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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 8, 1999
REGISTRATION STATEMENT NO. 333-70369
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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PRIME GROUP REALTY TRUST
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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<S> <C>
MARYLAND 36-4173047
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR IDENTIFICATION
ORGANIZATION) NO.)
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77 West Wacker Drive, Suite 3900
Chicago, Illinois 60601
(312) 917-1300
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
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JAMES F. HOFFMAN, ESQ.
SENIOR VICE PRESIDENT,
GENERAL COUNSEL AND SECRETARY
PRIME GROUP REALTY TRUST
77 WEST WACKER DRIVE, SUITE 3900
CHICAGO, ILLINOIS 60601
(312) 917-1300
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
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COPIES TO:
WAYNE D. BOBERG, ESQ.
BRIAN T. BLACK, ESQ.
WINSTON & STRAWN
35 WEST WACKER DRIVE
CHICAGO, ILLINOIS 60601
(312) 558-5600
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement as the
Registrant shall determine.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
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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. / /
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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. / /
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If this Form is a post-effective amendment filed pursuant to Rule 462(d)
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. / /
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If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
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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 UNITED STATES SECURITIES AND EXCHANGE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
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THIS INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
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SUBJECT TO COMPLETION--DATED JUNE 8, 1999
PROSPECTUS
$500,000,000
PRIME GROUP REALTY TRUST
Common Shares of Beneficial Interest
Preferred Shares of Beneficial Interest
Depositary Shares
Share Purchase Contracts
Senior Debt Securities
Subordinated Debt Securities
Warrants to Purchase Common Shares
Warrants to Purchase Preferred Shares
Warrants to Purchase Depositary Shares
Warrants to Purchase Debt Securities
CORPORATE HEADQUARTERS:
77 West Wacker Drive
Suite 3900
Chicago, Illinois 60601
(312) 917-1300
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This prospectus may not be used to sell these securities unless accompanied by a
prospectus supplement, which will describe the specific terms of the securities.
We urge you to read this prospectus and the accompanying prospectus supplement
carefully before you make your investment decision.
INVESTING IN OUR SECURITIES INVOLVES CERTAIN RISKS. SEE "RISK FACTORS" ON PAGES
4 TO 13.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS OR THE ACCOMPANYING PROSPECTUS SUPPLEMENT IS TRUTHFUL OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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The date of this prospectus is
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ABOUT THIS PROSPECTUS
The prospectus is part of a registration statement that we filed with the
SEC utilizing a "shelf" registration process. Under this shelf process, Prime
Group Realty Trust may offer and sell any combination of the securities
described in this prospectus in one or more offerings up to a total dollar
amount of $500,000,000. This prospectus provides you with a general description
of the securities we may offer. Each time we offer securities, we will provide a
prospectus supplement and attach it to this prospectus. The prospectus
supplement will contain specific information about the terms of the securities
being offered at that time. The prospectus supplement may also add, update or
change information contained in this prospectus. You should read both this
prospectus and any prospectus supplement, including the documents we have
referred to under the heading "Incorporation of Certain Documents by Reference,"
together with any additional information you may need to make your investment
decision.
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
SAFE HARBOR CAUTIONARY STATEMENT
THIS PROSPECTUS AND THE DOCUMENTS INCORPORATED BY REFERENCE HEREIN CONTAIN
"FORWARD-LOOKING" STATEMENTS, AS DEFINED IN THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995, THAT ARE BASED ON OUR CURRENT EXPECTATIONS, ESTIMATES AND
PROJECTIONS. STATEMENTS THAT ARE NOT HISTORICAL FACTS, INCLUDING STATEMENTS
ABOUT OUR BELIEFS AND EXPECTATIONS, ARE FORWARD-LOOKING STATEMENTS. THESE
STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE, EVENTS OR RESULTS AND
INVOLVE POTENTIAL RISKS AND UNCERTAINTIES. ACCORDINGLY, ACTUAL RESULTS MAY
DIFFER MATERIALLY. WE UNDERTAKE NO OBLIGATION TO UPDATE PUBLICLY ANY
FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE
EVENTS OR OTHERWISE.
IMPORTANT FACTS THAT MAY AFFECT THESE EXPECTATIONS, ESTIMATES OR PROJECTIONS
INCLUDE, BUT ARE NOT LIMITED TO: GENERAL ECONOMIC AND BUSINESS CONDITIONS, WHICH
WILL, AMONG OTHER THINGS, AFFECT DEMAND FOR OFFICE AND INDUSTRIAL PROPERTIES,
AVAILABILITY AND CREDITWORTHINESS OF PROSPECTIVE TENANTS, LEASE RENTS AND THE
AVAILABILITY OF FINANCING; ADVERSE CHANGES IN THE REAL ESTATE MARKETS INCLUDING,
AMONG OTHER THINGS, COMPETITION WITH OTHER COMPANIES; RISKS OF REAL ESTATE
ACQUISITION AND DEVELOPMENT; GOVERNMENTAL ACTIONS AND INITIATIVES; AND
ENVIRONMENTAL REQUIREMENTS, AND THE OTHER FACTORS DESCRIBED IN THIS PROSPECTUS
UNDER THE HEADING "RISK FACTORS."
ABOUT PRIME GROUP REALTY TRUST
GENERAL
We are a fully-integrated real estate investment company organized under
Maryland law, providing property management, leasing, marketing, acquisition,
development, redevelopment, construction, finance and other related services. We
have elected to be taxed as a real estate investment trust (a "REIT") for
federal income tax purposes beginning with our taxable period ended December 31,
1997. We own 26 office properties, 48 industrial properties, one retail center
and one parking facility. Our properties are located primarily in the Chicago
metropolitan area. In addition, we own a mortgage on an office property located
at 180 N. LaSalle Street, Chicago, Illinois.
We also own approximately 236.5 acres of developable land and rights to
acquire more than 301.8 additional acres of developable land which management
believes could be developed with approximately 12.0 million square feet of
additional office and industrial space.
In terms of net rentable square feet, approximately 81.5% of our office
properties and 88.1% of our industrial properties are located in the Chicago
metropolitan area in prime business locations within established business
communities. Our remaining office properties are located in the Cleveland, Ohio;
Nashville, Tennessee; Knoxville, Tennessee; and Milwaukee, Wisconsin
metropolitan areas. Our remaining industrial properties are located in the
Columbus, Ohio metropolitan area. We believe that
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our properties are well-located, have excellent highway access, attract
high-quality tenants, are well-maintained and are professionally managed. Our
properties have a diverse and stable base of tenants and have historically
provided steadily increasing rents. We believe this is due to the quality of our
properties, the contractual rent escalations contained in a number of long-term
leases and the strength of the markets in which the properties are located.
Our primary business strategy is to achieve our investment and growth
objectives by focusing on the acquisition, development and operation of office
and industrial real estate located in the Chicago metropolitan area and, to a
lesser extent, other midwestern markets. To implement this strategy, we intend
to continue to:
- own, acquire, develop, redevelop, lease, manage and operate Class A office
buildings that have below market rents and, therefore, provide the
opportunity to enhance returns as leases expire or are renewed;
- develop Class A office buildings in prime locations with significant
leasing potential;
- acquire distressed, under-performing and under-managed Class B office
buildings in desirable locations and improve the income potential of such
assets by raising them to a higher operating standard through value-added
renovation programs, professional property management and aggressive
leasing, retenanting and marketing efforts;
- acquire and develop properties that underutilize their sites or that have
excess land for future development;
- acquire properties or portfolios of properties from tax-sensitive owners
where the properties can be acquired on a tax-deferred basis using common
units of limited partner interest in our operating partnership, Prime
Group Realty, L.P., as purchase consideration; and
- own, acquire, develop, redevelop, lease, manage and operate bulk
warehouse/distribution facilities and overhead crane/manufacturing
facilities.
Class A office buildings are centrally located, professionally managed and
maintained, attract high-quality tenants and command upper-tier rental rates and
are modern structures or have been modernized to compete with newer buildings.
Class B office buildings have good location, construction and tenancy and are
sometimes considered to be competitive with the lower spectrum of Class A
buildings.
We believe that we can draw upon our extensive experience and long-term
presence in the Chicago metropolitan area to create a strategic advantage in
competing for future development and acquisition opportunities.
We are the managing general partner of, and currently hold 58.9% of the
economic interests in, the operating partnership. We conduct substantially all
of our business through the operating partnership, except for some office and
industrial development, leasing, construction, property management services and
land sales which are conducted through Prime Group Realty Services, Inc., a
Maryland corporation (the "Services Company.")
We were formed on July 21, 1997 as a Maryland real estate investment trust.
On November 17, 1997, we sold 12,380,000 of our common shares at a price of
$20.00 per share in an underwritten offering and became a public company. Our
executive offices are located at 77 West Wacker Drive, Suite 3900, Chicago,
Illinois 60601, and our telephone number is (312) 917-1300.
SERVICES COMPANY
The Services Company was formed in March 1997 under the laws of the state of
Maryland. The operating partnership owns 100.0% of the nonvoting preferred stock
of the Services Company,
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representing 95.0% of its economic value and also has a $4.8 million promissory
note issued from the Services Company in connection with its formation. We have
also provided a $5.0 million line-of-credit to the Services Company. This
ownership structure permits us to share in the Services Company's income and
also maintain our status as a REIT for federal income tax purposes. We receive
substantially all of the economic benefit of the businesses carried on by the
Services Company because we have the right to receive dividends through the
operating partnership's investment in the preferred stock and interest payments
on the line-of-credit and the note held by the operating partnership. However,
we do not elect the Services Company's officers or directors and, consequently,
do not have the ability to control the operations of the Services Company or
require the declaration of dividends.
The Services Company provides certain corporate advisory, management,
leasing, tenant improvement construction, painting, contracting and tenant
representation services to buildings owned by others. The Services Company's
leasing division provides leasing services to certain of our properties and
other property owners for fees. The Services Company's construction division
provides construction and construction management services for tenant
improvements, renovations and other construction to the properties owned,
acquired or managed by us. The Services Company also acquires, markets and sells
land.
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RISK FACTORS
In addition to the other information presented or incorporated by reference
in this prospectus, you should carefully consider the following matters before
purchasing any of our securities offered by this prospectus.
CONFLICTS OF INTEREST
OUR PARTNERS IN THE OPERATING PARTNERSHIP, INCLUDING SEVERAL OF OUR OFFICERS
AND TRUSTEES, HAVE THE ABILITY TO INFLUENCE THE OPERATING PARTNERSHIP. Mr.
Michael W. Reschke, through various affiliates including The Prime Group, Inc.
(collectively, "PGI"), owns a substantial indirect interest in our operating
partnership, Prime Group Realty, L.P. Therefore, conflicts may exist between the
obligations of Mr. Reschke as one of our trustees and officers and his interest
in the operating partnership through his ownership interests in PGI.
Mr. Jeffrey A. Patterson, one of our executive officers, owns a 0.4%
interest in the operating partnership. Blackstone Real Estate Advisors, L.P.
("Blackstone"), as the 40.0% owner of a joint venture (the "Primestone Joint
Venture") that owns a 30.9% interest in the operating partnership, designated
Mr. Thomas J. Saylak to be elected as one of our trustees. The Primestone Joint
Venture is between PGI, BRE/Primestone Investment L.L.C. and BRE/Primestone
Management Investors L.L.C., which are affiliates of Blackstone. Therefore,
conflicts may exist between the obligations of Mr. Patterson, as one of our
officers, and Mr. Saylak, as one of our trustees, and their respective interests
in the operating partnership.
Several entities and persons which contributed properties to us in
connection with our formation own, in total, an 8.0% interest in the operating
partnership. Each of these property contributors are controlled by or affiliated
with Mr. Edward S. Hadesman or Mr. Stephen J. Nardi. Mr. Hadesman is one of our
officers and Mr. Nardi is one of our trustees. As limited partners of our
operating partnership, PGI and the limited partners controlled by or affiliated
with Mr. Hadesman and, as a general partner of our operating partnership, the
general partner that is controlled by Mr. Nardi, may suffer different and more
adverse tax consequences than we will upon the sale or refinancing of properties
contributed by them in connection with our formation.
Further, PGI has agreed to indemnify us for amounts we may be required to
pay for tax liabilities which may be incurred by Mr. Nardi or his affiliates, or
by Mr. Hadesman or his affiliates, upon the sale of properties they contributed
to us in connection with our formation, provided we used our best efforts to
minimize the tax consequences of any such disposition. Therefore, PGI, the
limited partners controlled by or affiliated with Mr. Hadesman and the general
partner controlled by Mr. Nardi may have objectives regarding the appropriate
pricing and timing of any sale or refinancing of such properties that differ
from our objectives. While we, as the managing general partner of the operating
partnership, have the ability to determine whether and on what terms to sell or
refinance an individual property, those members of our management and our board
of trustees who directly or indirectly hold common units in the operating
partnership could have an ability to influence us not to sell or refinance
certain properties, even though a sale might otherwise be financially
advantageous to us, or may influence us to refinance a property with a high
level of debt.
MR. RESCHKE, OUR CHAIRMAN OF THE BOARD, CONTINUES TO ENGAGE IN ACTIVITIES
OUTSIDE OF PRIME, INCLUDING REAL ESTATE ACTIVITIES. Under the terms of his
employment agreement with us as our chairman of the board Mr. Reschke is
permitted to devote a considerable portion of his time to the management of
other interests. In addition to serving as our chairman of the board and the
chairman of our executive committee, Mr. Reschke serves as chairman of the board
of Prime Retail, Inc. (NYSE: PRT), chairman of the board of Brookdale Living
Communities, Inc. (Nasdaq: BLCI), chairman of the board and CEO of The Prime
Group, Inc., and a director of Horizon Group Properties, Inc. (Nasdaq: HGPI). As
a result of these interests and the business time to be devoted to activities
related to them, conflicts of
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interest may arise between Mr. Reschke's duties and responsibilities to us and
these other interests. We could be adversely affected if these conflicts of
interest were to impair the performance of his managerial duties and
responsibilities to us.
PARTNER APPROVAL RIGHTS LIMIT OUR ABILITY TO TAKE CERTAIN ACTIONS WITH
RESPECT TO THE OPERATING PARTNERSHIP. Although we generally have the ability to
exercise full and exclusive responsibility and discretion in the management and
control of the operating partnership, provisions of the operating partnership's
partnership agreement limit our ability to make decisions on behalf of the
operating partnership. For example:
- we cannot take any action to dissolve the operating partnership without
the prior consent of the holders of more than 50.0% of the common units in
the operating partnership; and
- in connection with any extraordinary transactions, such as a merger or
consolidation, that treats partners in the operating partnership
differently than the holders of common shares, the consent of partners
holding more than 50.0% of the common units is required.
REAL ESTATE FINANCING RISKS
REQUIRED REPAYMENT OF DEBT OR OF RELATED INTEREST COULD ADVERSELY AFFECT
US. We are generally subject to the risks associated with debt financing. These
risks include:
- the risk that our cash flow will not satisfy required payments of
principal and interest;
- the risk that we cannot refinance existing indebtedness on our properties
as necessary or that the terms of the refinancing will be less favorable
to us than the terms of existing debt; and
- the risk that necessary capital expenditures for purposes such as
reletting space cannot be financed on favorable terms.
If a property is mortgaged to secure payment of indebtedness and we cannot pay
the mortgage payments, we may have to surrender the property to the lender with
a consequent loss of any prospective income and equity value from such property.
OUR ABILITY TO INCREASE OUR DEBT COULD ADVERSELY AFFECT OUR CASH
FLOW. Generally, our organizational documents do not limit the level or amount
of debt that we may incur. At March 31, 1999, we had outstanding debt of
approximately $756.0 million. If we were to become more highly leveraged, our
cash needs to fund debt service would increase accordingly. Such an increase
could adversely affect our financial condition and results of operations. In
addition, increased leverage could increase the risk of default on our debt
obligations, which could reduce our cash available for distribution and our
asset values.
OUR ABILITY TO CONTINUE TO OBTAIN PERMANENT FINANCING CANNOT BE ASSURED. In
the past, we have financed certain acquisitions and certain development
activities in part with proceeds from our credit facility with BankBoston, N.A.,
CIBC, Inc. and Prudential Securities Credit Corporation, as amended. This
financing has been, and may continue to be, replaced by permanent financing.
However, we may not be able to obtain permanent financing for future
acquisitions or development activities on acceptable terms. If market interest
rates were to increase at a time when amounts were outstanding under the credit
facility or under our floating rate tax-exempt bond debt or if other variable
rate debt was outstanding, our debt interest costs would increase, causing
potentially adverse effects on our financial condition and results of
operations.
ANTI-TAKEOVER PROVISIONS COULD INHIBIT A CHANGE OF CONTROL
EQUITY OWNERSHIP LIMIT COULD INHIBIT TAKEOVERS OR CHANGES OF CONTROL THAT
MIGHT BE BENEFICIAL TO OUR COMMON SHAREHOLDERS. In order to protect our REIT
status for federal income tax purposes against a
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prohibited concentration of ownership among our shareholders, our declaration of
trust, as restated and supplemented, contains an ownership limit. We refer to
this as the "Ownership Limit." The Ownership Limit generally provides that no
person or entity may own, or be deemed to own by virtue of the applicable
constructive ownership provisions of the Internal Revenue Code, more than 9.9%
of our outstanding Equity Shares. "Equity Shares" means our outstanding common
shares, our Series A Cumulative Convertible Redeemable Preferred Shares and our
9% Series B Cumulative Redeemable Preferred Shares. The Ownership Limitations
may preclude a third party's acquisition of control of us without the consent of
our board of trustees. Consequently, our shareholders may be unable to realize a
premium for their shares over the then-prevailing market price because a premium
is customarily associated with such acquisitions. See "Description of Our Shares
of Beneficial Interest--Restrictions on Ownership and Transfer."
ISSUANCE OF ADDITIONAL PREFERRED SHARES COULD INHIBIT TAKEOVERS OR CHANGES
OF CONTROL THAT MIGHT BE BENEFICIAL TO OUR COMMON SHAREHOLDERS. Our declaration
of trust permits us to issue up to 30.0 million preferred shares, and to
establish the preferences and rights of any such preferred shares issued,
without shareholder approval. This capability allows our board of trustees to
authorize the issuance of preferred shares with terms and conditions which could
discourage a tender offer or other transaction in which holders of some or a
majority of the common shares might receive a premium over the then-prevailing
market price of such common shares. Of such 30.0 million preferred shares, 2.0
million have been issued as our convertible preferred shares and 4.0 million
have been issued as our redeemable preferred shares. See "Description of Our
Shares of Beneficial Interest--Redeemable Preferred Shares and--Convertible
Preferred Shares."
OUR STAGGERED BOARD COULD INHIBIT TAKEOVERS OR CHANGES OF CONTROL THAT MIGHT
BE BENEFICIAL TO OUR COMMON SHAREHOLDERS. Our board of trustees is divided into
three classes of trustees that are elected to serve staggered three-year terms.
Generally, a trustee may be removed only for cause and upon the affirmative vote
of two-thirds of our outstanding common shares. The staggered terms of trustees
may reduce the possibility of a tender offer or an attempt to change control
even though a tender offer or a change of control might benefit our
shareholders.
CERTAIN PROVISIONS OF THE PARTNERSHIP AGREEMENT COULD INHIBIT TAKEOVERS OR
CHANGES OF CONTROL THAT MIGHT BE BENEFICIAL TO OUR COMMON SHAREHOLDERS. The
operating partnership's partnership agreement generally prohibits us from
engaging in a "business combination," such as any merger, consolidation or other
combination with or into another person or in any reclassification, or any
recapitalization or change of outstanding common shares or from selling all or
substantially all of our assets, unless certain conditions are met. In
particular, the holders of common units must receive, or have the opportunity to
receive, the same consideration per common unit as holders of common shares
receive per common share in the transaction. If holders of common units will not
be treated in such manner, then we may not engage in such transaction unless
partners holding more than 50.0% of the common units vote to approve the
business combination.
In addition, if we conducted a vote of our shareholders regarding a business
combination, we could not complete the transaction unless it would have been
approved had holders of common units been able to vote together with our
shareholders on the transaction. In other words, if our shareholders did approve
a business combination, we could not complete it unless all three of the
following conditions are met:
- we, as managing general partner of the operating partnership, conduct a
vote of all holders of common units, including both limited partner and
general partner common units;
- we vote our common units in the same proportion as our shareholders voted
their shares at the shareholder meeting; and
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- the result of the common unit vote is an affirmative vote of at least that
percentage necessary for our shareholders to approve the business
combination.
These provisions of the partnership agreement could inhibit a third party from
making an acquisition proposal that it may otherwise make. The provisions may
also prevent us from completing a business combination even though we had the
requisite authority to do so under our declaration of trust.
POSSIBLE LIMITATIONS ON CHANGE OF CONTROL PURSUANT TO MARYLAND BUSINESS
COMBINATION STATUTE. Maryland law prohibits us from engaging in "business
combinations" with designated persons, including beneficial owners of 10% or
more of our outstanding voting shares ("Interested Shareholders"). These
prohibitions last for five years after the most recent date on which the
Interested Shareholder became an Interested Shareholder. Thereafter, a business
combination with the Interested Shareholder may not be completed unless
conditions specified in the statute for the protection of shareholders are
satisfied. These provisions could discourage offers from third parties to
acquire us and increase the difficulty of consummating any such offer. These
provisions of Maryland law do not apply, however, to business combinations that
are approved or exempted by our board of trustees prior to the time that the
Interested Shareholder becomes an Interested Shareholder.
POSSIBLE LIMITATIONS ON CHANGE OF CONTROL PURSUANT TO MARYLAND CONTROL SHARE
ACQUISITION STATUTE. Maryland's control share acquisition statute provides that
"control shares" of a Maryland REIT acquired in a "control share acquisition"
generally have no voting rights except to the extent approved by a vote of
two-thirds of the votes eligible under the statute to be cast on the matter.
"Control shares" are voting shares of stock or beneficial interest which entitle
their holder to several specified ranges of voting power in elections of
directors or trustees. If voting rights are not approved at a meeting of
shareholders, then a Maryland company generally may redeem any or all of the
control shares for fair value. If voting rights for control shares are approved
at a shareholders' meeting and the acquiror becomes entitled to vote a majority
of the shares of beneficial interest entitled to vote, all other shareholders
may exercise appraisal rights.
Our bylaws, as amended and restated, contain a provision exempting from the
control share acquisition statute any and all acquisitions by any person of our
shares of beneficial interest. This provision may be amended or eliminated at
any point in the future without shareholder approval. If the foregoing exemption
in our bylaws is rescinded, the control share acquisition statute could
discourage third party offers to acquire us and increase the difficulty of
consummating any such offer.
ADVERSE CONSEQUENCES IF WE FAIL TO QUALIFY AS A REIT; OTHER TAX LIABILITIES
SIGNIFICANT TAX LIABILITIES COULD RESULT IF WE FAIL TO QUALIFY AS A
REIT. We intend to qualify as a REIT for federal income tax purposes. A REIT
generally is not subject to federal income tax at the corporate level on income
which it currently distributes to its shareholders so long as it distributes at
least 95% of its taxable income (excluding any net capital gain) each year.
Many of the REIT requirements are highly technical and complex. The
determination that we qualify as a REIT requires an analysis of various factual
matters and circumstances which are not entirely within our control. The fact
that we hold our assets in partnership form through the operating partnership
further complicates the application of the REIT requirements. Furthermore,
Congress and the Internal Revenue Service might make changes to the tax laws and
regulations, and the courts might issue new rulings, that might make it more
difficult, or impossible, for us to remain qualified as a REIT.
If we fail to qualify as a REIT, we would be subject to federal income tax
at regular corporate rates. Also, unless entitled to relief under certain
statutory provisions, we would be ineligible for qualification as a REIT for
four years following the year in which we fail to qualify. Such disqualification
would lower our net earnings available for investment or distribution to
shareholders
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due to the additional tax liability. This likely would have a significant
adverse affect on the value of our securities. See "Material Federal Income Tax
Considerations--Taxation of Prime Group Realty Trust-- Failure to Qualify."
OTHER TAX LIABILITIES COULD RESULT IF WE ENGAGE IN CERTAIN PROHIBITED
TRANSACTIONS. Even if we qualify as and maintain our status as a REIT, we will
be subject to certain federal, state and local taxes on our income and property.
For example, if we have net income from a "prohibited transaction," such income
will be subject to a 100.0% tax. See "Material Federal Income Tax
Considerations--Taxation of Prime Group Realty Trust--Requirements for REIT
Qualification--Penalty Tax on Prohibited Transactions."
DISTRIBUTIONS TO OUR SHAREHOLDERS ARE AFFECTED BY MANY FACTORS. Our
distributions to shareholders are based principally on cash available for
distribution from our properties. Contractual increases in rent under the leases
of the properties and the receipt of rental revenue in connection with future
acquisitions are expected to increase our cash available for distribution to
shareholders. However, if a lessee defaults under or terminates a lease, there
could be a decrease or cessation of rental payments from the lessee. Such a
decrease could in turn decrease cash available for distribution. In addition,
the amount available to make distributions may decrease if properties acquired
in the future yield lower than expected returns.
The distribution requirements for REITs under federal income tax laws may
limit our ability to finance future developments, acquisitions and/or expansions
without additional debt or equity financing. If we incur additional indebtedness
in the future, it will require additional funds to service such indebtedness. As
a result, amounts available to make distributions may decrease. Our
distributions are also dependent on a number of other factors, including our
financial condition, any decision to reinvest Funds rather than to distribute
such funds, capital expenditures, the annual distribution requirements under the
REIT provisions of the Internal Revenue Code and such other factors as we deem
relevant. See "Material Federal Income Tax Considerations--Taxation of Prime
Group Realty Trust-- Requirements for REIT Qualification--Annual Distribution
Requirements."
HISTORICAL LOSSES; POSSIBILITY OF FUTURE LOSSES. Through the properties
which PGI contributed to us at our formation, we have had historical accounting
losses for certain fiscal years, and there can be no assurance that we will not
have similar losses in the future.
ACQUISITION AND DEVELOPMENT RISKS
GENERAL. We intend to continue to acquire additional office and industrial
properties and anticipate that future acquisitions will be financed, in part,
through a combination of secured or unsecured financing. If we finance new
developments through construction loans, there is a risk that, upon completion
of construction, permanent financing for newly-developed properties may not be
available or may be available only on disadvantageous terms. In addition, there
is a risk that we could acquire office or industrial properties that fail to
perform in accordance with expectations. Our estimates of the costs of
improvements to bring an acquired property up to standards established for the
market position intended for that property may also prove inaccurate. Further,
there are general investment risks associated with any real estate investment.
See "--Our Performance and Asset Values are Subject to Real Estate Investment
Risks--General."
While we expect to continue to limit our business primarily to the Chicago
metropolitan area, and to a lesser extent the rest of the midwestern United
States, it is possible that we will expand our business to new geographic
markets in the future. In such event, we will not initially possess the same
level of familiarity with new markets as we have with our current markets. Our
lack of familiarity in such cases could adversely affect our ability to develop,
acquire, manage or lease properties in the new markets.
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CASH FLOWS FROM OUR ANTICIPATED DEVELOPMENT ACTIVITIES ARE UNCERTAIN. A
portion of our anticipated cash available for distribution may be generated from
development activities. These activities are partially dependent on the
availability of development opportunities and are subject to the risks inherent
in development and general economic conditions. We may not realize such
anticipated cash flows from future development projects.
OUR PERFORMANCE AND ASSET VALUES ARE SUBJECT TO REAL ESTATE INVESTMENT RISKS
GENERAL. Real property investments are subject to varying degrees of risk.
If our properties do not generate income sufficient to meet operating expenses,
including debt service and capital expenditures, our ability to make
distributions to shareholders could be adversely affected. Income from, and the
value of, our properties may be adversely affected by:
- the general economic climate;
- local conditions such as oversupply of office or industrial space or a
reduction in demand for office or industrial space in the area;
- the attractiveness of our properties to potential tenants;
- competition from other office or industrial properties; and
- our ability to pay for adequate maintenance and insurance and increased
operating costs, including insurance premiums, utilities and real estate
taxes.
In addition, revenues from properties and real estate values are affected by
such factors as interest rate levels, the availability of financing, the cost of
compliance with regulations and the potential for liability under applicable
laws, including changes in tax laws.
Further, our income would be adversely affected if a significant number of
tenants were unable to pay rent or if office or industrial space could not be
rented on favorable terms. Certain significant expenditures associated with an
investment in real estate, such as mortgage payments, real estate taxes and
maintenance costs, generally are not reduced when circumstances cause a
reduction in rental income from tenants. It would be very difficult for us to
convert a project to an attractive alternative use or to sell a project to
recoup our investment if a project was not successful. Should such an event
occur, our income and funds available for distribution would be adversely
affected.
BECAUSE REAL ESTATE INVESTMENTS ARE ILLIQUID, WE MAY NOT BE ABLE TO SELL
PROPERTIES WHEN APPROPRIATE. Real estate investments generally can not be sold
quickly. Therefore, we have a limited ability to vary our portfolio promptly in
response to changes in economic or other conditions. In addition, the Internal
Revenue Code and related regulations prohibit a REIT such as us from holding
property for sale, which may affect our ability to sell properties without
adversely affecting distributions to our shareholders.
COMPETITION COULD ADVERSELY AFFECT OUR BUSINESS. We currently plan to
continue to expand, primarily through the acquisition and development of
additional office and industrial buildings, in the Chicago metropolitan area and
other midwestern markets. There are a number of office and industrial building
developers and real estate companies that compete with us in seeking properties
for acquisition, prospective tenants and land for development. All of our
properties are in developed areas where there are generally other properties of
the same type and quality. Competition from other office and industrial
properties may adversely affect our ability to attract and retain tenants,
rental rate and expenses of operation, particularly in light of the higher
vacancy rates of many competing properties which may result in lower-priced
space being available in such properties.
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GEOGRAPHIC CONCENTRATION OF OUR PROPERTIES IN THE CHICAGO METROPOLITAN AREA,
CLEVELAND, NASHVILLE, KNOXVILLE, MILWAUKEE AND COLUMBUS; LOCAL ECONOMIC
CONDITIONS. A number of factors, including the local economic climate, which
may be adversely impacted by business layoffs or downsizing, industry slowdowns,
changing demographics and other factors, and local real estate conditions, such
as oversupply of or reduced demand for office and industrial properties could
adversely affect our revenues and the values of our properties. Further, 20 of
our office properties and 42 of our industrial properties are located in the
Chicago metropolitan area. These properties represent approximately 81.5% of the
aggregate net rentable square feet of our office space and approximately 88.1%
of the aggregate net rentable square feet of our industrial space.
A material decline in the demand and/or the ability of tenants to pay rent
for office and industrial space in the Chicago metropolitan area could cause a
material decline in the demand for our office or industrial space and our cash
available for distribution. Such a decline may have a material adverse effect
greater than if we had a more geographically diverse portfolio of properties.
Because we own properties in the Cleveland, Ohio; Nashville, Tennessee;
Knoxville, Tennessee; Milwaukee, Wisconsin; and Columbus, Ohio metropolitan
areas, the local economic conditions of these areas will also affect our
business.
LEASE EXPIRATIONS AND RELETTING EXPENSES COULD ADVERSELY AFFECT OUR CASH
FLOW. Some of our existing leases contain rental rates that are higher than
recently negotiated leases. These leases, as well as our other existing and
future leases, may not be renewed or, if renewed, may be renewed at lower rental
rates. Decreases in the rental rates for our properties, the failure of tenants
to renew their leases or our failure to relet any of our net rentable space
could materially adversely affect our business and our ability to make
distributions. If we are unable to promptly relet or renew the leases for all or
a substantial portion of certain space currently leased or if the rental rates
upon such renewal or reletting is significantly lower than expected rates, our
cash flow and ability to make expected distributions to shareholders would be
adversely affected.
CAPITAL IMPROVEMENT REQUIREMENTS COULD ADVERSELY AFFECT OUR CASH FLOW. Our
properties vary in age and require regular capital improvements. If the cost of
improvements, whether required to attract and retain tenants or to comply with
governmental requirements, substantially exceeds our management's expectations,
our cash available for distribution may be reduced.
UNINSURED LOSSES COULD ADVERSELY AFFECT OUR CASH FLOW. We believe that our
properties are covered by adequate insurance provided by reputable companies,
and that our policies contain commercially reasonable deductibles and
specifications customarily carried for similar properties. Certain types of
losses, however, may be either uninsurable or not economically insurable, such
as losses due to floods, riots or acts of war, or may be insured subject to
certain limitations, such as large deductibles or copayments. If an uninsured
loss or a loss in excess of insured limits occurs, we could lose our investment
in and the cash flow from a property and may continue to be obligated on any
mortgage indebtedness or other obligations related to such property. Any such
loss could adversely affect our business and our ability to make distributions.
RISKS OF INVESTMENTS IN SECURITIES RELATED TO REAL ESTATE. We may pursue
our investment objectives through the ownership of securities of entities
engaged in the ownership of real estate. Ownership of such securities may not
entitle us to control the ownership, operation and management of the underlying
real estate. In addition, we may have no ability to control the distributions
with respect to such securities, which may adversely affect our ability to make
required distributions to shareholders. Furthermore, if we should desire to
control an issuer of securities, we may be prevented from doing so by the
limitations on the asset and gross income tests which must be satisfied in order
for us to qualify as a REIT for federal income tax purposes. See "Material
Federal Income Tax Considerations-- Taxation of Prime Group Realty Trust--REIT
Taxation" and "--Requirements for Qualification."
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We also may invest in mortgages or other debt instruments secured by real
estate, either solely as an investment or as a strategy to ultimately acquire
the underlying real estate. In general, investments in mortgages include:
- the risk that borrowers may be unable to make debt service payments or pay
principal when due;
- the risk that the value of the mortgaged property may be less than the
principal amount of the mortgage note securing such property; and
- the risk that interest rates payable on the mortgages may be lower than
our cost of funds to acquire these mortgages.
In any of these events, our Funds from Operations and our ability to make
required distributions to shareholders could be adversely affected. "Funds from
Operations" means funds from operations computed in accordance with the
resolution adopted by the Board of Governors of the National Association of Real
Estate Investment Trusts, Inc. ("NAREIT") in its March 1995 White Paper, with
the exception that we report base rents on a cash basis (i.e., based on
contractual lease terms), rather than computed on a straight-line basis in
accordance with GAAP. We believe that reporting base rents on a cash basis will
result in a more accurate presentation of our actual operating activities. Thus,
we calculate Funds from Operations as follows:
- net income (loss), computed in accordance with GAAP except that base rents
are reported on a cash basis as described above;
- adjusted for the exclusion of any gains (or losses) from debt
restructuring and sales of real property;
- plus the amortization of any assumed lease liabilities;
- plus real estate related depreciation and amortization, excluding
amortization of deferred financing costs; and
- adjusted for any unconsolidated partnerships, joint ventures and minority
interests.
CHANGES IN LAWS AND PROPERTY TAX RATES COULD ADVERSELY AFFECT OUR FINANCIAL
CONDITION. Costs resulting from changes in real estate laws and property taxes
generally may be passed through to our tenants and in those cases should not
adversely affect us. Increases in taxes on income, services or transfers,
however, generally are not passed through to tenants and may adversely affect
our results of operations and our ability to make distributions to shareholders.
Similarly, changes in laws increasing the potential liability for environmental
conditions existing on properties or increasing the restrictions on discharges
or other conditions, may result in significant unanticipated expenditures, which
could adversely affect our ability to make distributions to shareholders.
CHANGES IN POLICY AND INVESTMENT ACTIVITY WITHOUT SHAREHOLDER APPROVAL
WE CAN CHANGE CERTAIN POLICIES WITHOUT SHAREHOLDER APPROVAL. Our board of
trustees determines our policies relating to the following matters:
- investing and financing;
- acquisitions;
- developments;
- expansions;
- capitalization;
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- distributions; and
- operations.
Although our board of trustees has no present intention to do so, it may amend
or revise these and other policies without a vote of our shareholders. Change in
these policies could adversely affect our financial condition or results of
operations. We cannot, however, change our policy of seeking to maintain our
qualification as a REIT for federal income tax purposes without the approval of
the holders of at least a majority of the outstanding common shares.
WE CAN ENGAGE IN INVESTMENT ACTIVITY WITHOUT SHAREHOLDER APPROVAL. In the
future, we expect to acquire and develop additional real estate assets pursuant
to our investment strategies and consistent with our investment policies. Our
shareholders are not entitled to receive historical financial statements
regarding, or to vote on, any such activities. Instead, shareholders will be
required to rely entirely on the decisions of management.
DEPENDENCE ON KEY PERSONNEL. We depend on the efforts of certain of our
executive officers and trustees, particularly Mr. Reschke, our chairman of the
board, and Mr. Curto, our president and chief executive officer, for strategic
business direction and experience in the Chicago metropolitan area and other
real estate markets. While we believe that we could find replacements for these
key personnel, the loss of their services could have an adverse effect on our
operations. We have employment agreements with each of Messrs. Reschke and
Curto.
DEPENDENCE ON SIGNIFICANT TENANTS
GENERAL. Any of the following events with regard to any of our significant
tenants would disproportionately and materially adversely affect our revenues
and cash available for distribution to shareholders:
- the bankruptcy or insolvency of the tenant;
- a downturn in the business of the tenant;
- the nonrenewal of a lease by the tenant; or
- the renewal of a lease by the tenant on terms less favorable than those
contained in the expiring lease.
BANKRUPTCY AND FINANCIAL CONDITION OF TENANTS COULD ADVERSELY AFFECT OUR
CASH FLOW. At any time, any of our tenants may seek the protection of the
bankruptcy laws, which could result in the rejection and termination of the
tenant's lease and cause a reduction in our cash available for distribution. It
is possible that some tenants will file for bankruptcy protection in the future
and, if so, that they will not affirm their leases and continue to make rental
payments in a timely manner. In addition, tenants from time to time may
experience downturns in their business which may weaken their financial
condition and result in the failure to make rental payments when due, which may
adversely affect our cash flow and our ability to make expected distributions to
our shareholders.
MANAGED PROPERTY BUSINESSES AND NON-REIT SERVICES
OUR LACK OF CONTROL OVER THE SERVICES COMPANY COULD ADVERSELY AFFECT OUR
BUSINESS. We receive substantially all of the economic benefit of the business
carried on by the Services Company because the operating partnership receives
interest on a $4.8 million promissory note issued by the Services Company and
has the right to receive dividends on the Services Company's preferred stock,
all of which is owned by the operating partnership. In addition, the operating
partnership has provided a $5.0 million line of credit to the Services Company.
However, we are not able to elect directors or officers of the Services Company
because Messrs. Reschke and Curto own all of the Services
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Company's outstanding common stock. Therefore, we cannot directly influence the
operations of the Services Company or require that the Services Company's board
of directors declare and pay a cash dividend on the preferred stock held by the
operating partnership. As a result, the board of directors and management of the
Services Company may implement business policies or decisions that would not
have been implemented by entities controlled by us. These policies or decisions
could be adverse to our interests or lead to adverse financial results, which
could adversely impact our net operating income and cash flow. See "About Prime
Group Realty Trust--Services Company."
TAX LIABILITIES AND ADVERSE CONSEQUENCES OF REIT STATUS ON THE BUSINESS OF
THE SERVICES COMPANY. The Services Company is subject to federal and state
income tax on its taxable income at regular corporate rates. Certain
requirements for REIT qualification may in the future limit our ability to
receive increased distributions from the Services Company without jeopardizing
our qualification as a REIT. See "--Adverse Consequences if We Fail to Qualify
as a REIT; Other Tax Liabilities."
LIABILITIES FOR ENVIRONMENTAL MATTERS COULD ADVERSELY AFFECT OUR FINANCIAL
CONDITION. Federal, state and local laws and regulations relating to the
protection of the environment may require a current or previous owner or
operator of real estate to investigate and clean up hazardous or toxic
substances at such property. The owner or operator may have to pay a
governmental entity or third parties for property damage and for investigation
and clean-up costs incurred by such parties in connection with the
contamination. These laws often impose liability without regard to whether the
owner or operator was responsible for, or even knew of, the presence of these
hazardous or toxic substances. The costs of investigation, removal or
remediation of these substances may be substantial. The presence of these
substances may adversely affect the owner's or operator's ability to rent or
sell such property or to borrow using the property as collateral and may expose
such owner or operator to liability resulting from any release of or exposure to
such substances. Persons who arrange for the disposal or treatment of hazardous
or toxic substances at another location also may be liable for the costs of
removal or remediation of such substances at the disposal or treatment facility,
whether or not the facility is owned or operated by such person.
Certain environmental laws also impose liability for release of
asbestos-containing materials into the air. Third parties may also seek recovery
from owners or operators of real properties for personal injury associated with
asbestos-containing materials and other hazardous or toxic substances. Because
of our ownership (direct or indirect), operation, management and development of
real properties, we may be considered an owner or operator of such properties or
as having arranged for the disposal or treatment of hazardous or toxic
substances. As a result, we may be potentially liable for removal or remediation
costs, as well as certain other related costs, including governmental penalties
and injuries to persons and property.
It is possible that future laws, ordinances or regulations may impose
material environmental liabilities upon us. In addition, the current
environmental condition of our properties could be affected by tenants, by the
condition of land or operations in the vicinity of our properties, such as the
presence of underground storage tanks, or by third parties unrelated to us. Our
ability to make expected distributions to shareholders could be adversely
affected if our expenditures for compliance with the various laws and
regulations, present and future, exceeds our estimates of such items.
OTHER REGULATIONS COULD ADVERSELY AFFECT OUR FINANCIAL CONDITION. Our
properties also are subject to various federal, state and local regulatory
requirements, such as state and local fire and safety requirements. Failure to
comply with these requirements could result in the imposition of fines by
governmental authorities or awards of damages to private litigants. We believe
that the properties are currently in material compliance with all such
regulatory requirements. There can be no assurance, however, that these
requirements will not be changed or that new requirements will not be imposed
which would require significant unanticipated expenditures which could have an
adverse effect on our Funds from Operations and expected distributions.
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USE OF PROCEEDS
Unless otherwise indicated in an accompanying prospectus supplement, we
intend to use the net proceeds from the sale of the securities offered by this
prospectus, which we refer to collectively as the "securities", for general
trust purposes, including, but not limited to, capital expenditures, acquisition
or development of additional properties, repayment of indebtedness, repurchases
of our common shares and meeting our working capital needs.
RATIOS OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED SHARE DISTRIBUTIONS
The following table details our consolidated historical ratios of earnings
to combined fixed charges and preferred share distributions for the three months
ended March 31, 1999 and 1998, the year ended December 31, 1998 and for the
period from November 17, 1997 through December 31, 1997 and the properties
contributed to us by PGI for the period from January 1, 1997 through November
16, 1997 and for the years ended December 31, 1996, 1995 and 1994. We refer to
these contributed properties collectively as the "Predecessor."
<TABLE>
<CAPTION>
US--HISTORICAL PREDECESSOR--HISTORICAL
- -------------------------------------------------------- ------------------------------------------------------
PERIOD FROM PERIOD FROM
THREE MONTHS YEAR ENDED NOVEMBER 17, JANUARY 1, 1997 YEAR ENDED DECEMBER 31,
ENDED MARCH 31, DECEMBER 31, 1997 THROUGH THROUGH
- ---------------------- --------------- DECEMBER 31, NOVEMBER 16, -------------------------------------
1999 1998 1998 1997 1997 1996 1995 1994
- --------- ----- --------------- --------------- --------------- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C>
1.26 1.59 1.48 1.50 -- -- -- --
</TABLE>
The ratios of earnings to combined fixed charges and preferred share
distributions were computed by dividing earnings by combined fixed charges and
preferred share distributions. For this purpose, earnings consist of income
(loss) before minority interest, plus combined fixed charges. Combined fixed
charges consist of interest expense, amortization of debt issuance costs, and
preferred share requirements. The Predecessor's historical earnings were
insufficient to cover fixed charges by approximately $29.1 million, $31.4
million, $29.6 million and $22.1 million for the period from January 1, 1997
through November 16, 1997 and for the years ended December 31, 1996, 1995 and
1994, respectively.
GENERAL DESCRIPTION OF THE OFFERED SECURITIES
We may use this prospectus to offer common shares, preferred shares,
depositary shares, share purchase contracts, senior debt securities,
subordinated debt securities, warrants to purchase common shares, warrants to
purchase preferred shares, warrants to purchase depositary shares and warrants
to purchase debt securities (collectively, the "securities"), or any combination
of the foregoing, either individually or as units consisting of two or more such
securities. The aggregate offering price of our securities will not exceed
$500,000,000. If securities offered by this prospectus are offered as units, the
terms of the units will be set forth in a related prospectus supplement.
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DESCRIPTION OF OUR SHARES OF BENEFICIAL INTEREST
We were formed as a real estate investment trust under the laws of the State
of Maryland. Rights of shareholders are governed by Title 8 of the Corporations
and Associations Article, Annotated Code of Maryland (the "Maryland REIT Law")
and certain provisions of the Maryland General Corporation Law (the "MGCL") and
by our declaration of trust and our bylaws. The following summary of the terms
of our shares of beneficial interest does not purport to be complete and is
subject to and qualified in its entirety by reference to our declaration of
trust, the two Articles Supplementary to our declaration of trust relating to
our 9% Series B Cumulative Redeemable Preferred Shares of Beneficial Interest,
par value $0.01 per share and having a liquidation value of $25.00 per share,
and our bylaws, forms of which are filed or incorporated by reference as
exhibits to the registration statement of which this prospectus is a part.
