Document:

exv4w1

 

Exhibit 4.1

COMMERCIAL NET LEASE REALTY, INC.

as Issuer

to

WACHOVIA BANK, NATIONAL ASSOCIATION

as Trustee

Supplemental Indenture No. 5

Dated as of June 18, 2004

Supplementing the Indenture dated as of March 25, 1998

$150,000,000

of

6.25% Notes due 2014

 

 

               SUPPLEMENTAL INDENTURE NO. 5, dated as of June 18, 2004 (the “Supplemental
Indenture No. 5”), between COMMERCIAL NET LEASE REALTY, INC., a corporation
duly organized and existing under the laws of the State of Maryland (herein
called the “Company”), and WACHOVIA BANK, NATIONAL ASSOCIATION (as successor
trustee to First Union National Bank), a national banking association duly
organized and existing under the laws of the United States of America, as
Trustee (herein called the “Trustee”).

RECITALS OF THE COMPANY

               The Company and the Trustee are parties to an Indenture, dated as of March
25, 1998 (the “Original Indenture”), as supplemented by Supplemental Indenture
No. 1 dated as of March 25, 1998, Supplemental Indenture No. 2 dated as of June
21, 1999, Supplemental Indenture No. 3 dated as of September 20, 2000 and
Supplemental Indenture No. 4 dated as of May 30, 2002 (together with the
Original Indenture, Supplemental Indentures 1 through 4 and this Supplemental
Indenture No. 5, the “Indenture”) a form of which has been filed with the
Securities and Exchange Commission under the Securities Act of 1933, as
amended, as an exhibit to the Company’s Registration Statement on Form S-3
(Registration No. 333-105635), providing for the issuance from time to time of
Debt Securities of the Company (the “Securities”).

               The Company has heretofore issued, pursuant to the Indenture, (a)
$100,000,000 aggregate principal amount of 7-1/8% Notes due 2008, (b)
$100,000,000 aggregate principal amount of 8.125% notes due 2004, (c)
$20,000,000 aggregate principal amount of 8.50% notes due 2010, and (d)
$50,000,000 aggregate principal amount of 7.75% Notes due 2012.

               The Company has commenced an offering of 6.25% Notes due 2014 (the “6.25%
Notes”).

               Section 3.1 of the Original Indenture provides for various matters with
respect to any series of Securities issued under the Indenture to be
established in an indenture supplemental to the Indenture.

               Section 9.1(7) of the Original Indenture provides for the Company and the
Trustee to enter into an indenture supplemental to the Original Indenture to
establish the form or terms of Securities of any series as provided by Sections
2.1 and 3.1 of the Original Indenture.

               The Board of Directors of the Company has duly adopted resolutions
authorizing the Company to execute and deliver this Supplemental Indenture No.
5.

2

 

               All the conditions and requirements necessary to make this Supplemental
Indenture No. 5, when duly executed and delivered, a valid and legally binding
agreement in accordance with its terms and for the purposes herein expressed,
have been performed and fulfilled.

               NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE NO. 5 WITNESSETH:

               For and in consideration of the premises and the purchase of each of the
series of Securities provided for herein by the Holders thereof, it is mutually
covenanted and agreed, for the equal and proportionate benefit of all Holders
of the Securities, as follows:

ARTICLE ONE

RELATION TO INDENTURE; DEFINITIONS

               SECTION 1.1. Relation to Indenture.

               This Supplemental Indenture No. 5 constitutes an integral part of the
Indenture.

               SECTION 1.2. Definitions.

               For all purposes of this Supplemental Indenture No. 5, the following terms
shall have the meanings specified except as otherwise expressly provided for or
unless the context otherwise requires. Capitalized terms used but not defined
herein shall have the respective meanings assigned to them in the Indenture.
All references herein to Articles and Sections, unless otherwise specified,
refer to the corresponding Articles and
Sections of this Supplemental Indenture No. 5.

               “6.25% Notes” has the meaning given in the Recitals of the Company.

               “Acquired Indebtedness” means Indebtedness of a Person (i) existing at the
time such Person becomes a Subsidiary or (ii) assumed in connection with the
acquisition of assets from such Person, in each case, other than Indebtedness
incurred in connection with, or in contemplation of, such Person becoming a
Subsidiary or such acquisition. Acquired Indebtedness shall be deemed to be
incurred on the date of the related acquisition of assets from any Person or
the date the acquired Person becomes a Subsidiary.

               “Annual Debt Service Charge” for any period means the aggregate interest
expense for such period in respect of, and the amortization during such period
of any original issue discount of, Indebtedness of the Company and its
Subsidiaries and the

3

 

amount of dividends which are payable during such period in respect of any
Disqualified Stock.

