
to the further condition that we shall receive (a) the opinions required to be
delivered pursuant to Section 5(e) of the Distribution Agreement, (b) the
certificate required to be delivered pursuant to Section 5(f) of the
Distribution Agreement and (c) the letter referred to in Section 5(g) of the
Distribution Agreement, in each case dated as of the above Settlement Date.
Terms used but not otherwise defined herein have the meanings assigned to them
in the Distribution Agreement.
<PAGE> 47
C-2
In further consideration of our agreement hereunder, you agree that
between the date hereof and the above Settlement Date, you will not offer or
sell, or enter into any agreement to sell, any debt securities of Sun or the
Company, other than borrowings under the Company's revolving credit agreements
and lines of credit, the private placement of Company securities and issuances
of the Company's commercial paper, without our express written consent.
We may terminate this Agreement, immediately upon notice to you, at
any time prior to the Settlement Date, if prior thereto there shall have
occurred: (i) any change, or any development involving a prospective change,
in or affecting primarily the business, properties, condition (financial or
other), results of operations or prospects of the Company or the Company and
the Subsidiaries taken as a whole which materially impairs the investment
quality of the Notes; (ii) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange, the American Stock
Exchange or the over-the-counter market or the establishment of minimum prices
on such exchanges or such market by the Commission; (iii) a general moratorium
on commercial banking activities declared by Federal, Michigan, Maryland or New
York State authorities; (iv) any downgrading in the rating accorded the
Company's debt securities by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) of the Rules and
Regulations), or any public announcement that any such organization has under
surveillance or review its rating of any debt securities of the Company (other
than an announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (v) any outbreak or
escalation of major hostilities in which the United States is involved, any
declaration of war by Congress or any other substantial national calamity or
emergency; or (vi) any material adverse change in the existing financial,
political or economic conditions in the United States, or you are unable to
provide any of the opinions, certificates or letters referred to in the second
preceding paragraph. In the event of such termination, no party shall have any
liability to the other party hereto, except as provided in Sections 4, 7 and 13
of the Distribution Agreement.
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
LEHMAN BROTHERS INC.
By: ___________________________
Authorized Signatory
CONFIRMED AND ACCEPTED: , 19___
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
By: Sun Communities, Inc., its General Partner
By: ____________________________
Authorized Signatory
SUN COMMUNITIES, INC.
By: ________________________________
Authorized Signatory
<PAGE> 48
EXHIBIT D
[FOREIGN CURRENCY] [INDEXED NOTE]
AMENDMENT NO. ___
TO DISTRIBUTION AGREEMENT DATED __________, 1997, AS AMENDED
[Insert Title of Foreign Currency or, in the case of
Indexed Notes, the Denominated and Indexed
Currencies]
The undersigned hereby agree that for the purposes of the issue and
sale of Notes denominated in [title of currency or currency unit] (the
"Applicable Foreign Currency") [and indexed to [title of currency or currency
unit] (the "Indexed Currency")] pursuant to the Distribution Agreement, dated
_______________, 1997, as it may be amended (the "Distribution Agreement"), the
following additions and modifications shall be made to the Distribution
Agreement. The additions and modifications adopted hereby shall be of the same
effect for the sale under the Distribution Agreement of all Notes denominated
in the Applicable Foreign Currency [and indexed to the Indexed Currency],
whether offered on an agency or principal basis, but shall be of no effect with
respect to Notes denominated in any currency or currency unit other than the
Applicable Foreign Currency.
Except as otherwise expressly provided herein, all terms used herein
which are defined in the Distribution Agreement shall have the same meanings as
in the Distribution Agreement.
[Insert appropriate additions and modifications to the Distribution
Agreement, for example, to opinions of counsel, conditions to obligations and
settlement procedures, etc.]
Very truly yours,
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
By: Sun Communities, Inc., its General Partner
By: ___________________________________
Authorized Signatory
SUN COMMUNITIES, INC.
By: __________________________________________
Authorized Signatory
CONFIRMED AND ACCEPTED: , 19___
LEHMAN BROTHERS INC.
By: _________________________________
Authorized Signatory
<PAGE> 1
EXHIBIT 4.2
FIRST SUPPLEMENTAL INDENTURE
This First Supplemental Indenture is made as of this 20th day of August,
1997 by and among SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP, a Michigan
limited partnership (the "Company"), and BANKERS TRUST COMPANY, a New York
banking corporation (the "Trustee").
RECITALS
A. The Company, Sun Communities, Inc., a Maryland corporation ("Sun"), and
the Trustee entered into an Indenture dated as of April 24, 1996 (the
"Indenture").
B. Any capitalized term not defined herein shall have the meaning assigned
to it in the Indenture.
C. Section 901(9) of the Indenture provides that the Company and the
Trustee may amend the Indenture without notice to or consent of any Holders of
Securities with respect to matters or questions arising under the Indenture
which are not inconsistent with the provisions of the Indenture as long as such
provisions do not adversely affect the interests of the Holders of Securities
of any series or any related coupons in any material respect.
D. The Company has determined that the amendments described below will not
adversely affect the interests of the Holders of Securities of any series or
any related coupons in any material respect.
NOW, THEREFORE, the parties hereby agree as follows:
1. The following definition is added to Section 101 of the Indenture:
"Specified Currency" means the currency or composite currency in
which a particular Security is denominated, or, if such currency
or composite currency is no longer legal tender for the payment of
public and private debts, such other currency or composite
currency of the relevant country which is then legal tender for
the payment of such debts.
2. The following sentence is added to the end of the first paragraph of
Section 307 of the Indenture:
Notwithstanding the foregoing, a Holder of Ten Million and 00/100
Dollars ($10,000,000) (or, if the Specified Currency is other than
United States dollars, the equivalent thereof in such Specified
Currency) or more in aggregate principal amount of Registered
Securities (whether having identical or different terms and
provisions) will be entitled to receive interest payments, if any,
on any Interest Payment Date other than on the date of Maturity by
wire transfer of immediately available funds if appropriate wire
transfer instructions have been received in writing (in accordance with
the notice requirements contained in Section 105) by the Trustee
not less than 15 days prior to such Interest Payment Date. Any
such wire transfer instructions received by the Trustee shall
remain in effect until revoked by such Holder.
3. Except as modified herein, the Indenture remains unchanged, and, as
modified, continues in full force and effect.
<PAGE> 2
IN WITNESS WHEREOF, the undersigned have executed this First Supplemental
Indenture on the above date.
SUN COMMUNITIES OPERATING
LIMITED PARTNERSHIP, a Michigan
limited partnership
By: Sun Communities, Inc., a
Maryland corporation
By:
-----------------------------
Jeffrey P. Jorissen, Senior
Vice President, Treasurer,
Chief Financial Officer, and
Secretary
BANKERS TRUST COMPANY,
as Trustee
By:
------------------------------
Title:
ATTEST
By:
--------------------------
Title:
<PAGE> 1
EXHIBIT 4.3
[FACE OF NOTE]
THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF.
THIS NOTE MAY NOT BE TRANSFERRED TO, OR REGISTERED OR EXCHANGED FOR SECURITIES
REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE DEPOSITORY OR A NOMINEE
THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY SECURITY AUTHENTICATED AND
DELIVERED UPON REGISTRATION OF TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.(1)
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY (AS
DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.(1)
(1)This paragraph applies to global Notes only.
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
MEDIUM-TERM NOTE
(Fixed Rate)
REGISTERED REGISTERED
NO. FXR - [ ] PRINCIPAL AMOUNT
-------------
CUSIP NO. [ ] $[ ]
------------- ------------------
ORIGINAL ISSUE DATE:
INTEREST RATE: %
STATED MATURITY DATE:
INTEREST PAYMENT DATE(S):
[ ] and
------- -------
[ ] Other:
INITIAL REDEMPTION DATE:
INITIAL REDEMPTION PERCENTAGE: %
ANNUAL REDEMPTION PERCENTAGE REDUCTION: %
OPTIONAL REPAYMENT DATE(S):
REPAYMENT PRICE: %
[ ] CHECK IF A DISCOUNT NOTE
Issue Price: %
SPECIFIED CURRENCY: AUTHORIZED DENOMINATION:
[ ] United States dollars [ ] $1,000 and integral
[ ] Other: multiples thereof
[ ] Other:
<PAGE> 2
ISSUE PRICE: EXCHANGE RATE AGENT:
OTHER/ADDITIONAL PROVISIONS: ADDENDUM ATTACHED:
[ ] Yes
[ ] No
-2-
<PAGE> 3
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP, a limited partnership
organized and existing under the laws of the State of Michigan (hereinafter
called the "Company", which term includes any successor under the Indenture
hereinafter referred to), for value received, hereby promises to pay to , or
registered assigns, upon presentation, the principal sum of $ on the Stated
Maturity Date specified above (or any Redemption Date or Repayment Date, each
as defined on the reverse hereof or upon any declaration of acceleration; each
such Stated Maturity Date, Redemption Date, Repayment Date or declaration of
acceleration being hereinafter referred to as the "Maturity Date" with respect
to the principal repayable on such date), and to pay interest thereon, at the
Interest Rate per annum specified above, until the entire principal hereof is
paid or made available for payment. The Company will pay interest in arrears
on each Interest Payment Date, if any, specified above (each, an "Interest
Payment Date"), commencing with the first Interest Payment Date next succeeding
the Original Issue Date specified above, and on the Maturity Date; PROVIDED,
HOWEVER, that if the Original Issue Date occurs between a Record Date (as
defined below) and the next succeeding Interest Payment Date, interest payments
will commence on the second Interest Payment Date next succeeding the Original
Issue Date to the Holder of this Note on the Record Date with respect to such
second Interest Payment Date. Interest on this Note will be computed on the
basis of a 360-day year of twelve 30-day months. Any capitalized term not
defined herein shall have the meaning assigned to it in that certain Indenture
by and among the Company, Sun Communities, Inc., a Maryland corporation
("Sun"), and Bankers Trust Company, a New York banking corporation, dated as of
April 24, 1996, and amended pursuant to a First Supplemental Indenture dated as
of August 20, 1997.
Interest on this Note will accrue from, and including, the immediately
preceding Interest Payment Date to which interest has been paid or duly
provided for (or from, and including, the Original Issue Date if no interest
has been paid or duly provided for) to, but excluding, the applicable Interest
Payment Date or the Maturity Date, as the case may be (each, an "Interest
Period"). The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, subject to certain exceptions described
herein, be paid to the Person in whose name this Note (or one or more
predecessor Notes) is registered in the Security Register applicable to this
Note at the close of business on the fifteenth calendar day (whether or not a
Business Day, as defined below) immediately preceding such Interest Payment
Date (the "Record Date"); PROVIDED, HOWEVER, that interest payable on the
Maturity Date will be payable to the Person to whom the principal hereof and
premium, if any, hereon shall be payable. Any such interest not so punctually
paid or duly provided for ("Defaulted Interest") will forthwith cease to be
payable to the Holder on any Record Date, and shall be paid to the Person in
whose name this Note is registered in the Security Register applicable to this
Note at the close of business on a special record date (the "Special Record
Date") for the payment of such Defaulted Interest to be fixed by the Trustee
hereinafter referred to, notice whereof shall be given to the Holder of this
Note by the Trustee not less than 10 calendar days prior to such Special Record
Date or may be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which this Note may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided for in the Indenture.