AUTHORIZED SHARES
Our declaration of trust provides that we may issue up to 100.0 million
common shares, par value $0.01 per share, 65.0 million shares of Excess Shares,
par value $0.01 per share ("Excess Shares"), and 30.0 million preferred shares,
par value $0.01 per share. Our declaration of trust designated 2.0 million
preferred shares as 7% Series A Cumulative Convertible Preferred Shares of
Beneficial Interest. Articles Supplementary designated up to 4.6 million of the
preferred shares as redeemable preferred shares. Subsequent Articles
Supplementary reclassified 600,000 of those 4.6 million redeemable preferred
shares as authorized but unissued preferred shares. Excess Shares are to be
issued automatically upon any automatic conversion of common shares or preferred
shares which are purported to be held, transferred or acquired by any person in
violation of the ownership limitations contained in the declaration of trust.
See "--Restrictions on Ownership and Transfer." On June 4, 1999, there were
15,135,727 common shares issued and outstanding, 2.0 million convertible
preferred shares issued and outstanding and 4.0 million redeemable preferred
shares issued and outstanding.
Under the Maryland REIT law, a shareholder is not liable for our obligations
solely as a result of his or her status as a shareholder. Our declaration of
trust provides that no shareholder is liable for any of our debts or obligations
by reason of being a shareholder.
REDEEMABLE PREFERRED SHARES
RANK AND DIVIDENDS. Our redeemable preferred shares rank senior to our
outstanding convertible preferred shares and common shares as to the payment of
dividends and as to the distribution of our assets upon liquidation, dissolution
or winding up. Subject to the preferential rights of the holders of any
preferred shares that rank senior in the payment of dividends to the redeemable
preferred shares, the holders of the redeemable preferred shares are entitled to
receive, when, as and if declared by the board of trustees, out of available
funds, cumulative preferential dividends payable in cash in an amount per
redeemable preferred share equal to an annual rate of $2.25 per redeemable
preferred share.
Dividends on the redeemable preferred shares begin to accrue and are fully
cumulative from the date of original issuance whether or not we have available
funds. The dividends are payable quarterly, when, as and if declared by our
board of trustees, in arrears on the last day of each January, April, July and
October.
No dividends (other than stock dividends) will be disclosed or made or set
apart for payment on any of our shares of beneficial interest that rank junior
as to dividend rights to the redeemable preferred shares (such as the
convertible preferred shares and the common shares) and no repurchases or
redemptions of such junior shares may be made if we have not paid or set apart
for payment all of the cumulative dividends on the redeemable preferred shares
and any other class or series of preferred shares that rank on a parity with the
redeemable preferred shares.
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LIQUIDATION PREFERENCE. If we are liquidated, dissolved or wound up,
whether voluntarily or involuntarily, the holders of the redeemable preferred
shares will be entitled to receive a liquidation preference of $25.00 per
redeemable preferred share, plus an amount equal to all dividends accrued and
unpaid to the date of final distribution. This distribution is subject to the
prior preferences and other rights of any shares ranking senior to the
redeemable preferred shares upon our liquidation, distribution or winding up,
and will be made before any distribution of assets is made to holders of
convertible preferred shares, common shares or any other shares ranking junior
to the redeemable preferred shares as to liquidation rights.
REDEMPTION. On and after June 5, 2003, we have the option to redeem the
redeemable preferred shares, in whole or in part, out of available funds for
$25.00 per redeemable preferred share, plus all accumulated, accrued and unpaid
dividends, if any, without interest, to the redemption date. The redemption
price of the redeemable preferred shares, other than any portion consisting of
accrued and unpaid dividends, will be paid solely from the proceeds from our
issuance and sale of other of our capital shares. For purposes of the preceding
sentence, "capital shares" means any equity securities, both common and
preferred shares, interests, participations, or other ownership interests
(however designated) and any rights, other than debt securities convertible into
or exchangeable for equity securities, or options to purchase any of the
foregoing.
If full cumulative dividends on the redeemable preferred shares and any
other class of our shares that are on a parity with the redeemable preferred
shares as to dividends have not been declared and paid or set apart for payment:
- we may not redeem the redeemable preferred shares in part; and
- we may not purchase or acquire redeemable preferred shares, other than
pursuant to a purchase or exchange offer made on the same terms to all
holders of redeemable preferred shares.
VOTING RIGHTS. Holders of our redeemable preferred shares do not have any
voting rights, except in the following instances. First, whenever dividends on
any of our redeemable preferred shares, or other shares on a parity with the
redeemable preferred shares as to dividends, have been in arrears for six or
more consecutive quarterly periods, then the holders of such shares may vote for
the election of two additional trustees. This voting right will terminate when
all dividends in arrears on the redeemable preferred shares and the other shares
on a parity with the redeemable preferred shares (as discussed above) have been
paid and the then current quarterly dividend is also declared and paid or set
apart for payment. When this voting right is terminated, the term of office of
the additional trustees will also terminate.
Second, as long as any redeemable preferred shares are outstanding, in
addition to any other vote or consent of shareholders required by law or by the
declaration of trust, the affirmative vote of at least 66 2/3% of the votes
entitled to be cast by the holders of our redeemable preferred shares is
necessary for us to:
- amend, alter or repeal of any provision of the declaration of trust in a
manner that materially and adversely affects the voting powers, rights or
preferences of the holders of the redeemable preferred shares, or
- effect a share exchange that affects the redeemable preferred shares, a
consolidation with or merger of us into another entity, or a consolidation
with or merger of another entity into us, unless in each case each
redeemable preferred share will remain outstanding without a material and
adverse change to its terms and rights or will be converted into or
exchanged for cumulative redeemable preferred shares of the surviving
entity having terms identical to those of the redeemable preferred shares,
except for changes that do not materially and adversely affect the holders
of the redeemable preferred shares.
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HOWEVER, no vote of the holders of redeemable preferred shares will be
required if, at or prior to the time either of the two circumstances discussed
above occur, we make provision for the redemption of all outstanding redeemable
preferred shares to the extent the redemption is authorized.
In other words, the affirmative vote of the holders of at least 66 2/3% of
the redeemable preferred shares will be required to permit us to issue any
preferred shares having rights senior to the redeemable preferred shares as to
dividend payments or as to liquidation rights but no vote is required to permit
us to issue preferred shares having rights junior to, or on a parity with, the
redeemable preferred shares as to dividend payments or as to liquidation rights.
Each redeemable preferred share will have one vote per share. However, when
any other series of preferred shares has the right to vote with the redeemable
preferred shares as a single class on any matter, then the redeemable preferred
shares and other series will have one vote per $25.00 of stated liquidation
preference with respect to such matters.
GENERAL. The redeemable preferred shares have no stated maturity. Except as
otherwise described in "--Restrictions on Ownership and Transfer," the
redeemable preferred shares are not convertible into or exchangeable for any
other of our property or securities and will not be subject to any sinking fund
or mandatory redemption provisions.
The redeemable preferred shares have traded on the NYSE since June 23, 1998
under the symbol "PGE PrB."
CONVERTIBLE PREFERRED SHARES
RANK AND DIVIDENDS. Our convertible preferred shares rank senior to our
outstanding common shares as to payment of dividends and as to the distribution
of assets upon liquidation, dissolution or winding up. Subject to the
preferential rights of the holders of any preferred shares, including the
redeemable preferred shares, that rank senior in the payment of dividends to the
convertible preferred shares, the holders of the convertible preferred shares
are entitled to receive, when, as and if declared by the board of trustees, out
of funds legally available for the payment of dividends, cumulative preferential
dividends payable in cash in an amount per convertible preferred share equal to
the greater of:
- $1.50 per year; and
- the regular cash dividends on the common shares, or portion thereof, into
which a convertible preferred share is convertible. These dividends will
equal the number of common shares, or portion thereof, into which a
convertible preferred share will be convertible (as described below under
"--Conversion"), multiplied by the most current quarterly dividend on a
common share on or before the convertible preferred share dividend payment
date.
Dividends on the convertible preferred shares accrue and are fully
cumulative from the date of original issuance, whether or not we have funds
available for the payment of the dividends. Dividends are payable quarterly,
when, as and if declared by our board of trustees, in arrears on either:
- the date on which we pay the dividends on the common shares; or
- if we do not pay a common share dividend in any quarterly dividend period,
the date our board of trustees sets.
No dividends (other than stock dividends) will be declared or made or set
apart for payment on any of our shares of capital stock that rank junior as to
dividend rights to the convertible preferred shares (such as the common shares)
and no repurchases or redemptions of such junior shares may be made if we have
not paid or set apart for payment all of the cumulative dividends on the
convertible
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preferred shares and any other class or series of preferred shares that rank on
a parity with the convertible preferred shares.
LIQUIDATION PREFERENCE. If we are liquidated, dissolved or wound up,
whether voluntarily or involuntarily, the holders of the convertible preferred
shares will be entitled to receive a liquidation preference of $20.00 per
convertible preferred share, plus an amount equal to all dividends accrued and
unpaid to the date of final distribution to such holders. This distribution is
subject to the prior preferences and other rights of any shares ranking senior
to our convertible preferred shares upon our liquidation, dissolution or winding
up, such as our redeemable preferred shares, and will be made before any
distribution of assets is made to holders of common shares or any other shares
ranking junior to our convertible preferred shares as to liquidation rights.
REDEMPTION. Except under limited circumstances as set forth in the
declaration of trust, we may not redeem the convertible preferred shares prior
to November 17, 2007. On and after November 17, 2007, we have the option to
redeem the convertible preferred shares for cash, in whole or in part, out of
available funds at a redemption price of $20.00 per convertible preferred share,
plus all accumulated, accrued and unpaid dividends, if any, without interest to
the redemption date.
If full cumulative dividends on our convertible preferred shares, and any
other shares on a parity with our convertible preferred shares as to dividends,
have not been declared and paid or set apart for payment:
- we may not redeem the convertible preferred shares in part; and
- we may not purchase or acquire convertible preferred shares, other than
pursuant to a purchase or exchange offer made on the same terms to all
holders of convertible preferred shares.
In April 1999, the sole holder of the convertible preferred shares was
granted the right to redeem its shares at a price of $20.00 per share, upon 120
days prior written notice. This redemption may occur during the period beginning
January 15, 2002 and ending January 15, 2004. This right of redemption was
granted by us for the reason discussed below under "--Limitation of Issuance of
Additional Preferred Shares and Indebtedness."
CONVERSION. A holder of convertible preferred shares has the right to
convert all or any portion of those shares into common shares at the conversion
price of $20.00 per common share. The number of common shares issuable upon
conversion and the conversion price are subject to adjustment as set forth in
our declaration of trust.
LIMITATION OF ISSUANCE OF ADDITIONAL PREFERRED SHARES AND INDEBTEDNESS. Our
declaration of trust states that without the written consent of the holders of
66 2/3% of the issued and outstanding convertible preferred shares, none of us,
the operating partnership or any of our or its subsidiaries may issue any
additional preferred securities or incur any indebtedness if, immediately
following the issuance and the application of the net proceeds of the issuance,
the entity would be reasonably expected to not satisfy either both of (i) a
total debt and liquidation value of non-convertible preferred shares to total
market capitalization ratio of less than .65 to 1.0 (the "Market Cap Ratio"), or
(ii) a consolidated EBITDA to consolidated fixed charges ratio of at least 1.4
to 1.0 (each ratio as more fully set forth in our declaration of trust). The
preceding limitation does not apply to the ability to incur trade payables or
accrued expenses incurred in the ordinary course of business. Subject to the
contractual modification discussed in the following paragraph, if the entity
fails to satisfy one or both of those ratios for two consecutive quarters, the
holders of convertible preferred shares will have the right to require that we
repurchase any or all of each holder's convertible preferred shares at a $20.00
per share repurchase price payable in cash, subject to adjustment, plus accrued
and unpaid dividends whether or not declared, if any to the repurchase date.
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In April 1999, we, our operating partnership and the sole holder of the
convertible preferred shares entered into an agreement that contractually
modified the terms of the convertible preferred shares. The agreement eliminated
the Market Cap Ratio discussed above. In exchange, the sole holder of the
convertible preferred shares was granted the redemption right discussed above.
See "--Redemption."
VOTING RIGHTS. Holders of our convertible preferred shares do not have any
voting rights except in the following instances. First, whenever dividends on
any of our convertible preferred shares or other shares on a parity with our
convertible preferred shares as to dividends, have been in arrears for two or
more consecutive quarterly periods, or if we do not pay dividends on our common
shares of at least $0.3375 per share for two consecutive quarterly dividend
periods, then the holders of our convertible preferred shares and the holders of
the shares ranking on a parity with our convertible preferred shares may vote
for the election of one additional trustee. This voting right will terminate
when:
- all dividends in arrears on our convertible preferred shares and the other
shares on a parity with them, as discussed above, have been paid and the
then current quarterly dividend is also declared and paid or set apart for
payment; or
- we have paid a common share dividend of at least $0.3375 per share for two
consecutive quarters.
When this voting right is terminated, the term of office of the additional
trustee will also terminate.
Second, as long as any convertible preferred shares are outstanding, in
addition to any other vote or consent of shareholders required by law or by our
declaration of trust, the affirmative vote of at least 66 2/3% of the votes
entitled to be cast by the holders of our convertible preferred shares is
necessary for us to:
- amend, alter or repeal any provision of our declaration of trust in a
manner that materially and adversely affects the voting powers, rights or
preferences of the holders of the convertible preferred shares; or
- effect a share exchange that affects our convertible preferred shares, a
consolidation with or merger of us into another entity, or a consolidation
with or merger of another entity into us, unless in each case each
convertible preferred share will remain outstanding without a material and
adverse change to its terms and rights or will be converted into or
exchanged for convertible preferred shares of the surviving entity having
terms identical to those of the convertible preferred shares (except for
changes that do not materially and adversely affect the holders of the
convertible preferred shares).
HOWEVER, no vote of the holders of convertible preferred shares will be
required if, at or prior to the time the two circumstances discussed above
occur, we make provision for the redemption of all outstanding convertible
preferred shares to the extent such redemption is authorized.
In other words, the affirmative vote of the holders of at least 66 2/3% of
the convertible preferred shares will be required to permit us to issue any
outstanding preferred shares having rights senior to the convertible preferred
shares as to dividend payments outstanding or as to liquidation rights.
Each convertible preferred share will have one vote per share. However, when
any other series of preferred shares will have the right to vote with the
convertible preferred shares as a single class on any matter, then the
convertible preferred shares and such other series will have one vote per $20.00
of stated liquidation preference with respect to such matters.
REGISTRATION RIGHTS. We have granted the sole holder of the convertible
preferred shares registration rights with respect to any common shares acquired
by it upon conversion of their convertible preferred shares into common shares.
Pursuant to these rights, we have prepared and filed a registration statement
with the Securities and Exchange Commission. We cannot predict how the sale
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of any common shares by such holders pursuant to the registration statement, or
the perception that such sales could occur, will affect the market price of any
common shares offered pursuant to this prospectus and an applicable prospectus
supplement.
GENERAL. The convertible preferred shares are not entitled to the benefit
of any sinking fund. The convertible preferred shares are not listed or
qualified for trading on any exchange or on the Nasdaq National Market.
The preceding summaries of the terms of the redeemable preferred shares and
convertible preferred shares are qualified in their entirety by reference to our
declaration of trust and Articles Supplementary.
ISSUANCE OF ADDITIONAL PREFERRED SHARES
Our board of trustees has the authority to issue up to an additional 24.0
million preferred shares from time to time, in one or more series, without any
further action by our shareholders, subject to the rights of the holders of our
redeemable preferred shares and our convertible preferred shares. The following
description of our preferred shares of beneficial interest, $0.01 par value per
share, sets forth general terms and provisions of the preferred shares to which
any prospectus supplement may relate. The statements below describing the
preferred shares are in all respects subject to and qualified in their entirety
by reference to our declaration of trust, bylaws and any applicable amendment to
the declaration of trust designating terms of a series of preferred shares (a
"Designating Amendment"). The preferred shares, when issued, will be fully paid
and non-assessable. Because our board of trustees has the power to establish the
preferences, powers and rights of each series of preferred shares, it may afford
the holders of any series of preferred shares preferences, powers and rights,
voting or otherwise, senior to the rights of holders of common shares. The
issuance of additional series of preferred shares could have the effect of
delaying or preventing a change of control that might involve a premium price
for shareholders or otherwise be in their best interest.
The rights, preferences, privileges and restrictions of the preferred shares
of each series will be fixed by the Designating Amendment relating to the
series. A prospectus supplement, relating to each series, will specify the terms
of the preferred shares, as follows:
- the title and stated value of the preferred shares;
- the number of preferred shares offered, the liquidation preference per
share and the offering price of the preferred shares;
- the dividend rate(s), period(s) and/or payment date(s) or method(s) of
calculation applicable to the preferred shares;
- the date from which dividends on the preferred shares will accumulate, if
applicable;
- the procedures for any auction and remarketing, if any, for the preferred
shares;
- the provision for a sinking fund, if any, for the preferred shares;
- the provision for redemption, if applicable, of the preferred shares;
- any listing of the preferred shares on any securities exchange;
- the terms and conditions, if applicable, upon which the preferred shares
will be convertible into our common shares, including the conversion price
(or manner of calculation) and conversion period;
- whether interests in the preferred shares will be represented by
Depositary Shares;
- any other specific terms, preferences, rights, limitations or restrictions
of the preferred shares;
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- a discussion of certain material federal income tax considerations
applicable to the preferred shares;
- the relative ranking and preferences of the preferred shares as to
dividend rights and rights upon the liquidation, dissolution or winding up
of our affairs;
- any limitation on issuance of any series of preferred shares ranking
senior to or on a parity with the series of preferred shares as to
dividend rights and rights upon the liquidation, dissolution or winding up
of our affairs; and
- any limitations on direct or beneficial ownership and restrictions on
transfer of the preferred shares, in each case as may be appropriate to
preserve our status as a REIT.
COMMON SHARES
DIVIDENDS AND LIQUIDATION RIGHTS. Subject to the preferential rights of the
convertible preferred shares, redeemable preferred shares and any other class or
series of shares of beneficial interest and to the provisions of our declaration
of trust regarding the Excess Shares and convertible preferred shares and
redeemable preferred shares, holders of common shares will be entitled to
receive distributions on such shares if authorized and declared by our board of
trustees and to share ratably in our assets legally available for distribution
to the shareholders in the event of our liquidation, dissolution or winding-up
after payment of, or adequate provision for, all our known debts and
liabilities. We currently pay quarterly distributions on the common shares,
which quarterly distributions commenced with the partial quarter ending December
31, 1997 and currently intend to continue to pay quarterly distributions.
Subject to the provisions of our declaration of trust regarding Excess
Shares, common shares will have equal dividend, distribution, liquidation and
other rights, and will have no preference, appraisal (except as provided by
Maryland law) or exchange rights.
VOTING RIGHTS. Subject to the provisions of our declaration of trust
regarding Excess Shares, our convertible preferred shares and our redeemable
preferred shares, each outstanding common share entitles the holder to one vote
on all matters submitted to a vote of the common shareholders. These matters
include the election of trustees and, except as otherwise required by law or
except as provided with respect to any preferred shares, the holders of such
shares will possess exclusive voting power. There is no cumulative voting in the
election of trustees. This means that the holders of a majority of the
outstanding common shares can elect all of the trustees then standing for
election, and the holders of the remaining shares will not be able to elect any
trustees.
Pursuant to Maryland REIT Law, a Maryland real estate investment trust
generally cannot dissolve, amend its declaration of trust or merge, unless
approved by the affirmative vote or written consent of shareholders holding at
least two-thirds of the shares entitled to vote on the matter unless the trust's
declaration of trust sets forth a lower percentage, but always more than 50%.
Our declaration of trust contains such a provision providing for a lower
percentage, a majority of outstanding shares, with respect to transactions
pursuant to which our assets will be combined with those of one or more other
entities. Such a transaction could include a merger, sale or other transfer of
assets, consolidation or share exchange.
GENERAL. Holders of the common shares have no conversion, sinking fund,
redemption rights, exchange rights or preemptive rights to subscribe for any of
our securities.
The transfer agent and registrar for the common shares is LaSalle National
Bank.
The common shares have traded on the NYSE since November 12, 1997 under the
trading symbol "PGE."
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COMMON SHARE REPURCHASE PROGRAM. On September 14, 1998, we established a
program to repurchase up to 1.55 million of our common shares in open market and
privately negotiated transactions. As of June 4, 1999, we had repurchased
474,200 common shares for an aggregate purchase price of approximately $7.3
million. We are currently not repurchasing common shares.
RESTRICTIONS ON OWNERSHIP AND TRANSFER
Our declaration of trust contains restrictions on the number of our shares
of beneficial interest that shareholders may own. For us to qualify as a REIT
under the Internal Revenue Code no more than 50.0% in value of our outstanding
shares of beneficial interest may be owned, actually or constructively under the
applicable attribution rules of the Internal Revenue Code, by five or fewer
individuals during the last half of a taxable year, other than the first year
for which the election to be taxed as a REIT has been made, or during a
proportionate part of a shorter taxable year (the "five or fewer requirement").
Pension plans and mutual funds are among the entities that are not treated as
holders of stock or beneficial interests under the five or fewer requirement and
instead the beneficial owners of the entities are counted as holders for this
purpose. Our shares of beneficial interest must also be owned by 100 or more
persons during at least 335 days of a taxable year of 12 months or during a
proportionate part of a shorter taxable year.
In general, the Ownership Limit set forth in our declaration of trust
provides that no person or entity may own, or be deemed to own by virtue of the
applicable constructive ownership provisions of the Internal Revenue Code, more
than 9.9%, of our outstanding shares of beneficial interest, including the
common shares, convertible preferred shares and redeemable preferred shares (the
"Equity Shares"). The 9.9% limitation applies to the number or value of our
Equity Shares, whichever is more restrictive. The constructive ownership rules
of the Internal Revenue Code are complex, and may cause Equity Shares owned
actually or constructively by a group of related individuals and/or entities to
be deemed to be constructively owned by one individual or entity.
Our board of trustees may, but in no event will be required to, waive the
Ownership Limit or any other limit provided in our declaration of trust with
respect to a particular shareholder if our board of trustees determines that the
shareholder's ownership will not jeopardize our status as a REIT and our board
of trustees otherwise decides such action would be in our best interest. As a
condition of such waiver, our board of trustees must obtain a ruling from the
IRS or an opinion of counsel satisfactory to it with respect to preserving our
REIT status. In accordance with these provisions, we have waived the Ownership
Limit with respect to the Equity Shares to permit Security Capital Preferred
Growth Incorporated to own, at any one time, up to 16%, in value or number, of
the total outstanding Equity Shares. Additionally, we have waived the Ownership
Limit to permit Long Leaf Partners Realty Fund to purchase 3.0 million common
shares.
Our declaration of trust further prohibits any person from actually or
constructively owning our shares of beneficial interest that would result in us
being "closely held" under Section 856(h) of the Internal Revenue Code or
otherwise cause us to fail to qualify as a REIT. In addition, no person may
transfer any of our shares of beneficial interest if such transfer would result
in our shares of beneficial interest being owned by fewer than 100 persons.
Any person who acquires or attempts or intends to acquire actual or
constructive ownership of our shares of beneficial interest that will or may
violate any of the restrictions on transferability of ownership discussed above
is required to give notice immediately to us. They must also provide us with any
other information as we may request in order to determine the effect of such
transfer on our status as a REIT.
If any purported transfer of our Equity Shares or any other event would
otherwise result in any person violating the Ownership Limit or such other limit
as provided in the declaration of trust, then any such purported transfer will
be void and of no force or effect with respect to the purported
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transferee (the "Prohibited Transferee") as to that number of shares in excess
of the Ownership Limit or such other limit as provided in the declaration of
trust. The Prohibited Transferee will acquire no right or interest in such
excess shares. Any excess shares described above will be converted automatically
into an equal number of Excess Shares (the "Shares-in-Trust") and transferred
automatically, by operation of law, to a trust (the "Share Trust"), the
beneficiary of which will be selected by us (the "Beneficiary"). Such automatic
transfer will be deemed to be effective as of the close of business on the
business day prior to the date of such violative transfer.
At any time after the expiration of a 90-day period which commences upon the
receipt of notice from us of the transfer of Shares-in-Trust to the Share Trust
and during which we will have the right to purchase such Shares-in-Trust, the
trustee of the Share Trust will have the right to sell such Shares-in-Trust to a
person or entity who could own such shares without violating the Ownership Limit
or such other limit as provided in the declaration of trust. The trustee of the
Share Trust, who will be designated by us and be unaffiliated with us or any
Prohibited Transferee, will then distribute to the Prohibited Transferee an
amount equal to the lesser of the price paid by the Prohibited Transferee for
such Shares-in-Trust or the sales proceeds received by the Share Trust for such
Shares-in-Trust. In the case of any Shares-in-Trust issued as a result of any
event other than a transfer, or from a transfer for no consideration, such as a
gift, the trustee will be required to sell such Shares-in-Trust to a qualified
person or entity and distribute to the Prohibited Transferee an amount equal to
the lesser of the market price of such Shares-in-Trust as of the date of such
event or the sales proceeds received by the trust for such Shares-in-Trust. In
either case, any proceeds in excess of the amount distributable to the
Prohibited Transferee will be distributed to the Beneficiary.
Prior to a sale of any such Shares-in-Trust by the Share Trust, the trustee
will be entitled to receive, in trust for the Beneficiary, all dividends and
other distributions paid by us with respect to such Shares-in-Trust. It will be
entitled to exercise all voting rights with respect to such Shares-in-Trust.
Subject to Maryland law, effective as of the date that such Shares-in-Trust have
been transferred to the Share Trust:
- any vote cast by a Prohibited Transferee prior to the discovery by us that
such Shares-in-Trust have been transferred to the Share Trust will be void
and of no force or effect; and
- the trustee will have the authority to recast such vote in accordance with
the desires of the trustee acting for the benefit of the Beneficiary.
Any dividend or other distribution inadvertently paid to the Prohibited
Transferee will be required to be repaid to the trustee for distribution to the
Beneficiary.
In addition, Shares-in-Trust held in the Share Trust will be deemed to have
been offered for sale to us at a price per share equal to the lesser of:
- the price per share in the transaction that resulted in such transfer to
the Share Trust, or in the case of a gift, the market price at the time of
the gift; and
- the market price on the date we accept such offer.
We will have the right to accept such offer for a period of 90 days.
If any attempted transfer of Equity Shares would cause our shares of
beneficial interest to be beneficially owned by fewer than 100 persons, such
transfer will be null and void in its entirety and the intended purchaser or
recipient will acquire no rights to Equity Shares.
The restrictions on transferability and ownership discussed above will not
apply if our board of trustees determines that it is no longer in our best
interest to attempt to qualify, or to continue to qualify, as a REIT and such
determination is approved by an affirmative vote of two-thirds of the votes
entitled to be cast on such matter at a regular or special meeting of our
shareholders. Except as
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otherwise described above, any change in the Ownership Limit would require an
amendment to our declaration of trust. Generally, amendments to the declaration
of trust require the affirmative vote of holders owning at least two-thirds of
our shares of beneficial interest outstanding and entitled to vote thereon.
All certificates representing our Equity Shares currently bear a legend
referring to the restrictions described above.
If the transfer restrictions discussed above are determined to be void or
invalid by virtue of any legal decision, statute, rule or regulation, then the
intended transferee of any Excess Shares may be deemed, at our option, to have
acted as agent on our behalf in acquiring such Excess Shares and to hold such
Excess Shares on our behalf.
Under our declaration of trust, every owner of more than 5%, or a lower
percentage as required by the Internal Revenue Code or Treasury Regulations, of
our outstanding Equity Shares must file, within 30 days after January 1 of each
year, a written notice with us containing information regarding their ownership
of such shares. Under current Treasury Regulations, the percentage will be set
between one-half of 1% and 5%, depending upon the number of record holders of
our shares. Further, each shareholder must upon demand disclose to us in writing
any information we may request in order to determine the effect, if any, of such
shareholder's actual and constructive ownership of Equity Shares on our status
as a REIT.
The ownership limitations discussed above may have the effect of precluding
acquisition of our control without the consent of our board of trustees and,
consequently, shareholders may be unable to realize a premium for their shares
over the then-prevailing market price which is customarily associated with such
acquisitions and to ensure compliance with the Ownership Limit, or such other
limit as provided in our declaration of trust.
These restrictions will not preclude settlement for transactions through the
NYSE.
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DESCRIPTION OF DEBT SECURITIES
The following description of the Debt Securities sets forth general terms
and provisions of the Debt Securities to which any prospectus supplement may
relate ("Offered Debt Securities"). The particular terms of the Offered Debt
Securities and the extent to which those general provisions may apply will be
described in a prospectus supplement relating to those Offered Debt Securities.
Unless otherwise specified in the applicable prospectus supplement, the Debt
Securities will constitute our senior, senior subordinated or subordinated,
including, if applicable, junior subordinated, debt. They will be issued under a
Senior Debt Indenture (the "Senior Debt Indenture") or a Subordinated Debt
Indenture (the "Subordinated Debt Indenture"). Bankers Trust Company, or its
successor (the "Trustee"), will serve as the trustee under the Senior Debt
Indenture and under the Subordinated Debt Indenture. The Senior Debt Indenture
and the Subordinated Debt Indenture are sometimes referred to below individually
as an "Indenture" and collectively as the "Indentures." If and to the extent set
forth in the applicable prospectus supplement, the Debt Securities may be
convertible into our preferred shares or common shares or issued as part of
Units of Debt Securities and other securities. If Debt Securities are to be
issued as part of Units of Debt Securities and other securities or are to be
issued in exchange for preferred shares or warrants to purchase Debt Securities,
the prospectus supplement will describe any applicable material federal income
tax consequences.
The following summaries of some provisions of the Indentures and the Debt
Securities do not purport to be complete. These summaries include
cross-references to some of the Indenture provisions, to assist you in reviewing
the Indentures. The cross references are indicated by parentheses and refer to
numbered sections of the applicable Indenture. Capitalized terms not defined
below have the meanings given to them in the Indentures. Except to the extent
set forth in the prospectus supplement with respect to a particular issue of
Debt Securities, the Indentures are substantially identical, except for certain
covenants and the provisions relating to subordination, including the fact that
Senior Debt Securities will rank senior to the Subordinated Debt Securities.
GENERAL
The Indentures will not limit the amount of additional debt we or any of our
subsidiaries may incur, except as may be provided in the applicable prospectus
supplement. The Debt Securities will be our senior or subordinated obligations,
as set forth in the applicable prospectus supplement.
The applicable prospectus supplement will contain the following terms of,
and information relating to, any Debt Securities, to the extent such terms are
applicable to such Debt Securities and have not been otherwise disclosed:
- the specific title, aggregate principal amount, denomination and form;
- the date of maturity;
- the interest rate or rates, or the method by which such rate will be
determined, if any;
- the date from which interest will accrue, the dates on which any such
interest will be payable and the record date for any interest payable on
the interest payment date;
- if other than the corporate trust office of the trustee for such Debt
Securities, the place or places where the principal of, premium, if any,
and interest, if any, on the Debt Securities will be payable;
- the portion of the principal amount of Debt Securities of the series
payable upon certain declarations of acceleration or the method by which
such portion shall be determined;
- the currency, currencies or currency unit in which payments will be made,
if other than U.S. dollars;
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- whether the Debt Securities are senior or subordinated Debt Securities;
- any redemption, repayment or sinking fund provisions, including the period
or periods within which, the currency, currencies or currency units in
which and the other terms and conditions upon which Debt Securities may be
redeemed;
- whether the Debt Securities are convertible or exchangeable into common
shares or preferred shares and the terms of the security into which they
are convertible or exchangeable (see "Description of Our Shares of
Beneficial Interest-Redeemable Preferred Shares", "--Convertible Preferred
Shares" and "--Common Shares"), the conversion or exchange price, other
terms related to conversion or exchange, whether such conversion or
exchange is mandatory or at the option of the holder or us, and any
anti-dilution protections;
- whether the Debt Securities will be sold as part of Units consisting of
Debt Securities and other securities;
- whether the Debt Securities are to be issued upon the exchange of debt
warrants, and if so, the time, manner and place for such Debt Securities
to be authenticated or declared;
- if the amount of payments of principal of or any premium or interest on
any Debt Securities of the series may be determined with reference to an
index, formula or other method, the index, formula or other method by
which such amounts shall be determined;
- whether and by what method the Debt Securities of the series, or certain
covenants under the related Indenture, may be defeased and discharged by
us;
- whether the Debt Securities of the series shall be issued in whole or in
part as book-entry securities;
- whether any material provisions of the applicable Indenture described in
this prospectus do not apply to the Debt Securities;
- any applicable material federal income tax consequences; and
- any other material specific terms of the Debt Securities not inconsistent
with the provisions of the Indentures, including any material additional
events of default or covenants provided for with respect to the Debt
Securities and any material terms that may be required by or advisable
under applicable laws or regulations.
Debt Securities may bear interest at a fixed rate or a floating rate. Debt
Securities:
- bearing no interest; or
- bearing interest at a rate that at the time of issuance is below the
prevailing market rate; or
- as part of Units consisting of Debt Securities and other securities
may be sold or deemed to be sold at a discount below their stated principal
amount ("Original Issue Discount Securities"). With respect to any Debt
Securities as to which we have the right to defer interest, the holders of such
Debt Securities may be allocated interest income for federal and state income
tax purposes without receiving equivalent, or any, interest payments. Any
material federal income tax considerations applicable to any of these discounted
Debt Securities or to some Debt Securities issued at par that are treated as
having been issued at a discount for federal income tax purposes will be
described in the applicable prospectus supplement.
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SUBORDINATION OF SUBORDINATED DEBT SECURITIES
Any Subordinated Debt Securities will be subordinate and junior in right of
payment, to the extent and in the manner to be set forth in the Indenture, to
all of our "Senior Debt." "Senior Debt" means, without duplication, the
principal, premium (if any) and unpaid interest on all our present and future:
- indebtedness for borrowed money;
- obligations evidenced by bonds, debentures, notes or similar instruments;
- indebtedness incurred, assumed or guaranteed by us in connection with the
acquisition by us or a subsidiary of any business, properties or assets,
except purchase-money indebtedness classified as accounts payable under
generally accepted accounting principles;
- obligations as lessee under leases required to be capitalized on the
balance sheet of the lessee under generally accepted accounting
principles;
- reimbursement obligations in respect of letters of credit relating to our
indebtedness or other obligations that qualify as indebtedness or
obligations of the kind referred to in the clauses above; and
- obligations under direct or indirect guarantees in respect of, and
obligations (contingent or otherwise) to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in the clauses above;
in each case unless in the instrument creating or evidencing the indebtedness or
obligation, or pursuant to which the same is outstanding, it is provided that
such indebtedness or obligation is not superior in right of payment to Senior
Debt Securities.
CERTAIN COVENANTS
PAYMENT OF TAXES AND OTHER CLAIMS. The Indentures generally require us to
pay or discharge or cause to be paid or discharged, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges levied or
imposed upon us or any subsidiary or upon our income, profits or property or
that of any subsidiary and (ii) all lawful claims for labor, materials and
supplies which, if unpaid, might by law become a lien upon any of our properties
or the properties of any subsidiary. We are not required to comply with this
covenant if the tax, assessment, charge or claim is one whose amount,
applicability or validity is being contested in good faith or which is not
material to our and our subsidiaries' business operations, financial conditions
or results of operations taken as a whole. (Senior Debt Indenture and
Subordinated Debt Indenture Section 1004).
MAINTENANCE OF PROPERTIES. The Indentures generally require us to cause all
of our material properties used or useful in the conduct of our business or the
business of any subsidiary to be maintained and kept in good condition, repair
and working order, all as in our judgment may be necessary so that the business
carried on in connection therewith may be properly and advantageously conducted
at all times. We and our subsidiaries are not prevented from selling or
otherwise disposing of our or their properties for value in the ordinary course
of business. (Senior Debt Indenture and Subordinated Debt Indenture Section
1005).
EXISTENCE. The Indentures generally require us to do or cause to be done
all things necessary to preserve and keep in full force and effect our real
estate investment trust existence, rights and franchises unless we deem the
right or franchise no longer desirable in our business. (Senior Debt Indenture
and Subordinated Debt Indenture Section 1006).
INSURANCE. The Indentures require us to cause each of our and our
subsidiaries' insurable properties to be insured in a commercially reasonable
amount against loss or damage with insurers of
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recognized responsibility and, if described in the applicable prospectus
supplement, in specified amounts and with insurers having a specified rating
from a recognized insurance rating service. (Senior Debt Indenture Section 1011;
Subordinated Debt Indenture Section 1009).
ADDITIONAL COVENANTS. We refer you to the applicable prospectus supplement
for information with respect to any additional covenants specific to a
particular series of Debt Securities.
REDEMPTION
If and to the extent set forth in the applicable prospectus supplement, we
will have the right to redeem the Debt Securities, in whole or from time to time
in part, after the date and at the redemption prices set forth in the applicable
prospectus supplement.
EVENTS OF DEFAULT
An Event of Default with respect to the Debt Securities of any series is
defined in the Indentures as:
- our failure to pay principal of or premium, if any, on any Debt Security
of that series at maturity;
- our failure for 30 days to pay interest on any Debt Security of that
series;
- our failure for 30 days to make the deposit of any sinking fund payment
when due in respect of the terms of that series;
- our failure in the performance, or breach of any other of the covenants or
warranties in the Indentures continued for 60 days after due notice by the
Trustee or by holders of at least 25% in principal amount of the
Outstanding Debt Securities of that series;
- certain events of bankruptcy, insolvency or reorganization; or
- any other Event of Default provided with respect to Debt Securities of
that series. (Senior Debt Indenture and Subordinated Debt Indenture
Section 501)
The Indentures provide that, if any Event of Default with respect to Debt
Securities of any series at the time outstanding occurs and is continuing,
either the Trustee or the holders of not less than 25% in principal amount of
the Outstanding Debt Securities of that series may declare the principal amount
(or, if the Debt Securities of that series are Original Issue Discount
Securities or Indexed Securities as defined in the Indentures, such portion of
the principal amount of such Debt Securities as may be specified in the terms
thereof) of all Debt Securities of that series to be due and payable
immediately. Upon some conditions as more fully set forth in the Indentures, the
declaration may be annulled and past defaults may be waived by the holders of a
majority in principal amount of the Outstanding Debt Securities of that series
on behalf of the holders of all Debt Securities of that series. However, unless
previously cured, defaults in payment of principal of or premium, if any, or
interest, if any, on the Debt Securities of that series and some other defaults
set forth in the Indentures may not be waived. (Senior Debt Indenture and
Subordinated Debt Indenture Sections 502 and 513).
Reference is made to the prospectus supplement relating to each series of
Debt Securities which are Original Issue Discount Securities for the particular
provisions relating to acceleration of the Maturity of a portion of the
principal amount of such Original Issue Discount Securities upon the occurrence
of an Event of Default and its continuation.
The Indentures provide that a Responsible Officer of the Trustee will,
within 90 days after the occurrence of a default with respect to Debt Securities
of any series at the time Outstanding, give to the Holders of the Outstanding
Debt Securities of that series notice of such default of which the Responsible
Officer has actual knowledge if uncured or not waived. However, except regarding
default
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in the payment of principal of or premium, if any, or interest on any Debt
Security of that series, or in the deposit of any sinking fund payment which is
provided for, this notice will not be given until 30 days after the occurrence
of a default with respect to Outstanding Debt Securities of such series. The
term default with respect to any series of Outstanding Debt Securities for the
purpose of this provision only means the happening of any of the Events of
Default specified in the Indenture and relating to such series of Outstanding
Debt Securities, excluding any grace periods and irrespective of any notice
requirements. (Senior Debt Indenture and Subordinated Debt Indenture Section
602).
The Indentures contain a provision entitling the Trustee, subject to the
duty of the Trustee during default to act with the required standard of care, to
be indemnified by the holders of any series of Outstanding Debt Securities
before proceeding to exercise any right or power under the Indenture at the
request of the holders of such series of Debt Securities. (Senior Debt Indenture
and Subordinated Debt Indenture Section 603). The Indentures provide that the
holders of a majority in principal amount of Outstanding Debt Securities of any
series, after notice and request made to the Trustee, may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or other power conferred on the Trustee, with
respect to the Debt Securities of such series, provided that the Trustee may
decline to act if such direction is contrary to law or the Indentures or would
expose it to personal liability. (Senior Debt Indenture and Subordinated Debt
Indenture Section 512).
DEFEASANCE OF DEBT SECURITIES OR CERTAIN COVENANTS IN CERTAIN CIRCUMSTANCES
DEFEASANCE AND DISCHARGE. Unless otherwise provided in the applicable
prospectus supplement, the terms of any series of Debt Securities will provide
that we will be discharged from any and all obligations in respect of the Debt
Securities of such series upon the deposit with the Trustee, in trust, of money
and/or U.S. Government Obligations which, through the payment of interest and
principal thereof in accordance with their terms, will provide money in an
amount sufficient to pay and discharge the principal of (and premium, if any)
and interest on, and any mandatory sinking fund payments applicable to, the Debt
Securities of such series on the stated maturity of such payments in accordance
with the terms of the Indenture and such Debt Securities. This discharge may
only occur if, among other things, we have delivered to the Trustee an opinion
of counsel indicating that we have received from, or there has been published
by, the United States Internal Revenue Service a ruling, or there has been a
change in tax law, in either case to the effect that such a discharge will not
be deemed, or result in, a taxable event with respect to holders of the Debt
Securities of such series. This discharge of obligations is not applicable to
certain obligations to register the transfer or exchange of Debt Securities of
such series, to replace stolen, lost or mutilated Debt Securities of such
series, to maintain paying agencies and to hold moneys for payment in trust.
(Article Thirteen of the Senior Debt Indenture; Article Fifteen of the
Subordinated Debt Indenture).
DEFEASANCE OF CERTAIN COVENANTS. Unless otherwise provided in the
applicable prospectus supplement, the terms of any series of Debt Securities
will provide us with the option to omit to comply with some restrictive
covenants, including those described in Sections 801, 1007 and 1008 of the
Senior Debt Indenture and Article 13 of the Subordinated Debt Indenture. In
order to exercise this option, we will be required to deposit with the Trustee
money and/or U.S. Government Obligations, which, through the payment of interest
and principal in accordance with their terms, will provide money in an amount
sufficient to pay the principal of (and premium, if any) and interest on, and
mandatory sinking fund payments applicable to the Debt Securities of such series
on the stated maturity of such payments in accordance with the terms of the
Indentures and such Debt Securities. We will also be required to deliver to the
Trustee an opinion of counsel to the effect that the deposit and related
covenant defeasance will not cause the holders of the Debt Securities of such
series to recognize income, gain or loss for federal income tax purposes. In the
event we exercise this option and the Debt Securities of such series are
declared due and payable because of the occurrence of any Event
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of Default, the amount of money and U.S. Government Obligations, as the case may
be, on deposit with the Trustee will be sufficient to pay amounts due on the
Debt Securities of such series at the time of their Stated Maturity but may not
be sufficient to pay amounts due on the Debt Securities of such series at the
time of the acceleration resulting from such Event of Default. However, we will
remain liable for those payments.
The applicable prospectus supplement will state if any defeasance provision
will apply to Debt Securities offered in connection with it.
MODIFICATION OF THE INDENTURE AND WAIVER OF COVENANTS
The Indentures contain provisions permitting us and the applicable Trustee,
with the consent of the holders of not less than a majority in principal amount
of Outstanding Debt Securities of each series affected thereby, to execute
supplemental indentures with respect to:
- adding any provisions to or changing or eliminating any of the provisions
of the Indentures; or
- modifying the rights of the holders of Outstanding Debt Securities of such
series.
However, no such supplemental indenture may, without the consent of the
holder of each Outstanding Debt Security affected thereby:
- change the Stated Maturity, or reduce the principal amount, the premium,
if any, or the rate of payment of interest, of any Debt Security of any
series;
- reduce the percentage of Outstanding Debt Securities of any series, as
discussed above, the consent of the holders of which is required for any
supplemental indenture or for waiver of compliance with certain provisions
of or certain defaults under, the applicable Indenture; or
- effect certain other changes. (Senior Debt Indenture and Subordinated Debt
Indenture Section 902).
The Indentures also permit us to omit compliance with some covenants in the
Indentures with respect to Debt Securities of any series upon waiver by the
holders of a majority in principal amount of Outstanding Debt Securities of such
series.
The Indentures contain provisions which permit us and the Trustee, without
the consent of any holders of Outstanding Debt Securities, to execute
supplemental indentures with respect to (among other things):
- fixing any ambiguity, defect or inconsistency in such Indenture; or
- changing any provision that does not materially adversely affect the
interests of any holders of such series of Debt Securities. (Senior Debt
Indenture and Subordinated Debt Indenture Section 901).
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Indentures contain a provision permitting us, without the consent of the
holders of any of the Outstanding Debt Securities under the Indenture, to
consolidate with or merge into any other entity or transfer or lease our assets
substantially as an entirety to any entity or person provided that:
- the successor is an entity organized under the laws of any domestic
jurisdiction;
- the successor assumes our obligations on the Debt Securities and under the
Indentures;
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- after giving effect to the transaction, no Event of Default, and no event
which, after notice or lapse of time, would become an Event of Default,
will have happened and be continuing; and
- certain other conditions are met. (Senior Debt Indenture and Subordinated
Debt Indenture Sections 801 and 802)
CONCERNING THE TRUSTEE
Bankers Trust Company is the Trustee under both the Senior Debt Indenture
and the Subordinated Debt Indenture.
GOVERNING LAW
Unless otherwise specified in the applicable prospectus supplement, the
Indentures for the Debt Securities will be governed by New York law, except to
the extent that the Trust Indenture Act shall be applicable.
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DESCRIPTION OF DEPOSITARY SHARES
GENERAL
The following summary of each of the Deposit Agreement, the Depositary
Shares and the Depositary Receipts, each as defined below, does not purport to
be complete and is qualified in its entirety by reference to the Deposit
Agreement and Depositary Receipts with respect to the Depositary Shares relating
to any particular series of preferred shares, the forms of which are filed as,
or will be incorporated by reference as, exhibits to the registration statement
of which this prospectus is a part in connection with the issuance of such
Depositary Shares.