               “Business Day” means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which banking institutions in the City of
New York or in the City of Charlotte are authorized or required by law,
regulation or executive order to close.

               “Capital Stock” means, with respect to any Person, any capital stock
(including preferred stock), shares, interests, participations or other
ownership interests (however designated) of such Person and any rights (other
than debt securities convertible into or exchangeable for corporate stock),
warrants or options to purchase any thereof.

               “Consolidated Income Available for Debt Service” for any period means
Earnings from Operations of the Company and its Subsidiaries plus amounts which
have been deducted, and minus amounts which have been added, for the following
(without duplication): (i) interest on Indebtedness of the Company and its
Subsidiaries, (ii) provision for taxes of the Company and its Subsidiaries
based on income, (iii) amortization of debt discount, (iv) provisions for gains
and losses on properties and property depreciation and amortization, (v) the
effect of any noncash charge resulting from a change in accounting principles
in determining Earnings from Operations for such period and (vi) amortization
of deferred charges.

               “Corporate Trust Office” means the office of the Trustee at which, at any
particular time, its corporate trust business for this transaction shall be
principally administered, which office at the date hereof is located at 225
Water Street, Third Floor, Jacksonville, Florida 32202, and for purposes of
the Place of Payment provisions of Sections 3.5 and 10.2 of the Original
Indenture, is located at 1525 West W.T. Harris Blvd., Charlotte, North Carolina
28288-1153.

               “Disqualified Stock” means, with respect to any Person, any Capital Stock
of such Person which by the terms of such Capital Stock (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise (i) matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise
(other than Capital Stock which is redeemable solely in exchange for common
stock), (ii) is convertible into or exchangeable or exercisable for
Indebtedness or Disqualified Stock or (iii) is redeemable at the option of the
holder thereof, in whole or in part (other than Capital Stock which is
redeemable solely in exchange for Capital Stock which is not Disqualified Stock
or the redemption price of which may, at the option of such Person, be paid in
Capital Stock which is not Disqualified Stock), in each case on or prior to the
Stated Maturity of the Notes.

               “Earnings from Operations” for any period means net earnings excluding
gains and losses on sales of investments, extraordinary items and property
valuation

4

 

losses, net as reflected in the financial statements of the Company and its
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP.

               “Encumbrance” means any mortgage, lien, charge, pledge or security
interest of any kind.

               “Exchange Act” means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder by the Commission.

               “GAAP” means generally accepted accounting principles as used in the
United States applied on a consistent basis as in effect from time to time;
provided that solely for purposes of any calculation required by the financial
covenants contained herein, “GAAP” shall mean generally accepted accounting
principles as used in the United States on the date hereof, applied on a
consistent basis.

               “Indebtedness” of the Company or any Subsidiary means any indebtedness of
the Company or any Subsidiary, whether or not contingent, in respect of (i)
borrowed money or evidenced by bonds, notes, debentures or similar instruments
whether or not such indebtedness is secured by any Encumbrance existing on
property owned by the Company or any Subsidiary, (ii) indebtedness for borrowed
money of a Person other than the Company or a Subsidiary which is secured by
any Encumbrance existing on property owned by the Company or any Subsidiary, to
the extent of the lesser of (x) the amount of indebtedness so secured and (y)
the fair market value (as determined in good faith by the Board of Directors of
the Company) of the property subject to such Encumbrance, (iii) the
reimbursement obligations, contingent or otherwise, in connection with any
letters of credit actually issued or amounts representing the balance deferred
and unpaid of the purchase price of any property or services, except any such
balance that constitutes an accrued expense or trade payable, or all
conditional sale obligations or obligations under any title retention
agreement, (iv) the principal amount of all obligations of the Company or any
Subsidiary with respect to redemption, repayment or other repurchase of any
Disqualified Stock, or (v) any lease of property by the Company or any
Subsidiary as lessee which is reflected on the Company’s consolidated balance
sheet as a capitalized lease in accordance with GAAP, and also includes, to the
extent not otherwise included, any obligation by the Company or any Subsidiary
to be liable for, or to pay, as obligor, guarantor or otherwise (other than for
purposes of collection in the ordinary course of business), Indebtedness of
another Person (other than the Company or any Subsidiary) (it being understood
that Indebtedness shall be deemed to be incurred by the Company or any
Subsidiary whenever the Company or such Subsidiary shall create, assume,
guarantee or otherwise become liable in respect thereof).

