<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 22, 1998.
REGISTRATION NO. 333-60973
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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PRE-EFFECTIVE AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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METRIS COMPANIES INC.
(Exact name of the Registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 41-1849591
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
</TABLE>
600 SOUTH HIGHWAY 169
SUITE 1800
ST. LOUIS PARK, MN 55426
(612) 525-5020
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
Z. JILL BARCLIFT, ESQ.
VICE PRESIDENT, ASSISTANT SECRETARY AND GENERAL COUNSEL
600 SOUTH HIGHWAY 169
SUITE 1800
ST. LOUIS PARK, MN 55426
(612) 525-5020
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
------------------------------
COPY TO:
Richard G. Clemens, Esq.
Sidley & Austin
One First National Plaza
Chicago, Illinois 60603
(312) 853-7000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE, AS
DETERMINED BY MARKET CONDITIONS.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED(1) UNIT (2) PRICE (2) REGISTRATION FEE
<S> <C> <C> <C> <C>
Subordinated Debt Securities
Preferred Stock, $.01 par value(3)
Common Stock, $.01 par value(3)
Total............................... $750,000,000 100% $750,000,000 $221,250
</TABLE>
(1) Such indeterminate number or amount of Subordinated Debt Securities,
Preferred Stock and Common Stock (including preferred stock purchase rights
appurtenant thereto) of Metris Companies Inc. as may from time to time be
issued at indeterminate prices. The amount registered is in United States
dollars or the equivalent thereof in any other currency, currency unit or
units, or composite currency or currencies.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457. The aggregate offering price of the Debt Securities,
Preferred Stock and Common Stock registered hereby will not exceed
$750,000,000.
(3) Also includes such indeterminate number of shares of Preferred Stock and
Common Stock as may be issued upon conversion of or exchange for any Debt
Securities or Preferred Stock registered hereunder that provide for
conversion or exchange into other securities. No separate consideration will
be received for the Preferred Stock or Common Stock issuable upon conversion
of or exchange for Debt Securities or Preferred Stock.
------------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SECTION 8(a), MAY DETERMINE.
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<PAGE>
SUBJECT TO COMPLETION, DATED SEPTEMBER 22, 1998
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. METRIS
COMPANIES INC. HAS FILED A REGISTRATION STATEMENT RELATING TO THESE SECURITIES
WITH THE SECURITIES AND EXCHANGE COMMISSION. WE MAY NOT SELL OR ACCEPT OFFERS TO
BUY THESE SECURITIES BEFORE THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS
PROSPECTUS IS NOT AN OFFER TO SELL AND IT IS NOT SOLICITING AN OFFER TO BUY
THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. ANY SALE
OF THESE SECURITIES MUST BE ACCOMPANIED BY A SUPPLEMENT TO THIS PROSPECTUS.
<PAGE>
PROSPECTUS
$750,000,000
METRIS COMPANIES INC.
[LOGO]
SUBORDINATED DEBT SECURITIES, PREFERRED STOCK AND COMMON STOCK
We may use this Prospectus from time to time to offer subordinated debt
securities, consisting of debentures, notes and other unsecured evidences of
indebtedness, shares of Preferred Stock and shares of Common Stock of Metris
Companies Inc., a Delaware corporation. We will refer to the debt securities,
Preferred Stock and Common Stock as the "Securities."
The aggregate initial offering price of the Securities may not exceed
$750,000,000 (or its equivalent in any other currency or units based on or
relating to foreign currencies). We have included the specific terms of the
particular Securities for which this Prospectus is being delivered in an
accompanying Prospectus Supplement. Such terms include: (i) in the case of debt
securities, the specific designation, aggregate principal amount, denomination
(which may be in United States dollars, or the equivalent thereof in any other
currency or in units based on or relating to foreign currencies), maturity,
premium, if any, interest rate (which may be fixed or variable), time and method
of calculating interest, if any, place or places where principal, premium, if
any, and interest, if any, on such debt securities will be payable, the
currencies or currency units in which principal, premium, if any, and interest,
if any, on such debt securities will be payable, any terms of redemption or
conversion, any sinking fund provisions, the purchase price, any listing on a
securities exchange or quotation on a national quotation system, the method of
distribution and other special terms; (ii) in the case of Preferred Stock, the
specific title, aggregate amount, any dividends (including the method of
calculating the payment of dividends), liquidation, redemption, conversion,
exchange, voting and other rights and other special terms; and (iii) in the case
of Common Stock, the number of shares offered, the initial offering price,
market price and dividend information and the method of distribution.
We may issue the debt securities in registered form or bearer form, or both.
In addition, we may issue all or a portion of the debt securities of any series
in permanent registered global form which will be exchangeable only under
certain conditions for definitive debt securities.
The Common Stock is quoted on The Nasdaq Stock Market under the symbol
"MTRS."
INVESTING IN THE SECURITIES INVOLVES CERTAIN RISKS. SEE "RISK FACTORS" IN
THE ACCOMPANYING PROSPECTUS SUPPLEMENT.
We may sell the Securities to or through underwriters, dealers or agents or
directly to purchasers, or through a combination of these methods. The
accompanying Prospectus Supplement sets forth the names of any underwriters,
dealers or agents involved in the sale of the Securities for which this
Prospectus is being delivered and any applicable fee, commission or discount
arrangements.
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THESE SECURITIES HAVE NOT BEEN APPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAVE THESE ORGANIZATIONS
DETERMINED THAT THIS PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
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The date of this Prospectus is , 1998.
<PAGE>
FORWARD-LOOKING STATEMENTS
THIS PROSPECTUS AND THE DOCUMENTS INCORPORATED BY REFERENCE HEREIN CONTAIN
FORWARD-LOOKING STATEMENTS. THESE STATEMENTS INCLUDE STATEMENTS REGARDING
INTENT, BELIEF OR CURRENT EXPECTATIONS OF METRIS COMPANIES INC. (THE "COMPANY")
AND ITS MANAGEMENT. YOU ARE CAUTIONED THAT ANY SUCH FORWARD-LOOKING STATEMENTS
ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND INVOLVE A NUMBER OF RISKS AND
UNCERTAINTIES THAT MAY CAUSE THE COMPANY'S ACTUAL RESULTS TO DIFFER MATERIALLY
FROM THE RESULTS DISCUSSED IN THE FORWARD-LOOKING STATEMENTS. AMONG THE FACTORS
THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE INDICATED BY
SUCH FORWARD-LOOKING STATEMENTS ARE THE COMPANY'S LIMITED OPERATING HISTORY AS A
STAND-ALONE ENTITY; THE COMPANY'S LIMITED EXPERIENCE WITH RESPECT TO ORIGINATING
AND SERVICING CREDIT CARD ACCOUNTS, INCLUDING LIMITED DELINQUENCY, DEFAULT AND
LOSS EXPERIENCE; THE LACK OF SEASONING OF THE COMPANY'S CREDIT CARD PORTFOLIO,
WHICH MAKES THE PREDICTABILITY OF DELINQUENCY AND LOSS LEVELS MORE DIFFICULT;
RISKS ASSOCIATED WITH UNSECURED CREDIT TRANSACTIONS, PARTICULARLY TO MODERATE
INCOME CONSUMERS; RISKS ASSOCIATED WITH ACQUIRED PORTFOLIOS; INTEREST RATE
RISKS; DEPENDENCE ON THE SECURITIZATION OF THE COMPANY'S CREDIT CARD LOANS OR
THE CAPITAL MARKETS TO FUND OPERATIONS; GENERAL ECONOMIC CONDITIONS AFFECTING
CONSUMER INCOME, WHICH MAY INCREASE CONSUMER BANKRUPTCIES, DEFAULTS AND
DELINQUENCIES; STATE AND FEDERAL LAWS AND REGULATIONS, INCLUDING CONSUMER AND
DEBTOR PROTECTION LAWS; AND THE HIGHLY COMPETITIVE INDUSTRY IN WHICH THE COMPANY
OPERATES.
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
The Securities Exchange Act of 1934, as amended (the "Exchange Act"),
requires the Company to file reports, proxy statements and other information
with the Securities and Exchange Commission (the "SEC"). You may inspect and
copy such reports, proxy statements and other information at the public
reference facilities maintained by the SEC at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, and at the regional offices of the SEC located at 7
World Trade Center, 13th Floor, New York, New York 10048, and Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661. You may obtain
more information about the public reference facilities by calling the SEC at
1-800-SEC-0330. In addition, you may access such reports, proxy statements and
other information electronically by means of the SEC's Web site at
http://www.sec.gov.
The Company has filed a Registration Statement related to the offering
described in this Prospectus. As allowed by SEC rules, this Prospectus does not
contain all of the information which you can find in the Registration Statement.
You are referred to such Registration Statement and its exhibits, which may be
inspected or obtained as indicated above. This Prospectus is qualified in its
entirety by such other information.
The Exchange Act allows the Company to "incorporate by reference"
information into this Prospectus, which means that we can disclose important
information to you by referring you to another document filed separately with
the SEC. This Prospectus incorporates by reference the following documents that
we have previously filed with the SEC:
1. the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997;
2. the Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 1998; and
3. the Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 1998.
This Prospectus also incorporates by reference additional documents that may
be filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act between the date of this Prospectus and the date our offering is
completed.
You may obtain copies of such documents which are incorporated by reference
in this Prospectus (other than exhibits thereto which are not specifically
incorporated by reference therein), without charge, upon written or oral request
to Metris Companies Inc., 600 South Highway 169, Suite 1800, St. Louis Park,
Minnesota 55426, Attention: Investor Relations (telephone number (612)
593-4820).
You should rely only on the information contained or incorporated by
reference in this Prospectus. We have not authorized anyone to provide you with
information that is different from what is contained in this Prospectus. The
information contained in this Prospectus and the accompanying Prospectus
Supplement is accurate as of the dates on their covers. When the Company
delivers this Prospectus or a Prospectus Supplement or makes a sale pursuant to
this Prospectus, the Company is not implying that the information is current as
of the date of delivery or sale. This Prospectus does not constitute an offer to
buy or sell any securities in any jurisdiction where it is unlawful to do so.
<PAGE>
THE COMPANY
GENERAL
The Company is an information-based direct marketer and provider of consumer
credit products and fee-based and enhancement services primarily to moderate
income consumers and customers of third party clients. The Company's primary
consumer credit products are unsecured credit cards issued by its subsidiary,
Direct Merchants Credit Card Bank, National Association. The Company's existing
and prospective credit card accounts include customers of Fingerhut Corporation,
a former affiliate ("Fingerhut"), and other customers for whom general credit
bureau information is available. The Company markets its fee-based services,
including debt waiver programs, card registration, extended service plans,
purchase protection programs, membership clubs and insurance and fee-based
services provided by third parties, to its credit card customers and customers
of third parties.
The Company's principal executive offices are located at 600 South Highway
169, Suite 1800, St. Louis Park, Minnesota 55426, telephone number (612)
525-5020.
2
<PAGE>
RISK FACTORS
Certain of the Securities we are offering may involve a high degree of risk.
You should carefully consider the risk factors set forth in the accompanying
Prospectus Supplement before investing in such Securities.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratios of earnings to fixed charges for
the Company and its consolidated subsidiaries for the periods indicated. The
Company to date has not issued Preferred Stock; therefore, the ratios of
earnings to combined fixed charges and preferred stock dividends are the same as
the ratios of earnings to fixed charges set forth below.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED JUNE 30, YEAR ENDED DECEMBER 31,
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1998 1997 1997 1996 1995 1994 1993
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<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges 3.81 7.78 5.67 8.26 6.88 134.16 N/A
</TABLE>
The computation of the ratio of earnings to fixed charges includes
applicable amounts for the Company and its consolidated subsidiaries. "Earnings"
consist of earnings from continuing operations before income taxes, plus fixed
charges. "Fixed charges" consist of interest on indebtedness and a portion of
rental expense that is deemed to be representative of the interest factor. The
ratio of earnings to fixed charges is calculated on an owned basis (i.e.
excluding securitized assets).
USE OF PROCEEDS
Unless otherwise indicated in the accompanying Prospectus Supplement, the
Company expects to use the net proceeds from the sale of the Securities offered
hereby for general corporate purposes. The Company will describe in a Prospectus
Supplement any specific allocation of the proceeds to a particular purpose that
has been made at the date of such Prospectus Supplement.
DESCRIPTION OF DEBT SECURITIES
The debt securities offered hereby, consisting of notes, debentures and
other evidences of indebtedness ("Debt Securities"), are to be issued in one or
more series constituting subordinated Debt Securities ("Subordinated Debt").
Unless otherwise specified in the applicable Prospectus Supplement, the Debt
Securities will be issued pursuant to an indenture described below (the
"Indenture") between the Company and the trustee identified therein (the
"Indenture Trustee"), the form of which has been filed as an exhibit to the
Registration Statement of which this Prospectus forms a part.
The statements herein relating to the Debt Securities and the following
summaries of certain general provisions of the Indenture do not purport to be
complete and are subject to, and are qualified in their entirety by reference
to, all the provisions of the Indenture (as it may be amended or supplemented
from time to time), including the definitions therein of certain terms
capitalized in this Prospectus. All article and section references appearing
herein are to articles and sections of the Indenture and whenever particular
sections or defined terms of the Indenture (as it may be amended or supplemented
from time to time) are referred to herein or in a Prospectus Supplement, such
sections or defined terms are incorporated herein or therein by reference.
GENERAL
The Debt Securities will be unsecured obligations of the Company. The
Indenture does not limit the aggregate amount of Debt Securities which may be
issued thereunder, nor does it limit the incurrence or issuance of secured or
other unsecured debt of the Company. The Debt Securities issued under the
Indenture will be subordinate in right of payment, to the extent and in the
manner set forth
3
<PAGE>
in the Indenture, to all Senior Indebtedness of the Company. See
"--Subordination under the Indenture."
Reference is made to the applicable Prospectus Supplement which will
accompany this Prospectus for a description of the specific series of Debt
Securities being offered thereby, including, but not limited to, the following:
(i) the title of such Debt Securities; (ii) any limit upon the aggregate
principal amount of such Debt Securities; (iii) the date or dates on which the
principal of and premium, if any, on such Debt Securities will mature or the
method of determining such date or dates; (iv) the rate or rates (which may be
fixed or variable) at which such Debt Securities will bear interest, if any, or
the method of calculating such rate or rates; (v) the date or dates from which
interest, if any, will accrue or the method by which such date or dates will be
determined; (vi) the date or dates on which interest, if any, will be payable
and the record date or dates therefor; (vii) the place or places where principal
of, premium, if any, and interest, if any, on such Debt Securities will be
payable; (viii) the period or periods within which, the price or prices at
which, the currency or currencies (including currency unit or units) in which,
and the terms and conditions upon which, such Debt Securities may be redeemed,
in whole or in part, at the option of the Company; (ix) the obligation, if any,
of the Company to redeem or purchase such Debt Securities pursuant to any
sinking fund or analogous provisions or upon the happening of a specified event
and the period or periods within which, the price or prices at which and the
other terms and conditions upon which, such Debt Securities shall be redeemed or
purchased, in whole or in part, pursuant to such obligations; (x) the
denominations in which such Debt Securities are authorized to be issued if other
than $1,000 and any integral multiple thereof, in the case of registered Debt
Securities and if other than $5,000 and any integral multiple thereof, in the
case of bearer Debt Securities; (xi) if other than Dollars, the currency or
currencies (including currency units) in which Debt Securities may be
denominated and/or the currency or currencies (including currency units) in
which principal of, premium, if any, and interest, if any, on such Debt
Securities will be payable and whether the Company or the holders of any such
Debt Securities may elect to receive payments in respect of such Debt Securities
in a currency or currency unit other than that in which such Debt Securities are
stated to be payable; (xii) if other than the principal amount thereof, the
portion of the principal amount of such Debt Securities which will be payable
upon declaration of the acceleration of the maturity thereof or the method by
which such portion shall be determined; (xiii) the person to whom any interest
on any such Debt Security shall be payable if other than the person in whose
name such Debt Security is registered on the applicable record date; (xiv) any
addition to, or modification or deletion of, any Event of Default or any
covenant of the Company specified in the Indenture with respect to such Debt
Securities; (xv) the application, if any, of such means of defeasance or
covenant defeasance as may be specified for such Debt Securities; (xvi) whether
such Debt Securities are to be issued in whole or in part in the form of one or
more temporary or permanent global securities and, if so, the identity of the
depositary for such global security or securities; (xvii) under what
circumstances, if any, the Company will pay additional amounts on the Debt
Securities of that series held by a Person who is not a U.S. Person in respect
of taxes or similar charges withheld or deducted ("Additional Amounts") and, if
so, whether the Company will have the option to redeem such Debt Securities
rather than pay such Additional Amounts (and the terms of any such option);
(xviii) whether such Debt Securities shall be convertible into or exchangeable
for Common Stock, Preferred Stock or other securities and, if so, the terms of
such conversion or exchange and the terms of such other securities; and (xix)
any other special terms pertaining to such Debt Securities. Unless otherwise
specified in the applicable Prospectus Supplement, the Debt Securities will not
be listed on any securities exchange. (Section 3.01.)
Unless otherwise specified in the applicable Prospectus Supplement, Debt
Securities will be issued in fully-registered form without coupons. Where Debt
Securities of any series are issued in bearer form, the special restrictions and
considerations, including special offering restrictions and special Federal
income tax considerations, applicable to any such Debt Securities and to payment
on and transfer and exchange of such Debt Securities will be described in the
applicable Prospectus Supplement. Bearer Debt Securities will be transferable by
delivery. (Section 3.05.)
4
<PAGE>
Debt Securities may be sold at a substantial discount below their stated
principal amount, bearing no interest or interest at a rate which at the time of
issuance is below market rates. Certain Federal income tax consequences and
special considerations applicable to any such Debt Securities, or to Debt
Securities issued at par that are treated as having been issued at a discount,
will be described in the applicable Prospectus Supplement.
If the purchase price of any of the Debt Securities is payable in one or
more foreign currencies or currency units or if any Debt Securities are
denominated in one or more foreign currencies or currency units or if the
principal of, premium, if any, or interest, if any, on any Debt Securities is
payable in one or more foreign currencies or currency units, or by reference to
commodity prices, equity indices or other factors, the restrictions, elections,
certain Federal income tax considerations, specific terms and other information
with respect to such issue of Debt Securities and such foreign currency or
currency units or commodity prices, equity indices or other factors will be set
forth in the applicable Prospectus Supplement. In general, holders of such
series of Debt Securities may receive a principal amount on any principal
payment date, or a payment of premium, if any, on any premium interest payment
date or a payment of interest on any interest payment date, that is greater than
or less than the amount of principal, premium, if any, or interest otherwise
payable on such dates, depending on the value on such dates of the applicable
currency, commodity, equity index or other factor.
PAYMENT, REGISTRATION, TRANSFER AND EXCHANGE
Unless otherwise provided in the applicable Prospectus Supplement, payments
in respect of the Debt Securities will be made in the designated currency at the
office or agency of the Company maintained for that purpose as the Company may
designate from time to time. (Section 9.02.) Unless otherwise indicated in the
applicable Prospectus Supplement, payment of any installment of interest on Debt
Securities in registered form will be made to the person in whose name such Debt
Security is registered at the close of business on the regular record date for
such interest. (Section 3.07 (a).)
Payment in respect of Debt Securities in bearer form will be made in the
currency and in the manner designated in the applicable Prospectus Supplement,
subject to any applicable laws and regulations, at such paying agencies outside
the United States as the Company may appoint from time to time. The paying
agents outside the United States initially appointed by the Company for a series
of Debt Securities will be named in the Prospectus Supplement. The Company may
at any time designate additional paying agents or rescind the designation of any
paying agents, except that, if Debt Securities of a series are issuable as
Registered Securities, the Company will be required to maintain at least one
paying agent in each Place of Payment for such series and, if Debt Securities of
a series are issuable as Bearer Securities, the Company will be required to
maintain a paying agent in a Place of Payment outside the United States where
Debt Securities of such series and any coupons appertaining thereto may be
presented and surrendered for payment. (Section 9.02.)
Unless otherwise provided in the applicable Prospectus Supplement, Debt
Securities in registered form will be transferable or exchangeable at the agency
of the Company maintained for such purpose as designated by the Company from
time to time. (Sections 3.05 and 9.02.) Debt Securities may be transferred or
exchanged without service charge, other than any tax or other governmental
charge imposed in connection therewith. (Section 3.05.)
GLOBAL DEBT SECURITIES
Unless otherwise specified in the applicable Prospectus Supplement, the Debt
Securities of a series may be issued in whole or in part in the form of one or
more fully registered global securities (a "Registered Global Security") that
will be deposited with a depository (the "Depository") or with a nominee for the
Depository identified in the applicable Prospectus Supplement. In such a case,
one or more Registered Global Securities will be issued in a denomination or
aggregate denominations equal to the portion of the aggregate principal amount
of outstanding Debt Securities of the series to be represented by such
Registered Global Security or Securities. (Section 3.03.) Unless and until it is
5
<PAGE>
exchanged in whole or in part for Debt Securities in definitive certificated
form, a Registered Global Security may not be registered for transfer or
exchange except as a whole by the Depository for such Registered Global Security
to a nominee of such Depository or by a nominee of such Depository to such
Depository or another nominee of such Depository or by such Depository or any
such nominee to a successor Depository for such series or a nominee of such
successor Depository and except in the circumstances described in the applicable
Prospectus Supplement. (Section 3.05.)
The specific terms of the depository arrangement with respect to any portion
of a series of Debt Securities to be represented by a Registered Global Security
will be described in the applicable Prospectus Supplement. Unless otherwise
specified in the applicable Prospectus Supplement, the Company expects that the
following provisions will apply to such depository arrangements.
Ownership of beneficial interests in a Registered Global Security will be
limited to participants or persons that may hold interests through participants
(as such term is defined below). Upon the issuance of any Registered Global
Security, and the deposit of such Registered Global Security with or on behalf
of the Depository for such Registered Global Security, the Depository will
credit, on its book-entry registration and transfer system, the respective
principal amounts of the Debt Securities represented by such Registered Global
Security to the accounts of institutions ("participants") that have accounts
with the Depository or its nominee. The accounts to be credited will be
designated by the underwriters or agents engaging in the distribution of such
Debt Securities or by the Company, if such Debt Securities are offered and sold
directly by the Company. Ownership of beneficial interests by participants in
such Registered Global Security will be shown on, and the transfer of such
beneficial interests will be effected only through, records maintained by the
Depository for such Registered Global Security or by its nominee. Ownership of
beneficial interests in such Registered Global Security by persons that hold
through participants will be shown on, and the transfer of such beneficial
interests within such participants will be effected only through, records
maintained by such participants. The laws of some jurisdictions require that
certain purchasers of securities take physical delivery of such securities in
certificated form. The foregoing limitations and such laws may impair the
ability to transfer beneficial interests in such Registered Global Security.
So long as the Depository for a Registered Global Security, or its nominee,
is the registered owner of such Registered Global Security, such Depository or
such nominee, as the case may be, will be considered the sole owner or holder of
the Debt Securities represented by such Registered Global Security for all
purposes under the applicable Indenture. Unless otherwise specified in the
applicable Prospectus Supplement and except as specified below, owners of
beneficial interests in such Registered Global Security will not be entitled to
have Debt Securities of the series represented by such Registered Global
Security registered in their names, will not receive or be entitled to receive
physical delivery of Debt Securities of such series in certificated form and
will not be considered the holders thereof for any purposes under the relevant
Indenture. (Section 3.08.) Accordingly, each person owning a beneficial interest
in such Registered Global Security must rely on the procedures of the Depository
and, if such person is not a participant, on the procedures of the participant
through which such person owns its interest, to exercise any rights of a holder
under the relevant Indenture. The Depository may grant proxies and otherwise
authorize participants to give or take any request, demand, authorization,
direction, notice, consent, waiver or other action which a holder is entitled to
give or take under the relevant Indenture. The Company understands that, under
existing industry practices, if the Company requests any action of holders or if
any owner of a beneficial interest in such Registered Global Security desires to
give any notice or take any action which a holder is entitled to give or take
under the relevant Indenture, the Depository would authorize the participants to
give such notice or take such action, and such participants would authorize
beneficial owners owning through such participants to give such notice or take
such action or would otherwise act upon the instructions of beneficial owners
owning through them.
Unless otherwise specified in the applicable Prospectus Supplement, payments
with respect to principal, premium, if any, and interest, if any, on Debt
Securities represented by a Registered Global
6
<PAGE>
Security registered in the name of a Depository or its nominee will be made to
such Depository or its nominee, as the case may be, as the registered owner of
such Registered Global Security.
The Company expects that the Depository for any Debt Securities represented
by a Registered Global Security, upon receipt of any payment of principal,
premium or interest, will immediately credit participants' accounts with
payments in amounts proportionate to their respective beneficial interests in
the principal amount of such Registered Global Security as shown on the records
of such Depository. The Company also expects that payments by participants to
owners of beneficial interests in such Registered Global Security held through
such participants will be governed by standing instructions and customary
practices, as is now the case with the securities held for the accounts of
customers registered in "street names," and will be the responsibility of such
participants. None of the Company, the Indenture Trustee or any agent of the
Company or the Indenture Trustee shall have any responsibility or liability for
any aspect of the records relating to or payments made on account of beneficial
interests of a Registered Global Security, or for maintaining, supervising or
reviewing any records relating to such beneficial interests. (Section 3.08.)
Unless otherwise specified in the applicable Prospectus Supplement, if the
Depository for any Debt Securities represented by a Registered Global Security
is at any time unwilling or unable to continue as Depository or ceases to be a
clearing agency registered under the Exchange Act and a duly registered
successor Depository is not appointed by the Company within 90 days, the Company
will issue such Debt Securities in definitive certificated form in exchange for
such Registered Global Security. In addition, the Company may at any time and in
its sole discretion determine not to have any of the Debt Securities of a series
represented by one or more Registered Global Securities and, in such event, will
issue Debt Securities of such series in definitive certificated form in exchange
for all of the Registered Global Security or Securities representing such Debt
Securities. (Section 3.05.)
The Debt Securities of a series may also be issued in whole or in part in
the form of one or more bearer global securities (a "Bearer Global Security")
that will be deposited with a depository, or with a nominee for such depository,
identified in the applicable Prospectus Supplement. Any such Bearer Global
Security may be issued in temporary or permanent form. (Section 3.04.) The
specific terms and procedures, including the specific terms of the depository
arrangement, with respect to any portion of a series of Debt Securities to be
represented by one or more Bearer Global Securities will be described in the
applicable Prospectus Supplement.
CONVERSION AND EXCHANGE
The terms, if any, on which Debt Securities of any series are convertible
into or exchangeable for shares of Common Stock, Preferred Stock or other
securities will be set forth in the applicable Prospectus Supplement related
thereto. Such terms may include provisions for conversion or exchange, either
mandatory, at the option of the holder or at the option of the Company, in which
the number of shares of Common Stock, Preferred Stock or other securities would
be calculated according to the market price of Common Stock, Preferred Stock or
other securities as of a time stated in the applicable Prospectus Supplement.
CONSOLIDATION, MERGER OR SALE BY THE COMPANY
Unless otherwise specified in the applicable Prospectus Supplement, the
Company shall not consolidate with or merge with or into any other corporation
or sell its assets substantially as an entirety, unless: (i) the corporation
formed by such consolidation or into which the Company is merged or the
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corporation which acquires its assets is organized and existing under the laws
of the United States or any state thereof; (ii) the corporation formed by such
consolidation or into which the Company is merged or which acquires the
Company's assets substantially as an entirety expressly assumes all of the
obligations of the Company under the Indenture and the Debt Securities; (iii)
immediately after giving effect to such transaction, no Default or Event of
Default exists and is continuing; and (iv) if, as a result of such transaction,
properties or assets of the Company would become subject to an encumbrance which
would not be permitted by the terms of any series of Debt Securities, the
Company or the successor corporation, as the case may be, shall take such steps
as are necessary to secure such Debt Securities equally and ratably with all
indebtedness secured thereunder. Upon any such consolidation, merger or sale,
the successor corporation formed by such consolidation, or into which the
Company is merged or to which such sale is made, shall succeed to, and be
substituted for the Company under the Indenture. (Section 7.01.)
EVENTS OF DEFAULT, NOTICE AND CERTAIN RIGHTS ON DEFAULT
The Indenture provides that, if an Event of Default specified therein occurs
with respect to the Debt Securities of any series and is continuing, the
Indenture Trustee for such series or the holders of 25% in aggregate principal
amount of all of the outstanding Debt Securities of that series, by written
notice to the Company (and to the Indenture Trustee for such series, if notice
is given by such holders of Debt Securities), may declare the principal of (or,
if the Debt Securities of that series are Original Issue Discount Securities or
Indexed Securities, such portion of the principal amount specified in the
Prospectus Supplement) and accrued interest on all the Debt Securities of that
series to be due and payable (provided, with respect to any Debt Securities
issued under the Indenture, that the payment of principal and interest on such
Debt Securities shall remain subordinated to the extent provided in the
Indenture). (Section 5.02.)
Unless otherwise specified in the applicable Prospectus Supplement, Events
of Default with respect to Debt Securities of any series are defined in the
Indenture as being: (i) default in payment of any interest on any Debt Security
of that series or any coupon appertaining thereto or any additional amount
payable with respect to Debt Securities of such series as specified in the
applicable Prospectus Supplement when the same becomes due and payable and the
same continues for 30 days; (ii) default in payment of principal, or premium, if
any, at maturity or on redemption or otherwise, or in the making of a mandatory
sinking fund payment of any Debt Securities of that series when due; (iii)
default for 60 days after notice to the Company by the Indenture Trustee for
such series, or by the holders of 25% in aggregate principal amount of the Debt
Securities of such series then outstanding to the Company and the Indenture
Trustee, in the performance of any other agreement or covenant (other than an
agreement or covenant for which non-compliance is elsewhere specifically dealt
with in this paragraph) in the Debt Securities of that series, in the Indenture
or in any supplemental indenture or board resolution referred to therein under
which the Debt Securities of that series may have been issued; (iv) a default
under any mortgage, agreement, indenture or instrument under which there may be
issued, or by which there may be evidenced any Debt of the Company, whether
existing now or in the future, in an aggregate principal amount then outstanding
of $25 million or more, which default (a) shall constitute a failure to pay any
portion of the principal of such Debt when due and payable after the expiration
of an applicable grace period with respect thereto or (b) shall result in such
Debt becoming or being declared due and payable, and such acceleration shall not
be rescinded or annulled, or such Debt shall not be paid in full within a period
of 30 days after there has been given, to the Company by the Indenture Trustee
or to the Company and the Indenture Trustee by the holders of at least 25% in
aggregate principal amount of the Outstanding Debt Securities of such series
PROVIDED that such Event of Default will be remedied, cured or waived if the
default that resulted in the acceleration of such other indebtedness is
remedied, cured or waived; and (v) certain events of bankruptcy, insolvency or
reorganization of the Company. (Section 5.01.) The definition of "Event of
Default" in the Indenture specifically excludes a default under a secured debt
under which the obligee has recourse (exclusive of
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recourse for ancillary matters such as environmental indemnities, misapplication
of funds, costs of enforcement, etc.) only to the collateral pledged for
repayment, and where the fair market value of such collateral does not exceed
two percent of Total Assets (as defined in the Indenture) of the Company at the
time of the default. Events of Default with respect to a specified series of
Debt Securities may be added to the Indenture and, if so added, will be
described in the applicable Prospectus Supplement. (Sections 3.01 and 5.01(7).)
At any time after a declaration of acceleration has been made with respect
to Debt Securities of any series but before a judgment or decree for payment has
been obtained by the Indenture Trustee, the Holders of a majority in principal
amount of Outstanding Debt Securities of that series may rescind any declaration
of acceleration and its consequences, provided that all payments due (other than
those due as a result of acceleration) have been made and all Events of Default
have been cured or waived. (Section 5.02.)