The following summary of the Deposit Agreement, the Depositary Shares and
the Depositary Receipts relates to terms and conditions applicable to such
securities generally. The particular terms of any series of Depositary Shares
will be described in the applicable prospectus supplement. If so indicated in
the prospectus supplement, the terms of any such series may differ from the
terms set forth below.
We may, at our option, elect to offer fractional interests in preferred
shares, rather than preferred shares. If we elect to do so, we will provide for
the issuance by a Depositary (as described below) to the public of receipts for
Depositary Shares. Each of these Depositary Shares will represent a fractional
interest of a preferred share, the specific interest to be set forth in the
applicable prospectus supplement.
The preferred shares underlying any Depositary Shares will be deposited
under a separate Deposit Agreement (each, a "Deposit Agreement") between us and
a bank or trust company selected by us with respect to such preferred shares.
This bank or trust company will have its principal office in the United States
and have a combined capital and surplus of at least $50,000,000 (with respect to
such preferred shares, the "Depositary"). The applicable prospectus supplement
relating to a series of Depositary Shares will set forth the name and address of
the Depositary. Subject to the terms of the applicable Deposit Agreement, each
owner of a Depositary Share will be entitled, in proportion to the applicable
fractional interest in a preferred share underlying such Depositary Share, to
all the rights, preferences or privileges of such preferred shares (including
dividend, voting, redemption, conversion, exchange and liquidation rights).
Depositary Shares will be evidenced by depositary receipts issued pursuant
to the applicable Deposit Agreement (the "Depositary Receipts").
DIVIDENDS
The Depositary will distribute all cash dividends or other cash
distributions received by the Depositary in respect of the preferred shares to
the record holders of Depositary Shares relating to such preferred shares in
proportion to the respective numbers of such Depositary Shares held by such
holders on the relevant record date. However, if we or the Depositary is
required to withhold and does withhold from any cash dividend or other cash
distribution an amount on account of taxes, the amount made available for
distribution will be reduced accordingly. The Depositary will distribute only
such amount, however, as can be distributed without attributing to any holder of
Depositary Shares a fraction of one cent. Any balance not so distributed will be
added to and treated as part of the following distribution to record holders of
such Depositary Shares.
In the event of a distribution other than in cash, the Depositary will
distribute securities or property received by it to the record holders of
Depositary Shares entitled thereto in proportion to the respective numbers of
such Depositary Shares held by such holders on the relevant record date, unless
the Depositary determines that it is not feasible to make such distribution. In
that case, the Depositary may, with our approval, adopt such method as it deems
equitable and practicable for the purpose of effecting such distribution,
including the public or private sale of such securities or property. The net
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proceeds from any such sale will then be distributed to the holders as provided
in the case of a cash distribution.
Each Deposit Agreement will also contain provisions relating to the manner
in which any subscription or similar rights offered by us to holders of the
preferred shares of the applicable series will be made available to holders of
Depositary Shares.
WITHDRAWAL OF SHARES
Upon surrender of Depositary Receipts at the Depositary's office, unless the
related Depositary Shares have previously been called for redemption, the holder
of the Depositary Shares evidenced by the Depositary Receipts will be entitled
to delivery at such office, to or upon such holder's order, of the number of
whole shares of the related series of preferred shares and all money and other
property, if any, underlying such Depositary Shares. Holders of Depositary
Shares will be entitled to receive whole shares of the related series of
preferred shares on the basis set forth in the applicable prospectus supplement.
However, holders of such whole preferred shares will not thereafter be entitled
to deposit such preferred shares or to receive receipts evidencing Depositary
Shares therefor. If the Depositary Receipts delivered by the holder evidence a
number of Depositary Shares in excess of the number of Depositary Shares
representing the number of whole shares of the related series of preferred
shares to be withdrawn, the Depositary will deliver to such holder or upon such
holder's order at the same time a new Depositary Receipt evidencing such excess
number of Depositary Shares.
REDEMPTION OF DEPOSITARY SHARES
The terms, if any, on which the Depositary Shares relating to the preferred
shares of any series may be redeemed will be set forth in the applicable
prospectus supplement.
VOTING OF UNDERLYING PREFERRED SHARES
Upon receipt of notice of any meeting at which the holders of the preferred
shares of any series are entitled to vote, the applicable Depositary will mail
the information contained in such notice of meeting to the record holders of the
Depositary Shares relating to such series of preferred shares. Each record
holder of such Depositary Shares on the record date, which will be the same date
as the record date for the preferred shares, will be entitled to instruct the
Depositary as to the exercise of the voting rights pertaining to the number of
preferred shares underlying such holder's Depositary Shares. The Depositary will
endeavor, insofar as practicable, to vote the number of whole preferred shares
underlying such Depositary Shares in accordance with such instructions. We will
agree to take all action that may be deemed necessary by the Depositary in order
to enable the Depositary to do so. To the extent the Depositary does not receive
specific instructions from the holders of Depositary Shares relating to such
preferred shares, it will abstain from voting such preferred shares, unless
otherwise indicated by the holders of such Depositary Shares.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the applicable Deposit Agreement may at any time be amended by
agreement between us and the Depositary. However, no amendment that materially
and adversely alters the rights of the existing holders of Depositary Shares
will be effective unless such amendment has been approved by the record holders
of at least a majority of the Depositary Shares then outstanding. A Deposit
Agreement may be terminated by us or the Depositary only if:
- all outstanding Depositary Shares relating to it have been redeemed and
any accumulated and unpaid dividends on the preferred shares represented
by the Depositary Shares, together with all
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other moneys and property, if any, to which holders of Depositary Receipts
are entitled, have been paid or distributed;
- all preferred shares have been withdrawn; or
- there has been a final distribution in respect of the preferred shares of
the applicable series in connection with our liquidation, dissolution or
winding up and such distribution has been distributed to the holders of
Depositary Receipts.
CHANGES OF PREFERRED SHARE DEPOSITARY
We will pay all transfer and other taxes and governmental charges arising
solely from the existence of any depositary arrangements. We will pay all
charges of each Depositary in connection with the initial deposit of the
preferred shares of any series, any redemption of such preferred shares and any
withdrawals of such preferred shares by holders of Depositary Shares. Holders of
Depositary Shares will be required to pay any other transfer and other taxes and
governmental charges and such other charges as are expressly provided in the
Deposit Agreement to be for their accounts.
RESIGNATION AND REMOVAL OF DEPOSITARY
A Depositary may resign at any time by delivering to us notice of its
election to do so. We may at any time remove a Depositary. Such resignation or
removal will take effect upon the appointment of a successor Depositary and its
acceptance of such appointment. Such successor Depositary must be appointed
within 60 days after delivery of the notice of resignation or removal and must
be a bank or trust company having its principal office in the United States and
having a combined capital and surplus of at least $50,000,000.
MISCELLANEOUS
Each Depositary will forward to the holders of the applicable Depositary
Shares all notices, reports and communications from us which are delivered to
such Depositary and which we are required to furnish the holders of the
Depositary Receipts or preferred shares of the applicable series.
Neither any Depositary nor we will be liable if it or we are prevented or
delayed by law or any circumstance beyond its or our control in performing its
or our obligations under any Deposit Agreement. Neither any Depositary nor we
will assume any obligation or be subject to any liability under any Deposit
Agreement other than for its or our negligence or willful misconduct. They will
not be obligated to prosecute or defend any legal proceeding in respect of any
Depositary Shares or preferred shares unless indemnity satisfactory to them is
furnished. The Depositary will agree to perform its duties as are specifically
set forth in the Deposit Agreement using its reasonable best efforts and in good
faith. We or any Depositary may rely upon written advice of counsel or
accountants, or information provided by persons presenting preferred shares for
deposit, holders of Depositary Shares or other persons believed by us or it to
be competent and on documents believed by us or them to be genuine.
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DESCRIPTION OF WARRANTS
We have no outstanding warrants to purchase common shares ("Common Share
Warrants"), warrants to purchase preferred shares ("Preferred Share Warrants"),
warrants to purchase Depository Shares ("Depository Share Warrants") and
warrants to purchase Debt Securities ("Debt Securities Warrants"). Common Share
Warrants, Preferred Share Warrants, Depository Share Warrants and Debt
Securities Warrants are referred to collectively as the "Warrants". We may issue
Warrants for the purchase of preferred shares, common shares, Depository Shares
or Debt Securities. Warrants may be issued independently or together with any
other securities offered by any prospectus supplement and may be attached to or
separate from those securities. Each series of Warrants will be issued under a
separate warrant agreement (each, a "Warrant Agreement") to be entered into
between us and a warrant agent specified in a prospectus supplement (the
"Warrant Agent"), the form of which will be filed or incorporated by reference
as an exhibit to the registration statement of which this prospectus forms a
part. The Warrant Agent will act solely as our agent in connection with the
Warrants of such series and will not assume any obligation or relationship of
agency or trust for or with any provisions of the Warrants offered hereby.
Further terms of the Warrants and the applicable Warrant Agreements will be set
forth in the applicable prospectus supplement relating to the issuance of any
Warrants.
The applicable prospectus supplement will describe the terms of the Warrants
in respect of which this prospectus is being delivered including, where
applicable, the following:
- the title of the Warrants;
- the aggregate number of the Warrants;
- the price or prices at which the Warrants will be issued;
- the designation, terms and number of common shares, preferred shares,
Depositary Shares or Debt Securities purchasable upon exercise of the
Warrants;
- the designation and terms of the securities, if any, with which the
Warrants are issued and the number of the Warrants issued with each such
offered security;
- the date, if any, on and after which the Warrants and the related
preferred shares, common shares, Depositary Shares or Debt Securities will
be separately transferable;
- the price at which each common share, preferred share, Depositary Share or
Debt Security purchasable upon exercise of the Warrants may be purchased;
- the date on which the right to exercise the Warrants shall commence and
the date on which the right shall expire;
- the minimum or maximum amount of the Warrants which may be exercised at
any one time;
- information with respect to book-entry procedures, if any;
- a discussion of certain material federal income tax considerations; and
- any other terms of the Warrants, including terms, procedures and
limitations relating to the exchange and exercise of the Warrants.
The exercise of any Warrants will be subject to and limited by the transfer and
ownership restrictions in our declaration of trust. See "Description of Our
Shares of Beneficial Interest--Restrictions on Ownership and Transfer."
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DESCRIPTION OF SHARE PURCHASE CONTRACTS
AND SHARE PURCHASE UNITS
GENERAL
Unless otherwise specified in the applicable prospectus supplement, we may
issue share purchase contracts ("Share Purchase Contracts"), including contracts
obligating holders to purchase from us, and us to sell to the holders, a
specified number of common shares or preferred shares at a future date or dates.
The consideration per common share or preferred share may be fixed at the time
the Share Purchase Contracts are issued or may be determined by a specific
reference to a formula set forth in the Share Purchase Contracts. The Share
Purchase Contracts may be issued separately or as part of Units ("Share Purchase
Units") consisting of a Share Purchase Contract and Debt Securities, Preferred
Securities or debt obligations of third parties, including U.S. Treasury
securities, securing the holders' obligations to purchase common shares or
preferred shares under the Share Purchase Contracts. The Share Purchase
Contracts may require us to make periodic payments to the holders of the Share
Purchase Units or vice versa. These payments may be unsecured or prefunded on
some basis. The Share Purchase Contracts may require holders to secure their
obligations thereunder in a specified manner.
PLEDGED SECURITIES AND PLEDGE AGREEMENT
The securities related to the Share Purchase Contracts (collectively, the
"Pledged Securities") will be pledged to a collateral agent (the "Collateral
Agent"), for our benefit, pursuant to the Pledge Agreement to secure the
obligations of holders of Share Purchase Contracts to purchase common shares or
preferred shares under the related Share Purchase Contracts. The rights of
holders of Share Purchase Contracts to the related Pledged Securities will be
subject to our security interest therein created by the related pledge
agreement. No holder of Share Purchase Contracts will be permitted to withdraw
the Pledged Securities related to the Share Purchase Contracts from the pledge
arrangement except upon the termination or early settlement of the related Share
Purchase Contracts. Subject to such security interest and the terms of the
Purchase Contract Agreement and the pledge agreement, the forms of which will be
filed or incorporated by reference as exhibits to the registration statement of
which this prospects forms a part, each holder of a Share Purchase Contract will
retain full beneficial ownership of the related Pledged Securities.
DISTRIBUTIONS
Except as described in the applicable prospectus supplement, the Collateral
Agent will, upon receipt of distributions on the Pledged Securities, distribute
such payments to us or the Purchase Contract Agent, as provided in the pledge
agreement. The Purchase Contract Agent will in turn distribute payments it
receives as provided in the Purchase Contract Agreement.
The applicable prospectus supplement will describe the terms of any Share
Purchase Contracts or Share Purchase Units, the forms of which will be filed or
incorporated by reference as exhibits to the registration statement of which
this prospects forms a part. The description in the prospectus supplement will
not necessarily be complete and will be qualified in its entirety by reference
to the Share Purchase Contracts, and, if applicable, collateral arrangements and
depositary arrangements, relating to such Share Purchase Contracts or Share
Purchase Units.
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DESCRIPTION OF GLOBAL SECURITIES
Unless otherwise specified in the applicable prospectus supplement,
securities offered hereby, other than common shares and preferred shares, will
be issued in the form of one or more book-entry certificates (collectively, with
respect to each series or issue of securities, the "Global Securities")
registered in the name of a depositary or a nominee of a depositary. Unless
otherwise specified in the applicable prospectus supplement, the depositary will
be The Depository Trust Company ("DTC"). We have been informed by DTC that its
nominee will be Cede & Co. ("Cede"). Accordingly, Cede is expected to be the
initial registered holder of all securities that are issued in book-entry form.
No person that acquires a beneficial interest in such securities will be
entitled to receive a certificate representing that person's interest in the
securities except as set forth in this prospectus or in the applicable
prospectus supplement. Unless and until definitive securities are issued under
the limited circumstances described below, all references to actions by holders
of securities issued in book-entry form shall refer to actions taken by DTC upon
instruction from its Participants (as defined below), and all references in this
prospectus to payments and notices to holders shall refer to payments and
notices to DTC or Cede, as the registered holder of such securities.
DTC has informed us that it is a limited purpose trust company organized
under the New York Banking Law, a "banking organization" within the meaning of
the New York Banking Law, a member of the Federal Reserve System, a "clearing
company" within the meaning of the New York Uniform Commercial Code and a
"clearing agency" registered pursuant to Section 17A of the Exchange Act. It has
also informed us that it was created to hold securities for its participating
organizations ("Participants") and to facilitate the clearance and settlement of
securities transactions among Participants through electronic book-entry,
thereby eliminating the need for physical movement of certificates. Participants
include securities brokers and dealers, banks, trust companies and clearing
corporations, and may include certain other organizations. Indirect access to
the DTC system also is available to others such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
Participant, either directly or indirectly ("Indirect Participants").
Persons that are not Participants or Indirect Participants but desire to
purchase, sell or otherwise transfer ownership of, or other interests in,
securities may do so only through Participants and Indirect Participants. Under
a book-entry format, Holders may experience some delay in their receipt of
payments, as such payments will be forwarded by the agent designated by us to
Cede, as nominee for DTC. DTC will forward such payments to its Participants,
which then will forward them to Indirect Participants or Holders. Holders will
not be recognized by the applicable registrar, transfer agent, Trustee,
Depositary or Warrant Agent as registered holders of the securities entitled to
the benefits of the Certificate or the applicable Indenture, Deposit Agreement
or Warrant Agreement. Beneficial owners that are not Participants will be
permitted to exercise their rights as such only indirectly through and subject
to the procedures of Participants and, if applicable, Indirect Participants.
Under the rules, regulations and procedures creating and affecting DTC and
its operations as currently in effect (the "Rules"), DTC will be required to
make book-entry transfers of securities among Participants and to receive and
transmit payments to Participants. Participants and Indirect Participants with
which beneficial owners of securities have accounts with respect to the
securities similarly are required by the Rules to make book-entry transfers and
receive and transmit such payments on behalf of their respective account
holders.
Because DTC can act only on behalf of Participants, who in turn act only on
behalf of Participants or Indirect Participants, and on behalf of certain banks,
trust companies and other persons approved by it, the ability of a beneficial
owner of securities issued in book-entry form to pledge such securities to
persons or entities that do not participate in the DTC system, or to otherwise
act with respect to such securities, may be limited due to the unavailability of
physical certificates for such securities.
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DTC has advised us that DTC will take any action permitted to be taken by a
registered holder of any securities under our declaration of trust or the
applicable Indenture, Deposit Agreement or Warrant Agreement only at the
direction of one or more Participants to whose accounts with DTC such securities
are credited.
Unless otherwise specified in the applicable prospectus supplement, a Global
Security will be exchangeable for the relevant definitive securities registered
in the names of persons other than DTC or its nominee only if:
- DTC notifies us that it is unwilling or unable to continue as depositary
for such Global Security or if at any time DTC ceases to be a clearing
agency registered under the Exchange Act at a time when DTC is required to
be so registered in order to act as such depository and we do not appoint
a successor within 90 days;
- we execute and deliver to the applicable registrar, transfer agent,
Trustee, Depositary and/or Warrant Agent an order complying with the
requirements of our declaration of trust, the Articles Supplementary or
the applicable Indenture, Deposit Agreement and/or Warrant Agreement that
such Global Security shall be so exchangeable; or
- there has occurred and is continuing a default in the payment of any
amount due in respect of the securities or, in the case of Debt
Securities, an Event of Default or an event that, with the giving of
notice or lapse of time, or both, would constitute an Event of Default
with respect to such Debt Securities.
Any Global Security that is exchangeable pursuant to the preceding sentence will
be exchangeable for securities registered in such names as DTC directs.
Upon the occurrence of any event described in the immediately preceding
paragraph, DTC is generally required to notify all Participants of the
availability through DTC of definitive securities. Upon surrender by DTC of the
Global Security representing the securities and delivery of instructions for
re-registration, the registrar, transfer agent, Trustee, Depositary or Warrant
Agent, as the case may be, will reissue the securities as definitive securities.
Then, such persons will recognize the holders of the definitive securities as
registered holders of securities entitled to the benefits of the Certificate or
the applicable Indenture, Deposit Agreement and/or Warrant Agreement.
Except as described above, a Global Security may not be transferred except
as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another
nominee of DTC or to a successor depositary appointed by us. Except as described
above, DTC may not sell, assign, transfer or otherwise convey any beneficial
interest in a Global Security evidencing all or part of any securities unless
such beneficial interest is in an amount equal to an authorized denomination for
such securities.
We, the Trustee, any registrar and transfer agent, any Warrant Agent or any
Depositary, or any agent of any of them, will not have any responsibility or
liability for any aspect of DTC's or any Participant's records relating to, or
for payments made on account of, beneficial interests in a Global Security, or
for maintaining, supervising or reviewing any records relating to such
beneficial interests.
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MATERIAL FEDERAL INCOME TAX CONSIDERATIONS
The following discussion summarizes the material federal income tax
considerations to us resulting from the treatment of us as a REIT. Winston &
Strawn has acted as tax counsel ("Tax Counsel") to us in connection with the
offering and the preparation of this prospectus. This summary should not be
construed as tax advice.
The statements in this summary are based on current provisions of the
Internal Revenue Code, Treasury Regulations promulgated thereunder and
administrative and judicial interpretations thereof, as of the date hereof, all
of which are subject to change, possibly with retroactive effect. The provisions
of the Internal Revenue Code, the Treasury Regulations promulgated thereunder
and the relevant administrative and judicial interpretations that concern REITs
are highly technical and complex, and this summary is qualified in its entirety
by such Internal Revenue Code provisions, Treasury Regulations, and
administrative and judicial interpretations. No assurance can be given that
future legislative, judicial, or administrative actions or decisions will not
affect the accuracy of any statements in this summary. In addition, there can be
no assurance that a ruling will be sought from the Internal Revenue Service (the
"IRS") with respect to any matter discussed herein, or that the IRS or a court
will agree with the statements made herein.
This summary of Material Federal Income Tax Considerations describes our tax
treatment as a REIT. The summary describes the complex technical requirements
which we must satisfy in order to qualify as a REIT. Our failure to meet those
requirements could result in our income becoming taxable in the same manner as
any regular C Corporation i.e., any corporation subject to full corporate level
tax. The resulting tax liability to us if we failed to meet the REIT
requirements would have a significant adverse effect on an investment in the
Equity Shares. See "--Taxation of Prime Group Realty Trust--Failure to Qualify"
below. In addition, even if we do qualify as a REIT, various federal income
taxes may still be imposed on us as are described in the summary.
TAXATION OF PRIME GROUP REALTY TRUST
GENERAL
We have elected to be taxed as a REIT under Sections 856 through 860 of the
Internal Revenue Code and the applicable Treasury Regulations, which together
set forth the requirements for qualifying as a REIT (the "REIT Requirements"),
beginning with our taxable year ended December 31, 1997. We believe that we are
organized, have operated and will continue to operate in a manner to qualify for
taxation as a REIT under the Internal Revenue Code. No assurance can be given,
however, that we have actually operated in such a manner to qualify as a REIT or
will continue to operate in a manner to remain qualified as a REIT.
Subject to the qualifications described in this summary and stated in its
opinion, Tax Counsel has given us an opinion that we are organized in conformity
with the requirements for qualification as a REIT under the Internal Revenue
Code, and our method of operation has enabled us to meet the requirements for
qualification and taxation as a REIT under the Internal Revenue Code and our
method of operation enables us to continue to meet the requirements for
qualification as a REIT. An opinion of counsel is not binding on the IRS or a
court and there can be no assurance that the IRS or a court will not take a
position different from that expressed by Tax Counsel. It also must be
emphasized that Tax Counsel's opinion is based on various assumptions and is
conditioned upon numerous representations made by us and the operating
partnership as to factual matters, including those related to our and the
operating partnership's businesses and properties as set forth in this
prospectus. Tax Counsel has not independently verified our representations.
Moreover, our qualification and taxation as a REIT depend upon our ability to
meet on a continuing basis the actual operating results, distribution levels,
diversity of ownership and the various other qualification tests imposed by the
Internal Revenue Code as discussed below. Tax Counsel will not review our
compliance with these
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tests on a continuing basis. Accordingly, no assurance can be given that the
actual results of our operations for any given taxable year will satisfy the
requirements for qualification and taxation as a REIT. See "--Failure to
Qualify."
REIT TAXATION
For any taxable year in which we qualify for taxation as a REIT, we
generally will not be subject to federal corporate income tax on that portion of
our ordinary income or capital gain that is currently distributed to our
shareholders. The REIT provisions of the Internal Revenue Code generally allow a
REIT to deduct dividends paid to its shareholders in calculating its taxable
income. This deduction for dividends paid to shareholders substantially
eliminates the federal "double taxation" on earnings (once at the corporate
level and once again at the shareholder level) that generally results from an
investment in a corporation.
Even if we continue to qualify for taxation as a REIT, we may be subject to
federal income tax in the following circumstances:
- We will be taxed at regular corporate rates on any undistributed "REIT
taxable income" and undistributed net capital gains.
- In some circumstances, we may be subject to the corporate "alternative
minimum tax" on our items of tax preference, if any.
- If we have (A) net income from the sale or other disposition of
"foreclosure property" which is held primarily for sale to customers in
the ordinary course of business or (B) other nonqualifying income from
foreclosure property, we will be subject to tax on such income at the
highest regular corporate rate (currently 35%).
- If we have net income from prohibited transactions, such income will be
subject to a 100% tax. Prohibited transactions, in general, are sales or
other dispositions of property held primarily for sale to customers in the
ordinary course of business, other than foreclosure property.
- If we should fail to satisfy the 75% gross income test or the 95% gross
income test (as discussed below), but nonetheless maintain our
qualification as a REIT because we meet other requirements, we will be
subject to a 100% tax on the greater of the amount by which we fail the
75% or the 95% test, multiplied by a fraction intended to reflect our
profitability.
- If we should fail to distribute for each calendar year at least the sum of
(A) 85% of our REIT ordinary income for such year, (B) 95% of our REIT
capital gain net income for such year, and (C) any undistributed taxable
income from prior periods, we will be subject to a 4.0% excise tax on the
excess of such required distribution over the amounts actually
distributed. However, to the extent we elect to retain and pay income tax
on net long-term capital gains we received during the year such amounts
will be treated as having been distributed for purposes of the 4.0% excise
tax.
- If we acquire any asset from a C corporation, I.E., any corporation
subject to full corporate level tax, in a transaction in which the basis
of the asset in our hands is determined by reference to the basis of the
asset (or any other property) in the hands of the C corporation, and we
subsequently recognize gain on the disposition of such asset during the
ten-year period (the "Recognition Period") beginning on the date on which
the asset was acquired by us, then, pursuant to guidelines issued by the
IRS, the C corporation from which we acquired the asset will be taxable on
the amount of gain that would have been realized if the C corporation had
liquidated on the last day before the date on which we acquired the asset.
Alternatively, we may elect, in lieu of the treatment described above, to
be subject to tax at the highest regular corporate tax rate on the excess,
if any, of (A) the fair market value of the asset as of the
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beginning of the applicable Recognition Period, over (B) our adjusted
basis in such asset as of the beginning of such Recognition Period (I.E.,
"built-in gain"). We also will be taxed on any built-in gains during the
Recognition Period attributed to the disposition of assets of an acquired
corporation which is a "qualified REIT subsidiary." See "--Requirements
for Qualification-- Qualified REIT Subsidiary."
If we invest in properties in foreign countries, our profits from those
investments will generally be subject to tax in the countries where such
properties are located. The precise nature and amount of any taxation will
depend on the laws of the countries where the properties are located. If we
satisfy the annual distribution requirements for qualification as a REIT and are
therefore not subject to federal corporate income tax on that portion of our
ordinary income and capital gain that is currently distributed to our
shareholders, we will generally not be able to recover the cost of any foreign
tax imposed on profits from our foreign investments by claiming foreign tax
credits against our U.S. tax liability on such profits. Moreover, a REIT is not
able to pass foreign tax credits through to its shareholders.
We use the calendar year for both federal income tax purposes and financial
reporting purposes.
REQUIREMENTS FOR REIT QUALIFICATION
To qualify as a REIT, we must have met and continue to meet the
requirements, discussed below, relating to our organization, the sources of our
gross income, the nature of our assets, and the level of distributions to our
shareholders.
ORGANIZATIONAL REQUIREMENTS
The Internal Revenue Code requires that a REIT be a corporation, trust, or
association:
- which is managed by one or more trustees or directors;
- the beneficial ownership of which is evidenced by transferable shares or
by transferable certificates of beneficial interest;
- which would be taxable as a domestic corporation but for compliance with
the REIT requirements;
- which is neither a financial institution nor an insurance company under
the Internal Revenue Code;
- the beneficial ownership of which is held by 100 or more persons;
- at any time during the last half of each taxable year not more than 50% in
value of the outstanding stock or shares of beneficial interest of which
is owned, directly or indirectly through the application of attribution
rules, by or for five or fewer individuals (as defined in the Internal
Revenue Code to include tax-exempt entities other than, in general,
qualified domestic pension funds); and
- which meets other tests, described below, regarding the nature of its
income and assets and distribution requirements.
The Internal Revenue Code provides that the first four conditions above must
be met during the entire taxable year and that the fifth condition must be met
during at least 335 days of a taxable year of 12 months, or during a
proportionate part of a taxable year of less than 12 months. A corporation may
not elect to become a REIT unless its taxable year is a calendar year.
We have issued sufficient shares to enough holders to allow us to satisfy
the fifth condition set forth above (the "100 holder" requirement). For purposes
of determining ongoing compliance with the
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100 holder requirement, Treasury Regulations require us to issue letters to some
shareholders demanding information regarding the amount of shares each such
shareholder actually or constructively owns. Although any failure by us to
comply with the shareholder demand letters requirement should not jeopardize our
REIT status, such failure would subject us to financial penalties. A list of
those shareholders failing or refusing to comply with this demand must be
maintained as part of our records. A shareholder who fails or refuses to comply
with the demand must submit a statement with its tax return disclosing the
actual ownership of the shares and other information.
As set forth in the sixth condition above, to qualify as a REIT we must also
satisfy the requirement set forth in Section 856(a)(6) of the Internal Revenue
Code that we not be closely held. We will not be closely held so long as at all
times during the last half of any of our taxable years (other than the first
taxable year for which the REIT election is made) not more than 50% in value of
our outstanding shares of beneficial interest is owned, directly or
constructively under the applicable attribution rules of the Internal Revenue
Code, by five or fewer individuals (as defined in the Internal Revenue Code to
include tax-exempt entities, other than, in general, qualified domestic pension
funds) (the "5/50 Rule").
Although our declaration of trust contains restrictions on the ownership and
transfer of the Equity Shares, the restrictions do not ensure that we will be
able to satisfy the 5/50 Rule. If we fail to satisfy the 5/50 Rule, our status
as a REIT will terminate, and we will not be able to prevent such termination.
However, for taxable years beginning after August 5, 1997, if we comply with the
procedures prescribed in Treasury Regulations for issuing shareholder demand
letters and do not know, or with the exercise of reasonable diligence would not
have known, that the 5/50 Rule was violated, the requirement that we not be
closely held will be deemed to be satisfied for the year. See "--Failure to
Qualify."
OWNERSHIP OF A PARTNERSHIP INTEREST
In the case of a REIT that is a partner in a partnership, Treasury
Regulations provide that the REIT is deemed to own its proportionate share of
the assets of the partnership corresponding to the REIT's capital interest in
such partnership and is deemed to earn such proportionate share of the income of
the partnership. In addition, the partnership's assets and gross income retain
the same character in the hands of the REIT for purposes of the REIT
Requirements, including satisfying the gross income tests and the asset tests.
Accordingly, our proportionate share of the assets, liabilities and items of
income of the operating partnership, including the operating partnership's
proportionate share of the assets, liabilities and items of income of each of
its property-owning subsidiaries (each a "Property Partnership"), are treated as
our assets, liabilities and items of income for purposes of applying the REIT
Requirements, provided that the operating partnership and each of the Property
Partnerships are treated as partnerships for federal income tax purposes.
QUALIFIED REIT SUBSIDIARY
If a REIT owns a corporate subsidiary that is a "qualified REIT subsidiary,"
within the meaning of section 856(i) of the Internal Revenue Code, that
subsidiary is disregarded for federal income tax purposes, and all assets,
liabilities, and items of income, deduction, and credit of the subsidiary are
treated as assets, liabilities and such items of the REIT itself. A "qualified
REIT subsidiary" is a corporation all of the capital stock of which is owned by
the REIT. If an existing corporation is acquired by a REIT and becomes a
"qualified REIT Subsidiary" of such REIT, all of its pre-acquisition earnings
and profits must be distributed before the end of the REIT's taxable year. Any
corporation formed directly by us to act as a general partner in any of the
Property Partnerships will be a "qualified REIT subsidiary" and thus all of such
subsidiary corporation's assets, liabilities, and items of income, deduction,
and credit will be treated as our assets, liabilities, and items of income,
deduction and credit.
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INCOME TESTS
To maintain our qualification as a REIT, we must satisfy two gross income
requirements annually. First, at least 75% of our gross income (excluding gross
income from prohibited transactions) for each taxable year must be derived
directly or indirectly from investments relating to real property or mortgages
on real property (including "rents from real property" and, in some
circumstances, interest) or from some types of temporary investments. Second, at
least 95% of our gross income (excluding gross income from prohibited
transactions) for each taxable year must be derived from such real property
investments and from dividends, interest, and gain from the sale or disposition
of stock or securities or from any combination of the foregoing.
Rents received by us will qualify as "rents from real property" in
satisfying the gross income requirements for a REIT described above only if
several conditions are met:
- First, the amount of rent received or accrued with respect to any property
must not be based in whole or in part on the income or profits derived by
any person from such property, although an amount received or accrued
generally will not be excluded from the term "rents from real property"
solely by reason of being based on a fixed percentage or percentages of
gross receipts or gross sales. Rents received from a tenant that are based
on the tenant's income from the property will not be treated as rents
based on income or profits and thus excluded from the term "rents from
real property" if the tenant derives substantially all of its income with
respect to such property from the leasing or subleasing of substantially
all of such property, provided that the tenant receives from subtenants
only amounts that would be treated as rents from real property if received
directly by a REIT.
- Second, rents received from a tenant will not qualify as "rents from real
property" in satisfying the gross income tests if the REIT, or an owner of
10% or more of the REIT, directly or constructively owns 10% or more of
such tenant (a "Related Party Tenant").
- Third, if rent attributable to personal property, leased in connection
with a lease of real property, is greater than 15% of the total rent
received under the lease, then the portion of rent attributable to such
personal property will not qualify as "rents from real property."
- Finally, a REIT generally must not operate or manage the property or
furnish or render services to the tenants of such property, other than
through an "independent contractor" from whom the REIT derives no income.
However, we (or our affiliates) are permitted to directly perform services
that are "usually or customarily rendered" in connection with the rental
of space for occupancy only and are not otherwise considered rendered for
the convenience of the occupant of the property. A DE MINIMIS exception
allows a REIT to provide non-customary services to its tenants and not
disqualify income received with respect to that property as rents from
real property so long as the aggregate income derived by the REIT with
respect to a particular property that is attributable to the impermissible
services performed for any and all tenants at the property does not exceed
1.0% of the gross income derived by the REIT with respect to that
property. For these purposes, the amount we receive that is attributable
to impermissible services may not be valued at less than 150% of our
direct cost of providing these services.
Substantially all of our gross income is attributable to investments in real
property and specifically to rents attributable to and gains from the
disposition of real property. We believe that we do not
receive rents based on the net income or profits of a tenant. Moreover, we
believe that we do not receive rents (generally rent from office space leased to
PGI affiliates) from a Related Party Tenant which would cause us to fail either
of the gross income tests. We also believe that we do not receive any rent
attributable to personal property leased in connection with a lease of real
property that exceeds 15% of the total rents received under any such lease. For
this purpose we took into account as personal property the overhead cranes in
use at some of our industrial properties.
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The operating partnership provides services with respect to our properties,
but does not satisfy the "independent contractor" requirements described above.
To the extent necessary to preserve our status as a REIT, the operating
partnership intends to arrange to have services provided by independent
contractors from whom we or the operating partnership does not derive or receive
any income.
The operating partnership also receives fees in exchange for the performance
of usual and customary services relating to properties not owned entirely by the
operating partnership. The ratable portion of these fees attributable to the
part of the property not owned by the operating partnership does not constitute
qualifying income under the 75% or 95% gross income tests. The remainder of
these fees is ignored under the 75% and 95% gross income test so long as we have
a significant interest in such property. We believe that the aggregate amount of
such nonqualifying fees (and any other nonqualifying income) in any taxable year
will not exceed the limits on nonqualifying income under the gross income tests
described above.
Our properties include a 398-space parking facility for which we, through
the operating partnership, receive fees. This parking facility is operated
through an independent contractor from whom we derive no income.
The Services Company, pursuant to contractual arrangements, performs
management services with respect to properties not owned by us or the operating
partnership. The health club located in the 77 West Wacker Drive Building is
owned by the Services Company. The income from such services and the revenues
from the health club is taxed to the Services Company at the regular corporate
tax rates. Note payments and dividends paid by the Services Company to the
operating partnership will constitute qualifying income for purposes of the 95%
gross income test but not for the purposes of the 75% gross income test.
We intend to monitor the potential amount of nonqualifying income in the
future and to take action to avoid jeopardizing our REIT qualification. We may
for instance transfer some nonqualifying activities to a taxable corporation
such as the Services Company, from which we would receive dividends. If this
should occur, the operating partnership would be entitled to receive dividends
as a stockholder of such corporation. The amount of dividends available for
distribution to us would be reduced below the comparable amount of fee income
that would otherwise be received by the operating partnership because such a
corporation would be subject to a corporate level tax on its taxable income,
thereby reducing the amount of cash available for distribution. Furthermore, we
would be required to structure the stock interest owned by the operating
partnership in such a corporation to ensure that the various asset tests
described below were not violated. Particularly, the operating partnership would
not own more than 10% of the voting securities of such corporation and the value
of the stock interest would not exceed 5% of the value of our total assets.
If we fail to satisfy one or both of the 75% or the 95% gross income tests
for any taxable year, we may nevertheless qualify as a REIT for such year if we
are entitled to relief under some provisions of the Internal Revenue Code. These
relief provisions will be generally available if:
- Our failure to meet such test(s) was due to reasonable cause and not due
to willful neglect;
- We reported the nature and amount of each item of our income included in
the test(s) for such taxable year on a schedule attached to our return;
and
- any incorrect information on the schedule was not due to fraud with intent
to evade tax.
It is not possible, however, to state whether, in all circumstances, we would be
entitled to the benefit of these relief provisions. For example, if we fail to
satisfy the gross income tests because nonqualifying income that we
intentionally earn exceeds the limits on such income, the IRS could conclude
that our failure to satisfy the tests was not due to reasonable cause. As
discussed above in "--REIT Taxation" even if these relief provisions apply, we
will still be subject to a 100% tax on the greater of the amount
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by which we failed the 75% or the 95% test, multiplied by a fraction intended to
reflect our profitability. See "--Failure to Qualify."
ASSET TESTS
At the close of each quarter of our taxable year, we also must satisfy three
tests relating to the nature of our assets.
- First, at least 75% of the value of our total assets, including our
allocable share of assets held by the operating partnership and each
Property Partnership in which the operating partnership is a partner, must
be represented by real estate assets, cash, cash items and U.S. government
securities. For this purpose, real estate assets include stock or debt
instruments held for not more than one year purchased with proceeds of a
stock offering or a long-term (at least five years) debt offering of ours.
- Second, not more than 25% of our total assets may be represented by
securities other than those in the 75% asset class.
- Third, of the investments included in the 25% asset class, the value of
any one issuer's securities owned by us may not exceed 5% of the value of
our total assets, and we may not own more than 10% of any one issuer's
outstanding voting securities.
By virtue of our partnership interest in the operating partnership, we will be
deemed to own for purposes of these three asset tests our pro rata share of the
assets of the operating partnership, and the assets of each Property Partnership
in which the operating partnership is a partner or member. The operating
partnership owns 100% of the preferred stock of the Services Company and the
notes issued by the Services Company, but none of that corporation's voting
stock. We do not believe that our pro rata share of the stock and securities
(I.E., the notes) owned by the operating partnership in such corporation exceeds
5% of the total value of our assets. No independent appraisals will be obtained
to support this conclusion, and Tax Counsel, in rendering its opinion as to our
qualification as a REIT, is relying on our representation that the preferred
stock and note issued by the Services Company and held by the operating
partnership does not cause us to fail the 5% value test.
After initially meeting the asset tests at the close of any quarter, we will
not lose our status as a REIT for failure to satisfy any of the asset tests at
the end of a later quarter solely by reason of changes in asset values. If the
failure to satisfy the asset tests results from an acquisition of securities or
other property during a quarter, the failure can be cured by disposition of
sufficient nonqualifying assets within 30 days after the close of that quarter.
We intend to maintain adequate records of the value of our assets to ensure
compliance with the asset tests, and to take such other action within 30 days
after the close of any quarter as may be required to cure any noncompliance.
ANNUAL DISTRIBUTION REQUIREMENTS
To continue to qualify as a REIT, we are required to distribute dividends
(other than capital gain dividends) to our shareholders each year in an amount
at least equal to:
- the sum of (A) 95% of our "REIT taxable income" (computed without regard
to the dividends paid deduction and our net capital gain) plus (B) 95% of
the net income (after tax), if any, from foreclosure property, minus
- the sum of items of non-cash income.
Such distributions must be paid in the taxable year to which they relate, or
in the following taxable year if declared before we timely file our tax return
for such year and if paid on or before the first regular dividend payment after
such declaration. A distribution which is not pro rata within a class of
beneficial interest entitled to a dividend or which is not consistent with the
rights to distributions
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between classes of beneficial interest (a "preferential dividend") is not taken
into consideration for the purpose of meeting the distribution requirement.
Accordingly, the payment of a preferential dividend could affect our ability to
meet this distribution requirement.
To the extent that we do not distribute all of our net capital gain or
distribute at least 95%, but less than 100%, of our "REIT taxable income," as
adjusted, we will be subject to tax on the undistributed amount at regular
capital gains or ordinary corporate tax rates, as the case may be. Furthermore,
if we should fail to distribute for each calendar year at least the sum of (A)
85% of our REIT ordinary income for such year, (B) 95% of our REIT capital gain
net income for such year, plus (C) any undistributed taxable income from prior
periods, we will be subject to a 4.0% excise tax on the excess of such required
distribution over the amounts actually distributed. However, to the extent we
elect to retain and pay income tax on net long-term capital gains we received
during the year such amounts will be treated as having been distributed for
purposes of the 4.0% excise tax.
We have and intend to continue to make timely distributions sufficient to
satisfy all of the annual distribution requirements. We anticipate that we will
generally have sufficient cash or liquid assets to enable us to satisfy these
distribution requirements. It is possible that, from time to time, we may not
have sufficient cash or other liquid assets to meet the 95% distribution
requirement due to the insufficiency of cash flow from the operating partnership
in a particular year or to timing differences between the actual receipt of
income and actual payment of deductible expenses, on the one hand, and the
inclusion of such income and deduction of such expenses in computing our "REIT
taxable income," on the other hand. In the event that such an insufficiency or
such timing differences occur, in order to meet the 95% distribution
requirement, we may find it necessary to cause the operating partnership to make
distributions, to borrow funds, or to liquidate assets.
If we fail to meet the 95% distribution requirement as a result of an
adjustment to our tax return by the IRS upon audit, we may retroactively cure
the failure by paying "deficiency dividends" to our shareholders in a later
year, which may then be included in our deduction for dividends paid for the
earlier year. We may thus be able to avoid being taxed on amounts distributed as
deficiency dividends; however, we will be required to pay interest to the IRS
based upon the amount of any deduction taken for deficiency dividends.
PENALTY TAX ON PROHIBITED TRANSACTIONS
Our share of any gain realized on the sale of any property held as inventory
or otherwise primarily for sale to customers in the ordinary course of our trade
or business generally will be treated as income from a prohibited transaction
that is subject to a 100% penalty tax. Under existing law, whether property is
held as inventory or primarily for sale to customers in the ordinary course of a
trade or business is a question of fact that depends on all the facts and
circumstances with respect to the particular transaction. The operating
partnership, through the Property Partnerships, intends to hold our properties
for investment with a view to long-term appreciation, to engage in the business
of acquiring, developing, owning and operating the properties and to make such
occasional sales of the properties as are consistent with our investment
objectives. Based upon such investment objectives, we believe that in general
the properties should not be considered inventory or other property held
primarily for sale to customers in the ordinary course of a trade or business
and that the amount of income from prohibited transactions, if any, will not be
material.
46
<PAGE>
FAILURE TO QUALIFY
If we fail to qualify for taxation as a REIT in any taxable year and the
relief provisions do not apply, we will be subject to tax (including any
applicable alternative minimum tax) on our taxable income at regular corporate
rates. Distributions to shareholders in any year in which we fail to qualify as
a REIT will not be required and, if made, will not be deductible by us. As a
result, our failure to qualify as a REIT will reduce the cash available for
distribution by us to our shareholders. In addition, if we fail to qualify as a
REIT, all distributions to our shareholders will be taxable as ordinary dividend
income to the extent of our then current and accumulated earnings and profits,
and, subject to limitations in the Internal Revenue Code, corporate distributees
may be eligible for the dividends-received deduction. Unless entitled to relief
under specific statutory provisions, we also will be ineligible for
qualification as a REIT during the four taxable years following the year during
which qualification was lost. It is not possible to determine whether we would
be entitled to such statutory relief in all circumstances.
TAXATION OF OUR SECURITYHOLDERS
Any material federal income tax considerations relating to a particular
offering of securities covered by this prospectus will be described in the
applicable prospectus supplement.
EACH PROSPECTIVE PURCHASER IS ADVISED TO CONSULT HIS OR HER OWN TAX ADVISOR
REGARDING THE SPECIFIC TAX CONSEQUENCES TO HIM OR HER OF THE PURCHASE,
OWNERSHIP, AND SALE OF THE SECURITIES OFFERED BY THIS PROSPECTUS AND OF OUR
ELECTION TO BE TAXED AS A REIT, INCLUDING THE FEDERAL, STATE, LOCAL, FOREIGN,
AND OTHER TAX CONSEQUENCES OF SUCH PURCHASE, OWNERSHIP, SALE, AND ELECTION AND
OF POTENTIAL CHANGES IN APPLICABLE TAX LAWS.
POSSIBLE LEGISLATIVE OR OTHER ACTIONS AFFECTING TAX CONSIDERATIONS
Prospective holders should recognize that our present federal income tax
treatment may be modified by future legislative, judicial or administrative
actions or decisions at any time, which may be retroactive in effect, and, as a
result, any such action or decision may affect investments and commitments
previously made. The rules dealing with federal income taxation are constantly
under review by persons involved in the legislative process and by the IRS and
the Treasury Department, resulting in statutory changes as well as promulgation
of new, or revisions to existing, regulations and revised interpretations of
established concepts. No prediction can be made as to the likelihood of passage
of any new tax legislation or other provisions either directly or indirectly
affecting us or our securityholders.
47
<PAGE>
PLAN OF DISTRIBUTION
We may sell the securities offered pursuant to this prospectus and any
accompanying prospectus supplements to or through one or more underwriters or
dealers or may sell the securities to investors directly or through agents. Any
such underwriter or agent involved in the offer and sale of the securities will
be named in the applicable prospectus supplement. We may sell securities
directly to investors on our own behalf in those jurisdictions where we are
authorized to do so.
Underwriters may offer and sell the securities 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. We also may,
from time to time, authorize dealers or agents to offer and sell these
securities upon such terms and conditions as may be set forth in the applicable
prospectus supplement. In connection with the sale of any of these securities,
underwriters may receive compensation from us in the form of underwriting
discounts or commissions and may also receive commissions from purchasers of the
securities for whom they may act as agent. Underwriters may sell the securities
to or through dealers, and such dealers may receive compensation in the form of
discounts, concessions or commissions from the underwriters or commissions from
the purchasers for which they may act as agents.