Payments of principal of, premium, if any, and interest in respect of this
Note due on the Maturity Date will be made in immediately available funds upon
presentation and surrender of this Note (and, with respect to any applicable
Repayment Date, a duly completed election form as contemplated on the reverse
hereof) at the corporate trust office of the Trustee in the Borough of
Manhattan, The City of New York, or at such other paying agency in the Borough
of Manhattan, The City of New York which is maintained by the Trustee where
Notes may be presented for payment, registration of transfer or exchange, and
where notices to or demands upon the Company in respect of the Notes or the
Indenture may be made, as the Company may determine; PROVIDED, HOWEVER, that if
such payment is to be made in a Specified Currency other than United States
dollars as set forth below, such payment will be made by wire transfer of
immediately available funds to an account with a bank designated by the Holder
hereof at least 15 calendar days prior to the Maturity Date, provided that such
bank has appropriate facilities
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<PAGE> 4
therefor and that this Note (and, if applicable, a duly completed repayment
election form) is presented and surrendered at the aforementioned office of the
Trustee in time for the Trustee to make such payment in such funds in
accordance with its normal procedures. Payment of interest due on any Interest
Payment Date other than the Maturity Date will be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register maintained at the aforementioned office of the Trustee;
PROVIDED, HOWEVER, that a Holder of U.S. $10,000,000 (or, if the Specified
Currency specified above is other than United States dollars, the equivalent
thereof in the Specified Currency) or more in aggregate principal amount of
Notes (whether having identical or different terms and provisions) will be
entitled to receive interest payments on such Interest Payment Date by wire
transfer of immediately available funds if appropriate wire transfer
instructions have been received in writing by the Trustee not less than 15
calendar days prior to such Interest Payment Date. Any such wire transfer
instructions received by the Trustee shall remain in effect until revoked by
such Holder.
If any Interest Payment Date or the Maturity Date falls on a day that is
not a Business Day, the required payment of principal, premium, if any, and/or
interest shall be made on the next succeeding Business Day with the same force
and effect as if made on the date such payment was due, and no interest shall
accrue with respect to such payment for the period from and after such Interest
Payment Date or the Maturity Date, as the case may be, to the date of such
payment on the next succeeding Business Day.
As used herein, "Business Day" means any day, other than a Saturday or
Sunday, that is neither a legal holiday nor a day on which banking institutions
are authorized or required by law, regulation or executive order to close in
The City of New York; PROVIDED, HOWEVER, that if the Specified Currency is
other than United States dollars and any payment is to be made in the Specified
Currency in accordance with the provisions hereof, such day is also not a day
on which banking institutions are authorized or required by law, regulation or
executive order to close in the Principal Financial Center (as defined below)
of the country issuing the Specified Currency (or, in the case of European
Currency Units ("ECU"), is not a day that appears as an ECU non-settlement day
on the display designated as "ISDE" on the Reuter Monitor Money Rates Service
(or a day so designated by the ECU Banking Association) or, if ECU
non-settlement days do not appear on that page (and are not so designated), is
not a day on which payments in ECU cannot be settled in the international
interbank market). "Principal Financial Center" means the capital city of the
country issuing the Specified Currency (except as described in the immediately
preceding sentence with respect to ECUs) except that with respect to United
States dollars, Australian dollars, Canadian dollars, Deutsche marks, Dutch
guilders, Italian lire, Swiss francs and ECU's, the "Principal Financial
Center" shall be The City of New York, Sydney, Toronto, Frankfurt, Amsterdam,
Milan, Zurich and Luxembourg, respectively.
The Company is obligated to make payment of principal of, premium, if any,
and interest in respect of this Note in the Specified Currency (or, if the
Specified Currency is not at the time of such payment legal tender for the
payment of public and private debts, in such other coin or currency of the
country which issued the Specified Currency as at the time of such payment is
legal tender for the payment of such debts). If the Specified Currency is
other than United States dollars, any such amounts so payable by the Company
will be converted by the Exchange Rate Agent specified above into United States
dollars for payment to the Holder of this Note; PROVIDED, HOWEVER, that the
Holder of this Note may elect to receive such amounts in such Specified
Currency pursuant to the provisions set forth below.
If the Specified Currency is other than United States dollars and the
Holder of this Note shall not have duly made an election to receive all or a
specified portion of any payment of principal, premium, if any, and/or interest
in respect of this Note in the Specified Currency, any United States dollar
amount to be received by the Holder of this Note will be based on the highest
bid quotation in The City of New York received by the Exchange Rate Agent at
approximately 11:00 A.M., New York City time, on the second Business Day
preceding the applicable payment date from three recognized foreign exchange
dealers (one of whom may be
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<PAGE> 5
the Exchange Rate Agent) selected by the Exchange Rate Agent and approved by
the Company for the purchase by the quoting dealer of the Specified Currency
for United States dollars for settlement on such payment date in the aggregate
amount of the Specified Currency payable to all Holders of Notes scheduled to
receive United States dollar payments and at which the applicable dealer
commits to execute a contract. All currency exchange costs will be borne by
the Holder of this Note by deductions from such payments. If three such bid
quotations are not available, payments on this Note will be made in the
Specified Currency unless the Specified Currency is not available due to the
imposition of exchange controls or other circumstances beyond the control of
the Company.
If the Specified Currency is other than United States dollars, the Holder
of this Note may elect to receive all or a specified portion of any payment of
principal, premium, if any, and/or interest in respect of this Note in the
Specified Currency by submitting a written request for such payment to the
Trustee at its corporate trust office in The City of New York on or prior to
the applicable Record Date or at least 15 calendar days prior to the Maturity
Date, as the case may be. Such written request may be mailed or hand delivered
or sent by facsimile transmission. The Holder of this Note may elect to
receive all or a specified portion of all future payments in the Specified
Currency in respect of such principal, premium, if any, and/or interest and
need not file a separate election for each payment. Such election will remain
in effect until revoked by written notice to the Trustee, but written notice of
any such revocation must be received by the Trustee on or prior to the
applicable Record Date or at least 15 calendar days prior to the Maturity Date,
as the case may be.
If the Specified Currency is other than United States dollars or a
composite currency and the Holder of this Note shall have duly made an election
to receive all or a specified portion of any payment of principal, premium, if
any, and/or interest in respect of this Note in the Specified Currency and if
the Specified Currency is not available due to the imposition of exchange
controls or other circumstances beyond the control of the Company, the Company
will be entitled to satisfy its obligations to the Holder of this Note by
making such payment in United States dollars on the basis of the Market
Exchange Rate (as defined below) computed by the Exchange Rate Agent on the
second Business Day prior to such payment date or, if such Market Exchange Rate
is not then available, on the basis of the most recently available Market
Exchange Rate or as otherwise specified on the face hereof. The "Market
Exchange Rate" for the Specified Currency means the noon dollar buying rate in
The City of New York for cable transfers for the Specified Currency as
certified for customs purposes by (or if not so certified, as otherwise
determined by) the Federal Reserve Bank of New York. Any payment made under
such circumstances in United States dollars will not constitute an Event of
Default.
If the Specified Currency is a composite currency and the Holder of this
Note shall have duly made an election to receive all or a specified portion of
any payment of principal, premium, if any, and/or interest in respect of this
Note in the Specified Currency and if such composite currency is unavailable
due to the imposition of exchange controls or other circumstances beyond the
control of the Company, then the Company will be entitled to satisfy its
obligations to the Holder of this Note by making such payment in United States
dollars. The amount of each payment in United States dollars shall be
computed on the basis of the equivalent of the composite currency in United
States dollars. The component currencies of the composite currency for this
purpose (collectively, the "Component Currencies" and each, a "Component
Currency") shall be the currency amounts that were components of the composite
currency as of the last day on which the composite currency was used. The
equivalent of the composite currency in United States dollars shall be
calculated by aggregating the United States dollar equivalents of the Component
Currencies. The United States dollar equivalent of each of the Component
Currencies shall be determined by the Exchange Rate Agent on the basis of the
Market Exchange Rate on the second Business Day prior to such payment date or,
if such Market Exchange Rate is not then available, on the basis of the most
recently available Market Exchange Rate for each such Component Currency, or as
otherwise specified on the face hereof.
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<PAGE> 6
If the official unit of any Component Currency is altered by way of
combination or subdivision, the number of units of the currency as a Component
Currency shall be divided or multiplied in the same proportion. If two or more
Component Currencies are consolidated into a single currency, the amounts of
those currencies as Component Currencies shall be replaced by an amount in such
single currency equal to the sum of the amounts of the consolidated Component
Currencies expressed in such single currency. If any Component Currency is
divided into two or more currencies, the amount of the original Component
Currency shall be replaced by the amounts of such two or more currencies, the
sum of which shall be equal to the amount of the original Component Currency.
All determinations referred to above made by the Exchange Rate Agent shall
be at its sole discretion and shall, in the absence of manifest error, be
conclusive for all purposes and binding on the Holder of this Note.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof after the Trustee's Certificate of Authentication and, if
so specified above, in the Addendum hereto, which further provisions shall have
the same force and effect as if set forth on the face hereof.
Notwithstanding any provisions to the contrary contained herein, if the
face of this Note specifies that an Addendum is attached hereto or that
"Other/Additional Provisions" apply, this Note shall be subject to the terms
set forth in such Addendum or such "Other/Additional Provisions".
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH
ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE
SAME EFFECT AS IF SET FORTH IN THIS PLACE.
Unless the Certificate of Authentication hereon has been executed by or on
behalf of the Trustee by manual signature, this Note shall not be entitled to
any benefit under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
SUN COMMUNITIES OPERATING LIMITED
PARTNERSHIP
By: Sun Communities, Inc.
Its: General Partner
By:
-----------------------------
Name:
Title: [Chairman of the
Board, President, or
Senior Vice President]
Date: , 1997
----------------
ATTEST:
By:
-------------------------------
Name:
Title: Chief Financial Officer
[SEAL]
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<PAGE> 7
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
BANKERS TRUST COMPANY,
as Trustee
By: _______________________________ Date: _____________________ ,1997
Authorized Officer
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<PAGE> 8
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
MEDIUM-TERM NOTE
(FIXED RATE)
This Note is one of a duly authorized issue of securities of the Company
(hereinafter called the "Securities"), issued and to be issued in one or more
series under an Indenture (the "Indenture") among the Company, Sun, and Bankers
Trust Company, a banking corporation organized under the laws of the State of
New York, as Trustee (herein called the "Trustee", which term includes any
successor trustee under the Indenture with respect to the series of which this
Note is a part), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. This Note is one of the series of
Securities designated as "Medium-Term Notes Due Nine Months or More From Date
of Issue" (the "Notes"). All terms used but not defined in this Note or in an
Addendum hereto shall have the meanings assigned to such terms in the
Indenture.
This Note is issuable only in registered form without coupons in minimum
denominations of U.S. $1,000 and integral multiples thereof or the minimum
Authorized Denomination specified on the face hereof.
This Note will not be subject to any sinking fund and, unless otherwise
provided on the face hereof in accordance with the provisions of the following
two paragraphs, will not be redeemable or repayable prior to the Stated
Maturity Date.
This Note will be subject to redemption at the option of the Company on
any date on or after the Initial Redemption Date, if any, specified on the face
hereof, in whole or from time to time in part in increments of U.S. $1,000 or
the minimum Authorized Denomination (provided that any remaining principal
amount hereof shall be at least U.S. $1,000 or such minimum Authorized
Denomination), at the Redemption Price (as defined below), together with unpaid
interest accrued thereon to the date fixed for redemption (each, a "Redemption
Date"), on written notice given to the Holder of this Note no more than 60 nor
less than 30 calendar days prior to the Redemption Date and in accordance with
the provisions of the Indenture. If no Initial Redemption Date is set forth on
the face hereof, this Note may not be redeemed prior to Maturity. The
"Redemption Price", if any, shall initially be the Initial Redemption
Percentage specified on the face hereof, if any, multiplied by the unpaid
principal amount of this Note to be redeemed. The Initial Redemption
Percentage, if any, shall decline at each anniversary of the Initial Redemption
Date by the Annual Redemption Percentage Reduction, if any, specified on the
face hereof until the Redemption Price is 100% of the unpaid principal amount
to be redeemed. In the event of redemption of this Note in part only, a new
Note of like tenor for the unredeemed portion hereof and otherwise having the
same terms as this Note shall be issued in the name of the Holder hereof upon
the presentation and surrender hereof.