The Indenture provides that the Indenture Trustee will, within 90 days after
the occurrence of a Default with respect to the Debt Securities of any series,
give to the holders of the Debt Securities of that series notice of all Defaults
known to it unless such Default shall have been cured or waived; provided that
except in the case of a Default in payment on the Debt Securities of that
series, the Indenture Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
such notice is in the interests of the holders of the Debt Securities of that
series. (Section 6.06.) "Default" means any event which is, or after notice or
passage of time or both, would be, an Event of Default. (Section 1.01.)
The Indenture provides that the holders of a majority in aggregate principal
amount of the Debt Securities of each series affected (with each such series
voting as a class) may, subject to certain limited conditions, direct the time,
method and place of conducting any proceeding for any remedy available to the
Indenture Trustee, or exercising any trust or power conferred on the Indenture
Trustee. (Section 5.08.)
The Indenture includes a covenant that the Company will file annually with
the Indenture Trustee a certificate as to the Company's compliance with all
conditions and covenants of the Indenture. (Section 9.05.)
The holders of a majority in aggregate principal amount of any series of
Debt Securities by notice to the Indenture Trustee for such series may waive, on
behalf of the holders of all Debt Securities of such series, any past Default or
Event of Default with respect to that series and its consequences except a
Default or Event of Default in the payment of the principal of, premium, if any,
or interest, if any, or any Additional Amounts on any Debt Security, and except
in respect of an Event of Default resulting from the breach of a covenant or
provision of either Indenture which, pursuant to the applicable Indenture,
cannot be amended or modified without the consent of the holders of each
outstanding Debt Security of such series affected. (Section 5.07.)
MODIFICATION OF THE INDENTURE
Unless otherwise specified in the applicable Prospectus Supplement, the
Indenture contains provisions permitting the Company and the Indenture Trustee
to enter into one or more supplemental indentures without the consent of the
holders of any of the Debt Securities in order (i) to evidence the succession of
another corporation to the Company and the assumption of the covenants and
obligations of the Company under the Indenture and the Debt Securities by a
successor to the Company; (ii) to add to the covenants of the Company or
surrender any right or power of the Company; (iii) to add additional Events of
Default with respect to any series of Debt Securities; (iv) to add or change any
provisions to such extent as necessary to permit or facilitate the issuance of
Debt Securities in bearer form; (v) to change or eliminate any provision
affecting only Debt Securities not yet issued; (vi) to establish the form or
terms of Debt Securities; (vii) to evidence and provide for successor Indenture
Trustee; (viii) if allowed without penalty under applicable laws and
regulations, to permit payment in respect of Debt Securities in bearer form in
the United States;
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(ix) to correct any defect or supplement any inconsistent provisions or to make
any other provisions with respect to matters or questions arising under the
Indenture, provided that such action does not adversely affect the interests of
any holder of Debt Securities of any series; or (x) to cure any ambiguity or
correct any mistake. The Indenture also permits the Company and the Indenture
Trustee thereunder to enter into such supplemental indentures to modify the
subordination provisions contained in the Indenture except in a manner adverse
to any outstanding Debt Securities. (Section 8.01.)
Unless otherwise specified in the applicable Prospectus Supplement, the
Indenture also contains provisions permitting the Company and the Indenture
Trustee, with the consent of the holders of a majority in aggregate principal
amount of the outstanding Debt Securities of each series affected by such
supplemental indenture (with the Debt Securities of each series voting as a
class), to execute supplemental indentures adding any provisions to or changing
or eliminating any of the provisions of the Indenture or any supplemental
indenture or modifying the rights of the holders of Debt Securities of such
series, except that, without the consent of the holder of each Debt Security so
affected, no such supplemental indenture may: (i) change the time for payment of
principal or premium, if any, or interest or any Additional Amounts on any Debt
Security; (ii) reduce the principal of, or any installment of principal of, or
premium, if any, or interest or any Additional Amounts on any Debt Security, or
change the manner in which the amount of any of the foregoing is determined;
(iii) reduce the amount of premium, if any, payable upon the redemption of any
Debt Security; (iv) reduce the amount of principal payable upon acceleration of
the maturity of any Original Issue Discount or Index Security; (v) change the
currency or currency unit in which any Debt Security or any premium or interest
or any Additional Amounts thereon is payable; (vi) impair the right to institute
suit for the enforcement of any payment on or with respect to any Debt Security;
(vii) reduce the percentage in principal amount of the outstanding Debt
Securities affected thereby the consent of whose holders is required for
modification or amendment of the Indenture or for waiver of compliance with
certain provisions of the Indenture or for waiver of certain defaults; (viii)
change the obligation of the Company to maintain an office or agency in the
places and for the purposes specified in the Indenture; (ix) modify the
provisions relating to the subordination of outstanding Debt Securities of any
series in a manner adverse to the holders thereof; or (x) modify the provisions
relating to waiver of certain defaults or any of the foregoing provisions.
(Section 8.02.)
SUBORDINATION UNDER THE INDENTURE
The Indenture provides that any Subordinated Debt issued thereunder are
subordinate in right of payment to all Senior Indebtedness to the extent
provided in the Indenture. (Section 12.01.) The Indenture defines the term
"Senior Indebtedness" as: (i) all indebtedness of the Company, whether
outstanding on the date of the Indenture or thereafter created, incurred or
assumed, which is for money borrowed, or evidenced by a note or similar
instrument given in connection with the acquisition of any business, properties
or assets, including securities; (ii) any indebtedness of others of the kinds
described in the preceding clause (i) the payment of which the Company is
responsible or liable as guarantor or otherwise; and (iii) amendments, renewals,
extensions and refundings of any such indebtedness, unless in any instrument or
instruments evidencing or securing such indebtedness or pursuant to which the
same is outstanding. The Senior Indebtedness shall continue to be Senior
Indebtedness and entitled to the benefits of the subordination provisions
irrespective of any amendment, modification or waiver of any term of the Senior
Indebtedness or extension or renewal of the Senior Indebtedness. Senior
Indebtedness does not include (a) any indebtedness of the Company to any of its
subsidiaries, (b) liabilities incurred in the ordinary course of business of the
Company, (c) any indebtedness which by its terms is expressly made PARI PASSU in
right of payment with or subordinated to any other Subordinated Debt. (Section
12.02.)
If (i) the Company defaults in the payment of any principal, interest, if
any or premium, if any, or any Additional Amounts on any Senior Indebtedness
when the same becomes due and payable,
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whether at maturity or at a date fixed for prepayment or declaration or
otherwise or (ii) an event of default occurs with respect to any Senior
Indebtedness permitting the holders thereof to accelerate the maturity thereof
and written notice of such event of default (requesting that payments on
Subordinated Debt cease) is given to the Company by the holders of Senior
Indebtedness, then unless and until such default in payment or event of default
shall have been cured or waived or shall have ceased to exist, no direct or
indirect payment (in cash, property or securities, by set-off or otherwise)
shall be made or agreed to be made on account of the Subordinated Debt or
interest thereon or in respect of any repayment, redemption, retirement,
purchase or other acquisition of Subordinated Debt. (Section 12.04.)
In the event of (i) any insolvency, bankruptcy, receivership, liquidation,
reorganization, readjustment, composition or other similar proceeding relating
to the Company or its property, (ii) any proceeding for the liquidation,
dissolution or other winding-up of the Company, voluntary or involuntary,
whether or not involving insolvency or bankruptcy proceedings, (iii) any
assignment by the Company for the benefit of creditors or (iv) any other
marshaling of the assets of the Company, all Senior Indebtedness (including,
without limitations interest accruing after the commencement of any such
proceeding, assignment or marshaling of assets) shall first be paid in full or
provision must be made for such payment in cash or cash equivalents or otherwise
in a manner satisfactory to the holders of Senior Indebtedness before any
payment or distribution, whether in cash, securities or other property, shall be
made by the Company on account of Subordinated Debt. In any such event, any
payment or distribution, whether in cash, securities or other property (other
than securities of the Company or any other corporation provided for by a plan
of reorganization or readjustment, the payment of which is subordinate, at least
to the extent provided in the subordination provisions of the Indenture with
respect to the indebtedness evidenced by Subordinated Debt, to the payment of
all Senior Indebtedness at the time outstanding and to any securities issued in
respect thereof under any such plan of reorganization or readjustment), which
would otherwise (but for the subordination provisions) be payable or deliverable
in respect of Subordinated Debt (including any such payment or distribution
which may be payable or deliverable by reason of the payment of any other
indebtedness of the Company being subordinated to the payment of Subordinated
Debt) shall be paid or delivered directly to the holders of Senior Indebtedness,
or to their representative or trustee, in accordance with the priorities then
existing among such holders until all Senior Indebtedness shall have been paid
in full. (Section 12.03.) No present or future holder of any Senior Indebtedness
shall be prejudiced in the right to enforce subordination of the indebtedness
evidenced by Subordinated Debt by any act or failure to act on the part of the
Company. (Section 12.11.)
Senior Indebtedness shall not be deemed to have been paid in full unless the
holders thereof shall have received cash, securities or other property equal to
the amount of such Senior Indebtedness then outstanding. Upon the payment in
full of all Senior Indebtedness, the holders of Subordinated Debt shall be
subrogated to all the rights of any holders of Senior Indebtedness to receive
any further payments or distributions applicable to the Senior Indebtedness
until all Subordinated Debt shall have been paid in full, and such payments or
distributions received by any holder of Subordinated Debt, by reason of such
subrogation, of cash, securities or other property which otherwise would be paid
or distributed to the holders of Senior Indebtedness, shall, as between the
Company and its creditors other than the holders of Senior Indebtedness, on the
one hand, and the holders of Subordinated Debt, on the other, be deemed to be a
payment by the Company on account of Senior Indebtedness, and not on account of
Subordinated Debt. (Section 12.06.)
The Indenture provides that the foregoing subordination provisions, insofar
as they relate to any particular issue of Subordinated Debt, may be changed
prior to such issuance. Any such change would be described in the applicable
Prospectus Supplement relating to such Subordinated Debt.
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DEFEASANCE AND COVENANT DEFEASANCE
If indicated in the applicable Prospectus Supplement, the Company may elect
either (i) to defease and be discharged from any and all obligations with
respect to the Debt Securities of or within any series (except as otherwise
provided in the relevant Indenture) ("defeasance") or (ii) to be released from
its obligations with respect to certain covenants applicable to the Debt
Securities of or within any series ("covenant defeasance"), upon the deposit
with the Indenture Trustee (or other qualifying trustee), in trust for such
purpose, of money and/or Government Obligations which through the payment of
principal, interest, premium, if any, and any Additional Amounts in accordance
with their terms will provide money in an amount sufficient, without
reinvestment, to pay the principal of, any premium or interest on and any
Additional Amounts on such Debt Securities and any coupons appertaining thereto
on the Maturity or redemption, as the case may be, and any mandatory sinking
fund or analogous payments thereon. As a condition to defeasance or covenant
defeasance, the Company must deliver to the Indenture Trustee an Opinion of
Counsel to the effect that the Holders of such Debt Securities will not
recognize income, gain or loss for Federal income tax purposes as a result of
such defeasance or covenant defeasance and will be subject to Federal income tax
on the same amounts and in the same manner and at the same times as would have
been the case if such defeasance or covenant defeasance had not occurred. Such
Opinion of Counsel, in the case of defeasance under clause (i) above, must refer
to and be based upon a ruling of the Internal Revenue Service or a change in
applicable Federal income tax law occurring after the date of the relevant
Indenture. (Article IV.) If indicated in the applicable Prospectus Supplement,
in addition to obligations of the United States or an agency or instrumentality
thereof, Government Obligations may include obligations of the government or an
agency or instrumentality of the government issuing the currency or currency
unit in which Debt Securities of such series are payable. (Section 3.01.)
In addition, with respect to the Indenture, in order to be discharged no
event or condition shall exist that, pursuant to certain provisions described
under "--Subordination under the Indenture" above, would prevent the Company
from making payments of principal of (and premium, if any) and interest, if any,
and any Additional Amounts on Subordinated Debt at the date of the irrevocable
deposit referred to above. (Section 4.06.)
The Company may exercise its defeasance option with respect to such Debt
Securities notwithstanding its prior exercise of its covenant defeasance option.
If the Company exercises its defeasance option, payment of such Debt Securities
may not be accelerated because of a Default or an Event of Default. (Section
4.04.) If the Company exercises its covenant defeasance option, payment of such
Debt Securities may not be accelerated by reason of a Default or an Event of
Default with respect to the covenants to which such covenant defeasance is
applicable. However, if such acceleration were to occur by reason of another
Event of Default, the realizable value at the acceleration date of the money and
Government Obligations in the defeasance trust could be less than the principal
and interest then due on such Debt Securities, in that the required deposit in
the defeasance trust is based upon scheduled cash flow rather than market value,
which will vary depending upon interest rates and other factors.
THE TRUSTEE
Unless otherwise specified in the applicable Prospectus Supplement, a
trustee of national reputation will be the Indenture Trustee under the
Indenture. The Company may also maintain banking and other commercial
relationships with the Trustee and its affiliates in the ordinary course of
business.
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DESCRIPTION OF CAPITAL STOCK
The following description does not purport to be complete and is qualified
in its entirety by reference to the Company's Certificate of Incorporation
("Certificate") and By-laws.
GENERAL
Under the Certificate of Incorporation, the Company's authorized capital
stock consists of 100,000,000 shares of Common Stock, par value $.01 per share,
and 10,000,000 shares of Preferred Stock, par value $.01 per share. The
following description is a summary and is qualified in its entirety by the
provisions of the Company's Certificate and By-laws, which are included as
exhibits to the Company's Registration Statement of which this Prospectus is a
part.
COMMON STOCK
DIVIDEND AND VOTING RIGHTS
Holders of Common Stock are entitled to one vote for each share of Common
Stock held on each matter submitted to a vote of stockholders including the
election of directors, and have no preemptive rights to subscribe for additional
shares from the Company. Voting rights are not cumulative, with the result that
holders of more than 50% of the shares of Common Stock are able to elect all of
the Company's directors. Holders of Common Stock are entitled to receive
dividends out of funds legally available therefor when, as and if declared by
the Board of Directors and to receive pro rata the net assets of the Company
legally available for distribution upon liquidation or dissolution. The
Company's revolving credit facility places certain restrictions on the payment
of dividends.
LIQUIDATION AND REDEMPTION RIGHTS
The Company has granted its lenders security interests in a substantial
portion of the Company's assets under the revolving credit facility. Subject to
the prior rights of creditors and the holders of any preferred stock which may
be outstanding from time to time, the holders of the Common Stock are entitled
to share PRO RATA in the distribution of any remaining assets in the event of
liquidation, dissolution or winding up of the Company. The shares of Common
Stock are subject to redemption at Fair Market Value (as defined in the
Certificate) by the Company if the Board determines that such redemption is
necessary to prevent the loss or secure the restatement of any license or
franchise from any governmental agency, which license or franchise is
conditional upon some or all holders meeting certain prescribed qualifications.
OPTIONS TO PURCHASE COMMON STOCK
The Company has granted options to purchase shares of Common Stock to
certain employees and directors pursuant to employee and non-employee director
stock option plans. The Company has also granted options to a former executive
officer of Fingerhut.
OTHER
All shares of Common Stock offered hereby will, when issued, be fully paid
and non-assessable. The Common Stock is listed on The Nasdaq Stock Market under
the symbol "MTRS."
The Prospectus Supplement relating to an offering of Common Stock will
describe terms relevant thereto, including the number of shares offered, the
initial offering price, market price and dividend information.
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PREFERRED STOCK
The Certificate authorizes the Company's Board of Directors to issue up to
an aggregate of 10,000,000 shares of Preferred Stock in one or more series, with
such voting rights, liquidation preferences, dividend rights, repurchase rights,
conversion rights, redemption rights and terms and certain other rights and
preferences, as shall be determined by the Board of Directors in a resolution or
resolutions providing for the issue of such Preferred Stock. The Board of
Directors may issue any or all of such shares without the approval of the
holders of Common Stock.
The applicable Prospectus Supplement will describe the following terms of
any series of Preferred Stock in respect of which this Prospectus is being
delivered (to the extent applicable to such Preferred Stock): (i) the specific
designation, number of shares, seniority and initial public offering or purchase
price; (ii) any liquidation preference per share; (iii) any date of maturity;
(iv) any redemption, repayment or sinking fund provisions; (v) any dividend rate
or rates and the dates on which any such dividends will be payable (or the
method by which such rates or dates will be determined) and whether such
dividends will be cumulative or non-cumulative; (vi) any voting rights (which
may not exceed one vote per share); (vii) if other than the currency of the
United States of America, the currency or currencies, including currency units
and composite currencies, in which such Preferred Stock is denominated and/or in
which payments will or may be payable; (viii) the method by which amounts in
respect of such Preferred Stock may be calculated and any commodities,
currencies or indices, or value, rate or price, relevant to such calculation;
(ix) whether the Preferred Stock is convertible or exchangeable and, if so, the
securities or rights into which such Preferred Stock is convertible or
exchangeable (which may include other Preferred Stock, Common Stock or other
securities or rights of the Company (including rights to receive payment in cash
or securities based on the value, rate or price of one or more specified
commodities, currencies or indices) or a combination of the foregoing), and the
terms and conditions upon which such conversions or exchanges will be effected,
including the initial conversion or exchange prices or rates, the conversion or
exchange period and any other related provisions; (x) the place or places where
dividends and other payments on the Preferred Stock will be payable; and (xi)
any additional voting, dividend, liquidation, redemption and other rights,
preferences, privileges, limitations and restrictions.
All shares of Preferred Stock offered hereby, or issuable upon conversion,
exchange or exercise of Securities, will, when issued, be fully paid and
non-assessable.
No shares of Preferred Stock are currently issued or outstanding. However,
the Company has designated 1,000,000 shares of Preferred Stock as Series A
Junior Participating Preferred Stock, which may be issued upon the exercise of
certain Rights attached to each share of Common Stock. See "Stockholders Rights
Plan."
STOCKHOLDERS RIGHTS PLAN
The Board of Directors of the Company has adopted a stockholders rights
plan. Under the stockholders rights plan, each share of Common Stock has
associated with it one preferred share purchase right (a "Right"). The terms of
the Rights are set forth in a Rights Agreement (the "Rights Agreement") between
the Company and Norwest Bank Minnesota, N.A. Under certain circumstances
described below, each Right would entitle the holder thereof to purchase one
one-hundredth of a share of the Company's Series A Junior Participating
Preferred Stock (the "Series A Preferred Shares") for a price of $250.00 (two
hundred and fifty dollars) per one one-hundredth of a share. The Rights are not
presently exercisable and are transferable only with the related shares of
Common Stock. The Rights will not become exercisable or be evidenced by separate
certificates or traded separately from the shares of Common Stock prior to the
occurrence of certain triggering
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events described below. In such an event, separate Rights certificates would be
issued and distributed representing one Right for each share of Common Stock.
There is no present market for the Rights separate from the shares of Common
Stock and the Company cannot predict whether a trading market would develop with
respect to the Rights if the Rights ever become exercisable.
The Rights would become exercisable at the specified exercise price upon the
earliest to occur of (i) 10 days after the first public announcement that any
person or group has become a Beneficial Owner (as defined in the Rights
Agreement) of 15% or more of the outstanding shares of Common Stock then
outstanding (other than certain persons or entities related to the Company each
an "Exempt Person") (an "Acquiring Person") and (ii) 10 days (or such later date
as may be determined by the Board of Directors of the Company) after any person
or group (other than an Exempt Person) has first published or commenced a tender
or exchange offer which would, upon its consummation, result in such person or
group being the Beneficial Owner of 15% or more of the outstanding shares of
Common Stock (each a "Triggering Event"). Rights may not be exercised following
the occurrence of an event described below under the caption "Flip-in" prior to
the expiration of the Company's rights to redeem the Rights. Rights certificates
will be distributed when the Rights become exercisable.
VOIDING. All Rights which are, or (under certain circumstances specified in
the Rights Agreement) were, Beneficially Owned by an Acquiring Person (or
certain affiliates or associates thereof or transferees therefrom) will become
void upon the occurrence of the event described below under the caption
"Flip-In."
FLIP-IN. If any person or group becomes an Acquiring Person, each Right,
(other than a Right which has become void) will entitle the registered holder
thereof to purchase shares of Common Stock having a value equal to two times the
exercise price of the Rights.
FLIP OVER. In the event that, on or after the date on which an Acquiring
Person has become such: (i) the Company merges into or consolidates with any
other person (with limited designated exceptions), (ii) any other person (with
limited designated exceptions) merges into or consolidates with the Company and
the shares of Common Stock are converted into securities of another person, cash
or other property or (iii) the Company sells or transfers 50% or more of its
consolidated assets or earning power to any other person (with limited
designated exceptions), the holders of the Rights (other than Rights which have
become void) would be entitled to purchase common shares of the acquiror (or a
person affiliated therewith) at a 50% discount.
REDEMPTION OF RIGHTS. The Rights may be redeemed, as a whole, at a
redemption price of $.01 per right, subject to adjustment, at the direction of
the Board of Directors of the Company, at any time prior to the earliest of (i)
10 days after the first public announcement that any person has become an
Acquiring Person and (ii) the date of final expiration of the Rights, which is
September 25, 2008.
EXCHANGE OF SHARES FOR RIGHTS. At any time after any person or group shall
have become an Acquiring Person and before any person (other than an Exempt
Person), together with its affiliates and associates, shall have become the
Beneficial Owner of 50% or more of the outstanding shares of Common Stock, the
Board of Directors of the Company may direct the exchange of shares of Common
Stock (or Series A Preferred Shares) for all or any part of the Rights (other
than Rights which have become void) at the exchange rate of one share of Common
Stock (or one one-hundredth of a Series A Preferred Share) per Right, subject to
adjustment.
TERMS OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK. The Series A
Preferred Shares which would be issuable upon exercise of the Rights (should the
rights become exercisable) would not be redeemable. Each Series A Preferred
Share would entitle the holder thereof to receive a preferential
15
<PAGE>
quarterly dividend equal to the greater of (i) $.01 or (ii) 100 times the
aggregate per share amount of all cash dividends, plus 100 times the aggregate
per share amount (payable in kind) of all non-cash dividends and other
distributions (other than in shares of Common Stock), declared on the shares of
Common Stock during such quarter, adjusted to give effect to any dividend on the
shares of Common Stock payable in shares of Common Stock or any subdivision or
combination of the shares of Common Stock (a "Dilution Event"). Each Series A
Preferred Share should entitle the holder thereof to 100 votes on all matters
submitted to a vote of the stockholders of the Company, voting together as a
single class with the holders of the Common Stock, adjusted to give effect to
any Dilution Event. In the event of liquidation of the Company, the holder of
each Series A Preferred Share would be entitled to receive a preferential
liquidation payment equal to $100, adjusted to give effect to any Dilution
Event, plus an amount equal to acquired and unpaid dividends and distributions
on such Series A Preferred Share, whether or not declared, to the date of such
payment. In the event of any merger, consolidation or other transaction in which
the outstanding shares of Common Stock are exchanged for or converted into other
capital stock, securities, cash and/or other property, each Series A Preferred
Share would be similarly exchanged or converted into 100 times the per share
amount applicable to the Common Stock, adjusted to give effect to any Dilution
Event.
CERTAIN PROVISIONS OF THE COMPANY'S CERTIFICATE AND BY-LAWS
The following discussion is a summary of certain provisions of the
Certificate and By-laws of the Company relating to stockholder voting rights,
advance notice requirements and other provisions which may be deemed to have an
"anti-takeover" effect. These and other provisions affect stockholder rights and
should be given careful attention. The following description of certain of these
provisions is necessarily general and is qualified in its entirety by reference
to the Certificate and By-laws, copies of which are included as exhibits to the
Registration Statement of which this Prospectus is a part.
DIRECTORS' LIABILITY
The Certificate provides that, to the fullest extent permitted by the
Delaware General Corporation Law, a director of the Company shall not be
personally liable to the Company or its stockholders for monetary damages for
any breach of the director's fiduciary duty as a director to the corporation or
its stockholders. In addition, the Certificate and By-laws include certain
provisions whereby directors and officers of the Company generally shall be
indemnified against certain liabilities to the fullest extent permitted or
required by the Delaware General Corporation Law. Insofar as these provisions
permit indemnification for liabilities arising under the Securities Act of 1933,
as amended (the "Securities Act"), the Company has been advised that, in the
opinion of the SEC, such indemnification is against public policy as expressed
in such Act and is, therefore, unenforceable.
As a result of these provisions, the Company and its stockholders may be
unable to obtain monetary damages from a director for breach of duty of care.
Although stockholders may continue to seek injunctive or other equitable relief
for an alleged breach of fiduciary duty by a director, stockholders may not have
any effective remedy against the challenged conduct if equitable remedies are
unavailable.
ANTI-TAKEOVER EFFECTS OF PROVISIONS OF THE COMPANY'S CERTIFICATE AND BY-LAWS
Certain provisions of the Company's Certificate and By-laws could have an
anti-takeover effect. These provisions are intended to enhance the likelihood of
continuity and stability in the composition of the Company's Board of Directors
and in the policies formulated by the Board. They are also designed to
discourage an unsolicited takeover of the Company if the Board determines that
such
16
<PAGE>
takeover is not in the best interests of the Company and its stockholders. These
provisions, however, could have the effect of discouraging certain attempts to
acquire the Company or remove incumbent management even if some or a majority of
stockholders deemed such an attempt to be in their best interests.
Pursuant to the Certificate, the Board of Directors of the Company is
divided into three classes serving staggered three-year terms. Such Directors
may be removed from office only for cause and only by the affirmative vote of
the holders of a majority of the then outstanding shares of voting stock
together as a single class. Vacancies on the Board of Directors may be filled
only by the remaining directors and not by the stockholders.
The By-laws establish an advance notice procedure, which took effect on
September 25, 1998, for the nomination, other than by or at the direction of the
Board of Directors, of candidates for election as directors as well as for other
stockholder proposals to be considered at the annual meeting of stockholders. In
general, notice must be received by the Company not less than 50 days nor more
than 75 days prior to the meeting and must contain certain specified information
concerning the persons to be nominated or the matters to be brought before the
meeting and concerning the stockholder submitting the proposal.
Certain transactions with the Company may be subject to Section 203 of the
Delaware General Corporation Law. Section 203 prohibits certain "business
combinations" between an "interested stockholder" and a corporation for three
years after a stockholder becomes interested, unless one of the statute's
exceptions applies. Section 203 (c) (5) defines an interested stockholder as a
person, broadly defined to include a group, who owns at least 15% of a company's
outstanding voting stock. The statute defines business combinations expansively
to include any merger or consolidation of, with, or caused by the interested
stockholder. Section 203 (a) provides three exceptions to the business
combination prohibition. First, there is no constraint if the interested
stockholder obtains prior board approval for the business combination or the
transaction resulting in ownership of 15% of the target's voting stock. Second,
the statute does not apply if, in completing the transaction that crosses the
15% threshold, the stockholder becomes the owner of 85% of the corporation's
voting stock outstanding as of the time the transaction commenced. The statute
provides that any shares owned by directors who are officers, and shares owned
by certain stock option plans are excluded from the calculation; this exception
applies most particularly to a tender offeror who has less than 15% of the
target's stock and receives tenders that satisfy the 85% requirement. Finally,
the statute does not apply if the interested stockholder's business combination
is approved by the board of directors and affirmed by at least 66 2/3% of the
outstanding voting stock not owned by the interested stockholder.
LIMITATIONS ON THE COMPANY'S BUSINESS ACTIVITIES
The Company's Certificate provides that, at any time prior to the date
immediately following the third annual meeting of stockholders to be held after
Fingerhut Companies, Inc. ("FCI") no longer beneficially owns in the aggregate
50% or more of the Company's voting stock, the Company shall not, directly or
indirectly (through a subsidiary of, or any other person controlled by, the
Company) for its own account or that of another, engage in managing, selling,
distributing, marketing, administering, leasing or otherwise providing products
or services other than the following: (i) general purpose payment cards
including without limitation, credit cards, secured bank credit cards, prepaid
cards, debit cards, co-branded cards, and affinity bank credit cards; (ii)
extended service plans, credit enhancement products and warranties; (iii) credit
card registration; (iv) car buying services, shopping club memberships and
dining club memberships; (v) insurance products; (vi) mailing lists and other
lists of prospects for solicitation; (vii) advertising on or accompanying
monthly billing statements sent to customers of the Company; (viii) tax
preparation services; (ix) investment products and services including without
limitation deposit products, certificates of
17
<PAGE>
deposit, annuities, and mutual funds; (x) investment and other brokerage
services; (xi) consumer loans and leases including without limitation mobile
home financing, automobile lending and leasing, equity loans and mortgages, and
student loans, provided that the Company shall not offer any closed-end
installment or revolving credit loans to Fingerhut Customers for the exclusive
purchase of FCI merchandise; and (xii) mail-grams, travelers checks, money
orders, and travel services.
In addition to the above specified activities, the Certificate permits the
Company to engage in any other business or activity with the consent of FCI or
majority vote of the Company's stockholders. The Certificate further provides
that no person shall be liable for breach of any fiduciary duty, as a
stockholder of the Company or controlling person of a stockholder or otherwise,
by reason of such person authorizing, or not authorizing, the Company to engage
in any business or activity.
PLAN OF DISTRIBUTION
The Company may sell any of the Securities being offered hereby in any one
or more of the following ways from time to time: (i) through agents; (ii) to or
through underwriters; (iii) through dealers; or (iv) directly to purchasers.
The Prospectus Supplement with respect to the Securities will set forth the
terms of the offering of the Securities, including the name or names of any
underwriters, dealers or agents; the purchase price of the Securities and the
proceeds to the Company from such sale; any underwriting discounts and
commissions or agency fees and other items constituting underwriters' or agents'
compensation; any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers and any securities exchange on which
such Securities may be listed. Any initial public offering price, discounts or
concessions allowed or reallowed or paid to dealers may be changed from time to
time.
The distribution of the Securities may be effected from time to time in one
or more transactions at a fixed price or prices, which may be changed, at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices.
Offers to purchase Securities may be solicited by agents designated by the
Company from time to time. Any such agent involved in the offer or sale of the
Securities in respect of which this Prospectus is delivered will be named, and
any commissions payable by the Company to such agent will be set forth, in the
applicable Prospectus Supplement. Unless otherwise indicated in such Prospectus
Supplement, any such agent will be acting on a reasonable best efforts basis for
the period of its appointment. Any such agent may be deemed to be an
underwriter, as that term is defined in the Securities Act, of the Securities so
offered and sold.
If Securities are sold by means of an underwritten offering, the Company
will execute an underwriting agreement with an underwriter or underwriters at
the time an agreement for such sale is reached, and the names of the specific
managing underwriter or underwriters, as well as any other underwriters, and the
terms of the transaction, including commissions, discounts and any other
compensation of the underwriters and dealers, if any, will be set forth in the
applicable Prospectus Supplement which will be used by the underwriters to make
resales of the Securities in respect of which this Prospectus is delivered to
the public. If underwriters are utilized in the sale of the Securities in
respect of which this Prospectus is delivered, the Securities will be acquired
by the underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at fixed public
offering prices or at varying prices determined by the underwriter at the time
of sale. Securities may be offered to the public either through underwriting
syndicates represented by managing underwriters or directly by the managing
underwriters. If any underwriter or underwriters are utilized in the sale of the
Securities, unless otherwise indicated in the Prospectus Supplement, the
underwriting agreement will provide that the obligations of the underwriters are
subject to certain conditions precedent and that the underwriters with
18
<PAGE>
respect to a sale of Securities will be obligated to purchase all such
Securities of a series if any are purchased.
If a dealer is utilized in the sales of the Securities in respect of which
this Prospectus is delivered, the Company will sell such Securities to the
dealer as principal. The dealer may then resell such Securities to the public at
varying prices to be determined by such dealer at the time of resale. Any such
dealer may be deemed to be an underwriter, as such term is defined in the
Securities Act, of the Securities so offered and sold. The name of the dealer
and the terms of the transaction will be set forth in the Prospectus Supplement
relating thereto.
Offers to purchase Securities may be solicited directly by the Company and
the sale thereof may be made by the Company directly to institutional investors
or others, who may be deemed to be underwriters within the meaning of the
Securities Act with respect to any resale thereof. The terms of any such sales
will be described in the Prospectus Supplement relating thereto.