               “Make-Whole Amount” means, in connection with any optional redemption or
accelerated payment of any Note, the excess, if any, of (i) the aggregate
present value as of the date of such redemption or accelerated payment of each
dollar of principal being redeemed or paid and the amount of interest
(exclusive of interest accrued to the date of redemption or accelerated
payment) that would have been payable in

5

 

respect of such dollar if such redemption or accelerated payment had not been
made, determined by discounting, on a semi-annual basis, such principal and
interest at the Reinvestment Rate (determined on the third Business Day
preceding the date such notice of Redemption is given or declaration of
acceleration is made) from the respective dates on which such principal and
interest would have been payable if such redemption or accelerated payment had
not been made, over (ii) the aggregate principal amount of the Notes being
redeemed or paid.

               “Redemption Price” has the meaning specified in Section 2.5 hereof.

               “Reinvestment Rate” means 0.25 percent (twenty-five one hundredths of one
percent) plus the arithmetic mean of the yields under the respective headings
“This Week” and “Last Week” published in the Statistical Release under the
caption “Treasury constant maturities” for the maturity (rounded to the nearest
month) corresponding to the remaining life to maturity, as of the payment date
of the principal being redeemed or paid. If no maturity exactly corresponds to
such maturity, yields for the two published maturities most closely
corresponding to such maturity shall be calculated pursuant to the immediately
preceding sentence and the Reinvestment Rate shall be interpolated or
extrapolated from such yields on a straight-line basis, rounding in each of
such relevant periods to the nearest month. For such purposes of calculating
the Reinvestment Rate, the most recent Statistical Release published prior to
the date of determination of the Make-Whole Amount shall be used.

               “Statistical Release” means the statistical release designated “H.15(519)”
or any successor publication which is published weekly by the Federal Reserve
System and which establishes yields on actively traded United States government
securities adjusted to constant maturities or, if such statistical release is
not published at the time of any determination of the Make-Whole Amount, then
such other reasonably comparable index which shall be designated by the
Company.

               “Subsidiary” means, with respect to any Person, any corporation or other
entity of which a majority of (i) the voting power of the voting equity
securities or (ii) the outstanding equity interests of which are owned,
directly or indirectly, by such Person. For the purposes of this definition,
“voting equity securities” means equity securities having voting power for the
election of directors, whether at all times or only so long as no senior class
of security has such voting power by reason of any contingency.

               “Total Assets” as of any date means the sum of (i) the Undepreciated Real
Estate Assets and (ii) all other assets of the Company and its Subsidiaries
determined on a consolidated basis in accordance with GAAP (but excluding
accounts receivable and intangibles).

               “Total Unencumbered Assets” means the sum of (i) those Undepreciated Real
Estate Assets not subject to an Encumbrance for borrowed money and (ii) all
other assets of the Company and its Subsidiaries not subject to an Encumbrance
for borrowed

6

 

money, all determined on a consolidated basis in accordance with GAAP (but
excluding accounts receivable and intangibles).

               “Undepreciated Real Estate Assets” as of any date means the cost (original
cost plus capital improvements) of real estate assets of the Company and its
Subsidiaries on such date, before depreciation and amortization, determined on
a consolidated basis in accordance with GAAP.

               “Unsecured Indebtedness” means Indebtedness which is not secured by any
Encumbrance upon any of the properties of the Company or any Subsidiary.

ARTICLE TWO

THE SERIES OF NOTES

SECTION 2.1. Title of the Securities.

               There shall be a series of Securities designated the “6.25% Notes due
2014.”

SECTION 2.2. Limitation on Aggregate Principal Amount.

               (a) The aggregate principal amount of the 6.25% Notes shall be limited to
$150,000,000, provided that the Company may, without the consent of the Holders
of the Outstanding 6.25% Notes, “reopen” this series of Securities so as to
increase the aggregate principal amount of 6.25% Notes Outstanding in
compliance with the procedures set forth in the Indenture, including Sections
3.1 and 3.3 thereof, so long as any such additional Notes have the same tenor
and terms (including, without limitation, rights to receive accrued and unpaid
interest) as the 6.25% Notes then Outstanding.

               (b) Nothing contained in this Section 2.2 or elsewhere in this
Supplemental Indenture No. 5, or in the 6.25% Notes, is intended to or shall
limit execution by the Company or authentication or delivery by the Trustee of
6.25% Notes under the circumstances contemplated by Sections 3.3, 3.4, 3.5,
3.6, 9.6, 11.7 and 13.5 of the Original Indenture.

SECTION 2.3. Interest and Interest Rates; Maturity Date of 6.25% Notes.