This Note will be subject to repayment by the Company at the option of the
Holder hereof on the Optional Repayment Date(s), if any, specified on the face
hereof, in whole or in part in increments of U.S. $1,000 or the minimum
Authorized Denomination (provided that any remaining principal amount hereof
shall be at least U.S. $1,000 or such minimum Authorized Denomination), at a
repayment price equal to 100% of the unpaid principal amount to be repaid,
together with unpaid interest accrued thereon to the date fixed for repayment
(each, a "Repayment Date"). If an Optional Repayment Date is not set forth on
the face hereof, this Note will not be repayable at the option of the Holder
hereof prior to Maturity. For this Note to be repaid, this Note must be
received, together with the form hereon entitled "Option to Elect Repayment"
duly completed, by the Trustee at its corporate trust office not more than 60
nor less than 30 calendar days prior to the Repayment Date. Exercise of such
repayment option by the
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<PAGE> 9
Holder hereof will be irrevocable. In the event of repayment of this Note
in part only, a new Note of like tenor for the unrepaid portion hereof and
otherwise having the same terms as this Note shall be issued in the name of the
Holder hereof upon the presentation and surrender hereof.
If this Note is a Discount Note as specified on the face hereof, the
amount payable to the Holder of this Note in the event of redemption, repayment
or acceleration of maturity will be equal to the sum of (1) the Issue Price, if
any, specified on the face hereof (increased by any accruals of the Discount,
as defined below) and, in the event of any redemption of this Note (if
applicable), multiplied by the Initial Redemption Percentage (as adjusted by
the Annual Redemption Percentage Reduction, if applicable), if any, and (2) any
unpaid interest on this Note accrued from the Original Issue Date to the
Redemption Date, Repayment Date or date of acceleration of maturity, as the
case may be. The difference between the Issue Price and 100% of the principal
amount of this Note is referred to herein as the "Discount".
For purposes of determining the amount of Discount that has accrued as of
any Redemption Date, Repayment Date or date of acceleration of maturity of this
Note, such Discount will be accrued so as to cause the yield on the Note to be
constant. The constant yield will be calculated using a 30-day month, 360-day
year convention, a compounding period that, except for the Initial Period (as
defined below), corresponds to the shortest period between Interest Payment
Dates (with ratable accruals within a compounding period), a coupon rate equal
to the initial interest rate applicable to this Note and an assumption that the
maturity of this Note will not be accelerated. If the period from the Original
Issue Date to the initial Interest Payment Date (the "Initial Period") is
shorter than the compounding period for this Note, a proportionate amount of
the yield for an entire compounding period will be accrued. If the Initial
Period is longer than the compounding period, then such period will be divided
into a regular compounding period and a short period, with the short period
being treated as provided in the preceding sentence.
If an Event of Default, shall occur and be continuing, the principal
amount of the Notes may be declared accelerated and thereupon become due and
payable in the manner, with the effect, and subject to the conditions provided
in the Indenture.
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Company on this Note and (b) certain restrictive
covenants and the related defaults and Events of Default applicable to the
Company, in each case, upon compliance by the Company with certain conditions
set forth in the Indenture, which provisions apply to this Note.
If any Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of, and Make-Whole Amount, if any, on
the Securities of this series may be declared due and payable in the manner and
with the effect provided in the Indenture.
As provided in and subject to the provisions of the Indenture, the Holder
of this Note shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy hereunder, unless (i) such Holder shall have previously given
written notice to the Trustee of a continuing Event of Default with respect to
the Securities of this series, (ii) the Holders of not less than 25% in
principal amount of the Securities of this series at the time Outstanding shall
have made written request to the Trustee to institute proceedings in respect of
such Event of Default as Trustee, (iii) such Holder or Holders have offered
reasonable indemnity to the Trustee against the costs, expenses and liabilities
to be incurred in compliance with such request, (iv) the Trustee shall have
failed to institute any such proceeding for 60 days after its receipt of such
notice, request and offer of indemnity, and (v) the Trustee shall not have
received from the Holders of a majority in principal amount of Securities of
this series at the time Outstanding a direction inconsistent with such request.
The foregoing shall not apply to any suit instituted by the Holder of this
Note for the enforcement of any payment of principal hereof (and Make-Whole
Amount, if any) or any interest thereon on or after the respective due dates
expressed herein.
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<PAGE> 10
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with
the consent of the Holders of not less than a majority in principal amount of
the Securities of each series at the time Outstanding affected thereby. The
Indenture also contains provisions permitting the Holders of at least a
majority in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holders of this Note shall be conclusive and binding
upon such Holder and upon all future Holders of this Note and of any Security
issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent or waiver is made upon
this Note.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, Make-Whole Amount, if any,
on, and interest on this Note at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note is registrable in the Security Register,
upon surrender of this Note for registration of transfer at the office or
agency of the Company in any Place of Payment where the principal of,
make-Whole Amount, if any, on, and interest on this Note are payable, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereon one or
more new Securities of this series, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or
transferees.
No service charge shall be made for any registration of transfer or
exchange of Securities of this series, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith. In no event shall the Company be required to pay any
Additional Amounts as contemplated by the Indenture.
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
No recourse under or upon any obligation, covenant or agreement contained
in the Indenture or in this Note, or because of any indebtedness evidenced
thereby or hereby, shall be had against any promoter, as such or, against any
past, present or future stockholder, partner, officer or director, as such, of
the Company or of any successor, either directly or through the Company or any
successor, under any rule of law, statute or constitutional provision or by the
enforcement of any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and released by the
acceptance of this Note by the Holder thereof and as part of the consideration
for the issue of the Securities of this series.
THE INDENTURE AND THE SECURITIES, INCLUDING THIS NOTE, SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused "CUSIP" numbers to
be printed on the Securities of this series as a convenience to the Holders of
such Securities. No representation is
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<PAGE> 11
made as to the correctness or accuracy of such CUSIP numbers as printed on the
Securities, and reliance may be placed only on the other identification numbers
printed hereon.
-11-
<PAGE> 12
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COMM - as tenants in common UNIF GIFT MIN ACT -
TEN ENT - as tenants by the entirety _______ Custodian ______
JT TEN - as joint tenants with right (Cust) (Minor)
of survivorship and not as Under Uniform Gifts to Minors
tenants in common Act _______________
(State)
Additional abbreviations may also be used though not in the above list.
_____________________________________________
Social Security or taxpayer I.D. or other identifying number of assignee.
______________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
________________________________________________________________________________
________________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ________________, attorney to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.
Dated: __________, 1997
______________________________
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<PAGE> 13
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the Company to
repay this Note (or portion hereof specified below) pursuant to its terms at a
price equal to 100% of the principal amount to be repaid, together with unpaid
interest accrued hereon to the Repayment Date, to the undersigned, at
_____________________________________
_____________________________________
_____________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee must receive at its corporate
trust office in the Borough of Manhattan, The City of New York, not more than
60 nor less than 30 calendar days prior to the Repayment Date, this Note with
this "Option to Elect Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be increments of U.S. $1,000 (or, if
the Specified Currency is other than United States dollars, the minimum
Authorized Denomination specified on the face hereof)) which the Holder elects
to have repaid and specify the denomination or denominations (which shall be an
Authorized Denomination) of the Notes to be issued to the Holder for the
portion of this Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being repaid).
Principal Amount
to be Repaid: $
____________________________________________________________
Date: Notice: The signature(s) on this Option to Elect Repayment
must correspond with the name(s) as written upon the face of
this Note in every particular, without alteration or
enlargement or any change whatsoever.
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<PAGE> 1
EXHIBIT 4.4
[FACE OF NOTE]
THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF.
THIS NOTE MAY NOT BE TRANSFERRED TO, OR REGISTERED OR EXCHANGED FOR SECURITIES
REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE DEPOSITORY OR A NOMINEE
THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY SECURITY AUTHENTICATED AND
DELIVERED UPON REGISTRATION OF TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.(1)
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY (AS
DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.(1)
(1)This paragraph applies to global Notes only.
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
MEDIUM-TERM NOTE
(Floating Rate)
REGISTERED REGISTERED
NO. FLR - [__________] PRINCIPAL AMOUNT
CUSIP NO. [__________] $[_____________]
ORIGINAL ISSUE DATE:
STATED MATURITY DATE:
INTEREST RATE BASIS OR BASES:
IF LIBOR: IF CMT RATE:
[ ]LIBOR Reuters Designated CMT Telerate Page:
[ ]LIBOR Telerate If Telerate Page 7052:
[ ]Designated LIBOR Currency: [ ]Weekly Average
[ ]Designated LIBOR Page: [ ]Monthly Average
[ ]Reuters Page: Designated CMT Maturity Index:
[ ]Telerate Page:
INITIAL INTEREST RATE: %
INITIAL INTEREST RESET DATE:
INTEREST RESET PERIOD:
INTEREST RESET DATE(S):
INTEREST PAYMENT DATE(S):
INDEX MATURITY:
SPREAD (PLUS OR MINUS):
-1-
<PAGE> 2
SPREAD MULTIPLIER:
MINIMUM INTEREST RATE: %
MAXIMUM INTEREST RATE: %
INITIAL REDEMPTION DATE:
INITIAL REDEMPTION PERCENTAGE: %
ANNUAL REDEMPTION PERCENTAGE REDUCTION: %
OPTIONAL REPAYMENT DATE(S):
REPAYMENT PRICE: %
<TABLE>
<CAPTION>
<S> <C>
INTEREST CALCULATION: DAY COUNT CONVENTION:
[ ] Regular Floating Rate Note [ ] 30/360 for the period
[ ] Floating Rate/Fixed Rate Note
from _____ to _____
Fixed Rate Commencement Date: [ ] Actual/360 for the period
Fixed Interest Rate: % from ________ to _______
[ ] Inverse Floating Rate Note [ ] Actual/Actual for the
period from
Fixed Interest Rate: % ________ to ________
[ ] Discount Note Issue Price: % Applicable Interest Rate
Basis:
SPECIFIED CURRENCY: AUTHORIZED DENOMINATION:
[ ] United States dollars [ ] $1,000 and integral
multiples thereof
[ ] Other: [ ] Other:
EXCHANGE RATE AGENT: ISSUE PRICE:
CALCULATION AGENT: AGENT'S DISCOUNT OR
COMMISSION:
ADDENDUM ATTACHED OTHER/ADDITIONAL PROVISIONS:
[ ] Yes
[ ] No
</TABLE>
-2-
<PAGE> 3
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP, a limited partnership
organized and existing under the laws of the State of Michigan (hereinafter
called the "Company", which term includes any successor under the Indenture
hereinafter referred to), for value received, hereby promises to pay to , or
registered assigns, upon presentation, the principal sum of $ on the Stated
Maturity Date specified above (or any Redemption Date or Repayment Date, each
as defined on the reverse hereof or upon any declaration of acceleration; each
such Stated Maturity Date, Redemption Date, Repayment Date or declaration of
acceleration being hereinafter referred to as the "Maturity Date" with respect
to the principal repayable on such date), and to pay interest thereon, at a
rate per annum equal to the Initial Interest Rate specified above until the
Initial Interest Reset Date specified above and thereafter at a rate determined
in accordance with the provisions specified above and on the reverse hereof
with respect to one or more Interest Rate Bases specified above until the
principal hereof is paid or duly made available for payment. The Company will
pay interest in arrears on each Interest Payment Date, if any, specified above
(each, an "Interest Payment Date"), commencing with the first Interest Payment
Date next succeeding the Original Issue Date specified above, and on the
Maturity Date; PROVIDED, HOWEVER, that if the Original Issue Date occurs
between a Record Date (as defined on the reverse hereof) and the next
succeeding Interest Payment Date, interest payments will commence on the second
Interest Payment Date next succeeding the Original Issue Date to the Holder of
this Note on the Record Date with respect to such second Interest Payment Date.
Any capitalized term not defined herein shall have the meaning assigned to it
in that certain Indenture by and among the Company, Sun Communities, Inc., a
Maryland corporation ("Sun"), and Bankers Trust Company, a New York banking
corporation, dated as of April 24, 1996, and amended pursuant to a First
Supplemental Indenture dated as of August 20, 1997.