Agents, underwriters and dealers may be entitled under relevant agreements
to indemnification or contribution by the Company against certain liabilities,
including liabilities under the Securities Act.
Agents, underwriters and dealers may be customers of, engage in transactions
with, or perform services for, the Company and its subsidiaries in the ordinary
course of business.
Securities may also be offered and sold, if so indicated in the applicable
Prospectus Supplement, in connection with a remarketing upon their purchase, in
accordance with a redemption or repayment pursuant to their terms, or otherwise,
by one or more firms ("remarketing firms"), acting as principals for their own
accounts or as agents for the Company. Any remarketing firm will be identified
and the terms of its agreement, if any, with its compensation will be described
in the applicable Prospectus Supplement. Remarketing firms may be deemed to be
underwriters, as such term is defined in the Securities Act, in connection with
the Securities remarketed thereby. Remarketing firms may be entitled under
agreements which may be entered into with the Company to indemnification or
contribution by the Company against certain civil liabilities, including
liabilities under the Securities Act, and may be customers of, engage in
transactions with or perform services for the Company and its subsidiaries in
the ordinary course of business.
If so indicated in the applicable Prospectus Supplement, the Company may
authorize agents, underwriters or dealers to solicit offers by certain types of
institutions to purchase Securities from the Company at the public offering
prices set forth in the applicable Prospectus Supplement pursuant to delayed
delivery contracts ("Contracts") providing for payment and delivery on a
specified date or dates in the future. A commission indicated in the applicable
Prospectus Supplement will be paid to underwriters, dealers and agents
soliciting purchases of Securities pursuant to Contracts accepted by the
Company.
VALIDITY OF SECURITIES
Unless otherwise indicated in the applicable Prospectus Supplement, the
validity of Securities will be passed upon for the Company by Sidley & Austin,
Chicago, Illinois.
EXPERTS
The consolidated financial statements of the Company as of December 31, 1997
and 1996, and for each of the years in the three-year period ended December 31,
1997, have been incorporated by reference herein in reliance upon the report of
KPMG Peat Marwick LLP, independent certified public accountants, which report is
also incorporated by reference herein, and upon the authority of said firm as
experts in accounting and auditing.
19
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C>
SEC registration fee.................... $221,250
The Nasdaq Stock Market fee............. 61,000
Legal fees and expenses................. 275,000
Accounting fees and expenses............ 100,000
Printing and engraving expenses......... 200,000
Trustee's fees and expenses............. 20,000
Rating agencies' fees................... 125,000
Blue Sky fees........................... 15,000
Miscellaneous........................... 82,750
--------
Total............................... $1,100,000
--------
--------
</TABLE>
Except for the SEC registration fee, all of the foregoing fees and expenses
are estimates and will vary depending upon the Securities issued pursuant to
this Registration Statement.
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS
Section 145 of the Delaware General Corporation Law ("DGCL") empowers a
Delaware corporation to indemnify any persons who are, or are threatened to be
made, parties to any threatened, pending or completed legal action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of such corporation), by reason of the fact that
such person was an officer or director of such corporation, or is or was serving
at the request of such corporation as a director, officer, employee or agent of
another corporation or enterprise. The indemnity may include expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action, suit or
proceeding, provided that such officer or director acted in good faith and in a
manner he reasonably believed to be in or not opposed to the corporation's best
interests, and, for criminal proceedings, had no reasonable cause to believe his
conduct was illegal. A Delaware corporation may indemnify officers and directors
in an action by or in the right of the corporation under the same conditions,
except that no indemnification is permitted without judicial approval if the
officer or director is adjudged to be liable to the corporation in the
performance of his duty. Where an officer or director is successful on the
merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him against the expenses which such officer or
director actually and reasonably incurred.
In accordance with the DGCL, the Certificate of the Company contains a
provision to limit the personal liability of the directors of the Company for
violations of their fiduciary duty. This provision eliminates each director's
liability to the Company or its stockholders for monetary damages except to the
extent provided by the DGCL (i) for any breach of the director's duty of loyalty
to the Company or its stockholders, (ii) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law, (iii)
under section 174 of the DGCL providing for liability of directors for unlawful
payment of dividends or unlawful stock purchases or redemptions, or (iv) for any
transaction from which a director derived an improper benefit. The effect of
this provision is to eliminate the personal liability of directors for monetary
damages for actions involving a breach of their fiduciary duty of care,
including any such actions involving gross negligence.
The Certificate and the By-laws of the Company provide for indemnification
of the Company's officers and directors to the fullest extent permitted by
applicable law. In addition, the Company
II-1
<PAGE>
intends to purchase insurance policies which will provide coverage for its
officers and directors in certain situations where the Company cannot directly
indemnify such officers or directors.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- ------- ------------------------------------------------------------
<C> <S>
1.1** Form of Underwriting Agreement--Debt Securities.
1.2** Form of Underwriting Agreement--Equity Securities.
3.1 Amended and Restated Certificate of Incorporation of the
Company is incorporated herein by reference to Exhibit 3.a.
to the Company's Registration Statement on Form S-1 (File
No. 333-10831).
3.2 Amended and Restated By-laws of the Company are incorporated
herein by reference to Exhibit 4.2 to the Company's
Registration Statement on Form S-8 (File No. 333-52627).
4.1* Form of Certificate for shares of Common Stock of the
Company.
4.2 Indenture by and among the Company, the Guarantors named
therein and The First National Bank of Chicago, as Indenture
Trustee, is incorporated herein by reference to Exhibit 4.1
to the Company's Registration Statement on Form S-4 (File
No. 333-43771).
4.3* Form of Indenture by and between the Company and an
Indenture Trustee to be designated, pursuant to which the
Subordinated Debt is to be issued.
4.4** Form of Debt Security. The form or forms of such Debt
Securities with respect to each particular offering will be
filed as an exhibit subsequently included or incorporated by
reference herein.
4.5** Form of Preferred Stock. Any amendment to the Company's
Amended and Restated Certificate of Incorporation
authorizing the creation of any series of Preferred Stock
and setting forth the rights, preferences and designations
thereof will be filed as an exhibit subsequently included or
incorporated by reference herein.
5.1* Opinion of Sidley & Austin.
10.1 Amended and Restated Credit Agreement among the Company and
the Lenders Named Therein is incorporated herein by
reference to Exhibit 10.18(iii) to the Company's Form 10-Q
for the quarter ended June 30, 1998, filed on August 4,
1998.
12.1 Computation of Ratio of Earnings to Combined Fixed Charges
is incorporated herein by reference to Exhibit 12 to the
Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1997.
23.1* Consent of Sidley & Austin (included in Exhibit 5.1 hereto).
23.3* Consent of KPMG Peat Marwick LLP with respect to the
financial statements of the Company.
24.1*** Powers of Attorney.
25.1** Statement of Eligibility on Form T-1 under the Trust
Indenture Act of 1939, as amended, of the Indenture Trustee
to be designated.
</TABLE>
- ------------------------
* Filed herewith.
** To be filed either by amendment or as an exhibit to an Exchange Act Report
and incorporated herein by reference.
*** Previously filed.
II-2
<PAGE>
ITEM 17. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would
not exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in the
form of prospectus filed with the Securities and Exchange Commission
pursuant to Rule 424(b) under the Securities Act of 1933 if, in the
aggregate, the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective Registration
Statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) above do not
apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial BONA FIDE offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial BONA FIDE offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling
II-3
<PAGE>
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
(d) The undersigned Registrant hereby undertakes that (1) for purposes of
determining any liability under the Securities Act of 1933, the information
omitted from the form of prospectus filed as part of this Registration Statement
in reliance upon Rule 430A and contained in a form of prospectus filed by the
Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
shall be deemed to be part of this Registration Statement as of the time it was
declared effective; and (2) for the purpose of determining any liability under
the Securities Act of 1933, each post-effective amendment that contains a form
of prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial BONA FIDE offering thereof.
(e) The undersigned Registrant hereby undertakes to file, if necessary, an
application for the purpose of determining the eligibility of the Trustee to act
under subsection (a) of Section 310 of the Trust Indenture Act of 1939 in
accordance with the rules and regulations prescribed by the Securities and
Exchange Commission under Section 305(b)(2) of such Act.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of St. Louis Park, State of Minnesota, on September 22,
1998.
<TABLE>
<S> <C> <C>
METRIS COMPANIES INC.
By: /s/ Ronald N. Zebeck
------------------------------------------
Ronald N. Zebeck
President, Chief Executive Officer and
Director
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
<S> <C> <C>
By: /s/ RONALD N. ZEBECK Dated: September 22, 1998
------------------------------
Ronald N. Zebeck
President, Chief Executive
Officer and Director
(Principal Executive Officer)
By: /s/ ROBERT W. OBERRENDER Dated: September 22, 1998
------------------------------
Robert W. Oberrender
Sr. Vice President, Chief
Financial Officer (Principal
Financial Officer)
By: /s/ JEAN C. BENSON Dated: September 22, 1998
------------------------------
Jean C. Benson
Vice President, Finance,
Corporate Controller
(Principal Accounting Officer)
By: *
------------------------------
Theodore Deikel
Chairman of the Board of
Directors
By: *
------------------------------
Dudley C. Mecum
Director
By: *
------------------------------
Michael P. Sherman
Director
By: *
------------------------------
Frank D. Trestman
Director
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
By: *
------------------------------
Derek V. Smith
Director
<S> <C> <C>
By: *
------------------------------
Lee R. Anderson
Director
By: *
------------------------------
John A. Cleary
Director
</TABLE>
<TABLE>
<S> <C> <C>
*By: /s/ Z. JILL BARCLIFT Dated: September
------------------------- 22, 1998
Z. Jill Barclift or
Robert W. Oberrender
Attorney-in-fact
</TABLE>
II-6
<PAGE>
EXHIBIT INDEX
TO REGISTRATION STATEMENT
ON FORM S-3
METRIS COMPANIES INC.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- ---------- ------------------------------------------------------------------------------------------------------
<C> <S>
1.1** Form of Underwriting Agreement--Debt Securities.
1.2** Form of Underwriting Agreement--Equity Securities.
3.1 Amended and Restated Certificate of Incorporation of the Company is incorporated herein by reference
to Exhibit 3.a. to the Company's Registration Statement on Form S-1 (File No. 333-10831).
3.2 Amended and Restated By-laws of the Company are incorporated herein by reference to Exhibit 4.2 to the
Company's Registration Statement on Form S-8 (File No. 333-52627)
4.1* Form of Certificate for shares of Common Stock.
4.2 Indenture by and among the Company, the Guarantors named therein and The First National Bank of
Chicago, as Indenture Trustee, is incorporated herein by reference to Exhibit 4.1 to the Company's
Registration Statement on Form S-4 (File No. 333-43771).
4.3* Form of Indenture by and between the Company and an Indenture Trustee to be designated, pursuant to
which the Subordinated Debt is to be issued.
4.4** Form of Debt Security. The form or forms of such Debt Securities with respect to each particular
offering will be filed as an exhibit subsequently included or incorporated by reference herein.
4.5** Form of Preferred Stock. Any amendment to the Company's Amended and Restated Certificate of
Incorporation authorizing the creation of any series of Preferred Stock and setting forth the
rights, preferences and designations thereof will be filed as an exhibit subsequently included or
incorporated by reference herein.
5.1* Opinion of Sidley & Austin.
10.1 Amended and Restated Credit Agreement among the Company and the Lenders Named Therein is incorporated
herein by reference to Exhibit 10.18(iii) to the Company's Form 10-Q for the quarter ended June 30,
1998, filed on August 4, 1998.
12.1 Computation of Ratio of Earnings to Combined Fixed Charges is incorporated herein by reference to
Exhibit 12 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997.
23.1* Consent of Sidley & Austin (included in Exhibit 5.1 hereto).
23.3* Consent of KPMG Peat Marwick LLP with respect to the financial statements of the Company.
24.1*** Powers of Attorney.
25.1** Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of the
Indenture Trustee to be designated.
</TABLE>
- ------------------------
* Filed herewith.
** To be filed either by amendment or as an exhibit to an Exchange Act Report
and incorporated herein by reference.
*** Previously filed.
<PAGE>
METRIS
COMPANIES
NUMBER SHARES
MC 1096
INCORPORATED UNDER THE LAWS COMMON STOCK
OF THE STATE OF DELAWARE METRIS COMPANIES INC. CUSIP 591598 10 7
SEE REVERSE FOR CERTAIN
DEFINITIONS
THIS CERTIFIES THAT
SPECIMEN
is the owner of
FULLY PAID AND NONASSESSABLE SHARES OF THE PAR VALUE OF $.01 EACH
OF THE COMMON STOCK OF
METRIS COMPANIES INC., TRANSFERABLE ON THE BOOKS OF THE CORPORATION BY THE
HOLDER HEREOF IN PERSON OR BY AUTHORIZED ATTORNEY ON SURRENDER OF THIS
CERTIFICATE PROPERLY ENDORSED. THIS CERTIFICATE AND THE SHARES REPRESENTED
HEREBY ARE ISSUED AND SHALL BE HELD SUBJECT TO ALL THE PROVISIONS OF THE
CERTIFICATE OF INCORPORATION OF THE CORPORATION AND ALL AMENDMENTS THERETO,
COPIES OF WHICH ARE ON FILE WITH THE TRANSFER AGENT, TO ALL OF WHICH THE
HOLDER, BY ACCEPTANCE HEREOF, ASSENTS. THIS CERTIFICATE IS NOT VALID UNLESS
COUNTERSIGNED AND REGISTERED BY THE TRANSFER AGENT AND REGISTRAR.
WITNESS THE FACSIMILE SIGNATURES OF ITS DULY AUTHORIZED OFFICERS.
DATED:
/s/ MICHAEL P. SHERMAN METRIS COMPANIES INC. /s/ RONALD N. ZEBECK
MICHAEL P. SHERMAN CORPORATE SEAL 1996 RONALD N. ZEBECK
SECRETARY DELAWARE PRESIDENT AND CHIEF
[SEAL] EXECUTIVE OFFICER
COUNTERSIGNED AND REGISTERED:
NORWEST BANK MINNESOTA, N.A.
TRANSFER AGENT AND REGISTRAR
BY
AUTHORIZED SIGNATURE
<PAGE>
The Corporation shall furnish upon request and without charge, a full
statement of the designations, preferences, limitations, and relative rights
of the Common Stock and the Preferred Stock authorized to be issued, so far
as they have been determined, and a full statement of the authority of the
Board of Directors of the Corporation to determine the relative rights and
preferences of subsequently authorized and issued classes or series. Any such
request should be addressed to the Secretary of the Corporation at its
principal office or to the Transfer Agent.
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of
survivorship and not as tenants
in common
UNIF GIFT MIN ACT -- ______________ Custodian ______________
(Cust) (Minor)
under Uniform Gifts to Minors
Act ___________________________________
(State)
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED, _____________________ HEREBY SELL, ASSIGN AND TRANSFER UNTO
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- ----------------------------------------
- ----------------------------------------
- --------------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING ZIP CODE OF ASSIGNEE)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SHARES
- --------------------------------------------------------------------------
OF THE CAPITAL STOCK REPRESENTED BY THE WITHIN CERTIFICATE, AND DO HEREBY
IRREVOCABLY CONSTITUTE AND APPOINT ______________________________, ATTORNEY TO
TRANSFER THE SAID STOCK ON THE BOOKS OF THE WITHIN-NAMED CORPORATION WITH FULL
POWER OF SUBSTITUTION IN THE PREMISES.
DATED,
------------------------
-----------------------------------
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT
MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE
CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT
OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED:
-----------------------------------------
THE SIGNATURE(S) SHOULD BE GUARANTEED BY
AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN
ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE
GUARANTEE MEDALLION PROGRAM), PURSUANT
TO S.E.C. RULE 17Ad.15.
<PAGE>
EXHIBIT 4.3
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
INDENTURE
between
METRIS COMPANIES INC.
and
-----------------------,
as Trustee
Dated as of ________, 1998
Providing for the Issuance of
Subordinated Debt Securities in Series
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
PAGE
----
<TABLE>
<CAPTION>
ARTICLE I
Definitions and Other Provisions of General Application
<S> <C>
Section 1.01. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02. COMPLIANCE CERTIFICATE AND OPINIONS . . . . . . . . . . 12
Section 1.03. FORMS OF DOCUMENTS DELIVERED TO TRUSTEE . . . . . . . . 12
Section 1.04. ACTS OF HOLDERS . . . . . . . . . . . . . . . . . . . . 13
Section 1.05. NOTICES, ETC., TO TRUSTEE AND COMPANY . . . . . . . . . 15
Section 1.06. NOTICE TO HOLDERS; WAIVER . . . . . . . . . . . . . . . 16
Section 1.07. HEADINGS AND TABLE OF CONTENTS. . . . . . . . . . . . . 17
Section 1.08. SUCCESSORS AND ASSIGNS. . . . . . . . . . . . . . . . . 17
Section 1.09. SEPARABILITY. . . . . . . . . . . . . . . . . . . . . . 17
Section 1.10. BENEFITS OF INDENTURE . . . . . . . . . . . . . . . . . 17
Section 1.11. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . 17
Section 1.12. LEGAL HOLIDAYS. . . . . . . . . . . . . . . . . . . . . 18
ARTICLE II
Security Forms
Section 2.01. FORMS GENERALLY . . . . . . . . . . . . . . . . . . . . 18
Section 2.02. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION . . . . 19
Section 2.03. SECURITIES IN GLOBAL FORM . . . . . . . . . . . . . . . 19
Section 2.04. FORM OF LEGEND FOR SECURITIES IN GLOBAL FORM. . . . . . 20
ARTICLE III
The Securities
Section 3.01. AMOUNT UNLIMITED; ISSUABLE IN SERIES. . . . . . . . . . 20
Section 3.02. DENOMINATIONS . . . . . . . . . . . . . . . . . . . . . 25
Section 3.03. EXECUTION, AUTHENTICATION, DELIVERY AND DATING. . . . . 25
Section 3.04. TEMPORARY SECURITIES. . . . . . . . . . . . . . . . . . 28
Section 3.05. REGISTRATION, TRANSFER AND EXCHANGE . . . . . . . . . . 29
Section 3.06. REPLACEMENT SECURITIES. . . . . . . . . . . . . . . . . 34
Section 3.07. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED. . . . . 35
Section 3.08. PERSONS DEEMED OWNERS . . . . . . . . . . . . . . . . . 37
Section 3.09. CANCELLATION. . . . . . . . . . . . . . . . . . . . . . 38
Section 3.10. COMPUTATION OF INTEREST . . . . . . . . . . . . . . . . 38
Section 3.11. CUSIP NUMBERS . . . . . . . . . . . . . . . . . . . . . 38
Section 3.12. CURRENCY AND MANNER OF PAYMENT IN
RESPECT OF SECURITIES . . . . . . . . . . . . . . . . . 39
Section 3.13. APPOINTMENT AND RESIGNATION OF EXCHANGE RATE AGENT. . . 44
ARTICLE IV
Satisfaction, Discharge and Defeasance
Section 4.01. TERMINATION OF COMPANY'S OBLIGATIONS UNDER THE
INDENTURE . . . . . . . . . . . . . . . . . . . . . . . 44
2
<PAGE>
Section 4.02. APPLICATION OF TRUST FUNDS. . . . . . . . . . . . . . . 46
Section 4.03. APPLICABILITY OF DEFEASANCE PROVISIONS;
COMPANY'S OPTION TO EFFECT DEFEASANCE OR
COVENANT DEFEASANCE . . . . . . . . . . . . . . . . . . 46
Section 4.04. DEFEASANCE AND DISCHARGE. . . . . . . . . . . . . . . . 46
Section 4.05. COVENANT DEFEASANCE . . . . . . . . . . . . . . . . . . 47
Section 4.06. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE . . . . 48
Section 4.07. DEPOSITED MONEY AND GOVERNMENT OBLIGATIONS TO BE
HELD IN TRUST . . . . . . . . . . . . . . . . . . . . . 50
Section 4.08. REPAYMENT TO COMPANY. . . . . . . . . . . . . . . . . . 51
Section 4.09. INDEMNITY FOR GOVERNMENT OBLIGATIONS. . . . . . . . . . 51
Section 4.10. REINSTATEMENT . . . . . . . . . . . . . . . . . . . . . 51
ARTICLE V
Defaults and Remedies
Section 5.01. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . 52
Section 5.02. ACCELERATION; RESCISSION AND ANNULMENT. . . . . . . . . 54
Section 5.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY TRUSTEE. . . . . . . . . . . . . . . . . 55
Section 5.04. TRUSTEE MAY FILE PROOFS OF CLAIM. . . . . . . . . . . . 56
Section 5.05. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION
OF SECURITIES . . . . . . . . . . . . . . . . . . . . . 57
Section 5.06. DELAY OR OMISSION NOT WAIVER. . . . . . . . . . . . . . 57
Section 5.07. WAIVER OF PAST DEFAULTS . . . . . . . . . . . . . . . . 57
Section 5.08. CONTROL BY MAJORITY . . . . . . . . . . . . . . . . . . 57
Section 5.09. LIMITATION ON SUITS BY HOLDERS. . . . . . . . . . . . . 58
Section 5.10. RIGHTS OF HOLDERS TO RECEIVE PAYMENT. . . . . . . . . . 59
Section 5.11. APPLICATION OF MONEY COLLECTED. . . . . . . . . . . . . 59
Section 5.12. RESTORATION OF RIGHTS AND REMEDIES. . . . . . . . . . . 59
Section 5.13. RIGHTS AND REMEDIES CUMULATIVE. . . . . . . . . . . . . 60
Section 5.14. WAIVER OF USURY, STAY OR EXTENSION LAWS . . . . . . . . 60
Section 5.15. UNDERTAKING FOR COSTS . . . . . . . . . . . . . . . . . 60
Section 5.16. JUDGMENT CURRENCY . . . . . . . . . . . . . . . . . . . 60
ARTICLE VI
The Trustee
Section 6.01. CERTAIN DUTIES AND RESPONSIBILITIES OF THE TRUSTEE. . . 61
Section 6.02. RIGHTS OF TRUSTEE . . . . . . . . . . . . . . . . . . . 61
Section 6.03. TRUSTEE MAY HOLD SECURITIES . . . . . . . . . . . . . . 63
Section 6.04. MONEY HELD IN TRUST . . . . . . . . . . . . . . . . . . 63
Section 6.05. TRUSTEE'S DISCLAIMER. . . . . . . . . . . . . . . . . . 63
Section 6.06. NOTICE OF DEFAULTS. . . . . . . . . . . . . . . . . . . 63
Section 6.07. REPORTS BY TRUSTEE TO HOLDERS . . . . . . . . . . . . . 64
Section 6.08. SECURITYHOLDER LISTS. . . . . . . . . . . . . . . . . . 64
Section 6.09. COMPENSATION AND INDEMNITY. . . . . . . . . . . . . . . 64
Section 6.10. REPLACEMENT OF TRUSTEE. . . . . . . . . . . . . . . . . 65
Section 6.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. . . . . . . . . 67
Section 6.12. ELIGIBILITY; DISQUALIFICATION . . . . . . . . . . . . . 68
Section 6.13. MERGER, CONVERSION, CONSOLIDATION OR
SUCCESSION TO BUSINESS. . . . . . . . . . . . . . . . . 68
3
<PAGE>
Section 6.14. APPOINTMENT OF AUTHENTICATING AGENT . . . . . . . . . . 69
ARTICLE VII
Consolidation, Merger or Sale by the Company
Section 7.01. CONSOLIDATION, MERGER OR SALE OF ASSETS PERMITTED . . . 71
ARTICLE VIII
Supplemental Indentures
Section 8.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS. . . 72
Section 8.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS . . . . 73
Section 8.03. COMPLIANCE WITH TRUST INDENTURE ACT . . . . . . . . . . 75
Section 8.04. EXECUTION OF SUPPLEMENTAL INDENTURES. . . . . . . . . . 75
Section 8.05. EFFECT OF SUPPLEMENTAL INDENTURES . . . . . . . . . . . 75
Section 8.06. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES. . . 75
Section 8.07. EFFECT ON SENIOR INDEBTEDNESS . . . . . . . . . . . . . 75
ARTICLE IX
Covenants
Section 9.01. PAYMENT OF PRINCIPAL, PREMIUM, IF ANY, AND INTEREST . . 75
Section 9.02. MAINTENANCE OF OFFICE OR AGENCY . . . . . . . . . . . . 76
Section 9.03. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN
TRUST; UNCLAIMED MONEY. . . . . . . . . . . . . . . . . 77
Section 9.04. CORPORATE EXISTENCE . . . . . . . . . . . . . . . . . . 79
Section 9.05. REPORTS BY THE COMPANY. . . . . . . . . . . . . . . . . 79
Section 9.06. ANNUAL REVIEW CERTIFICATE; NOTICE OF
DEFAULTS OR EVENTS OF DEFAULT . . . . . . . . . . . . . 80
Section 9.07. BOOKS OF RECORD AND ACCOUNT . . . . . . . . . . . . . . 80
ARTICLE X
Redemption
Section 10.01. APPLICABILITY OF ARTICLE . . . . . . . . . . . . . . . 80
Section 10.02. ELECTION TO REDEEM NOTICE TO TRUSTEE . . . . . . . . . 80
Section 10.03. SELECTION OF SECURITIES TO BE REDEEMED . . . . . . . . 81
Section 10.04. NOTICE OF REDEMPTION . . . . . . . . . . . . . . . . . 81
Section 10.05. DEPOSIT OF REDEMPTION PRICE. . . . . . . . . . . . . . 83
Section 10.06. SECURITIES PAYABLE ON REDEMPTION DATE. . . . . . . . . 83
Section 10.07. SECURITIES REDEEMED IN PART. . . . . . . . . . . . . . 84
ARTICLE XI
Sinking Funds
Section 11.01. APPLICABILITY OF ARTICLE . . . . . . . . . . . . . . . 84
Section 11.02. SATISFACTION OF SINKING FUND PAYMENTS WITH
SECURITIES . . . . . . . . . . . . . . . . . . . . . . 85
Section 11.03. REDEMPTION OF SECURITIES FOR SINKING FUND. . . . . . . 85
4
<PAGE>
ARTICLE XII
Subordination of Securities
Section 12.01. AGREEMENT TO SUBORDINATE . . . . . . . . . . . . . . . 86
Section 12.02. DISTRIBUTION ON DISSOLUTION, LIQUIDATION AND
REORGANIZATION . . . . . . . . . . . . . . . . . . . . 86
Section 12.03. PRIOR PAYMENT TO SENIOR INDEBTEDNESS UPON
ACCELERATION OF SECURITIES . . . . . . . . . . . . . . 88
Section 12.04. NO PAYMENT ON SECURITIES IN EVENT OF DEFAULT
ON SENIOR INDEBTEDNESS . . . . . . . . . . . . . . . . 89
Section 12.05. PAYMENTS ON SECURITIES PERMITTED . . . . . . . . . . . 89
Section 12.06. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR
INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . 89
Section 12.07. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. . . . . . 90
Section 12.08. AUTHORIZATION OF HOLDERS OF SECURITIES TO
TRUSTEE TO EFFECT SUBORDINATION. . . . . . . . . . . . 91
Section 12.09. NOTICES TO TRUSTEE . . . . . . . . . . . . . . . . . . 91
Section 12.10. TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS . . . . . . . 92
Section 12.11. NO WAIVER OF SUBORDINATION PROVISIONS. . . . . . . . . 92
Section 12.12. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE
OF LIQUIDATING AGENT . . . . . . . . . . . . . . . . . 92
Section 12.13. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR
INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . 93
Section 12.14. ARTICLE APPLICABLE TO PAYING AGENTS. . . . . . . . . . 93
Section 12.15. CERTAIN CONVERSIONS OR EXCHANGES DEEMED PAYMENT. . . . 93
</TABLE>
5
<PAGE>
INDENTURE, dated as of ________, 1998 from METRIS COMPANIES INC., a
Delaware corporation (the "Company"), to ________________________ (the
"Trustee").
RECITALS
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
subordinated debentures, notes or other evidences of subordinated indebtedness
("Securities") to be issued in one or more series as herein provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed as
follows for the equal and ratable benefit of the Holders of the Securities:
ARTICLE I
Definitions and Other Provisions
of General Application
Section 1.01. DEFINITIONS. (a) For all purposes of this Indenture,
except as otherwise expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP (as hereinafter defined);
and
(4) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by, or under direct or indirect common
control, with such specified Person. For purposes of this definition, "control"
when used with respect to any specified Person means the power to direct
<PAGE>
the management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and the
terms "controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any Paying Agent or Registrar.
"Authenticating Agent" means any authenticating agent appointed by the
Trustee pursuant to Section 6.14.
"Authorized Newspaper" means a newspaper of general circulation, in
the official language of the country of publication or in the English language,
customarily published on each Business Day whether or not published on
Saturdays, Sundays or holidays. Whenever successive publications in an
Authorized Newspaper are required hereunder they may be made (unless otherwise
expressly provided herein) on the same or different days of the week and in the
same or different Authorized Newspapers.
"Bearer Security" means any Security issued hereunder which is payable
to bearer.
"Board" or "Board of Directors" means the Board of Directors of the
Company or any duly authorized committee of the Board of Directors of the
Company.
"Board Resolution" means a copy of a resolution of the Board of
Directors, certified by the Secretary or an Assistant Secretary of the Company
to have been duly adopted by the Board of Directors and to be in full force and
effect on the date of the certificate, and delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment or any
other particular location referred to in this Indenture or in the Securities,
means, unless otherwise specified with respect to any Securities pursuant to
Section 3.01, each Monday, Tuesday, Wednesday, Thursday and Friday which is not
a day on which banking institutions in that Place of Payment or particular
location are authorized or obligated by law or executive order to close.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, or,
if at any time after the execution of this Indenture such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Company" means the party named as the Company in the first paragraph
of this Indenture until a successor corporation
2
<PAGE>
shall have become such pursuant to the applicable provisions of this Indenture,
and thereafter means such successor.
"Company Order" and "Company Request" mean, respectively, a written
order or request signed in the name of the Company by two Officers, one of whom
must be the Chairman of the Board, the President, the Chief Financial Officer,
the Treasurer, the Assistant Treasurer, the Controller or a Vice President of
the Company.
"Conversion Event" means the cessation of use of (i) a Foreign
Currency both by the issuer of such currency and for the settlement of
transactions by a central bank or other public institutions of or within the
international banking community, (ii) the ECU both within the European Monetary
System and for the settlement of transactions by public institutions of or
within the European Communities or (iii) any currency unit other than the ECU
for the purposes for which it was established.
"Corporate Trust Office" means the office of the Trustee in which at
any particular time its corporate trust business shall be principally
administered, which office at the date hereof is located at __________________
______________________________________, Attention: Corporate Trust Dept.
"Currency Unit" or "currency unit" for all purposes of this Indenture
shall mean any composite currency.
"Debt" means indebtedness for money borrowed.
"Default" means any event which is, or after notice or passage of
time, or both, would be, an Event of Default.
"Depository" when used with respect to the Securities of or within any
series issuable or issued in whole or in part in global form, means the Person
designated as Depository by the Company pursuant to Section 3.01 until a
successor Depository shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter shall mean or include each Person
which is then a Depository hereunder, and if at any time there is more than one
such Person, shall be a collective reference to such Persons.
"Dollar" means the currency of the United States as at the time of
payment is legal tender for the payment of public and private debts.
"ECU" means the European Currency Unit as defined and revised from
time to time by the Council of the European Communities.
3
<PAGE>
"European Communities" means the European Economic Community, the
European Coal and Steel Community and the European Atomic Energy Community.
"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of the European
Communities.
"Exchange Rate Agent", when used with respect to Securities of or
within any series, means, unless otherwise specified with respect to any
Securities pursuant to Section 3.01, a bank designated pursuant to Section 3.01
or Section 3.13 (which may include any such bank acting as Trustee hereunder).