               (a) The 6.25% Notes will bear interest at a rate of 6.25% per annum, from
June 18, 2004 or from the immediately preceding Interest Payment Date to which
interest has been paid or duly provided for, payable semi-annually in arrears
on June 15 and December 15 of each year, commencing December 15, 2004 (each, an
“Interest

7

 

Payment Date”), to the Person in whose name such 6.25% Note is registered
at the close of business on June 1 or December 1 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date (each, a
“Regular Record Date”). Interest on the 6.25% Notes will be computed on the
basis of a 360-day year comprised of twelve 30-day months.

               (b) The interest so payable on any 6.25% Note which is not punctually paid
or duly provided for on any Interest Payment Date (“Defaulted Interest”) shall
forthwith cease to be payable to the Person in whose name such 6.25% Note is
registered on the relevant Regular Record Date, and such Defaulted Interest
shall instead be payable either (i) to the Person in whose name such 6.25% Note
is registered on the Special Record Date for the payment of such Defaulted
Interest to be fixed by the Trustee, notice of which shall be given to the
Holder of such 6.25% Note not less than 10 days prior to such Special Record
Date or (ii) may be paid at any time in any other lawful manner in accordance
with the Indenture.

               (c) If any Interest Payment Date or Stated Maturity falls on a day that is
not a Business Day, the required payment shall be made on the next Business Day
as if it were made on the date such payment was due and no interest shall
accrue on the amount so payable for the period from and after such Interest
Payment Date or Stated Maturity, as the case may be.

               (d) The 6.25% Notes will mature on June 15, 2014.

SECTION 2.4. Limitations on Incurrence of Indebtedness.

               (a) The Company will not, and will not permit any Subsidiary to, incur any
Indebtedness if, immediately after giving effect to the incurrence of such
additional Indebtedness and the application of the proceeds thereof, the
aggregate principal amount of all outstanding Indebtedness of the Company and
its Subsidiaries (determined on a consolidated basis in accordance with GAAP)
is greater than 60% of the sum of (without duplication) (i) the Total Assets of
the Company and its Subsidiaries as of the end of the calendar quarter covered
in the Company’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q,
as the case may be, most recently filed with the Commission (or, if such filing
is not permitted under the Exchange Act, with the Trustee) prior to the
incurrence of such additional Indebtedness and (ii) the purchase price of any
real estate assets or mortgages receivable acquired, and the amount of any
securities offering proceeds received (to the extent such proceeds were not
used to acquire real estate assets or mortgages receivable or used to reduce
Indebtedness), by the Company or any Subsidiary since the end of such calendar
quarter, including those proceeds obtained in connection with the incurrence of
such additional Indebtedness.

               (b) In addition to the limitation set forth in subsection (a) of this
Section 2.4, the Company will not, and will not permit any Subsidiary to, incur
any Indebtedness if the ratio of Consolidated Income Available for Debt Service
to the

8

 

Annual Debt Service Charge for the four consecutive fiscal quarters most
recently ended prior to the date on which such additional Indebtedness is to be
incurred shall have been less than 1.5:1, on a pro forma basis after giving
effect thereto and to the application of the proceeds therefrom, and calculated
on the assumption that (i) such Indebtedness and any other Indebtedness
incurred by the Company and its Subsidiaries since the first day of such
four-quarter period and the application of the proceeds therefrom, including to
refinance other Indebtedness, had occurred at the beginning of such period;
(ii) the repayment or retirement of any other Indebtedness by the Company and
its Subsidiaries since the first day of such four-quarter period had been
repaid or retired at the beginning of such period (except that, in making such
computation, the amount of Indebtedness under any revolving credit facility
shall be computed based upon the average daily balance of such Indebtedness
during such period); (iii) in the case of Acquired Indebtedness or Indebtedness
incurred in connection with any acquisition since the first day of such
four-quarter period, the related acquisition had occurred as of the first day
of such period with the appropriate adjustments with respect to such
acquisition being included in such pro forma calculation; and (iv) in the case
of any acquisition or disposition by the Company or its Subsidiaries of any
asset or group of assets since the first day of such four-quarter period,
whether by merger, stock purchase or sale, or asset purchase or sale, such
acquisition or disposition or any related repayment of Indebtedness had
occurred as of the first day of such period with the appropriate adjustments
with respect to such acquisition or disposition being included in such pro
forma calculation.