Interest on this Note will accrue from, and including, the immediately
preceding Interest Payment Date to which interest has been paid or duly
provided for (or from, and including, the Original Issue Date if no interest
has been paid or duly provided for) to, but excluding, the applicable Interest
Payment Date or the Maturity Date, as the case may be (each, an "Interest
Period"). The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, subject to certain exceptions described
herein, be paid to the Person in whose name this Note (or one or more
predecessor Notes) is registered in the Security Register applicable to this
Note at the close of business on the fifteenth calendar day (whether or not a
Business Day, as defined below) immediately preceding such Interest Payment
Date (the "Record Date"); PROVIDED, HOWEVER, that interest payable on the
Maturity Date will be payable to the Person to whom the principal hereof and
premium, if any, hereon shall be payable. Any such interest not so punctually
paid or duly provided for ("Defaulted Interest") will forthwith cease to be
payable to the Holder on any Record Date, and shall be paid to the Person in
whose name this Note is registered in the Security Register applicable to this
Note at the close of business on a special record date (the "Special Record
Date") for the payment of such Defaulted Interest to be fixed by the Trustee
hereinafter referred to, notice whereof shall be given to the Holder of this
Note by the Trustee not less than 10 calendar days prior to such Special Record
Date or may be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which this Note may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided for in the Indenture.
Payments of principal of, premium, if any, and interest in respect of this
Note due on the Maturity Date will be made in immediately available funds upon
presentation and surrender of this Note (and, with respect to any applicable
Repayment Date, a duly completed election form as contemplated on the reverse
hereof) at the corporate trust office of the Trustee in the Borough of
Manhattan, The City of New York, or at such other paying agency in the Borough
of Manhattan, The City of New York which is maintained by the Trustee where
Notes may be presented for payment, registration of transfer or exchange, and
where notices to or demands upon the Company in respect of the Notes or the
Indenture may be made, as the Company may determine; PROVIDED, HOWEVER, that if
such payment is to be made in a Specified Currency other than United States
dollars as set forth below, such payment will be made by wire transfer of
-3-
<PAGE> 4
immediately available funds to an account with a bank designated by the Holder
hereof at least 15 calendar days prior to the Maturity Date, provided that such
bank has appropriate facilities therefor and that this Note (and, if
applicable, a duly completed repayment election form) is presented and
surrendered at the aforementioned office of the Trustee in time for the Trustee
to make such payment in such funds in accordance with its normal procedures.
Payment of interest due on any Interest Payment Date other than the Maturity
Date will be made by check mailed to the address of the Person entitled thereto
as such address shall appear in the Security Register maintained at the
aforementioned office of the Trustee; PROVIDED, HOWEVER, that a Holder of U.S.
$10,000,000 (or, if the Specified Currency specified above is other than United
States dollars, the equivalent thereof in the Specified Currency) or more in
aggregate principal amount of Notes (whether having identical or different
terms and provisions) will be entitled to receive interest payments on such
Interest Payment Date by wire transfer of immediately available funds if
appropriate wire transfer instructions have been received in writing by the
Trustee not less than 15 calendar days prior to such Interest Payment Date.
Any such wire transfer instructions received by the Trustee shall remain in
effect until revoked by such Holder.
If any Interest Payment Date other than the Maturity Date would otherwise
be a day that is not a Business Day, such Interest Payment Date shall be
postponed to the next succeeding Business Day, except that if LIBOR is an
applicable Interest Rate Basis and such Business Day falls in the next
succeeding calendar month, such Interest Payment Date shall be the immediately
preceding Business Day, and if the Maturity Date falls on a day that is not a
Business Day, the required payment of principal, premium, if any, and/or
interest shall be made on the next succeeding Business Day, each with the same
force and effect as if made on the date such payment was due, and no interest
shall accrue with respect to such payment for the period from and after such
Interest Payment Date or the Maturity Date, as the case may be, to the date of
such payment on the next succeeding Business Day.
The Company is obligated to make payment of principal of, premium, if any,
and interest in respect of this Note in the Specified Currency (or, if the
Specified Currency is not at the time of such payment legal tender for the
payment of public and private debts, in such other coin or currency of the
country which issued the Specified Currency as at the time of such payment is
legal tender for the payment of such debts). If the Specified Currency is
other than United States dollars, any such amounts so payable by the Company
will be converted by the Exchange Rate Agent specified above into United States
dollars for payment to the Holder of this Note; PROVIDED, HOWEVER, that the
Holder of this Note may elect to receive such amounts in such Specified
Currency pursuant to the provisions set forth below.
If the Specified Currency is other than United States dollars and the
Holder of this Note shall not have duly made an election to receive all or a
specified portion of any payment of principal, premium, if any, and/or interest
in respect of this Note in the Specified Currency, any United States dollar
amount to be received by the Holder of this Note will be based on the highest
bid quotation in The City of New York received by the Exchange Rate Agent at
approximately 11:00 A.M., New York City time, on the second Business Day
preceding the applicable payment date from three recognized foreign exchange
dealers (one of whom may be the Exchange Rate Agent) selected by the Exchange
Rate Agent and approved by the Company for the purchase by the quoting dealer
of the Specified Currency for United States dollars for settlement on such
payment date in the aggregate amount of the Specified Currency payable to all
Holders of Notes scheduled to receive United States dollar payments and at
which the applicable dealer commits to execute a contract. All currency
exchange costs will be borne by the Holder of this Note by deductions from such
payments. If three such bid quotations are not available, payments on this
Note will be made in the Specified Currency unless the Specified Currency is
not available due to the imposition of exchange controls or other circumstances
beyond the control of the Company.
If the Specified Currency is other than United States dollars, the Holder
of this Note may elect to receive all or a specified portion of any payment of
principal, premium, if any, and/or
-4-
<PAGE> 5
interest in respect of this Note in the Specified Currency by submitting a
written request for such payment to the Trustee at its corporate trust office in
The City of New York on or prior to the applicable Record Date or at least 15
calendar days prior to the Maturity Date, as the case may be. Such written
request may be mailed or hand delivered or sent by facsimile transmission. The
Holder of this Note may elect to receive all or a specified portion of all
future payments in the Specified Currency in respect of such principal, premium,
if any, and/or interest and need not file a separate election for each payment.
Such election will remain in effect until revoked by written notice to the
Trustee, but written notice of any such revocation must be received by the
Trustee on or prior to the applicable Record Date or at least 15 calendar days
prior to the Maturity Date, as the case may be.
If the Specified Currency is other than United States dollars or a
composite currency and the Holder of this Note shall have duly made an election
to receive all or a specified portion of any payment of principal, premium, if
any, and/or interest in respect of this Note in the Specified Currency and if
the Specified Currency is not available due to the imposition of exchange
controls or other circumstances beyond the control of the Company, the Company
will be entitled to satisfy its obligations to the Holder of this Note by
making such payment in United States dollars on the basis of the Market
Exchange Rate (as defined below) computed by the Exchange Rate Agent on the
second Business Day prior to such payment date or, if such Market Exchange Rate
is not then available, on the basis of the most recently available Market
Exchange Rate or as otherwise specified on the face hereof. The "Market
Exchange Rate" for the Specified Currency means the noon dollar buying rate in
The City of New York for cable transfers for the Specified Currency as
certified for customs purposes by (or if not so certified, as otherwise
determined by) the Federal Reserve Bank of New York. Any payment made under
such circumstances in United States dollars will not constitute an Event of
Default.
If the Specified Currency is a composite currency and the Holder of this
Note shall have duly made an election to receive all or a specified portion of
any payment of principal, premium, if any, and/or interest in respect of this
Note in the Specified Currency and if such composite currency is unavailable
due to the imposition of exchange controls or other circumstances beyond the
control of the Company, then the Company will be entitled to satisfy its
obligations to the Holder of this Note by making such payment in United States
dollars. The amount of each payment in United States dollars shall be
computed on the basis of the equivalent of the composite currency in United
States dollars. The component currencies of the composite currency for this
purpose (collectively, the "Component Currencies" and each, a "Component
Currency") shall be the currency amounts that were components of the composite
currency as of the last day on which the composite currency was used. The
equivalent of the composite currency in United States dollars shall be
calculated by aggregating the United States dollar equivalents of the Component
Currencies. The United States dollar equivalent of each of the Component
Currencies shall be determined by the Exchange Rate Agent on the basis of the
Market Exchange Rate on the second Business Day prior to such payment date or,
if such Market Exchange Rate is not then available, on the basis of the most
recently available Market Exchange Rate for each such Component Currency, or as
otherwise specified on the face hereof.
If the official unit of any Component Currency is altered by way of
combination or subdivision, the number of units of the currency as a Component
Currency shall be divided or multiplied in the same proportion. If two or more
Component Currencies are consolidated into a single currency, the amounts of
those currencies as Component Currencies shall be replaced by an amount in such
single currency equal to the sum of the amounts of the consolidated Component
Currencies expressed in such single currency. If any Component Currency is
divided into two or more currencies, the amount of the original Component
Currency shall be replaced by the amounts of such two or more currencies, the
sum of which shall be equal to the amount of the original Component Currency.
-5-
<PAGE> 6
All determinations referred to above made by the Exchange Rate Agent shall
be at its sole discretion and shall, in the absence of manifest error, be
conclusive for all purposes and binding on the Holder of this Note.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof after the Trustee's Certificate of Authentication and, if
so specified above, in the Addendum hereto, which further provisions shall have
the same force and effect as if set forth on the face hereof.
Notwithstanding any provisions to the contrary contained herein, if the
face of this Note specifies that an Addendum is attached hereto or that
"Other/Additional Provisions" apply, this Note shall be subject to the terms
set forth in such Addendum or such "Other/Additional Provisions".
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH
ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE
SAME EFFECT AS IF SET FORTH IN THIS PLACE.
Unless the Certificate of Authentication hereon has been executed by or on
behalf of the Trustee by manual signature, this Note shall not be entitled to
any benefit under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
SUN COMMUNITIES OPERATING
LIMITED PARTNERSHIP
By: Sun Communities, Inc.
Its: General Partner
By: ________________________________
Name:
Title: [Chairman of the
Board, President, or
Senior Vice President]
Date: ____________________, 1997
ATTEST:
By: __________________________________
Name:
Title: Chief Financial Officer
[SEAL]
-6-
<PAGE> 7
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
BANKERS TRUST COMPANY,
as Trustee
By: _______________________ Date:_____________,1997
Authorized Officer
-7-
<PAGE> 8
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
MEDIUM-TERM NOTE
(FLOATING RATE)
This Note is one of a duly authorized issue of securities of the Company
(hereinafter called the "Securities"), issued and to be issued in one or more
series under an Indenture (the "Indenture") among the Company, Sun, and Bankers
Trust Company, a banking corporation organized under the laws of the State of
New York, as Trustee (herein called the "Trustee", which term includes any
successor trustee under the Indenture with respect to the series of which this
Note is a part), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. This Note is one of the series of
Securities designated as "Medium-Term Notes Due Nine Months or More From Date
of Issue" (the "Notes"). All terms used but not defined in this Note or in an
Addendum hereto shall have the meanings assigned to such terms in the
Indenture.
This Note is issuable only in registered form without coupons in minimum
denominations of U.S. $1,000 and integral multiples thereof or the minimum
Authorized Denomination specified on the face hereof.
This Note will not be subject to any sinking fund and, unless otherwise
provided on the face hereof in accordance with the provisions of the following
two paragraphs, will not be redeemable or repayable prior to the Stated
Maturity Date.
This Note will be subject to redemption at the option of the Company on
any date on or after the Initial Redemption Date, if any, specified on the face
hereof, in whole or from time to time in part in increments of U.S. $1,000 or
the minimum Authorized Denomination (provided that any remaining principal
amount hereof shall be at least U.S. $1,000 or such minimum Authorized
Denomination), at the Redemption Price (as defined below), together with unpaid
interest accrued thereon to the date fixed for redemption (each, a "Redemption
Date"), on written notice given to the Holder of this Note no more than 60 nor
less than 30 calendar days prior to the Redemption Date and in accordance with
the provisions of the Indenture. If no Initial Redemption Date is set forth on
the face hereof, this Note may not be redeemed prior to Maturity. The
"Redemption Price", if any, shall initially be the Initial Redemption
Percentage specified on the face hereof, if any, multiplied by the unpaid
principal amount of this Note to be redeemed. The Initial Redemption
Percentage, if any, shall decline at each anniversary of the Initial Redemption
Date by the Annual Redemption Percentage Reduction, if any, specified on the
face hereof until the Redemption Price is 100% of the unpaid principal amount
to be redeemed. In the event of redemption of this Note in part only, a new
Note of like tenor for the unredeemed portion hereof and otherwise having the
same terms as this Note shall be issued in the name of the Holder hereof upon
the presentation and surrender hereof.