Any underwriting compensation paid by us to underwriters or agents in
connection with the offering of these securities, and any discounts or
concessions or commissions allowed by underwriters to participating dealers,
will be set forth in the accompanying prospectus supplement. Dealers and agents
participating in the distribution of the securities may be deemed to be
underwriters, and any discounts and commissions received by them and any profit
realized by them on resale of the securities may be deemed to be underwriting
discounts and commissions.
Underwriters, dealers and agents may be entitled, under agreements entered
into with us, to indemnification against and contribution toward certain civil
liabilities, including liabilities under the Securities Act. Unless otherwise
set forth in the accompanying prospectus supplement, the obligations of any
underwriters to purchase any of these securities will be subject to certain
conditions precedent, and the underwriters will be obligated to purchase all of
such series of securities, if any are purchased.
Underwriters, dealers and agents may engage in transactions with, or perform
services for, us and our affiliates in the ordinary course of business.
In connection with the offering of the securities hereby, certain
underwriters, and selling group members and their respective affiliates may
engage in transactions that stabilize, maintain or otherwise affect the market
price of the applicable securities. Such transactions may include stabilization
transactions effected in accordance with Rule 104 of Regulation M promulgated by
the Securities and Exchange Commission (the "Commission") pursuant to which such
persons may bid for or purchase securities for the purpose of stabilizing their
market price. The underwriters in an offering of securities may also create a
"short position" for their account by selling more securities in connection with
the offering than they are committed to purchase from us. In such case, the
underwriters could cover all or a portion of such short position by either
purchasing securities in the open market following completion of the offering of
such securities or by exercising any over-allotment option granted to them by
us. In addition, the managing underwriter may impose "penalty bids" under
contractual arrangements with other underwriters, which means that they can
reclaim from an underwriter (or any selling group member participating in the
offering) for the account of the other underwriters, the selling concession with
respect to securities that are distributed in the offering but subsequently
purchased for the account of the underwriters in the open market. Any of the
transactions described in this paragraph or comparable transactions that are
described in any accompanying prospectus supplement may result in the
maintenance of the price of the securities at a level above that which might
otherwise prevail in the open market. None of such transactions described in
this paragraph or in an accompanying prospectus
48
<PAGE>
supplement are required to be taken by any underwriters and, if they are
undertaken, may be discontinued at any time.
The common shares are listed on the New York Stock Exchange under the symbol
"PGE." The Depositary Shares, Debt Securities, the preferred shares and the
Warrants will be new issues of securities with no established trading market and
may or may not be listed in a national securities exchange. Any underwriters or
agents to or through which securities are sold by us may make a market in such
securities, but such underwriters or agents will not be obligated to do so and
any of them may discontinue any market making at any time without notice. No
assurance can be given as to the liquidity of or trading market for any
Depositary Shares, Debt Securities, preferred shares or Warrants.
LEGAL MATTERS
Certain legal matters in connection with the validity of the securities
offered hereby will be passed upon for us by Winston & Strawn, Chicago,
Illinois. Legal matters relating to Maryland law, including the validity of the
issuance of any common shares or preferred shares offered hereby, will be passed
upon for us by Miles & Stockbridge P.C., Baltimore, Maryland. In addition, the
description of federal income tax considerations contained in this prospectus
under "Material Federal Income Tax Considerations" is, to the extent that it
constitutes matters of law, summaries of legal matters or legal conclusions, the
opinion of Winston & Strawn, our special tax counsel. The validity of the
securities offered by this prospectus may be passed upon for any underwriters or
agents by counsel named in the applicable prospectus supplement. Governor James
R. Thompson, Chairman of Winston & Strawn, is one of our trustees.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements as of December 31, 1998 and 1997 and for the year ended
December 31, 1998 and for the period from November 17, 1997 to December 31, 1997
and the combined financial statements of the Predecessor Properties for the
period from January 1, 1997 to November 16, 1997 and for the year ended December
31, 1996 included in our Annual Report on Form 10-K and the statement of revenue
and certain expenses of National City Center for the period from January 1, 1998
to September 30, 1998 included in our Current Report on Form 8-K dated February
5, 1999, the statement of revenue and certain expenses of 33 West Monroe for the
period from January 1, 1998 to September 30, 1998 included in our Current Report
on Form 8-K dated January 29, 1999, as set forth in their reports which are
incorporated in this prospectus by reference. Our consolidated financial
statements and statements of revenue and certain expenses are incorporated by
reference in reliance on Ernst & Young LLP's reports, given on their authority
as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other
information with the Commission. You may inspect and copy such reports, proxy
statements and other information at the public reference facilities maintained
by the Commission at Room 1204, Judiciary Plaza, 450 Fifth Street, N.W,
Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further
information. Such material can also be obtained from the Commission's worldwide
web site at http:/ www.sec.gov. Our outstanding common shares and redeemable
preferred shares are listed on the NYSE under the symbol "PGE" and PGE-PrB",
respectively, and all such reports, proxy statements and other information filed
by us with the NYSE may be inspected at the NYSE's offices at 20 Broad Street,
New York, New York 10005.
We have filed a registration statement, of which this prospectus is a part,
covering the securities offered hereby. As allowed by Commission rules, this
prospectus does not contain all the information
49
<PAGE>
set forth in the registration statement and the exhibits, financial statements
and schedules thereto. We refer you to the registration statement, the exhibits,
financial statements and schedules thereto for further information. This
prospectus is qualified in its entirety by such other information.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Commission allows us to "incorporate by reference" information into this
prospectus, which mens that we can disclose important information to you by
referring you to another document filed separately with the Commission. The
information incorporated by reference is deemed to be part of this prospectus,
except for any information superseded by information in this prospectus. We have
filed the document listed below with the Commission under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and these documents are
incorporated herein by reference:
a. Our Annual Report on Form 10-K for the year ended December 31, 1998
(filed on March 31, 1999, File No. 001-13589);
b. Our Quarterly Report on Form 10-Q for the quarter ended March 31, 1999
(filed on May 17, 1999, File No. 001-13589); and
c. Our Current Reports on Form 8-K dated January 29, 1999 (filed on
February 12, 1999, File No. 001-13589), February 5, 1999 (filed on February 12,
1999, File No. 001-13589), February 5, 1999 (filed on February 23, 1999, File
No. 001-13589), March 31, 1999 (filed on April 1, 1999, File No. 001-13589), and
April 13, 1999 (filed on April 15, 1999, File No. 001-13589).
Any documents we file pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of this prospectus and prior to the
termination of the offering of the securities to which this prospectus relates
will automatically be deemed to be incorporated by reference in this prospectus
and to be part hereof from the date of filing such documents. Any documents we
file pursuant to these sections of the Exchange Act after the date of the
initial registration statement that contains this prospectus and prior to the
effectiveness of the registration statement will automatically be deemed to be
incorporated by reference in this prospectus and to be part hereof from the date
of filing such documents.
Any statement contained in this prospectus or in a document incorporated by
reference shall be deemed to be modified or superseded for all purposes to the
extent that a statement contained in this prospectus or in any other document
which is also incorporated by reference modifies or supersedes such statement.
You may obtain copies of all documents which are incorporated in this
prospectus by reference (other than the exhibits to such documents which are not
specifically incorporated by reference herein) without charge upon written or
oral request to our Secretary/General Counsel, at Prime Group Realty Trust, 77
West Wacker Drive, Suite 3900, Chicago, Illinois, 60601, telephone number (312)
917-1300.
50
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
SEC registration fee........................................ $ 139,000
Printing and engraving expenses............................. 250,000
Legal fees and expenses..................................... 250,000
Accounting and due diligence fees and expenses.............. 250,000
Miscellaneous expenses (including Rating Agency, Transfer
Agent's, Trustees', Depositary and Warrant Agent's
Fees)..................................................... 313,750
------------
Total................................................... $ 1,202,750
------------
------------
</TABLE>
ITEM 15. INDEMNIFICATION OF TRUSTEES AND OFFICERS.
According to the declaration of trust and bylaws, Prime Group Realty Trust
shall indemnify its present and former trustees and officers and pay or
reimburse expenses for such individuals in advance of the final disposition of a
proceeding to the maximum extent permitted from time to time under Maryland law.
The MGCL, as applicable to Maryland real estate investment trusts, currently
provides that indemnification of a person who is a party, or threatened to be
made a party, to legal proceedings by reason of the fact that such a person is
or was a trustee, officer, employee or agent of a real estate investment trust
or other entity at the request of the real estate investment trust, against
judgments, fines, penalties, amounts paid in settlement and reasonable expenses,
is mandatory in certain circumstances and permissive in others, subject to a
determination that indemnification is permissible under the circumstances, which
determination shall be made by the board of trustees, a committee of the board
of trustees consisting of two or more trustees not parties to the proceeding (if
there does not exist a quorum of the board of trustees consisting of trustees
not parties to the proceeding), special legal counsel appointed by the board of
trustees or such committee of the board of trustees, or by the shareholders, so
long as it is not established that the act or omission of such person was
material to the matter giving rise to the proceedings and was committed in bad
faith, was the result of active and deliberate dishonesty, involved such person
receiving an improper personal benefit in money, property or services, or, in
the case of criminal proceedings, such person had reason to believe that his or
her act or omission was unlawful.
Prime Group Realty Trust's officers and trustees are also indemnified
pursuant to the Partnership Agreement and their respective employment
agreements, which agreements are filed as exhibits hereto.
Prime Group Realty Trust purchased an insurance policy which purports to
insure the officers and trustees of Prime Group Realty Trust against certain
liabilities incurred by them in the discharge of their functions as such
officers and trustees, except for liabilities resulting from their own
malfeasance.
See the forms of underwriting agreements to be incorporated by reference as
Exhibits 1.1 to 1.3 for certain indemnification provisions applicable to
underwritten offerings.
II-1
<PAGE>
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------- --------------------------------------------------------------------------------------------------------
<C> <S>
1.1 Form of Underwriting Agreement (for Common Shares)(1)
1.2 Form of Underwriting Agreement (for Preferred Shares)(1)
1.3 Form of Underwriting Agreement (for Debt Securities)(1)
3.1 Articles of Amendment and Restatement of Declaration of Trust of Prime Group Realty Trust as filed as an
exhibit to the Company's 1997 Annual Report on Form 10-K and incorporated herein by reference
3.2 Articles Supplementary to the Articles of Amendment and Restatement of Declaration of Trust of Prime
Group Realty Trust as filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1998 and incorporated herein by reference
3.3 Amended and Restated Bylaws of Prime Group Realty Trust as filed as an exhibit to the Company's 1997
Annual Report on Form 10-K and incorporated herein by reference
3.4 Amended and Restated Agreement of Limited Partnership of Prime Group Realty, L.P. (the "Amended and
Restated Agreement of Limited Partnership") as filed as an exhibit to the Company's 1997 Annual Report
on Form 10-K and incorporated herein by reference
3.5 Amendment No. 1 to the Amended and Restated Agreement of Limited Partnership dated as of December 15,
1998 as filed as an exhibit to Amendment No. 1 to the Company's Registration Statement on Form S-11 (No.
333-51599) and incorporated herein by reference
3.6 Amendment No. 2 to the Amended and Restated Agreement of Limited Partnership dated as of December 15,
1998 as filed as an exhibit to Amendment No. 1 to the Company's Registration Statement on Form S-11 (No.
333-51599) and incorporated herein by reference
3.7 Amendment No. 3 to the Amended and Restated Agreement of Limited Partnership dated as of January 15,
1998 as filed as an exhibit to Amendment No. 1 to the Company's Registration Statement on Form S-11 (No.
333-51599) and incorporated herein by reference
3.8 Amendment No. 4 to the Amended and Restated Agreement of Limited Partnership dated as of February 13,
1998 as filed as an exhibit to Amendment No. 1 to the Company's Registration Statement on Form S-11 (No.
333-51599) and incorporated herein by reference
3.9 Amendment No. 5 to the Amended and Restated Agreement of Limited Partnership dated as of March 13, 1998
as filed as an exhibit to Amendment No. 1 to the Company's Registration Statement on Form S-11 (No.
333-51599) and incorporated herein by reference
3.10 Amendment No. 6 to the Amended and Restated Agreement of Limited Partnership dated as of March 25, 1998
as filed as an exhibit to Amendment No. 1 to the Company's Registration Statement on Form S-11 (No.
333-51599) and incorporated herein by reference
3.11 Amendment No. 7 to the Amended and Restated Agreement of Limited Partnership dated as of April 15, 1998
as filed as an exhibit to Amendment No. 1 to the Company's Registration Statement on Form S-11 (No.
333-51599) and incorporated herein by reference
3.12 Amendment No. 8 to the Amended and Restated Agreement of Limited Partnership dated as of May 15, 1998 as
filed as an exhibit to Amendment No. 2 to the Company's Registration Statement on Form S-11 (No.
333-51599) and incorporated herein by reference
3.13 Amendment No. 9 to the Amended and Restated Agreement of Limited Partnership dated as of June 5, 1998 as
filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1998
and incorporated herein by reference
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------- --------------------------------------------------------------------------------------------------------
<C> <S>
3.14 Amendment No. 10 to the Amended and Restated Agreement of Limited Partnership dated as of June 15, 1998
as filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
1998 and incorporated herein by reference
3.15 Amendment No. 11 to the Amended and Restated Agreement of Limited Partnership dated as of July 15, 1998
as filed as an exhibit to Post-Effective Amendment No. 1 to the Company's Registration Statement on Form
S-11 (No. 333-51935) and incorporated herein by reference
3.16 Amendment No. 12 to the Amended and Restated Agreement of Limited Partnership dated as of August 14,
1998 as filed as an exhibit to Post-Effective Amendment No. 1 to the Company's Registration Statement on
Form S-11 (No. 333-51935) and incorporated herein by reference
3.17 Amendment No. 13 to the Amended and Restated Agreement of Limited Partnership dated as of September 15,
1998 as filed as an exhibit to Amendment No. 1 to Post-Effective Amendment No. 1 to the Company's
Registration Statement on Form S-11 (No. 333-51935) and incorporated herein by reference
3.18 Amendment No. 14 to the Amended and Restated Agreement of Limited Partnership dated as of October 15,
1998 as filed as an exhibit to Amendment No. 2 to the Company's Registration Statement on Form S-3 (No.
333-64973) and incorporated herein by reference
3.19 Amendment No. 15 to the Amended and Restated Agreement of Limited Partnership dated as of November 16,
1998 as filed as an exhibit to Amendment No. 1 to the Company's Registration Statement on Form S-3 (No.
333-64973) and incorporated herein by reference
3.20 Amendment No. 16 to the Amended and Restated Agreement of Limited Partnership dated as of December 15,
1998 as filed as an exhibit to Post-Effective Amendment No. 3 to the Company's Registration Statement on
Form S-3 (Registration No. 333-51935) and incorporated herein by reference
3.21 Amendment No. 17 to the Amended and Restated Agreement of Limited Partnership dated as of January 15,
1999 as filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 1999 and incorporated herein by reference
3.22 Amendment No. 18 to the Amended and Restated Agreement of Limited Partnership dated as of February 15,
1999 as filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 1999 and incorporated herein by reference
3.23 Amendment No. 19 to the Amended and Restated Agreement of Limited Partnership dated as of March 15, 1999
as filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31,
1999 and incorporated herein by reference
3.24 Amendment No. 21 to the Amended and Restated Agreement of Limited Partnership dated as of April 15,
1999(3)
3.25 Amendment No. 22 to the Amended and Restated Agreement of Limited Partnership dated as of April 22,
1999(3)
3.26 Amendment No. 23 to the Amended and Restated Agreement of Limited Partnership dated as of May 15,
1999(3)
4.1 Form of Indenture of Prime Group Realty Trust, providing for Issuance of Senior Debt Securities in
Series(3)
4.2 Form of Indenture of Prime Group Realty Trust, providing for Issuance of Subordinated Debt Securities in
Series(3)
4.3 Form of Deposit Agreement(3)
4.4 Form of Articles Supplementary for the Preferred Shares(3)
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------- --------------------------------------------------------------------------------------------------------
<C> <S>
4.5 Form of Warrant Agreement(3)
4.6 Form of Purchase Contract Agreement(3)
4.7 Form of Pledge Agreement relating to Share Purchase Contracts(3)
5.1 Opinion of Miles & Stockbridge(3)
5.2 Opinion of Winston & Strawn(3)
8.1 Opinion of Winston & Strawn regarding tax matters(3)
12.1 Computation of Ratios of Earnings to Fixed Charges and Preferred Share Distributions as filed as an
exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1999 and
incorporated herein by reference
23.1 Consent of Miles & Stockbridge (included in Exhibit 5.1)
23.2 Consents of Winston & Strawn (included in Exhibits 5.2 and 8.1)
23.3 Consent of Ernst & Young LLP(3)
24.1 Powers of Attorney(2)
25.1 Form T-1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 relating to
the Senior Debt Indenture(3)
25.2 Form T-1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 relating to
the Subordinated Debt Indenture(3)
</TABLE>
- ---------
(1) To be incorporated by reference in connection with the offering of
securities offered by this registration statement.
(2) Filed previously.
(3) Filed herewith.
ITEM 17. UNDERTAKINGS.
(a) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to trustees, officers and controlling persons of
the registrant pursuant to the provisions described under Item 15 above, 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 Securities Act of 1933 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 trustee, officer, or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such trustee, 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
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
(b) 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
this
II-4
<PAGE>
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
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and
(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 (b)(1)(i) and (b)(1)(ii) herein do not apply
if the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the undersigned
registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the registration statement.
(2) 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.
(3) That for purposes 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 the shall be deemed to be the initial
bona fide offering thereof.
(c) The 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 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.
(d) That, for purposes of determining liability under the Securities Act,
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 Rules 424(b)(1) 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.
(e) The undersigned Company hereby undertakes to file an application, if
necessary, for the purpose of determining the eligibility of any trustee to act
under subsection (a) of Section 310 of the Trust Indenture Act (the "Act") in
accordance with the rules and regulations prescribed by the Commission under
Section 305(b)(2) of the Act.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, 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 amendment to
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Chicago, State of Illinois, on June 8, 1999.
<TABLE>
<S> <C> <C>
PRIME GROUP REALTY TRUST
By: /s/ RICHARD S. CURTO
-----------------------------------------
Richard S. Curto
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
amendment to registration statement has been signed below on June 8, 1999 by the
following persons in the capacities indicated.
<TABLE>
<CAPTION>
NAME TITLE
- ------------------------------ ----------------------------------------------
<C> <S>
MICHAEL W. RESCHKE*
- ------------------------------ Chairman of the Board, Trustee
Michael W. Reschke
/s/ RICHARD S. CURTO
- ------------------------------ President and Chief Executive Officer
Richard S. Curto (principal executive officer), Trustee
WILLIAM M. KARNES*
- ------------------------------ Executive Vice President and Chief Financial
William M. Karnes Officer (principal financial officer)
ROY P. RENDINO* Senior Vice President--Finance and Chief
- ------------------------------ Accounting Officer (principal accounting
Roy P. Rendino officer)
JACQUE M. DUCHARME*
- ------------------------------ Trustee
Jacque M. Ducharme
STEPHEN J. NARDI*
- ------------------------------ Trustee
Stephen J. Nardi
CHRISTOPHER J. NASSETTA*
- ------------------------------ Trustee
Christopher J. Nassetta
</TABLE>
II-6
<PAGE>
<TABLE>
<CAPTION>
NAME TITLE
- ------------------------------ ----------------------------------------------
<C> <S>
THOMAS J. SAYLAK*
- ------------------------------ Trustee
Thomas J. Saylak
JAMES R. THOMPSON*
- ------------------------------ Trustee
James R. Thompson
</TABLE>
<TABLE>
<S> <C> <C>
*By: /s/ RICHARD S. CURTO
-------------------------
Richard S. Curto
ATTORNEY-IN-FACT
</TABLE>
II-7
<PAGE>
Exhibit 3.24
AMENDMENT NO. 21 TO AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF PRIME GROUP REALTY, L.P.
This AMENDMENT NO. 21 TO AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF PRIME GROUP REALTY, L.P. (this "Amendment") is made as of
April 15, 1999 by Prime Group Realty Trust, a Maryland real estate investment
trust ("PGRT"), as the Managing General Partner of Prime Group Realty, L.P.,
a Delaware limited partnership (the "Partnership"), and on behalf of the
other Partners (as hereinafter defined). Capitalized terms used but not
otherwise defined herein shall have the meanings given to such terms in the
Amended and Restated Agreement of Limited Partnership of the Partnership,
dated as of November 17, 1997, by and among PGRT and the other parties
signatory thereto, as amended thereafter (as so amended, the "Limited
Partnership Agreement").
W I T N E S S E T H:
WHEREAS, pursuant to Section 4.3.C. of the Limited Partnership
Agreement, the Managing General Partner may raise all or any portion of
Additional Funds required by the Partnership for the acquisition of
additional properties by accepting additional Capital Contributions,
including the issuance of Common Units for Capital Contributions that consist
of property or interests in property;
WHEREAS, pursuant to that certain Exchange Agreement dated as of
December 15, 1997 by and between H Group LLC, a Delaware limited liability
company ("HG"), and the Partnership (the "Exchange Agreement"), HG agreed,
among other things, to grant to the Partnership an option (the "First
Option") to exchange the Underlying Option (as defined in the Exchange
Agreement) for 220,000 Common Units of Limited Partner Interest (subject to
adjustment pursuant to the terms of the Exchange Agreement), which grant of
the First Option contemplated the transfer by the Partnership to HG of 5,000
Common Units of Limited Partner Interest on the date thereof and, subject to
the terms of the First Option, 5,000 Common Units of Limited Partner Interest
(subject to adjustment pursuant to the terms of the Exchange Agreement) on
the 15th day of each month thereafter (each such transfer a "First Option
Maintenance Transfer") for such number of months set forth in the Exchange
Agreement;
WHEREAS, the Partnership has agreed to the terms of the grant by HG of
the First Option set forth in the Exchange Agreement and desires to effect
the First Option Maintenance Transfer due on April 15, 1999;
WHEREAS, HG was admitted to the Partnership as an Additional Limited
Partner as of December 15, 1997 pursuant to Amendment No. 2 to the Limited
Partnership Agreement;
<PAGE>
WHEREAS, the Partners desire to amend the Limited Partnership Agreement
to reflect the increase in outstanding Common Units resulting from the
issuance of Common Units to HG in connection with the First Option
Maintenance Transfer due on April 15, 1999; and
WHEREAS, Sections 2.4 and 12.3 of the Limited Partnership Agreement
authorize, among other things, the Managing General Partner, as true and
lawful agent and attorney-in fact, to execute, swear to, acknowledge,
deliver, file and record this Amendment on behalf of each Partner that has
executed the Limited Partnership Agreement and on behalf of the Partnership.
NOW, THEREFORE, for good and adequate consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
Section 1. ACCEPTANCE OF CAPITAL CONTRIBUTION IN EXCHANGE FOR COMMON
UNITS. (a) PGRT, as Managing General Partner and on behalf of the
Partnership, hereby accepts the grant of the rights consisting of the First
Option during the seventeenth month of the term of the First Option from HG
as a Capital Contribution having a value on the date hereof of $100,000, in
exchange for 7549.0 Common Units of Limited Partner Interest which are hereby
issued by the Partnership to HG pursuant to Section 4.3.C. of the Limited
Partnership Agreement, and which are evidenced by Common Unit Certificate
No. 43 of the Partnership.
(b) Each of the Common Units of Limited Partner Interest issued to
HG pursuant to this SECTION 1 shall have the same terms and provisions of the
Common Units of Limited Partner Interest issued by the Partnership on
November 17, 1997 except that (i) the Exchange Rights relating thereto may be
exercised at any time after December 15, 1999 (as opposed to November 17,
1998) and (ii) such Common Units of Limited Partner Interest will be subject
to the Registration Rights Agreement dated as of December 15, 1997 by and
among PGRT, the Partnership and HG as opposed to the Registration Rights
Agreement entered into by PGRT and the Partnership on November 17, 1997.
Section 2. AMENDMENT OF EXHIBIT A TO THE LIMITED PARTNERSHIP AGREEMENT.
Exhibit A to the Limited Partnership Agreement is hereby amended and
restated to reflect the aforementioned change(s) by deleting Exhibit A
attached thereto in its entirety, and by attaching in lieu thereof a
replacement exhibit in the form of EXHIBIT A attached hereto. From and after
the effectiveness of this Amendment, the amended and restated EXHIBIT A
attached hereto shall be the only Exhibit A to the Limited Partnership
Agreement, unless and until it is hereafter further amended.
-2-
<PAGE>
Section 3. REFERENCE TO AND EFFECT ON THE LIMITED PARTNERSHIP AGREEMENT.
A. The Limited Partnership Agreement is hereby deemed to be
amended to the extent necessary to effect the matters contemplated by this
Amendment. Except as specifically provided for hereinabove, the provisions of
the Limited Partnership Agreement shall remain in full force and effect.
B. The execution, delivery and effectiveness of this Amendment
shall not operate (i) as a waiver of any provision, right or obligation of
the Managing General Partner, the other General Partner or any Limited
Partner under the Limited Partnership Agreement except as specifically set
forth herein or (ii) as a waiver or consent to any subsequent action or
transaction.
Section 4. APPLICABLE LAW. This Amendment shall be construed in
accordance with and governed by the laws of the State of Delaware, without
regard to the principles of conflicts of law.
[signature page follows]
-3-
<PAGE>
AMENDMENT NO. 21 TO AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF PRIME
GROUP REALTY, L.P.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the date first written above.
MANAGING GENERAL PARTNER:
PRIME GROUP REALTY TRUST, a
Maryland real estate investment trust
By: /s/ W. Michael Karnes
-------------------------------------
Name: W. Michael Karnes
Title: Executive VP
LIMITED PARTNERS:
Each Limited Partner hereby executes
this Amendment to the Limited
Partnership Agreement.
By: PRIME GROUP REALTY TRUST, a
Maryland real estate investment
trust, as attorney-in fact
By: /s/ W. Michael Karnes
---------------------------------
Name: W. Michael Karnes
Title: Executive VP
-4-
<PAGE>
EXHIBIT A (*)
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
MANAGING GENERAL PARTNER COMMON UNITS CONTRIBUTION
- ------------------------ ------------ ------------
<S> <C> <C>
Prime Group Realty Trust 15,136,488 (**)
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Attn: Richard S. Curto
James F. Hoffman
GENERAL PARTNER
- ---------------
The Nardi Group, L.L.C. 927,100 $18,542,000
c/o Stephen J. Nardi
4100 Madison Street
Hillside, IL 60162
LIMITED PARTNERS
- ----------------
The Nardi Group, L.L.C. 210,813 $3,143,009
c/o Stephen J. Nardi
4100 Madison Street
Hillside, IL 60162
Edward S. Hadesman 388,677 $7,773,540
Trust Dated May 22, 1992
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Grandville/Northwestern 9,750 $195,000
Management Corporation
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
</TABLE>
- --------------------
(*) As amended by Amendment No. 21 to the Amended and Restated Agreement of
Limited Partnership of Prime Group Realty, L.P.
(**) This amount shall be inserted by the Managing General Partner.
<PAGE>
EXHIBIT A - CONT'D
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
LIMITED PARTNERS (CONT'D) COMMON UNITS CONTRIBUTION
- ------------------------- ------------ ------------
<S> <C> <C>
Carolyn B. Hadesman 54,544 $1,090,880
Trust Dated May 21, 1992
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Lisa Hadesman 1991 Trust 169,053 $3,381,060
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Cynthia Hadesman 1991 Trust 169,053 $3,381,060
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Tucker B. Magid 33,085 $661,700
545 Ridge Road
Highland Park, IL 60035
Frances S. Shubert 28,805 $576,100
511 Lynn Terrace
Waukegan, IL 60085
Grandville Road Property, Inc. 7,201 $144,020
c/o Ms. Frances S. Shubert
511 Lynn Terrace
Waukegan, IL 60085
Sky Harbor Associates 62,149 $1,242,980
c/o Howard I. Bernstein
6541 North Kilbourn
Lincolnwood, IL 60646
Jeffrey A. Patterson 110,000 $2,200,000
c/o Prime Group Realty Trust
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
</TABLE>
<PAGE>
EXHIBIT A - CONT'D
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
LIMITED PARTNERS (CONT'D) COMMON UNITS CONTRIBUTION
- ------------------------- ------------ ------------
<S> <C> <C>
Primestone Investment Partners, L.P. 7,944,893 (**)
c/o The Prime Group, Inc.
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Attn: Paul A. Roehri
Prime Group VI, L.P. 304,097 $6,050,500
c/o The Prime Group, Inc.
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Attn: Michael W. Reshcke
Robert J. Rudnik
H Group LLC 95,563 $1,600,000
c/o Heitman Financial Ltd.
180 N. LaSalle
Suite 3600
Chicago, IL 60601
Attn: Norman Perlmutter
Ray R. Grinvalds 5,216 $104,320
217 Deer Valley Drive
Barrington, IL 60010
Warren H. John 37,259 $745,180
1730 N. Clark Street
Chicago, IL 60614
</TABLE>
- --------------------
(**) This amount shall be inserted by the Managing General Partner.
<PAGE>
EXHIBIT A - CONT'D
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
MANAGING GENERAL PARTNER PREFERRED UNITS CONTRIBUTION
- ------------------------ --------------- ------------
<S> <C> <C>
Prime Group Realty Trust 2,000,000 (**)
77 West Wacker Drive Convertible Preferred
Suite 3900 Units
Chicago, IL 60601
Attn: Richard S. Curto
James F. Hoffman
Prime Group Realty Trust 4,000,000 (**)
77 West Wacker Drive Series B Preferred Units
Suite 3900
Chicago, IL 60601
Attn: Richard S. Curto
James F. Hoffman
</TABLE>
- --------------------
(**) This amount shall be inserted by the Managing General Partner.
<PAGE>
Exhibit 3.25
AMENDMENT NO. 22 TO AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF PRIME GROUP REALTY, L.P.
This AMENDMENT NO. 22 TO AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF PRIME GROUP REALTY, L.P. (this "Amendment") is made as of
April 22, 1999 by Prime Group Realty Trust, a Maryland real estate investment
trust ("PGRT"), as the Managing General Partner of Prime Group Realty, L.P.,
a Delaware limited partnership (the "Partnership"), and on behalf of the
other Partners (as hereinafter defined). Capitalized terms used but not
otherwise defined herein shall have the meanings given to such terms in the
Amended and Restated Agreement of Limited Partnership of the Partnership,
dated as of November 17, 1997, by and among PGRT and the other parties
signatory thereto, as amended thereafter (as so amended, the "Limited
Partnership Agreement").
W I T N E S S E T H:
WHEREAS, pursuant to Section 4.3.C. of the Limited Partnership
Agreement, the Managing General Partner may raise all or any portion of
Additional Funds required by the Partnership for the acquisition of
additional properties by accepting additional Capital Contributions,
including the issuance of Common Units for Capital Contributions that consist
of property or interests in property;
WHEREAS, pursuant to that Real Estate Sales Contract, dated as of
October 20, 1997, by and among The Prime Group, Inc., an Illinois
corporation, Prime Group Realty Trust, a Maryland real estate investment
trust, Prime Group Realty, L.P., a Delaware limited partnership and the
Contributors named therein (the "Agreement"), the Partnership agreed to
purchase two properties in Carol Stream, Illinois (the "Properties")upon the
fulfillment of certain conditions;
WHEREAS, the conditions of the Agreement having been fulfilled, the
Partnership is acquiring the Properties in return for issuing Common Units of
Limited Partner Interest to The Nardi Group, L.L.C.; and
WHEREAS, Sections 2.4 and 12.3 of the Limited Partnership Agreement
authorize, among other things, the Managing General Partner, as true and
lawful agent and attorney-in fact, to execute, swear to, acknowledge,
deliver, file and record this Amendment on behalf of each Partner that has
executed the Limited Partnership Agreement and on behalf of the Partnership.
<PAGE>
NOW, THEREFORE, for good and adequate consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
Section 1. ACCEPTANCE OF CAPITAL CONTRIBUTION IN EXCHANGE FOR COMMON
UNITS. (a) PGRT, as Managing General Partner and on behalf of the
Partnership, hereby accepts from The Nardi Group, L.L.C. the grant of all of
its right, title and interest in the Properties, legal descriptions of which
are attached hereto as EXHIBITS 1 and 2, as a Capital Contribution in
exchange for 207,631 Common Units of Limited Partner Interest which are
hereby issued by the Partnership to The Nardi Group, L.L.C. pursuant to
Section 4.3.C of the Limited Partnership Agreement, and which are evidenced
by Common Unit Certificate No. 44 of the Partnership.
(b) Each of the Common Units of Limited Partner Interest issued to
The Nardi Group, L.L.C. pursuant to this SECTION 2 shall have the same terms
and provisions as the Common Units of Limited Partner Interest issued by the
Partnership on November 17, 1997 except that the Exchange Rights relating
thereto may be exercised only after the first (1st) anniversary of their
issuance (as opposed to November 17, 1998).
Section 2. AMENDMENT OF EXHIBIT A TO THE LIMITED PARTNERSHIP AGREEMENT.
Exhibit A to the Limited Partnership Agreement is hereby amended and
restated to reflect the aforementioned change(s) by deleting Exhibit A
attached thereto in its entirety, and by attaching in lieu thereof a
replacement exhibit in the form of EXHIBIT A attached hereto. From and after
the effectiveness of this Amendment, the amended and restated EXHIBIT A
attached hereto shall be the only Exhibit A to the Limited Partnership
Agreement, unless and until it is hereafter further amended.
Section 3. REFERENCE TO AND EFFECT ON THE LIMITED PARTNERSHIP AGREEMENT.
A. The Limited Partnership Agreement is hereby deemed to be
amended to the extent necessary to effect the matters contemplated by this
Amendment. Except as specifically provided for hereinabove, the provisions of
the Limited Partnership Agreement shall remain in full force and effect.
B. The execution, delivery and effectiveness of this Amendment
shall not operate (i) as a waiver of any provision, right or obligation of
the Managing General Partner, the other General Partner or any Limited
Partner under the Limited Partnership Agreement except as specifically set
forth herein or (ii) as a waiver or consent to any subsequent action or
transaction.
2
<PAGE>
Section 4. APPLICABLE LAW. This Amendment shall be construed in
accordance with and governed by the laws of the State of Delaware, without
regard to the principles of conflicts of law.
[signature page follows]
3
<PAGE>
AMENDMENT NO. 22 TO AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF PRIME
GROUP REALTY, L.P.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the date first written above.
MANAGING GENERAL PARTNER:
PRIME GROUP REALTY TRUST, a
Maryland real estate investment trust
By: /s/ W. Michael Karnes
-------------------------------------
Name: W. Michael Karnes
Title: Executive Vice President
LIMITED PARTNERS:
Each Limited Partner hereby executes
this Amendment to the Limited
Partnership Agreement.
By: PRIME GROUP REALTY TRUST, a
Maryland real estate investment
trust, as attorney-in fact
By: /s/ W. Michael Karnes
---------------------------------
Name: W. Michael Karnes
Title: Executive Vice President
As to Section 1 hereof,
ACKNOWLEDGED AND AGREED:
THE NARDI GROUP, L.L.C., a
Delaware limited liability company
By: /s/ Stephen J. Nardi
---------------------------------
Name: Stephen J. Nardi
Title: President and CEO
4
<PAGE>
EXHIBIT A (*)
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
MANAGING GENERAL PARTNER COMMON UNITS CONTRIBUTION
- ------------------------ ------------ ------------
<S> <C> <C>
Prime Group Realty Trust 15,136,488 (**)
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Attn: Richard S. Curto
James F. Hoffman
GENERAL PARTNER
- ---------------
The Nardi Group, L.L.C. 927,100 $18,542,000
c/o Stephen J. Nardi
4100 Madison Street
Hillside, IL 60162
LIMITED PARTNERS
- ----------------
The Nardi Group, L.L.C. 207,631 $3,143,009
c/o Stephen J. Nardi
4100 Madison Street
Hillside, IL 60162
Edward S. Hadesman
Trust Dated May 22, 1992 388,677 $7,773,540
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Grandville/Northwestern 9,750 $195,000
Management Corporation
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
</TABLE>
- --------------------
(*) As amended by Amendment No. 22 to the Amended and Restated Agreement of
Limited Partnership of Prime Group Realty, L.P.
(**) This amount shall be inserted by the Managing General Partner.
<PAGE>
EXHIBIT A - CONT'D
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
LIMITED PARTNERS (CONT'D) COMMON UNITS CONTRIBUTION
- ------------------------- ------------ ------------
<S> <C> <C>
Carolyn B. Hadesman 54,544 $1,090,880
Trust Dated May 21, 1992
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Lisa Hadesman 1991 Trust 169,053 $3,381,060
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Cynthia Hadesman 1991 Trust 169,053 $3,381,060
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Tucker B. Magid 33,085 $661,700
545 Ridge Road
Highland Park, IL 60035
Frances S. Shubert 28,805 $576,100
511 Lynn Terrace
Waukegan, IL 60085
Grandville Road Property, Inc. 7,201 $144,020
c/o Ms. Frances S. Shubert
511 Lynn Terrace
Waukegan, IL 60085
Sky Harbor Associates 62,149 $1,242,980
c/o Howard I. Bernstein
6541 North Kilbourn
Lincolnwood, IL 60646
Jeffrey A. Patterson 110,000 $2,200,000
c/o Prime Group Realty Trust
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
</TABLE>
<PAGE>
EXHIBIT A - CONT'D
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
LIMITED PARTNERS (CONT'D) COMMON UNITS CONTRIBUTION
- ------------------------- ------------ ------------
<S> <C> <C>
Primestone Investment Partners, L.P. 7,944,893 (**)
c/o The Prime Group, Inc.
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Attn: Paul A. Roehri
Prime Group VI, L.P. 304,097 $6,050,500
c/o The Prime Group, Inc.
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Attn: Michael W. Reshcke
Robert J. Rudnik
H Group LLC 95,563 $1,600,000
c/o Heitman Financial Ltd.
180 N. LaSalle
Suite 3600
Chicago, IL 60601
Attn: Norman Perlmutter
Ray R. Grinvalds 5,216 $104,320
217 Deer Valley Drive
Barrington, IL 60010
Warren H. John 37,259 $745,180
1730 N. Clark Street
Chicago, IL 60614
</TABLE>
- --------------------
(**) This amount shall be inserted by the Managing General Partner.
<PAGE>
EXHIBIT A - CONT'D
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
MANAGING GENERAL PARTNER PREFERRED UNITS CONTRIBUTION
- ------------------------ --------------- ------------
<S> <C> <C>
Prime Group Realty Trust 2,000,000 (**)
77 West Wacker Drive Convertible Preferred
Suite 3900 Units
Chicago, IL 60601
Attn: Richard S. Curto
James F. Hoffman
Prime Group Realty Trust 4,000,000 (**)
77 West Wacker Drive Series B Preferred Units
Suite 3900
Chicago, IL 60601
Attn: Richard S. Curto
James F. Hoffman
</TABLE>
- --------------------
(**) This amount shall be inserted by the Managing General Partner.
<PAGE>
ACKNOWLEDGMENT AND AGREEMENT BY
ADDITIONAL LIMITED PARTNER
Prime Group Realty Trust
77 West Wacker Drive
Suite 3900
Chicago, Illinois 60601
Reference is made to that certain Amended and Restated Agreement of
Limited Partnership of Prime Group Realty, L.P., dated as of November 17,
1997 (as amended, the "PARTNERSHIP AGREEMENT"). All terms used as defined
terms and not otherwise defined herein shall have the meaning ascribed
thereto in the Partnership Agreement. The Partnership is issuing and
delivering 207,631 Common Units to the undersigned in connection with the
purchase from the undersigned of two properties in Carol Stream, Illinois.
The undersigned acknowledges and agrees that it is an express condition of
the Partnership Agreement that an Additional Limited Partner assume all of
the obligations under the Partnership Agreement with respect to the Common
Units.
The undersigned hereby represents, warrants, covenants to, and agrees
with, the Partnership, the Managing General Partner and each Limited Partner
as follows:
(i) the undersigned has received and reviewed a copy of the Partnership
Agreement;
(ii) the undersigned desires to become an Additional Limited Partner in
the Partnership in accordance with the terms of the Partnership
Agreement;
(iii) the undersigned, by execution hereof, accepts and agrees that it is
bound by all of the terms and provisions of the Partnership
Agreement, including without limitation the provisions of
Section 2.4 and the restrictions on transfer set forth in
Article 11 of the Partnership Agreement;
(iv) the undersigned assumes all of the obligations of an Additional
Limited Partner pursuant to the Partnership Agreement with respect
to the Common Units issued to the undersigned;
(v) the Partnership Agreement shall be binding on and enforceable
against the undersigned as a Limited Partner in accordance with its
terms;
<PAGE>
(vi) the undersigned is an "accredited investor" within the meaning of
Rule 501(a) promulgated under the Securities Act of 1933, as
amended (the "SECURITIES ACT"). The undersigned understands the
risks of, and other considerations relating to, its acquisition of
the Common Units. The undersigned, by reason of its business and
financial experience, together with the business and financial
experience of those persons, if any, retained by it to represent or
advise it with respect to its investment in the Common Units,
(i) has such knowledge, sophistication and experience in financial
and business matters and in making investment decisions of this
type, that it is capable of evaluating the merits and risks of an
investment in Common Units of the Partnership and of making an
informed investment decision, (ii) is capable of protecting its own
interests in connection with its acquisition of Common Units or has
engaged representatives or advisors to assist the undersigned in
protecting its interests in connection with its acquisition of
Common Units and (iii) is capable of bearing the economic risk of
such investment in Common Units.
(vii) The Common Units to be issued to the undersigned are acquired by
the undersigned for its own account for investment only and not
with a view to, or with any intention of, a distribution or resale
thereof, in whole or in part, or the grant of any participation
therein until and unless the Common Units are exchanged for Common
Shares of the Trust following the one year lock-up period
applicable to the Common Units, in accordance with the Partnership
Agreement. The undersigned hereby confirms that all documents,
instruments, records and books pertaining to investment in Common
Units of the Partnership and requested by the undersigned have been
made available or delivered to the undersigned. The undersigned
has had an opportunity to ask questions of and receive answers from
the Partnership, or from a person or persons acting on the
Partnership's behalf, concerning the Partnership, the terms and
conditions of the transaction contemplated by this Acknowledgment
and Agreement and the undersigned's acquisition of Common Units.
The undersigned has relied upon, and is making its investment
decisions solely upon, such information as has been provided to the
undersigned by the Partnership, and the undersigned has not relied
upon any other information, literature or any oral communications.
The undersigned was not formed for the
-2-
<PAGE>
specific purpose of acquiring an interest in the Partnership.
(viii) The undersigned acknowledges that (i) the Common Units to be issued
to the undersigned have not been registered under the Securities
Act or state securities laws by reason of a specific exemption or
exemptions from registration under the Securities Act and
applicable state securities laws, (ii) the Partnership's reliance
on such exemptions is predicated in part on the accuracy and
completeness of the representations and warranties of the
undersigned, (iii) such Common Units, therefore, cannot be resold
unless registered under the Securities Act and applicable state
securities laws, or unless an exemption from registration is
available, (iv) there is no public market for such Common Units and
(v) the Partnership has no obligation or intention to register such
Common Units for resale under the Securities Act or any state
securities laws or to take any action that would make available any
exemption from the registration requirements of such laws. The
undersigned hereby acknowledges that because of the restrictions on
transfer or assignment of such Common Units to be issued which are
set forth in this Acknowledgment and Agreement and in the
Partnership Agreement, the undersigned may have to bear the
economic risk of the investment commitment evidenced by this
Acknowledgment and Agreement and any Common Units acquired as
contemplated by this Acknowledgment and Agreement for an indefinite
period of time, and that the Common Units by their terms will not
be exchangable at the request of the holder thereof for Common
Shares of the Company prior to the first (1st) anniversary of their
issuance.
(ix) The address of the undersigned's principal place of business is set
forth below. The undersigned does not have any present intention
of becoming a resident of any country, state or jurisdiction other
than the country and state in which its present principal place of
business is sited.
The undersigned has duly executed and delivered this Acknowledgment and
Agreement by Additional Limited Partner as of the 22nd day of April, 1999.
THE NARDI GROUP, L.L.C.
c/o Stephen J. Nardi
4100 Madison Street
-3-
<PAGE>
Hillsdale, Illinois 60162
By: /s/ Stephen J. Nardi
----------------------------------------
Title:
Name: Stephen J. Nardi
-------------------------------------
Title: President and CEO
-------------------------------------
By acceptance hereof, Prime Group Realty Trust, as Managing General
Partner of the Partnership, approves and accepts the admittance of The Nardi
Group, L.L.C., a Delaware limited liability company, as an Additional Limited
Partner in Prime Group Realty, L.P., having the number of Common Units set
forth above.
PRIME GROUP REALTY TRUST
By: /s/ W. Michael Karnes
--------------------------------------
Name: W. Michael Karnes
--------------------------------------
Its: Executive Vice President
--------------------------------------
Date: April 22, 1999
--------------------------------------
-4-
<PAGE>
Exhibit 3.26
AMENDMENT NO. 23 TO AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF PRIME GROUP REALTY, L.P.
This AMENDMENT NO. 23 TO AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF PRIME GROUP REALTY, L.P. (this "Amendment") is made as of
May 17, 1999 by Prime Group Realty Trust, a Maryland real estate investment
trust ("PGRT"), as the Managing General Partner of Prime Group Realty, L.P.,
a Delaware limited partnership (the "Partnership"), and on behalf of the
other Partners (as hereinafter defined). Capitalized terms used but not
otherwise defined herein shall have the meanings given to such terms in the
Amended and Restated Agreement of Limited Partnership of the Partnership,
dated as of November 17, 1997, by and among PGRT and the other parties
signatory thereto, as amended thereafter (as so amended, the "Limited
Partnership Agreement").