               (c) In addition to the limitations set forth in subsections (a) and (b) of
this Section 2.4, the Company will not, and will not permit any Subsidiary to,
incur any Indebtedness secured by any Encumbrance upon any of the property of
the Company or any Subsidiary if, immediately after giving effect to the
incurrence of such additional Indebtedness and the application of the proceeds
thereof, the aggregate principal amount of all outstanding Indebtedness of the
Company and its Subsidiaries (determined on a consolidated basis in accordance
with GAAP) which is secured by any Encumbrance on property of the Company or
any Subsidiary is greater than 40% of the sum of (without duplication) (i) the
Total Assets of the Company and its Subsidiaries as of the end of the calendar
quarter covered in the Company’s Annual Report on Form 10-K or Quarterly Report
on Form 10-Q, as the case may be, most recently filed with the Commission (or,
if such filing is not permitted under the Exchange Act, with the Trustee) prior
to the incurrence of such additional Indebtedness and (ii) the purchase price
of any real estate assets or mortgages receivable acquired, and the amount of
any securities offering proceeds received (to the extent that such proceeds
were not used to acquire real estate assets or mortgages receivable or used to
reduce Indebtedness), by the Company or any Subsidiary since the end of such
calendar quarter, including those proceeds obtained in connection with the
incurrence of such additional Indebtedness.

               (d) The Company and its Subsidiaries may not at any time own Total
Unencumbered Assets equal to less than 150% of the aggregate outstanding
principal

9

 

amount of the Unsecured Indebtedness of the Company and its Subsidiaries on a
consolidated basis.

               (e) For purposes of this Section 2.4, Indebtedness shall be deemed to be
“incurred” by the Company or a Subsidiary whenever the Company or such
Subsidiary shall create, assume, guarantee or otherwise become liable in
respect thereof.

               SECTION 2.5. Redemption.

               The 6.25% Notes may be redeemed at any time at the option of the Company,
in whole or in part, at a redemption price equal to the sum of (i) the
principal amount of the Notes being redeemed plus accrued interest thereon to
the Redemption Date and (ii) the Make-Whole Amount, if any, with respect to
such 6.25% Notes (the “Redemption Price”).

               SECTION 2.6. Place of Payment.

               The Place of Payment where the 6.25% Notes may be presented or surrendered
for payment, where the 6.25% Notes may be surrendered for registration of
transfer or exchange and where notices and demands to and upon the Company in
respect of the 6.25% Notes and the Indenture may be served shall be in the City
of Charlotte, North Carolina, and the office or agency for such purpose shall
initially be located at Wachovia Bank, National Association, 1525 West W.T.
Harris Blvd., Charlotte, North Carolina 28288-1153.

               SECTION 2.7. Method of Payment.

               Payment of the principal of and interest on the 6.25% Notes will be made
at the office or agency of the Company maintained for that purpose (which shall
initially be an office or agency of the Trustee), in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts; provided, however, that, at the option of
the Company, payments of principal and interest on the Notes (other than
payments of principal and interest due at Stated Maturity) may be made (i) by
check mailed to the address of the Person entitled thereto as such address
shall appear in the Security Register or (ii) by wire transfer to an account
maintained by the Person entitled thereto located within the United States,
provided, that such Person owns 6.25% Notes in an aggregate principal amount of
at least $1,000,000 and such Person makes a written request therefor for the
appropriate Interest Payment Date.

               SECTION 2.8. Currency.

               Principal and interest on the 6.25% Notes shall be payable in Dollars.

10

 

               SECTION 2.9. Registered Securities; Global Form.

               The 6.25% Notes shall be issuable and transferable in fully registered
form as Registered Securities, without coupons. The 6.25% Notes shall each be
issued in the form of one or more permanent Global Securities. The depository
for the 6.25% Notes shall initially be The Depository Trust Company (“DTC”).
The 6.25% Notes shall not be issuable in definitive form except as provided in
Section 3.5 of the Original Indenture.

               SECTION 2.10. Form of Notes.

               The 6.25% Notes shall be substantially in the form attached as Exhibit A
hereto.

               SECTION 2.11. Registrar and Paying Agent.

               The Trustee shall initially serve as Registrar and Paying Agent for the
Notes.

               SECTION 2.12. Defeasance.

               The provisions of Sections 14.2 and 14.3 of the Original Indenture,
together with the other provisions of Article XIV of the Original Indenture,
shall be applicable to the 6.25% Notes. The provisions of Section 14.3 of the
Original Indenture shall apply to the covenants set forth in Section 2.4 of
this Supplemental Indenture No. 5 and to those covenants specified in Section
14.3 of the Original Indenture.

               SECTION 2.13. Waiver of Certain Covenants.