This Note will be subject to repayment by the Company at the option of the
Holder hereof on the Optional Repayment Date(s), if any, specified on the face
hereof, in whole or in part in increments of U.S. $1,000 or the minimum
Authorized Denomination (provided that any remaining principal amount hereof
shall be at least U.S. $1,000 or such minimum Authorized Denomination), at a
repayment price equal to 100% of the unpaid principal amount to be repaid,
together with unpaid interest accrued thereon to the date fixed for repayment
(each, a "Repayment Date"). If an Optional Repayment Date is not set forth on
the face hereof, this Note will not be repayable at the option of the Holder
hereof prior to Maturity. For this Note to be repaid, this Note must be
received, together with the form hereon entitled "Option to Elect Repayment"
duly completed, by the Trustee at its corporate trust office not more than 60
nor less than 30 calendar days prior to the Repayment Date. Exercise of such
repayment option by the
-8-
<PAGE> 9
Holder hereof will be irrevocable. In the event of repayment of this Note in
part only, a new Note of like tenor for the unrepaid portion hereof and
otherwise having the same terms as this Note shall be issued in the name of the
Holder hereof upon the presentation and surrender hereof.
If the Interest Calculation of this Note is specified on the face hereof
as a Discount Note, the amount payable to the Holder of this Note in the event
of redemption, repayment or acceleration of maturity of this Note will be equal
to the sum of (1) the Issue Price, if any, specified on the face hereof
(increased by any accruals of the Discount, as defined below) and, in the event
of any redemption of this Note (if applicable), multiplied by the Initial
Redemption Percentage (as adjusted by the Annual Redemption Percentage
Reduction, if applicable), if any, and (2) any unpaid interest on this Note
accrued from the Original Issue Date to the Redemption Date, Repayment Date or
date of acceleration of maturity, as the case may be. The difference between
the Issue Price and 100% of the principal amount of this Note is referred to
herein as the "Discount".
For purposes of determining the amount of Discount that has accrued as of
any Redemption Date, Repayment Date or date of acceleration of maturity of this
Note, such Discount will be accrued so as to cause the yield on the Note to be
constant. The constant yield will be calculated using a 30-day month, 360-day
year convention, a compounding period that, except for the Initial Period (as
defined below), corresponds to the shortest period between Interest Payment
Dates (with ratable accruals within a compounding period), a coupon rate equal
to the initial interest rate applicable to this Note and an assumption that the
maturity of this Note will not be accelerated. If the period from the Original
Issue Date to the initial Interest Payment Date (the "Initial Period") is
shorter than the compounding period for this Note, a proportionate amount of
the yield for an entire compounding period will be accrued. If the Initial
Period is longer than the compounding period, then such period will be divided
into a regular compounding period and a short period, with the short period
being treated as provided in the preceding sentence.
The interest rate borne by this Note will be determined as follows:
(i) Unless the Interest Calculation of this Note is
specified on the face hereof as a "Floating Rate/Fixed Rate Note"
or an "Inverse Floating Rate Note", or as having an Addendum
attached or having "Other/Additional Provisions" apply, in each
case relating to a different interest rate formula, this Note
shall be designated as a "Regular Floating Rate Note" and, except
as set forth below or on the face hereof, shall bear interest at
the rate determined by reference to the applicable Interest Rate
Basis or Bases (a) plus or minus the Spread, if any, and/or (b)
multiplied by the Spread Multiplier, if any, in each case as
specified on the face hereof. Commencing on the Initial Interest
Reset Date, the rate at which interest on this Note shall be
payable shall be reset as of each Interest Reset Date specified on
the face hereof; PROVIDED, HOWEVER, that the interest rate in
effect for the period, if any, from the Original Issue Date to the
Initial Interest Reset Date shall be the Initial Interest Rate.
(ii) If the Interest Calculation of this Note is specified
on the face hereof as a "Floating Rate/Fixed Rate Note", then,
except as set forth below or on the face hereof, this Note shall
bear interest at the rate determined by reference to the
applicable Interest Rate Basis or Bases (a) plus or minus the
Spread, if any, and/or (b) multiplied by the Spread Multiplier, if
any. Commencing on the Initial Interest Reset Date, the rate at
which interest on this Note shall be payable shall be reset as of
each Interest Reset Date; PROVIDED, HOWEVER, that (y) the interest
rate in effect for the period, if any, from the Original Issue
Date to the Initial Interest Reset Date shall be the Initial
Interest Rate and (z) the interest rate in effect for the period
commencing on the Fixed Rate Commencement Date specified on the
face hereof to the Maturity Date shall be the Fixed Interest Rate
-9-
<PAGE> 10
specified on the face hereof or, if no such Fixed Interest Rate is
specified, the interest rate in effect hereon on the day
immediately preceding the Fixed Rate Commencement Date.
(iii) If the Interest Calculation of this Note is specified
on the face hereof as an "Inverse Floating Rate Note", then,
except as set forth below or on the face hereof, this Note shall
bear interest at the Fixed Interest Rate minus the rate determined
by reference to the applicable Interest Rate Basis or Bases (a)
plus or minus the Spread, if any, and/or (b) multiplied by the
Spread Multiplier, if any; PROVIDED, HOWEVER, that, unless
otherwise specified on the face hereof, the interest rate hereon
shall not be less than zero. Commencing on the Initial Interest
Reset Date, the rate at which interest on this Note shall be
payable shall be reset as of each Interest Reset Date; PROVIDED,
HOWEVER, that the interest rate in effect for the period, if any,
from the Original Issue Date to the Initial Interest Reset Date
shall be the Initial Interest Rate.
Unless otherwise specified on the face hereof, the rate with respect to
each Interest Rate Basis will be determined in accordance with the applicable
provisions below. Except as set forth above or on the face hereof, the
interest rate in effect on each day shall be (i) if such day is an Interest
Reset Date, the interest rate determined as of the Interest Determination Date
(as defined below) immediately preceding such Interest Reset Date or (ii) if
such day is not an Interest Reset Date, the interest rate determined as of the
Interest Determination Date immediately preceding the most recent Interest
Reset Date.
If any Interest Reset Date would otherwise be a day that is not a Business
Day, such Interest Reset Date shall be postponed to the next succeeding
Business Day, except that if LIBOR is an applicable Interest Rate Basis and
such Business Day falls in the next succeeding calendar month, such Interest
Reset Date shall be the immediately preceding Business Day. In addition, if
the Treasury Rate is an applicable Interest Rate Basis and the Interest
Determination Date would otherwise fall on an Interest Reset Date, then such
Interest Reset Date will be postponed to the next succeeding Business Day.
As used herein, "Business Day" means any day, other than a Saturday or
Sunday, that is neither a legal holiday nor a day on which banking institutions
are authorized or required by law, regulation or executive order to close in
The City of New York; PROVIDED, HOWEVER, that if the Specified Currency is
other than United States dollars and any payment is to be made in the Specified
Currency in accordance with the provisions hereof, such day is also not a day
on which banking institutions are authorized or required by law, regulation or
executive order to close in the Principal Financial Center (as defined below)
of the country issuing the Specified Currency (or, in the case of European
Currency Units ("ECU"), is not a day that appears as an ECU non-settlement day
on the display designated as "ISDE" on the Reuter Monitor Money Rates Service
(or a day so designated by the ECU Banking Association) or, if ECU
non-settlement days do not appear on that page (and are not so designated), is
not a day on which payments in ECU cannot be settled in the international
interbank market); PROVIDED, FURTHER, that if LIBOR is an applicable Interest
Rate Basis on this Note, such day is also a London Business Day (as defined
below). "London Business Day" means any day on which dealings in the
Designated LIBOR Currency (as defined below) are transacted in the London
interbank market. "Principal Financial Center" means (i) the capital city of
the country issuing the Specified Currency (except as described above with
respect to ECUs) or (ii) the capital city of the country to which the
Designated LIBOR Currency, if applicable, relates (or, in the case of ECU,
Luxembourg), except, in each case, that with respect to United States dollars,
Canadian dollars, Australian dollars, Deutsche marks, Dutch guilders, Italian
lire, Swiss francs and ECUs, the "Principal Financial Center" shall be The City
of New York, Sydney, Toronto, Frankfurt, Amsterdam, Milan (solely in the case
of clause (i) above), Zurich and Luxembourg, respectively.
-10-
<PAGE> 11
The interest rate applicable to each Interest Reset Period (as specified
on the face hereof) commencing on the related Interest Reset Date will be the
rate determined by the Calculation Agent as of the applicable Interest
Determination Date and calculated on or prior to the Calculation Date (as
hereinafter defined), except with respect to LIBOR and the 11th District Cost
of Funds Rate, which will be calculated on such Interest Determination Date.
The "Interest Determination Date" with respect to the CD Rate, the CMT Rate,
the Commercial Paper Rate, the Federal Funds Rate, the Kenny Rate, and the
Prime Rate will be the second Business Day immediately preceding the applicable
Interest Reset Date; the "Interest Determination Date" with respect to the 11th
District Cost of Funds Rate shall be the last working day of the month
immediately preceding the applicable Interest Reset Date on which the Federal
Home Loan Bank of San Francisco (the "FHLB of San Francisco") publishes the
Index (as defined below); and the "Interest Determination Date" with respect to
LIBOR shall be the second London Business Day immediately preceding the
applicable Interest Reset Date, unless the Designated LIBOR Currency is British
pounds sterling, in which case the "Interest Determination Date" will be the
applicable Interest Reset Date. The "Interest Determination Date" with
respect to the Treasury Rate shall be the day in the week in which the
applicable Interest Reset Date falls on which day Treasury Bills (as defined
below) are normally auctioned (Treasury Bills are normally sold at an auction
held on Monday of each week, unless that day is a legal holiday, in which case
the auction is normally held on the following Tuesday, except that such auction
may be held on the preceding Friday); PROVIDED, HOWEVER, that if an auction is
held on the Friday of the week preceding the applicable Interest Reset Date,
the Interest Determination Date shall be such preceding Friday; PROVIDED,
FURTHER, that if the Interest Determination Date would otherwise fall on an
Interest Reset Date, then such Interest Reset Date shall be postponed to the
next succeeding Business Day. If the interest rate of this Note is determined
with reference to two or more Interest Rate Bases specified on the face hereof,
the "Interest Determination Date" pertaining to this Note shall be the most
recent Business Day which is at least two Business Days prior to the applicable
Interest Reset Date on which each Interest Rate Basis is determinable. Each
Interest Rate Basis shall be determined as of such date, and the applicable
interest rate shall take effect on the related Interest Reset Date.
CD RATE. If an Interest Rate Basis for this Note is specified on the
face hereof as the CD Rate, the CD Rate shall be determined as of the
applicable Interest Determination Date (a "CD Rate Interest Determination
Date") as the rate on such date for negotiable United States dollar
certificates of deposit having the Index Maturity specified on the face hereof
as published by the Board of Governors of the Federal Reserve System in
"Statistical Release H.15(5l9), Selected Interest Rates" or any successor
publication ("H.15 (519)") under the heading "CDs (Secondary Market)," or, if
not published by 3:00 P.M., New York City time, on the related Calculation Date
(as defined below), the rate on such CD Rate Interest Determination Date for
negotiable United States dollar certificates of deposit of the Index Maturity
as published by the Federal Reserve Bank of New York in its daily statistical
release "Composite 3:30 P.M. Quotations for U.S. Government Securities" or any
successor publication ("Composite Quotations") under the heading "Certificates
of Deposit." If such rate is not yet published in either H.15 (519) or
Composite Quotations by 3:00 P.M., New York City time, on the related
Calculation Date, then the CD Rate on such CD Rate Interest Determination Date
will be calculated by the Calculation Agent specified on the face hereof and
will be the arithmetic mean of the secondary market offered rates as of 10:00
A.M., New York City time, on such CD Rate Interest Determination Date, of three
leading nonbank dealers in negotiable United States dollar certificates of
deposit in The City of New York selected by the Calculation Agent after
consultation with the Company for negotiable United States dollar certificates
of deposit of major United States money market banks with a remaining maturity
closest to the Index Maturity in an amount that is representative for a single
transaction in that market at that time; PROVIDED, HOWEVER, that if the dealers
so selected by the Calculation Agent are not quoting as mentioned in this
sentence, the CD Rate determined as of such CD Rate Interest Determination Date
will be the CD Rate in effect on such CD Rate Interest Determination Date.