W I T N E S S E T H:
WHEREAS, pursuant to Section 4.3.C. of the Limited Partnership
Agreement, the Managing General Partner may raise all or any portion of
Additional Funds required by the Partnership for the acquisition of
additional properties by accepting additional Capital Contributions,
including the issuance of Common Units for Capital Contributions that consist
of property or interests in property;
WHEREAS, pursuant to that certain Exchange Agreement dated as of
December 15, 1997 by and between H Group LLC, a Delaware limited liability
company ("HG"), and the Partnership (the "Exchange Agreement"), HG agreed,
among other things, to grant to the Partnership an option (the "First
Option") to exchange the Underlying Option (as defined in the Exchange
Agreement) for 220,000 Common Units of Limited Partner Interest (subject to
adjustment pursuant to the terms of the Exchange Agreement), which grant of
the First Option contemplated the transfer by the Partnership to HG of 5,000
Common Units of Limited Partner Interest on the date thereof and, subject to
the terms of the First Option, 5,000 Common Units of Limited Partner Interest
(subject to adjustment pursuant to the terms of the Exchange Agreement) on
the 15th day of each month thereafter (each such transfer a "First Option
Maintenance Transfer") for such number of months set forth in the Exchange
Agreement;
WHEREAS, the Partnership has agreed to the terms of the grant by HG of
the First Option set forth in the Exchange Agreement and desires to effect
the First Option Maintenance Transfer due on May 17, 1999;
WHEREAS, HG was admitted to the Partnership as an Additional Limited
Partner as of December 15, 1997 pursuant to Amendment No. 2 to the Limited
Partnership Agreement;
<PAGE>
WHEREAS, the Partners desire to amend the Limited Partnership Agreement
to reflect the increase in outstanding Common Units resulting from the
issuance of Common Units to HG in connection with the First Option
Maintenance Transfer due on May 17, 1999; and
WHEREAS, Sections 2.4 and 12.3 of the Limited Partnership Agreement
authorize, among other things, the Managing General Partner, as true and
lawful agent and attorney-in fact, to execute, swear to, acknowledge,
deliver, file and record this Amendment on behalf of each Partner that has
executed the Limited Partnership Agreement and on behalf of the Partnership.
NOW, THEREFORE, for good and adequate consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
Section 1. ACCEPTANCE OF CAPITAL CONTRIBUTION IN EXCHANGE FOR COMMON
UNITS. (a) PGRT, as Managing General Partner and on behalf of the
Partnership, hereby accepts the grant of the rights consisting of the First
Option during the eighteenth month of the term of the First Option from HG as
a Capital Contribution having a value on the date hereof of $100,000, in
exchange for 6576.0 Common Units of Limited Partner Interest which are hereby
issued by the Partnership to HG pursuant to Section 4.3.C. of the Limited
Partnership Agreement, and which are evidenced by Common Unit Certificate
No. 45 of the Partnership.
(b) Each of the Common Units of Limited Partner Interest issued to
HG pursuant to this SECTION 1 shall have the same terms and provisions of the
Common Units of Limited Partner Interest issued by the Partnership on
November 17, 1997 except that (i) the Exchange Rights relating thereto may be
exercised at any time after December 15, 1999 (as opposed to November 17,
1998) and (ii) such Common Units of Limited Partner Interest will be subject
to the Registration Rights Agreement dated as of December 15, 1997 by and
among PGRT, the Partnership and HG as opposed to the Registration Rights
Agreement entered into by PGRT and the Partnership on November 17, 1997.
Section 2. AMENDMENT OF EXHIBIT A TO THE LIMITED PARTNERSHIP AGREEMENT.
Exhibit A to the Limited Partnership Agreement is hereby amended and
restated to reflect the aforementioned change(s) by deleting Exhibit A
attached thereto in its entirety, and by attaching in lieu thereof a
replacement exhibit in the form of EXHIBIT A attached hereto. From and after
the effectiveness of this Amendment, the amended and restated EXHIBIT A
attached hereto shall be the only Exhibit A to the Limited Partnership
Agreement, unless and until it is hereafter further amended.
Section 3. REFERENCE TO AND EFFECT ON THE LIMITED PARTNERSHIP AGREEMENT.
-2-
<PAGE>
A. The Limited Partnership Agreement is hereby deemed to be
amended to the extent necessary to effect the matters contemplated by this
Amendment. Except as specifically provided for hereinabove, the provisions of
the Limited Partnership Agreement shall remain in full force and effect.
B. The execution, delivery and effectiveness of this Amendment
shall not operate (i) as a waiver of any provision, right or obligation of
the Managing General Partner, the other General Partner or any Limited
Partner under the Limited Partnership Agreement except as specifically set
forth herein or (ii) as a waiver or consent to any subsequent action or
transaction.
Section 4. APPLICABLE LAW. This Amendment shall be construed in
accordance with and governed by the laws of the State of Delaware, without
regard to the principles of conflicts of law.
[signature page follows]
-3-
<PAGE>
AMENDMENT NO. 23 TO AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF PRIME
GROUP REALTY, L.P.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the date first written above.
MANAGING GENERAL PARTNER:
PRIME GROUP REALTY TRUST, a
Maryland real estate investment trust
By: /s/ W. Michael Karnes
-------------------------------------
Name: W. Michael Karnes
Title: Executive Vice President
LIMITED PARTNERS:
Each Limited Partner hereby executes
this Amendment to the Limited
Partnership Agreement.
By: PRIME GROUP REALTY TRUST, a
Maryland real estate investment
trust, as attorney-in fact
By: /s/ W. Michael Karnes
---------------------------------
Name: W. Michael Karnes
Title: Executive Vice President
-4-
<PAGE>
EXHIBIT A (*)
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
MANAGING GENERAL PARTNER COMMON UNITS CONTRIBUTION
- ------------------------ ------------ ------------
<S> <C> <C>
Prime Group Realty Trust 15,136,488 (**)
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Attn: Richard S. Curto
James F. Hoffman
GENERAL PARTNER
- ---------------
The Nardi Group, L.L.C. 927,100 $18,542,000
c/o Stephen J. Nardi
4100 Madison Street
Hillside, IL 60162
LIMITED PARTNERS
- ----------------
The Nardi Group, L.L.C. 210,813 $3,143,009
c/o Stephen J. Nardi
4100 Madison Street
Hillside, IL 60162
Edward S. Hadesman 388,677 $7,773,540
Trust Dated May 22, 1992
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Grandville/Northwestern 9,750 $195,000
Management Corporation
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
LIMITED PARTNERS (CONT'D) COMMON UNITS CONTRIBUTION
- ------------------------- ------------ ------------
<S> <C> <C>
Carolyn B. Hadesman 54,544 $1,090,880
</TABLE>
- --------------------
(*) As amended by Amendment No. 23 to the Amended and Restated Agreement of
Limited Partnership of Prime Group Realty, L.P.
(**) This amount shall be inserted by the Managing General Partner.
<PAGE>
EXHIBIT A - CONT'D
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
LIMITED PARTNERS (CONT'D) COMMON UNITS CONTRIBUTION
- ------------------------- ------------ ------------
<S> <C> <C>
Lisa Hadesman 1991 Trust 169,053 $3,381,060
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Cynthia Hadesman 1991 Trust 169,053 $3,381,060
c/o Edward S. Hadesman
2500 North Lakeview, Unit 1401
Chicago, IL 60614
Tucker B. Magid 33,085 $661,700
545 Ridge Road
Highland Park, IL 60035
Frances S. Shubert 28,805 $576,100
511 Lynn Terrace
Waukegan, IL 60085
Grandville Road Property, Inc. 7,201 $144,020
c/o Ms. Frances S. Shubert
511 Lynn Terrace
Waukegan, IL 60085
Sky Harbor Associates 62,149 $1,242,980
c/o Howard I. Bernstein
6541 North Kilbourn
Lincolnwood, IL 60646
Jeffrey A. Patterson 110,000 $2,200,000
c/o Prime Group Realty Trust
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Primestone Investment Partners, L.P. 7,944,893 (**)
c/o The Prime Group, Inc.
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Attn: Paul A. Roehri
</TABLE>
- --------------------
(**) This amount shall be inserted by the Managing General Partner.
<PAGE>
EXHIBIT A - CONT'D
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
LIMITED PARTNERS (CONT'D) COMMON UNITS CONTRIBUTION
- ------------------------- ------------ ------------
<S> <C> <C>
Prime Group VI, L.P. 304,097 $6,050,500
c/o The Prime Group, Inc.
77 West Wacker Drive
Suite 3900
Chicago, IL 60601
Attn: Michael W. Reshcke
Robert J. Rudnik
H Group LLC 102,139 $1,700,000
c/o Heitman Financial Ltd.
180 N. LaSalle
Suite 3600
Chicago, IL 60601
Attn: Norman Perlmutter
Ray R. Grinvalds 5,216 $104,320
217 Deer Valley Drive
Barrington, IL 60010
Warren H. John 37,259 $745,180
1730 N. Clark Street
Chicago, IL 60614
</TABLE>
<PAGE>
EXHIBIT A - CONT'D
PARTNERS, NUMBER OF UNITS AND CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
NUMBER OF CAPITAL
MANAGING GENERAL PARTNER PREFERRED UNITS CONTRIBUTION
- ------------------------ --------------- ------------
<S> <C> <C>
Prime Group Realty Trust 2,000,000 (**)
77 West Wacker Drive Convertible Preferred
Suite 3900 Units
Chicago, IL 60601
Attn: Richard S. Curto
James F. Hoffman
Prime Group Realty Trust 4,000,000 (**)
77 West Wacker Drive Series B Preferred Units
Suite 3900
Chicago, IL 60601
Attn: Richard S. Curto
James F. Hoffman
</TABLE>
- --------------------
(**) This amount shall be inserted by the Managing General Partner.
<PAGE>
Exhibit 4.1
==============================================================================
PRIME GROUP REALTY TRUST
TO
BANKERS TRUST COMPANY,
as Indenture Trustee
----------
FORM
OF
INDENTURE
Dated as of ____________, ____
Providing for Issuance of Senior
Debt Securities in Series
==============================================================================
<PAGE>
PRIME GROUP REALTY TRUST
Certain Sections of this Indenture relating to
Sections 310 through 318, inclusive, of the
Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
<S> <C>
(S) 310(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .609
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .609
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 608, 610
(S) 311(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .613
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .613
(S) 312(a). . . . . . . . . . . . . . . . . . . . . . . . . . .701, 702(a)
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 702(b)
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 702(c)
(S) 313(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703(a)
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703(a)
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703(a)
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703(b)
(S) 314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 704
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1008
(b) . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 102
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 102
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(d) . . . . . . . .. . . . . . . . . . . . . . . . . Not Applicable
(e) . . . . . . . .. . . . . . . . . . . . . . . . . . . . . .. 102
(S) 315(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 601
(b) . . . . . . . .. . . . . . . . . . . . . . . . . . . . . .. 602
(c) . . . . . . . .. . . . . . . . . . . . . . . . . . . . . .. 601
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . 601
(e) . . . . . . .. . . . . . . . . . . . . . . . . . . . . . .. 514
</TABLE>
-i-
<PAGE>
<TABLE>
<S> <C>
(S) 316(a) (last sentence) . . . . . . . . . . . . . . 101 ("Outstanding")
(a)(1)(A) . . . . . . . . . . . . . . . . . . . . . . . . .502, 512
(a)(1)(B) . . . . . . . . . . . . . . . . . . . . . . . . . . . 513
(a)(2). . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 508
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .104(c)
(S) 317(a)(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
(a)(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 504
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1003
(S) 318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
</TABLE>
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Indenture.
-ii-
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE ONE
Definitions and Other Provisions of General Application . . . . . . . . . 1
Section 101. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . 1
Section 102. COMPLIANCE CERTIFICATES AND OPINIONS. . . . . . . . . . . 8
Section 103. FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE. . . . . 9
Section 104. ACTS OF HOLDERS; RECORD DATES . . . . . . . . . . . . . . 9
Section 105. NOTICES, ETC., TO INDENTURE TRUSTEE AND COMPANY . . . . .10
Section 106. NOTICE TO HOLDERS; WAIVER . . . . . . . . . . . . . . . .11
Section 107. CONFLICT WITH TRUST INDENTURE ACT . . . . . . . . . . . .11
Section 108. EFFECT OF HEADINGS AND TABLE OF CONTENTS. . . . . . . . .11
Section 109. SUCCESSORS AND ASSIGNS. . . . . . . . . . . . . . . . . .12
Section 110. SEPARABILITY CLAUSE . . . . . . . . . . . . . . . . . . .12
Section 111. BENEFITS OF INDENTURE . . . . . . . . . . . . . . . . . .12
Section 112. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . .12
Section 113. LEGAL HOLIDAYS. . . . . . . . . . . . . . . . . . . . . .12
ARTICLE TWO
Security Forms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
Section 201. FORMS GENERALLY . . . . . . . . . . . . . . . . . . . . .13
Section 202. FORM OF FACE OF SECURITY. . . . . . . . . . . . . . . . .13
Section 203. FORM OF REVERSE OF SECURITY . . . . . . . . . . . . . . .15
Section 205. FORM OF INDENTURE TRUSTEE'S CERTIFICATE OF
AUTHENTICATION. . . . . . . . . . . . . . . . . . . . . .24
ARTICLE THREE
The Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24
Section 301. AMOUNT UNLIMITED; ISSUABLE IN SERIES. . . . . . . . . . .24
Section 302. DENOMINATIONS . . . . . . . . . . . . . . . . . . . . . .27
Section 303. EXECUTION, AUTHENTICATION, DELIVERY AND DATING. . . . . .27
Section 304. TEMPORARY SECURITIES. . . . . . . . . . . . . . . . . . .29
Section 305. REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE;
RESTRICTIONS ON TRANSFER. . . . . . . . . . . . . . . . .30
Section 306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES. . . . .36
Section 307. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED. . . . . .37
Section 308. PERSONS DEEMED OWNERS.. . . . . . . . . . . . . . . . . .39
Section 309. CANCELLATION. . . . . . . . . . . . . . . . . . . . . . .39
Section 310. COMPUTATION OF INTEREST . . . . . . . . . . . . . . . . .39
Section 311. CUSIP NUMBERS . . . . . . . . . . . . . . . . . . . . . .40
</TABLE>
-iii-
<PAGE>
<TABLE>
<S> <C>
ARTICLE FOUR
Satisfaction and Discharge. . . . . . . . . . . . . . . . . . . . . . . .40
Section 401. SATISFACTION AND DISCHARGE OF INDENTURE . . . . . . . . .40
Section 402. APPLICATION OF TRUST MONEY. . . . . . . . . . . . . . . .41
ARTICLE FIVE
Events of Default and Remedies. . . . . . . . . . . . . . . . . . . . . .41
Section 501. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . .41
Section 502. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. . . .43
Section 503. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT
BY INDENTURE TRUSTEE. . . . . . . . . . . . . . . . . . .44
Section 504. INDENTURE TRUSTEE MAY FILE PROOFS OF CLAIM. . . . . . . .44
Section 505. INDENTURE TRUSTEE MAY ENFORCE CLAIMS WITHOUT
POSSESSION OF SECURITIES. . . . . . . . . . . . . . . . .45
Section 506. APPLICATION OF MONEY COLLECTED. . . . . . . . . . . . . .45
Section 507. LIMITATION ON SUITS . . . . . . . . . . . . . . . . . . .46
Section 508. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
PREMIUM AND INTEREST. . . . . . . . . . . . . . . . . . .46
Section 509. RESTORATION OF RIGHTS AND REMEDIES. . . . . . . . . . . .46
Section 510. RIGHTS AND REMEDIES CUMULATIVE. . . . . . . . . . . . . .47
Section 511. DELAY OR OMISSION NOT WAIVER. . . . . . . . . . . . . . .47
Section 512. CONTROL BY HOLDERS. . . . . . . . . . . . . . . . . . . .47
Section 513. WAIVER OF PAST DEFAULTS . . . . . . . . . . . . . . . . .48
Section 514. UNDERTAKING FOR COSTS . . . . . . . . . . . . . . . . . .48
ARTICLE SIX
The Indenture Trustee . . . . . . . . . . . . . . . . . . . . . . . . . .48
Section 601. CERTAIN DUTIES AND RESPONSIBILITIES . . . . . . . . . . .48
Section 602. NOTICE OF DEFAULTS. . . . . . . . . . . . . . . . . . . .49
Section 603. CERTAIN RIGHTS OF INDENTURE TRUSTEE . . . . . . . . . . .49
Section 604. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
SECURITIES. . . . . . . . . . . . . . . . . . . . . . . .51
Section 605. MAY HOLD SECURITIES AND SERVE AS INDENTURE TRUSTEE
UNDER OTHER INDENTURES. . . . . . . . . . . . . . . . . .51
Section 606. MONEY HELD IN TRUST . . . . . . . . . . . . . . . . . . .51
Section 607. COMPENSATION AND REIMBURSEMENT. . . . . . . . . . . . . .51
Section 608. DISQUALIFICATION; CONFLICTING INTERESTS . . . . . . . . .52
Section 609. CORPORATE INDENTURE TRUSTEE REQUIRED; ELIGIBILITY . . . .52
Section 610. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR . . . .53
Section 611. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. . . . . . . . . .54
</TABLE>
-iv-
<PAGE>
<TABLE>
<S> <C>
Section 612. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS. . . . . . . . . . . . . . . . . . . . . . . . .56
Section 613. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY . . . .56
Section 614. INVESTMENT OF CERTAIN PAYMENTS HELD BY THE INDENTURE
TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . .56
Section 615. RIGHTS AND PROTECTIONS OF INDENTURE TRUSTEE THAT
ALSO ACTS AS PAYING AGENT OR SECURITY REGISTRAR . . . . .57
Section 616. APPOINTMENT OF AUTHENTICATING AGENT . . . . . . . . . . .57
ARTICLE SEVEN
Holders' Lists and Reports by Indenture Trustee and Company . . . . . . .59
Section 701. COMPANY TO FURNISH INDENTURE TRUSTEE NAMES AND
ADDRESSES OF HOLDERS. . . . . . . . . . . . . . . . . . .59
Section 702. PRESERVATION OF INFORMATION; COMMUNICATIONS TO
HOLDERS . . . . . . . . . . . . . . . . . . . . . . . . .59
Section 703. REPORTS BY INDENTURE TRUSTEE. . . . . . . . . . . . . . .59
Section 704. REPORTS BY COMPANY. . . . . . . . . . . . . . . . . . . .60
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease. . . . . . . . . . .60
Section 801. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS. . .60
Section 802. SUCCESSOR SUBSTITUTED . . . . . . . . . . . . . . . . . .61
Section 803. OFFICERS' CERTIFICATE AND OPINION OF COUNSEL. . . . . . .61
ARTICLE NINE
Supplemental Indentures . . . . . . . . . . . . . . . . . . . . . . . . .61
Section 901. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS. . . .61
Section 902. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.. . . . .63
Section 903. EXECUTION OF SUPPLEMENTAL INDENTURES. . . . . . . . . . .64
Section 904. EFFECT OF SUPPLEMENTAL INDENTURES . . . . . . . . . . . .64
Section 905. CONFORMITY WITH TRUST INDENTURE ACT . . . . . . . . . . .64
Section 906. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES. . . .64
ARTICLE TEN
Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65
Section 1001. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST. . . . . . . .65
Section 1002. MAINTENANCE OF OFFICE OR AGENCY . . . . . . . . . . . . .65
Section 1003. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST . . . .65
Section 1004. PAYMENT OF TAXES AND OTHER CLAIMS . . . . . . . . . . . .67
Section 1005. MAINTENANCE OF PROPERTIES . . . . . . . . . . . . . . . .67
Section 1006. TRUST EXISTENCE . . . . . . . . . . . . . . . . . . . . .67
Section 1007. LIMITATION UPON LIENS . . . . . . . . . . . . . . . . . .68
</TABLE>
-v-
<PAGE>
<TABLE>
<S> <C>
Section 1008. LIMITATION UPON SALES AND LEASEBACKS. . . . . . . . . . .70
Section 1009. WAIVER OF CERTAIN COVENANTS . . . . . . . . . . . . . . .71
Section 1010. COMPLIANCE CERTIFICATE. . . . . . . . . . . . . . . . . .71
ARTICLE ELEVEN
Redemption of Securities. . . . . . . . . . . . . . . . . . . . . . . . .72
Section 1101. APPLICABILITY OF ARTICLE. . . . . . . . . . . . . . . . .72
Section 1102. ELECTION TO REDEEM: NOTICE TO INDENTURE TRUSTEE . . . . .72
Section 1103. SELECTION BY INDENTURE TRUSTEE OF SECURITIES TO BE
REDEEMED. . . . . . . . . . . . . . . . . . . . . . . . .72
Section 1104. NOTICE OF REDEMPTION. . . . . . . . . . . . . . . . . . .73
Section 1105. DEPOSIT OF REDEMPTION PRICE . . . . . . . . . . . . . . .74
Section 1106. SECURITIES PAYABLE ON REDEMPTION DATE . . . . . . . . . .74
Section 1107. SECURITIES REDEEMED IN PART . . . . . . . . . . . . . . .75
ARTICLE TWELVE
Sinking Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .75
Section 1201. APPLICABILITY OF ARTICLE. . . . . . . . . . . . . . . . .75
Section 1202. SATISFACTION OF SINKING FUND PAYMENTS WITH
SECURITIES. . . . . . . . . . . . . . . . . . . . . . . .75
Section 1203. REDEMPTION OF SECURITIES FOR SINKING FUND . . . . . . . .76
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance. . . . . . . . . . . . . . . . . . . .76
Section 1301. APPLICABILITY OF ARTICLE; COMPANY'S OPTION TO EFFECT
DEFEASANCE OR COVENANT DEFEASANCE . . . . . . . . . . . .76
Section 1302. DEFEASANCE AND DISCHARGE. . . . . . . . . . . . . . . . .76
Section 1303. COVENANT DEFEASANCE . . . . . . . . . . . . . . . . . . .77
Section 1304. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE . . . . .77
Section 1305. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO
BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS. . . . .79
Section 1306. REINSTATEMENT . . . . . . . . . . . . . . . . . . . . . .80
Section 1307. QUALIFYING INDENTURE TRUSTEE. . . . . . . . . . . . . . .80
ARTICLE FOURTEEN
Immunity of Organizers, Promoters, Shareholders, Officers, Trustees
and Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .81
Section 1401. EXEMPTION FROM INDIVIDUAL LIABILITY . . . . . . . . . . .81
</TABLE>
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NOTE: This table of contents shall not, for any purpose,
be deemed to be a part of the Indenture.
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INDENTURE, dated as of ___________, _________________ , between
Prime Group Realty Trust, a real estate investment trust duly organized and
existing under the laws of the State of Maryland (herein called the
"COMPANY"), having its principal office at 77 West Wacker Drive, Suite 3900,
Chicago, Illinois 60601, and Bankers Trust Company, a New York banking
corporation, as Indenture Trustee (herein called the "INDENTURE TRUSTEE").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its senior
unsubordinated unsecured debentures, notes or other evidences of indebtedness
(herein called the "SECURITIES"), to be issued in one or more series as
provided in this Indenture.
The Company has duly authorized the execution and delivery of this
Indenture to provide, among other things, for the authentication, delivery
and administration of the Securities.
All things necessary to make this Indenture a valid agreement of
the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or each series
thereof, as follows:
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. DEFINITIONS.
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 generally accepted accounting
principles, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as are
generally accepted at the date of such computation in the United States of
America; and
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(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Indenture; and
(5) 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.
"ACT", when used with respect to any Holder, has the meaning
specified in SECTION 104(a).
"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 the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities or other ownership
interests, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"ATTRIBUTABLE DEBT", in respect of any Sale and Leaseback
Transaction, means, as of the time of determination, the total obligation
(discounted to present value at the rate per annum equal to the discount rate
which would be applicable to a capital lease obligation with like term in
accordance with generally accepted accounting principles) of the lessee for
rental payments (other than amounts required to be paid on account of
property taxes, maintenance, repairs, insurance, water rates and other items
which do not constitute payments for property rights) during the remaining
portion of the initial term of the lease included in such Sale and Leaseback
Transaction.
"AUTHENTICATING AGENT" means any Person authorized by the Indenture
Trustee pursuant to SECTION 615 to act on behalf of the Indenture Trustee to
authenticate Securities of one or more series.
"BOARD OF TRUSTEES" means either the board of trustees of the
Company or any duly authorized committee of that board.
"BOARD RESOLUTION" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Trustees and to be in full force and effect on the date of
such certification, and delivered to the Indenture Trustee.
"BOOK-ENTRY SECURITY" means a Security in the form prescribed in
SECTION 204 evidencing all or part of a series of Securities, issued to the
Depositary for such series or its nominee, and registered in the name of such
Depositary or such nominee.
"BUSINESS DAY", when used with respect to any Place of Payment,
means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day
on which banking
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institutions in that Place of Payment or the city in which the principal
corporate trust office of the Trustee is located 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 Exchange Act, or, if at any time
after the execution of this instrument 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 Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"COMPANY REQUEST" or "COMPANY ORDER" means a written request or
order signed in the name of the Company by its Chairman of the Board, its
Chief Executive Officer, its President, its Chief Financial Officer, or a
Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary
or an Assistant Secretary, and delivered to the Indenture Trustee.
"CONSOLIDATED NET ASSETS" means the aggregate amount of assets
(less applicable reserves and other properly deductible items) after
deducting therefrom all current liabilities (excluding any indebtedness for
money borrowed having a maturity of less than 12 months from the date of the
most recent consolidated balance sheet of the Company but which by its terms
is renewable or extendable beyond 12 months from such date at the option of
the borrower) all as set forth on the most recent consolidated balance sheet
of the Company and computed in accordance with generally accepted accounting
principles.
"CORPORATE TRUST OFFICE" means the principal office of the
Indenture Trustee at which at any particular time its corporate trust
business shall be principally administered, which office at the date of
original execution of this Indenture is located at Four Albany Street, New
York, New York 10006, Attention: Corporate Trust and Agency Group or at any
other time at such other address as the Indenture Trustee may designate from
time to time by notice to the Holders, except that, with respect to
presentation of the Securities for payment or registration of transfers or
exchanges and the location of the register, such term means the office or
agency of the Indenture Trustee at which at any particular time its corporate
agency business shall be conducted.
"DEBT" has the meaning specified in SECTION 1007.
"DEFAULTED INTEREST" has the meaning specified in SECTION 307.
"DEFINITIVE SECURITY" means Securities that are in the form of the
Securities set forth in ARTICLE TWO, that do not include the information
called for in SECTION 204.
"DEPOSITARY" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more Book-Entry
Securities, the Person designated as
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Depositary for such series by the Company pursuant to SECTION 301(17), which
Person shall be a clearing agency registered under the Exchange Act; and if
at any time there is more than one such Person, "DEPOSITARY" as used with
respect to the Securities of any series shall mean the Depositary with
respect to the Securities of such series.
"EVENT OF DEFAULT" has the meaning specified in SECTION 501.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXCHANGE OFFER" means any registered exchange offer made by the
Company soley to facilitate the exchange of an Outstanding series of
Securities for the related Exchange Securities.
"EXCHANGE SECURITIES" means any Securities issued by the Company
solely to facilitate a registered exchange of such Securities for any series
of Securities with substantially indentical terms previously issued in a
private placement of such Outstanding Securities.
"FUNDED DEBT" means all Debt having a maturity of more than 12
months from the date as of which the determination is made or having a
maturity of 12 months or less but by its terms being renewable or extendable
beyond 12 months from such date at the option of the borrower, but excluding
any such Debt owed to the Company or a Subsidiary.
"HOLDER" means a Person in whose name a Security is registered in
the Security Register.
"INDENTURE" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions
hereof, including, for all purposes of this instrument, and any such
supplemental indenture, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern this instrument and any such supplemental
indenture, respectively. The term "Indenture" shall also include the forms
and terms of particular series of Securities established as contemplated by
SECTION 301.
"INDENTURE TRUSTEE" means the Person named as the "Indenture
Trustee" in the first paragraph of this instrument until a successor
Indenture Trustee shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter "Indenture Trustee" shall mean
or include each Person who is then a Indenture Trustee hereunder, and if at
any time there is more than one such Person, "Indenture Trustee" as used with
respect to the Securities of any series shall mean the Indenture Trustee with
respect to Securities of that series.
"INDEXED SECURITY" means any Security which provides that the
principal amount thereof payable at Stated Maturity may be more or less than
the principal face amount thereof at original issuance.
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"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.
"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.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman
of the Board, the Chief Executive Officer, the President, the Chief Financial
Officer, or a Vice President, and by the Treasurer, an Assistant Treasurer,
the Secretary or an Assistant Secretary, of the Company, and delivered to the
Indenture Trustee.
"OPINION OF COUNSEL" means a written opinion of counsel, in form
and substance reasonably acceptable to the Indenture Trustee, who may be
counsel for the Company, and who shall be acceptable to the Indenture
Trustee.
"ORIGINAL ISSUE DISCOUNT SECURITY" means any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant
to SECTION 502.
"OUTSTANDING", when used with respect to Securities, means, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore canceled by the Indenture Trustee or
delivered to the Indenture Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Indenture Trustee or
any Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities; PROVIDED, that if such
Securities are to be redeemed, notice of such redemption has been duly given
pursuant to SECTION 1104 or provision therefor satisfactory to the Indenture
Trustee has been made;
(iii) Securities, except to the extent provided in SECTIONS 1302
and 1303, with respect to which the Company has effected defeasance or
covenant defeasance as provided in ARTICLE THIRTEEN; and
(iv) Securities which have been paid pursuant to SECTION 306 or
in exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture,
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other than any such Securities in respect of which there shall have been
presented to the Indenture 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, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action 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, (i) the principal amount
of an Original Issue Discount Security that shall be deemed to be Outstanding
shall be the amount of the principal thereof that would be due and payable as
of the date of such determination upon acceleration of the Maturity thereof
pursuant to SECTION 502, (ii) the principal amount of a Security denominated
in one or more foreign currencies or currency units shall be the U.S. dollar
equivalent, determined in the manner provided as contemplated by SECTION 301
on the date of original issuance of such Security, of the principal amount
(or, in the case of an Original Issue Discount Security, the U.S. dollar
equivalent on the date of original issuance of such Security of the amount
determined as provided in (i) above) of such Security, (iii) the principal
amount of any Indexed Security 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 principal face amount of such Indexed
Security at original issuance, unless otherwise provided with respect to such
Security pursuant to SECTION 301, and (iv) except for the purpose of making
the calculations required by Section 313 of the Trust Indenture Act,
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
Indenture Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent, waiver or other action,
only Securities which a Responsible Officer of the Indenture 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 Indenture 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 or any premium or interest on any Securities on behalf of
the Company.
"PERSON" means any individual, corporation, partnership, limited
liability company, joint venture, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"PLACE OF PAYMENT", when used with respect to the Securities of any
series, means the place or places where the principal of and any premium and
interest on the Securities of that series are payable as specified as
contemplated by SECTIONS 301 and 1002.
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"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 306 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.
"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, means the price at which it is to be redeemed pursuant to this
Indenture.
"REGULAR RECORD DATE" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for
that purpose as contemplated by SECTION 301.
"RESPONSIBLE OFFICER", shall mean when used with respect to the
Indenture Trustee any officer within the Corporate Trust Office including any
Vice President, managing director, assistant vice president, secretary,
assistant secretary, treasurer or assistant treasurer or any other officer of
the Indenture Trustee customarily performing functions similar to those
performed by any of the above designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because
of such officer's knowledge and familiarity with the particular subject.
"SALE AND LEASEBACK TRANSACTION" means any arrangement with any
bank, insurance company or other lender or investor (other than the Company
or another Subsidiary) providing for the leasing by the Company or any
Subsidiary of any property (except a lease for a temporary period not to
exceed three years by the end of which it is intended that the use of such
property by the lessee will be discontinued), which was or is owned or leased
by the Company or a Subsidiary and which has been or is to be sold or
transferred, more than 120 days after the acquisition or the completion of
construction and commencement of full operation thereof, by the Company or
such Subsidiary to such lender or investor or to any Person to whom funds
have been or are to be advanced by such lender or investor on the security of
such property.
"SECURITY" or "SECURITIES" has the meaning stated in the first
recital of this Indenture and more particularly means any Securities
authenticated and delivered under this Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITY REGISTER" and "SECURITY REGISTRAR" have the respective
meanings specified in SECTION 305.
"SPECIAL RECORD DATE" for the payment of any Defaulted Interest
means a date fixed by the Indenture Trustee pursuant to SECTION 307.
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"STATED MATURITY", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date
specified in such Security as the fixed date on which the principal of such
Security or such installment of principal or interest is due and payable.
"SUBSIDIARY" means any corporation, partnership or limited
liability company of which at least a majority of the outstanding voting
stock, partnership interest or limited liability company interest, as the
case may be, is at the time directly or indirectly owned by the Company, or
by one or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For purposes of this defintion, "voting stock" means stock
having by the terms thereof ordinary voting power for the election of
directors of such corporation (irrespective of whether or not at the time
stock of any other class or classes of such corporation shall have or might
have voting power by reason of the happening of any contingency).
"TRANSFER RESTRICTED SECURITIES" means Securities that have been or
are required to bear the legend set forth in SECTION 305(H) hereof.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; PROVIDED,
HOWEVER, that in the event the Trust Indenture Act of 1939 is amended after
such date, "Trust Indenture Act" means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 as so amended.
"U.S. GOVERNMENT OBLIGATIONS" has the meaning specified in SECTION
1304(1).
"VICE PRESIDENT", when used with respect to the Company or the
Indenture Trustee, means any vice president, whether or not designated by a
number or a word or words added before or after the title "vice president",
including, without limitation, "executive vice president" and "senior vice
president."
Section 102. COMPLIANCE CERTIFICATES AND OPINIONS.
Upon any application or request by the Company to the Indenture
Trustee to take any action under any provision of this Indenture (except for
the initial issuances of Securities hereunder), the Company shall furnish to
the Indenture Trustee such certificates and opinions as may be required under
the Trust Indenture Act. Each such certificate or opinion shall be given in
the form of an Officers' Certificate, if to be given by an officer of the
Company, or an Opinion of Counsel, if to be given by counsel, and shall
comply with the requirements of the Trust Indenture Act and any other
requirements set forth in this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
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(2) 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;
(3) 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 covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 103. FORM OF DOCUMENTS DELIVERED TO INDENTURE 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
representations by counsel or an opinion of counsel, unless such officer
knows, or in the exercise of reasonable care should know, that the
certificate, representations or opinion with respect to the matters upon
which such officer's certificate or opinion is based are erroneous. Any such
certificate or representations of counsel 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 with respect
to such matters 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 104. ACTS OF HOLDERS; RECORD DATES.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made 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 Indenture 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
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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 (subject to SECTION 603) conclusive in favor of the Indenture
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 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 Indenture Trustee
deems sufficient.
(c) The Company may fix any day as the record date for the
purpose of determining the Holders of Securities of any series entitled to
give or take any request, demand, authorization, direction, notice, consent,
waiver or other action, or to vote on any action, authorized or permitted to
be given or taken by Holders of Securities of such series. If not set by the
Company prior to the first solicitation of a Holder of Securities of such
series made by any Person in respect of any such action, or, in the case of
any such vote, prior to such vote, the record date for any such action or
vote shall be the 30th day (or, if later, the date of the most recent list of
Holders required to be provided pursuant to SECTION 701) prior to such first
solicitation or vote, as the case may be. With regard to any record date for
action to be taken by the Holders of one or more series of Securities, only
the Holders of Securities of such series on such date (or their duly
designated proxies) shall be entitled to give or take, or vote on, the
relevant action.
(d) The ownership of Securities shall be proved by the Security
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
Indenture Trustee or the Company in reliance thereon, whether or not notation
of such action is made upon such Security.
Section 105. NOTICES, ETC., TO INDENTURE 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,
(1) the Indenture Trustee by any Holder or by the Company shall
be sufficient for every purpose hereunder if made, given, furnished or filed
in writing to or with the Indenture Trustee at its Corporate Trust Office,
Attention: Corporate Trust and Agency Services.
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(2) the Company by the Indenture Trustee or by any Holder shall
be sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to the
Company addressed to it at the address of its principal office specified in
the first paragraph of this instrument or at any other address previously
furnished in writing to the Indenture Trustee by the Company, Attention:
President, with a copy to the Company at the address of its principal office
specified in the first paragraph of this instrument or at any other address
previously furnished in writing to the Trustee by the Company, Attention:
General Counsel.
Section 106. NOTICE TO HOLDERS; WAIVER.
Where this Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each
Holder affected by such event, at such Holder's address as it appears in the
Security Register, not later than the latest date (if any), and not earlier
than the earliest date (if any), prescribed for the giving of such notice. In
any case where notice to Holders is given by mail, neither the failure to
mail such notice, nor any defect in any notice so mailed, to any particular
Holder shall affect the sufficiency of such notice with respect to other
Holders. 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. 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 the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Indenture Trustee, but such filing shall not be a
condition precedent to the validity of any action taken in reliance upon such
waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the
Indenture Trustee shall constitute a sufficient notification for every
purpose hereunder.
Section 107. CONFLICT WITH TRUST INDENTURE ACT.
If any provision of this Indenture limits, qualifies or conflicts
with a provision of the Trust Indenture Act that is required under such Act
to be a part of and govern this Indenture, the provision of the Trust
Indenture Act shall control. If any provision of this Indenture modifies or
excludes any provision of the Trust Indenture Act that 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.
Section 108. EFFECT OF 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.
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Section 109. 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 110. SEPARABILITY CLAUSE.
In case any provision in this Indenture or in 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 111. BENEFITS OF INDENTURE.
Nothing in this Indenture or in the Securities, express 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 112. GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
Section 113. LEGAL HOLIDAYS.
In any case where any Interest Payment Date, Redemption 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 the Securities (other than a provision of the Securities of
any series which specifically states that such provision shall apply in lieu
of this Section)) payment of interest or principal (and premium, if any) need
not be made at such Place of Payment on such day, 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 the Interest Payment Date, the Redemption Date, or at
the Stated Maturity or Maturity; PROVIDED, that no interest shall accrue for
the intervening period.
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<PAGE>
ARTICLE TWO
Security Forms
Section 201. FORMS GENERALLY.
The Securities of each series shall be in substantially the form
set forth in this Article, or in such other 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 Depositary
therefor or as may, consistently herewith, be determined by the officers
executing such Securities, as evidenced by their execution of the Securities.
If the form of Securities of any series is established by, or by action
taken pursuant to, a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of
the Company and delivered to the Indenture Trustee at or prior to the
delivery of the Company Order contemplated by SECTION 303 for the
authentication and delivery of such Securities.
The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner
permitted by the rules of any securities exchange on which the Securities may
be listed, all as determined by the officers executing such Securities, as
evidenced by their execution of such Securities.
Section 202. FORM OF FACE OF SECURITY.
[INSERT ANY LEGEND REQUIRED BY THE INTERNAL REVENUE CODE AND THE
REGULATIONS.]
[INSERT ANY LEGEND REQUIRED BY THE DEPOSITARY, IF APPLICABLE.]
PRIME GROUP REALTY TRUST
[INSERT DESIGNATION OF THE SERIES OF SECURITY.]
No. ___________________ $ ___________________
CUSIP No. ___________________
Prime Group Realty Trust, a real estate investment trust duly
[organized and existing] under the laws of Maryland (herein called the
"COMPANY", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
___________________, or registered assigns, the principal sum
[if BOOK-ENTRY SECURITY,
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<PAGE>
INSERT -- set forth above or such other principal sum on the Schedule
attached hereto (which shall not exceed $_____________] [of _____________
Dollars] on _____________ [IF THE SECURITY IS TO BEAR INTEREST PRIOR TO
MATURITY, INSERT --, and to pay interest thereon from _____________ or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually on _____________ and _____________ in each year,
commencing _____________, at the rate of ___% per annum, until the principal
hereof is paid or made available for payment [IF APPLICABLE, insert -- and (to
the extent that the payment of such interest shall be legally enforceable) at
the rate of ___% per annum on any overdue principal and premium and on any
overdue installment of interest]. The interest so payable, and punctually paid
or duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the _____________ or _____________
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Indenture Trustee, notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of this
series may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture].
[IF THE SECURITY IS NOT TO BEAR INTEREST PRIOR TO MATURITY, INSERT --
The principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal of this Security shall bear
interest at the rate of ___% per annum (to the extent that the parment of
such interest shall be legally enforceable), which shall accrue from the date
of such default in payment to the date payment of such principal has been made
or duly provided for. Interest on any overdue principal shall be payable on
demand. [Any such interest on any overdue principal that is not so paid on
demand shall bear interest at the rate of ___% per annum (to the extent that
the payment of such interest shall be legally enforceable), which shall accrue
from the date of such demand for payment to the date payment of such interest
has been made or duly provided for, and such interest shall also be payable on
demand.]]
Payment of the principal of (and premium, if any on) and [IF
APPLICABLE, INSERT -- and any such interest on] this Security will be made at
the office or agency of the Company maintained for that purpose
in _____________, in such coin or currency of [the United States of America]
as at the time of payment is legal tender for payment of public and private
debts [IF APPLICABLE, INSERT -- ; PROVIDED, HOWEVER, that at the option of
the Company payment of interest may be made by check mailed to the address
of the Person entitled thereto as such address shall appear in the Security
Register or by wire transfer to an account maintained by the Person entitled
thereto as specified in the Security Register, PROVIDED that such Person shall
have given the Indenture Trustee written wire instructions at least five
Business Days prior to the applicable Interest Payment Date.]
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<PAGE>
[IF THE SECURITY IS PAYABLE IN A FOREIGN CURRENCY, INSERT -- THE
APPROPRIATE PROVISION.]
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed
by the Indenture Trustee referred to on the reverse hereof by manual
signature, this Security shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal.
PRIME GROUP REALTY TRUST
By _______________________________
Title:
Attest:
_______________________________
Title:
Section 203. FORM OF REVERSE OF SECURITY.
This Security is one of a duly authorized issue of securities of
the Company (herein called the "SECURITIES"), issued and to be issued in one
or more series under an Indenture, dated as of _____________, _____________
(herein, together with all indentures supplemental thereto, called the
"INDENTURE"), between the Company and _____________, as Indenture Trustee
(herein called the "INDENTURE TRUSTEE", which term includes any successor
indenture trustee under the Indenture). [This Security is one of a series
[, limited in aggregate principal amount to $..........] designated as
[__________] (herein called "[_________]), [created by a supplemental
indenture, dated as of ____________ (the "Supplemental Indenture"), duly
executed and delivered by the Company to such Indenture Trustee]. Reference
is hereby made to the Indenture for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Indenture Trustee and the Holders of the Securities and of the terms upon which
the Securities are, and are to be, authenticated and delivered.
[IF APPLICABLE, INSERT -- The Securities are redeemable, as a
whole or in part, at the option of the Company, at any time or from time to
time, on at least 30 days, but not more than 60 days, prior notice mailed to the
registered address of each holder of Securities. The redemption
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<PAGE>
prices will be equal to the greater of (1) 100% of the principal amount of
the Securities to be redeemed or (2) the sum of the present values of the
Remaining Scheduled Payments (as defined below) discounted, on a semiannual
basis (assuming a 360-day year consisting of twelve 30-day months), at a rate
equal to the sum of the applicable Treasury Rate (as defined below) plus __
basis points, plus accrued interest to the date of redemption.
"TREASURY RATE" means, with respect to any redemption date, the
rate per annum equal to the semiannual equivalent yield to maturity (computed
as of the second business day immediately preceding such redemption date) of
the Comparable Treasury Issue, assuming a price for the Comparable Treasury
Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such redemption date.
"COMPARABLE TREASURY ISSUE" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of such series of Securities to be redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt
securities of comparable maturity to the remaining term of such series of
Securities. "INDEPENDENT INVESTMENT BANKER" means one of the Reference
Treasury Dealers appointed by the Company.
"COMPARABLE TREASURY PRICE" means, with respect to any redemption
date, the average of the Reference Treasury Dealer Quotations for such
redemption date. "REFERENCE TREASURY DEALER QUOTATIONS" means, with respect
to each Reference Treasury Dealer and any redemption date, the average, as
determined by the Trustee, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal
amount) quoted in writing to the Trustee by such Reference Treasury Dealer at
3:30 p.m., New York City time, on the third business day preceding such
redemption date.
"REFERENCE TREASURY DEALER" means each of ___________ and
__________ and their respective successors. If any of the foregoing shall
cease to be a primary U.S. Government securities dealer (a "PRIMARY TREASURY
DEALER"), the Company shall substitute another nationally recognized
investment banking firm that is a Primary Treasury Dealer.
"REMAINING SCHEDULED PAYMENTS" means, with respect to Securities to
be redeemed, the remaining scheduled payments of principal of and interest on
such Securities that would be due after the related redemption date but for
such redemption. If such redemption date is not an interest payment date with
respect to such Securities, the amount of the next succeeding scheduled
interest payment on such Securities will be reduced by the amount of interest
accrued on such Securities to such redemption date.
On and after the redemption date, interest will cease to accrue on
the Securities or any portion of the Securities called for redemption (unless
the Company defaults in the payment of the redemption price and accrued
interest). On or before the redemption date, the Company will deposit with a
paying agent (or the Indenture Trustee) money sufficient to pay the
redemption price of and
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<PAGE>
accrued interest on the Securities to be redeemed on such date. If less than
all of the Securities of any series are to be redeemed, the Securities to be
redeemed shall be selected by the Indenture Trustee by such method as the
Indenture Trustee shall deem fair and appropriate.]