               Notwithstanding the provisions of Section 10.11 of the Original Indenture,
the Company may omit in any particular instance to comply with any term,
provision or condition set forth in Sections 10.4 to 10.8, inclusive, of the
Original Indenture, with Section 2.4 of this Supplemental Indenture No. 5 and
with any other term, provision or condition with respect to the 6.25% Notes
(except any such term, provision or condition which could not be amended
without the consent of all Holders of the 6.25% Notes), if before or after the
time for such compliance the Holders of at least a majority in principal amount
of all outstanding 6.25% Notes or such series thereof, as applicable, by Act of
such Holders, either waive such compliance in such instance or generally waive
compliance with such covenant or condition. Except to the extent so expressly
waived, and until such waiver shall become effective, the obligations of the
Company and the duties of the Trustee in respect of any such term, provision or
condition shall remain in full force and effect.

11

 

               SECTION 2.14. Acceleration of Maturity; Recission and Annulment.

               If an Event of Default with respect to Securities of any series at the
time Outstanding occurs and is continuing, then in every such case the Trustee
or the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal of, and the Make-Whole
Amount, if any, on, all the Securities of that series to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by the Holders), and upon any such declaration such principal or specified
portion thereof shall become immediately due and payable. If an Event of
Default with respect to the Securities of any series set forth in Sections
5.1(1), 5.1(2) and 5.1(6) of the Original Indenture occurs and is continuing,
then in every such case all the Securities of that series shall become
immediately due and payable, without notice to the Company, at the principal
amount thereof plus accrued interest to the date the Securities of that series
are paid plus the Make-Whole Amount, if any, on the Securities of that series.

               SECTION 2.15. Provision of Financial Information.

               Whether or not the Company is subject to Section 13 or 15(d) of the
Exchange Act, the Company will, to the extent permitted under the Exchange Act,
file with the Commission the annual reports, quarterly reports and other
documents which the Company would have been required to file with the
Commission pursuant to such Section 13 or 15(d) if the Company were so subject,
such documents to be filed with the Commission on or prior to the respective
dates (the “Required Filing Dates”) by which the Company would have been
required to file such documents if the Company were so subject.

               The Company will also in any event (x) within 15 days of each Required
Filing Date (i) if the Company is not then subject to such Section 13 or 15(d),
transmit by mail to all Holders of Notes, as their names and addresses appear
in the Security Register, without cost to such Holders, copies of the annual
reports and quarterly reports and other documents that the Company would have
been required to file with the Commission pursuant to Section 13 or 15(d) of
the Exchange Act if the Company were subject to such Sections and (ii) file
with the Trustee copies of the annual reports, quarterly reports and other
documents that the Company would have been required to file with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act if the Company were subject
to such Sections and (y) if filing such documents by the Company with the
Commission is not permitted under the Exchange Act, promptly upon written
request and payment of the reasonable cost of duplication and delivery, supply
copies of such documents to any prospective Holder.

               SECTION 2.16. Event of Default.

               If an Event of Default pursuant to Section 5.1(6) or (7) of the Original
Indenture shall have occurred, the principal amount of and the Make-Whole
Amount on

12

 

all outstanding notes shall become due and payable without any declaration
or other act on the part of the Trustee or of the Holders.

ARTICLE THREE

MISCELLANEOUS PROVISIONS

SECTION 3.1. Ratification of Original Indenture.

               Except as expressly modified or amended hereby, the Original Indenture
continues in full force and effect and is in all respects confirmed and
preserved.

SECTION 3.2. Fiscal Year.

               The Company shall notify the Trustee of its fiscal year and any change
thereof.

SECTION 3.3. Governing Law.

               This Supplemental Indenture No. 5 and each Note shall be governed by and
construed in accordance with the laws of the State of New York. This
Supplemental Indenture No. 5 is subject to the provisions of the Trust
Indenture Act of 1939, as amended, and shall, to the extent applicable, be
governed by such provisions.

SECTION 3.4. Counterparts.

               This Supplemental Indenture No. 5 may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same
instrument.

13

 

     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. 5 to be duly executed by their respective officers hereunto duly
authorized, all as of the day and year first written above.

    	 	 
	 	COMMERCIAL
            NET LEASE REALTY, INC.,

	 	as Issuer

	 	 

	 	By:

	 	

           

	 	Name:
            Kevin Habicht

	 	Title:
            Executive Vice President,

	 	          Chief
            Financial Officer, Assistant Secretary and

                      Treasurer

	 	 

	 	WACHOVIA
            BANK, NATIONAL ASSOCIATION

	 	as Trustee

	 	 

	 	By:

	 	

           

	 	Name:
            John C. Stephens, III

	 	Title:   Vice
            President

14

 

Exhibit A

Form of 6.25% Notes

15exv4w2

 

Exhibit 4.2

Unless this Security is presented by an authorized representative of The
Depository Trust Company, a New York corporation (“DTC”), 55 Water Street, New
York, New York, 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.