CMT RATE. If an Interest Rate Basis for this Note is specified on the
face hereof as the CMT Rate, the CMT Rate shall be determined as of the
applicable Interest Determination Date (a
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<PAGE> 12
"CMT Rate Interest Determination Date") as the rate displayed on the Designated
CMT Telerate Page under the caption "...Treasury Constant Maturities...Federal
Reserve Board Release H.15...Mondays Approximately 3:45 P.M.," under the column
for the Designated CMT Maturity Index (as defined below) for (i) if the
Designated CMT Telerate Page is 7055, the rate on such CMT Rate Interest
Determination Date and (ii) if the Designated CMT Telerate Page is 7052, the
weekly or monthly average, as applicable for the week or the month, as
applicable, ended immediately preceding the week or the month, as applicable, in
which the related CMT Rate Interest Determination Date occurs. If such rate is
no longer displayed on the relevant page or is not displayed by 3:00 P.M., New
York City time, on the related Calculation Date, then the CMT Rate for such CMT
Rate Interest Determination Date will be such treasury constant maturity rate
for the Designated CMT Maturity Index as published in the relevant H.15 (519).
If such rate is no longer published or is not published by 3:00 P.M., New York
City time, on the related Calculation Date, then the CMT Rate on such CMT Rate
Interest Determination Date will be such treasury constant maturity rate for
the Designated CMT Maturity Index (or other United States Treasury rate for the
Designated CMT Maturity Index) for the CMT Rate Interest Determination Date
with respect to such Interest Reset Date as may then be published by either the
Board of Governors of the Federal Reserve System or the United States
Department of the Treasury that the Calculation Agent determines to be
comparable to the rate formerly displayed on the Designated CMT Telerate Page
and published in the relevant H.15(519). If such information is not provided
by 3:00 P.M., New York City time, on the related Calculation Date, then the CMT
Rate on the CMT Rate Interest Determination Date will be calculated by the
Calculation Agent and will be a yield to maturity, based on the arithmetic mean
of the secondary market closing offer side prices as of approximately 3:30
P.M., New York City time, on such CMT Rate Interest Determination Date
reported, according to their written records, by three leading primary United
States government securities dealers in The City of New York (each, a
"Reference Dealer") selected by the Calculation Agent (from five such Reference
Dealers selected by the Calculation Agent after consultation with the Company
and eliminating the highest quotation (or, in the event of quotation equality,
one of the highest) and the lowest quotation (or, in the event of quotation
equality, one of the lowest)), for the most recently issued direct noncallable
fixed rate obligations of the United States ("Treasury Notes") with an original
maturity of approximately the Designated CMT Maturity Index and a remaining
term to maturity of not less than such Designated CMT Maturity Index minus one
year. If the Calculation Agent is unable to obtain three such Treasury Note
quotations, the CMT Rate on such CMT Rate Interest Determination Date will be
calculated by the Calculation Agent and will be a yield to maturity based on
the arithmetic mean of the secondary market closing offer side prices as of
approximately 3:30 P.M., New York City time, on such CMT Rate Interest
Determination Date of three Reference Dealers in The City of New York (from
five such Reference Dealers selected by the Calculation Agent after
consultation with the Company and eliminating the highest quotation (or, in the
event of quotation equality, one of the highest) and the lowest quotation (or,
in the event of quotation equality, one of the lowest)), for Treasury Notes
with an original maturity of the number of years that is the next highest to
the Designated CMT Maturity Index and a remaining term to maturity closest to
the Designated CMT Maturity Index and in an amount of at least $100 million.
If three or four (and not five) of such Reference Dealers are quoting as
described above, then the CMT Rate will be based on the arithmetic mean of the
offer prices obtained and neither the highest nor the lowest of such quotes
will be eliminated; PROVIDED, HOWEVER, that if fewer than three Reference
Dealers so selected by the Calculation Agent are quoting as mentioned herein,
the CMT Rate determined as of such CMT Rate Interest Determination Date will be
the CMT Rate in effect on such CMT Rate Interest Determination Date. If two
Treasury Notes with an original maturity as described in the second preceding
sentence have remaining terms to maturity equally close to the Designated CMT
Maturity Index, the Calculation Agent will obtain quotations for the Treasury
Note with the shorter remaining term to maturity.
"Designated CMT Telerate Page" means the display on the Dow Jones Telerate
Service (or any successor service) on the page specified on the face hereof (or
any other page as may replace such page on that service for the purpose of
displaying Treasury Constant Maturities as reported in H.15(519)) for the
purpose of displaying Treasury Constant Maturities as reported in H.15(519).
If
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<PAGE> 13
no such page is specified in the applicable Pricing Supplement, the
Designated CMT Telerate Page shall be 7052 for the most recent week.
"Designated CMT Maturity Index" means the original period to maturity of
the U.S. Treasury securities (either l, 2, 3, 5, 7, l0, 20 or 30 years)
specified on the face hereof with respect to which the CMT Rate will be
calculated or, if no such maturity is specified in the applicable Pricing
Supplement, the Designated CMT Maturity Index shall be 2 years.
COMMERCIAL PAPER RATE. If an Interest Rate Basis for this Note is
specified on the face hereof as the Commercial Paper Rate, the Commercial Paper
Rate shall be determined as of the applicable Interest Determination Date (a
"Commercial Paper Rate Interest Determination Date") as the Money Market Yield
(calculated as described below) on such date of the rate for commercial paper
having the Index Maturity as published by the Board of Governors of the Federal
Reserve System in H.15 (519) under the heading "Commercial Paper" or, if
unavailable, under such heading representing commercial paper issued by
non-financial entities whose bond rating is "AA" or the equivalent from a
nationally recognized statistical rating agency. In the event that such rate
is not published prior to 9:00 A.M., New York City time, on such Calculation
Date, then the Commercial Paper Rate on such Commercial Paper Rate Interest
Determination Date will be the Money Market Yield of the rate for commercial
paper having the Index Maturity as published by the Federal Reserve Bank of New
York in its daily statistical release "Composite 3:30 P.M. Quotations for U.S.
Government Securities" or any successor publication ("Composite Quotations")
under the heading "Commercial Paper." If such rate is not yet published in
either H.15 (519) or Composite Quotations by 3:00 P.M., New York City time, on
such Calculation Date, then the Commercial Paper Rate on such Commercial Paper
Rate Interest Determination Date will be calculated by the Calculation Agent
and will be the Money Market Yield of the arithmetic mean of the offered rates
as of 11:00 A.M., New York City time, on such Commercial Paper Rate Interest
Determination Date of three leading dealers of commercial paper in The City of
New York selected by the Calculation Agent for commercial paper having the
Index Maturity specified in the applicable Pricing Supplement placed for an
industrial issuer whose bond rating is "AA," or the equivalent, from a
nationally recognized statistical rating organization; PROVIDED, HOWEVER, that
if the dealers so selected by the Calculation Agent after consultation with the
Company are not quoting as mentioned in this sentence, the Commercial Paper
Rate determined as of such Commercial Paper Rate Interest Determination Date
will be the Commercial Paper Rate in effect immediately prior to such
Commercial Paper Rate Interest Determination Date.
"Money Market Yield" shall be a yield (expressed as a percentage, rounded,
if necessary, to the nearest one hundred-thousandth of a percent) calculated in
accordance with the following formula:
Money Market Yield = Dx360 x 100
-------------
360 - (DxM)
where "D" refers to the per annum rate for commercial paper, quoted on a bank
discount basis and expressed as a decimal; and "M" refers to the actual number
of days in the period for which accrued interest is being calculated.
11TH DISTRICT COST OF FUNDS RATE. If an Interest Rate Basis for this Note
is specified on the face hereof as the 11th District Cost of Funds Rate, the
11th District Cost of Funds Rate shall be determined as of the applicable
Interest Determination Date (a "11th District Cost of Funds Rate Interest
Determination Date") as the rate equal to the monthly weighted average cost of
funds for the calendar month immediately preceding the month in which such 11th
District Cost of Funds Rate Interest Determination Date falls, as set forth
under the caption "11th District" on Telerate Page 7058 as of 11:00 A.M., San
Francisco time, on such 11th District Cost of Funds Rate Interest Determination
Date. If such rate does not appear on Telerate Page 7058 on such 11th District
Cost of Funds Rate Interest Determination Date, then the 11th District Cost of
Funds Rate on such 11th District Cost of Funds Rate Interest Determination Date
shall be the monthly weighted
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<PAGE> 14
average cost of funds paid by member institutions of the Eleventh Federal Home
Loan Bank District that was most recently announced (the "Index") by the FHLB of
San Francisco as such cost of funds for the calendar month immediately preceding
such 11th District Cost of Funds Rate Interest Determination Date. If the FHLB
of San Francisco fails to announce the Index on or prior to such 11th District
Cost of Funds Rate Interest Determination Date for the calendar month
immediately preceding such 11th District Cost of Funds Rate Interest
Determination Date, the 11th District Cost of Funds Rate determined as of such
11th District Cost of Funds Rate Interest Determination Date will be the 11th
District Cost of Funds Rate in effect on such 11th District Cost of Funds Rate
Interest Determination Date.
FEDERAL FUNDS RATE. If an Interest Rate Basis for this Note is specified
on the face hereof as the Federal Funds Rate, the Federal Funds Rate shall be
determined as of the applicable Interest Determination Date (a "Federal Funds
Rate Interest Determination Date") as the rate on such date for United States
dollar federal funds as published in H.15 (519) under the heading "Federal
Funds (Effective)" or, if not published by 9:00 A.M., New York City time, on
the related Calculation Date, the rate on such Federal Funds Rate Interest
Determination Date as published in Composite Quotations under the heading
"Federal Funds/Effective Rate." If such rate is not published in either H.15
(519) or Composite Quotations by 3:00 P.M., New York City time, on the related
Calculation Date, then the Federal Funds Rate on such Federal Funds Rate
Interest Determination Date will be calculated by the Calculation Agent and
will be the arithmetic mean (each as rounded, if necessary, to the nearest one
hundred-thousandth of a percent) of the rates for the last transaction in
overnight United States dollar federal funds arranged by three leading brokers
of federal funds transactions in The City of New York selected by the
Calculation Agent after consultation with the Company prior to 9:00 A.M., New
York City time, on such Federal Funds Rate Interest Determination Date;
PROVIDED, HOWEVER, that if the brokers so selected by the Calculation Agent are
not quoting as mentioned in this sentence, the Federal Funds Rate determined as
of such Federal Funds Rate Interest Determination Date will be the Federal
Funds Rate in effect on such Federal Funds Rate Interest Determination Date.
LIBOR. If an Interest Rate Basis for this Note is specified on the face
hereof as LIBOR, LIBOR shall be determined as of the applicable Interest
Determination Date in accordance with the following provisions:
(i) if (a) "LIBOR Reuters" is specified on the face hereof, the
arithmetic mean of the offered rates (unless the Designated LIBOR Page
(as defined below) by its terms provides only for a single rate, in which
case such single rate shall be used) for deposits in the Designated LIBOR
Currency having the Index Maturity, commencing on the applicable Interest
Reset Date, that appear (or, if only a single rate is required as
aforesaid, appears) on the Designated LIBOR Page as of 11:00 A.M., London
time, on such LIBOR Interest Determination Date, or (b) if "LIBOR
Telerate" is specified on the face hereof, or if neither "LIBOR Reuters"
nor "LIBOR Telerate" is specified on the face hereof as the method for
calculating LIBOR, the rate for deposits in the Designated LIBOR Currency
having the Index Maturity, commencing on the applicable Interest Reset
Date, that appears on the Designated LIBOR Page as of 11:00 A.M., London
time, on such LIBOR Interest Determination Date. If fewer than two such
offered rates so appear, or if no such rate so appears, as applicable,
LIBOR on such LIBOR Interest Determination Date will be determined in
accordance with the provisions described in clause (ii) below.