"Exchange Rate Officer's Certificate" means a certificate setting
forth (i) the applicable Market Exchange Rate or the applicable bid quotation
and (ii) the Dollar or Foreign Currency amounts of principal (and premium, if
any) and interest, if any (on an aggregate basis and on the basis of a Security
having the lowest denomination principal amount in the relevant currency or
currency unit), payable with respect to a Security of any series on the basis of
such Market Exchange Rate or the applicable bid quotation, signed by the Chief
Financial Officer, the Treasurer, the Controller, any Vice President or the
Assistant Treasurer of the Company.
"Foreign Currency" means any currency issued by the government of one
or more countries other than the United States or by any recognized
confederation or association of such governments.
"GAAP" means United States generally accepted accounting principles,
in effect as of the date of this Indenture, as set forth in the statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as is approved by a significant segment of the
accounting profession.
"Government Obligations" means securities which are (i) direct
obligations of the United States or, if specified as contemplated by Section
3.01, the government which issued the currency in which the Securities of a
particular series are payable, for the payment of which its full faith and
credit is pledged or (ii) obligations of a Person controlled or supervised by
and acting as an agency or instrumentality of the United States or, if specified
as contemplated by Section 3.01, such government which issued the foreign
currency in which the Securities of such series are payable, the payment of
which is unconditionally guaranteed as a full faith and credit obligation by the
United States or such other government, which, in either case, are not callable
or redeemable at the option of the issuer thereof, and shall also include a
depository receipt issued by a
4
<PAGE>
bank or trust company as custodian with respect to any such Government
Obligation or a specific payment of interest on or principal of any such
Government Obligation held by such custodian for the account of the holder of a
depository receipt; PROVIDED that (except as required by law) such custodian is
not authorized to make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custodian in respect of
the Government Obligation evidenced by such depository receipt.
"Holder" means, with respect to a Bearer Security, a bearer thereof or
of a coupon appertaining thereto and, with respect to a Registered Security, a
person in whose name a Security is registered on the Register.
"Indenture" means this Indenture as originally executed or as amended
or supplemented from time to time and shall include the forms and terms of
particular series of Securities established as contemplated hereunder.
"Indexed Security" means a Security the terms of which provide that
the principal amount thereof payable at Stated Maturity may be more or less than
the principal face amount thereof at original issuance.
"Interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity.
"Interest Payment Date", when used with respect to any Security, means
the Stated Maturity of an installment of interest on such Security.
"Market Exchange Rate" means, unless otherwise specified with respect
to any Securities pursuant to Section 3.01, (i) for any conversion involving a
currency unit on the one hand and Dollars or any Foreign Currency on the other,
the exchange rate between the relevant currency unit and Dollars or such Foreign
Currency calculated by the method specified pursuant to Section 3.01 for the
Securities of the relevant series, (ii) for any conversion of Dollars into any
Foreign Currency, the noon buying rate for such Foreign Currency for cable
transfers quoted in New York City as certified for customs purposes by the
Federal Reserve Bank of New York and (iii) for any conversion of one Foreign
Currency into Dollars or another Foreign Currency, the spot rate at noon local
time in the relevant market at which, in accordance with normal banking
procedures, the Dollars or Foreign Currency into which conversion is being made
could be purchased with the Foreign Currency from which conversion is being made
from major banks located in New York City, London or any other principal market
for Dollars or such purchased Foreign Currency, in each case determined by the
Exchange Rate Agent. Unless
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otherwise specified with respect to any Securities pursuant to Section 3.01, in
the event of the unavailability of any of the exchange rates provided for in the
foregoing clauses (i), (ii) and (iii), the Exchange Rate Agent shall use, in its
sole discretion and without liability on its part, such quotation of the Federal
Reserve Bank of New York as of the most recent available date, or quotations
from one or more major banks in New York City, London or other principal market
for such currency or currency unit in question (which may include any such bank
acting as Trustee under this Indenture), or such other quotations as the
Exchange Rate Agent shall deem appropriate. If there is more than one market
for dealing in any currency or currency unit by reason of foreign exchange
regulations or otherwise, the market to be used in respect of such currency or
currency unit shall be that upon which a nonresident issuer of securities
designated in such currency or currency unit would purchase such currency or
currency unit in order to make payments in respect of such securities.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an installment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Officer" means the Chairman of the Board, the President, any Vice
President, the Chief Financial Officer, the Treasurer, the Assistant Treasurer,
the Controller, the Secretary or any Assistant Secretary of the Company.
"Officers' Certificate", when used with respect to the Company, means
a certificate signed by two Officers, one of whom must be the Chairman of the
Board, the President, the Chief Financial Officer, the Treasurer, the Assistant
Treasurer, the Controller or a Vice President of the Company.
"Opinion of Counsel" means a written opinion from the general counsel
of the Company or other legal counsel who is reasonably acceptable to the
Trustee. Such counsel may be an employee of or counsel to the Company.
"Original Issue Discount Security" means any Security which provides
for an amount less than the stated principal amount thereof to be due and
payable upon declaration of acceleration of the Maturity thereof pursuant to
Section 5.02.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
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(i) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Securities, or portions thereof, for whose payment or redemption
money in the necessary amount and in the required currency or Currency Unit
has been theretofore deposited with the Trustee or any Paying Agent (other
than the Company) in trust or set aside and segregated in trust (if the
Company shall act as its own Paying Agent) for the Holders of such
Securities and any coupons appertaining thereto, provided that, if such
Securities are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture or provisions therefor satisfactory to the
Trustee have been made;
(iii) Securities, except to the extent provided in Sections 4.04, with
respect to which the Company has effected defeasance as provided in Article
IV; and
(iv) Securities which have been paid pursuant to Section 3.06 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, or whether
sufficient funds are available for redemption or for any other purpose and for
the purpose of making the calculations required by Section 313 of the Trust
Indenture Act, (W) the principal amount of any Original Issue Discount
Securities that may be counted in making such determination or calculation and
that shall be deemed to be outstanding for such purpose shall be equal to the
amount of principal thereof that would be (or shall have been declared to be)
due and payable, at the time of such Determination, upon a declaration of
acceleration of the maturity thereof pursuant to Section 5.02, (X) the principal
amount of any Security denominated in a Foreign Currency that may be counted in
making such determination or calculation and that shall be deemed Outstanding
for such purpose shall be equal to the Dollar equivalent, determined as of the
date such Security is originally issued by the Company as set forth in an
Exchange Rate Officer's Certificate delivered to the Trustee, of the principal
amount (or, in the case of an Original Issue Discount Security, the Dollar
equivalent as of such date of original issuance of the amount determined as
provided in clause (W) above) of such Security, (Y) the principal amount of any
Indexed Security that
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may be counted in making such determination or calculation and that shall be
deemed Outstanding for such purpose shall be equal to the principal face amount
of such Indexed Security at original issuance, unless otherwise provided with
respect to such security pursuant to Section 3.01, and (Z) Securities owned by
the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in making such calculation or in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which the
Trustee actually knows to be so owned shall be so disregarded. Securities so
owned which have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Trustee the pledgee's right
so to act with respect to such Securities and that the pledgee is not the
Company or any other obligor upon the Securities or any Affiliate of the Company
or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of, premium, if any, or interest and any other payments on any
Securities on behalf of the Company.
"Periodic Offering" means an offering of Securities of a series from
time to time the specific terms of which Securities, including, without
limitation, the rate or rates of interest or formula for determining the rate or
rates of interest thereon, if any, the Maturity thereof and the redemption
provisions, if any, with respect thereto, are to the determined by the Company
upon the issuance of such Securities.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Place of Payment", when used with respect to the Securities of or
within any series, means the place or places where the principal of, premium, if
any, and interest and any other payments on such Securities are payable as
specified as contemplated by Sections 3.01.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security and, for the purposes of this definition, any Security
authenticated and delivered under Section 3.06 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
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"Principal Amount", when used with respect to any Security, means the
amount of principal, if any, payable in respect thereof at Maturity; PROVIDED,
HOWEVER, that when used with respect to an Indexed Security in any context other
than the making of payments at Maturity, "principal amount" means the principal
face amount of such Indexed Security at original issuance.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, in whole or in part, means the price at which it is to be redeemed
pursuant to this Indenture.
"Registered Security" means any Security issued hereunder and
registered as to principal and interest in the Register.
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of or within any series means the date specified for that
purpose as contemplated by Section 3.01.
"Responsible Officer", when used with respect to the Trustee, shall
mean the chairman or any vice chairman of the board of directors, the chairman
or any vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any senior vice president, any
vice president, any assistant vice president, the secretary, the treasurer, any
assistant treasurer, the cashier, any assistant cashier, any senior trust
officer, any trust officer, the controller, any assistant controller, or any
officer of the Trustee customarily performing functions similar to those
performed by the persons who at the time shall be such officers, respectively,
or to whom any corporate trust matter is referred because of his knowledge of
and familiarity with a particular subject.
"Security" or "Securities" has the meaning stated in the first recital
of this Indenture and more particularly means a Security or Securities of the
Company issued, authenticated and delivered under this Indenture.
"Senior Indebtedness" means the principal of, premium, if any, and
unpaid interest on (i) all indebtedness of the Company, whether outstanding on
the date of this Indenture or thereafter created, incurred or assumed, which is
for money borrowed, or which is evidenced by a note or similar instrument given
in connection with the acquisition of any business, properties or assets,
including securities; (ii) any indebtedness
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of others of the kinds described in the preceding clause (i) the payment of
which the Company is responsible for or liable as guarantor or otherwise; and
(iii) amendments, renewals, extensions or refundings of any such indebtedness,
unless in any instrument or instruments evidencing or securing such indebtedness
or pursuant to which the same is outstanding, it is provided that such
indebtedness is not senior in right of payment to, or that such indebtedness is
PARI PASSU in right of payment with or junior to, the Securities.
Senior Indebtedness does not include (a) any indebtedness of the
Company to any of its Subsidiaries, (b) liabilities of the Company incurred in
the ordinary course of its business, or (c) any indebtedness which by its terms
is expressly made PARI PASSU in right of payment with or subordinated to any
other Securities.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 3.07.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
on such Security or on a coupon representing such installment of interest as the
fixed date on which the principal of such Security or such installment of
principal or interest is due and payable.
"Subsidiary" means, with respect to any Person, (i) a corporation more
than 50% of the combined voting power of the outstanding Voting Stock of which
is owned, directly or indirectly, by such Person or by one or more other
Subsidiaries of such Person or by such Person and one or more Subsidiaries
thereof, (ii) any other Person (other than a corporation) in which such Person,
or one or more other Subsidiaries of such Person or such Person and one or more
other Subsidiaries thereof, directly or indirectly, has at least a majority
ownership and power to direct the policies, management and affairs thereof, or
(iii) any other Person which is otherwise controlled by such Person or by one or
more other Subsidiaries of such Person or by such Person and one or more other
Subsidiaries of such Person.
"Total Assets" means, at any date, the total assets appearing on the
most recently prepared consolidated balance sheet of the Company and its
consolidated Subsidiaries as of the end of a fiscal quarter of the Company,
prepared in accordance with GAAP.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
effect on the date of this Indenture, except as provided in Section 8.03.
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"Trustee" means the party named as such in the first paragraph of this
Indenture until a successor Trustee replaces it pursuant to the applicable
provisions of this Indenture, and thereafter means such successor Trustee and
if, at any time, there is more than one Trustee, "Trustee" as used with respect
to the Securities of any series shall mean the Trustee with respect to the
Securities of that series.
"United States" means, unless otherwise specified with respect to the
Securities of any series as contemplated by Section 3.01, the United States of
America (including the States and the District of Columbia), its territories,
its possessions and other areas subject to its jurisdiction.
"U.S. Person" means, unless otherwise specified with respect to the
Securities of any series as contemplated by Section 3.01, a citizen, national or
resident of the United States, a corporation, partnership or other entity
created or organized in or under the laws of the United States or any political
subdivision thereof, or an estate or trust, the income of which is subject to
United States federal income taxation regardless of its source.
"Voting Stock" of any Person means capital stock of such Person which
ordinarily has voting power for the election of directors (or persons performing
similar functions) of such Person, whether at all times or only so long as no
senior class of securities has such voting power by reason of any contingency.
(b) The following terms shall have the meanings specified in the
Sections referred to opposite such term below:
TERM Section
"Act" 1.04(a)
"Additional Amount" 3.01(17)
"Bankruptcy Law" 5.01
"Component Currency" 3.12(h)
"Conversion Date" 3.12(d)
"Custodian" 5.01
"Defaulted Interest" 3.07(b)
"Election Date" 3.12(h)
"Event of Default" 5.01
"Judgment Date" 5.16
"Notice of Default" 5.01(3)
"Register" 3.05
"Registrar" 3.05
"Substitute Date" 5.16
"Valuation Date" 3.12(c)
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Section 1.02. COMPLIANCE CERTIFICATE AND OPINIONS. Upon any
application or request by the Company to the Trustee to take an action under any
provision of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent, if any, provided
for in this Indenture relating to the proposed action have been complied with
and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, except that in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than pursuant to
Sections 2.03 and 9.06) shall include:
(a) a statement that each individual signing such certificate or
opinion has read such condition or covenant and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such condition or covenant
has been complied with; and
(d) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.03. FORMS OF DOCUMENTS DELIVERED TO TRUSTEE. In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an Officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such Officer knows, or in the exercise of
reasonable care should
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know, that the certificate or opinion or representations with respect to the
matters upon which his certificate or opinion is based are erroneous. Any such
certificate or Opinion of Counsel may be based, insofar as it relates to factual
matters, upon a certificate or opinion of, or representations by, an Officer or
Officers of the Company stating that the information with respect to such
factual matters is in the possession of the Company, unless such counsel knows,
or in the exercise of reasonable care should know, that the certificate or
opinion or representations as to such matters are erroneous.
Any certificate, statement or opinion of an Officer of the Company or
of counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Company, unless such Officer or counsel, as the
case may be, knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the accounting matters
upon which his certificate, statement or opinion is based are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.04. ACTS OF HOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such Holders
in person or by agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, where it is hereby expressly
required, to the Company. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders signing such instrument or instruments. Proof of execution
of any such instrument or of a writing appointing any such Agent shall be
sufficient for any purpose of this Indenture and conclusive in favor of the
Trustee and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date
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of the execution of any such instrument or writing, or the authority of the
Person executing the same, may also be proved in any other manner which the
Trustee deems sufficient.
(c) The ownership of Bearer Securities may be proved by the
production of such Bearer Securities or by a certificate executed by any trust
company, bank, banker or other depository, wherever situated if such certificate
shall be deemed by the Trustee to be satisfactory, showing that at the date
therein mentioned such Person had on deposit with such depository, or exhibited
to it, the Bearer Securities therein described; or such facts may be proved by
the certificate or affidavit of the Person holding such Bearer Securities, if
such certificate or affidavit is deemed by the Trustee to be satisfactory. The
Trustee and the Company may assume that such ownership of any Bearer Security
continues until (i) another such certificate or affidavit bearing a later date
issued in respect of the same Bearer Security is produced, (ii) such Bearer
Security is produced to the Trustee by some other Person, (iii) such Bearer
Security is surrendered in exchange for a Registered Security or (iv) such
Bearer Security is no longer Outstanding. The ownership of Bearer Securities
may also be proved in any other manner which the Trustee deems sufficient; and
the Trustee may in any instance require further proof with respect to any of the
matters referred to in this Section.
(d) The ownership of Registered Securities shall be proved by the
Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made upon
such Security.
(f) If the Company shall solicit from the Holders of any series any
request, demand, authorization, direction, notice, consent, waiver or other
Act, the Company may, at its option, by or pursuant to a Board Resolution,
fix in advance a record date for the determination of Holders of such series
entitled to give such request, demand, authorization, direction, notice,
consent, waiver or other Act, but the Company shall have no obligation to do
so, provided that the Company may not set a record date for, and the
provisions of this paragraph shall not apply with respect to, the giving or
making of any notice, declaration, request or direction referred to in the
next paragraph. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent, waiver or other Act may be given
before or after such record date, but only the Holders of record at the close
of
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business on such record date shall be deemed to be Holders for the purposes of
determining whether Holders of the requisite proportion of Outstanding
Securities have authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other Act, and for that
purpose the Outstanding Securities shall be computed as of such record date;
provided that no such authorization, agreement or consent by the Holders on such
record date shall be deemed effective unless it shall become effective pursuant
to the provisions of this Indenture not later than six months after the record
date.
(g) The Trustee may set any day as a record date for the purpose of
determining the Holders of any series entitled to join in the giving or making
of (i) any Notice of Default, (ii) any declaration of acceleration referred to
in Section 5.02, (iii) any direction referred to in Section 5.08 or (iv) any
request to institute proceedings referred to in Section 5.09(2), and (v) any
waiver of past defaults pursuant to Section 5.07, in each case with respect to
Securities of such series. If such a record date is fixed pursuant to this
paragraph, the relevant action may be taken or given before or after such record
date, but only the Holders of record at the close of business on such record
date shall be deemed to be holders of a series for the purpose of determining
whether Holders of the requisite proportion of Outstanding Securities of such
series have authorized or agreed or consented to such action, and for that
purpose the Outstanding Securities of such series shall be computed as of such
record date; PROVIDED that no such action by Holders on such record date shall
be deemed effective unless it shall become effective pursuant to the provisions
of this Indenture not later than six months after the record date. Nothing in
this paragraph shall be construed to prevent the Trustee from setting a new
record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be canceled and of no effect),
and nothing in this paragraph shall be construed to render ineffective any
action taken by Holders of the requisite principal amount of Outstanding
Securities of the relevant series on the date such action is taken. Promptly
after any record date is set pursuant to this paragraph, the Trustee, at the
Company's expense, shall cause notice of such record date and the proposed
action by Holders to be given to the Company in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 1.06.
Section 1.05. NOTICES, ETC., TO TRUSTEE AND COMPANY. Any request,
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with,
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(a) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) in
writing and mailed, first-class postage prepaid, to the Trustee at its
Corporate Trust Office at____________________________________________,
Attention: Corporate Trust Department, or
(b) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) in
writing and mailed, first-class postage prepaid, to the Company addressed
to it at Metris Companies Inc., 600 South Highway 169, Suite 1800, St.
Louis Park, Minnesota 55426, Attention: General Counsel or at any other
address previously furnished in writing to the Trustee by the Company.
Section 1.06. NOTICE TO HOLDERS; WAIVER. Where this Indenture
provides for notice to Holders of an event (i) if any of the Securities affected
by such event are Registered Securities, such notice to the Holders thereof
shall be sufficiently given unless otherwise herein expressly provided) if in
writing and mailed first-class postage prepaid to each such Holder affected by
such event, at his address as it appears in the Register within the time
prescribed for the giving of such notice and, (ii) if any of the Securities
affected by such event are Bearer Securities, notice to the Holders thereof
shall be sufficiently given (unless otherwise herein or in the terms of such
Bearer Securities expressly provided) if published once in an Authorized
Newspaper in New York, New York, and in such other city or cities, if any, as
may be specified as contemplated by Section 3.01.
In any case where notice to Holders of Registered Securities is given
by mail, neither the failure to mail such notice, nor any defect in any notice
so mailed, to any particular Holder of a Registered Security shall affect the
sufficiency of such notice with respect to other Holders of Registered
Securities or the sufficiency of any notice to Holders of Bearer Securities
given as provided herein. In any case where notice is given to Holders of
Bearer Securities by publication, neither the failure to publish such notice,
nor any defect in any notice so published, shall affect the sufficiency of such
notice with respect to other Holders of Bearer Securities or the sufficiency of
any notice with respect to any Holders of Registered Securities given as
provided herein. Any notice mailed to a Holder in the manner herein prescribed
shall be conclusively deemed to have been received by such Holder, whether or
not such Holder actually receives such notice.
If by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice as provided above,
then such notification as shall be
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made with the approval of the Trustee shall constitute a sufficient notification
for every purpose hereunder with respect to a Holder of Registered Securities.
If it is impossible or, in the opinion of the Trustee, impracticable to give any
notice by publication in the manner herein required, then such publication in
lieu thereof as shall be made with the approval of the Trustee shall constitute
a sufficient publication of such notice with respect to a Holder of Bearer
Securities.
Any request, demand, authorization, direction, notice, consent or
waiver required or permitted under this Indenture shall be in the English
language, except that any published notice may be in an official language of the
country of publication.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event and such waiver shall be equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
Section 1.07. HEADINGS AND TABLE OF CONTENTS. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
Section 1.08. SUCCESSORS AND ASSIGNS. All covenants and agreements
in this Indenture by the Company shall bind its successors and assigns, whether
so expressed or not.
Section 1.09. SEPARABILITY. In case any provision of this Indenture
or the Securities shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
Section 1.10. BENEFITS OF INDENTURE. Nothing in this Indenture or in
the Securities, expressed or implied, shall give to any Person, other than the
parties hereto and their successors hereunder and the Holders, any benefit or
any legal or equitable right, remedy or claim under this Indenture.
Section 1.11. GOVERNING LAW. This Indenture, the Securities and any
coupons appertaining thereto shall be governed by and construed in accordance
with the laws of the State of New York without regard to principles of conflicts
of laws. This Indenture is subject to the Trust Indenture Act and if any
provision hereof limits, qualifies or conflicts with any provision of the Trust
Indenture Act, which is required under such Act to be a part of and govern this
Indenture, the latter
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provision shall control. If any provision of this Indenture modifies or
excludes any provision of the Trust Indenture Act which may be so modified or
excluded the latter provision shall be deemed to apply to this Indenture as
so modified or to be excluded, as the case may be. Whether or not this
Indenture is required to be qualified under the Trust Indenture Act, the
provisions of the Trust Indenture Act required to be included in an indenture
in order for such indenture to be so qualified shall be deemed to be included
in this Indenture with the same effect as if such provisions were set forth
herein and any provisions hereof which may not be included in an indenture
which is so qualified shall be deemed to be deleted or modified to the extent
such provisions would be required to be deleted or modified in an indenture
so qualified.
Section 1.12. LEGAL HOLIDAYS. In any case where any Interest Payment
Date, Redemption Date, sinking fund payment date, Stated Maturity or Maturity of
any Security shall not be a Business Day at any Place of Payment, then
(notwithstanding any other provision of this Indenture or of any Security or
coupon other than a provision in the Securities of an series which specifically
states that such provision shall apply in lieu of this Section) payment of
principal, premium, if any, or interest need not be made at such Place of
Payment on such date, but may be made on the next succeeding Business Day at
such Place of Payment with the same force and effect as if made on such date;
provided that to the extent such payment is made on such next succeeding
Business Day, no interest shall accrue on the amount so payable for the period
from and after such Interest Payment Date, Redemption Date, sinking fund payment
date, Stated Maturity or Maturity, as the case may be.
ARTICLE II
Security Forms
Section 2.01. FORMS GENERALLY. The Securities of each series and the
coupons, if any, to be attached thereto shall be in substantially such form as
shall be established by or pursuant to a Board Resolution or in one or more
indentures supplemental hereto, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
this Indenture and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or Depository
therefor or as may, consistently herewith, be determined by the officers
executing such Securities and coupons, if any, as evidenced by their execution
of the Securities and coupons, if any. If temporary Securities of any series
are issued as permitted by Section 3.04, the form thereof also shall be
established as provided in the
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preceding sentence. If the forms of Securities and coupons, if any, of any
series are established by, or by action taken pursuant to, a Board Resolution, a
copy of the Board Resolution together with an appropriate record of any such
action taken pursuant thereto, including a copy of the approved form of
Securities or coupons, if any, shall be certified by the Secretary or an
Assistant Secretary of the Company and delivered to the Trustee at or prior to
the delivery of the Company Order contemplated by Section 3.03 for the
authentication and delivery of such Securities.
Unless otherwise specified as contemplated by Section 3.01, Bearer
Securities shall have interest coupons attached.
The definitive Securities and coupons, if any, shall be printed,
lithographed or engraved on steel engraved boarders or may be produced in any
other manner, all as determined by the officers executing such Securities and
coupons, if any, as evidenced by their execution of such Securities and coupons,
if any.
Section 2.02. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION. The
Trustee's certificate of authentication shall be in substantially the following
form:
This is one of the Securities of the series described in the
within-mentioned Indenture.
----------------------------,
as Trustee
By:
-------------------------------
Authorized Signatory
Section 2.03. SECURITIES IN GLOBAL FORM. If Securities of or within
a series are issuable in whole or in part in global form, any such Security of
such series may provide that it shall represent the aggregate or specified
amount of Outstanding Securities of such series from time to time endorsed
thereon and may also provide that the aggregate amount of Outstanding Securities
of such series represented thereby may from time to time be reduced or increased
to reflect exchanges. Any endorsement of a Security in global form to reflect
the amount, or any increase or decrease in the amount, or changes in the rights
of Holders, of Outstanding Securities represented thereby, shall be made in such
manner and by such Person or Persons as shall be specified therein or in the
Company Order to be delivered to the Trustee pursuant to Section 3.03 or 3.04.
Subject to the provisions of Section 3.03 and, if applicable, Section 3.04, the
Trustee shall deliver and redeliver any
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Security in permanent global form in the manner and upon instructions given by
the Person or Persons specified therein or in the applicable Company Order. Any
instructions by the Company with respect to endorsement or delivery or
redelivery of a Security in global form shall be in writing but need not comply
with Section 1.02 hereof and need not be accompanied by an Opinion of Counsel.
The provisions of the last paragraph of Section 3.03 shall apply to
any Security in global form if such Security was never issued and sold by the
Company and the Company delivers to the Trustee the Security in global form
together with written instructions (which need not comply with Section 1.02 and
need not be accompanied by an Opinion of Counsel) with regard to the reduction
in the principal amount of Securities represented thereby, together with the
written statement contemplated by the last paragraph of Section 3.03.
Notwithstanding the provisions of Section 2.01 and 3.07, unless
otherwise specified as contemplated by Section 3.01, payment of principal of,
premium, if any, and interest on any Security in permanent global form shall be
made to the Person or Persons specified therein.
Section 2.04. FORM OF LEGEND FOR SECURITIES IN GLOBAL FORM. Any
Registered Security in global form authenticated and delivered hereunder shall
bear a legend in substantially the following form with such changes as may be
required by the Depository:
THIS SECURITY IS IN GLOBAL FORM WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY. UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES
IN CERTIFICATED FORM IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE INDENTURE, THIS SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE
DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE
DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR
A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.
ARTICLE III
The Securities
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Section 3.01. AMOUNT UNLIMITED; ISSUABLE IN SERIES. (a) The
aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited. The Securities may be issued from
time to time in one or more series.
(b) The following matters shall be established with respect to each
series of Securities issued hereunder (i) by a Board Resolution, (ii) by action
taken pursuant to a Board Resolution and (subject to Section 3.03) set forth, or
determined in the manner provided, in an Officers' Certificate or (iii) in one
or more indentures supplemental hereto:
(1) the title of the Securities of the series (which title shall
distinguish the Securities of the series from all other series of
Securities);
(2) any limit upon the aggregate principal amount of the Securities
of the series which may be authenticated and delivered under this Indenture
(which limit shall not pertain to Securities authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of, other
securities of the series pursuant to Section 3.04, 3.05, 3.06, 8.06, or
10.07);
(3) the date or dates on which the principal of and premium, if any,
on the Securities of the series is payable or the method of determination
thereof;
(4) the rate or rates at which the Securities of the series shall
bear interest, if any, or the method of calculating such rate or rates of
interest, the date or dates from which such interest shall accrue or the
method by which such date or dates shall be determined, the Interest
Payment Dates on which any such interest shall be payable and, with respect
to Registered Securities, the Regular Record Date, if any, for the interest
payable on any Registered Security on any Interest Payment Date;
(5) the place or places where the principal of, premium, if any, and
interest, if any, on Securities of the series shall be payable;
(6) the period or periods within which, the price or prices at which,
the currency or currencies (including currency unit or units) in which, and
the other terms and conditions upon which, Securities of the series may be
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redeemed, in whole or in part, at the option of the Company and, if other
than as provided in Section 10.03, the manner in which the particular
Securities of such series (if less than all Securities of such series are
to be redeemed) are to be selected for redemption;
(7) the obligation, if any, of the Company to redeem or purchase
Securities of the series pursuant to any sinking fund or analogous
provisions or upon the happening of a specified event or at the option of a
Holder thereof and the period or periods within which, the price or prices
at which, and the other terms and conditions upon which, Securities of the
series shall be redeemed or purchased, in whole or in part, pursuant to
such obligation;
(8) if other than denominations of $1,000 and any integral multiple
thereof, if Registered Securities, and if other than the denomination of
$5,000 and any integral multiple thereof, if Bearer Securities, the
denominations in which Securities of the series shall be issuable;
(9) if other than Dollars, the currency or currencies (including
currency unit or units) in which the principal of, premium, if any, and
interest, if any, on the Securities of the series shall be payable, or in
which the Securities of the series shall be denominated, and the particular
provisions applicable thereto in accordance with, in addition to, or in
lieu of the provisions of Section 3.12;
(10) if the payments of principal of, premium, if any, or interest, if
any, on the Securities of the series are to be made, at the election of the
Company or a Holder, in a currency or currencies (including currency unit
or units) other than that in which such Securities are denominated or
designated to be payable, the currency or currencies (including currency
unit or units) in which such payments are to be made, the terms and
conditions of such payments and the manner in which the exchange rate with
respect to such payments shall be determined, and the particular provisions
applicable thereto in accordance with, in addition to, or in lieu of the
provisions of Section 3.12;
(11) if the amount of payments of principal of, premium, if any, and
interest, if any, on the Securities of the series shall be determined with
reference to an index, formula or other method (which index, formula or
method may be based, without limitation, on a currency or currencies
(including currency unit or units) other than that in which the Securities
of the series are denominated or designated to be payable), the index,
formula or other method by which such amounts shall be determined;
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(12) if other than the principal amount thereof, the portion of the
principal amount of such Securities of the series which shall be payable
upon declaration of acceleration thereof pursuant to Section 5.02 or the
method by which such portion shall be determined;
(13) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more
dates prior to the Stated Maturity, the amount which shall be deemed to be
the principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall
be due and payable upon any Maturity other than the Stated Maturity or
which shall be deemed to be Outstanding as of any date prior to the Stated
Maturity (or, in any such case, the manner in which such amount deemed to
be the principal amount shall be determined);
(14) if other than as provided in Section 3.07, the Person to whom any
interest on any Registered Security of the series shall be payable and the
manner in which, or the Person to whom, any interest on any Bearer
Securities of the series shall be payable;
(15) provisions, if any, granting special rights to the Holders of
Securities of the series upon the occurrence of such events as may be
specified;
(16) any deletions from, modifications of or additions to the Events
of Default set forth in Section 5.01 or covenants of the Company set forth
in Article IX pertaining to the Securities of the series;
(17) under what circumstances, if any, the Company will pay additional
amounts on the Securities of that series held by a Person who is not a U.S.
Person in respect of taxes or similar charges withheld or deducted
("Additional Amounts") and, if so, whether the Company will have the option
to redeem such Securities rather than pay such additional amounts (and the
terms of any such option);
(18) whether Securities of the series shall be issuable as Registered
Securities or Bearer Securities (with or without interest coupons), or
both, and any restrictions applicable to the offering, sale or delivery of
Bearer Securities and, if other than as provided in Section 3.05, the terms
upon which Bearer Securities of a series may be exchanged for Registered
Securities of the same series and vice versa;
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(19) the date as of which any Bearer Securities of the series and any
temporary global Security representing Outstanding Securities of the series
shall be dated if other than the date of original issuance of the first
Security of the series to be issued;
(20) the forms of the Securities and coupons, if any, of the series;
(21) the applicability, if any, to the Securities of or within the
series of Sections 4.04 and 4.05, or such other means of defeasance or
covenant defeasance as may be specified for the Securities and coupons, if
any, of such series, and, if the Securities are payable in a currency other
than Dollars, whether, for the purpose of such defeasance or covenant
defeasance the term "Government Obligations" shall include obligations
referred to in the definition of such term which are not obligations of the
United States or an agency or instrumentality of the United States;
(22) if other than the Trustee, the identity of the Registrar and any
Paying Agent;
(23) the designation of the initial Exchange Rate Agent, if any;
(24) if the Securities of the series shall be issued in whole or in
part in global form (i) the Depository for such global Securities, (ii) the
form of any legend in addition to or in lieu of that in Section 2.04 which
shall be borne by such global Security, (iii) whether beneficial owners of
interests in any Securities of the series in global form may exchange such
interests for certificated Securities of such series and of like tenor of
any authorized form and nomination, and (iv) if other than as provided in
Section 3.05, the circumstances under which any such exchange may occur;
(25) any addition to, deletion from or change in Article XII with
respect to Securities of the Series; and
(26) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture) including any terms
which may be required by or advisable under United States laws or
regulations or advisable (as determined by the Company) in connection with
the marketing of Securities of the series.