This Security is a Global Security within the meaning set forth in the
Indenture hereinafter referred to and is registered in the name of DTC or a
nominee of DTC. This Security is exchangeable for Securities registered in the
name of a person other than DTC or its nominee only in the limited
circumstances described in the Indenture, and may not be transferred except as
a whole by DTC to a nominee of DTC or another nominee of DTC or by DTC or its
nominee to a successor Depository or its nominee.

    	 	 	 
	Registered
            No. 001 
	 	PRINCIPAL AMOUNT 
	CUSIP No.: 202218 AG 8	 	$150,000,000.00 (subject to revision 
	 	 	                               as set forth below)

COMMERCIAL NET LEASE REALTY, INC.

6.25% NOTE DUE 2014

     COMMERCIAL NET LEASE REALTY, INC., a corporation duly organized and
existing under the laws of the State of Maryland (herein referred to as the
“Company” which term shall include any successor corporation under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to CEDE & CO., or registered assigns, upon presentation, the principal sum of
ONE HUNDRED FIFTY MILLION AND 00/100THS DOLLARS ($150,000,000.00), as may be
revised by the Schedule of Increases or Decreases in Global Security attached
hereto, on June 15, 2014 and to pay interest on the outstanding principal
amount thereon from June 18, 2004, or from the immediately preceding Interest
Payment Date to which interest has been paid or duly provided for,
semi-annually in arrears on June 15 and December 15 in each year, commencing
December 15, 2004, at the rate of 6.25% per annum, until the entire principal
hereof is paid or made available for payment. The interest so payable and
punctually paid or duly provided for on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name this Security is
registered at the close of business on the Regular Record Date for such
interest which shall be the June 1 or December 1 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so punctually paid or duly provided for shall forthwith cease to
be payable to the Holder on such Regular Record Date, and may either be paid to
the Person in whose name this Security is registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to Holders of the Securities not

more than 15 days and not less than 10 days prior to such Special Record Date,

- 1 -

 

or may be paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in the Indenture. Payment of the principal of and interest on this
Security will be made at the office or agency maintained for that purpose in
the City of Charlotte, North Carolina, or elsewhere as provided in the
Indenture, in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payments of principal and
interest on the 6.25% Notes (other than payments of principal and interest due
at Maturity) may be made (i) by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register or (ii)
by wire transfer to an account of the Person entitled thereto located within
the United States, provided, that such Person owns 6.25% Notes in an aggregate
principal amount of at least $1,000,000 and such Person makes a written request
therefor for the appropriate Interest Payment Date.

     Securities of this series are one of a duly authorized issue of securities
of the Company (herein called the “Securities”), issued and to be issued in one
or more series under an Indenture, dated as of March 25, 1998 (as so
supplemented, herein called the “Indenture”), between the Company and Wachovia
Bank, National Association, as successor trustee to First Union National Bank
(herein called the “Trustee,” which term includes any successor trustee under
the Indenture), to which Indenture and all indentures supplemental thereto,
including, the Fifth Supplemental Indenture thereto, dated June 18, 2004
between the Company and the Trustee, 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 authenticated and delivered. This
Security is one of the series designated in the first page thereof, initially
limited in aggregate principal amount to $150,000,000, provided, that the
Company may, without the consent of the Holders of the Outstanding 6.25% Notes,
“reopen” this series of Securities so as to increase the aggregate principal
amount of 6.25% Notes Outstanding in compliance with the procedures set forth
in the Indenture, including Sections 3.1 and 3.3 thereof, so long as any such
additional notes have the same tenor and terms (including, without limitation,
rights to receive accrued and unpaid interest) as the 6.25% Notes then
Outstanding.

     Securities of this series may be redeemed at any time at the option of the
Company, in whole or in part, upon notice of not more than 60 nor less than 30
days prior to the Redemption Date, at a redemption price equal to the sum of
(i) the principal amount of the Securities being redeemed plus accrued interest
thereon to the Redemption Date and (ii) the Make-Whole Amount, if any, with
respect to such Securities.

     The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Company on this Security 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 Security.

- 2 -

 

     If an Event of Default with respect to the Securities shall occur and be
continuing, the principal of the Securities 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 Security 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 thereunder, unless such Holder shall have previously given
written notice to the Trustee of a continuing Event of Default with respect to
the Securities, 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 and offered the Trustee reasonable indemnity and 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, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The
foregoing shall not apply to any suit instituted by the Holder of this Security
for the enforcement of any payment of principal hereof or any interest on or
after the respective due dates expressed herein.