(ii) With respect to a LIBOR Interest Determination Date on which
fewer than two offered rates appear, or no rate appears, as the case may
be, on the Designated LIBOR Page as specified in clause (i) above, the
Calculation Agent will request the principal London offices of each of
four major reference banks in the London interbank market, as selected by
the Calculation Agent after consultation with the Company, to provide the
Calculation Agent with its offered quotation for deposits in the
Designated LIBOR Currency for the period of the Index Maturity,
commencing on the applicable Interest Reset Date, to prime banks in the
London interbank market at approximately 11:00 A.M., London
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<PAGE> 15
time, on such LIBOR Interest Determination Date and in a principal
amount that is representative for a single transaction in the Designated
LIBOR Currency in such market at such time. If at least two such
quotations are so provided, then LIBOR on such LIBOR Interest
Determination Date will be the arithmetic mean of such quotations. If
fewer than two such quotations are so provided, then LIBOR on such LIBOR
Interest Determination Date will be the arithmetic mean of the rates
quoted at approximately 11:00 A.M., in the applicable Principal Financial
Center, on such LIBOR Interest Determination Date by three major banks in
such Principal Financial Center selected by the Calculation Agent after
consultation with the Company for loans in the Designated LIBOR Currency
to leading European banks, having the Index Maturity and in a principal
amount that is representative for a single transaction in the Designated
LIBOR Currency in such market at such time; PROVIDED, HOWEVER, that if the
banks so selected by the Calculation Agent are not quoting as mentioned in
this sentence, LIBOR determined as of such LIBOR Interest Determination
Date will be LIBOR in effect on such LIBOR Interest Determination Date.
"Designated LIBOR Currency" means the currency or composite currency
specified on the face hereof as to which LIBOR shall be calculated or, if no
such currency or composite currency is specified on the face hereof, the
Designated LIBOR Currency shall be United States dollars.
"Designated LIBOR Page" means (a) if "LIBOR Reuters" is specified on the
face hereof, the display on the Reuters Monitor Money Rates Service (or any
successor service) on the page specified on the face hereof (or any other page
as may replace such page on such service) for the purpose of displaying the
London interbank rates of major banks for the Designated LIBOR Currency, or (b)
if "LIBOR Telerate" is specified on the face hereof or neither "LIBOR Reuters"
nor "LIBOR Telerate" is specified on the face hereof as the method for
calculating LIBOR, the display on the Dow Jones Telerate Service (or any
successor service) on the page specified on the face hereof (or any other page
as may replace such page on such service) for the purpose of displaying the
London interbank rates of major banks for the Designated LIBOR Currency.
KENNY RATE. If an Interest Rate Basis for this Note is specified on the
face hereof as the Kenny Rate, the Kenny Rate shall be determined as of the
applicable Interest Determination Date (a "Kenny Rate Interest Determination
Date") as the rate equal to the high grade weekly index (the "Weekly Index") on
such date made available by Kenny Information Systems ("Kenny") to the
Calculation Agent. The Weekly Index is, and shall be, based upon 30 day yield
evaluations at par of bonds, the interest on which is exempt from Federal
income taxation under the Internal Revenue Code of 1986, as amended (the
"Code"), of not less than five high grade component issuers selected by Kenny
which shall include, without limitation, issuers of general obligation bonds.
The specific issuers included among the component issuers may be changed from
time to time by Kenny in its discretion. The bonds on which the Weekly Index
is based shall not include any bonds on which the interest is subject to a
minimum tax or similar tax under the Code, unless all tax-exempt bonds are
subject to such tax. In the event Kenny ceases to make available such Weekly
Index, a successor indexing agent will be selected by the Calculation Agent,
such index to reflect the prevailing rate for bonds rated in the highest
short-term rating category by Moody's Investors Service, Inc. and Standard &
Poor's Corporation in respect of issuers most closely resembling the high grade
component issuers selected by Kenny for its Weekly Index, the interest on which
is (A) variable on a weekly basis, (B) exempt from Federal income taxation
under the Code, and (C) not subject to a minimum tax or similar tax under the
Code, unless all tax-exempt bonds are subject to such tax. If such successor
indexing agent is not available, the rate for any Kenny Rate Interest
Determination Date shall be 67% of the rate determined if the Treasury Rate
option had been originally selected.
PRIME RATE. If an Interest Rate Basis for this Note is specified on the
face hereof as the Prime Rate, the Prime Rate shall be determined as of the
applicable Interest Determination Date (a "Prime Rate Interest Determination
Date") as the rate equal to the rate on such date as such rate is published in
H.15(5l9) under the heading "Bank Prime Loan." If such rate is not published
prior to 3:00 P.M., New York City time, on the related Calculation Date, then
the Prime Rate shall be the
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<PAGE> 16
arithmetic mean of the rates of interest publicly announced by each bank that
appears on the Reuters Screen USPRIME1 Page (as hereinafter defined) as such
bank's prime rate or base lending rate as in effect for such Prime Rate Interest
Determination Date. If fewer than four such rates appear on the Reuters Screen
USPRIME1 Page for such Prime Rate Interest Determination Date, then the Prime
Rate shall be the arithmetic mean of the prime rates or base lending rates
quoted on the basis of the actual number of days in the year divided by a
360-day year as of the close of business on such Prime Rate Interest
Determination Date by four major money center banks in The City of New York
selected by the Calculation Agent after consultation with the Company. If fewer
than four such quotations are so provided, then the Prime Rate shall be the
arithmetic mean of four prime rates quoted on the basis of the actual number of
days in the year divided by a 360-day year as of the close of business on such
Prime Rate Interest Determination Date as furnished in The City of New York by
the major money center banks, if any, that have provided such quotations and by
a reasonable number of substitute banks or trust companies necessary in order to
obtain four such prime rate quotations, provided such substitute banks or trust
companies are organized and doing business under the laws of the United States,
or any State thereof, each having total equity capital of at least $500 million
and being subject to supervision or examination by Federal or State authority,
selected by the Calculation Agent after consultation with the Company to
provide such rate or rates; PROVIDED, HOWEVER, that if the banks or trust
companies so selected by the Calculation Agent are not quoting as mentioned in
this sentence, the Prime Rate determined as of such Prime Rate Interest
Determination Date will be the Prime Rate in effect on such Prime Rate Interest
Determination Date.
"Reuters Screen USPRIME1 Page" means the display on the Reuters Monitor
Money Rates Service (or any successor service) on the "USPRIMEl" page (or such
other page as may replace the USPRIMEl page on such service) for the purpose of
displaying prime rates or base lending rates of major United States banks.
TREASURY RATE. If an Interest Rate Basis for this Note is specified on
the face hereof as the Treasury Rate, the Treasury Rate shall be determined as
of the applicable Interest Determination Date (a "Treasury Rate Interest
Determination Date") as the rate from the auction held on such Treasury Rate
Interest Determination Date (the "Auction") of direct obligations of the United
States ("Treasury Bills") having the Index Maturity, as such rate is published
in H.15(519) under the heading "Treasury Bills - auction average (investment)"
or, if not published by 3:00 P.M.. New York City time, on the related
Calculation Date, the auction average rate of such Treasury Bills (expressed as
a bond equivalent on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) as otherwise announced by the United States
Department of the Treasury. In the event that the results of the Auction of
Treasury Bills having the Index Maturity are not reported as provided by 3:00
P.M., New York City time, on the related Calculation Date, or if no such
Auction is held, then the Treasury Rate will be calculated by the Calculation
Agent and will be a yield to maturity (expressed as a bond equivalent on the
basis of a year of 365 or 366 days, as applicable, and applied on a daily
basis) of the arithmetic mean of the secondary market bid rates, as of
approximately 3:30 P.M., New York City time, on such Treasury Rate Interest
Determination Date, of three leading primary United States government
securities dealers selected by the Calculation Agent after consultation with
the Company, for the issue of Treasury Bills with a remaining maturity closest
to the Index Maturity; PROVIDED, HOWEVER, that if the dealers so selected by
the Calculation Agent are not quoting as mentioned in this sentence, the
Treasury Rate determined as of such Treasury Rate Interest Determination Date
will be the Treasury Rate in effect on such Treasury Rate Interest
Determination Date.
If an Event of Default, shall occur and be continuing, the principal amount of
the Notes may be declared accelerated and thereupon become due and payable in
the manner, with the effect, and subject to the conditions provided in the
Indenture.
Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, in each case as specified on the face hereof. The
interest rate on this Note will in no event be higher than the
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<PAGE> 17
maximum rate permitted by New York law, as the same may be modified by United
States law of general application.
The Calculation Agent shall calculate the interest rate hereon on or
before each Calculation Date. The "Calculation Date", if applicable,
pertaining to any Interest Determination Date shall be the earlier of (i) the
tenth calendar day after such Interest Determination Date or, if such day is
not a Business Day, the next succeeding Business Day or (ii) the Business Day
immediately preceding the applicable Interest Payment Date or the Maturity
Date, as the case may be. At the request of the Holder hereof, the Calculation
Agent will provide to the Holder hereof the interest rate hereon then in effect
and, if determined, the interest rate that will become effective as a result of
a determination made for the next succeeding Interest Reset Date.
Accrued interest hereon shall be an amount calculated by multiplying the
principal amount hereof by an accrued interest factor. Such accrued interest
factor shall be computed by adding the interest factor calculated for each day
in the applicable Interest Period. Unless otherwise specified as the Day Count
Convention on the face hereof, the interest factor for each such date shall be
computed by dividing the interest rate applicable to such day by 360 if the CD
Rate, the Commercial Paper Rate, the 11th District Cost of Funds Rate, the
Federal Funds Rate, LIBOR, or the Prime Rate is an applicable Interest Rate
Basis, or by the actual number of days in the year if the CMT Rate or the
Treasury Rate is an applicable Interest Rate Basis, or by 365 if the Kenny Rate
is an applicable Interest Rate Basis. Unless otherwise specified as the Day
Count Convention on the face hereof, the interest factor for this Note, if the
interest rate is calculated with reference to two or more Interest Rate Bases,
shall be calculated in each period in the same manner as if only the applicable
Interest Rate Basis specified on the face hereof applied.
All percentages resulting from any calculation on this Note shall be
rounded to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards, and all amounts used in
or resulting from such calculation on this Note shall be rounded, in the case
of United States dollars, to the nearest cent or, in the case of a Specified
Currency other than United States dollars, to the nearest unit (with one-half
cent or unit being rounded upwards).
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Company on this Note and (b) certain restrictive
covenants and the related defaults and Events of Default applicable to the
Company, in each case, upon compliance by the Company with certain conditions
set forth in the Indenture, which provisions apply to this Note.
If any Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of, and Make-Whole Amount, if any, on
the Securities of this series may be declared due and payable in the manner and
with the effect provided in the Indenture.
As provided in and subject to the provisions of the Indenture, the Holder
of this Note shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy hereunder, unless (i) such Holder shall have previously given
written notice to the Trustee of a continuing Event of Default with respect to
the Securities of this series, (ii) the Holders of not less than 25% in
principal amount of the Securities of this series at the time Outstanding shall
have made written request to the Trustee to institute proceedings in respect of
such Event of Default as Trustee, (iii) such Holder or Holders have offered
reasonable indemnity to the Trustee against the costs, expenses and liabilities
to be incurred in compliance with such request, (iv) the Trustee shall have
failed to institute any such proceeding for 60 days after its receipt of such
notice, request and offer of indemnity, and (v) the Trustee shall not have
received from the Holders of a majority in principal amount of Securities of
this series at the time Outstanding a direction inconsistent with such request.
The foregoing shall not apply to any suit instituted by the Holder of this
Note for the enforcement of any payment of principal hereof (and Make-Whole
Amount, if any) or any interest thereon on or after the respective due dates
expressed herein.