(c) All Securities of any one series and coupons, if any,
appertaining to any Bearer Securities of such series shall be substantially
identical except, in the case of Registered
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Securities, as to denomination and except as may otherwise be provided (i) by a
Board Resolution, (ii) by action taken pursuant to a Board Resolution and
(subject to Section 3.03) set forth or determined in the manner provided, in the
related Officers' Certificate or (iii) in an indenture supplemental hereto. All
Securities of any one series need not be issued at the same time and, unless
otherwise provided, a series may be reopened, without the consent of the
Holders, for issuances of additional Securities of such series.
(d) If any of the terms of the Securities of any series are
established by action taken pursuant to a Board Resolution, a copy of such Board
Resolution shall be certified by the Corporate Secretary or an Assistant
Secretary of the Company and delivered to the Trustee at or prior to the
delivery of the Officers' Certificate setting forth, or providing the manner for
determining, the terms of the Securities of such series, and an appropriate
record of any action taken pursuant thereto in connection with the issuance of
any Securities of such series shall be delivered to the Trustee prior to the
authentication and delivery thereof.
(e) The Securities shall be subordinated and subject in right of
payment to Senior Indebtedness as provided in Article XII.
Section 3.02. DENOMINATIONS. Unless otherwise provided as
contemplated by Section 3.01, any Registered Securities of a series shall be
issuable in denominations of $1,000 and any integral multiple thereof and any
Bearer Securities of a series shall be issuable in the denomination of $5,000
and any integral multiples thereof.
Section 3.03. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
Securities shall be executed on behalf of the Company by two Officers. The
Company's seal shall be reproduced on the Securities. The signatures of any of
these officers on the Securities may be manual or facsimile. The coupons, if
any, of Bearer Securities shall bear the facsimile signature of two Officers.
Securities and coupons bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time, the Company may deliver Securities,
together with any coupons appertaining thereto, of any series executed by the
Company to the Trustee for
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<PAGE>
authentication, together with a Company Order for the authentication and
delivery of such Securities, and the Trustee in accordance with the Company
Order shall authenticate and deliver such Securities; PROVIDED, HOWEVER, that in
the case of Securities offered in a Periodic Offering, the Trustee shall
authenticate and deliver such Securities from time to time in accordance with
such other procedures (including without limitation, the receipt by the Trustee
of oral or electronic instructions from the Company or its duly authorized
agents, promptly confirmed in writing) acceptable to the Trustee as may be
specified by or pursuant to a Company Order delivered to the Trustee prior to
the time of the first authentication of Securities of such series.
If the form or terms of the Securities of a series have been
established by or pursuant to one or more Board Resolutions as permitted by
Sections 2.01 and 3.0l, in authenticating such Securities and accepting the
additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, and (subject to Section 315(a) through
(d) of the Trust Indenture Act) shall be fully protected in relying upon, an
Opinion of Counsel stating,
(1) if the forms of such Securities and any coupons have been
established by or pursuant to a Board Resolution as permitted by Section
2.01, that such forms have been established in conformity with the
provisions of this Indenture;
(2) if the terms of such Securities and any coupons have been
established by or pursuant to a Board Resolution as permitted by Section
3.01, that such terms have been, or in the case of Securities of a series
offered in a Periodic Offering, will be, established in conformity with the
provisions of this Indenture, subject in the case of Securities offered in
a Periodic Offering, to any conditions specified in such Opinion of
Counsel; and
(3) that such Securities together with any coupons appertaining
thereto, when authenticated and delivered by the trustee and issued by the
Company in the manner and subject to any conditions specified in such
Opinion of Counsel, will constitute valid and legally binding obligations
of the Company, enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
other similar laws of general applicability relating to or affecting the
enforcement of creditors' rights and to general equity principles and
except further as enforcement thereof may be limited by (A) requirements
that a claim with respect to any Securities denominated other than in
Dollars (or a Foreign Currency or currency unit judgment in respect of such
claim)
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be converted into 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 in Foreign Currencies or
currency units or payments outside the United States.
Notwithstanding that such form or terms have been so established, the
Trustee shall have the right to decline to authenticate such Securities if, in
the written opinion of counsel to the Trustee (which counsel may be an employee
of the Trustee) reasonably acceptable to the Company, the issue of such
Securities pursuant to this Indenture will adversely affect the Trustee's own
rights, duties or immunities under this Indenture or otherwise in a manner which
is not reasonably acceptable to the Trustee. Notwithstanding the generality of
the foregoing, the Trustee will not be required to authenticate Securities
denominated in a Foreign Currency if the Trustee reasonably believes that it
would be unable to perform its duties with respect to such Securities.
Notwithstanding the provisions of Section 3.01 and of the two
preceding paragraphs, if all of the Securities of any series are not to be
issued at one time, it shall not be necessary to deliver the Officers'
Certificate otherwise required pursuant to Section 3.01 or the Company Order and
Opinion of Counsel otherwise required pursuant to the two preceding paragraphs
in connection with the authentication of each Security of such series if such
documents, with appropriate modifications to cover such future issuances, are
delivered at or prior to the authentication upon original issuance of the first
Security of such series to be issued.
With respect to Securities of a series offered in a Periodic Offering,
the Trustee may rely, as to the authorization by the Company of any of such
securities, the form and terms thereof and the legality, validity, binding
effect and enforceability thereof, upon the Opinion of Counsel and the other
documents delivered pursuant to Sections 2.01 and 3.01 and this Section, as
applicable, in connection with the first authentication of Securities of such
series.
If the Company shall establish pursuant to Section 3.01 that the
Securities of a series are to be issued in whole or in part in global form, then
the Company shall execute and the Trustee shall, in accordance with this Section
and the Company Order with respect to such series, authenticate and deliver one
or more Securities of such series in global form that (i) shall represent and
shall be denominated in an amount equal to the aggregate principal amount of the
Outstanding Securities of such series to be represented by such Security or
Securities in global form, (ii) shall be registered, if a Registered Security,
in the name of the Depository for such Security or Securities in global
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form or the nominee of such Depository, (iii) shall be delivered by the Trustee
to such Depository or pursuant to such Depository's instruction and (iv) shall
bear the legends set forth in Section 2.04 and the terms of the Board Resolution
or supplemental indenture relating to such series.
Each Depository designated pursuant to Section 3.01 for a Registered
Security in global form must, at the time of its designation and at all times
while it serves as Depository, be a clearing agency registered under the
Securities Exchange Act of 1934, as amended, and any other applicable statute or
regulation. The Trustee shall have no responsibility to determine if the
Depository is so registered. Each Depository shall enter into an agreement with
the Trustee and the Company governing the respective duties and rights of such
Depository, the Company and the Trustee with regard to Securities issued in
global form.
Each Registered Security shall be dated the date of its authentication
and each Bearer Security shall be dated as of the date specified as contemplated
by Section 3.01.
No Security or coupon appertaining thereto shall be entitled to any
benefits under this Indenture or be valid or obligatory for any purpose until
the certificate of authentication substantially in the form provided herein is
executed by the manual signature of one of the authorized signatories of the
Trustee or an Authenticating Agent and no coupon shall be valid until the
Security to which it appertains has been so authenticated. Such signature upon
any Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered under this Indenture and is
entitled to the benefits of this Indenture. Except as permitted by Section 3.06
or 3.07, the Trustee shall not authenticate and deliver any Bearer Security
unless all appurtenant coupons for interest then matured have been detached and
canceled.
Notwithstanding the foregoing, if any Security shall have been
authenticated and delivered hereunder but never issued and sold by the Company,
and the Company shall deliver such Security to the Trustee for cancellation as
provided in Section 3.09 together with a written statement (which need not
comply with Section 1.02 and need not be accompanied by an Opinion of Counsel)
stating that such Security has never been issued and sold by the Company, for
all purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall not be entitled to the benefits
of this Indenture.
Section 3.04. TEMPORARY SECURITIES. Pending the preparation of
definitive Securities of any series, the Company may execute and, upon Company
Order, the Trustee shall
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authenticate and deliver temporary Securities of such series which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor and form, with or without coupons, of
the definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as conclusively evidenced by
their execution of such Securities and coupons, if any. In the case of
Securities of any series, such temporary Securities may be in global form,
representing all or a portion of the Outstanding Securities of such series.
Except in the case of temporary Securities in global form, each of
which shall be exchanged in accordance with the provisions thereof, if temporary
Securities of any series are issued, the Company will cause definitive
Securities of such series to be prepared without unreasonable delay. After
preparation of definitive Securities of such series, the temporary Securities of
such series shall be exchangeable for definitive Securities of such series upon
surrender of the temporary Securities of such series at the office or agency of
the Company pursuant to Section 9.02 in a Place of Payment for such series,
without charge to the Holder. Upon surrender for cancellation of any one or
more temporary Securities of any series (accompanied by any unmatured coupons
appertaining thereto), the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of the same series of authorized denominations and of like
tenor; PROVIDED, HOWEVER, that no definitive Bearer Security, except as may be
provided pursuant to Section 3.01, shall be delivered in exchange for a
temporary Registered Security; and provided further that no definitive Bearer
Security shall be delivered in exchange for a temporary Bearer Security unless
the Trustee shall have received from the person entitled to receive the
definitive Bearer Security a certificate substantially in the form approved in
or pursuant to the Board Resolutions relating thereto and such delivery shall
occur only outside the United States. Until so exchanged, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series except as otherwise
specified as contemplated by Section 3.01.
Section 3.05. REGISTRATION, TRANSFER AND EXCHANGE. The Company
shall cause to be kept at the Corporate Trust Office of the Trustee or in any
office or agency to be maintained by the Company in accordance with Section 9.02
in a Place of Payment a register (the "Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Registered Securities and the registration of transfers of
Registered Securities. The Register shall be in
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written form or any other form capable of being converted into written form
within a reasonable time. The Trustee is hereby appointed "Registrar" for the
purpose of registering Registered Securities and transfers of Registered
Securities as herein provided.
Upon surrender for registration of transfer of any Registered Security
of any series at the office or agency maintained pursuant to Section 9.02 in a
Place of Payment for that series, the Company shall execute and the Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Registered Securities of the same series, of any
authorized denominations and of a like aggregate principal amount containing
identical terms and provisions.
Bearer Securities or any coupons appertaining thereto shall be
transferable by delivery.
At the option of the Holder, Registered Securities of any series
(except a Registered Security in global form) may be exchanged for other
Registered Securities of the same series, of any authorized denominations and of
a like aggregate principal amount containing identical terms and provisions,
upon surrender of the Registered Securities to be exchanged at such office or
agency. Whenever any Registered Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the
Registered Securities which the Holder making the exchange is entitled to
receive. Unless otherwise specified as contemplated by Section 3.01, Bearer
Securities may not be issued in exchange for Registered Securities.
Unless otherwise specified as contemplated by Section 3.01, at the
option of the Holder, Bearer Securities of such series may be exchanged for
Registered Securities (if the Securities of such series are issuable in
registered form) or Bearer Securities (if Bearer Securities of such series are
issuable in more than one denomination and such exchanges are permitted by such
series) of the same series, of any authorized denominations and of like tenor
and aggregate principal amount, upon surrender of the Bearer Securities to be
exchanged at any such office or agency, with all unmatured coupons and all
matured coupons in default thereto appertaining. If the Holder of a Bearer
Security is unable to produce any such unmatured coupon or coupons or matured
coupon or coupons in default, such exchange may be effected if the Bearer
Securities are accompanied by payment in funds acceptable to the Company and the
Trustee in an amount equal to the face amount of such missing coupon or coupons,
or the surrender of such missing coupon or coupons may be waived by the Company
and the Trustee if there be furnished to them such security or indemnity as they
may require to save each
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of them and any Paying Agent harmless. If thereafter the Holder of such
Security shall surrender to any Paying Agent any such missing coupon in respect
of which such a payment shall have been made, such Holder shall be entitled to
receive the amount of such payment; PROVIDED, HOWEVER, that, except as otherwise
provided in Section 9.02, interest represented by coupons shall be payable only
upon presentation and surrender of those coupons at an office or agency located
outside the United States.
Notwithstanding the foregoing, in case any Bearer Security of any
series is surrendered at any such office or agency in exchange for a Registered
Security of the same series after the close of business at such office or agency
on (i) any Regular Record Date and before the opening of business at such office
or agency on the relevant Interest Payment Date, or (ii) any Special Record Date
and before the opening of business at such office or agency on the related date
for payment of Defaulted Interest, such Bearer Security shall be surrendered
without the coupon relating to such Interest Payment Date or proposed date of
payment, as the case may be (or, if such coupon is so surrendered with such
Bearer Security, such coupon shall be returned to the person so surrendering the
Bearer Security), and interest or Defaulted Interest, as the case may be, will
not be payable on such Interest Payment Date or proposed date for payment, as
the case may be, in respect of the Registered Security issued in exchange for
such Bearer Security, but will be payable only to the Holder of such coupon,
when due in accordance with the provisions of this Indenture.
Each Security issued in global form authenticated under this Indenture
shall be registered in the name of the Depository designated for such series or
a nominee thereof and delivered to such Depository or a nominee thereof or
custodian therefor, and each such Security issued in global form shall
constitute a single Security for all purposes of this Indenture.
Notwithstanding any other provision of this Section, unless and until
it is exchanged in whole or in part for Securities in certificated form in the
circumstances described below, a Security in global form representing all or a
portion of the Securities of a series may not be transferred except as a whole
by the Depository for such series to a nominee of such Depository or by a
nominee of such Depository to such Depository or another nominee of such
Depository or by such Depository or any such nominee to a successor Depository
for such series or a nominee of such successor Depository.
If at any time the Depository for the Securities of a series notifies
the Company that it is unwilling or unable to continue as Depository for the
Securities of such series or defaults in the performance of its duties as
Depository or if at any time the Depository for the Securities of such series
shall
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no longer be eligible under Section 3.03, the Company shall appoint a successor
Depository with respect to the Securities of such series. If a successor
Depository for the Securities of such series is not appointed by the Company
within 90 days after the Company receives such notice or becomes aware of such
ineligibility, the Company selection pursuant to Section 3.01(b)(24) shall no
longer be effective with respect to the Securities of such series and the
Company shall execute, and the Trustee, upon receipt of a Company Order for the
authentication and delivery of certificated Securities of such series of like
tenor, shall authenticate and deliver Securities of such series of like tenor in
certificated form, in authorized denominations and in an aggregate principal
amount equal to the principal amount of the Security or Securities of such
series of like tenor in global form in exchange for such Security or Securities
in global form.
The Company may at any time in its sole discretion determine that
Securities issued in global form shall no longer be represented by such a
Security or Securities in global form. In such event the Company shall execute,
and the Trustee, upon receipt of a Company Order for the authentication and
delivery of certificated Securities of such series of like tenor, shall
authenticate and deliver, Securities of such series of like tenor in
certificated form, in authorized denominations and in an aggregate principal
amount equal to the principal amount of the Security or Securities of such
series of like tenor in global form in exchange for such Security or Securities
in global form.
If specified by the Company pursuant to Section 3.01 with respect to a
series of Securities, the Depository for such series may surrender a Security in
global form of such series in exchange in whole or in part for Securities of
such series in certificated form on such terms as are acceptable to the Company
and such Depository. Thereupon, the Company shall execute, and the Trustee
shall authenticate and deliver, without service charge,
(i) to each Person specified by such Depository a new certificated
Security or Securities of the same series of like tenor, of any authorized
denomination as requested by such Person in aggregate principal amount
equal to and in exchange for such Person's beneficial interest in the
Security in global form; and
(ii) to such Depository a new Security in global form of like tenor in
a denomination equal to the difference, if any, between the principal
amount of the surrendered Security in global form and the aggregate
principal amount of certificated Securities delivered to Holders thereof.
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Upon the exchange of a Security in global form for Securities in
certificated form, such Security in global form shall be canceled by the
Trustee. Unless expressly provided with respect to the Securities of any series
that such Security may be exchanged for Bearer Securities, Securities in
certificated form issued in exchange for a Security in global form pursuant to
this Section shall be registered in such names and in such authorized
denominations as the Depository for such Security in global form, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall deliver such Securities to the Persons
in whose names such Securities are so registered.
Whenever any Securities are surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, the Securities
which the Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or upon any
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Registered Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company, the Registrar or
the Trustee) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company, the Registrar and the Trustee duly
executed by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
for any exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration or transfer or exchange of Securities, other
than exchanges pursuant to Section 3.04, 8.06 or 10.07 not involving any
transfer.
If the Securities of any series (or of any series and specified tenor)
are to be redeemed in part, the Company shall not be required (i) to issue,
register the transfer of, or exchange any Securities of that series for a period
beginning at the opening of business 15 days before the day of the mailing of a
notice of redemption of any such Securities selected for redemption under
Section 10.03 and ending at the close of business on the day of such mailing;
(ii) to register the transfer of or exchange any Registered Security so selected
for redemption, in whole or in part, except the unredeemed portion of any
Security being redeemed in part; or (iii) to exchange any Bearer Security so
selected for redemption, except that such a
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Bearer Security may be exchanged for a Registered Security of that series and
like tenor; PROVIDED that such Registered Security shall be simultaneously
surrendered for redemption.
The foregoing provisions relating to registration, transfer and
exchange may be modified, supplemented or superseded with respect to any series
of Securities by a Board Resolution or in one or more indentures supplemental
hereto.
Section 3.06. REPLACEMENT SECURITIES. If a mutilated Security or a
Security with a mutilated coupon appertaining to it is surrendered to the
Trustee, together with, in proper cases, such security or indemnity as may be
required by the Company or the Trustee to save each of them harmless, the
Company shall execute and the Trustee shall authenticate and deliver a
replacement Registered Security, if such surrendered Security was a Registered
Security, or a replacement Bearer Security with coupons corresponding to the
coupons appertaining to the surrendered Security, if such surrendered Security
was a Bearer Security, of the same series and date of maturity, if the Trustee's
requirements are met, containing identical terms and of like tenor and of like
principal amount.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
or coupon and (ii) such security or indemnity as may be required by them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to the Company or the Trustee that such Security or coupon has been
acquired by a bona fide purchaser, the Company shall execute and the Trustee
shall authenticate and deliver in lieu of any such destroyed, lost or stolen
Security or in exchange for the Security to which a destroyed, lost or stolen
coupon appertains (with all appurtenant coupons not destroyed, lost or stolen),
a replacement Registered Security, if such Holder's Claim appertains to a
Registered Security, or a replacement Bearer Security with coupons corresponding
to the coupons appertaining to the destroyed, lost or stolen Bearer Security or
the Bearer Security to which such lost, destroyed or stolen coupon appertains,
if such Holder's claim appertains to a Bearer Security, of the same series and
principal amount, containing identical terms and provisions and bearing a number
not contemporaneously outstanding with coupons corresponding to the coupons, if
any, appertaining to the destroyed, lost or stolen Security.
In case any such mutilated, destroyed, lost or stolen Security or
coupon has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Security or coupon, pay such Security
or coupon; PROVIDED, HOWEVER, that payment of principal of and any premium or
interest on Bearer Securities shall, except as otherwise provided in
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Section 9.02, be payable only at an office or agency located outside the United
States and, unless otherwise specified as contemplated by Section 3.01, any
interest on Bearer Securities shall be payable only upon presentation and
surrender of the coupons appertaining thereto.
Upon the issuance of any new Security under this Section, the Company
may require that payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee, its agents and
counsel) connected therewith.
Every new Security of any series with its coupons, if any, issued
pursuant to this Section in lieu of any destroyed, lost or stolen Security, or
in exchange for a Security to which a destroyed, lost or stolen coupon
appertains, shall constitute an original additional contractual obligation of
the Company, whether or not the destroyed, lost or stolen Security and its
coupon, if any, or the destroyed, lost or stolen coupon, shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Securities of that
series and their coupons, if any, duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities or coupons.
Section 3.07. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED. (a)
Unless otherwise provided as contemplated by Section 3.01 with respect to any
series of Securities, interest, if any, on any Registered Security which is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date.
Unless otherwise provided as contemplated by Section 3.01 with respect
to any series of Securities, (i) interest, if any, on Bearer Securities shall be
paid only against presentation and surrender of the coupons for such interest
installments as are evidenced thereby as they mature and (ii) original issue
discount, if any, on Bearer Securities shall be paid only against presentation
and surrender of such Securities; in either case at the office of a Paying Agent
located outside the United States, unless the Company shall have otherwise
instructed the Trustee in writing, provided that any such instruction for
payment in the United States does not cause any Bearer Security to be treated as
a "registration-required obligation" under United States laws and regulations.
The interest, if any, on any temporary Bearer
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Security shall be paid, as to any installment of interest evidenced by a coupon
attached thereto only upon presentation and surrender of such coupon and, as to
other installments of interest, only upon presentation of such Security for
notation thereon of the payment of such interest. If at the time a payment of
principal of or interest, if any, on a Bearer Security or coupon shall become
due, the payment of the full amount so payable at the office or offices of all
the Paying Agents outside the United States is illegal or effectively precluded
because of the imposition of exchange controls or other similar restrictions on
the payment of such amount in Dollars, then the Company may instruct the Trustee
in writing to make such payments at a Paying Agent located in the United States,
provided that provision for such payment in the United States would not cause
such Bearer Security to be treated as a "registration-required obligation" under
United States laws and regulations.
(b) Unless otherwise provided as contemplated by Section 3.01 with
respect to any series of Securities, any interest on Registered Securities of
any series which is payable, but is not punctually paid or duly provided for, on
any Interest Payment Date for such Registered Securities (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holders on the
relevant Regular Record Date by virtue of their having been such Holders, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of such Defaulted
Interest to the Persons in whose names such Registered Securities (or
their respective Predecessor Securities) are registered at the close
of business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company
shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for
such deposit prior to the date of the proposed payment, such money
when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this clause (1) provided.
Thereupon the Trustee shall fix a Special Record Date for the payment
of such Defaulted Interest which shall be not more than 15 days and
not less than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of the notice
of the proposed payment. The Trustee shall promptly notify the
Company of such Special Record Date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor to be
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mailed, first-class postage prepaid, to each Holder of such Registered
Securities at his address as it appears in the Register, not less than
10 days prior to such Special Record Date. Notice of the proposed
payment of such Defaulted Interest and the Special Record Date
therefor having been so mailed, such Defaulted Interest shall be paid
to the Persons in whose names such Registered Securities (or their
respective Predecessor Securities) are registered at the close of
business on such Special Record Date and shall no longer be payable
pursuant to the following clause (2). In case a Bearer Security of
any series is surrendered at the office or agency in a Place of
Payment for such series in exchange for a Registered Security of such
series after the close of business at such office or agency on the
related proposed date for payment of Defaulted Interest, such Bearer
Security shall be surrendered without the coupon relating to such
proposed date of payment in respect of the Registered Security issued
in exchange for such Bearer Security, but will be payable only to the
Holder of such coupon when due in accordance with the provisions of
this Indenture.
(2) The Company may make payment of such Defaulted Interest to
the Persons in whose names such Registered Securities (or their
respective Predecessor Securities) are registered at the close of
business on a specified date in any other lawful manner not
inconsistent with the requirements of any securities exchange on which
such Registered Securities may be listed, and upon such notice as may
be required by such exchange, if, after notice given by the Company to
the Trustee of the proposed payment pursuant to this clause (2), such
manner of payment shall be deemed practicable by the Trustee.
(c) Subject to the foregoing provisions of this Section and Section
3.05, each Security delivered under this Indenture upon registration of transfer
of or in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
Section 3.08. PERSONS DEEMED OWNERS. Prior to due presentment of any
Registered 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 such
Registered Security is registered as the owner of such Registered Security for
the purpose of receiving payment of principal of, premium, if any, and (subject
to Sections 3.05 and 3.07) interest on and Additional Amounts with respect to
such Registered Security and for all other purposes whatsoever, whether or not
such Registered Security be overdue, and neither the Company, the Trustee nor
any
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agent of the Company or the Trustee shall be affected by notice to the contrary.
The Company, the Trustee and any agent of the Company or the Trustee
may treat the bearer of any Bearer Security and the bearer of any coupon as the
absolute owner of such Bearer Security or coupon for the purpose of receiving
payment thereof or on account thereof and for all other purposes whatsoever,
whether or not such Bearer Security or coupon be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
None of the Company, the Trustee or any agent of the Company or the
Trustee shall have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership interests of a
Security in global form, or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests. Notwithstanding the
foregoing, with respect to any Security in global form, nothing herein shall
prevent the Company or the Trustee, or any agent of the Company or the Trustee,
from giving effect to any written certification, proxy or other authorization
furnished by any Depository (or its nominee) as a Holder, with respect to such
Security in global form or impair, as between such Depository and owners of
beneficial interests in such Security in global form, the operation of customary
practices governing the exercise of the rights of such Depository (or its
nominee) as Holder of such Security in global form.
Section 3.09. CANCELLATION. The Company at any time may deliver
Securities and coupons to the Trustee for cancellation. The Registrar and any
Paying Agent shall forward to the Trustee any Securities and coupons surrendered
to them for replacement, for registration of transfer, or for exchange or
payment. The Trustee shall cancel all Securities and coupons surrendered for
replacement, for registration of transfer, or for exchange, payment, redemption
or cancellation and may, but shall not be required to, dispose of canceled
Securities and coupons and issue a certificate of destruction to the Company.
The Company may not issue new Securities to replace Securities that it has paid
or delivered to the Trustee for cancellation.
Section 3.10. COMPUTATION OF INTEREST. Except as otherwise specified
as contemplated by Section 3.01, interest on the Securities of each series shall
be computed on the basis of a 360-day year of twelve 30-day months.
Section 3.11. CUSIP NUMBERS. The Company in issuing the Securities
may use "CUSIP" numbers (if then generally in use), and, in such case, the
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders; PROVIDED that any such notice may state that no representation is made
as to
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the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
Section 3.12. CURRENCY AND MANNER OF PAYMENT IN RESPECT OF
SECURITIES. (a) Unless otherwise specified with respect to any Securities
pursuant to Section 3.01, with respect to Registered Securities of any series
not permitting the election provided for in paragraph (b) below or the Holders
of which have not made the election provided for in paragraph (b) below, and
with respect to Bearer Securities of any series, except as provided in paragraph
(d) below, payment of the principal of, premium, if any, and interest, if any,
on any Registered or Bearer Security of such series will be made in the currency
or currencies or currency unit or units in which such Registered Security or
Bearer Security, as the case may be, is payable. The provisions of this Section
3.12 may be modified or superseded pursuant to Section 3.01 with respect to any
Securities.
(b) It may be provided pursuant to Section 3.01, with respect to
Registered Securities of any series, that Holders shall have the option, subject
to paragraphs (d) and (e) below, to receive payments of principal of, premium,
if any, or interest, if any, on such Registered Securities in any of the
currencies or currency units which may be designated for such election by
delivering to the Trustee (or the applicable Paying Agent) a written election
with signature guarantees and in the applicable form established pursuant to
Section 3.01, not later than the close of business on the Election Date
immediately preceding the applicable payment date. If a Holder so elects to
receive such payments in any such currency or currency unit, such election will
remain in effect for such Holder or any transferee of such Holder until changed
by such Holder or such transferee by written notice to the Trustee (or any
applicable Paying Agent) for such series of Registered Securities (but any such
change must be made not later than the close of business on the Election Date
immediately preceding the next payment date to be effective for the payment to
be made on such payment date, and no such change of election may be made with
respect to payments to be made on any Registered Security of such series with
respect to which an Event of Default has occurred or with respect to which the
Company has deposited funds pursuant to Article IV or with respect to which a
notice of redemption has been given by or on behalf of the Company pursuant to
Article X). Any Holder of any such Registered Security who shall not have
delivered any such Election to the Trustee (or any applicable Paying Agent) not
later than the close of business on the applicable Election Date will be paid
the amount due on the applicable payment date in the relevant currency or
currency unit as provided in Section
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3.12(a). The Trustee (or the applicable Paying Agent) shall notify the Exchange
Rate Agent as soon as practicable after the Election Date of the aggregate
principal amount of Registered Securities for which Holders have made such
written election.
(c) If the election referred to in paragraph (b) above has been
provided for with respect to any Registered Securities of a series pursuant to
Section 3.01, then, unless otherwise specified pursuant to Section 3.01 with
respect to any such Registered Securities, not later than the fourth Business
Day after the Election Date for each payment date for such Registered
Securities, the Exchange Rate Agent will deliver to the Company a written notice
specifying, in the currency or currencies or currency unit or units in which
Registered Securities of such series are payable, the respective aggregate
amounts of principal of, premium, if any, and interest, if any, on such
Registered Securities to be paid on such payment date, and specifying the
amounts in such currency or currencies or currency unit or units so payable in
respect of such Registered Securities as to which the Holders of Registered
Securities denominated in any currency or currencies or currency unit or units
shall have elected to be paid in another currency or currency unit as provided
in paragraph (b) above. If the election referred to in paragraph (b) above has
been provided for with respect to any Registered Securities of a series pursuant
to Section 3.01, and if at least one Holder has made such election, then, unless
otherwise specified pursuant to Section 3.01, on the second Business Day
immediately preceding such payment date the Company will deliver to the Trustee
(or the applicable Paying Agent) an Exchange Rate Officers' Certificate in
respect of the Dollar, Foreign Currency or Currencies, ECU or other currency
unit payments to be made on such payment date. Unless otherwise specified
pursuant to Section 3.01, the Dollar, Foreign Currency or Currencies, ECU or
other currency unit amount receivable by Holders of Registered Securities who
have elected payment in a currency or currency unit as provided in paragraph (b)
above shall be determined by the Company on the basis of the applicable Market
Exchange Rate in effect on the second Business Day (the "Valuation Date")
immediately preceding each payment date, and such determination shall be
conclusive and binding for all purposes, absent manifest error.
(d) If a Conversion Event occurs with respect to a Foreign Currency,
ECU or any other currency unit in which any of the Securities are denominated or
payable otherwise than pursuant to an election provided for pursuant to
paragraph (b) above, then, with respect to each date for the payment of
principal of, premium, if any, and interest, if any, on the applicable
Securities denominated or payable in such Foreign Currency, ECU or such other
currency unit occurring after the last date on which such Foreign Currency, ECU
or such other currency unit was used (the "Conversion Date"), the Dollar shall
be the currency of
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payment for use on each such payment date (but such Foreign Currency, ECU or
such other currency unit that was previously the currency of payment shall, at
the Company's election, resume being the currency of payment on the first such
payment date preceded by 15 Business Days during which the circumstances which
gave rise to the Dollar becoming such currency no longer prevail). Unless
otherwise specified pursuant to Section 3.01, the Dollar amount to be paid by
the Company to the Trustee or any applicable Paying Agent and by the Trustee or
any applicable Paying Agent to the Holders of such Securities with respect to
such payment date shall be, in the case of a Foreign Currency other than a
currency unit, the Dollar Equivalent of the Foreign Currency or in the case of a
Foreign Currency that is a currency unit, the Dollar Equivalent of the Currency
limit, in each case as determined by the Exchange Rate Agent in the manner
provided in paragraph (f) or (g) below.