[IF APPLICABLE, INSERT -- The Securities of this series are
subject to redemption upon not less than 30 nor more than 60 days' notice by
mail, such 30 or 60 days, as the case may be, to be counted from the date notice
is mailed, [IF APPLICABLE, INSERT --(1) on ___________ in any year commencing
with the year __ and ending with the year __ through operation of the sinking
fund for this series at a Redemption Price equal to 100% of the principal
amount, and (2)] at any time [on or after ___________, ____], as a whole or in
part, at the election of the Company, [at Redemption Prices determined as
follows:] [at the following Redemption Prices (expressed as percentages of the
principal amount)]: If redeemed [on or before ___________, ____%, and if
redeemed] during the 12-month period beginning ___________ of the years
indicated,
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
---- ---------- ---- ----------
<S> <C> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to ___% of the principal amount,]
together in the case of any such redemption [IF APPLICABLE, INSERT -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on
the relevant Regular Record Dates or Special Record Dates referred to on the
face hereof, all as provided in the Indenture.]
[IF APPLICABLE, INSERT -- The Securities of this series are
subject to redemption upon not less than 30 nor more than 60 days' notice by
mail, such 30 or 60 days, as the case may be, to be counted from the date notice
is mailed, (1) on ___________ in any year commencing with the year ___________
and ending with the year ___________ through operation of the sinking fund for
this series at the Redemption Prices for redemption through operation of the
sinking fund (expressed as percentages of the principal amount) set forth in
the table below, and (2) at any time [on or after ___________ ], as a whole or
in part, at the election of the Company, at the Redemption Prices for
redemption otherwise than through operation of the sinking fund (expressed as
percentages of the principal amount) set forth in the table below: If redeemed
during the 12-month period beginning ___________ of the years indicated,
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<PAGE>
<TABLE>
<CAPTION>
Redemption Price Redemption Price for
For Redemption Redemption Otherwise
Through Operation Than Through Operation
Year of the Sinking Fund of the Sinking Fund
---- ------------------- ----------------------
<S> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to ___ % of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Regular Record Dates or Special Record Dates referred to on the face hereof,
all as provided in the Indenture.]
[Notwithstanding the foregoing, the Company may not, prior to
__________, redeem any Securities of this series as contemplated by
[Clause (2) of] the preceding paragraph as a part of, or in anticipation
of, any refunding operation by the application, directly or indirectly, of
moneys borrowed having an interest cost to the Company (calculated in
accordance with generally accepted financial practice) of less than ___ %
per annum.]
[The sinking fund for this series provides for the redemption on
__________ in each year beginning with the year ___ and ending with the year
___ of [not less than $ __________ ("mandatory sinking fund") and not more than]
$ __________ aggregate principal amount of Securities of this series.
Securities of this series acquired or redeemed by the Company otherwise than
through [mandatory] sinking fund payments may be credited against subsequent
[mandatory] sinking fund payments otherwise required to be made [in the inverse
order in which they become due].]
[IF THE SECURITIES DO NOT HAVE A SINKING FUND, THEN INSERT --
the Securities do not have the benefit of any sinking fund obligations.]
[IF THE SECURITY IS SUBJECT TO REDEMPTION, INSERT -- In the event
of redemption of this Security in part only, a new Security or Securities of
this series and of like tenor for the unredeemed portion hereof will be issued
in the name of the Holder hereof upon the cancellation hereof.]
[IF THE SECURITY IS NOT SUBJECT TO REDEMPTION, INSERT -- The
Securities of this series are not redeemable prior to Stated Maturity.]
[IF APPLICABLE, INSERT -- The Indenture contains provisions for
defeasance at any time of [the entire indebtedness of this Security] [and/or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance with certain conditions set forth in
the Indenture.]
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<PAGE>
[IF APPLICABLE, INSERT -- The Securities of this series are not
subject to [Section 1302 of the Indenture concerning the defeasance of the
indebtedness represented by this Security] [and/or] [Section 1303 of the
Indenture concerning covenant defeasance of this Security.]
[IF THE SECURITY IS NOT AN ORIGINAL ISSUE DISCOUNT SECURITY,
INSERT -- If an Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.]
[IF THE SECURITY IS AN ORIGINAL ISSUE DISCOUNT SECURITY, INSERT
- -- If an Event of Default with respect to Securities of this series shall occur
and be continuing, an amount of principal of the Securities of this series may
be declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- INSERT FORMULA FOR DETERMINING THE
AMOUNT. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and interest (in each
case to the extent that the payment of such interest shall be legally
enforceable), all of the Company's obligations in respect of the payment of the
principal of and premium and interest, if any, on the Securities of this series
shall terminate.]
[IF THE SECURITY IS AN INDEXED SECURITY, INSERT -- the appropriate
provision.]
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Company and the rights of the Holders of the Securities under the
Indenture at any time by the Company and the Indenture Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be adversely affected. The Indenture
also contains provisions permitting the Holders of specified percentages in
principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance
by the Company with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon
such Holder and upon all future Holders of this Security and of any Security
issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent or waiver is made upon
this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in
the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the
Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Security are payable, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly
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<PAGE>
executed by, the Holder hereof or his attorney duly authorized in writing,
and thereupon one or more new Securities of this series and of like tenor, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $ ________
[and any integral multiple thereof]. As provided in the Indenture and subject
to certain limitations therein set forth, Securities of this series are
exchangeable for a like aggregate principal amount of Securities of this
series and of like tenor of a different authorized denomination, as requested
by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
No recourse shall be had for the payment of the principal of (or
premium, if any) or the interest on this Security, or for any claim based
hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture or any indenture supplemental thereto, against any incorporator,
shareholder, officer, trustee or employee, as such, past, present or future,
of the Company or any successor entity, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise, all such liability being, by the acceptance hereof
and as part of the consideration for the issue hereof, expressly waived and
released.
Prior to due presentment of this Security for registration of
transfer, the Company, the Indenture Trustee and any agent of the Company or
the Indenture Trustee may treat the Person in whose name this Security is
registered as the owner hereof for all purposes (subject to Section 307 of
the Indenture), whether or not this Security be overdue, and neither the
Company, the Indenture Trustee nor any such agent shall be affected by notice
to the contrary.
[IF APPLICABLE, INSERT -- Interest on this Security shall be
computed on the basis of a 360-day year of twelve 30-day months.]
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
The Indenture and this Security shall be governed by and construed
in accordance with the laws of the State of New York without regard to the
conflicts of laws principles thereof.
ABBREVIATIONS
The following abbreviations, when used in the inscription of the
face of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
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<PAGE>
TEN COM - as tenants in common UNIF GIFT MIN ACT -
TEN ENT - as tenants by the entireties ______________________ Custodian
(Cust)
______________________ under
JT TEN - as joint tenants with right (Minor)
of survivorship and not as
tenants in common Uniform Gifts to
Minors Act____________________
(State)
Additional abbreviations may also be used
though not in the above list.
ASSIGNMENT FORM
(I) or (we) assign and transfer this Security to:
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint _________________________________ agent to transfer this
Security on the Register. The agent may substitute another to act for him.
Date: ___________________
Signature:_______________________________
(exactly as your name appears on
the face of this Security)
Name:____________________________________
Title:___________________________________
Address:_________________________________
Phone No.:_______________________________
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Date:____________________________________
Signature Guaranteed:
By:____________________________________
This signature shall be guaranteed by an eligible guarantor institution (a bank
or trust company having an office or correspondent in the United States or a
broker or dealer which is a member of a registered securities exchange or the
National Association of Securities Dealers, Inc.) with membership in an approved
signature guaranty medallion program pursuant to SEC Rule 17 Ad-15.
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CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF SECURITIES
This Certificate relates to $_____ principal amount of Securities
held in *________ book-entry or *_______ definitive form by ________________
(the "Transferor").
The Transferor*:
/ / has requested the Trustee by written order to deliver in exchange
for its beneficial interest in the Book-Entry Security held by the Depository a
Security or Securities in definitive, registered form of authorized
denominations in an aggregate principal amount equal to its beneficial interest
in such Book-Entry Security (or the portion thereof indicated above); or
/ / has requested the Trustee by written order to exchange or
register the transfer of a Security or Securities.
In connection with such request and in respect of each such Security,
the Transferor does hereby certify and agree that Transferor is familiar with
the Indenture relating to the above captioned Securities and as provided in
Section 305 of such Indenture, the transfer of this Security does not require
registration under the Securities Act of 1933, as amended (the "Securities Act")
because:*
/ / Such Security is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 305(b)(ii)(A) or Section
305(e)(i)(A) of the Indenture).
/ / Such Security is being transferred to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act in reliance on Rule
144A (in satisfaction of Section 305(b)(ii)(B) or Section 305(e)(i)(B) of the
Indenture) or pursuant to an exemption from registration in accordance with Rule
904 under the Securities Act (in satisfaction of Section 305(b)(ii)(B) or
Section 305(e)(i)(B) of the Indenture.)
/ / Such Security is being transferred in accordance with Rule 144
under the Securities Act, or pursuant to an effective registration statement
under the Securities Act (in satisfaction of Section 305(b)(ii)(B) or Section
305(e)(i)(B) of the Indenture).
/ / Such Security is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the
Securities Act, other than Rule 144A, 144 or Rule 904 under the Securities Act,
and any applicable state securities laws. An Opinion of Counsel to the effect
that such transfer does not require registration under the Securities Act
accompanies this Certificate (in satisfaction of Section 305(b)(ii)(C) or
Section 305(e)(i)(C) of the Indenture).
---------------------------
[INSERT NAME OF TRANSFEROR]
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<PAGE>
Dated:_______________________ By:___________________
*Check applicable box.
Section 204. ADDITIONAL PROVISIONS REQUIRED IN BOOK-ENTRY SECURITY.
Any Book-Entry Security issued hereunder shall, in addition to
the provisions contained in SECTIONS 202 and 203 and in addition to any legend
required by the Depositary, bear a legend in substantially the following form:
"This Security is a Book-Entry Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of a Depositary
or a nominee of a Depositary. This Security is exchangeable for Securities
registered in the name of a Person other than the Depositary or its nominee only
in the limited circumstances described in the Indenture and may not be
transferred except as a whole by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary."
Section 205. FORM OF INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
The Indenture Trustee's certificate of authentication shall be in
substantially the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
Dated:_______________
Bankers Trust Company,
As Indenture Trustee
By___________________________
[Authorized Signatory]
ARTICLE THREE
The Securities
Section 301. AMOUNT UNLIMITED; ISSUABLE IN SERIES.
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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. There shall be established in or pursuant to a Board Resolution and,
subject to SECTION 303, set forth, or determined in the manner provided, in an
Officers' Certificate, or established in one or more indentures supplemental
hereto, prior to the issuance of Securities of any series,
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered under this
Indenture (except for Securities authenticated and delivered upon registration
of transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to SECTIONS 304, 305, 306, 906 or 1107 and except for any
Securities which, pursuant to SECTION 303, are deemed never to have been
authenticated and delivered hereunder);
(3) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of the series shall be
issuable;
(4) the Person to whom any interest on a Security of the
series shall be payable, if other than 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 for such interest;
(5) 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;
(6) 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 the Regular Record Date for any
interest payable on any Interest Payment Date;
(7) the rights, if any, to defer payments of interest on any
Securities of the series by extending the interest payment period, and the
duration of such extensions;
(8) if other than the Corporate Trust Office of the Indenture
Trustee, the place or places where the principal of and any premium and interest
on Securities of the series shall be payable;
(9) the currency, currencies or currency units in which
payment of the principal of and any premium and interest on any Securities of
the series shall be payable if other
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<PAGE>
than the currency of the United States of America and the manner of determining
the equivalent thereof in the currency of the United States of America for
purposes of the definition of "Outstanding" in SECTION 101;
(10) the period or periods within which, the price or prices at
which, the currency or currencies (including currency units) in which and the
other terms and conditions upon which Securities of the series may be redeemed,
in whole or in part, at the option of the Company;
(11) if the principal of or any premium or interest on any
Securities of the series is to be payable, at the election of the Company or a
Holder thereof, in one or more currencies or currency units other than that or
those in which the Securities are stated to be payable, the currency, currencies
or currency units in which payment of the principal of and any premium and
interest on Securities of such series as to which such election is made shall be
payable, and the periods within which and the other terms and conditions upon
which such election is to be made;
(12) if other than the principal amount thereof, the portion of
the principal amount of Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to SECTION 502 or
the method by which such portion shall be determined;
(13) the obligation, if any, of the Company to redeem or
purchase Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or periods (or
the methods of determination of such a 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;
(14) if the amount of payments of principal of or any premium
or interest on any Securities of the series may be determined with reference to
an index, formula or other method, the index, formula or other method by which
such amounts shall be determined;
(15) if the amount Outstanding of an Indexed Security for
purposes of the definition of "Outstanding" is to be other than the principal
face amount at original issuance, the method of determination of such amount;
(16) if either or both of SECTION 1302 or 1303 does not apply
to the Securities of any series;
(17) whether the Securities of the series shall be issued in
whole or in part in the form of one or more Book-Entry Securities and, in such
case, the Depositary with respect to such Book-Entry Security or Securities and
the circumstances under which any Book-Entry Security may be registered for
transfer or exchange, or authenticated and delivered, in the name of a Person
other than such Depositary or its nominee, if other than as set forth in SECTION
305;
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(18) any additional, modified or different covenants or Events
of Default applicable to one or more particular series of Securities; and
(19) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as permitted by
SECTION 901(5)).
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to the Board Resolution referred to above and (subject to SECTION 303) set
forth, or determined in the manner provided, in the Officers' Certificate
referred to above or in any such 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.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Indenture Trustee at or prior to the delivery of the Officers'
Certificate setting forth, or providing the manner for determining, the terms of
the series.
Section 302. DENOMINATIONS.
The Securities of each series shall be issuable in registered
form without coupons in such denominations as shall be specified as contemplated
by SECTION 301. In the absence of any such provisions with respect to the
Securities of any series, the Securities of such series shall be issuable in
denominations of $1,000 and any integral multiple thereof.
Section 303. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Chief Executive Officer, its President, its Chief
Financial Officer or one of its Vice Presidents. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities 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 after the execution and
delivery of this Indenture, the Company may deliver Securities of any series
executed by the Company to the Indenture Trustee for authentication, together
with a Company Order for the authentication and delivery of such Securities, and
the Indenture Trustee in accordance with the Company Order shall authenticate
and deliver or make available for delivery such Securities; PROVIDED, HOWEVER,
that in the case of Securities of a series that are not to be originally issued
at one time, the Indenture Trustee
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shall authenticate and deliver or make available for delivery such Securities
from time to time in accordance with such other procedures (including, without
limitation, the receipt by the Indenture Trustee of oral or electronic
instructions from the Company or its duly authorized agents, promptly confirmed
in writing) acceptable to the Indenture Trustee as may be specified by or
pursuant to a Company Order delivered to the Indenture Trustee prior to the time
of the first authentication of Securities of such series. In authenticating
such Securities, and accepting the additional responsibilities under this
Indenture in relation to such Securities, the Indenture Trustee shall be
entitled to receive, and (subject to SECTION 601) shall be fully protected in
relying upon:
(i) an Opinion of Counsel stating,
(a) that the form or forms of such Securities have been
established in conformity with the provisions of this Indenture;
(b) that the terms of such Securities have been, or in the
case of Securities of a series that are not to be originally issued at one time,
will be, established in conformity with the provisions of this Indenture,
subject, in the case of Securities of a series that are not to be originally
issued at one time, to any conditions specified in such Opinion of Counsel;
(c) that such Securities, when authenticated and delivered by
the Indenture 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 conveyance, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; PROVIDED, that such Opinion
of Counsel need express no opinion as to whether a court in the United States
would render a money judgment in currency other than that of the United States;
and
(ii) an Officer's Certificate stating that all conditions precedent
provided for in this Indenture relating to the execution, authentication and
delivery of the Securities have been complied with.
If such form or forms or terms have been so established, the Indenture Trustee
shall not be required to authenticate such Securities if the issue of such
Securities pursuant to this Indenture will affect the Indenture Trustee's own
rights, duties or immunities under the Securities and this Indenture or
otherwise in a manner which the Indenture Trustee determines would expose it to
personal liability.
Notwithstanding the provisions of SECTION 301 and of the
preceding paragraph, if all Securities of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Officers'
Certificate otherwise required pursuant to SECTION 301 or the Company Order and
Opinion of Counsel otherwise required pursuant to such preceding paragraph at or
prior to the time of authentication of each Security of such series if such
documents, with appropriate modifications
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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.
If the Company shall establish pursuant to SECTION 301 that the
Securities of a series are to be issued in whole or in part in the form of one
or more Book-Entry Securities, then the Company shall execute and the Indenture
Trustee shall, in accordance with this Section and the Company Order with
respect to such series, authenticate and deliver or make available for delivery
one or more Securities in such 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 Book-Entry
Security or Securities, (ii) shall be registered in the name of the Depositary
for such Book-Entry Security or Securities or the nominee of such Depositary,
(iii) shall be delivered by the Indenture Trustee to such Depositary or pursuant
to such Depositary's instruction and (iv) shall bear the legend set forth in
SECTION 204.
Unless otherwise established pursuant to SECTION 301, each
Depositary designated pursuant to SECTION 301 for a Book-Entry Security must, at
the time of its designation and at all times while it serves as Depositary, be
a clearing agency registered under the Exchange Act and any other applicable
statute or regulation. The Indenture Trustee shall have no responsibility to
determine if the Depositary is so registered. Each Depositary shall enter into
an agreement with the Indenture Trustee governing the respective duties and
rights of such Depositary and the Indenture Trustee with regard to Book-Entry
Securities.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Security
a certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by manual signature of an authorized officer
thereof, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder. 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 Indenture Trustee
for cancellation as provided in SECTION 309, for all purposes of this Indenture
such Security shall be deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this Indenture.
Section 304. TEMPORARY SECURITIES.
Pending the preparation of Definitive Securities of any series,
the Company may execute, and upon Company Order the Indenture Trustee shall
authenticate and deliver or make available for delivery, temporary Securities
which are printed, lithographed, typewritten, mimeographed or otherwise
produced, in any authorized denomination, substantially of the tenor of the
Definitive Securities in lieu of which they are issued and with such appropriate
insertions,
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omissions, substitutions and other variations as the officers executing such
Securities may determine, as evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company
will cause Definitive Securities of that series to be prepared without
unreasonable delay. After the 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 in a Place of Payment for
that series, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Securities of any series the Company shall execute and
the Indenture Trustee shall authenticate and deliver or make available for
delivery in exchange therefor one or more Definitive Securities of the same
series, of any authorized denominations and of a like aggregate principal amount
and tenor. 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 and tenor.
Section 305. REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE; RESTRICTIONS
ON TRANSFER.
(a) General Provisions Relating to Transfers and Exchanges.
(i) The Company shall cause to be kept at the Corporate Trust
Office of the Indenture Trustee a register (the register maintained in such
office and in any other office or agency of the Company in a Place of Payment
being herein sometimes collectively referred to as the "SECURITY REGISTER") in
which, subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of Securities and of transfers of Securities.
The Indenture Trustee is hereby appointed "Security Registrar" for the purpose
of registering Securities and transfers and exchanges of Securities as herein
provided.
To permit registrations, transfers and exchanges of Securities,
the Company shall execute and the Trustee shall authenticate Definitive
Securities and Book-Entry Securities at the Security Registrar's request.
Notwithstanding anything herein to the contrary, there shall be only one
Security Register with respect to each series of Securities.
(ii) No service charge shall be made for any registration of
transfer or 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 of transfer or exchange of Securities, other
than exchanges pursuant to SECTIONS 304, 906 or 1107 not involving any transfer.
(iii) Notwithstanding any other provision in this Indenture,
unless and until it is exchanged in whole or in part for Securities that are not
in the form of a Book-Entry Security, a Book-Entry Security may not be
transferred or exchanged except as a whole by the Depositary with respect to
such Book-Entry Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary.
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(iv) All Definitive Securities and Book-Entry Securities issued
upon any registration of transfer or exchange of Definitive Securities or
Book-Entry Securities shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Definitive Securities or Book-Entry Securities surrendered
upon such registration of transfer or exchange.
(v) The Company shall not be required (i) to issue, register the
transfer of or exchange Securities of any series during a period beginning at
the opening of business 15 days before the day of the mailing of a notice of
redemption of Securities of that series selected for redemption under SECTION
1103 and ending at the close of business on the day of such mailing, or (ii)
to register the transfer of or exchange any Security so selected for
redemption in whole or in part, except the unredeemed portion of any Security
being redeemed in part.
(vi) Upon surrender for registration of transfer of any Security of
any series at the office or agency of the Company in a Place of Payment for
that series, the Company shall execute, and the Indenture Trustee shall
authenticate and deliver or make available for delivery, in the name of the
designated transferee or transferees, one or more new Securities of the same
series, of any authorized denominations and of a like aggregate principal
amount and tenor.
(vii) At the option of the Holder, Securities of any series may be
exchanged for other Securities of the same series, of any authorized
denominations and of a like aggregate principal amount and tenor, upon
surrender of the Securities to be exchanged at such office or agency.
Whenever any Securities are so surrendered for exchange, the Company shall
execute, and the Indenture Trustee shall authenticate and deliver or make
available for delivery, the Securities which the Holder making the exchange
is entitled to receive.
(viii) Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company, the Security
Registrar or the Indenture Trustee) be duly endorsed, or be accompanied by a
written instrument of transfer in form satisfactory to the Company, the
Security Registrar and the Indenture Trustee duly executed by the Holder
thereof or his attorney duly authorized in writing.
(ix) Notwithstanding the foregoing, any Book-Entry Security shall
be exchangeable pursuant to this SECTION 305 for Securities registered in the
names of Persons other than the Depositary for such Security or its nominee
only if (i) such Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for such Book-Entry Security or if at any
time such Depositary ceases to be a clearing agency registered under the
Exchange Act and the Company does not appoint a successor Depositary within
90 days after receipt by it of such notice or after it becomes aware of such
cessation, (ii) the Company executes and delivers to the Indenture Trustee a
Company Order that such Book-Entry Security shall be so exchangeable or (iii)
there shall have occurred and be continuing an Event of Default with respect
to the Securities. Any Book-Entry Security that is exchangeable pursuant to
the preceding sentence shall be exchangeable for Securities registered in
such names as such Depositary shall direct.
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(x) None of the Company, the Indenture Trustee, any Paying Agent or
the Security Registrar will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests in a Book-Entry Security or for maintaining, supervising
or reviewing any records relating to such beneficial ownership interests.
(b) Transfer and Exchange of Securities.
When Definitive Securities are presented by a Holder to the
Security Registrar with a request: (x) to register the transfer of the
Definitive Securities; or (y) to exchange such Definitive Securities for an
equal principal amount of Definitive Securities of other authorized
denominations, the Security Registrar shall register the transfer or make the
exchange as requested if its requirements for such transactions are met;
provided, however, that the Definitive Securities presented or surrendered
for register of transfer or exchange: (i) shall be duly endorsed or
accompanied by a written instruction of transfer in form satisfactory to the
Security Registrar duly executed by such Holder or by his attorney, duly
authorized in writing; and (ii) in the case of a Definitive Security that is
a Transfer Restricted Security, such request shall be accompanied by the
following additional information and documents, as applicable: (A) if such
Transfer Restricted Security is being delivered to the Security Registrar by
a Holder for registration in the name of such Holder, without transfer, a
certification to that effect from such Holder (in substantially the form of
the "Certificate to be Delivered Upon Exchange or Registration of Transfer of
Securities" set forth in SECTION 203); or (B) if such Transfer Restricted
Security is being transferred to a "qualified institutional buyer" (as
defined in Rule 144A under the Securities Act) in accordance with Rule 144A
under the Securities Act or pursuant to an exemption from registration in
accordance with Rule 144 or Rule 904 under the Securities Act or pursuant to
an effective registration statement under the Securities Act, a certification
to that effect from such Holder (in substantially the form of the
"Certificate to be Delivered Upon Exchange or Registration of Transfer of
Securities" set forth in SECTION 203) or (C) if such Transfer Restricted
Security is being transferred in reliance on another exemption from the
registration requirements of the Securities Act or the securities laws of any
other applicable jurisdiction, a certification to that effect from such
Holder (in substantially the form of the "Certificate to be Delivered Upon
Exchange or Registration of Transfer of Securities" set forth in SECTION 203)
and an Opinion of Counsel from such Holder or the transferee reasonably
acceptable to the Company and to the Security Registrar to the effect that
such transfer is in compliance with the Securities Act.
(c) Transfer of a Definitive Security for a Beneficial Interest in
a Book-Entry Security.
A Definitive Security may not be exchanged for a beneficial
interest in a Book-Entry Security except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a Definitive
Security, duly endorsed or accompanied by appropriate instruments of
transfer, in form satisfactory to the Trustee, together with: (i) if such
Definitive Security is a Transfer Restricted Security, a certification from
the Holder thereof (in substantially the form of the "Certificate to be
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Delivered Upon Exchange or Registration of Transfer of Securities" set forth
in SECTION 203) to the effect that such Definitive Security is being
transferred by such Holder to a "qualified institutional buyer" (as defined
in Rule 144A under the Securities Act) in accordance with Rule 144A under the
Securities Act; and (ii) whether or not such Definitive Security is a
Transfer Restricted Security, written instructions from the Holder thereof
directing the Trustee to make, or to direct the Security Custodian to make,
an endorsement on the Book-Entry Security to reflect an increase in the
aggregate principal amount of the Securities represented by the Book-Entry
Security, in which case the Trustee shall cancel such Definitive Security in
accordance with SECTION 309 and cause, or direct the Security Custodian to
cause, in accordance with the standing instructions and procedures existing
between the Depository and the Security Custodian, the aggregate principal
amount of Securities represented by the Book-Entry Security to be increased
accordingly. If no Book-Entry Securities are then outstanding, the Company
shall issue and, upon receipt of a Company Order in accordance with SECTION
303, the Trustee shall authenticate a new Book-Entry Security in the
appropriate principal amount.
(d) Transfer and Exchange of Book-Entry Securities.
The transfer and exchange of Book-Entry Securities or beneficial
interests therein shall be effected through the Depository, in accordance
with this Indenture and the procedures of the Depository therefor, which
shall include restrictions on transfer comparable to those set forth herein
to the extent required by the Securities Act.
(e) Transfer of a Beneficial Interest in a Book-Entry Security for
a Definitive Security.
(i) Any Person having a beneficial interest in a Book-Entry
Security may upon request exchange such beneficial interest for a Definitive
Security. Upon receipt by the Trustee of written instructions or such other
form of instructions as is customary for the Depository, from the Depository
or its nominee on behalf of any Person having a beneficial interest in a
Book-Entry Security, and, in the case of a Transfer Restricted Security, the
following additional information and documents (all of which may be submitted
by facsimile): (A) if such beneficial interest is being transferred to the
Person designated by the Depository as being the beneficial owner, a
certification to that effect from such Person (in substantially the form of
the "Certificate to be Delivered Upon Exchange or Registration of Transfer of
Securities" set forth in SECTION 203) or (B) if such beneficial interest is
being transferred to a "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) in accordance with Rule 144A under the
Securities Act or pursuant to an exemption from registration in accordance
with Rule 144 or Rule 904 under the Securities Act or pursuant to an
effective registration statement under the Securities Act, a certification to
that effect from the transferor (in substantially the form of "Certificate to
be Delivered Upon Exchange or Registration of Transfer of Securities" set
forth in SECTION 203) or (C) if such beneficial interest is being transferred
in reliance on another exemption from the registration requirements of the
Securities Act or the securities laws of any other applicable jurisdiction, a
certification to that effect from the transferor (in substantially the form
of the "Certificate to be Delivered Upon Exchange or
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Registration of Transfer of Securities" set forth in SECTION 203) and an
Opinion of Counsel from the transferee or transferor reasonably acceptable to
the Company and to the Security Registrar to the effect that such transfer is
in compliance with the Securities Act, in which case the Trustee or the
Security Custodian, at the direction of the Trustee, shall, in accordance
with the standing instructions and procedures existing between the Depository
and the Security Custodian, cause the aggregate principal amount of
Book-Entry Securities to be reduced accordingly and, following such
reduction, the Company shall execute and, upon receipt of a Company Order in
accordance with SECTION 303, the Trustee shall authenticate and deliver to
the transferee a Definitive Security in the appropriate principal amount.
(ii) Definitive Securities issued in exchange for a beneficial
interest in a Book-Entry Security pursuant to this SECTION 305(e) shall be
registered in such names and in such authorized denominations as the
Depository, pursuant to instructions from its direct or indirect participants
or otherwise, shall instruct the Trustee. The Trustee shall deliver such
Definitive Securities to the Persons in whose names such Securities are so
registered.
(f) Restrictions on Transfer and Exchange of Book-Entry Securities.
Notwithstanding any other provision of this Indenture (other than
the provisions set forth in subsection (g) of this SECTION 305), a Book-Entry
Security may not be transferred as a whole except 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.
(g) Authentication of Securities in Absence of Depository.
If at any time: (i) the Depository for the Securities notifies the
Company that the Depository is unwilling or unable to continue as Depository
for the Book-Entry Securities and a successor Depository for the Book-Entry
Securities is not appointed by the Company within 90 days after delivery of
such notice; or (ii) the Company, at its sole discretion, notifies the
Trustee in writing that it elects to cause the issuance of Definitive
Securities under this Indenture, then the Company shall execute, and the
Trustee shall, upon receipt of a Company Order in accordance with SECTION
303, authenticate and deliver, Definitive Securities in an aggregate
principal amount equal to the principal amount of the Book-Entry Securities
in exchange for such Book-Entry Securities.
(h) Legends and Authentication of Securities under Specified
Circumstances.
(i) Except as permitted by the following paragraphs (iii) and (iv),
each Security certificate evidencing Book-Entry Securities and Definitive
Securities (and all Securities issued in exchange therefor or substitution
thereof) issued other than pursuant to Regulation S shall bear a legend in
substantially the following form:
"THIS [NOTE] [DEBENTURE] HAS NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
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AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1)
TO A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A") IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (2) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH
TRANSFER, FURNISHES TO THE TRUSTEE FOR THIS [NOTE] [DEBENTURE] A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH
LETTER CAN BE OBTAINED FROM THE TRUSTEE), (3) IN AN OFFSHORE TRANSACTION
MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE
SECURITIES ACT OR (4) PURSUANT TO AN EXEMPTION FROM THE REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) AND (B) IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES."
(ii) Except as permitted by the following paragraphs (iii) and
(iv), each Security certificate evidencing Book-Entry Securities and
Definitive Securities (and all Securities issued in exchange therefor or
substitution thereof) issued pursuant to Regulation S shall bear a legend in
substantially the following form:
"THIS [NOTE] [DEBENTURE] HAS NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, PRIOR
TO THE EXPIRATION OF A DISTRIBUTION COMPLIANCE PERIOD (DEFINED AS 40 DAYS
AFTER THE ISSUE DATE WITH RESPECT TO THE [NOTES] [DEBENTURES]), MAY NOT BE:
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S OR
(2) TO A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER
THE SECURITIES ACT ("RULE 144A") IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, OR (3) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH
TRANSFER, FURNISHES TO THE TRUSTEE FOR THIS [NOTE] [DEBENTURE] A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH
LETTER CAN BE OBTAINED FROM THE TRUSTEE), AND (B) IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES."
(iii) Upon any sale or transfer of a Transfer Restricted Security
(including any Transfer Restricted Security represented by a Book-Entry
Security) pursuant to Rule 144 under the Securities Act or pursuant to an
effective registration statement under the Securities Act: (A) in the case of
any Transfer Restricted Security that is a Definitive Security, the Security
Registrar shall permit the Holder thereof to exchange such Transfer
Restricted Security for a Definitive Security that does not bear the legend
set forth in (i) OR (ii) above and rescind any restriction on the transfer of
such Transfer Restricted Security; and (B) in the case of any Transfer
Restricted Security
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represented by a Book-Entry Security, such Transfer Restricted Security shall
not be required to bear the legend set forth in (i) or (ii) above, but shall
continue to be subject to the provisions of Section 305(e); PROVIDED,
HOWEVER, that with respect to any request for an exchange of a Transfer
Restricted Security that is represented by a Book-Entry Security for a
Definitive Security that does not bear the legend set forth in (i) or (ii)
above, which request is made in reliance upon Rule 144, the Holder thereof
shall certify in writing to the Security Registrar that such request is being
made pursuant to Rule 144 (such certification to be substantially in the form
of the "Certificate to be Delivered Upon Exchange or Registration of Transfer
of Securities" set forth in SECTION 203).
(iv) Notwithstanding the foregoing, upon consummation of the
Exchange Offer, the Company shall issue and, upon receipt of a Company Order
in accordance with SECTION 303, the Trustee shall authenticate Exchange
Securities in exchange for Offered Securities accepted for exchange in the
Exchange Offer, which Exchange Securities shall not bear the legend set forth
in (i) or (ii) above, and the Security Registrar shall rescind any
restriction on the transfer of such Securities, in each case unless the
Holder of such Offered Securities is either (A) a broker-dealer, (B) a Person
participating in the distribution of the Offered Securities or (C) a Person
who is an affiliate (as defined in Rule 144A) of the Company.
(v) The letter required to be provided pursuant to paragraphs (i)
and (ii) above shall be substantially in the form of EXHIBIT 305(h)(v) hereto.
(i) Cancellation and/or Adjustment of Book-Entry Securities.
At such time as all beneficial interests in Book-Entry Securities
have been exchanged for Definitive Securities, redeemed, repurchased or
canceled, all Book-Entry Securities shall be returned to or retained and
canceled by the Trustee in accordance with SECTION 309. At any time prior to
such cancellation, if any beneficial interest in a Book-Entry Security is
exchanged for Definitive Securities, redeemed, repurchased or canceled, the
Trustee or the Security Custodian, at the direction of the Trustee, shall, in
accordance with the standing instructions and procedures existing between the
Depository and the Security Custodian, cause the aggregate amount of
Book-Entry Securities to be reduced accordingly.
Section 306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.
If any mutilated Security is surrendered to the Indenture Trustee,
the Company shall execute and the Indenture Trustee shall authenticate and
deliver or make available for delivery in exchange therefor a new Security of
the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
If there shall be delivered to the Company and the Indenture
Trustee (i) evidence to their satisfaction of the destruction, loss or theft
of any Security 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 Indenture Trustee that such
Security has been acquired
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by a bona fide purchaser, the Company shall execute and the Indenture Trustee
shall authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the 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 Indenture Trustee) connected
therewith.
Every new Security of any series issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Security 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 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.
Section 307. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Except as otherwise provided as contemplated by SECTION 301 with
respect to any series of Securities, interest on any 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 for such interest at the office or agency maintained for such
purpose pursuant to SECTION 1002; PROVIDED, HOWEVER, that at the option of
the Company, interest on Securities of any series that bear interest may be
paid (i) by check mailed to the address of the Person entitled thereto as it
shall appear on the Security Register or (ii) by wire transfer to an account
maintained by the Person entitled thereto as specified in the Security
Register; PROVIDED, that such Person shall have given the Indenture Trustee
written wire instructions at least five Business Days prior to the applicable
Interest Payment Date.
Any interest on any Security of any series which is payable, but is
not punctually paid or duly provided for, on any Interest Payment Date
(herein called "DEFAULTED INTEREST") shall forthwith cease to be payable to
the Holder on the relevant Regular Record Date by virtue of having been such
Holder, and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in Clauses (1) or (2) below:
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(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such series (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 notify the
Indenture Trustee in writing of the amount of Defaulted Interest proposed to
be paid on each Security of such series and the date of the proposed payment,
and at the same time the Company shall deposit with the Indenture 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
Indenture Trustee for such deposit prior to the date of the proposed payment,
such money when deposited to be in immediately available funds and held in
trust for the benefit of the Persons entitled to such Defaulted Interest as
in this Clause provided. Thereupon the Indenture 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 Indenture Trustee
of the notice of the proposed payment (it being understood that the date of
the proposed payment shall be delayed, as necessary, by that numbers of days
that are required to allow for the minimum number of days (i.e., 10 days)
between the Special Record Date and the date of payment, and that the Trustee
will provide the Company with prompt written notice of any such required
delay after the Trustee's receipt of the Company's notice of the proposed
payment). The Indenture 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 mailed, first-class postage prepaid, to
each Holder of Securities of such series at his address as it appears in the
Security 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 the Securities of such series (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).
(2) The Company may make payment of any Defaulted Interest on
the Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Indenture Trustee of the proposed payment
pursuant to this Clause, such manner of payment shall be deemed practicable
by the Indenture Trustee.
In the case of any Security which is converted after any Regular
Record Date and on or prior to the next succeeding Interest Payment Date
(other than any Security whose Maturity is prior to such Interest Payment
Date), interest whose Stated Maturity is on such Interest Payment Date shall
be payable on such Interest Payment Date notwithstanding such conversion, and
such interest (whether or not punctually paid or duly provided for) 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 such Regular Record
Date. Except as otherwise expressly provided in the immediately preceding
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sentence, in the case of any Security which is converted, interest whose
Stated Maturity is after the date of conversion of such Security shall not be
payable.
Subject to the foregoing provisions of this Section, 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 308. PERSONS DEEMED OWNERS.
Prior to due presentment of a Security for registration of
transfer, the Company, the Indenture Trustee and any agent of the Company or
the Indenture Trustee may treat the Person in whose name such Security is
registered as the owner of such Security for the purpose of receiving payment
of principal of and any premium and (subject to SECTION 307) any interest on
such Security and for all other purposes whatsoever, whether or not such
Security be overdue, and neither the Company, the Indenture Trustee nor any
agent of the Company or the Indenture Trustee shall be affected by notice to
the contrary.
None of the Company, the Indenture Trustee, any Paying Agent or the
Security Registrar will have any responsibility or liability for any aspect
of the records relating to or payments made on account of beneficial
ownership interests of any Book-Entry Security or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
Section 309. CANCELLATION.
All Securities surrendered for payment, redemption, conversion,
repurchase, registration of transfer or exchange or for credit against any
sinking fund payment shall, if surrendered to any Person other than the
Indenture Trustee, be delivered to the Indenture Trustee. All Securities so
delivered and any Securities surrendered directly to the Indenture Trustee
for any such purpose shall be promptly canceled by the Indenture Trustee and
such cancellation shall be noted conspicuously on each such Security. The
Company may at any time deliver to the Indenture Trustee for cancellation any
Securities previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and may deliver to the Indenture
Trustee (or to any other Person for delivery to the Indenture Trustee) for
cancellation any Securities previously authenticated hereunder which the
Company has not issued and sold, and all Securities so delivered shall be
promptly canceled by the Indenture Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities canceled as
provided in this Section, except as expressly permitted by this Indenture.
All canceled Securities held by the Indenture Trustee shall be disposed of as
directed by a Company Order or after 90 days, if not in receipt of such
Company Order, shall be disposed of in accordance with the Indenture
Trustee's customary procedures.
Section 310. COMPUTATION OF INTEREST.
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Except as otherwise specified as contemplated by SECTION 301 for
Securities of any series, (i) interest on the Securities of each series which
bear interest at a fixed rate shall be computed on the basis of a 360-day
year of twelve 30-day months and (ii) interest on the Securities of each
series which bear interest at a variable rate shall be computed on a basis of
the actual number of days in an interest period divided by 360.
Section 311. CUSIP NUMBERS.
The Company in issuing the Securities may use "CUSIP" numbers (if
then generally in use), and, if so, the Indenture 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 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 CUSIP
numbers. The Company will promptly notify the Indenture Trustee in writing
of any change in the CUSIP numbers.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. SATISFACTION AND DISCHARGE OF INDENTURE.
This Indenture shall upon Company Request cease to be of further
effect with respect to Securities of any series (except as to any surviving
rights of registration of transfer, substitution, exchange, replacement and
conversion of such Securities herein expressly provided for), and the
Indenture Trustee, at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture with
respect to such Securities, when
(1) either
(A) all such Securities theretofore authenticated and
delivered (other than (i) such Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided in SECTION 306 and
(ii) such Securities 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 1003)
have been delivered to the Indenture Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the
Indenture 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) are to be called for redemption within one year under arrangements
satisfactory to the Indenture Trustee for the giving of notice of redemption
by the
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Indenture Trustee in the name, and at the expense, of the Company, and the
Company, in the case of (B)(i), (ii) or (iii) above, has deposited or caused
to be deposited with the Indenture Trustee as trust funds in trust for the
purpose of payment and discharge an amount in the currency or currencies or
currency unit or units in which such Securities are payable sufficient to pay
and discharge the entire indebtedness on such Securities not theretofore
delivered to the Indenture Trustee for cancellation, for principal and any
premium and interest 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 has delivered to the Indenture Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction and
discharge of this Indenture with respect to such Securities have been
complied with.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Indenture Trustee under
SECTION 607 and to any Authenticating Agent under SECTION 615 and, if money
shall have been deposited with the Indenture Trustee pursuant to subclause
(B) of Clause (1) of this Section, the obligations of the Indenture Trustee
under SECTION 402, ARTICLE SIX and the last paragraph of SECTION 1003 shall
survive.
Section 402. APPLICATION OF TRUST MONEY.
Subject to provisions of the last paragraph of SECTION 1003,
all money deposited with the Indenture Trustee pursuant to SECTION 401 shall
be held in trust and applied by it, in accordance with the provisions of the
Securities and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Indenture Trustee may determine, to the Persons entitled thereto, of the
principal and any premium and interest for whose payment such money has been
deposited with the Indenture Trustee.
ARTICLE FIVE
Events of Default and Remedies
Section 501. EVENTS OF DEFAULT.
"EVENT OF DEFAULT", wherever used herein with respect to
Securities of any series, means any one of the following events (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 judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental
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body, unless it is inapplicable to a particular series or is specifically
deleted or modified in the Board Resolution (or action taken pursuant
thereto), Officers' Certificate or supplemental indenture under which such
series of Securities is issued or has been modified in an indenture
supplemental hereto):
(1) default in the payment of any interest upon any Security
of that series when it becomes due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of (or premium,
if any, on) any Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when
and as due by the terms of a Security of that series, and continuance of such
default for a period of 30 days; or
(4) default in the performance, or breach, of any covenant
or warranty of the Company in this Indenture with respect to Securities of
that series (other than a covenant or warranty a default in whose performance
or whose breach is elsewhere in this Section specifically dealt with), and
continuance of such default or breach for a period of 60 days after there has
been given, by registered or certified mail, to the Company by the Indenture
Trustee or to the Company and the Indenture Trustee by the Holders of at
least 25% in principal amount of the Outstanding Securities of that series
(or, if any of the Securities of that series are Original Issue Discount
Securities or Indexed Securities, such portion of the principal amount of
such Securities as may be specified in the terms thereof) 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; or
(5) the entry by a court having jurisdiction in the premises
of (A) a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable federal or state
bankruptcy, insolvency, reorganization or other similar law or (B) a decree
or order adjudging the Company a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under any applicable federal or
state law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of any
substantial part of its property, or ordering the winding up or liquidation
of its affairs, and the continuance of any such decree or order for relief or
any such other decree or order unstayed and in effect for a period of 90
consecutive days; or
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(6) the commencement by the Company of a voluntary case or
proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to be
adjudicated a bankrupt or insolvent, or the consent by it to the entry of a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any bankruptcy
or insolvency case or proceeding against it, or the filing by it of a
petition or answer or consent seeking reorganization or relief under any
applicable federal or state law, or the consent by it to the filing of such
petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or the
making by it of an assignment for the benefit of creditors, or the admission
by it in writing of its inability to pay its debts generally as they become
due, or the taking of corporate action by the Company in furtherance of any
such action; or
(7) any other Event of Default provided with respect to
Securities of that series.
Section 502. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.
If an Event of Default (other than an Event of Default
described in clause 5 or 6 of SECTION 501) with respect to Securities of any
series at the time Outstanding occurs and is continuing, then in every such
case the Indenture Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities of that series may declare the principal
amount (or, if any of the Securities of that series are Original Issue
Discount Securities or Indexed Securities, such portion of the principal
amount of such Securities as may be specified in the terms thereof) of all of
the Securities of that series to be due and payable immediately, by a notice
in writing to the Company (and to the Indenture Trustee if given by Holders),
and upon any such declaration such principal amount (or, in the case of
Original Issue Discount Securities or Indexed Securities, such specified
amount) shall become 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 judgment or
decree for payment of the money due has been obtained by the Indenture
Trustee as hereinafter in this Article provided, the Holders of a majority in
principal amount of the Outstanding Securities of that series (or, if any of
the Securities of that series are Original Issue Discount Securities or
Indexed Securities, such portion of the principal amount of such Securities
as may be specified in the terms thereof), by written notice to the Company
and the Indenture Trustee, may rescind and annul such declaration and its
consequences if
(1) the Company has paid or deposited with the Indenture
Trustee a sum sufficient to pay (A) all overdue interest on all Securities of
that series, (B) 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 (D) all sums paid or advanced by the
Indenture Trustee hereunder and the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee, its agents and counsel;
and
(2) all 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 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
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If an Event of Default described in clause 5 or 6 of SECTION
501 occurs, the Outstanding Securities shall ipso facto become immediately
due and payable without need of any declaration or other act on the part of
the Indenture Trustee or any Holder.
Section 503. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY INDENTURE
TRUSTEE.
The Company covenants that if
(1) default is made in the payment of any interest on any
Security when such interest 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,
the Company will, upon demand of the Indenture Trustee, pay to it, for the
benefit of the Holders of such Securities, the whole amount then due and
payable on such Securities for principal and any premium and interest and, to
the extent that payment of such interest shall be legally enforceable,
interest on any overdue principal and premium and on any overdue interest, at
the rate or rates prescribed therefor in such Securities, 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 Indenture Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series
occurs and is continuing, the Indenture 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 Indenture
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
enforce any other proper remedy.