     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 Outstanding Securities of each series of Securities then Outstanding
affected thereby. The Indenture also contains provisions permitting the
Holders of specified percentages 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 Holder of this Security shall be conclusive
and binding upon such Holder and upon all future Holders of this Security 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 Security.

     No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of (and Make-Whole Amount, if
any) and interest on this Security 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 Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any Place of Payment where the principal of
(and Make-Whole Amount, if any) and interest on this Security 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 thereupon 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.

- 3 -

 

     The Securities of this series are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal
amount of Securities of this series of a different authorized denomination, as
requested by the Holder surrendering the same.

     This 6.25% Note is a Global Security. As provided in and subject to the
provisions of the Indenture, definitive Securities shall be issued to all
owners of beneficial interests in a Global Security in exchange for such
interests if: (1) the depositary with respect to the 6.25% Notes (which shall
initially be DTC) notifies the Company that it is unwilling or unable to
continue as depositary for such Global Security or the depositary ceases to be
a clearing agency registered under the Exchange Act, at a time when the
depositary is required to be so registered in order to act as depositary, and
in each case a successor depositary is not appointed by the Company within 90
days of such notice; (2) an Event of Default has occurred and is continuing and
the Security Registrar has received a request from the depositary or (3) the
Company executes and delivers to the Trustee and Security Registrar an
Officers’ Certificate stating that such Global Security shall be so
exchangeable. In connection with the exchange of an entire Global Security for
definitive Securities pursuant to this paragraph, such Global Security shall be
deemed to be surrendered to the Trustee for cancellation, and the Company shall
execute and the Trustee shall authenticate and deliver, to each beneficial
owner identified by the depositary in exchange for its beneficial interest in
such Global Security, an equal aggregate principal amount of definitive
Securities of authorized denominations.

     No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

     Prior to due presentment of this Security 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 Security is registered as the owner hereof for
all purposes, whether or not this Security 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 Security, or because of any indebtedness evidenced
hereby or thereby, shall be had against any promoter, as such, or against any
past, present or future shareholder, 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 Security by the Holder thereof and as part of the
consideration for the issue of the Securities of this series.

     All capitalized terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.

- 4 -

 

     THE INDENTURE AND THE SECURITIES, INCLUDING THIS SECURITY, SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS 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 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.

     Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee by manual signature, this Security shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any purpose.

- 5 -

 

  IN WITNESS WHEREOF, COMMERCIAL NET LEASE
    REALTY, INC. has caused this instrument to be duly executed under its corporate
    seal.
  

	Dated: June 18, 2004	 	 	 	 
	 	 	COMMERCIAL NET LEASE REALTY, INC.
	 
	 	 	 	 
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	[SEAL]

	 	 	 	Name:
	

	 	 	 	Title:
	 
	 	 	 	 
	 
	 	 	 	 
	Attest:
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
            

          
	 	 	 	 
	Secretary
	 	 	 	 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION:

     This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.

    	 	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL
	 	 	ASSOCIATION, as Trustee
	 	 	 	 	 
	 
	 	 	 	 
	Dated:
            June 18, 2004 
	 	By:	 	 
	 
	 	 	 	
  
	 
	 	 	 	Authorized Signatory

- 6 -

 

ASSIGNMENT FORM

FOR VALUE RECEIVED, the undersigned hereby

Sells, assigns and transfers unto

PLEASE INSERT SOCIAL

SECURITY OR OTHER IDENTIFYING

NUMBER OF ASSIGNEE

  (Please Print or Typewrite Name and
    Address including

    Zip Code of Assignee)
        
 

the within Security of Commercial Net Lease Realty, Inc. and hereby does
irrevocably constitute and appoint

 

Attorney to transfer said Security on the books of the within-named Company with full power
of substitution in the premises.

    	 	 	 	 
	Dated: 	
	 	

	 	
  
          
	 	
  

NOTICE: The signature to this assignment must correspond with the name as it
appears on the first page of the within Security in every particular, without
alteration or enlargement or any change whatever.

- 7 -

 

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

The following increases or decreases in this Global Security have been made:

    	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 Date
	 	Amount of Decrease	 	Amount of Increase	 	Principal Amount of	 	Signature of
	 
	 	in Principal Amount	 	in Principal Amount	 	this Global	 	Authorized Officer
	 
	 	of this Global	 	of this Global	 	Security Following	 	of Trustee or
	 
	 	Security	 	Security	 	Such Increase or	 	Custodian
	 
	 	 	 	 	 	 	 	 	 	Decrease	 	 	 	 
	 

          
     
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

          
     
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

          
     
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

          
     

- 8 -

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00068-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00068-of-00352.parquet"}]]