(e) Unless otherwise specified pursuant to Section 3.01, if the Holder
of a Registered Security denominated in any currency or currency unit shall have
elected to be paid in another currency or currency unit or in other currencies
as provided in paragraph (b) above, and (i) a Conversion Event occurs with
respect to any such elected currency or currency unit, such Holder shall receive
payment in the currency or currency unit in which payment would have been made
in the absence of such election and (ii) if a Conversion Event occurs with
respect to the currency or currency unit in which payment would have been made
in the absence of such election, such Holder shall receive payment in Dollars as
provided in paragraph (d) of this Section 3.12 (but, subject to any contravening
valid election pursuant to paragraph (b) above, the elected payment currency or
currency unit, in the case of the circumstances described in clause (i) above,
or the payment currency or currency unit in the absence of such election, in the
case of the circumstances described in clause (ii) above, shall, at the
Company's election, resume being the currency or currency unit of payment with
respect to Holders who have so elected, but only with respect to payments on
payment dates preceded by 15 Business Days during which the circumstances which
gave rise to such currency or currency unit, in the case of the circumstances
described in clause (i) above, or the Dollar, in the case of the circumstances
described in clause (ii) above, as applicable, becoming the currency or currency
unit of payment, no longer prevail).
(f) The "Dollar Equivalent of the Foreign Currency" shall be
determined by the Exchange Rate Agent and shall be obtained for each subsequent
payment date by the Exchange Rate Agent by converting the specified Foreign
Currency into Dollars at the Market Exchange Rate on the Conversion Date.
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(g) The "Dollar Equivalent of the Currency Unit" shall be determined
by the Exchange Rate Agent and, subject to the provisions of paragraph (h)
below, shall be the sum of each amount obtained by converting the specified
amount of each Component Currency (as each such term is defined in paragraph (h)
below) into Dollars at the Market Exchange Rate for such Component Currency on
the Valuation Date with respect to each payment.
(h) For purposes of this Section 3.12 the following terms shall have
the following meanings:
A "Component Currency" shall mean any currency which, on the
Conversion Date, was a component currency of the relevant currency
unit, including, but not limited to, ECU.
"Election Date" shall mean the Regular Record Date for the
applicable series of Registered Securities as specified pursuant to
Section 3.01 by which the written election referred to in Section
3.12(b) may be made.
A "Specified Amount" of a Component Currency shall mean the
number of units of such Component Currency or fractions thereof which
such Component Currency represented in the relevant currency unit,
including, but not limited to, ECU, on the Conversion Date. If after
the Conversion Date the official unit of any Component Currency is
altered by way of combination or subdivision, the Specified Amount of
such Component Currency shall be divided or multiplied in the same
proportion. If after the Conversion Date two or more Component
Currencies are consolidated into a single currency, the respective
Specified Amounts of such Component Currencies shall be replaced by an
amount in such single currency equal to the sum of the respective
specified Amounts of such consolidated Component Currencies expressed
in such single currency, and such amount shall thereafter be a
Specified Amount and such single currency shall thereafter be a
Component Currency. If after the Conversion Date any Component
Currency shall be divided into two or more currencies, the Specified
Amount of such Component Currency shall be replaced by specified
amounts of such two or more currencies, the sum of which, at the
Market Exchange Rate of such two or more currencies on the date of
such replacement, shall be equal to the Specified Amount of such
former Component Currency and such amounts shall thereafter be
Specified Amounts and such currencies shall thereafter be Component
Currencies. If, after the Conversion Date of the relevant currency
unit, including, but not limited to, ECU, a Conversion Event
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(other than any event referred to above in this definition of
"Specified Amount") occurs with respect to any Component Currency of
such currency unit and is continuing on the applicable Valuation Date,
the Specified Amount of such Component Currency shall, for purposes of
calculating the Dollar Equivalent of the Currency Unit, be converted
into Dollars at the Market Exchange Rate in effect on the Conversion
Date of such Component Currency.
All decisions and determinations of the Exchange Rate Agent regarding
the Dollar Equivalent of the Foreign Currency, the Dollar Equivalent of the
Currency Unit, the Market Exchange Rate and changes in the Specified Amounts as
specified above shall be in its sole discretion and shall, in the absence of
manifest error, be conclusive for all purposes and irrevocably binding upon the
Company, the Trustee (and any applicable Paying Agent) and all Holders of
Securities denominated or payable in the relevant currency, currencies or
currency units. The Exchange Rate Agent shall promptly give written notice to
the Company and the Trustee of any such decision or determination.
In the event that the Company determines in good faith that a
Conversion Event has occurred with respect to a Foreign Currency, the Company
will promptly give written notice thereof to the Trustee of the appropriate
series of Securities (or any applicable Paying Agent) and to the Exchange Rate
Agent (and the Trustee (or such Paying Agent) will promptly thereafter give
notice in the manner provided in Section 1.06 to the affected Holders)
specifying the Conversion Date. In the event the Company so determines that a
Conversion Event has occurred with respect to ECU or any other currency unit in
which Securities are denominated or payable, the Company will promptly give
written notice thereof to the Trustee (or any applicable Paying Agent) and to
the Exchange Rate Agent (and the Trustee (or such Paying Agent) will promptly
thereafter give notice in the manner provided in Section 1.06 to the affected
Holders) specifying the Conversion Date and the Specified Amount of each
Component Currency on the Conversion Date. In the event the Company determines
in good faith that any subsequent change in any Component Currency as set forth
in the definition of Specified Amount above has occurred, the Company will
similarly give written notice to the Trustee (or any applicable Paying Agent)
and to the Exchange Rate Agent.
The Trustee of the appropriate series of Securities shall be fully
justified and protected in relying and acting upon information received by it
from the Company and the Exchange Rate Agent and shall not otherwise have any
duty or obligation to determine the accuracy or validity of such information
independent of the Company or the Exchange Rate Agent.
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Section 3.13. APPOINTMENT AND RESIGNATION OF EXCHANGE RATE AGENT.
(a) Unless otherwise specified pursuant to Section 3.01, if and so long as the
Securities of any series (i) are denominated in a currency other than Dollars or
(ii) may be payable in a currency other than Dollars, or so long as it is
required under any other provision of this Indenture, then the Company will
maintain with respect to each such series of Securities, or as so required, at
least one Exchange Rate Agent. The Company will cause the Exchange Rate Agent
to make the necessary foreign exchange determinations at the time and in the
manner specified pursuant to Section 3.12 for the purpose of determining the
applicable rate of exchange and, if applicable, for the purpose of converting
the issued currency or currencies or currency unit or units into the applicable
payment currency or currency unit for the payment of principal, premium, if any,
and interest, if any, pursuant to Section 3.12.
(b) No resignation of the Exchange Rate Agent and no appointment of a
successor Exchange Rate Agent pursuant to this Section shall become effective
until the acceptance of appointment by the successor Exchange Rate Agent as
evidenced by a written instrument delivered to the Company and the Trustee of
the appropriate series of Securities accepting such appointment executed by the
successor Exchange Rate Agent.
(c) If the Exchange Rate Agent shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of the Exchange
Rate Agency for any cause, with respect to the Securities of one or more series,
the Company, by or pursuant to a Board Resolution, shall promptly appoint a
successor Exchange Rate Agent or Exchange Rate Agents with respect to the
Securities of that or those series (it being understood that any such successor
Exchange Rate Agent may be appointed with respect to the Securities of one or
more or all of such series and that, unless otherwise specified pursuant to
Section 3.01 at any time there shall only be one Exchange Rate Agent with
respect to the Securities of any particular series that are originally issued by
the Company on the same date and that are initially denominated and/or payable
in the same currency or currencies or currency unit or units).
ARTICLE IV
Satisfaction, Discharge and Defeasance
Section 4.01. TERMINATION OF COMPANY'S OBLIGATIONS UNDER THE
INDENTURE. This Indenture shall upon a Company Request cease to be of further
effect with respect to Securities of or within any series and any coupons
appertaining thereto (except as to any surviving rights of registration of
transfer or exchange of such Securities and replacement of such Securities which
may
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have been lost, stolen or mutilated as herein expressly provided for) and the
Trustee, at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture (including but not
limited to Article XII) with respect to such Securities and any coupons
appertaining thereto when (1) either
(A) all such Securities previously authenticated and delivered and all
coupons appertaining thereto (other than (i) such coupons appertaining to
Bearer Securities surrendered in exchange for Registered Securities and
maturing after such exchange, surrender of which is not required or has
been waived as provided in Section 3.05, (ii) such Securities and coupons
which have been destroyed, lost or stolen and which have been replaced or
paid, as provided in Section 3.06, (iii) such coupons appertaining to
Bearer Securities called for redemption and maturing after the relevant
Redemption Date, surrender of which has been waived as provided in Section
10.06 and (iv) such Securities and coupons for whose payment money has
theretofore been deposited in trust or segregated and held in trust by the
Company and thereafter repaid to the Company or discharged from such trust
as provided in Section 9.03) have been delivered to the Trustee for
cancellation; or
(B) all Securities of such series and, in the case of (i) or (ii)
below, any coupons appertaining thereto not theretofore delivered to the
Trustee for cancellation (i) have become due and payable, or (ii) will
become due and payable at their Stated Maturity within one year, or (iii)
if redeemable at the option of the Company, are to be called for redemption
within one year under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name, and at the
expense, of the Company, and the Company, in the case of (i), (ii) or (iii)
above, has irrevocably deposited or caused to be deposited with the Trustee
as trust funds in trust for the purpose an amount in the currency or
currencies or currency unit or units in which the Securities of such series
are payable, sufficient to pay and discharge the entire indebtedness on
such Securities and such coupons not theretofore delivered to the Trustee
for cancellation, for principal, premium, if any, and interest, and any
Additional Amounts payable as specified pursuant to Section 3.01(b)(17)
with respect thereto, to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated Maturity or
Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all
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conditions precedent herein provided for relating to the satisfaction and
discharge of this Indenture as to such series have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligation of the Company to the Trustee and any predecessor Trustee under
Section 6.09, the obligations of the Company to any Authenticating Agent under
Section 6.14 and, if money shall have been deposited with the Trustee pursuant
to subclause (B) of clause (1) of this Section, the obligations of the Trustee
under Section 4.02 and the last paragraph of Section 9.03 shall survive.
Section 4.02. APPLICATION OF TRUST FUNDS. Subject to the provisions
of the last paragraph of Section 9.03, all money deposited with the Trustee
pursuant to Section 4.01 shall be held in trust and applied by it, in accordance
with the provisions of the Securities, the coupons and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the persons
entitled thereto, of the principal, premium, if any, and any interest for whose
payment such money has been deposited with or received by the Trustee, but such
money need not be segregated from other funds except to the extent required by
law.
Section 4.03. APPLICABILITY OF DEFEASANCE PROVISIONS; COMPANY'S
OPTION TO EFFECT DEFEASANCE OR COVENANT DEFEASANCE. If pursuant to Section 3.01
provision is made for either or both of (i) defeasance of the Securities of or
within a series under Section 4.04 or (ii) covenant defeasance of the Securities
of or within a series under Section 4.05, then the provisions of such Section or
Sections, as the case may be, together with the provisions of Sections 4.06
through 4.09 inclusive, with such modifications thereto as may be specified
pursuant to Section 3.01 with respect to any Securities, shall be applicable to
such Securities and any coupons appertaining thereto, and the Company may at its
option by or pursuant to Board Resolution, at any time, with respect to such
Securities and any coupons appertaining thereto, elect to have Section 4.04 (if
applicable) or Section 4.05 (if applicable) be applied to such Outstanding
Securities and any coupons appertaining thereto upon compliance with the
conditions set forth below in this Article.
Section 4.04. DEFEASANCE AND DISCHARGE. Upon the Company's exercise
of the option specified in Section 4.03 applicable to this Section with respect
to the Securities of or within a series, the Company shall be deemed to have
been discharged from its obligations with respect to such Securities and any
coupons appertaining thereto on and after the date the conditions set forth in
Section 4.06 are satisfied (hereinafter "defeasance"). For this purpose, such
defeasance means that the
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Company shall be deemed to have paid and discharged the entire indebtedness
represented by such Securities and any coupons appertaining thereto which shall
thereafter be deemed to be "Outstanding" only for the purposes of Section 4.07
and the other Sections of this Indenture referred to in clause (ii) of this
Section, and to have satisfied all its other obligations under such Securities
and any coupons appertaining thereto and this Indenture insofar as such
Securities and any coupons appertaining thereto are concerned (and the Trustee,
at the expense of the Company, shall on a Company Order execute proper
instruments acknowledging the same), except the following which shall survive
until otherwise terminated or discharged hereunder: (i) the rights of Holders of
such Securities and any coupons appertaining thereto to receive solely from the
trust funds described in Section 4.06(a) and as more fully set forth in such
Section, payments in respect of the principal of, premium, if any, and interest,
if any, on such Securities or any coupons appertaining thereto when such
payments are due; (ii) the Company's obligations with respect to such Securities
under Sections 3.04, 3.05, 3.06, 9.02 and 9.03 and with respect to the payment
of additional amounts, if any, payable with respect to such Securities as
specified pursuant to Section 3.01(b)(17); (iii) the rights, powers trusts,
duties and immunities of the Trustee hereunder and (iv) this Article IV.
Subject to compliance with this Article IV, the Company may exercise its option
under this Section notwithstanding the prior exercise of its option under
Section 4.05 with respect to such Securities and any coupons appertaining
thereto. Following a defeasance, payment of such Securities may not be
accelerated because of an Event of Default.
Section 4.05. COVENANT DEFEASANCE. Upon the Company's exercise of
the option specified in Section 4.03 applicable to this Section with respect to
any Securities of or within a series, the Company shall be released from its
obligations under Sections 7.01(3), 7.01(4) and 9.07 and, if specified pursuant
to Section 3.01, its obligations under any other covenant, with respect to such
Securities and any coupons appertaining thereto on and after the date the
conditions set forth in Section 4.06 are satisfied (hereinafter, "covenant
defeasance"), and such Securities and any coupons appertaining thereto shall
thereafter be deemed to be not "Outstanding" for the purposes of any direction,
waiver, consent or declaration or Act of Holders (and the consequences of any
thereof) in connection with Sections 7.01(3), 7.01(4)and 9.07 or such other
covenant but shall continue to be deemed "Outstanding" for all other purposes
hereunder. For this purpose, such covenant defeasance means that, with respect
to such Securities and any coupons appertaining thereto, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such Section or such other covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
Section or such other covenant or by
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reason of reference in any such Section or such other covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 5.01(3) or 5.01(7), or
otherwise, as the case may be, but, except as specified above, the remainder of
this Indenture and such Securities and any coupons appertaining thereto shall be
unaffected thereby.
Section 4.06. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE. The
following shall be the conditions to application of Section 4.04 or Section 4.05
to any Securities of or within a series and any coupons appertaining thereto:
(a) The Company shall have deposited or caused to be deposited
irrevocably with the Trustee (or another trustee satisfying the
requirements of Section 6.12 who shall agree to comply with and shall be
entitled to the benefits of, the provisions of Sections 4.03 through 4.09
inclusive and the last paragraph of Section 9.03 applicable to the Trustee,
for purposes of such Sections also a "Trustee") as trust funds in trust for
the purpose of making the payments referred to in clauses (x) and (y) of
this Section 4.06(a), specifically pledged as security for, and dedicated
solely to, the benefit of the Holders of such Securities and any coupons
appertaining thereto, with instructions to the Trustee as to the
application thereof, (A) money in an amount (in such currency, currencies
or currency unit or units in which such Securities and any coupons
appertaining thereto are then specified as payable at Maturity), or (B) if
Securities of such series are not subject to repayment at the option of
Holders, Government Obligations which through the payment of interest,
principal, premium, if any, and any Additional Amounts in respect thereof
in accordance with their terms will provide not later than one day before
the due date of any payment referred to in clause (x) or (y) of this
Section 4.06(a), money in an amount or (C) a combination thereof in an
amount, sufficient, without reinvestment, in the opinion of a nationally
recognized firm of independent certified public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and
discharge, and which shall be applied by the Trustee to pay and discharge
(x) the principal of, premium, if any, and interest, if any, and any
Additional Amounts on such Securities and any coupons appertaining thereto
on the Maturity of such principal or installment of principal or interest
and (y) any mandatory sinking fund payments applicable to such Securities
on the day on which such payments are due and payable in accordance with
the terms of this Indenture and such Securities and any coupons
appertaining thereto. Before such a deposit, the Company may make
arrangements satisfactory to the Trustee for the redemption of Securities
at a future date or dates in
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accordance with Article X which shall be given effect in applying the
foregoing.
(b) Such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a Default or Event of Default under,
this Indenture or result in a breach or violation of, or constitute a
default under, any other agreement or instrument to which the Company is a
party or by which it is bound.
(c) In the case of an election under Section 4.04, the Company shall
have delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel to the effect that (i) the Company has received from, or there has
been published by, the Internal Revenue Service a ruling, or (ii) since the
date of execution of this Indenture, there has been a change in the
applicable Federal income tax law, in either case to the effect that, and
based thereon such opinion shall confirm that, the Holders of such
Securities and any coupons appertaining thereto will not recognize income,
gain or loss for Federal income tax purposes as a result of such defeasance
and will be subject to Federal income tax on the same amount and in the
same manner and at the same times, as would have been the case if such
deposit, defeasance and discharge had not occurred.
(d) In the case of an election under Section 4.05, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of such Securities and any coupons appertaining thereto will not
recognize income, gain or loss for Federal income tax purposes as a result
of such covenant defeasance and will be subject to Federal income tax on
the same amounts, in the same manner and at the same times as would have
been the case if such covenant defeasance had not occurred.
(e) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent to the defeasance under Section 4.04 or the covenant defeasance
under Section 4.05 (as the case may be) including those contained in this
Section 4.06 other than the 90 day period specified in Section 4.06(g),
have been complied with.
(f) The Company shall have delivered to the Trustee an Officer's
Certificate to the effect that neither such Securities nor any other
Securities of the same series, if then listed on any securities exchange,
will be delisted as a result of such deposit.
(g) No event which is, or after notice or lapse of time or both would
become, an Event of Default with respect to
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such Securities or any other Securities shall have occurred and be
continuing at the time of such deposit or, with regard to any such event
specified in Sections 5.01(5) and (6), at any time on or prior to the 90th
day after the date of such deposit (it being understood that this condition
shall not be deemed satisfied until after such 90th day).
(h) Such defeasance or covenant defeasance shall not result in the
trust arising from such deposit constituting an investment company within
the meaning of the Investment Company Act of 1940 unless such trust shall
be registered under such Act or exempt from registration thereunder.
(i) Such defeasance or covenant defeasance shall be effected in
compliance with any additional or substitute terms, conditions or
limitations which may be imposed on the Company in connection therewith as
contemplated by Section 3.01.
(j) No event or condition shall exist that, pursuant to Article XII,
would prevent the Company from making payments of principal of, premium, if
any, interest, if any, and any Additional Amounts on the Securities.
Section 4.07. DEPOSITED MONEY AND GOVERNMENT OBLIGATIONS TO BE HELD
IN TRUST. Subject to the provisions of the last paragraph of Section 9.03, all
money and Government Obligations (or other property as may be provided pursuant
to Section 3.01) (including the proceeds thereof) deposited with the Trustee
pursuant to Section 4.06 in respect of any Securities of any series and any
coupons appertaining thereto shall be held in trust and applied by the Trustee,
in accordance with the provisions of such Securities and any coupons
appertaining thereto and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as its own Paying Agent)
as the Trustee may determine, to the Holders of such Securities and any coupons
appertaining thereto of all sums due and to become due thereon in respect of
principal, premium, if any, and interest, if any, and any Additional Amounts,
but such money need not be segregated from other funds except to the extent
required by law.
Unless otherwise specified with respect to any Security pursuant to
Section 3.01, if, after a deposit referred to in Section 4.06(a) has been made,
(i) the Holder of a Security in respect of which such deposit was made is
entitled to, and does, elect pursuant to Section 3.12(b) or the terms of such
Security to receive payment in a currency or currency unit other than that in
which the deposit pursuant to Section 4.06(a) has been made in respect of such
Security, or (ii) a Conversion Event occurs as contemplated in Section 3.12(d)
or 3.12(e) or by the terms of any Security in respect of indebtedness which the
deposit pursuant to
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Section 4.06(a) has been made, the indebtedness represented by such Security and
any coupons appertaining thereto shall be deemed to have been, and will be,
fully discharged and satisfied through the payment of the principal of, premium,
if any, and interest, if any, on such Security as the same becomes due out of
the proceeds yielded by converting (from time to time as specified below in the
case of any such election) the amount or other property deposited in respect of
such Security into the currency or currency unit in which such Security becomes
payable as a result of such election or Conversion Event based on the applicable
Market Exchange Rate for such currency or currency unit in effect on the second
Business Day prior to each payment date, except, with respect to a Conversion
Event, for such currency or currency unit in effect (as nearly as feasible) at
the time of the Conversion Event.
Section 4.08. REPAYMENT TO COMPANY. Subject to the last paragraph of
Section 9.03, the Trustee (and any Paying Agent) shall promptly pay to the
Company upon Company Request any excess money or securities held by them at any
time.
Section 4.09. INDEMNITY FOR GOVERNMENT OBLIGATIONS. The Company
shall pay, and shall indemnify the Trustee against, any tax, fee or other charge
imposed on or assessed against Government Obligations deposited pursuant to this
Article or the principal and interest and any other amount received on such
Government Obligations.
Section 4.10. REINSTATEMENT. If the Trustee or the Paying Agent is
unable to apply any money or Government Obligations, as the case may be, in
accordance with this Article with respect to any Securities by reason of any
order or judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, then the obligations under this
Indenture, such Securities and any coupons appertaining thereto from which the
Company has been discharged or released pursuant to Section 4.04 or 4.05 shall
be revived and reinstated as though no deposit had occurred pursuant to this
Article with respect to such Securities, until such time as the Trustee or
Paying Agent is permitted to apply all money or Government Obligations, as the
case may be, held in trust pursuant to Section 4.07 with respect to such
Securities and any coupons appertaining thereto in accordance with this Article;
PROVIDED, HOWEVER, that if the Company makes any payment of principal of or any
premium or interest on any such Security following such reinstatement of its
obligations, the Company shall be subrogated to the rights (if any) of the
Holders of such Securities or coupons to receive such payment from the money or
Government Obligations, as the case may be, so held in trust.
ARTICLE V
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Defaults and Remedies
Section 5.01. EVENTS OF DEFAULT. An "Event of Default" occurs with
respect to the Securities of any series if (whatever the reason for such Event
of Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any payment, decree or order of any court or any
order, rule or regulation of any administrative or governmental body):
(1) the Company defaults in the payment of interest on any
Security of that series or any coupon appertaining thereto or any
additional amount payable with respect to any Security of that series
as specified pursuant to Section 3.01(b)(17) when the same becomes due
and payable and such default continues for a period of 30 days;
(2) the Company defaults in the payment of the principal of or
any premium on any Security of that series when the same becomes due
and payable at its Maturity or on redemption or otherwise, or in the
payment of a mandatory sinking fund payment when and as due by the
terms of the Securities of that series;
(3) the Company fails to comply in any material respect with any
of its agreements or covenants in, or any of the provisions of, this
Indenture with respect to any Security of that series (other than an
agreement, covenant or provision for which non-compliance is elsewhere
in this Section specifically dealt with), and such non-compliance
continues for a period of 60 days after there has been given by
registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the Holders of at least 25% in principal
amount of the Outstanding Securities of the series, a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder;
(4) a default under any mortgage, agreement, indenture or
instrument under which there may be issued, or by which there may be
secured, guaranteed or evidenced any Debt of the Company (including
this Indenture) whether such Debt now exists or shall hereafter be
created, in an aggregate principal amount then outstanding of
$25,000,000 or more, which default (a) shall constitute a failure to
pay any portion of the principal of such Debt when due and payable
after the expiration of an applicable grace period with
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respect thereto or (b) shall result in such Debt becoming or being
declared due and payable prior to the date on which it would otherwise
become due and payable, and such acceleration shall not be rescinded
or annulled, or such Debt shall not be paid in full within a period of
30 days after there has been given, by registered or certified mail,
to the Company by the Trustee or to the Company and the Trustee by the
Holders of at least 25% in aggregate principal amount of the
Outstanding Securities of that series a written notice specifying such
event of default and requiring the Company to cause such acceleration
to be rescinded or annulled or to pay in full such Debt and stating
that such notice is a "Notice of Default" hereunder; (it being
understood however, that the Trustee shall not be deemed to have
knowledge of such default under such agreement or instrument unless
either (A) a Responsible Officer of the Trustee shall have actual
knowledge of such default or (B) a Responsible Officer of the Trustee
shall have received written notice thereof from the Company, from any
Holder, from the holder of any such indebtedness or from the trustee
under any such agreement or other instrument); PROVIDED, HOWEVER, that
if such default under such agreement or instrument is remedied or
cured by the Company or waived by the holders of such indebtedness,
then the Event of Default hereunder by reason thereof shall be deemed
likewise to have been thereupon remedied, cured or waived without
further action upon the part of either the Trustee or any of such
Holders; PROVIDED, FURTHER, that the foregoing shall not apply to any
secured Debt under which the obligee has recourse (exclusive of
recourse for ancillary matters such as environmental indemnities,
misapplication of funds, costs of enforcement and the like) only to
the collateral pledged for repayment so long as the fair market value
of such collateral does not exceed 2% of Total Assets at the time of
the default;
(5) the Company, pursuant to or within the meaning of any
Bankruptcy Law, (A) commences a voluntary case or proceeding, (B)
consents to the entry of an order for relief against it in an
involuntary case or proceeding, (C) consents to the appointment of a
Custodian of it or for all or substantially all of its property, (D)
makes a general assignment for the benefit of its creditors, (E) makes
an admission in writing of its inability to pay its debts generally as
they become due or (F) takes corporate action in furtherance of any
such action;
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(6) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that (A) is for relief against the Company,
in an involuntary case, (B) adjudges the Company as bankrupt or
insolvent, or approves as properly filed a petition seeking
reorganization, arrangement, and adjustment or composition of or in
respect of the Company, or appoints a Custodian of the Company, or for
all or substantially all of its property, or (C) orders the
liquidation of the Company and the decree remains unstayed and in
effect for 60 days; or
(7) any other Event of Default provided as contemplated by
Section 3.01 with respect to Securities of that series.
The Company shall deliver to the Trustee, within 90 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any event which is or with the giving of notice or the lapse of time would
become an event which is or with the giving of notice or the lapse of time would
become an Event of Default, its status and what action the Company is taking or
proposes to take with respect thereto.
As used in the Indenture, the term "Bankruptcy Law" means Title 11,
U.S. Code, or any similar federal or state bankruptcy, insolvency,
reorganization or other law for the relief of debtors. As used in the
Indenture, the term "Custodian" means any receiver, trustee, assignee,
liquidator or similar official under any Bankruptcy Law.
Section 5.02. ACCELERATION; RESCISSION AND ANNULMENT. If an Event of
Default with respect to the Securities of any series at the time Outstanding
occurs and is continuing, the Trustee or the Holders of at least 25% in
aggregate principal amount of all of the Outstanding Securities of that series
by written notice to the Company (and if given by the Holders, to the Trustee),
may declare the principal (or, if the Securities of that series are Original
Issue Discount Securities or Indexed Securities, such portion of the Original
principal amount as may be specified in the terms of that series) of and accrued
interest, if any, on all the Securities of that series to be due and payable and
upon any such declaration such principal (or, in the case of Original Issue
Discount Securities or Indexed Securities, such specified amount) and interest,
if any, shall be immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgement or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in aggregate principal amount of the
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Outstanding Securities of that series, by written notice to the Trustee, may
rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) in the currency or currency unit in which that series of
Securities is payable, all overdue interest on all Securities of that
series and any related coupons and any Additional Amounts,
(B) in the currency or currency unit in which that series of
Securities is payable, the principal of (and premium, if any, on) any
Securities of that series which have become due otherwise than by such
declaration of acceleration and any interest thereon at the rate or
rates prescribed therefor in such Securities,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates prescribed
therefor in such Securities and any Additional Amounts payable, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all existing Defaults and Events of Default with respect to
Securities of that series, other than the non-payment of the principal of
Securities of that series which have become due solely by such declaration
of acceleration, have been cured or waived as provided in Section 5.07. No
such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 5.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT
BY TRUSTEE. The Company covenants that if
(1) default is made in the payment of any interest on any
Security or coupon, if any, when such interest or any Additional
Amounts becomes due and payable and such default continues for a
period of 30 days, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof,
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the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities and coupons, if any, the whole amount then due and
payable on such Securities and coupons for principal, premium, if any, and
interest and any Additional Amounts, and, to the extent that payment of such
interest shall be legally enforceable, interest on any overdue principal,
premium, if any, and on any overdue interest and any Additional Amounts, at the
rate or rates prescribed therefor in such Securities or coupons, if any, and, in
addition thereto, such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs
and is continuing, the Trustee may in its discretion proceed to protect and
enforce its rights and the rights of the Holders of Securities of such series by
such appropriate judicial proceedings as the Trustee shall deem most effectual
to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to secure any other proper remedy.
Section 5.04. TRUSTEE MAY FILE PROOFS OF CLAIM. The Trustee may file
such proofs of claim and other papers or documents and take such actions
authorized under the Trust Indenture Act as may be necessary or advisable in
order to have the claims of the Trustee and the Holders of Securities allowed in
any judicial proceedings relating to the Company, its creditors or its property.
In particular, the Trustee shall be authorized to collect and receive any moneys
or other property payable or deliverable on any such claims and to distribute
the same; and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 6.09.
No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder of
a Security or coupon any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof or to
authorize the Trustee to vote in respect of the claim of any Holder of a
Security or coupon in any such proceeding; PROVIDED, HOWEVER, that the Trustee
may, on behalf of the Holders, vote for
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the election of a trustee in bankruptcy or similar official and be a member of a
creditors' or other similar committee.
Section 5.05. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
SECURITIES. All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee, in its own name as an
express trust, without the possession of any of the Securities or coupons or the
production thereof in any proceeding relating thereto and any recovery of
judgment shall, after provision for the reasonable fees and expenses of the
Trustee and its counsel, be for the ratable benefit of the Holders of the
Securities and coupons in respect to which judgment was recovered.
Section 5.06. DELAY OR OMISSION NOT WAIVER. No delay or omission by
the Trustee or any Holder of any Securities to exercise any right or remedy
accruing upon an Event of Default shall impair any such right or remedy or
constitute a waiver of or acquiescence in any such Event of Default. Every
right and remedy given by this Article or by law to the Trustee or to the
Holders of Securities or coupons may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders of Securities
or coupons, as the case may be.
Section 5.07. WAIVER OF PAST DEFAULTS. The Holders of a majority in
aggregate principal amount of Outstanding Securities of any series by written
notice to the Trustee may waive on behalf of the Holders of all Securities of
such series and any related coupons a past Default or Event of Default with
respect to that series and its consequences except (i) a Default or Event of
Default in the payment of the principal of, premium, if any, or interest or any
Additional Amounts on any Security of such series or any coupon appertaining
thereto or (ii) in respect of a covenant or provision hereof which pursuant to
Section 8.02 cannot be amended or modified without the consent of the Holder of
each Outstanding Security of such series affected. Upon any such waiver, such
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured, for every purpose of this Indenture.
Section 5.08. CONTROL BY MAJORITY. The Holders of a majority in
aggregate principal amount of the Outstanding Securities of each series affected
(with each such series voting as a class) shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on it with respect to
Securities of that series; PROVIDED, HOWEVER, that (i) the Trustee may refuse to
follow any direction that conflicts with law or this Indenture (ii) the Trustee
may refuse to follow any direction that is unduly prejudicial to the rights of
the Holders of Securities of such series not consenting or of any other series
for which the Trustee is trustee, or that would in
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the good faith judgment of the Trustee have a substantial likelihood of
involving the Trustee in personal liability and (iii) the Trustee may take any
other action deemed proper by the Trustee which is not inconsistent with such
direction. Prior to the taking of any action hereunder, the Trustee shall be
entitled to reasonable indemnification satisfactory to the Trustee against all
losses and expenses caused by taking or not taking such action. This paragraph
shall be in lieu of Section 316(a)(1)(A) of the Trust Indenture Act and such
Section 316(a)(1)(A) is hereby expressly excluded from this Indenture, as
permitted By the Trust Indenture Act.