Section 504. INDENTURE TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of any judicial proceeding relative to the Company (or
any other obligor upon the Securities), its property or its creditors, the
Indenture Trustee shall be entitled and empowered, by intervention in such
proceeding or otherwise, to take any and all actions authorized under the
Trust Indenture Act in order to have claims of the Holders and the Indenture
Trustee allowed in any such proceeding. In particular, the Indenture 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 directly to the Indenture Trustee and, in the
event that the Indenture Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Indenture Trustee any amount due it
for the reasonable compensation, expenses, disbursements and advances of the
Indenture Trustee, its agents and counsel, and any other amounts due the
Indenture Trustee under SECTION 607.
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No provision of this Indenture shall be deemed to authorize the
Indenture Trustee to authorize or consent to or accept or adopt on behalf of
any Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize
the Indenture Trustee to vote in respect of the claim of any Holder in any
such proceeding; PROVIDED, HOWEVER, that the Indenture Trustee may, on behalf
of the Holders, vote for the election of a trustee in bankruptcy or similar
official and may be a member of a creditors' or other similar committee.
Section 505. INDENTURE 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 Indenture Trustee without
the possession of any of the Securities or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the
Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment shall, after provision for the payment of
the reasonable compensation, expenses, disbursements and advances of the
Indenture Trustee, its agents and counsel, be for the ratable benefit of the
Holders of the Securities in respect of which such judgment has been
recovered.
Section 506. APPLICATION OF MONEY COLLECTED.
Any money collected by the Indenture Trustee pursuant to this
Article shall be applied in the following order, at the date or dates fixed
by the Indenture Trustee and, in case of the distribution of such money on
account of principal or any premium or interest, upon presentation of the
Securities and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Indenture Trustee
under SECTION 607;
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due and
payable on such Securities for principal and any premium and interest,
respectively; and
THIRD: The balance, if any, to the Person or Persons entitled
thereto.
The Indenture Trustee may fix a record date and payment date
for any payment to holders of Securities pursuant to this SECTION 506. At
least 15 days before such record date, the Company shall mail to each holder
of Securities and the Indenture Trustee a notice that states the record date,
the payment date and amount to be paid.
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Section 507. LIMITATION ON SUITS.
No Holder of any Security of any series 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) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default with respect to the
Securities of that series;
(2) the Holders of not less than 25% in principal amount of
the Outstanding Securities of that series shall have made written request to
the Indenture Trustee to institute proceedings in respect of such Event of
Default in its own name as Indenture Trustee hereunder;
(3) such Holder or Holders have offered to the Indenture
Trustee indemnity satisfactory to it against the costs, expenses and
liabilities to be incurred in compliance with such request;
(4) the Indenture Trustee for 60 days after its receipt of
such notice, request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Indenture Trustee before or during such 60-day period by
the Holders of a majority in principal amount of the Outstanding Securities
of that series;
it being understood and intended that no one or more of such 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 Holders, or to obtain or to seek to obtain priority or preference over
any other Holders or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all Holders.
Section 508. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM AND
INTEREST.
Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of and any premium and
(subject to SECTION 307) any interest on such Security on the Stated Maturity
or Maturities expressed in such Security (or, in the case of redemption, on
the Redemption Date) and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.
Section 509. RESTORATION OF RIGHTS AND REMEDIES.
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If the Indenture Trustee or any Holder 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 Indenture Trustee or to such Holder, then and in
every such case, subject to any determination in such proceeding, the
Company, the Indenture Trustee and the Holders shall be restored severally
and respectively to their former positions hereunder and thereafter all
rights and remedies of the Indenture Trustee and the Holders shall continue
as though no such proceeding had been instituted.
Section 510. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of SECTION 306 and as otherwise provided in SECTION 507, no right
or remedy herein conferred upon or reserved to the Indenture Trustee or to
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 right or remedy hereunder, or otherwise, shall not prevent
the concurrent assertion or employment of any other appropriate right or
remedy.
Section 511. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Indenture Trustee or of any Holder
of any Securities to exercise any right or remedy accruing upon any Event of
Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy
given by this Article or by law to the Indenture Trustee or to the Holders
may be exercised from time to time, and as often as may be deemed expedient,
by the Indenture Trustee or by the Holders, as the case may be.
Section 5012. CONTROL BY HOLDERS.
The Holders of a majority in principal amount of the
Outstanding Securities of any series shall have the right, after notice and
request made to the Indenture Trustee pursuant to SECTION 105 hereof, to
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, with respect to the Securities of such
series; PROVIDED, that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture,
(2) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee which is not inconsistent with such direction,
and
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(3) subject to the provisions of SECTION 601, the Indenture
Trustee shall have the right to decline to follow any such direction if the
Indenture Trustee in good faith shall, by a Responsible Officer or Officers
of the Indenture Trustee, determine that the proceeding so directed would
involve the Indenture Trustee in personal liability.
Section 513. WAIVER OF PAST DEFAULTS.
The Holders of not less than a majority in principal amount of
the Outstanding Securities of any series may on behalf of the Holders of all
the Securities of such series waive any past default hereunder with respect
to such series and its consequences, except a default
(1) in the payment of the principal of or any premium or
interest on any Security of such series, or
(2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended 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; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
Section 514. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Indenture Trustee for any action
taken, suffered or omitted by it as Indenture Trustee, a court may require
any party litigant in such suit to file an undertaking to pay the costs of
such suit, and may assess costs, including counsel fees and expenses, against
any such party litigant, in the manner and to the extent provided in the
Trust Indenture Act; 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, the Indenture Trustee, a Holder of Securities pursuant to SECTION 508,
or the Holders of more than 10% in aggregate principal amount of the
Outstanding Securities of any series.
ARTICLE SIX
The Indenture Trustee
Section 601. CERTAIN DUTIES AND RESPONSIBILITIES.
The duties and responsibilities of the Indenture Trustee shall
be as provided by the Trust Indenture Act. Notwithstanding the foregoing, no
provision of this Indenture shall require the Indenture Trustee to expend or
risk its own funds or otherwise incur any financial liability in the
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performance of any of its duties hereunder, or in the exercise of any 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.
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 Indenture Trustee shall be subject to the
provisions of this Section.
Section 602. NOTICE OF DEFAULTS.
If a default occurs hereunder with respect to Securities of any
series, the Indenture Trustee shall, to the extent a Responsible Officer of
the Indenture Trustee has actual knowledge of such default, within 90 days
after such default becomes known to the Trustee, give the Holders of
Securities of such series notice of such default as and to the extent
provided by the Trust Indenture Act; PROVIDED, HOWEVER, that in the case of
any default of the character specified in SECTION 501(4) with respect to
Securities of such series, no such notice to Holders shall be given until at
least 30 days after the occurrence thereof. For the purpose of this Section,
the term "default" means any event which is, or after notice or lapse of time
or both would become, an Event of Default with respect to Securities of such
series.
Section 603. CERTAIN RIGHTS OF INDENTURE TRUSTEE.
Subject to the provisions of SECTION 601:
(a) the Indenture Trustee may conclusively rely and shall
fully be protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document (whether in its original or facsimile
form) believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Trustees may be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this Indenture the
Indenture Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action hereunder, the
Indenture Trustee (unless other evidence be herein specifically prescribed)
may, in the absence of bad faith on its part, conclusively rely upon an
Officers' Certificate or an Opinion of Counsel;
(d) the Indenture Trustee may consult with counsel of its
selection and the written advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and
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protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(e) the Indenture 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 Indenture Trustee security or
indemnity satisfactory to it against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or direction;
(f) the Indenture 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 Indenture Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Indenture 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;
(g) the Indenture Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents, attorneys, custodians or nominees and the Indenture Trustee
shall not be responsible for any misconduct or negligence on the part of any
agent, attorney, custodian or nominee appointed with due care by it hereunder;
(h) the duties of the Indenture Trustee shall be determined
solely by the express provisions of this Indenture and the Trust Indenture
Act, and the Indenture Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, and no implied
covenants or obligations shall be read into this Indenture against the
Indenture Trustee;
(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 Indenture Trustee is subject to
the provisions of this SECTION 603;
(j) the Indenture Trustee shall not be liable for interest on
any money received by it hereunder except as the Indenture Trustee may agree
in writing with the Company. Money held in trust by the Indenture Trustee
hereunder need not be segregated from other funds except to the extent
required by law; and
(k) the Indenture Trustee shall not be liable for any action
taken, suffered or omitted by it in good faith and reasonably believed by it
to be authorized or within the discretion or rights or powers conferred upon
it by this Indenture.
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Section 604. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Securities, except the
Indenture Trustee's certificates of authentication, shall be taken as the
statements of the Company, and neither the Indenture Trustee nor any
Authenticating Agent assumes any responsibility for their correctness. The
Indenture Trustee makes no representations as to the validity or sufficiency
of this Indenture or of the Securities. Neither the Indenture Trustee nor
any Authenticating Agent shall be accountable for the use or application by
the Company of Securities or the proceeds thereof.
Section 605. MAY HOLD SECURITIES AND SERVE AS INDENTURE TRUSTEE UNDER OTHER
INDENTURES.
The Indenture Trustee, any Authenticating Agent, any Paying Agent,
any Security Registrar or any other agent of the Company, in its individual
or any other capacity, may become the owner or pledgee of Securities and,
subject to SECTIONS 608 and 613, may otherwise deal with the Company with the
same rights it would have if it were not Indenture Trustee, Authenticating
Agent, Paying Agent, Security Registrar or such other agent.
Subject to the provisions of SECTION 608, the Indenture Trustee may
become and act as indenture trustee under other indentures under which other
securities, or certificates of interest or participation in other securities,
of the Company are outstanding in the same manner as if it were not Indenture
Trustee.
Section 606. MONEY HELD IN TRUST.
Money held by the Indenture Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The
Indenture Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the
Company.
Section 607. COMPENSATION AND REIMBURSEMENT.
The Company agrees
(1) to pay to the Indenture Trustee from time to time such
reasonable compensation as shall be agreed in writing between the Company and
the Indenture Trustee for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse
the Indenture Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Indenture Trustee in
accordance with any provision of this Indenture (including the reasonable
compensation and the expenses and disbursements of its agents and counsel),
except any such
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expense, disbursement or advance as may be attributable to its negligence,
willful misconduct or bad faith; and
(3) to indemnify each of the Indenture Trustee, its officers,
directors, employees and agents or any predecessor Indenture Trustee, for,
and to hold it harmless against, any and all loss, liability, damage, claim
or expense incurred without negligence or willful misconduct on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the 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 hereunder.
The Indenture Trustee shall have a lien prior to the Securities
upon all property and funds held by it hereunder for any amount owing it or
any predecessor Indenture Trustee pursuant to this SECTION 607, except with
respect to funds held in trust for the benefit of the Holders of particular
Securities.
Without limiting any rights available to the Indenture Trustee
under applicable law, when the Indenture Trustee incurs expenses or renders
services in connection with an Event of Default specified in SECTION 501(5)
or 501(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 satisfaction and
discharge of this Indenture and the resignation or removal of the Indenture
Trustee.
Section 608. DISQUALIFICATION; CONFLICTING INTERESTS.
If the Indenture Trustee has or shall acquire a conflicting
interest within the meaning of the Trust Indenture Act, the Indenture Trustee
shall either eliminate such interest or resign, to the extent and in the
manner provided by, and subject to the provisions of, the Trust Indenture Act
and this Indenture. To the extent permitted by the Trust Indenture Act, the
Indenture Trustee shall not be deemed to have a conflicting interest by
virtue of being a trustee under this Indenture with respect to Securities of
more than one series.
Section 609. CORPORATE INDENTURE TRUSTEE REQUIRED; ELIGIBILITY.
There shall at all times be a Indenture Trustee hereunder which
shall be a Person that is eligible pursuant to the Trust Indenture Act to act
as such and has a combined capital and surplus of at least $50,000,000. If
such Person publishes reports of condition at least annually, pursuant to law
or to the requirements of any federal or state supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Person 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 Indenture Trustee shall cease to be eligible in accordance with the
provisions of this
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Section, it shall resign immediately in the manner and
with the effect hereinafter specified in this Article.
Section 610. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Indenture Trustee and no
appointment of a successor Indenture Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the successor
Indenture Trustee in accordance with the applicable requirements of SECTION
611.
(b) The Indenture Trustee may resign at any time with respect to
the Securities of one or more series by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Indenture Trustee
required by SECTION 611 shall not have been delivered to the Indenture
Trustee within 30 days after the giving of such notice of resignation, the
resigning Indenture Trustee may petition, at the expense of the Company, any
court of competent jurisdiction for the appointment of a successor Indenture
Trustee with respect to the Securities of such series.
(c) The Indenture Trustee may be removed at any time with
respect to the Securities of any series by Act of the Holders of a majority
in principal amount of the Outstanding Securities of such series, delivered
to the Indenture Trustee and to the Company. If the instrument of acceptance
by a successor Indenture Trustee required by SECTION 611 shall not have been
delivered to the Indenture Trustee within 30 days after the giving of such
notice of removal, the Indenture Trustee being removed may petition, at the
expense of the Company, any court of competent jurisdiction for the
appointment of a successor Indenture Trustee with respect to the Securities
of such series.
(d) If at any time:
(1) the Indenture Trustee shall fail to comply with SECTION
608 after written request therefor by the Company or by any Holder who has
been a bona fide Holder of a Security for at least six months, or
(2) the Indenture Trustee shall cease to be eligible under
SECTION 609 and shall fail to resign after written request therefor by the
Company or by any such Holder, or
(3) the Indenture Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver of the Indenture
Trustee or of its property shall be appointed or any public officer shall
take charge or control of the Indenture Trustee or of 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 Indenture Trustee and appoint a successor Indenture Trustee
with respect to all Securities, or (ii) subject to SECTION 514, any Holder
who has been a bona fide Holder of a Security for at least six
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months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the removal of the Indenture Trustee
with respect to all Securities and the appointment of a successor Indenture
Trustee or Indenture Trustees.
(e) If the Indenture Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Indenture
Trustee 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 Indenture Trustee or Indenture Trustees with respect to the
Securities of that or those series (it being understood that any such
successor Indenture 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 Indenture Trustee with respect to the Securities of any particular
series) and shall comply with the applicable requirements of SECTION 611.
If, within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Indenture 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 Indenture Trustee, the successor
Indenture Trustee so appointed shall, forthwith upon its acceptance of such
appointment in accordance with the applicable requirements of SECTION 611,
become the successor Indenture Trustee with respect to the Securities of such
series and to that extent supersede the successor Indenture Trustee appointed
by the Company. If no successor Indenture Trustee with respect to the
Securities of any series shall have been so appointed by the Company or the
Holders and accepted appointment in the manner required by SECTION 611, 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 Indenture Trustee with respect to the Securities of such series.
(f) The Company shall give notice of each resignation and each
removal of the Indenture Trustee with respect to the Securities of any series
and each appointment of a successor Indenture Trustee with respect to the
Securities of any series to all Holders of Securities of such series in the
manner provided in SECTION 106. Each notice shall include the name of the
successor Indenture Trustee with respect to the Securities of such series and
the address of its Corporate Trust Office.
Section 611. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor
Indenture Trustee with respect to all Securities, every such successor
Indenture Trustee so appointed shall execute, acknowledge and deliver to the
Company and to the retiring Indenture Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring
Indenture Trustee shall become effective and such successor Indenture
Trustee, without any further act, deed or conveyance, shall become vested
with all the rights, powers, trusts and duties of the retiring Indenture
Trustee; but, on the request of the Company or the successor Indenture
Trustee, such retiring Indenture Trustee shall, upon payment of all sums due
and owing to the Indenture Trustee under SECTION 607, execute and deliver an
instrument transferring to such successor Indenture
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Trustee all the rights, powers and trusts of the retiring Indenture Trustee
and shall duly assign, transfer and deliver to such successor Indenture
Trustee all property and money held by such retiring Indenture Trustee
hereunder.
(b) In case of the appointment hereunder of a successor
Indenture Trustee with respect to the Securities of one or more (but not all)
series, the Company, the retiring Indenture Trustee and each successor
Indenture Trustee with respect to the Securities of one or more series shall
execute and deliver an indenture supplemental hereto wherein each successor
Indenture Trustee shall accept such appointment and which (1) shall contain
such provisions as shall be necessary or desirable to transfer and confirm
to, and to vest in, each successor Indenture Trustee all the rights, powers,
trusts and duties of the retiring Indenture Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Indenture Trustee relates, (2) if the retiring Indenture 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 of the retiring Indenture Trustee with respect to
the Securities of that or those series as to which the retiring Indenture
Trustee is not retiring shall continue to be vested in the retiring Indenture
Trustee, and (3) 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 Indenture Trustee, it
being understood that nothing herein or in such supplemental indenture shall
constitute such Indenture Trustees co-trustees of the same trust and that
each such Indenture Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder administered by any
other such Indenture Trustee; and upon the execution and delivery of such
supplemental indenture the resignation or removal of the retiring Indenture
Trustee shall become effective to the extent provided therein and each such
successor Indenture Trustee, without any further act, deed or conveyance,
shall become vested with all the rights, powers, trusts and duties of the
retiring Indenture Trustee with respect to the Securities of that or those
series to which the appointment of such successor Indenture Trustee relates;
but, on request of the Company or any successor Indenture Trustee, such
retiring Indenture Trustee shall duly assign, transfer and deliver to such
successor Indenture Trustee all property and money held by such retiring
Indenture Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Indenture Trustee relates;
PROVIDED, HOWEVER, that to the extent that such property and money is not
held by the Indenture Trustee in trust for the benefit of the Holders of
particular Securities, such retiring Indenture Trustee shall transfer and
deliver to such successor Indenture Trustee such property and money upon
payment of all sums due and owing to such retiring Indenture Trustee under
SECTION 607.
(c) Upon request of any such successor Indenture Trustee, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Indenture Trustee all such
rights, powers and trusts referred to in paragraph (a) and (b) of this
Section, as the case may be.
(d) No successor Indenture Trustee shall accept its appointment
unless at the time of such acceptance such successor Indenture Trustee shall
be qualified and eligible under this Article.
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Section 612. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Indenture 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 Indenture Trustee
shall be a party, or any corporation succeeding to all or substantially all
the corporate trust business of the Indenture Trustee, shall be the successor
of the Indenture Trustee hereunder, PROVIDED such corporation shall be
otherwise 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 Indenture Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Indenture Trustee may
adopt such authentication and deliver the Securities so authenticated with
the same effect as if such successor Indenture Trustee had itself
authenticated such Securities.
Section 613. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
If and when the Indenture Trustee shall be or become a creditor of
the Company (or any other obligor upon the Securities), the Indenture Trustee
shall be subject to the provisions of the Trust Indenture Act regarding the
collection of claims against the Company (or any such other obligor).
Section 614. INVESTMENT OF CERTAIN PAYMENTS HELD BY THE INDENTURE TRUSTEE.
Any amounts held by the Indenture Trustee hereunder, other than
pursuant to Article Thirteen hereof, shall be invested by the Indenture
Trustee from time to time at the written direction of the Company in such
investments as may be specified by the Company and reasonably agreed to by
the Indenture Trustee from time to time; PROVIDED, that in investing trust
funds pursuant to the terms of this Section and liquidating any investments
held in trust hereunder, the Indenture Trustee may, to the extent permitted
by law, purchase securities (including for the purposes of this paragraph
securities as to which the Indenture Trustee or a Indenture Trustee Affiliate
(as defined below) is the issuer or guarantor) from, and sell securities to,
itself or any Indenture Trustee Affiliate and purchase securities
underwritten by, or in which a market is made by, the Indenture Trustee or a
Indenture Trustee Affiliate. For the purposes hereof, a "INDENTURE TRUSTEE
AFFILIATE" shall mean an entity that directly, or indirectly through one or
more intermediaries, controls, or is controlled by, or is under common
control with, the Indenture Trustee. Any income or gain realized as a result
of any such investment shall be promptly distributed (in no event later than
the next Business Day) to the Company after any intended amounts have been
paid to the Holders entitled thereto, except after the occurrence and during
the continuance of an Event of Default. The Indenture Trustee shall have no
liability to the Company for any loss resulting from any investment made in
accordance with this Section, and shall bear no expense in connection with
any investment pursuant to this Section. Any such investment may be sold
(without regard to maturity date) by the Indenture Trustee whenever necessary
to make any distribution required by this Indenture. Nothing herein shall
require the Indenture Trustee to invest funds held by it pursuant to the last
paragraph of SECTION 1003.
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Section 615. RIGHTS AND PROTECTIONS OF INDENTURE TRUSTEE THAT ALSO ACTS AS
PAYING AGENT OR SECURITY REGISTRAR
In the event that the Indenture Trustee is also acting as Paying
Agent or Security Registrar hereunder, the rights and protections afforded to
the Indenture Trustee pursuant to this Article 6 shall also be afforded to
such Paying Agent or Security Registrar.
Section 616. APPOINTMENT OF AUTHENTICATING AGENT.
The Indenture 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 Indenture Trustee to authenticate Securities of such
series issued upon original issue and upon exchange, registration of transfer
or partial redemption thereof or pursuant to SECTION 306, 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 Indenture
Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Indenture Trustee or the
Indenture Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Indenture
Trustee by an Authenticating Agent and a certificate of authentication
executed on behalf of the Indenture Trustee by an Authenticating Agent. Each
Authenticating Agent shall be acceptable to the Company and shall at all
times be a corporation organized and doing business under the laws of the
United States of America, any State thereof 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 authority. If such Authenticating Agent
publishes reports of condition at least annually, pursuant to law or to the
requirements of said 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. If 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 all or substantially
all the corporate agency or 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 any further act on the part of the
Indenture Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Indenture Trustee and to the Company. The Indenture
Trustee may at any time terminate the agency of an Authenticating Agent by
giving written notice thereof to such Authenticating Agent and to the
Company. Upon receiving such a notice of resignation or upon such a
termination, or in
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case at any time such Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, the Indenture Trustee may
appoint a successor Authenticating Agent which shall be acceptable to the
Company and shall mail written notice of such appointment by first-class
mail, postage prepaid, to all Holders of Securities of the series with
respect to which such Authenticating Agent will serve, as their names and
addresses appear in the Security Register. 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. 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 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 Indenture Trustee's certificate of
authentication, an alternative certificate of authentication in the following
form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
Dated: ____________________
Bankers Trust Company, As Indenture Trustee
By _______________________________________
As Authenticating Agent
By _______________________________________
Authorized Signatory
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ARTICLE SEVEN
Holders' Lists and Reports by Indenture Trustee and Company
Section 701. COMPANY TO FURNISH INDENTURE TRUSTEE NAMES AND ADDRESSES OF
HOLDERS.
The Company will furnish or cause to be furnished to the Indenture
Trustee (a) semi-annually, not later than 15 days after the Regular Record
Date for interest for each series of Securities, a list, in such form as the
Indenture Trustee may reasonably require, of the names and addresses of the
Holders as of such Regular Record Date, as the case may be, and (b) at such
other times as the Indenture Trustee may request in writing, within 30 days
after the receipt by the Company of any such request, a list in similar form
and content as of a date not more than 15 days prior to the time such list is
furnished. Notwithstanding the foregoing, so long as the Trustee is the
Security Registrar, no such list shall be required to be furnished.
Section 702. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(a) The Indenture Trustee shall preserve, in as current a form
as is reasonably practicable, the names and addresses of Holders contained in
the most recent list furnished to the Indenture Trustee as provided in
SECTION 701 and the names and addresses of Holders received by the Indenture
Trustee in its capacity as Security Registrar. The Indenture Trustee may
destroy any list furnished to it as provided in SECTION 701 upon receipt of a
new list so furnished.
(b) The rights of the Holders to communicate with other Holders
with respect to their rights under this Indenture or under the Securities,
and the corresponding rights and privileges of the Indenture Trustee, shall
be as provided by the Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Indenture Trustee that neither the
Company nor the Indenture Trustee nor any agent of either of them shall be
held accountable by reason of any disclosure of information as to names and
addresses of Holders made pursuant to the Trust Indenture Act.
Section 703. REPORTS BY INDENTURE TRUSTEE.
(a) The Indenture Trustee shall transmit to Holders such reports
concerning the Indenture Trustee and its actions under this Indenture as may
be required pursuant to the Trust Indenture Act at the times and in the
manner provided pursuant thereto. If required by Section 313(a) of the Trust
Indenture Act, the Indenture Trustee shall, within sixty days after each
[May 15] following the date of the first issuance of Securities hereunder
deliver to Holders a brief report, dated as of such [May 15], which complies
with the provisions of such Section 313(a). The Indenture Trustee also shall
comply with Sections 313(b) and 313(c) of the Trust Indenture Act.
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(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Indenture Trustee with each stock
exchange upon which any Securities are listed, with the Commission and with
the Company. The Company promptly will notify the Indenture Trustee in
writing when any Securities are listed on any stock exchange or delisted
therefrom.
Section 704. REPORTS BY COMPANY.
The Company shall file with the Indenture Trustee and the
Commission, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant to such Act;
PROVIDED, that any such information, documents or reports required to be
filed with the Commission pursuant to Section 13 or 15(d) of the Exchange Act
shall be filed with the Indenture Trustee within 15 days after the same is so
required to be filed with the Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.
The Company shall not consolidate with or merge into any other
entity or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, unless:
(1) the Person formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance, transfer or
lease the properties and assets of the Company substantially as an entirety
shall be a corporation, partnership or trust organized and validly existing
under the laws of the United States of America, any State thereof or the
District of Columbia and shall expressly assume, by an indenture supplemental
hereto, executed and delivered to the Indenture Trustee, in form satisfactory
to the Indenture Trustee, the due and punctual payment of the principal of
(and premium, if any) and interest on all the Securities and the performance
of every covenant and the satisfaction of every condition of this Indenture
on the part of the Company to be performed, observed or satisfied;
(2) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have occurred and be continuing; and
(3) the Company has delivered to the Indenture Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and such supplemental
indenture comply with this Article and that all conditions precedent herein
provided for relating to such transaction have been complied with.
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This Section shall not apply to any merger or consolidation in
which the Company is the surviving entity.
Section 802. SUCCESSOR SUBSTITUTED.
Upon any consolidation of the Company with, or merger of the
Company into, any other Person or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety in
accordance with SECTION 801, the successor Person formed by such
consolidation or into which the Company is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this
Indenture with the same effect as if such successor Person had been named as
the Company herein, and thereafter, except in the case of a lease, the
predecessor Person shall be relieved of all obligations and covenants under
this Indenture and the Securities.
Section 803. OFFICERS' CERTIFICATE AND OPINION OF COUNSEL.
The Indenture Trustee, subject to the provisions of SECTIONS 601
and 603, shall receive an Officers' Certificate and an Opinion of Counsel as
conclusive evidence that any such consolidation, merger, conveyance, transfer
or lease, and any such assumption, complies with the provisions of this
Article before the Indenture Trustee shall execute any supplemental indenture
required pursuant to this Article.
ARTICLE NINE
Supplemental Indentures
Section 901. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company, when authorized by
a Board Resolution, and the Indenture Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Indenture Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company
and the assumption by any such successor of the covenants 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 of 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
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(3) to add any additional Events of Default with respect to all
or any series of Securities; or
(4) to add to or change any of the provisions of this Indenture
to such extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to permit or facilitate the issuance
of Securities in uncertificated form or in the form of Book- Entry
Securities; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities; PROVIDED, that any
such addition, change or elimination (i) shall neither (A) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (B) modify the
rights of the Holder of any such Security with respect to such provision or
(ii) shall become effective only when there is no such Security Outstanding;
or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series
as permitted by SECTIONS 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Indenture 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 Indenture Trustee,
pursuant to the requirements of SECTION 611(b); or
(9) if allowed, without penalty under applicable laws and
regulations, to permit payment in the United States (including any of the
States thereof and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction of principal,
premium, if any, or interest, if any, on Securities in bearer form or
coupons, if any; or
(10) to cure any ambiguity, to correct or supplement any
provision herein which may be defective or inconsistent with any other
provision herein or to make any other provisions with respect to matters or
questions arising under this Indenture; PROVIDED, that such action pursuant
to this clause (10) other than with respect to a defective provision, shall
not adversely affect the interests of the Holders of Securities Outstanding
of any series in any material respect.
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Section 902. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series adversely
affected by such supplemental indenture (or, if any of the Securities of that
series are Original Issue Discount Securities or Indexed Securities, such
portion of the principal amount of such Securities as may be specified in the
terms thereof), by Act of said Holders delivered to the Company and the
Indenture Trustee, the Company, when authorized by a Board Resolution, and
the Indenture Trustee may enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders of Securities of such series under this
Indenture; PROVIDED, HOWEVER, that no such supplemental indenture shall,
without the consent of the Holder of each Outstanding Security affected
thereby,
(1) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or any premium
payable upon the redemption thereof, or reduce the amount of the principal of
an Original Issue Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to SECTION 502,
or change any Place of Payment where, or the coin or currency in which, any
Security or any premium or interest 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), or adversely affect any right of the Holder of any Security
to require the Company to repurchase such Securities, or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, 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, or
(3) modify any of the provisions of this Section, SECTION 513 or
SECTION 1009, except to increase any percentage set forth in such Sections or
to provide that certain other provisions of this Indenture cannot be modified
or waived without the consent of the Holder of each Outstanding Security
affected thereby; PROVIDED, HOWEVER, that this clause shall not be deemed to
require the consent of any Holder with respect to changes in the references
to "the Indenture Trustee" and concomitant changes in this Section and
SECTION 1009, or the deletion of this proviso, in accordance with the
requirements of SECTIONS 611(b) and 901(8).
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.
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It shall not be necessary for any Act of Holders under this Section
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.
Section 903. EXECUTION OF SUPPLEMENTAL INDENTURES.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby
of the trusts created by this Indenture, the Indenture Trustee shall be
entitled to receive, and (subject to SECTION 601) shall be fully protected in
relying upon, an Officers' Certificate and an Opinion of Counsel, each
stating that the execution of such supplemental indenture is authorized and
permitted by this Indenture and, in the case of such Opinion of Counsel, that
such supplemental indenture, when executed by the Trustee, will constitute a
valid and legally binding obligation of the Company, enforceable in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles. The Indenture Trustee may, but shall not be obligated to,
enter into any such supplemental indenture which affects the Indenture
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Section 904. 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 shall be bound thereby.
Section 905. CONFORMITY WITH TRUST INDENTURE ACT.
Every supplemental indenture executed pursuant to this Article
shall conform to the requirements of the Trust Indenture Act.
Section 906. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and
shall if required by the Indenture Trustee, bear a notation in form approved
by the Indenture Trustee as to any matter provided for in such supplemental
indenture. If the Company shall so determine, new Securities of any series so
modified as to conform, in the opinion of the Indenture Trustee and the
Company, to any such supplemental indenture may be prepared and executed by
the Company and authenticated and delivered by the Indenture Trustee in
exchange for Outstanding Securities of such series.
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ARTICLE TEN
Covenants
Section 1001. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of (and
premium, if any) and interest on the Securities of the series in accordance
with the terms of the Securities and this Indenture.
Section 1002. MAINTENANCE OF OFFICE OR AGENCY.
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. The Indenture Trustee is hereby initially
appointed Paying Agent, and the Corporate Trust Office of the Indenture
Trustee is initially designated as the office or agency for the foregoing
purposes. The Company will give prompt written notice to the Indenture
Trustee of the location, and any change in the location, of 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 Indenture Trustee with the
address thereof, such presentations, surrenders, notices and demands may be
made or served at the Corporate Trust Office of the Indenture Trustee, and
the Company hereby appoints the Indenture Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies where the Securities 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 agency in each Place of Payment for Securities of any
series for such purposes. The Company will give prompt written notice to the
Indenture Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.
1003. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST.
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 (and premium, if any) or interest 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 (and 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
Indenture Trustee of its action or failure so to act.
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Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, on or before each due date of the principal of
(and premium, if any) or interest on any Securities of that series, deposit
with a Paying Agent a sum sufficient to pay the principal (and premium, if
any) or interest so becoming due, such sum to be held in trust for the
benefit of the Persons entitled to such principal, premium or interest, and
(unless such Paying Agent is the Indenture Trustee) the Company will promptly
notify the Indenture Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of
Securities other than the Indenture Trustee to execute and deliver to the
Indenture Trustee an instrument in which such Paying Agent shall agree with
the Indenture Trustee, subject to the provisions of this Section, that such
Paying Agent will:
(1) hold all sums held by it for the payment of the
principal of (and premium, if any) or interest 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 Indenture Trustee notice of any default
by the Company (or any other obligor upon the Securities of that
series) in the making of any payment of principal (and premium,
if any) or interest on the Securities of that series; and
(3) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee,
forthwith pay to the Indenture 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 of this Indenture or for any other purpose, pay,
or by Company Order direct any Paying Agent to pay, to the Indenture Trustee
all sums held in trust by the Company or such Paying Agent, such sums to be
held by the Indenture Trustee upon the same trusts 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 Indenture Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Any money deposited with the Indenture Trustee or any Paying Agent,
or received by the Indenture Trustee in respect of obligations deposited with
the Indenture Trustee pursuant to ARTICLE THIRTEEN, or then held by the
Company, in trust for the payment of the principal of (and premium, if any)
or interest on any Security of any series and remaining unclaimed for two
years after such principal (and premium, if any) or interest has become due
and payable shall be paid to the Company on Company Request (unless otherwise
required by mandatory provisions of applicable escheat or abandoned or
unclaimed property law), or (if then held by the Company) shall be discharged
from such trust; and the Holder of such Security shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof
(unless the Company has remitted
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required moneys or other property to the appropriate governmental authority
under any applicable escheat or abandoned or unclaimed property laws, or has
otherwise been discharged under such laws or laws of similar applicability,
in which case such Holder shall look solely to its remedies (if any) under
such laws and not to the Company), and all liability of the Indenture 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 Indenture 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],
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.
Section 1004. PAYMENT OF TAXES AND OTHER CLAIMS.
The Company will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all taxes,
assessments and governmental charges levied or imposed upon the Company or
any Subsidiary or upon the income or profits of the Company or any
Subsidiary, and (2) all lawful claims for labor materials and supplies which,
if unpaid, might by law become a lien upon any property of the Company or any
Subsidiary; PROVIDED, HOWEVER, that the Company shall not be required to pay
or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim (a) whose amount, applicability or validity is being
contested in good faith by appropriate proceedings or (b) which is not of
material importance to the business, operations, financial condition or
results of operations of the Company and its Subsidiaries taken as a whole.
Section 1005. MAINTENANCE OF PROPERTIES.
The Company will cause all of its material properties used or
useful in the conduct of its business or the business of any Subsidiary to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all
times; PROVIDED, HOWEVER, that nothing in this Section shall prevent the
Company or any Subsidiary from selling or otherwise disposing for value its
properties in the ordinary course of its business.
Section 1006. TRUST EXISTENCE.
Subject to ARTICLE EIGHT, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect its real
estate investment trust existence, rights (charter and statutory) and
franchises; PROVIDED, HOWEVER, that the Company shall not be required to
preserve any such right or franchise if the Company shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company.
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Section 1007. LIMITATION UPON LIENS.
[The Company will not itself, and will not permit any Subsidiary
to, create, incur, issue, assume, guarantee or secure any notes, bonds,
debentures or other similar evidences of indebtedness for money borrowed (notes,
bonds, debentures or other similar evidences of indebtedness for money borrowed
being hereinafter in this Section and SECTION 1008 called "DEBT"), secured by
any pledge of, or mortgage, lien, encumbrance or security interest on (such
pledges, mortgages, liens, encumbrances and security interests being hereinafter
in this Section, in SECTION 801 and in SECTION 1008 collectively called
"LIENS"), any property owned or leased by the Company or any Subsidiary, or on
any shares or Debt of any Subsidiary owned or held by the Company or any other
Subsidiary, without effectively providing that the Securities (together with, if
the Company shall so determine, any other Debt of the Company or such Subsidiary
then existing or thereafter created which is not subordinate to the Securities)
shall be secured equally and ratably with (or prior to) such secured Debt (for
the purpose of providing such equal and ratable security, the principal amount
of any Securities shall mean the aggregate principal amount of such Securities
which are Outstanding and shall not be less than that principal amount which
could be declared to be due and payable pursuant to SECTION 502 on the date of
the making of such effective provision, and the extent of such equal and ratable
security shall be adjusted, to the extent permitted by law, as and when said
principal amount changes over time pursuant to SECTION 502 and any other
provision hereof), so long as such secured Debt shall be so secured, unless,
after giving effect thereto, the aggregate principal amount of all such secured
Debt then outstanding PLUS Attributable Debt of the Company and its Subsidiaries
in respect of Sale and Leaseback Transactions entered into after the date of
this Indenture (other than Sale and Leaseback Transactions permitted by SECTION
1008(b)) would not exceed an amount equal to 10% of Consolidated Net Assets;
PROVIDED, HOWEVER, that nothing contained in this Section shall prevent,
restrict or apply to, and there shall be excluded from secured Debt in any
computation under this Section, Debt secured by:
(a) Liens on any property or assets of the Company or any
Subsidiary or on any shares or Debt existing as of the date of this
Indenture;
(b) Liens on all property or assets of, or on any shares or Debt
of, any corporation existing at the time such corporation becomes a
Subsidiary;
(c) Liens on any property or assets or shares or Debt existing
at the time of acquisition thereof (including acquisition through merger
or consolidation) or securing the payment of all or any part of the
purchase price or construction cost thereof or securing any Debt
incurred prior to, at the time of or within 120 days after the
acquisition of such property or assets or shares or Debt or the
completion of any such construction, whichever is later, for the purpose
of financing all or any part of the purchase price or construction cost
thereof (PROVIDED, such Liens are limited to such shares or Debt,
property or assets, improvements thereon and the land upon which such
property, assets and improvements are located and any other property or
assets not then constituting a property);
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(d) Liens on any property or assets to secure all or any, part
of the cost of development, operation, construction, alteration, repair
or improvement of all or any part of such property, or assets, or to
secure Debt incurred prior to, at the time of or within 120 days after
the completion of such development, operation, construction, alteration,
repair or improvement, whichever is later, for the purpose of financing
all or any part of such cost (PROVIDED, such Liens are limited to such
property or assets, improvements thereon and the land upon which such
property, assets and improvements are located and any other property or
assets not then constituting a property);
(e) Liens which secure Debt owing to the Company or another
Subsidiary by a Subsidiary;
(f) (i) Liens arising from the assignment of moneys due and to
become due under contracts between the Company or any Subsidiary and the
United States of America, any State, Territory, or possession thereof or
any agency, department, instrumentality or political subdivision of any,
thereof, (ii) Liens in favor of the United States of America, any State,
Commonwealth, Territory or possession thereof or any agency, department,
instrumentality or political subdivision of any thereof, pursuant to the
provisions of any contract not directly or indirectly in connection with
securing Debt or (iii) Liens arising in connection with obligations
issued by a State, Commonwealth, Territory or possession of the United
States of America, or any political subdivision or governmental
authority of any of the foregoing, or the District of Columbia;
(g) any deposit or pledge as security for the performance of any
bid, tender, contract, lease or undertaking not directly or indirectly
in connection with the securing of Debt; any deposit or pledge with any
governmental agency required or permitted to qualify the Company or any
Subsidiary to conduct business, to maintain self-insurance or to obtain
the benefits of any law pertaining to workmen's compensation,
unemployment insurance, old age pensions, social security or similar
matters, or to obtain any stay or discharge in any legal or
administrative proceedings; deposits or pledges to obtain the release of
mechanics', workmen's, repairmen's, materialmen's or warehousemen's
liens or the release of property in the possession of a common carrier;
any security interest created in connection with the sale, discount or
guarantee of notes, chattel mortgages, leases, accounts receivable,
trade acceptances or other paper, or contingent repurchase obligations,
arising out of sales of merchandise in the ordinary course of business;
liens permitted by SECTION 1004; or other deposits or pledges similar to
those referred to in this subdivision (g);
(h) Liens arising by reason of any judgment, decree or order of
any court or other governmental authority, so long as any appropriate
legal proceedings which may have been initiated for the review of such
judgment, decree or order shall not have been finally terminated or so
long as the period within which such proceedings may be initiated shall
not have expired; and
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(i) any extension, renewal, substitution or replacement (or
successive extensions, renewals, substitutions or replacements), as a
whole or in part, of any of the Liens referred to in subdivisions (a)
through (h) above or the Debt secured thereby; PROVIDED, that (1) such
extension, renewal, substitution or replacement Lien shall be limited to
all or any part of the same property or assets, shares or Debt that
secured the Lien extended, renewed, substituted or replaced (plus
improvements on such property and any other property or assets not then
constituting a property) and (2) in the case of subdivisions (a) through
(c) above, the Debt secured by such Lien at such time is not increased.
Debt created by the Company or any Subsidiary shall not be
cumulated with a guarantee of the same Debt by the Company, or any other
Subsidiary for the same financial obligation.]
Section 1008. LIMITATION UPON SALES AND LEASEBACKS.
[The Company will not itself, and will not permit any Subsidiary
to, enter into any Sale and Leaseback Transaction after the date of this
Indenture, unless either:
(a) the Attributable Debt of the Company and its Subsidiaries in
respect of such Sale and Leaseback Transaction and all other Sale and
Leaseback Transactions entered into after the date of this Indenture
(other than Sale and Leaseback Transactions permitted by SECTION
1008(b)), plus the aggregate principal amount of Debt secured by Liens
on properties then outstanding (excluding any such Debt secured by Liens
covered in subdivisions (a) through (i) of the first paragraph of
SECTION 1007) without equally and ratably securing the Securities, would
not exceed 10% of Consolidated Net Assets, or
(b) the Company applies, within 120 days after the sale or
transfer, an amount equal to the fair market value of the property so
sold and leased back at the time of entering into such Sale and
Leaseback Transaction (as determined by any two of the following: [the
Chairman or Vice Chairman of the Board, the President, any Vice
Chairman, any Vice President, the Treasurer and the Controller] of the
Company) to (i) the purchase of any asset or any interest in an asset
which would qualify, after purchase, as a property or (ii) the
retirement of Funded Debt (including Securities of any series
constituting Funded Debt) of the Company (and any redemption of
Securities of any series pursuant to this provision shall, if provided
in the terms of such particular series of Securities, not be prohibited
pursuant to any redemption provision of such series otherwise
prohibiting redemption when such would constitute a refunding operation
or anticipated refunding operation or similar refunding operation);
PROVIDED, that the amount to be applied to the retirement of Funded Debt
of the Company shall be reduced by (i) the principal amount of
Securities delivered within 120 days after such sale or transfer to the
Indenture Trustee for redemption and cancellation, and (ii) the
principal amount of Funded Debt, other than Securities, voluntarily
retired by the Company within 120 days after such sale. For purposes of
clauses (i) and (ii) of the
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foregoing proviso, the principal amount of any Securities shall mean the
aggregate principal amount of such Securities which are Outstanding and
shall not be less than that principal amount which could be declared to
be due and payable pursuant to SECTION 502 at the time of determination.
Notwithstanding the foregoing, no retirement referred to in this
subdivision (b) may be effected by payment at maturity or pursuant to
any mandatory sinking fund payment or any mandatory prepayment
provision.
Notwithstanding the foregoing, where the Company or any Subsidiary
is the lessee in any Sale and Leaseback Transaction, Attributable Debt shall
not include any Debt resulting from the guarantee by the Company or any other
Subsidiary of the lessee's obligation thereunder.]
Section 1009. WAIVER OF CERTAIN COVENANTS.
The Company may omit in any particular instance to comply with any
covenant or condition set forth in SECTIONS 1004 to 1008, inclusive, with
respect to the Securities of any series if before or after the time for such
compliance the Holders of at least a majority in principal amount of the
Outstanding Securities of such series shall, by Act of such Holders, either
waive such compliance in such instance or generally waive compliance with
such covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until
such waiver shall become effective, the obligations of the Company and the
duties of the Indenture Trustee in respect of any such covenant or condition
shall remain in full force and effect.
The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Persons entitled to waive compliance with
any covenant or condition hereunder. If a record date is fixed, the Holders
on such record date, or their duly designated proxies, and only such Persons,
shall be entitled to waive any such compliance, whether or not such Holders
remain Holders after such record date.
Section 1010. COMPLIANCE CERTIFICATE.
The Company will furnish to the Indenture Trustee on or before
[May 1] in each year (beginning the first [May 1] after the date of original
issuance of Securities hereunder) a brief certificate (which need not comply
with SECTION 102) from the principal executive, financial or accounting
officer of the Company stating that in the course of the performance by the
signer of his or her duties as an officer of the Company he or she would
normally have knowledge of any default or non-compliance by the Company in
the performance of any covenants or conditions contained in this Indenture,
stating whether or not he or she has knowledge of any such default or
non-compliance and, if so, specifying each such default or non-compliance of
which the signer has knowledge and the nature thereof. For purposes of this
SECTION 1010, non-compliance or default shall be determined without regard to
any grace period or requirement of notice provided pursuant to the terms of
the Indenture.
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Section 1011. INSURANCE. The Company will, and will cause each of
its Subsidiaries to, keep all of its insurable properties insured against
loss or damage in commercially reasonable amounts with insurers of recognized
responsibility.
ARTICLE ELEVEN
Redemption of Securities
Section 1101. APPLICABILITY OF ARTICLE.
Securities of any series which are redeemable in whole or in part
before their Stated Maturity shall be redeemable in accordance with their
terms and (except as otherwise specified as contemplated by SECTION 301 for
Securities of any series) in accordance with this Article.
Section 1102. ELECTION TO REDEEM: NOTICE TO INDENTURE TRUSTEE.
The election of the Company to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution or Officers' Certificate. In
case of any redemption at the election of the Company of the Securities 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
Indenture Trustee), notify the Indenture Trustee in writing of such
Redemption Date, 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 redemption of Securities (a) prior to the expiration of
any restriction on such redemption provided in the terms of such Securities
or elsewhere in this Indenture or (b) pursuant to an election of the Company
which is subject to a condition specified in the terms of such Securities or
elsewhere in this Indenture, the Company shall furnish the Indenture Trustee
with an Officers' Certificate evidencing compliance with such restriction or
condition.