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<PAGE> 18
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with
the consent of the Holders of not less than a majority in principal amount of
the Securities of each series at the time Outstanding affected thereby. The
Indenture also contains provisions permitting the Holders of at least a
majority in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holders of this Note shall be conclusive and binding
upon such Holder and upon all future Holders of this Note and of any Security
issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent or waiver is made upon
this Note.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, Make-Whole Amount, if any,
on, and interest on this Note at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note is registrable in the Security Register,
upon surrender of this Note for registration of transfer at the office or
agency of the Company in any Place of Payment where the principal of,
make-Whole Amount, if any, on, and interest on this Note are payable, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereon one or
more new Securities of this series, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or
transferees.
No service charge shall be made for any registration of transfer or
exchange of Securities of this series, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith. In no event shall the Company be required to pay any
Additional Amounts as contemplated by the Indenture.
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
No recourse under or upon any obligation, covenant or agreement contained
in the Indenture or in this Note, or because of any indebtedness evidenced
thereby or hereby, shall be had against any promoter, as such or, against any
past, present or future stockholder, partner, officer or director, as such, of
the Company or of any successor, either directly or through the Company or any
successor, under any rule of law, statute or constitutional provision or by the
enforcement of any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and released by the
acceptance of this Note by the Holder thereof and as part of the consideration
for the issue of the Securities of this series.
THE INDENTURE AND THE SECURITIES, INCLUDING THIS NOTE, SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused "CUSIP" numbers to
be printed on the Securities of this series as a convenience to the Holders of
such Securities. No representation is
-18-
<PAGE> 19
made as to the correctness or accuracy of such CUSIP numbers as printed on the
Securities, and reliance may be placed only on the other identification numbers
printed hereon.
-19-
<PAGE> 20
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COMM - as tenants in common UNIF GIFT MIN ACT -
TEN ENT - as tenants by the entirety _______ Custodian ______
JT TEN - as joint tenants with right (Cust) (Minor)
of survivorship and not as Under Uniform Gifts to Minors
tenants in common Act _______________
(State)
Additional abbreviations may also be used though not in the above list.
_____________________________________________
Social Security or taxpayer I.D. or other identifying number of assignee.
______________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
_______________________________________________________________________________
_______________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ________________, attorney to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.
Dated: , 1997
_____________________________________
-20-
<PAGE> 21
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the Company to
repay this Note (or portion hereof specified below) pursuant to its terms at a
price equal to 100% of the principal amount to be repaid, together with unpaid
interest accrued hereon to the Repayment Date, to the undersigned, at
__________________________________
__________________________________
__________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee must receive at its corporate
trust office in the Borough of Manhattan, The City of New York, not more than
60 nor less than 30 calendar days prior to the Repayment Date, this Note with
this "Option to Elect Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be increments of U.S. $1,000 (or, if
the Specified Currency is other than United States dollars, the minimum
Authorized Denomination specified on the face hereof)) which the Holder elects
to have repaid and specify the denomination or denominations (which shall be an
Authorized Denomination) of the Notes to be issued to the Holder for the
portion of this Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being repaid).
Principal Amount
to be Repaid: $
_________________________________________________________
Date: Notice: The signature(s) on this Option to Elect Repayment
must correspond with the name(s) as written upon the face
of this Note in every particular, without alteration or
enlargement or any change whatsoever.
-21-
<PAGE> 1
EXHIBIT 5.1
[JAFFE, RAITT, HEUER & WEISS LETTERHEAD]
August 20, 1997
Sun Communities Operating Limited Partnership
31700 Middlebelt Road, Suite 145
Farmington Hills, Michigan 48334
Re: Prospectus Supplement, dated August 20, 1997, for Medium-Term
Note Program of Sun Communities Operating Limited Partnership, a
Michigan limited partnership (the "Company")
Gentlemen:
We have acted as counsel for the Company in connection with the issuance
and sale by the Company of up to $100,000,000 aggregate principal amount of the
Company's Medium-Term Notes due nine months or more from date of issue (the
"Notes"). In our capacity as legal counsel to the Company, we have examined
and relied upon the following documents:
A. The joint registration statement of the Company and Sun
Communities, Inc., a Maryland corporation ("Sun"), on Form S-3,
Registration No. 333-14595 (the "Registration Statement"), and the
Prospectus constituting a part thereof, dated October 30, 1996,
relating to the issuance from time to time of up to $500,000,000
aggregate principal amount of securities pursuant to Rule 415
promulgated under the Securities Act of 1933, as amended (the
"1933 Act"); and
B. The Prospectus Supplement, dated August 20, 1997, to the
above-referenced Prospectus relating to the Notes and filed with
the Securities and Exchange Commission pursuant to Rule 424
promulgated under the 1933 Act (the "Prospectus Supplement");
C. Indenture, dated as of April 24, 1996, among Bankers Trust
Company, a New York banking corporation, as trustee, Sun, and the
Company;
D. First Supplemental Indenture, dated as of August 20, 1996,
among Bankers Trust Company, a New York banking corporation, as
trustee, Sun, and the Company;
E. Certified copy of the Charter of Sun issued by the State
Department of Assessments and Taxation of Maryland;
F. Copies of the bylaws, minute books, partnership
agreements, and other organizational documents for Sun, the
Company and their subsidiaries provided to us by management of the
Company; and
<PAGE> 2
[JAFFE, RAITT, HEUER & WEISS LETTERHEAD]
Sun Communities Operating Limited Partnership
August 20, 1997
Page 2
G. President's Certificate attached hereto as Exhibit "A".
This opinion is governed by, and shall be interpreted in accordance with,
Part II of the Report of the Ad Hoc Committee of the Business Law Section of
the State Bar of Michigan on Standardized Legal Opinions in Business
Transactions dated August 1, 1991, incorporated herein by reference. Without
limiting the generality of the foregoing, the meaning of the terms and phrases
used in this opinion (other than those defined in the Agreement) is governed by
and is subject to such Part II.
In our examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals, and the conformity
to original documents of documents submitted to us as certified or photostatic
copies. To the extent that the obligations of the Company under the Indenture
may be dependent upon such matters, we assume for purposes of this opinion that
the Trustee is duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization; that the Trustee is duly qualified to
engage in the activities contemplated by the Indenture; that the Indenture has
been duly authorized, executed and delivered by the Trustee and constitutes the
legally valid and binding obligation of the Trustee enforceable against the
Trustee in accordance with its terms; that the Trustee is in compliance, with
respect to acting as a trustee under the Indenture, with all applicable laws
and regulations; and that the Trustee has the requisite organizational and
legal power and authority to perform its obligations under the Indenture.
Our review has been limited to examining the documents described above,
the opinion of Ober, Kaler, Grimes & Shriver, Baltimore, Maryland, and
applicable Michigan and federal law. To the extent that any opinion given
herein relates to or is dependent upon factual information, or is expressed in
terms of our knowledge or awareness, we have relied upon the assumptions stated
above and the truth of the matters set forth in the President's Certificate.
We have not undertaken to independently verify such facts or information.
Based solely upon the foregoing, and subject to the qualifications and
limitations set forth herein, we are of the opinion that, as of the date
hereof, the Notes in an aggregate principal amount of up to $100,000,000 (the
"Authorized Amount") have been duly authorized by all necessary action by the
Board of Directors of Sun, as the general partner of the Company, for offer,
issuance, sale and delivery pursuant to the Indenture and, when the variable
terms of the Notes have been established by the authorized officers of Sun, as
the general partner of the Company, to whom such authority has been delegated,
and the Notes have been executed and authenticated in the manner provided for
in the Indenture and delivered by the Company to the purchasers thereof against
payment of the consideration therefor, the Notes will constitute valid and
legally binding obligations of the Company, enforceable against the Company in
accordance with their terms, except to the extent that enforcement thereof may
be limited by (1) bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, (2) general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or
in equity), (3) requirements that a claim with respect to any Notes payable
other than in U.S. dollars (or a foreign currency or composite currency
judgment in respect of such claim) be converted into U.S. dollars at a rate of
exchange prevailing on a date determined pursuant to applicable law, and (4)
governmental authority to limit, delay, or prohibit the making of payments
outside the United States. The opinions set forth in this paragraph are
qualified, in each instance, by the limitation that the aggregate principal
amount of Notes so offered, issued, sold and delivered may not exceed the
Authorized Amount without further action by the Board of Directors of Sun. No
<PAGE> 3
[JAFFE, RAITT, HEUER & WEISS LETTERHEAD]
Sun Communities Operating Limited Partnership
August 20, 1997
Page 3
opinion is expressed herein with respect to any Notes in an aggregate principal
amount in excess of the Authorized Amount.
We are admitted to practice law only in the State of Michigan and do not
purport to be experts on or to express any opinion herein concerning any laws
other than laws of the State of Michigan and the laws of the United States of
America, and we expressly decline to opine as to the laws of any other
jurisdiction. With respect to our opinions insofar as they implicate Maryland
law, we have relied solely upon the opinion of Ober, Kaler, Grimes & Shriver,
Baltimore, Maryland, and have not made any independent investigation of
Maryland law. In addition, we note that the Indenture provides that it is to
be governed by the laws of a state other than the State of Michigan. We have
made no study of the laws, decisions and other authorities of such state, and
we express no opinion concerning the validity, binding effect or enforceability
of the Indenture under the laws of such state.
We hereby consent to the filing of this opinion as an exhibit on the
Current Report on Form 8-K to be filed by the Company with the Securities and
Exchange Commission on or about August 20, 1997, and to the use of the name of
our firm in the Prospectus Supplement under the caption "LEGAL MATTERS".
Very truly yours,
JAFFE, RAITT, HEUER & WEISS
Professional Corporation
/s/ Jeffrey L. Forman
Jeffrey L. Forman
<PAGE> 1
EXHIBIT 8.1
[JAFFE, RAITT, HEUER & WEISS LETTERHEAD]
August 20, 1997
Sun Communities Operating Limited Partnership
31700 Middlebelt Road, Suite 145
Farmington Hills, Michigan 48334
Re: Prospectus Supplement, dated August 20, 1997, for Medium-Term
Note Program of Sun Communities Operating Limited Partnership, a
Michigan limited partnership (the "Company")
Gentlemen:
We have acted as counsel for the Company in connection with the issuance
and sale by the Company of up to $100,000,000 aggregate principal amount of the
Company's Medium-Term Notes due nine months or more from date of issue (the
"Notes"). In connection with the Prospectus Supplement to be filed by you on
or about August 20, 1997 with the Securities and Exchange Commission, you have
requested our opinion concerning the discussion in the Prospectus Supplement
under the heading "FEDERAL INCOME TAX CONSIDERATIONS".
In our capacity as legal counsel to the Company, we have examined and
relied upon the following documents:
1. The joint registration statement of the Company and Sun
Communities, Inc. on Form S-3, Registration No. 333-14595 (the
"Registration Statement"), and the Prospectus constituting a part
thereof, dated October 30, 1996, relating to the issuance from time
to time of up to $500,000,000 aggregate principal amount of
securities pursuant to Rule 415 promulgated under the Securities Act
of 1933, as amended (the "1933 Act"); and
2. The Prospectus Supplement, dated August 20, 1997, to the
above-referenced Prospectus relating to the Notes and filed with the
Securities and Exchange Commission pursuant to Rule 424 promulgated
under the 1933 Act (the "Prospectus Supplement").
You have requested our opinion regarding certain federal income tax
matters in connection with the offering of the Notes. The terms of the Notes
are described in the Prospectus Supplement.
We are of the opinion that the discussion in the Prospectus Supplement
under the heading "FEDERAL INCOME TAX CONSIDERATIONS" fairly summarizes the
material Federal income tax considerations discussed in it.
<PAGE> 2
[JAFFE, RAITT, HEUER & WEISS LETTERHEAD]
Sun Communities Operating Limited Partnership
August 20, 1997
Page 2
Other than as expressly stated above, we express no opinion on any issue
relating to the Company.
We hereby consent to the filing of this opinion as an exhibit on the
Current Report on Form 8-K to be filed by the Company with the Securities and
Exchange Commission on or about August 20, 1997, and to the use of the name of
our firm in the Prospectus Supplement under the caption "LEGAL MATTERS".
Very truly yours,
JAFFE, RAITT, HEUER & WEISS
Professional Corporation
/s/ William E. Sider
William E. Sider