Section 5.09. LIMITATION ON SUITS BY HOLDERS. No Holder of any
Security of any series or any coupons appertaining thereto shall have any right
to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(1) the Holder has previously given written notice to the Trustee
of a continuing Event of Default with respect to the Securities of
that series;
(2) the Holders of at least 25% in aggregate principal amount of
the Outstanding Securities of that series have made a written request
to the Trustee to institute proceedings in respect of such Event of
Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense to
be, or which may be, incurred by the Trustee in pursuing the remedy;
(4) the Trustee for 60 days after its receipt of such notice,
request and the offer of indemnity has failed to institute any such
proceedings; and
(5) during such 60 day period, the Holders of a majority in
aggregate principal amount of the Outstanding Securities of that
series have not given to the Trustee a direction inconsistent with
such written request.
No one or more Holders shall have any right in any manner whatever by
virtue of, or by availing of any provision of this Indenture to affect, disturb
or prejudice the rights of any other of such Holders, or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce any
right under this Indenture, except in the manner herein provided and for the
equal and ratable benefit of all of such Holders.
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Section 5.10. RIGHTS OF HOLDERS TO RECEIVE PAYMENT. Notwithstanding
any other provision of this Indenture, the right of any Holder of a Security or
coupon to receive payment of principal of, premium, if any, and, subject to
Sections 3.05 and 3.07, interest on the Security and any Additional Amounts, on
or after the respective due dates expressed in the Security (or, in case of
redemption, on the redemption dates), and the right of any Holder of a coupon to
receive payment of interest due as provided in such coupon, or, subject to
Section 5.09, to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent of
such Holder.
Section 5.11. APPLICATION OF MONEY COLLECTED. If the Trustee
collects any money pursuant to this Article, it shall pay out the money in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money on account of principal, premium, if any, or
interest, and any Additional Amounts upon presentation of the Securities or
coupon or both and the notation thereon of the payment if only partially paid
and upon surrender thereof if fully paid:
FIRST: to the Trustee for amounts due under Section 6.09;
SECOND: subject to the provisions of Article XII, to Holders of
Securities and coupons in respect of which or for the benefit of which such
money has been collected for amounts due and unpaid on such Securities for
principal of, premium, if any, and interest or any Additional Amounts,
ratably, without preference or priority of any kind, according to the
amounts due and payable on such Securities for principal, premium, if any,
and interest, respectively; and
THIRD: to the Company.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 5.11. At least 15 days before such record
date, the Trustee shall mail to each Holder and the Company a notice that states
the record date, the payment date and the amount to be paid.
Section 5.12. RESTORATION OF RIGHTS AND REMEDIES. If the Trustee or
any Holder of a Security or coupon has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to such Holder, then and in every such case, subject to any determination in
such proceeding, the Company, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies
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of the Trustee and the Holders of Securities and coupons shall continue as
though no such proceeding had been instituted.
Section 5.13. RIGHTS AND REMEDIES CUMULATIVE. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities or coupons in the last paragraph of Section 3.06, no
right or remedy herein conferred upon or reserved to the Trustee or the Holders
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any existing right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 5.14. WAIVER OF USURY, STAY OR EXTENSION LAWS. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any usury, stay or extension law wherever enacted, now
or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
Section 5.15. UNDERTAKING FOR COSTS. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorney's fees, against any party litigant in the
suit having due regard to the merits and good faith of the claims or defenses
made by the party litigant PROVIDED that neither this Section nor the Trust
Indenture Act shall be deemed to authorize any court to require such an
undertaking or to make such an assessment in any suit instituted by the Company
or by the Trustee.
Section 5.16. JUDGMENT CURRENCY. If, for the purpose of obtaining a
judgment in any court with respect to any obligation of the Company hereunder or
under any Security or any related coupon, it shall become necessary to convert
into any other currency or currency unit any amount in the currency or currency
unit due hereunder or under such Security or coupon, then such conversion shall
be made by the Exchange Rate Agent at the Market Exchange Rate as in effect on
the date of entry of the judgment (the "Judgment Date"). If pursuant to any
such
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judgment, conversion shall be made on a date (the "Substitute Date") other than
the Judgment Date and there shall occur a change between the Market Exchange
Rate as in effect on the Judgment Date and the Market Exchange Rate as in effect
on the Substitute Date, the Company agrees to pay such additional amounts (if
any) as may be necessary to ensure that the amount paid is equal to the amount
in such other currency or currency unit which, when converted at the Market
Exchange Rate as in effect on the Judgment Date, is the amount due hereunder or
under such Security or coupon. Any amount due from the Company, under this
Section 5.16 shall be due as a separate debt and is not to be affected by or
merged into any judgment being obtained for any other sums due hereunder or in
respect of any Security or coupon. In no event, however, shall the Company be
required to pay more in the currency or currency unit due hereunder under such
Security or coupon at the Market Exchange Rate as in effect on the Judgment Date
than the amount of currency or currency unit stated to be due hereunder or under
such Security or coupon so that in any event the Company's obligations hereunder
or under such Security or coupon will be effectively maintained as obligations
in such currency or currency unit, and the Company shall be entitled to withhold
(or be reimbursed for, as the case may be) any excess of the amount actually
realized upon any such conversion on the Substitute Date over the amount due and
payable on the Judgment Date.
ARTICLE VI
The Trustee
Section 6.01. CERTAIN DUTIES AND RESPONSIBILITIES OF THE TRUSTEE.
(a) The Trustee's duties and responsibilities under this Indenture shall be
governed by the Trust Indenture Act.
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise the rights and powers vested in it by this Indenture and
shall use the same degree of care and skill in their exercise, as a prudent man
would exercise or use under the circumstances in the conduct of his own affairs.
Section 6.02. RIGHTS OF TRUSTEE. Subject to the provisions of the
Trust Indenture Act:
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any document believed by it to be genuine and to
have been signed or presented by the proper party or parties. The Trustee need
not investigate any fact or matter stated in the document.
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(b) Any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order (other than
delivery of any Security, together with any coupons appertaining thereto, to the
Trustee for authentication and delivery pursuant to Section 3.03 which shall be
sufficiently evidenced as provided therein) and any resolution of the Board of
Directors may be sufficiently evidenced by a Board Resolution.
(c) Before the Trustee acts or refrains from acting, it may consult
with counsel of its selection and/or require an Officers' Certificate. The
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on a Board Resolution, the written or oral advice of counsel
reasonably acceptable to the Company and the Trustee (which advice, if oral,
counsel shall promptly confirm in writing to the Trustee), a certificate of an
Officer or Officers delivered pursuant to Section 1.02, an Officers' Certificate
or an Opinion of Counsel.
(d) The Trustee may act through agents or attorneys and shall not be
responsible for the misconduct or negligence of any agent or attorney appointed
with due care.
(e) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers.
(f) The Trustee shall not be required to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its
duties hereunder, or in the exercise of its rights or powers if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may seem fit, and, if the Trustee shall determine to
make such further inquiry or investigation it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney.
(h) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against
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the costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction.
(i) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section 6.02.
Section 6.03. TRUSTEE MAY HOLD SECURITIES. The Trustee, any Paying
Agent, any Registrar or any other agent of the Company, in its in individual or
any other capacity, may become the owner or pledgee of Securities and coupons
and, subject to Sections 310(b) and 311 of the Trust Indenture Act, may
otherwise deal with the Company, an Affiliate or Subsidiary with the same rights
it would have if it were not Trustee, Paying Agent, Registrar or such other
agent.
Section 6.04. MONEY HELD IN TRUST. Money held by the Trustee in
trust hereunder need not be segregated from other funds except to the extent
required by law. The Trustee shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed upon in writing with
the Company.
Section 6.05. TRUSTEE'S DISCLAIMER. The recitals contained herein
and in the Securities, except the Trustee's certificate of authentication, shall
be taken as the statements of the Company, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representation as to
the validity or accuracy of this Indenture or the Securities or any coupon. The
Trustee shall not be accountable for the Company's use of the proceeds from the
Securities or for monies paid over to the Company pursuant to the Indenture.
Section 6.06. NOTICE OF DEFAULTS. If a Default occurs and is
continuing with respect to the Securities of any series and if it is known to a
Responsible Officer of the Trustee, the Trustee shall, within 90 days after it
occurs, transmit by mail to the Holders of Securities of such series, in the
manner and to the extent provided in Section 313(c) of the Trust Indenture Act,
notice of all Defaults known to it unless such Default shall have been cured or
waived; PROVIDED, HOWEVER, that except in the case of a Default in payment on
the Securities of any series, the Trustee may withhold the notice if and so long
as the board of directors, the executive committee or a committee of its
Responsible Officers in good faith determines that withholding such notice is in
the interests of Holders of Securities of that series; and PROVIDED, FURTHER,
that in the case of any Default of the character specified in Section 5.01(3)
with respect to Securities of such series, no such notice to Holders shall be
given until at least 30 days after the occurrence thereof.
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Section 6.07. REPORTS BY TRUSTEE TO HOLDERS. Within 60 days after
each May 15 of each year commencing with the first May 15 after the first
issuance of Securities pursuant to this Indenture, the Trustee shall transmit by
mail to all Holders of Securities as provided in Section 313(c) of the Trust
Indenture Act a brief report dated as of such May 15 if required by and in
compliance with Section 313(a) of the Trust Indenture Act. A copy of each such
report shall, at the time of such transmission to Holders, be filed by the
Trustee with each stock exchange, if any, upon which the Securities are listed,
with the Commission and with the Company. The Company will promptly notify the
Trustee when the Securities are listed on any stock exchange.
Section 6.08. SECURITYHOLDER LISTS. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Holders of Securities of each series. If the
Trustee is not the Registrar, the Company shall furnish to the Trustee
semiannually on or before the last day of June and December in each year, and at
such other times as the Trustee may request in writing, a list, in such form and
as of such date as the Trustee may reasonably require containing all the
information in the possession or control of the Registrar, the Company or any of
its Paying Agents other than the Trustee as to the names and addresses of
Holders of Securities of each such series. If there are Bearer Securities of
any series Outstanding, even if the Trustee is the Registrar, the Company shall
furnish to the Trustee such a list containing such information with respect to
Holders of such Bearer Securities only.
Section 6.09. COMPENSATION AND INDEMNITY. (a) The Company shall pay
to the Trustee from time to time such reasonable compensation for its services
as the Company and the Trustee shall agree in writing from time to time. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses incurred by it in connection
with the performance of its duties under this Indenture, except any such expense
as may be attributable to its negligence or bad faith. Such expenses shall
include the reasonable compensation and expenses of the Trustee's agents and
counsel.
(b) The Company shall indemnify the Trustee and any Predecessor
Trustee, for and hold it harmless against, any loss or liability damage, claim
or reasonable expense including taxes (other than taxes based upon or determined
or measured by the income of the Trustee) incurred by it arising out of or in
connection with its acceptance or administration of the trust or trusts
hereunder, including the reasonable costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of
any of its powers or duties
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hereunder. The Trustee shall notify the Company promptly of any claim for which
it may seek indemnity. The Company shall defend the claim and the Trustee shall
cooperate in the defense. The Trustee may have separate counsel and the Company
shall pay the reasonable fees and expenses of such counsel. The Company need
not pay for any settlement made without its consent, which consent shall not be
unreasonably withheld.
(c) The Company need not reimburse any expense or indemnify against
any loss or liability incurred by the Trustee through negligence or bad faith.
(d) To secure the payment obligations of the Company pursuant to this
Section, the Trustee shall have a lien prior to the Securities of any series on
all money or property held or collected by the Trustee, except that held in
trust to pay principal, premium, if any, any interest and any Additional
Amounts, on particular Securities.
When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 5.01(5) or Section 5.01(6), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
The provisions of this Section shall survive the termination of this
Indenture or the resignation or removal of the Trustee.
Section 6.10. REPLACEMENT OF TRUSTEE. (a) The resignation or removal
of the Trustee and the appointment of a successor Trustee shall become effective
only upon the successor Trustee's acceptance of appointment as provided in
Section 6.11.
(b) The Trustee may resign at any time with respect to the Securities
of any series by giving written notice thereof to the Company.
(c) The Holders of a majority in aggregate principal amount of the
Outstanding Securities of any series may remove the Trustee with respect to that
series by so notifying the Trustee and the Company and may appoint a successor
Trustee for such series with the Company's consent.
(d) If at any time:
(1) the Trustee fails to comply with Section 310(b) of the Trust
Indenture Act after written request therefor by the Company or by any
Holder who has been a bona fide Holder of a Security for any least six
months, or
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(2) the Trustee shall cease to be eligible under Section 6.12 of
this Indenture or Section 310(a) of the Trust Indenture Act and shall fail
to resign after written request therefor by the Company or by any Holder of
a Security who has been a bona fide Holder of a Security for at least six
months; or
(3) the Trustee becomes incapable of acting, is adjudged a
bankrupt or an insolvent or a receiver or public officer takes charge of
the Trustee or its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then, in any such case, (i) the Company by or
pursuant to a Board Resolution may remove the Trustee with respect to all
Securities, or (ii) subject to Section 315(e) of the Trust Indenture Act,
any Holder who has been a bona fide Holder of a Security for at least six
months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Trustee
with respect to all Securities and the appointment of a successor Trustee
or Trustees.
(e) If the instrument of acceptance by a successor Trustee required by
Section 6.11 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation or removal, the Trustee resigning or
being removed may petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
(f) If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, with respect to Securities of one or more
series, the Company, by or pursuant to Board Resolution, shall promptly appoint
a successor Trustee with respect to the Securities to that or those series (it
being understood that any such successor Trustee may be appointed with respect
to the Securities of one or more or all of such series and that at any time
there shall be only one Trustee with respect to the Securities of any particular
series) and shall comply with the applicable requirements of Section 6.11. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee with respect to the Securities
of any series shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Securities of such series delivered to the
Company and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 6.11, become the successor Trustee with
respect to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee with
respect to the Securities of any series shall have
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been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 6.11, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
Section 6.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. (a) In case of
the appointment hereunder of a successor Trustee with respect to all Securities,
every such successor Trustee shall execute, acknowledge and deliver to the
Company and to the retiring Trustee an instrument accepting such appointment.
Thereupon, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee, without further act, deed or conveyance,
shall become vested with all the rights, powers and duties of the retiring
Trustee; but, on the request of the Company or the successor Trustee, such
retiring Trustee shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Trustee all the rights, powers and
trusts of the retiring Trustee and shall duly assign, transfer and deliver to
such successor Trustee all property and money held by such retiring Trustee
hereunder.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and such successor Trustee shall execute and deliver an
indenture supplemental hereto wherein such successor Trustee shall accept such
appointment and which (i) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, such successor Trustee all
the rights, powers, trusts and duties of the retiring Trustee with respect to
the Securities of that or those series to which the appointment of such
successor Trustee relates, (ii) if the retiring Trustee is not retiring with
respect to all Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
or the retiring Trustee with respect to the Securities of that or those series
as to which the retiring Trustee is not retiring shall continue to be vested in
the retiring Trustee, and (iii) shall add to or change any of the provisions of
this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by another such Trustee and upon the
execution and delivery of such supplemental indenture the resignation or removal
of the retiring Trustee shall become effective to the extent provided therein
and each such successor Trustee, without any further act, deed or
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conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to the successor Trustee all such rights, powers and trusts referred
to in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under the Trust Indenture Act.
(e) The Company shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series in the
manner provided for notices to the Holders of Securities in Section 1.06. Each
notice shall include the name of the successor Trustee with respect to the
Securities of such series and the address of its Corporate Trust Office.
Section 6.12. ELIGIBILITY; DISQUALIFICATION. There shall at all
times be a Trustee hereunder which shall be eligible to act as Trustee under
Section 310(a)(1) of the Trust Indenture Act and shall have a combined capital
and surplus of at least $100,000,000. If such Trustee publishes reports of
condition at least annually, pursuant to law or the requirements of Federal,
State, Territorial or District of Columbia supervising or examining authority,
then, for the purposes of this Section, the combined capital and surplus of such
Trustee shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect heretofore specified
in this Article.
Section 6.13. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS. Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor to the Trustee hereunder, provided such
corporation shall be otherwise
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qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto. In case
any Securities shall have been authenticated, but not delivered, by the Trustee
then in office, any successor by merger, conversion or consolidation to such
authenticating Trustee may adopt such authentication and deliver the Securities
so authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities.
Section 6.14. APPOINTMENT OF AUTHENTICATING AGENT. The Trustee may
appoint an Authenticating Agent or Agents with respect to one or more series of
Securities which shall be authorized to act on behalf of the Trustee to
authenticate Securities of such series issued upon original issue, exchange,
registration of transfer or partial redemption thereof, and Securities so
authenticated shall be entitled to the benefits of this Indenture and shall be
valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Any such appointment shall be evidenced by an instrument in writing
signed by a Responsible Officer of the Trustee, a copy of which Instrument shall
be promptly furnished to the Company. Wherever reference is made in this
Indenture to the authentication and delivery of Securities by the Trustee or the
Trustee's certificate of authentication, such reference shall be deemed to
include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and, except as may otherwise be provided pursuant to
Section 3.01, shall at all times be a bank or trust company or corporation
organized and doing business and in good standing under the laws of the United
States of America or of any State or the District of Columbia, authorized under
such laws to act as Authenticating Agent, having a combined capital and surplus
of not less than $50,000,000 and subject to supervision or examination by
Federal or State authorities. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Authenticating Agent shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. In case at any time an Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section,
such Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
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corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or further act
on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent for any series of Securities may at any time
resign by giving written notice of resignation to the Trustee for such series
and to the Company. The Trustee for any series of Securities may at any time
terminate the agency of an Authenticating Agent by giving written notice of
termination to such Authenticating Agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
such Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee for such series may appoint a successor
Authenticating Agent which shall be acceptable to the Company and shall give
notice of such appointment to all Holders of Securities of the series with
respect to which such Authenticating Agent will serve in the manner set forth in
Section 1.06. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers and duties
of its predecessor hereunder, with like effect as if originally named as an
Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section.
The Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation including reimbursement of its reasonable expenses
for its services under this Section.
If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to or in lieu of the Trustee's certificate of authentication, an
alternate certificate of authentication substantially in the following form:
This is one of the Securities of the series described in the
within-mentioned Indenture.
-------------------------------,
as Trustee
By:
------------------------------
as Authenticating Agent
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By:
------------------------------
Authorized Signatory
ARTICLE VII
Consolidation, Merger or Sale by the Company
Section 7.01. CONSOLIDATION, MERGER OR SALE OF ASSETS PERMITTED. The
Company shall not consolidate with or merge with or into, or transfer or lease
all or substantially all of its assets to, any Person unless:
(1) the Person formed by or surviving any such consolidation or
any merger (if other than the Company), or to which such transfer or lease
shall have been made, is a corporation organized and existing under the
laws of the United States, any State thereof or the District of Columbia;
(2) the Person formed by or surviving any such consolidation or
merger (if other than the Company), or to which such transfer or lease
shall have been made, expressly assumes by supplemental indenture hereto
executed and delivered to the Trustee, inform satisfactory to the Trustee,
the due and punctual payment of the principal, premium, if any, interest,
if any and any Additional Amounts, with respect to all of the Securities
and the performance or observance of every covenant under this Indenture
and the Securities on the part of the Company to be performed under the
Securities, the coupons and this Indenture;
(3) immediately after giving effect to the transaction and
treating any indebtedness which becomes an obligation of the Company or a
Subsidiary of the Company as a result of such transaction as having been
incurred by the Company or such Subsidiary at the time of such transaction
no Default or Event of Default exists and is continuing; and
(4) if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, properties or assets of the Company would
become subject to a mortgage, pledge, lien, security interest or other
encumbrance which would not be permitted by the Securities of any series,
the Company or such successor Person, as the case may be, shall take such
steps as shall be necessary effectively to secure such Securities equally
and ratably with all indebtedness secured thereby.
The Company shall deliver to the Trustee prior to the proposed
transaction an Officers' Certificate to the foregoing
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effect and an Opinion of Counsel stating that the proposed transaction and such
supplemental indenture comply with this Indenture and that all conditions
precedent to the consummation of the transaction under this Indenture have been
met.
In the event of the assumption by a successor corporation as provided
in clause (2) above, such successor corporation shall succeed to and be
substituted for the Company hereunder and under the Securities with the same
effect as if it had been named hereunder and thereunder and, except in the case
of a lease, any coupons appertaining thereto and all such obligations of the
Company shall terminate.
ARTICLE VIII
Supplemental Indentures
Section 8.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company, when authorized by a Board
Resolution, and the Trustee at any time and from time to time, may enter into
indentures supplemental hereto, in form reasonably satisfactory to the Trustee,
for any of the following purposes:
(1) to evidence the succession of another corporation to the
Company and the assumption by any such successor of the covenants and
obligations of the Company herein and in the Securities; or
(2) to add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities (and if such covenants are
to be for the benefit less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred upon the
Company; or
(3) to add any additional Events of Default with respect to all
or any series of Securities (and if such Events of Default are to be for
the benefit of less than all series of Securities, stating that such Events
of Default are expressly included solely for the benefit of such series);
or
(4) to add to or change any of the provisions of this Indenture
to such extent as shall be necessary to facilitate the issuance of Bearer
Securities (including, without limitation to provide that Bearer Securities
may be registrable as to principal only) or to facilitate the issuance of
Securities in global form; or
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(5) to change or eliminate any of the provisions of this
Indenture, provided that any such change or elimination shall become
effective only when there is no Security Outstanding of any series created
prior to the execution of such supplemental indenture which is entitled to
the benefit of such provision; or
(6) to establish the form or terms of Securities of any series
as permitted by Sections 2.01 and 3.01; or
(7) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 6.11; or
(8) if allowed without penalty under applicable laws and
regulations, to permit payment in the United states (including any of the
States and District of Columbia), its territories, its possessions and
other areas subject to its jurisdiction of principal, premium, if any, or
interest, if any, on Bearer Securities or coupons, if any; or
(9) to correct or supplement any provision herein which may be
inconsistent with any other provision herein or to make any other
provisions with respect to matters or questions arising under this
Indenture, provided such action shall not adversely affect the interests of
the Holders of Securities of any series; or
(10) to cure an ambiguity or correct any mistake, provided such
action shall not adversely affect the interests of the Holders of
Securities of any series.
Section 8.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS. With
the written consent of the Holders of a majority of the aggregate principal
amount of the Outstanding Securities of each series adversely affected by such
supplemental indenture (with the Securities of each series voting as a class),
the Company, when authorized by a Board Resolution, and the Trustee may enter
into an indenture or indentures supplemental hereto to add any provisions to or
to change or eliminate any provisions of this Indenture or of any other
indenture supplemental hereto or to modify the rights of the Holders of such
Securities; PROVIDED, HOWEVER, that without the consent of the Holder of each
Outstanding Security affected thereby, a supplemental indenture under this
Section may not:
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(1) change the Stated Maturity of the principal of, or premium,
if any, on, or any installment of principal of or premium, if any, or
interest on, or any Additional Amounts on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or any premium
payable upon the redemption, repurchase or repayment thereof, or change the
manner in which the amount of any principal thereof or premium, if any, or
interest or Additional Amounts thereon is determined or reduce the amount
of the principal of any Original Issue Discount Security or Indexed
Security that would be due and payable upon a declaration of acceleration
of the Maturity thereof pursuant to Section 5.02, or change the Place of
Payment where or the currency in which any Securities or any premium or the
interest or Additional Amounts thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date);
(2) reduce the percentage in principal amount of the Outstanding
Securities affected thereby, the consent of whose Holders is required for
any such supplemental indenture, or the consent of whose Holders is
required for any waiver (of compliance with certain provisions of this
Indenture or certain defaults hereunder and their consequences) provided
for in this Indenture;
(3) change any obligation of the Company to maintain an office
or agency in the places and for the purposes specified in Section 9.02; or
(4) make any change in Section 5.07 or this 8.02 except to
increase any percentage or to provide that certain other provisions of this
Indenture cannot be modified or waived with the consent of the Holders of
each Outstanding Security affected thereby.
A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture which has expressly been included solely for
the benefit of one or more particular series of Securities, or which modifies
the rights of the Holders of Securities of such series with respect to such
covenant or other provision shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It is not necessary under this Section 8.02 for the Holders to consent
to the particular form of any proposed supplemental indenture, but it is
sufficient if they consent to the substance thereof.
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Section 8.03. COMPLIANCE WITH TRUST INDENTURE ACT. Every amendment
to this Indenture or the Securities of one or more series shall be set forth in
a supplemental indenture that complies with the Trust Indenture Act as then in
effect.
Section 8.04. EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article or the modification thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture. The
Trustee may, but shall not be obligated to, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
Section 8.05. EFFECT OF SUPPLEMENTAL INDENTURES. Upon the execution
of any supplemental indenture under this Article, this Indenture shall be
modified in accordance therewith and such supplemental indenture shall form a
part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder and of any
coupon appertaining thereto shall be bound thereby.
Section 8.06. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.
Securities, including any coupons, of any series authenticated and delivered
after the execution of any supplemental indenture pursuant to this Article may,
and shall if required by the Trustee, bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Securities including any coupons of any series
so modified as to conform, in the opinion of the Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities including any coupons of such series.
Section 8.07. EFFECT ON SENIOR INDEBTEDNESS. No supplemental
indenture shall adversely affect the rights of any holder of Senior Indebtedness
under Article XII without the consent of such holder.
ARTICLE IX
Covenants
Section 9.01. PAYMENT OF PRINCIPAL, PREMIUM, IF ANY, AND INTEREST.
The Company covenants and agrees for the benefit of the Holders of each series
of Securities that it will duly and punctually pay the principal of, premium, if
any, and interest
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together with Additional Amounts, if any, on the Securities of that series in
accordance with the terms of the Securities of such series, any coupons
appertaining thereto and this Indenture. An installment of principal, premium,
if any, or interest, if any, of any Additional Amounts shall be considered paid
on the date it is due if the Trustee or Paying Agent holds on that date money
designated for and sufficient to pay the installment.
Section 9.02. MAINTENANCE OF OFFICE OR AGENCY. If Securities of a
series are issued as Registered Securities, the Company will maintain in each
Place of Payment for any series of Securities an office or agency where
Securities of that series may be presented or surrendered for payment, where
securities of that series may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company in respect of the
Securities of that series and this Indenture may be served. If Securities of a
series are issuable as Bearer Securities, the Company will maintain, (i) subject
to any laws or regulations applicable thereto, an office or agency in a Place of
Payment for that series which is located outside the United States where
Securities of that series and related coupons may be presented and surrendered
for payment; PROVIDED, HOWEVER, that if the Securities of that series are listed
on The International Stock Exchange of the United Kingdom and the Republic of
Ireland Limited, the Luxembourg Stock Exchange or any other stock exchange
located outside the United States and such stock exchange shall so require, the
Company will maintain a Paying Agent for the Securities of that series in
London, Luxembourg or any other required city located outside the United States,
as the case may be, so long as the Securities of that series are listed on such
exchange, and (ii) subject to any laws or regulations applicable thereto, an
office or agency in a Place by Payment for that series which is located outside
the United States, where Securities of that series may be surrendered for
exchange and where notices and demands to or upon the Company in respect of the
Securities of that series and this Indenture maybe served. The Company will
give prompt written notice to the Trustee of the location, and any change in the
location, of any such office or agency. If at any time the Company shall fail
to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee, and
the Company hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
Unless otherwise specified as contemplated by Section 3.01, no payment
of principal, premium or interest on Bearer Securities shall be made at any
office or agency of the Company in the United States, by check mailed to any
address in United States, by transfer to an account located in the United States
or upon presentation or surrender in the United States of a Bearer
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Security or coupon for payment, even if the payment would be credited to an
account located outside the United States; PROVIDED, HOWEVER, that, if the
Securities of a series are denominated and payable in Dollars, payment of
principal of and any premium or interest on any such Bearer Security shall be
made at the office of the Company's Paying Agent located within the United
States, if (but only if) payment in Dollars of the full amount of such
principal, premium or interest, as the case may be, at all offices or agencies
outside the United States maintained for the purpose by the Company in
accordance with this Indenture is illegal or effectively precluded by exchange
controls or other similar restrictions.
The Company may also from time to time designate one or more other
offices or agencies where the Securities (including any coupons, if any) of one
or more series may be presented or surrendered for any or all such purposes and
may from time to time rescind such designations; PROVIDED, HOWEVER, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or an agency in each Place of Payment for
Securities (including any coupons, if any) of any series for such purposes. The
Company will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency. Unless otherwise specified as contemplated by Section 3.01, the Trustee
shall initially serve as Paying Agent.
If and so long as the Securities of any series (i) are denominated in
a currency other than Dollars or (ii) may be payable in currency other than
Dollars, or so long as it is required under any other provision of this
Indenture, then the Company will maintain with respect to each such series of
Securities or as so required, an Exchange Rate Agent.
Section 9.03. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST;
UNCLAIMED MONEY. If the Company shall at any time act as its own Paying Agent
with respect to any series of Securities, it will, on or before each due date of
the principal of, premium, if any, or interest or any Additional Amount, on any
of the Securities of that series, segregate and hold in trust for the benefit of
the Persons entitled thereto a sum sufficient to pay the principal, premium, if
any, or interest so becoming due until such sums shall be paid to such Persons
or otherwise disposed of as herein provided and will promptly notify the Trustee
in writing of its action or failure so to act.
The Company will cause each Paying Agent for any series of Securities
other than the Trustee to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to the provisions
of this Section, that such Paying Agent will:
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(1) hold all sums held by it for the payment of the principal of,
premium, if any, or interest or Additional Amounts on Securities of that
series in trust for the benefit of the Persons entitled thereto until such
sums shall be paid to such Persons or otherwise disposed of as herein
provided;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities of that series) in the making to any
payment of principal, premium, if any, or interest or Additional Amounts on
the Securities; and
(3) at any time during the continuance of any such default, upon
the written request of the Trustee, forthwith pay to the Trustee all sums
so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge or defeasance of this Indenture or for any other
purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee
all sums held in trust by the Company or such Paying Agent, such sums to be held
by the Trustee upon the same terms as those upon which such sums were held by
the Company or such Paying Agent; and, upon such payment by any Paying Agent to
the Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of any principal, premium or interest
on any Security of any series and remaining unclaimed for two years after such
principal, premium, if any, or interest or Additional Amount has become due and
payable shall be paid to the Company on Company Request or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
and coupon, if any, shall thereafter, as an unsecured general creditor, look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; PROVIDED, HOWEVER, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in a newspaper
published in the English language, customarily published on each Business Day
and of general circulation in The City of New York, or cause to be mailed to
such Holder, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid
to the Company.
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Section 9.04. CORPORATE EXISTENCE. Subject to Article VII, the
Company will at all times do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence and its
rights and franchises; PROVIDED that nothing in this Section 9.04 shall prevent
the abandonment or termination of any right or franchise of the Company if, in
the opinion of the Company, such abandonment or termination is in the best
interests of the Company and not prejudicial in any material respect to the
Holders of the Securities.
Section 9.05. REPORTS BY THE COMPANY. The Company covenants:
(a) to file with the Trustee, within 30 days after the Company is
required to file the same with the Commission, copies of the annual reports and
of the information, documents and other reports (or copies of such portions of
any of the foregoing as the Commission may from time to time by rules and
regulations prescribe) which the Company may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934, as amended; or, if the Company is not required to file information,
documents or reports pursuant to either of such Sections, then to file with the
Trustee and the Commission, in accordance with rules and regulations prescribed
from time to time by the Commission, such of the supplementary and periodic
information, documents and reports which may be required pursuant to Section 13
of the Securities Exchange Act of 1934, as amended, in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations;
(b) to file with the Trustee and the Commission, in accordance with
the rules and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance by the
Company with the conditions and covenants provided for in this Indenture as may
be required from time to time by such rules and regulations; and
(c) to transmit to all Holders of Securities, within 30 days after
the filing thereof with the Trustee, in the manner and to the extent provided in
Section 313(c) of the Trust Indenture Act, such summaries of any information,
documents and reports required to be filed by the Company pursuant to
subsections (a) and (b) of this Section 9.05, as may be required by rules and
regulations prescribed from time to time by the Commission.
Delivery of such reports, information and documents to the Trustee is for
informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information
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contained therein, including information concerning the Company's compliance
with any of its covenants hereunder, PROVIDED that the foregoing shall not
relieve the Trustee of any of its responsibilities hereunder.
Section 9.06. ANNUAL REVIEW CERTIFICATE; NOTICE OF DEFAULTS OR EVENTS
OF DEFAULT. The Company covenants and agrees to deliver to the Trustee, within
120 days after the end of each fiscal year of the Company ending after the date
hereof, a certificate from the principal executive officer, principal financial
officer or principal accounting officer of the Company, covering the preceding
calendar year, stating whether or not to the best knowledge of the signer(s)
thereof the Company is in default in the performance, observance or fulfillment
of or compliance with any of the terms, provisions, covenants and conditions of
this Indenture, and if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.
For the purposes of this Section 9.06, compliance shall be determined without
regard to any grace period or requirement of notice provided pursuant to the
terms of this Indenture.
Section 9.07. BOOKS OF RECORD AND ACCOUNT. The Company will keep
proper books of record and account, either on a consolidated or individual
basis. The Company shall cause its books of record and account to be examined
either on a consolidated or individual basis, by one or more firms of
independent public accountants not less frequently than annually. The Company
shall prepare its financial statements in accordance with GAAP.
ARTICLE X
Redemption
Section 10.01. APPLICABILITY OF ARTICLE. Securities (including
coupons, if any) of any series which are redeemable before their Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 3.01 for Securities of any series) in
accordance with this Article.
Section 10.02. ELECTION TO REDEEM NOTICE TO TRUSTEE. The election of
the Company to redeem any Securities, including coupons, if any, shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at
the election of the Company of less than all the Securities or coupons, if any,
of any series, the Company shall, at least 60 days prior to the Redemption Date
fixed by the Company (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee of such Redemption Date and Redemption Price, of
the principal amount of Securities of such series to be redeemed and, if
applicable, of the tenor of the Securities to be redeemed. In the case of any
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redemption of Securities (i) prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or elsewhere in this
Indenture or (ii) pursuant to an election of the Company which is subject to a
condition specified in the terms of such Securities, the Company shall furnish
the Trustee with an Officers' Certificate evidencing compliance with such
restriction or condition.
Section 10.03. SELECTION OF SECURITIES TO BE REDEEMED. Unless
otherwise specified as contemplated by Section 3.01, if less than all the
Securities (including coupons, if any) of a series with the same terms are to be
redeemed, the Trustee, not more than 45 days prior to the redemption date, shall
select the Securities of the series to be redeemed in such manner as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any Security of such series,
provided that the unredeemed portion of the principal amount of any Security
shall be in an authorized denomination (which shall not be less than the minimum
authorized denomination) for such Security. The Trustee shall make the
selection from Securities of the series that are Outstanding and that have not
previously been called for redemption and may provide for the selection for
redemption of portions (equal to the minimum authorized denomination for
Securities, including coupons, if any, of that series or any integral multiple
thereof) of the principal amount of Securities, including coupons, if any, of
such series of a denomination larger than the minimum authorized denomination
for Securities of that series. The Trustee shall promptly notify the Company in
writing of the Securities selected by the Trustee for redemption and, in the
case of any Securities selected for partial redemption, the principal amount
thereof to be redeemed. If the Company shall so direct, Securities registered in
the name of the Company, any Affiliate or any Subsidiary thereof shall not be
included in the Securities selected for redemption. If less than all the
Securities of any series with differing issue dates, interest rates and stated
maturities are to be redeemed, the Company in its sole discretion shall select
the particular Securities to be redeemed and shall notify the Trustee in writing
thereof at least 45 days prior to the relevant redemption date.
For purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities (including coupons, if
any) shall relate, in the case of any Securities (including coupons, if any)
redeemed or to be redeemed only in part, to the portion of the principal amount
of such Securities (including coupons, if any) which has been or is to be
redeemed.
Section 10.04. NOTICE OF REDEMPTION. Unless otherwise specified as
contemplated by Section 3.01, notice of redemption shall be given in the manner
provided in Section 1.06 not less
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than 30 days nor more than 60 days prior to the Redemption Date to the Holders
of the Securities to be redeemed.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) if less than all the Outstanding Securities of a series are
to be redeemed, the identification (and in the case of partial redemption,
the principal amounts) of the particular Security or Securities to be
redeemed;
(4) in case any Security is to be redeemed in part only, the
notice which relates to such Security shall state that on and after the
Redemption Date, upon surrender of such Security, the Holder will receive,
without a charge, a new Security or Securities of authorized denominations
for the principal amount thereof remaining unredeemed;
(5) the Place or Places of Payment where such Securities,
together in the case of Bearer Securities with all coupons appertaining
thereto, if any, maturing after the Redemption Date, are to surrendered for
payment for the Redemption Price;
(6) that Securities of the series called for redemption and all
unmatured coupons, if any, appertaining thereto must be surrendered to the
Paying Agent to collect the Redemption Price;
(7) that, on the Redemption Date, the Redemption Price will
become due and payable upon each such Security, or the portion thereof, to
be redeemed and, if applicable, that interest thereon will cease to accrue
on and after said date;
(8) that the redemption is for a sinking fund, if such is the
case;
(9) that unless otherwise specified in such notice, Bearer
Securities of any series, if any, surrendered for redemption must be
accompanied by all coupons maturing subsequent to the Redemption Date or
the amount of any such missing coupon or coupons will be deducted from the
Redemption Price, unless security or indemnity satisfactory to the Company,
the Trustee and any Paying Agent is furnished; and
(10) the CUSIP number, if any, of the Securities.
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Notice of redemption of Securities to be redeemed shall be given by
the Company or, at the Company's request, by the Trustee in the name and at the
expense of the Company.
Section 10.05. DEPOSIT OF REDEMPTION PRICE. On or prior to any
Redemption Date, the Company shall deposit with the Trustee or with a Paying
Agent (or, if the Company is acting as its own Paying Agent, which it may not
do in the case of a sinking fund payment under Article XI, segregate and hold
in trust as provided in Section 9.03) an amount of money in the currency or
currencies (including currency unit or units) in which the Securities of such
series are payable (except as otherwise specified pursuant to Section 3.01
for the Securities of such series) sufficient to pay on the Redemption Date
the Redemption Price of, and (unless the Redemption Date shall be an Interest
Payment Date) interest accrued to the Redemption Date on, all Securities or
portions thereof which are to be redeemed on that date.
Unless any Security by its terms prohibits any sinking fund payment
obligation from being satisfied by delivering and crediting Securities
(including Securities redeemed otherwise than through a sinking fund), the
Company may deliver such Securities to the Trustee for crediting against such
payment obligation in accordance with the terms of such Securities and this
Indenture.
Section 10.06. SECURITIES PAYABLE ON REDEMPTION DATE. Notice of
redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest and the coupons for any such interest
appertaining to any Bearer Security so to be redeemed, except to the extent
provided below, shall be void. Except as provided in the next succeeding
paragraph, upon surrender of any such Security, including coupons, if any, for
redemption in accordance with said notice, such Security shall be paid by the
Company at the Redemption Price, together with accrued interest (and any
Additional Amounts) to the Redemption Date; PROVIDED, HOWEVER, that installments
of interest on Bearer Securities whose Stated Maturity is on or prior to the
Redemption Date shall be payable only at an office or agency located outside the
United States and its possessions (except as otherwise provided in Section 9.02)
and, unless otherwise specified as contemplated by Section 3.01, only upon
presentation and surrender to coupons for such interest; and PROVIDED, FURTHER
that, unless otherwise specified as contemplated by Section 3.01, installments
of interest on Registered Securities whose Stated Maturity is on or prior to the
Redemption Date shall be payable to the Holders of such Securities, or one or
more Predecessor
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Securities, registered as such at the close of business on the relevant Record
Dates according to their terms and the provisions of Section 3.07.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant coupons maturing after the Redemption Date, such
Bearer Security may be paid after deducting from the Redemption Price an amount
equal to the face amount of all such missing coupons, or the surrender of such
missing coupon or coupons may be waived by the Company and the Trustee if there
be furnished to them such security or indemnity as they may require to save each
of them and any Paying Agent harmless. If thereafter the Holder of such Bearer
Security shall surrender to the Trustee or any Paying Agent any such missing
coupon in respect of which a deduction shall have been made from the Redemption
Price, such Holder shall be entitled to receive the amount so deducted;
PROVIDED, HOWEVER, that interest (and any Additional Amounts) represented by
coupons shall be payable only at an office or agency located outside of the
United States (except as otherwise specified pursuant to Section 9.02) and,
unless otherwise provided as contemplated by Section 3.01, only upon
presentation and surrender of those coupons.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
Section 10.07. SECURITIES REDEEMED IN PART. Upon surrender of a
Registered Security that is redeemed in part at any Place of Payment therefor
(with, if the Company or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or his attorney duly authorized in
writing), the Company shall execute and the Trustee shall authenticate and
deliver to the Holder of that Security, without service charge a new Registered
Security or Securities of the same series, having the same form, terms and
Stated Maturity, in any authorized denomination equal in aggregate principal
amount to the unredeemed portion of the principal amount of the Security
surrendered.
ARTICLE XI
Sinking Funds
Section 11.01. APPLICABILITY OF ARTICLE. The provisions of this
Article shall be applicable to any sinking fund for the retirement of Securities
of a series except as otherwise specified as contemplated by Section 3.01 for
Securities of such series.
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The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment", and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Securities of any
series, the cash amount of any sinking fund payment may be subject to reduction
as provided in Section 11.02. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.
Section 11.02. SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.
The Company (i) may deliver Outstanding Securities of a series (other than any
previously called for redemption) together, in the case of Bearer Securities of
such series, with all unmatured coupons appertaining thereto and (ii) may apply
as a credit Securities of a series which have been redeemed either at the
election of the Company pursuant to the terms of such Securities or through the
application of permitted optional sinking fund payments pursuant to the terms of
such Securities, in each case in satisfaction of all or any part of any sinking
fund payment with respect to the Securities of such series required to be made
pursuant to the terms of such Securities as provided for by the terms of such
series; provided that such Securities have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 11.03. REDEMPTION OF SECURITIES FOR SINKING FUND. Not less
than 60 days prior to each sinking fund payment date for any series of
Securities, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for that series
pursuant to the terms of that series, the portion thereof, if any, which is to
be satisfied by payment of cash and the portion thereof, if any, which is to be
satisfied be delivering and crediting Securities of that series pursuant to
Section 11.02 and will also deliver to the Trustee any Securities to be so
delivered to the extent it has not previously done so. Not less than 30 days
before each such sinking fund payment date the Trustee shall select the
Securities to be redeemed upon such sinking fund payment date in the manner
specified in Section 10.03 and cause notice of the redemption thereof to be
given in the name of and at the expense of the Company in the manner provided in
Section 10.04. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
10.06 and 10.07.
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ARTICLE XII
Subordination of Securities
Section 12.01. AGREEMENT TO SUBORDINATE. The Company, for itself,
its successors and assigns, covenants and agrees, and each Holder of Securities,
by his acceptance thereof, likewise covenants and agrees, that the payment of
the principal of (and premium, if any), interest on and any Additional Amounts
payable in respect of each and all of the Securities is hereby expressly
subordinated, to the extent and in the manner hereinafter set forth in this
Article XII (subject to the provisions of Article IV), in right of payment to
the prior payment in full of all Senior Indebtedness.
Section 12.02. DISTRIBUTION ON DISSOLUTION, LIQUIDATION AND
REORGANIZATION. In the event of (i) any insolvency, bankruptcy, receivership,
liquidation, reorganization, readjustment, composition or other similar
proceeding relating to the Company or its property, (ii) any proceeding for the
liquidation, dissolution or other winding-up of the Company, voluntary or
involuntary, whether or not involving insolvency or bankruptcy proceedings,
(iii) any assignment by the Company for the benefit of creditors or (iv) any
other marshaling of the assets and liabilities of the Company then, and in any
such event specified in (i), (ii), (iii) or (iv) (each such event, if any,
herein sometimes referred to as a "Proceeding") (subject to the power of a court
of competent jurisdiction to make other equitable provision reflecting the
rights conferred in this Indenture upon the Senior Indebtedness and the holders
thereof with respect to the Securities and the Holders thereof by a lawful plan
or reorganization under applicable Bankruptcy Law,
(a) the holders of all Senior Indebtedness shall first be entitled to
receive payment in full of the principal thereof, premium, if any, any
interest or any Additional Amounts required in respect of certain taxes,
and any interest therein, due thereon or provision must first be made for
such payment in cash or cash equivalents or any other manner acceptable to
the holders of such Senior Indebtedness before any payment or distribution,
whether in cash, securities or property (including any payment or
distribution which may be payable or deliverable by reason of the payment
of any other indebtedness of the Company subordinated to the payment of the
Securities, such payment or distribution being referred to as a "Junior
Subordinated Payment," but excluding any payment or distribution of
securities of the Company provided for by a plan of reorganization or
readjustment authorized by an order or
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decree of a court of competent jurisdiction in a reorganization proceeding
under any applicable Bankruptcy Law or of any other corporation provided
for by such plan of reorganization or readjustment which securities are
subordinated in right of payment to all then outstanding Senior
Indebtedness to substantially the same extent as the Securities are so
subordinated as provided in this Article), shall be made by the Company on
account of principal, premium, interest or Additional Amounts of or on the
Securities or interest on overdue amounts thereof; and
(b) any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, including any Junior
Subordinated Payment, to which the Holders of the Securities or the Trustee
would be entitled except for the provisions of this Article (and excluding
any payment or distribution of securities of the Company provided for by a
plan of reorganization or readjustment authorized by an order or decree of
a court of competent jurisdiction in a reorganization proceeding under any
applicable Bankruptcy Law or of any other corporation provided for by such
plan of reorganization or readjustment which securities are subordinated in
right of payment to all then outstanding Senior Indebtedness to
substantially the same extent as the Securities are so subordinated as
provided in this Article) shall be paid by the liquidating trustee or agent
or other person making such payment or distribution, whether a trustee in
bankruptcy, a receiver or liquidating trustee or otherwise, to the holders
of Senior Indebtedness or their representative or representatives or to the
trustee or trustees under any indenture under which any instruments
evidencing any of such Senior Indebtedness may have been issued, ratably
according to the aggregate amounts remaining unpaid on account of the
principal of, premium, if any, interest or Additional Amounts required in
respect of certain taxes, and any interest thereon, on the Senior
Indebtedness held or represented by each, to the extent necessary to make
payment in full of all Senior Indebtedness remaining unpaid, after giving
effect to any concurrent payment or distribution to the holders of such
Senior Indebtedness; and
(c) in the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, shall be received by the Trustee or the
Holders of the Securities before all Senior Indebtedness is paid in full,
then, and in such event such payment or distribution shall be paid over to
the holders of such Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any indenture under
which any instruments evidencing any of such Senior Indebtedness may have
been
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issued, ratably as aforesaid, for application to the payment of all Senior
Indebtedness remaining unpaid until all such Senior Indebtedness shall have
been paid in full, after giving effect to any concurrent payment or
distribution to the holders of such Senior Indebtedness. As used in this
Article, the phrase "payment in full" (or any similar phrase), when used
to refer to the payment of Senior Indebtedness, shall mean payment in full
of the aggregate amount of such Senior Indebtedness then outstanding in
cash, securities or other property.
The consolidation of the Company with, or the merger of the Company
with or into, another Person or the liquidation or dissolution of the Company
following the conveyance or transfer of all or substantially all of its
properties and assets as an entirety to another Person upon the terms and
conditions set forth in Article VII shall not be deemed a Proceeding for the
purposes of this Section if the Person formed by such consolidation with or into
which the Company is merged or the Person which acquires by conveyance or
transfer such properties and assets as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance or transfer, comply with the
conditions set forth in Article VII.
Section 12.03. PRIOR PAYMENT TO SENIOR INDEBTEDNESS UPON ACCELERATION
OF SECURITIES.
In the event that any Securities of a series are declared due and
payable before their Stated Maturity, then and in such event the holders of the
Senior Indebtedness outstanding at the time such Securities so became due and
payable shall be entitled to receive payment in full of all amounts due on or in
respect of such Senior Indebtedness (including any amounts due upon
acceleration), or provision shall be made for such payment in cash or cash
equivalents or otherwise in a manner satisfactory to the holders of Senior
Indebtedness, before the Holders of the Securities are entitled to receive any
payment or distribution of any kind or character, whether in cash, properties or
securities (including any Junior Subordinated Payment) by the Company on account
of the principal of, or premium, if any, or any interest or Additional Amounts
on such Securities or on account of the purchase or other acquisition of such
Securities by the Company or any Subsidiary of the Company.
In the event that, notwithstanding the foregoing, the Company shall
make any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, then and in such event such payment shall
be paid over and delivered forthwith to the Company.
The provisions of this Section shall not apply to any payment with
respect to which Section 12.02 would be applicable.
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Section 12.04. NO PAYMENT ON SECURITIES IN EVENT OF DEFAULT ON SENIOR
INDEBTEDNESS. In the event and during the continuation of (i) a Company default
in the payment of any principal, interest, if any or premium, if any, or any
Additional Amounts on any Senior Indebtedness when the same becomes due and
payable, whether at maturity or at a date fixed for repayment or declaration or
otherwise or (ii) an event of default with respect to any Senior Indebtedness
permitting the holders thereof to accelerate the maturity thereof and written
notice of such event of default (requesting that payments on the Securities
cease) is given to the Company by the holders of Senior Indebtedness, then
unless and until such default in payment or event of default shall have been
cured or waived or shall have ceased to exist, no direct or indirect payment (in
cash, property or securities, by set-off or otherwise) shall be made or agreed
to be made on account of the Junior Subordinated Debt or interest thereon or in
respect of any repayment, redemption. retirement, purchase or other acquisition
of Junior Subordinated Debt.
In the event that, notwithstanding the foregoing, the Company shall
make any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or, as the case may
be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section shall not apply to any payment with
respect to which Section 12.02 would be applicable.
Section 12.05. PAYMENTS ON SECURITIES PERMITTED. Nothing contained
in this Indenture or in any of the Securities shall (a) affect the obligation of
the Company to make, or prevent the Company from making, at any time except
during the pendency of any Proceeding referred to in Section 12.02 or under the
conditions described in Sections 12.03 and 12.04, payments of principal,
premium, interest or Additional Amounts, and any interest thereon, of or on the
Securities or (b) prevent the application by the Trustee of any moneys deposited
with it hereunder to the payment of or on account of the principal, premium,
interest or Additional Amounts, and any interest thereon, of or on the
Securities unless the Trustee shall have received at its Corporate Trust Office
written notice of any event prohibiting the making of such payment more than two
Business Days prior to the date fixed for such payment or prior to the execution
of an instrument to satisfy and discharge this Indenture based upon the deposit
of funds under Section 4.01(1)(B).
Section 12.06. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR
INDEBTEDNESS. Subject to the payment in full of all
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amounts due or to become due on all Senior Indebtedness, or the provision for
such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Indebtedness, the Holders of the
Securities shall be subrogated to the extent of the payments or distributions
made to the holders of such Senior Indebtedness pursuant to the provisions of
this Article (equally and ratably with the holders of all indebtedness of the
Company which by its express terms is subordinated to Senior Indebtedness of
the Company to substantially the same extent as the Securities are
subordinated to the Senior Indebtedness and is entitled to like rights of
subrogation by reason of any payments or distributions made to holders of
such Senior Indebtedness) to all of the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness until the principal of (and
premium, if any) and any interest and Additional Amounts on the Securities
shall be paid in full. For purposes of such subrogation or assignment, no
payments or distributions to the holders of the Senior Indebtedness of any
cash, property or securities to which the Holders of the Securities or the
Trustee would be entitled except for the provisions of this Article, and no
payments over pursuant to the provisions of this Article to the holders of
Senior Indebtedness by Holders of the Securities or the Trustee, shall, as
among the Company, its creditors other than holders of Senior Indebtedness,
and the Holders of the Securities, be deemed to be a payment or distribution
by the Company to or on account of the Senior Indebtedness.
Section 12.07. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. The
provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders of the Securities of any series on
the one hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article or elsewhere in this Indenture or in any Securities of
any series is intended to or shall (a) impair, as between the Company and the
Holders of the Securities of a series, the obligations of the Company, which are
absolute and unconditional, to pay to the Holders of the Securities the
principal of, premium, if any, and any interest and Additional Amounts on the
Securities as and when the same shall become due and payable in accordance with
their terms; or (b) affect the relative rights against the Company of the
Holders of the Securities and creditors of the Company other than their rights
in relation to the holders of Senior Indebtedness; or (c) prevent the Trustee or
the Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture including, without limitation,
filing and voting claims in any Proceeding, subject to the rights, if any, under
this Article of the holders of Senior Indebtedness to receive cash, property and
securities otherwise payable or deliverable to the Trustee or such Holder.
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Section 12.08. AUTHORIZATION OF HOLDERS OF SECURITIES TO TRUSTEE TO
EFFECT SUBORDINATION. Each Holder of Securities by his acceptance thereof
authorizes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article and appoints the Trustee his attorney-in-fact for any and all such
purposes.
Section 12.09. NOTICES TO TRUSTEE. The Company shall give prompt
written notice to a Responsible Officer of the Trustee located at the Corporate
Trust Office of the Trustee of any fact known to the Company which would prevent
the making of any payment to or by the Trustee in respect of the Securities.
Notwithstanding the provisions of this Article or any other provisions of this
Indenture, neither the Trustee nor any Paying Agent (other than the Company)
shall be charged with knowledge of the existence of any Senior Indebtedness or
of any event which would prohibit the making of any payment of moneys to or by
the Trustee or such Paying Agent, unless and until the Trustee or such Paying
Agent shall have received (in the case of the Trustee, at its Corporate Trust
Office) written notice thereof from the Company or from the holder of any Senior
Indebtedness or from the trustee for any such holder, together with proof
satisfactory to the Trustee of such holding of Senior Indebtedness or of the
authority of such trustee; PROVIDED, HOWEVER, that if at least two Business Days
prior to the date upon which by the terms hereof any such moneys may become
payable for any purpose (including, without limitation, the payment of the
principal, premium, interest or Additional Amounts, of or on any Security, or
any interest thereon) or the date on which the Trustee shall execute an
instrument acknowledging satisfaction and discharge of this Indenture, the
Trustee shall not have received with respect to such moneys or the moneys
deposited with it as a condition to such satisfaction and discharge the notice
provided for in this Section 12.09, then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such moneys and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary, which may be
received by it on or after such two Business Days prior to such date. The
Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Senior Indebtedness (or a trustee
on behalf of such holder) to establish that such a notice has been given by a
holder of Senior Indebtedness or a trustee on behalf of any such holder. In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of
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the Trustee as to the amount of Senior Indebtedness held by such Person, the
extent to which such Person is entitled to participate in such payment or
distribution and any other facts pertinent to the rights of such Person under
this Article and, if such evidence is not furnished, the Trustee may defer any
payment to such Person pending judicial determination as to the right of such
Person to receive such payment.
Section 12.10. TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS. The Trustee
shall be entitled to all the rights set forth in this Article in respect of any
Senior Indebtedness at any time held by it to the same extent as any other
holder of Senior Indebtedness and nothing in this Indenture shall be construed
to deprive the Trustee of any of its rights as such holder.
Section 12.11. NO WAIVER OF SUBORDINATION PROVISIONS. No right of
any present or future holder of any Senior Indebtedness to enforce subordination
as herein provided shall at any time in any way be prejudiced or impaired by any
act or failure to act on the part of the Company or by any act or failure to
act, in good faith, by any such holder, or by any noncompliance by the Company
with the terms, provisions and covenants of this Indenture, regardless or any
knowledge thereof that any such holder may have or otherwise be charged with.
Without in any way limiting the generality of the immediately
preceding paragraph, the holders of Senior Indebtedness may, at any time and
from time to time, without the consent of or notice to the Trustee or the
Holders of the Securities, without incurring responsibility to such Holders of
the Securities and without impairing or releasing the subordination provided in
this Article or the obligations hereunder of such Holders of the Securities to
the holders of Senior Indebtedness, do any one or more of the following: (i)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, Senior Indebtedness, or otherwise amend or supplement in any
manner Senior Indebtedness or any instrument evidencing the same or any
agreement under which Senior Indebtedness is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Indebtedness; (iii) release any Person liable in any manner for
the collection of Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company and any other Person.
Section 12.12. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF
LIQUIDATING AGENT. Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee, subject to the provisions of Article
VI, and the Holders of the Securities shall be entitled to rely upon any order
or decree entered by any court of competent
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jurisdiction in which such Proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders of the Securities, for
the purpose of ascertaining the Persons entitled to participate in such payment
or distribution, the holders of Senior Indebtedness and other indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article.
Section 12.13. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR
INDEBTEDNESS. The Trustee, in its capacity as trustee under this Indenture,
shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness and shall not be liable to any such holders if it shall in good
faith mistakenly pay over or distribute to Holders of Securities or to the
Company or to any other Person cash, property or securities to which any holders
of Senior Indebtedness shall be entitled by virtue of this Article or otherwise.
Section 12.14. ARTICLE APPLICABLE TO PAYING AGENTS. In case at any
time any Paying Agent other than the Trustee shall have been appointed bu the
Company and be then acting hereunder, the term "Trustee" as used in this Article
shall in such case (unless the context otherwise requires) be construed as
extending to and including such Paying Agent within its meaning as fully for all
intents and purposes as if such Paying Agent were named in this Article in
addition to or in place of the Trustee.
Section 12.15. CERTAIN CONVERSIONS OR EXCHANGES DEEMED PAYMENT. For
the purposes of this Article only, (a) the issuance and delivery of junior
securities upon exchange of Securities shall not be deemed to constitute a
payment or distribution on account of the principal of, premium, if any, or any
interest or Additional Amounts on Securities or on account of the purchase or
other acquisition or Securities, and (b) the payment, issuance or delivery of
cash, property or securities (other than junior securities) upon exchange of a
Security shall be deemed to constitute payment on account of the principal of
such Security. For purposes of this Section, the term "junior securities" means
(i) shares of any stock of any class of the Company and (ii) securities of the
Company which are subordinated in right of payment to all Senior Indebtedness
which may be outstanding at the time of issuance or delivery of such securities
to substantially the same extent as, or to a greater extent than, Securities are
so subordinated as provided in this Article.
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This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
METRIS COMPANIES INC.
By:
--------------------------------
Name:
Title:
{Seal}
Attest:
By:
----------------------------
Name:
Title:
[Trustee]
By:
--------------------------------
Name:
Title:
{Seal}
Attest:
By:
-----------------------------
Name:
Title:
<PAGE>
[SIDLEY & AUSTIN LETTERHEAD]
September 22, 1998
Board of Directors
Metris Companies Inc.
600 South Highway 169
Suite 1800
St. Louis Park, Minnesota 55426-1222
Re: REGISTRATION STATEMENT ON FORM S-3 (NO. 333-60973)
Dear Gentlemen:
We are counsel to Metris Companies Inc., a Delaware corporation (the
"Company"), and have represented the Company with respect to the Registration
Statement on Form S-3, Registration No. 333-60973 (the "Registration
Statement") filed by the Company with the Securities and Exchange Commission
(the "Commission") under the Securities Act of 1933, as amended (the
"Securities Act") relating to the offer and sale of $750,000,000 in
securities of the Company, consisting of debt securities (the "Debt
Securities"), preferred stock, par value $.01 per share (the "Preferred
Stock") and common stock, par value $.01 per share (the "Common Stock").
Unless otherwise specified in the applicable prospectus supplement, the Debt
Securities will be issued under an Indenture (the "Indenture") between the
Company and the trustee identified therein (the "Trustee") in the form filed
as an exhibit to the Registration Statement.
In rendering this opinion, we have examined and relied upon a copy of
the Registration Statement. We have also examined or caused to be examined
originals, or copies of originals certified to our satisfaction, of such
agreements, documents, certificates and statements of government officials
and other instruments, and have examined such questions of law and have
satisfied ourselves as to such matters of fact, as we have considered
relevant and necessary as a basis for this opinion. We have assumed the
authenticity of all documents submitted to us as originals, the genuineness
of all signatures, the legal capacity of all natural persons and the
conformity with the original documents of any copies thereof submitted to us
for examination.
Based on the foregoing, and subject to the qualifications and
limitations hereinafter set forth, we are of the opinion that:
<PAGE>
SIDLEY & AUSTIN CHICAGO
Board of Directors
September 22, 1998
Page 2
1. With respect to any series of Debt Securities when (i) the
Registration Statement, as finally amended (including any necessary
post-effective amendments), shall have become effective under the
Securities Act and the Indenture, (including any necessary supplemental
indenture), shall have been duly qualified under the Trust Indenture Act
of 1939, as amended, and duly executed and delivered by the Company and
the Trustee; (ii) a prospectus supplement with respect to such series of
Debt Securities shall have been filed with the Commission in compliance
with the Securities Act and the rules and regulations thereunder; (iii)
the Company's Board of Directors or duly authorized committee thereof
shall have duly adopted final resolutions authorizing the issuance and
sale of such series of Debt Securities; (iv) such series of Debt
Securities shall have been duly executed and authenticated as provided
in the Indenture and shall have been delivered to purchasers thereof
against payment of the agreed consideration therefor; and (v) any
consents required pursuant to the Company's credit facilities shall have
been obtained, each series of Debt Securities will be legally issued and
enforceable against the Company in accordance with its terms (except as
may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other similar laws affecting the
enforcement of creditors' rights generally and by the effect of general
principles of equity, regardless of whether enforceability is considered
in a proceeding in equity or at law).
2. With respect to any series of Preferred Stock, when (i) the
Registration Statement, as finally amended (including any necessary
post-effective amendments), shall have become effective under the
Securities Act; (ii) a prospectus supplement with respect to such series
of Preferred Stock shall have been filed with the Commission in
compliance with the Securities Act and the rules and regulations
thereunder; (iii) the Company's Board of Directors or duly authorized
committee thereof shall have duly adopted final resolutions specifying
the terms and conditions of such series of Preferred Stock and
authorizing its issuance; (iv) the Company shall have filed with the
Delaware Secretary of State a certificate of designation with respect to
such series of Preferred Stock; and (v) certificates representing such
series of Preferred Stock shall have been duly executed, countersigned
and registered and duly delivered to the purchasers thereof against
payment of the agreed consideration therefor, such series of Preferred
Stock will be legally issued, fully paid and nonassessable.
3. With respect to Common Stock, when (i) the Registration
Statement, as finally amended (including any necessary post-effective
amendments), shall have become effective under the Securities Act; (ii)
a prospectus supplement with respect to the sale of Common Stock shall
have been filed with the Commission in compliance with the Securities
Act and the rules and regulations thereunder; (iii) the Corporation's
Board of
<PAGE>
SIDLEY & AUSTIN CHICAGO
Board of Directors
September 22, 1998
Page 3
Directors or duly authorized committee thereof shall have duly adopted
final resolutions authorizing the issuance and sale of the Common Stock;
and (iv) certificates representing the Common Stock shall have been duly
executed, countersigned and registered and duly delivered to the
purchasers thereof against payment of the agreed consideration therefor,
the Common Stock will be legally issued, fully paid and nonassessable.
We do not find it necessary for the purposes of this opinion to cover,
and accordingly we express no opinion as to, the application of the
securities or "Blue Sky" laws of the various states to the sale of the
securities to be registered pursuant to the Registration Statement. Without
limiting the generality of the foregoing, we express no opinion in connection
with the matters contemplated by the Registration Statement, and no opinion
may be implied or inferred, except as expressly set forth herein.
This opinion is limited to the laws of the State of Illinois, the State
of New York, the Delaware General Corporation Law and the Securities Act.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and to all references to our firm in the Registration
Statement or the Prospectus included therein.
Very truly yours,
/s/ Sidley & Austin
<PAGE>
Exhibit 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors
Metris Companies Inc.:
We consent to the use of our report dated January 21, 1998 incorporated
herein by reference and to the reference to our firm under the heading
"EXPERTS" in the prospectus.
/s/ KPMG Peat Marwick LLP
Minneapolis, Minnesota
September 22, 1998