Section 1103. SELECTION BY INDENTURE TRUSTEE OF SECURITIES TO BE REDEEMED.
If less than all the Securities of any series are to be redeemed
(unless all of the Securities of such series and of a specified tenor are to
be redeemed or unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Indenture Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such
method as the Indenture 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. If less than all of the Securities of such series and of a
specified tenor are to be redeemed (unless such redemption affects only a
single Security), the particular Securities to be redeemed shall be selected
not more than 60 days prior to
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the Redemption Date by the Indenture Trustee, from the Outstanding Securities
of such series and specified tenor not previously called for redemption in
accordance with the preceding sentence.
The Indenture Trustee shall promptly notify the Company in writing
of the Securities selected for redemption and, in the case of any Securities
selected for partial redemption, the principal amount thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall
relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has
been or is to be redeemed.
Section 1104. NOTICE OF REDEMPTION.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed, at his address
appearing in the Security Register.
All notices of redemption shall identify the Securities to be
redeemed (including CUSIP numbers) and shall state:
(1) the Redemption Date,
(2) the Redemption Price, plus accrued interest, if any,
(3) in the case of partial redemption of any Securities, the
principal amounts of the particular Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price will become
due and payable upon each such Security, or portion thereof, to be redeemed
and, if applicable, that interest thereon will cease to accrue on and after
said date,
(5) the place or places where such Securities are to be
surrendered for payment of the Redemption Price,
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(6) that the redemption is for a sinking fund, if such is the
case, and
(7) that there exists a conversion privilege.
Notice of redemption of Securities to be redeemed at the election
of the Company shall be given by the Company or, at the Company's request, by
the Indenture Trustee in the name and at the expense of the Company
(PROVIDED, that the Indenture Trustee has received the notice of redemption
at least 45 days prior to the Redemption Date unless a shorter period is
agreed to by the Indenture Trustee) and shall be irrevocable.
Section 1105. DEPOSIT OF REDEMPTION PRICE.
On or prior to 11:00 a.m., New York City time, on the Redemption
Date, the Company shall deposit with the Indenture Trustee or with a Paying
Agent (or, if the Company is acting as its own Paying Agent, segregate and
hold in trust as provided in SECTION 1003) an amount of money in the currency
or currencies in which the Securities of such series are payable (except as
otherwise specified pursuant to SECTION 301 for the Securities of such
series) sufficient to pay the Redemption Price of, and (except if the
Redemption Date shall be an Interest Payment Date) accrued interest on, all
the Securities or portions thereof which are to be redeemed on that date.
Section 1106. 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. Upon surrender of
any such Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price, together with
accrued interest to the Redemption Date; PROVIDED, HOWEVER, that, unless
otherwise specified as contemplated by SECTION 301, installments of interest
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 Securities,
registered as such at the close of business on the relevant Record Dates
according to their terms and the provisions of SECTION 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall, until
paid, bear interest from the Redemption Date at the rate prescribed therefor
in the Security.
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Section 1107. SECURITIES REDEEMED IN PART.
Any Security which is to be redeemed only in part shall be
surrendered at a Place of Payment therefor (with, if the Company or the
Indenture Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Indenture Trustee duly
executed by, the Holder thereof or his attorney duly authorized in writing),
and the Company shall execute, and the Indenture Trustee shall authenticate
and deliver or make available for delivery to the Holder of such Security
without service charge, a new Security or Securities of the same series and
of like tenor, of any authorized denomination as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed
portion of the principal of the Security so surrendered. If a Book-Entry
Security is so surrendered, such new Security so issued shall be a new
Book-Entry Security.
ARTICLE TWELVE
Sinking Funds
Section 1201. 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 301 for Securities of such series.
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 1202. 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 1202. SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.
The Company (1) may deliver Outstanding Securities of a series
(other than any previously called for redemption) and (2) 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 Indenture Trustee
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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 1203. REDEMPTION OF SECURITIES FOR SINKING FUND.
Not less than 45 days prior to each sinking fund payment date for
any series of Securities, the Company will deliver to the Indenture 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 by delivering and crediting
Securities of that series pursuant to SECTION 1202 and stating the basis for
such credit and that such Securities have not been previously so credited
and will also deliver to the Indenture Trustee any Securities to be so
delivered. Not less than 30 days before each such sinking fund payment date
the Indenture Trustee shall select the Securities to be redeemed upon such
sinking fund payment date in the manner specified in SECTION 1103 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 1104. Such notice
having been duly given, the redemption of such Securities shall be made upon
the terms and in the manner stated in SECTIONS 1106 and 1107.
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. APPLICABILITY OF ARTICLE; COMPANY'S OPTION TO EFFECT DEFEASANCE
OR COVENANT DEFEASANCE.
Unless, pursuant to SECTION 301, provision is made that either or
both of (a) defeasance of the Securities of a series under SECTION 1302 or
(b) covenant defeasance of the Securities of a series under SECTION 1303
shall not apply to the Securities of a series, then the provisions of such
Section or Sections, as the case may be, together with the other provisions
of this Article Thirteen, with such modifications thereto as may be specified
pursuant to SECTION 301 with respect to any Securities, shall be applicable
to the Securities of such series, and the Company may at its option by Board
Resolution, at any time, with respect to the Securities of such series, elect
to have either SECTION 1302 (if applicable) or SECTION 1303 (if applicable)
applied to the Outstanding Securities of such series upon compliance with the
conditions set forth below in this ARTICLE THIRTEEN.
Section 1302. DEFEASANCE AND DISCHARGE.
Upon the Company's exercise of its option (if applicable) to have
this Section applied to any series of Securities, the Company shall be deemed
to have been discharged from its obligations with respect to the Outstanding
Securities of such series on and after the date the conditions precedent set
forth below are satisfied (hereinafter, "DEFEASANCE"). For this purpose,
such defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by the Outstanding Securities
of such series which shall thereafter be
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deemed to be "OUTSTANDING" only for the purposes of the Sections of this
Indenture referred to in clauses (A) and (B) of this Section, and to have
satisfied all its other obligations under such Securities and this Indenture
insofar as such Securities are concerned (and the Indenture Trustee, at the
expense of the Company, shall execute proper instruments acknowledging the
same), except for the following which shall survive until otherwise
terminated or discharged hereunder: (A) the rights of Holders of Outstanding
Securities of such series to receive, solely from the trust fund described in
SECTION 1304 as more fully set forth in such Section, payments of the
principal of (and premium, if any) and interest on such Securities when such
payments are due, (B) the Company's obligations with respect to such
Securities under SECTIONS 305, 306, 1002 and 1003 and such obligations as
shall be ancillary thereto, (C) the rights, powers, trusts, duties,
immunities and other provisions in respect of the Indenture Trustee hereunder
and (D) this Article Thirteen. Subject to compliance with this ARTICLE
THIRTEEN, the Company may exercise its option under this SECTION 1302
notwithstanding the prior exercise of its option under SECTION 1303 with
respect to the Securities of such series. Following a defeasance, payment of
such Securities may not be accelerated because of an Event of Default.
Section 1303. COVENANT DEFEASANCE.
Upon the Company's exercise of its option (if applicable) to have
this Section applied to any Series of Securities, the Company shall be
released from its obligations under SECTIONS 801, 1007 and 1008 (and any
covenant made applicable to such Securities pursuant to SECTION 301) and the
occurrence of an event specified in SECTION 501(4) (with respect to any of
SECTIONS 801, 1007 or 1008 or any such covenant) (and any other Event of
Default applicable to such Securities that are determined pursuant to SECTION
301 to be subject to this provision) shall not be deemed to be an Event of
Default with respect to the Outstanding Securities of such series on and
after the date the conditions set forth below are satisfied (hereinafter,
"COVENANT DEFEASANCE"), and such Securities shall thereafter be deemed not to
be "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 801, 1007 or 1008 (and any other covenant made
applicable to such Security pursuant to SECTION 301) and any such Events of
Default, but shall continue to be deemed "OUTSTANDING" for all other purposes
hereunder. For this purpose, such covenant defeasance means that, with
respect to the Outstanding Securities of such series, 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 reason of any reference in any such
Section or such other covenant to any other provision herein or in any other
document, but the remainder of this Indenture and such Securities shall be
unaffected thereby. Notwithstanding the defeasance by the Company of its
obligations under SECTION 801, any successor shall be required to assume the
Company's obligations under SECTION 607 as a condition to such succession.
Section 1304. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE.
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The following shall be the conditions precedent to application of
either SECTION 1302 or SECTION 1303 to the Outstanding Securities of or
within such series:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Indenture Trustee (or another indenture trustee satisfying
the requirements of SECTION 609 who shall agree to comply with the provisions
of this ARTICLE THIRTEEN applicable to it) as trust funds in trust for the
purpose of making the following payments, specifically pledged as security
for, and dedicated solely to, the benefit of the Holders of such Securities,
(A) money in an amount (in such currency, currencies or currency units in
which such Securities are then specified as payable at Maturity), or (B) U.S.
Government Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide, not
later than one day before the due date of any payment, 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 public accountants
expressed in a written certification thereof delivered to the Indenture
Trustee, to pay and discharge, and which shall be applied by the Indenture
Trustee (or other qualifying indenture trustee) to pay and discharge, (i) the
principal of (and premium, if any) and interest on the Outstanding Securities
of such series upon the Maturity of such principal, premium, if any, or
interest and (ii) 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. Before such
a deposit the Company may make arrangements satisfactory to the Indenture
Trustee for the redemption of Securities at a future date or dates in
accordance with ARTICLE ELEVEN, which shall be given effect in applying the
foregoing. For this purpose, "U.S. GOVERNMENT OBLIGATIONS" means securities
that are (x) direct obligations of the United States of America for the
payment of which its full faith and credit is pledged or (y) obligations of a
Person controlled or supervised by and acting as an agency or instrumentality
of the United States of America the payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of
America, which, in either case, are not callable or redeemable at the option
of the issuer thereof, and shall also include a depositary receipt issued by
a bank (as defined in Section 3(a)(2) of the Securities Act) as custodian
with respect to any such U.S. Government Obligation or a specific payment of
principal of or interest on any such U.S. Government Obligation held by such
custodian for the account of the holder of such depositary 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 depositary receipt
from any amount received by the custodian in respect of the U.S. Government
Obligation or the specific payment of principal of or interest on the U.S.
Government Obligation evidenced by such depositary receipt.
(2) No Event of Default or event which with notice or lapse of
time or both would become an Event of Default with respect to the Securities
of such series shall have occurred and be continuing (A) on the date of such
deposit or (B) insofar as SECTIONS 501(5) and 501(6) are concerned, at any
time during the period ending on the 91st day after the date of such deposit
or, if longer, ending on the day following the expiration of the longest
preference period applicable to the Company in respect of such deposit (it
being understood that this condition shall not be deemed satisfied until the
expiration of such period).
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(3) Such defeasance or covenant defeasance shall not (A) cause
the Indenture Trustee for the Securities of such series to have a conflicting
interest as defined in SECTION 608 or for purposes of the Trust Indenture Act
with respect to any Securities of the Company or (B) result in the trust
arising from such deposit to constitute, unless it is qualified as, a
regulated investment company under the Investment Company Act of 1940, as
amended.
(4) Such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a default under, this Indenture or any
other material agreement or material instrument to which the Company is a
party or by which it is bound.
(5) In the case of an election under SECTION 1302, the Company
shall have delivered to the Indenture Trustee an Opinion of Counsel stating
that (x) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling, or (y) since the date 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 the Outstanding Securities of such series 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 amounts, in
the same manner and at the same times as would have been the case if such
defeasance had not occurred.
(6) In the case of an election under SECTION 1303, the Company
shall have delivered to the Indenture Trustee an Opinion of Counsel to the
effect that the Holders of the Outstanding Securities of such series 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.
(7) Such defeasance or covenant defeasance shall be effected in
compliance with any additional terms, conditions or limitations which may be
imposed on the Company in connection therewith pursuant to SECTION 301.
(8) The Company shall have delivered to the Indenture Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the defeasance under
SECTION 1302 or the covenant defeasance under SECTION 1303 (as the case may
be) have been complied with.
Section 1305. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to the provisions of the last paragraph of SECTION 1003,
all money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Indenture Trustee or other qualifying indenture trustee
(collectively, for purposes of this SECTION 1305, the "INDENTURE TRUSTEE")
pursuant to SECTION 1304 in respect of the Outstanding Securities of such
series shall be held in trust and applied by the Indenture Trustee, in
accordance with the provisions of such
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Securities and this Indenture, to the payment, either directly or through any
Paying Agent (but not including the Company acting as its own Paying Agent)
as the Indenture Trustee may determine, to the Holders of such Securities, of
all sums due and to become due thereon in respect of principal (and premium,
if any) and interest, but such money need not be segregated from other funds
except to the extent required by law.
The Company shall pay and indemnify the Indenture Trustee against
any tax, fee or other charge imposed on or assessed against the money or U.S.
Government Obligations deposited pursuant to SECTION 1304 or the principal
and interest received in respect thereof.
Anything herein to the contrary notwithstanding, the Indenture
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
SECTION 1304 which in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Indenture Trustee, are in excess of the amount thereof which
would then be required to be deposited to effect an equivalent defeasance or
covenant defeasance.
Section 1306. REINSTATEMENT.
If the Indenture Trustee or the Paying Agent is unable to apply any
money in accordance with SECTION 1305 by reason of any order or judgment or
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's obligations under the
Securities of such series shall be revived and reinstated as though no
deposit had occurred pursuant to this ARTICLE THIRTEEN until such time as the
Indenture Trustee or Paying Agent is permitted to apply all such money in
accordance with SECTION 1305; PROVIDED, HOWEVER, that if the Company makes
any payment of principal of (and premium, if any) or interest on any such
Security following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Securities to receive such
payment from the money held by the Indenture Trustee or the Paying Agent.
Section 1307. QUALIFYING INDENTURE TRUSTEE.
Any indenture trustee appointed pursuant to SECTION 1304 for the
purpose of holding trust funds deposited pursuant to that Section shall be
appointed under any agreement in form acceptable to the Indenture Trustee and
shall provide to the Indenture Trustee a certificate of such indenture
trustee, upon which certificate the Indenture Trustee shall be entitled to
conclusively rely, that all conditions precedent provided for herein to the
related defeasance or covenant defeasance have been complied with. In no
event shall the Indenture Trustee be liable for any acts or omissions of said
indenture trustee.
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ARTICLE FOURTEEN
of Organizers, Promoters, Shareholders, Officers, Trustees and
Employees
Section 1401. EXEMPTION FROM INDIVIDUAL LIABILITY.
No recourse under or upon any obligation, covenant or agreement of
the Company in this Indenture, or of any Security, or for any claim based
thereon or otherwise in respect thereof, shall be had against any organizer,
promoter, shareholder, officer, trustee, or employee, as such, past, present
or future, of the Company or of any successor entity, either directly or
through the Company or any successor entity, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise; it being expressly understood that this Indenture,
any supplemental indenture modifying this Indenture and the obligations
issued hereunder are solely real estate investment trust obligations of the
Company, and that no such personal liability whatever shall attach to, or is
or shall be incurred by, the organizers, promoters, shareholders, officers,
trustees, or employees, as such, of the Company or of any successor entity,
or any of them, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or agreements
contained in this Indenture, in any supplemental indenture modifying this
Indenture or in any of the Securities or implied therefrom; and that any and
all such personal liability, either at common law or in equity or by
constitution or statute, of, and any and all such rights and claims against,
every such organizer, promoter, shareholder, officer, trustee, or employee,
as such, because of the creation of the indebtedness hereby authorized, or
under or by reason of the obligations, covenants or agreements contained in
this Indenture, in any supplemental indenture modifying this Indenture, or in
any of the Securities or implied therefrom, are hereby expressly waived and
released as a condition of, and as a consideration for, the execution of this
Indenture, any supplemental indenture modifying this Indenture and the issue
of such Securities.
*****
This instrument may be executed in any number of counterparts, each
of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture
to be duly executed as of the day and year first above written.
PRIME GROUP REALTY TRUST
By: _______________________________________
Name:
Title:
BANKERS TRUST COMPANY, as Indenture Trustee
By: _______________________________________
Name:
Title:
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Exhibit 4.2
- -------------------------------------------------------------------------------
PRIME GROUP REALTY TRUST
TO
BANKERS TRUST COMPANY
as Indenture Trustee
__________
FORM
OF
INDENTURE
Dated as of ________, ____
Providing for Issuance of Subordinated
Debt Securities in Series
- -------------------------------------------------------------------------------
<PAGE>
PRIME GROUP REALTY TRUST
Certain Sections of this Indenture relating to Sections 310 through
318, inclusive, of the Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
- --------------- -----------------
<S> <C>
(S) 310(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 609
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 609
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .608, 610
(S) 311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 613
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 613
(S) 312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 701, 702(a)
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .702(b)
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .702(c)
(S) 313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .703(a)
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .703(a)
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .703(a)
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .703(b)
(S) 314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 704
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1008
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
(S) 315(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 602
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 514
i
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<S> <C>
(S) 316(a) (last sentence) . . . . . . . . . . . . . . . . . .101 ("Outstanding")
(a)(1)(A). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .502, 512
(a)(1)(B). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 513
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 508
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .104(c)
(S) 317(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 504
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1003
(S) 318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
- -------------------
</TABLE>
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Indenture.
ii
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE ONE
Definitions and Other Provisions of General Application . . . . . . . . . . . .1
Section 101. DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . .1
Section 102. COMPLIANCE CERTIFICATES AND OPINIONS . . . . . . . . . . . . . .8
Section 103. FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE . . . . . . . .9
Section 104. ACTS OF HOLDERS; RECORD DATES. . . . . . . . . . . . . . . . . 10
Section 105. NOTICES, ETC., TO INDENTURE TRUSTEE AND COMPANY. . . . . . . . 11
Section 106. NOTICE TO HOLDERS; WAIVER. . . . . . . . . . . . . . . . . . . 11
Section 107. CONFLICT WITH TRUST INDENTURE ACT. . . . . . . . . . . . . . . 11
Section 108. EFFECT OF HEADINGS AND TABLE OF CONTENTS . . . . . . . . . . . 12
Section 109. SUCCESSORS AND ASSIGNS . . . . . . . . . . . . . . . . . . . . 12
Section 110. SEPARABILITY CLAUSE. . . . . . . . . . . . . . . . . . . . . . 12
Section 111. BENEFITS OF INDENTURE. . . . . . . . . . . . . . . . . . . . . 12
Section 112. GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 113. LEGAL HOLIDAYS . . . . . . . . . . . . . . . . . . . . . . . . 12
ARTICLE TWO
Security Forms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 201. FORMS GENERALLY. . . . . . . . . . . . . . . . . . . . . . . . 13
Section 202. FORM OF FACE OF SECURITY . . . . . . . . . . . . . . . . . . . 13
Section 203. FORM OF REVERSE OF SECURITY. . . . . . . . . . . . . . . . . . 15
Section 204. ADDITIONAL PROVISIONS REQUIRED IN BOOK-ENTRY SECURITY. . . . . 26
Section 205. FORM OF INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION. . . 26
ARTICLE THREE
The Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 301. AMOUNT UNLIMITED; ISSUABLE IN SERIES . . . . . . . . . . . . . 27
Section 302. DENOMINATIONS. . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 303. EXECUTION, AUTHENTICATION, DELIVERY AND DATING . . . . . . . . 29
Section 304. TEMPORARY SECURITIES . . . . . . . . . . . . . . . . . . . . . 32
Section 305. REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE;
RESTRICTIONS ON TRANSFER . . . . . . . . . . . . . . . . . . 32
Section 306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES . . . . . . . 38
Section 307. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED . . . . . . . . 39
Section 308. PERSONS DEEMED OWNERS. . . . . . . . . . . . . . . . . . . . . 41
Section 309. CANCELLATION . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 310. COMPUTATION OF INTEREST. . . . . . . . . . . . . . . . . . . . 42
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Section 311. CUSIP NUMBERS. . . . . . . . . . . . . . . . . . . . . . . . . 42
ARTICLE FOUR
Satisfaction and Discharge. . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 401. SATISFACTION AND DISCHARGE OF INDENTURE. . . . . . . . . . . . 42
Section 402. APPLICATION OF TRUST MONEY . . . . . . . . . . . . . . . . . . 44
ARTICLE FIVE
Events of Default and Remedies. . . . . . . . . . . . . . . . . . . . . . . . 44
Section 501. EVENTS OF DEFAULT. . . . . . . . . . . . . . . . . . . . . . . 44
Section 502. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT . . . . . . 45
Section 503. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
INDENTURE TRUSTEE. . . . . . . . . . . . . . . . . . . . . . 46
Section 504. INDENTURE TRUSTEE MAY FILE PROOFS OF CLAIM . . . . . . . . . . 47
Section 505. INDENTURE TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 506. APPLICATION OF MONEY COLLECTED . . . . . . . . . . . . . . . . 48
Section 507. LIMITATION ON SUITS. . . . . . . . . . . . . . . . . . . . . . 48
Section 508. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM
AND INTEREST . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 509. RESTORATION OF RIGHTS AND REMEDIES . . . . . . . . . . . . . . 49
Section 510. RIGHTS AND REMEDIES CUMULATIVE . . . . . . . . . . . . . . . . 49
Section 511. DELAY OR OMISSION NOT WAIVER . . . . . . . . . . . . . . . . . 50
Section 512. CONTROL BY HOLDERS . . . . . . . . . . . . . . . . . . . . . . 50
Section 513. WAIVER OF PAST DEFAULTS. . . . . . . . . . . . . . . . . . . . 50
Section 514. UNDERTAKING FOR COSTS. . . . . . . . . . . . . . . . . . . . . 51
ARTICLE SIX
The Indenture Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 601. CERTAIN DUTIES AND RESPONSIBILITIES. . . . . . . . . . . . . . 51
Section 602. NOTICE OF DEFAULTS . . . . . . . . . . . . . . . . . . . . . . 51
Section 603. CERTAIN RIGHTS OF INDENTURE TRUSTEE. . . . . . . . . . . . . . 52
Section 604. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES . . . . 53
Section 605. MAY HOLD SECURITIES AND SERVE AS INDENTURE TRUSTEE UNDER
OTHER INDENTURES . . . . . . . . . . . . . . . . . . . . . . 53
Section 606. MONEY HELD IN TRUST. . . . . . . . . . . . . . . . . . . . . . 54
Section 607. COMPENSATION AND REIMBURSEMENT . . . . . . . . . . . . . . . . 54
Section 608. DISQUALIFICATION; CONFLICTING INTERESTS. . . . . . . . . . . . 55
Section 609. CORPORATE INDENTURE TRUSTEE REQUIRED; ELIGIBILITY. . . . . . . 55
Section 610. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. . . . . . . 55
Section 611. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR . . . . . . . . . . . . 57
iv
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Section 612. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS. . 58
Section 613. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. . . . . . . 58
Section 614. INVESTMENT OF CERTAIN PAYMENTS HELD BY THE INDENTURE TRUSTEE . 58
Section 615. RIGHTS AND PROTECTIONS OF INDENTURE TRUSTEE THAT ALSO ACTS
AS PAYING AGENT OR SECURITY REGISTRAR . . . . . . . . . . . 59
Section 616. APPOINTMENT OF AUTHENTICATING AGENT. . . . . . . . . . . . . . 59
ARTICLE SEVEN
Holders' Lists and Reports by Indenture Trustee and Company . . . . . . . . . 61
Section 701. COMPANY TO FURNISH INDENTURE TRUSTEE NAMES AND ADDRESSES OF
HOLDERS. . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 702. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS . . . . 61
Section 703. REPORTS BY INDENTURE TRUSTEE . . . . . . . . . . . . . . . . . 62
Section 704. REPORTS BY COMPANY . . . . . . . . . . . . . . . . . . . . . . 62
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease . . . . . 62
Section 801. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS . . . . . 62
Section 802. SUCCESSOR SUBSTITUTED. . . . . . . . . . . . . . . . . . . . . 63
Section 803. OFFICERS' CERTIFICATE AND OPINION OF COUNSEL . . . . . . . . . 63
ARTICLE NINE
Supplemental Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 901. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS . . . . . . 64
Section 902. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS. . . . . . . . 65
Section 903. EXECUTION OF SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . 66
Section 904. EFFECT OF SUPPLEMENTAL INDENTURES. . . . . . . . . . . . . . . 66
Section 905. CONFORMITY WITH TRUST INDENTURE ACT. . . . . . . . . . . . . . 66
Section 906. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES . . . . . . 67
ARTICLE TEN
Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 1001. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST . . . . . . . . . . 67
Section 1002. MAINTENANCE OF OFFICE OR AGENCY. . . . . . . . . . . . . . . . 67
Section 1003. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST. . . . . . . 68
Section 1004. PAYMENT OF TAXES AND OTHER CLAIMS. . . . . . . . . . . . . . . 69
Section 1005. MAINTENANCE OF PROPERTIES. . . . . . . . . . . . . . . . . . . 69
Section 1006. TRUST EXISTENCE. . . . . . . . . . . . . . . . . . . . . . . . 70
Section 1007. WAIVER OF CERTAIN COVENANTS. . . . . . . . . . . . . . . . . . 70
Section 1008. COMPLIANCE CERTIFICATE . . . . . . . . . . . . . . . . . . . . 70
v
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ARTICLE ELEVEN
Redemption of Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 1101. APPLICABILITY OF ARTICLE . . . . . . . . . . . . . . . . . . . 71
Section 1102. ELECTION TO REDEEM: NOTICE TO INDENTURE TRUSTEE. . . . . . . . 71
Section 1103. SELECTION BY INDENTURE TRUSTEE OF SECURITIES TO BE REDEEMED. . 71
Section 1104. NOTICE OF REDEMPTION . . . . . . . . . . . . . . . . . . . . . 72
Section 1105. DEPOSIT OF REDEMPTION PRICE. . . . . . . . . . . . . . . . . . 73
Section 1106. SECURITIES PAYABLE ON REDEMPTION DATE. . . . . . . . . . . . . 73
Section 1107. SECURITIES REDEEMED IN PART. . . . . . . . . . . . . . . . . . 73
ARTICLE TWELVE
Sinking Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 1201. APPLICABILITY OF ARTICLE . . . . . . . . . . . . . . . . . . . 74
Section 1202. SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES. . . . . 74
Section 1203. REDEMPTION OF SECURITIES FOR SINKING FUND. . . . . . . . . . . 74
ARTICLE THIRTEEN
Subordination of Securities . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 1301. SECURITIES SUBORDINATE TO SENIOR DEBT. . . . . . . . . . . . . 75
Section 1302. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC . . . . . . . . 75
Section 1303. ACCELERATION; SENIOR DEBT IN DEFAULT . . . . . . . . . . . . . 76
Section 1304. PAYMENT PERMITTED IF NO DEFAULT. . . . . . . . . . . . . . . . 77
Section 1305. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT. . . . . . . . 77
Section 1306. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. . . . . . . . . . 77
Section 1307. INDENTURE TRUSTEE TO EFFECTUATE SUBORDINATION. . . . . . . . . 78
Section 1308. NO WAIVER OF SUBORDINATION PROVISIONS. . . . . . . . . . . . . 78
Section 1309. NOTICE TO INDENTURE TRUSTEE. . . . . . . . . . . . . . . . . . 78
Section 1310. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 1311. INDENTURE TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT . . 79
Section 1312. RIGHTS OF INDENTURE TRUSTEE AS HOLDER OF SENIOR DEBT;
PRESERVATION OF INDENTURE TRUSTEE'S RIGHTS . . . . . . . . . 80
Section 1313. ARTICLE APPLICABLE TO PAYING AGENTS. . . . . . . . . . . . . . 80
Section 1314. DEFEASANCE OF THIS ARTICLE THIRTEEN. . . . . . . . . . . . . . 80
ARTICLE FOURTEEN
Conversion of Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Section 1401. APPLICABILITY OF ARTICLE . . . . . . . . . . . . . . . . . . . 80
Section 1402. CONVERSION PRIVILEGE AND CONVERSION PRICE. . . . . . . . . . . 81
Section 1403. EXERCISE OF CONVERSION PRIVILEGE . . . . . . . . . . . . . . . 81
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Section 1404. FRACTIONS OF SHARES. . . . . . . . . . . . . . . . . . . . . . 82
Section 1405. ADJUSTMENT OF CONVERSION PRICE . . . . . . . . . . . . . . . . 82
Section 1406. NOTICE OF ADJUSTMENTS OF CONVERSION PRICE. . . . . . . . . . . 86
Section 1407. NOTICE OF CERTAIN CORPORATE ACTION . . . . . . . . . . . . . . 86
Section 1408. COMPANY TO RESERVE COMMON SHARES . . . . . . . . . . . . . . . 87
Section 1409. TAXES ON CONVERSIONS . . . . . . . . . . . . . . . . . . . . . 87
Section 1410. COVENANT AS TO COMMON SHARES . . . . . . . . . . . . . . . . . 88
ARTICLE FIFTEEN
Defeasance and Covenant Defeasance. . . . . . . . . . . . . . . . . . . . . . 89
Section 1501. APPLICABILITY OF ARTICLE; COMPANY'S OPTION TO EFFECT
DEFEASANCE OR COVENANT DEFEASANCE. . . . . . . . . . . . . . 89
Section 1502. DEFEASANCE AND DISCHARGE . . . . . . . . . . . . . . . . . . . 89
Section 1503. COVENANT DEFEASANCE. . . . . . . . . . . . . . . . . . . . . . 90
Section 1504. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE. . . . . . . . 90
Section 1505. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD
IN TRUST; OTHER MISCELLANEOUS PROVISIONS . . . . . . . . . . 92
Section 1506. REINSTATEMENT. . . . . . . . . . . . . . . . . . . . . . . . . 93
Section 1507. QUALIFYING INDENTURE TRUSTEE . . . . . . . . . . . . . . . . . 93
ARTICLE SIXTEEN
Immunity of Organizers, Promoters, Shareholders, Officers, Trustees and
Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
Section 1601. EXEMPTION FROM INDIVIDUAL LIABILITY. . . . . . . . . . . . . . 93
- ---------------------
</TABLE>
NOTE: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
vii
<PAGE>
INDENTURE, dated as of _________ __, ______, between Prime
Group Realty Trust, a real estate investment trust duly organized and
existing under the laws of the State of Maryland (herein called the
"COMPANY"), having its principal office at 77 West Wacker Drive, Suite 3900,
Chicago, Illinois 60601, and Bankers Trust Company, a New York banking
corporation, as Indenture Trustee (herein called the "INDENTURE TRUSTEE").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its
subordinated unsecured debentures, notes or other evidences of indebtedness
(herein called the "SECURITIES"), to be issued in one or more series as
provided in this Indenture.
The Company has duly authorized the execution and delivery of
this Indenture to provide, among other things, for the authentication,
delivery and administration of the Securities.
All things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or each series thereof,
as follows:
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. DEFINITIONS.
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 generally accepted accounting
principles, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any
1
<PAGE>
computation required or permitted hereunder shall mean such accounting
principles as are generally accepted at the date of such computation in the
United States of America; and
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Indenture; and
(5) 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.
"ACT", when used with respect to any Holder, has the meaning
specified in SECTION 104.
"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 the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities or other ownership interests,
by contract or otherwise; and the terms "CONTROLLING" and "CONTROLLED" have
meanings correlative to the foregoing.
"AUTHENTICATING AGENT" means any Person authorized by the
Indenture Trustee pursuant to SECTION 616 to act on behalf of the Indenture
Trustee to authenticate Securities of one or more series.
"BOARD OF TRUSTEES" means either the board of trustees of the
Company or any duly authorized committee of that board.
"BOARD RESOLUTION" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Trustees and to be in full force and effect on the date of such
certification, and delivered to the Indenture Trustee.
"BOOK-ENTRY SECURITY" means a Security in the form prescribed in
SECTION 204 evidencing all or part of a series of Securities, issued to the
Depositary for such series or its nominee, and registered in the name of such
Depositary or such nominee.
"BUSINESS DAY", when used with respect to any Place of Payment,
means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on
which banking institutions in that Place of Payment or the city in which the
principal corporate trust office of the Trustee is located 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 Exchange Act, or, if at any
time after the execution of this instrument 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.
2
<PAGE>
"COMMON SHARES" means any class of shares of beneficial interest
of the Company which has no preference in respect of dividends or distributions
or of amounts payable in the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Company and which is not subject to redemption
by the Company. However, subject to the provisions of SECTION 1411, shares
issuable on conversion of Securities shall include only shares of the class
designated as Common Shares of the Company at the date of this instrument or
shares of any class or classes resulting from any reclassification or
reclassifications thereof and which have no preference in respect of dividends
or distributions or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Company and which are
not subject to redemption by the Company; PROVIDED, that if at any time there
shall be more than one such resulting class, the shares of each such class then
so issuable shall be substantially in the proportion which the total number of
shares of such class resulting from all such reclassifications bears to the
total number of shares of all such classes resulting from all such
reclassifications.
"COMPANY" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"COMPANY REQUEST" or "COMPANY ORDER" means a written request or
order signed in the name of the Company by its Chairman of the Board, its Chief
Executive Officer, its President, its Chief Financial Officer or a Vice
President, and by its Treasurer, an Assistant Treasurer, its Secretary or an
Assistant Secretary, and delivered to the Indenture Trustee.
"CORPORATE TRUST OFFICE" means the principal office of the
Indenture Trustee at which at any particular time its corporate trust business
shall be principally administered, which office at the date of original
execution of this Indenture is located at Four Albany Street, New York, New York
10006, Attention: Corporate Trust and Agency Group or at any other time at such
other address as the Indenture Trustee may designate from time to time by notice
to the Holders, except that, with respect to presentation of the Securities for
payment or registration of transfers or exchanges and the location of the
register, such term means the office or agency of the Indenture Trustee at which
at any particular time its corporate agency business shall be conducted.
"DEFAULTED INTEREST" has the meaning specified in SECTION 307.
"DEFINITIVE SECURITY" means Securities that are in the form of
the Securities set forth in ARTICLE TWO, that do not include the information
called for by SECTION 204.
"DEPOSITARY" means, with respect to the Securities of any
series issuable or issued in whole or in part in the form of one or more
Book-Entry Securities, the Person designated as Depositary for such series by
the Company pursuant to SECTION 301(n), which Person shall be a clearing
agency registered under the Exchange Act; and if at any time there is more
than one such Person, "Depositary" as used with respect to the Securities of
any series shall mean the Depositary with respect to the Securities of such
series.
3
<PAGE>
EVENT OF DEFAULT" has the meaning specified in SECTION 501.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXCHANGE OFFER" means any registered exchange offer made by the
Company solely to facilitate the exchange of an Outstanding series of Securities
for the related Exchange Securities.
"EXCHANGE SECURITIES" means any Securities issued by the Company
solely to facilitate a registered exchange of such Securities for any series of
Securities with substantially identical terms previously issued in a private
placement of such Outstanding Securities.
"EXPIRATION TIME" has the meaning specified in SECTION 1405(6).
"HOLDER" means a Person in whose name a Security is registered in
the Security Register.
"INDENTURE" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument, and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the forms and terms of
particular series of Securities established as contemplated by SECTION 301.
"INDENTURE TRUSTEE" means the Person named as the "Indenture
Trustee" in the first paragraph of this instrument until a successor Indenture
Trustee shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Indenture Trustee" shall mean or include each Person
who is then a Indenture Trustee hereunder, and if at any time there is more than
one such Person, "Indenture Trustee" as used with respect to the Securities of
any series shall mean the Indenture Trustee with respect to Securities of that
series.
"INDEXED SECURITY" means any Security which provides 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.
"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
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herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"OFFICERS' CERTIFICATE" means a certificate signed by the
Chairman of the Board, the Chief Executive Officer, the President, the Chief
Financial Officer or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Company, and
delivered to the Indenture Trustee.
"OPINION OF COUNSEL" means a written opinion of counsel, in form
and substance reasonably acceptable to the Indenture Trustee, who may be counsel
for the Company, and who shall be acceptable to the Indenture Trustee.
"ORIGINAL ISSUE DISCOUNT SECURITY" means any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
SECTION 502.
"OUTSTANDING", when used with respect to Securities, means, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore canceled by the Indenture Trustee
or delivered to the Indenture Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Indenture Trustee or
any Paying Agent (other than the Company) in trust or set aside and segregated
in trust by the Company (if the Company shall act as its own Paying Agent) for
the Holders of such Securities; PROVIDED, that if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant to SECTION 1104
or provision therefor satisfactory to the Indenture Trustee has been made;
(iii) Securities, except to the extent provided in SECTIONS 1502
and 1503, with respect to which the Company has effected defeasance or covenant
defeasance as provided in ARTICLE FIFTEEN; and
(iv) Securities which have been paid pursuant to SECTION 306 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
of which there shall have been presented to the Indenture 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, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action 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, (i) the principal amount of an
Original Issue Discount
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Security that shall be deemed to be Outstanding shall be the amount of the
principal thereof that would be due and payable as of the date of such
determination upon acceleration of the Maturity thereof pursuant to SECTION
502, (ii) the principal amount of a Security denominated in one or more
foreign currencies or currency units shall be the U.S. dollar equivalent,
determined in the manner provided as contemplated by SECTION 301 on the date
of original issuance of such Security, of the principal amount (or, in the
case of an Original Issue Discount Security, the U.S. dollar equivalent on
the date of original issuance of such Security of the amount determined as
provided in (i) above) of such Security, (iii) the principal amount of any
Indexed Security 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 principal face amount of such Indexed Security at original
issuance, unless otherwise provided with respect to such Security pursuant to
SECTION 301, and (iv) except for the purpose of making the calculations
required by Section 313 of the Trust Indenture Act, 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 Indenture Trustee shall
be protected in relying upon any such request, demand, authorization,
direction, notice, consent, waiver or other action, only Securities which a
Responsible Officer of the Indenture 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 Indenture 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 or any premium or interest on any Securities on behalf of the
Company.
"PERSON" means any individual, corporation, partnership, limited
liability company, joint venture, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"PLACE OF PAYMENT", when used with respect to the Securities of
any series, means the place or places where the principal of and any premium and
interest on the Securities of that series are payable as specified as
contemplated by SECTIONS 301 and 1002.
"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 306 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.
"PURCHASED SHARES" has the meaning specified in SECTION 1405.
"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.
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"REDEMPTION PRICE", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"REGULAR RECORD DATE" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for that
purpose as contemplated by SECTION 301.
"RESPONSIBLE OFFICER" shall mean when used with respect to the
Indenture Trustee any officer within the Corporate Trust Office including any
Vice President, managing director, assistant vice president, secretary,
assistant secretary, treasurer or assistant treasurer or any other officer of
the Indenture Trustee customarily performing functions similar to those
performed by any of the above designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge and familiarity with the particular subject.
"SECURITY" or "SECURITIES" has the meaning stated in the first
recital of this Indenture and more particularly means any Securities
authenticated and delivered under this Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITIES PAYMENT" has the meaning specified in SECTION 1302.
"SECURITY REGISTER" and "SECURITY REGISTRAR" have the respective
meanings specified in SECTION 305.
"SENIOR DEBT" means, without duplication, the principal,
premium (if any) and unpaid interest on all present and future (i)
indebtedness of the Company for borrowed money, (ii) obligations of the
Company evidenced by credit agreements, loan agreements, bonds, debentures,
notes or similar instruments, (iii) indebtedness incurred, assumed or
guaranteed by the Company in connection with the acquisition by it or a
Subsidiary of any business, properties or assets (including, without
limitation, the acquisition of leasehold interests, (iv) obligations of the
Company as lessee under leases required to be capitalized on the balance
sheet of the lessee under generally accepted accounting principles, (v) all
indebtedness of the Company under interest rate and currency swaps, caps,
floors, collars, hedge agreements, forward contracts or similar agreements
and arrangements, (vi) reimbursement obligations of the Company in respect of
letters of credit relating to indebtedness or other obligations of the
Company that qualify as indebtedness or obligations of the kind referred to
in clauses (i) through (v) above, (vii) obligations of the Company under
direct or indirect guarantees in respect of, and obligations (contingent or
otherwise) to purchase or otherwise acquire, or otherwise to assure a
creditor against loss in respect of, indebtedness or obligations of others of
the kinds referred to in clauses (i) through (vi) above and (viii) renewals,
extensions, modifications, replacements, restatements and refundings of, or
any indebtedness or obligations issued in exchange for, any such indebtedness
or obligations described in clauses (i) through (vii) above and in this
clause (viii), in each case unless in the instrument creating or evidencing
the indebtedness or obligations or pursuant to which the same is outstanding
it is provided that such indebtedness or
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obligations are not superior in right of payment to the Securities.
Notwithstanding the foregoing, Senior Debt shall not include indebtedness of
the Company for trade payables.
"SPECIAL RECORD DATE" for the payment of any Defaulted Interest
means a date fixed by the Indenture Trustee pursuant to SECTION 307.
"STATED MATURITY", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such installment of principal or interest is due and payable.
"SUBSIDIARY" means any corporation, partnership or limited
liability company of which at least a majority of the outstanding voting stock,
partnership interest or limited liability company interest, as the case may be,
is at the time directly or indirectly owned by the Company, or by one or more
other Subsidiaries, or by the Company and one or more other Subsidiaries. For
purposes of this definition, "voting stock" means stock having by the terms
thereof ordinary voting power for the election of directors of such corporation
(irrespective of whether or not at the time stock of any other class or classes
of such corporation shall have or might have voting power by reason of the
happening of any contingency)
"TRADING DAY" means each Monday, Tuesday, Wednesday, Thursday and
Friday, other than any day on which securities are not traded on the applicable
securities exchange or in the applicable securities market.
"TRANSFER RESTRICTED SECURITIES" means Securities that have been
or are required to bear the legend set forth in SECTION 305(h) hereof.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; PROVIDED, HOWEVER,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"U.S. GOVERNMENT OBLIGATIONS" has the meaning specified in
SECTION 1504(1).
"VICE PRESIDENT", when used with respect to the Company or the
Indenture Trustee, means any vice president, whether or not designated by a
number or a word or words added before or after the title "vice president,"
including, without limitation, "executive vice president" and "senior vice
president."
Section 102. COMPLIANCE CERTIFICATES AND OPINIONS.
Upon any application or request by the Company to the Indenture
Trustee to take any action under any provision of this Indenture (except for the
initial issuances of Securities hereunder), the Company shall furnish to the
Indenture Trustee such certificates and opinions as may be required under the
Trust Indenture Act. Each such certificate or opinion shall be given in the
form of an
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Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth
in this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) 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;
(3) 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 covenant or condition has
been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 103. FORM OF DOCUMENTS DELIVERED TO INDENTURE 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
representations by counsel or an opinion of counsel, unless such officer knows,
or in the exercise of reasonable care should know, that the certificate,
representations or opinion with respect to the matters upon which such officer's
certificate or opinion is based are erroneous. Any such certificate or
representations of counsel 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 with respect to such matters 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.
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Section 104. ACTS OF HOLDERS; RECORD DATES.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made 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 Indenture 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 (subject to SECTION
603) conclusive in favor of the Indenture 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 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 Indenture Trustee deems sufficient.
(c) The Company may fix any day as the record date for the
purpose of determining the Holders of Securities of any series entitled to give
or take any request, demand, authorization, direction, notice, consent, waiver
or other action, or to vote on any action, authorized or permitted to be given
or taken by Holders of Securities of such series. If not set by the Company
prior to the first solicitation of a Holder of Securities of such series made by
any Person in respect of any such action, or, in the case of any such vote,
prior to such vote, the record date for any such action or vote shall be the
30th day (or, if later, the date of the most recent list of Holders required to
be provided pursuant to SECTION 701) prior to such first solicitation or vote,
as the case may be. With regard to any record date for action to be taken by
the Holders of one or more series of Securities, only the Holders of Securities
of such series on such date (or their duly designated proxies) shall be entitled
to give or take, or vote on, the relevant action.
(d) The ownership of Securities shall be proved by the
Security 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 Indenture
Trustee or the Company in reliance thereon, whether or not notation of such
action is made upon such Security.
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Section 105. NOTICES, ETC., TO INDENTURE 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,
(1) the Indenture Trustee by any Holder or by the Company
shall be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Indenture Trustee at its Corporate Trust Office,
Attention: Corporate Trust and Agency Services.
(2) the Company by the Indenture Trustee or by any Holder
shall be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
the Company addressed to it at the address of its principal office specified in
the first paragraph of this instrument or at any other address previously
furnished in writing to the Indenture Trustee by the Company, Attention:
President, with a copy to the Company at the address of its principal office
specified in the first paragraph of this instrument or at any other address
previously furnished in writing to the Trustee by the Company, Attention:
General Counsel.
Section 106. NOTICE TO HOLDERS; WAIVER.
Where this Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each Holder
affected by such event, at such Holder's address as it appears in the Security
Register, not later than the latest date (if any), and not earlier than the
earliest date (if any), prescribed for the giving of such notice. In any case
where notice to Holders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders. 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. 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 the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Indenture Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Indenture
Trustee shall constitute a sufficient notification for every purpose hereunder.
Section 107. CONFLICT WITH TRUST INDENTURE ACT.
If any provision of this Indenture limits, qualifies or
conflicts with a provision of the Trust Indenture Act that is required under
such Act to be a part of and govern this Indenture, the provision of the
Trust Indenture Act shall control. If any provision of this Indenture
modifies or
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excludes any provision of the Trust Indenture Act that 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.
Section 108. EFFECT OF 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 109. 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 110. SEPARABILITY CLAUSE.
In case any provision in this Indenture or in 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 111. BENEFITS OF INDENTURE.
Nothing in this Indenture or in the Securities, express 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 112. GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF.
Section 113. LEGAL HOLIDAYS.
In any case where any Interest Payment Date, Redemption 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 the Securities (other than a provision of the Securities of any series which
specifically states that such provision shall apply in lieu of this Section))
payment of interest or principal (and premium, if any) need not be made at such
Place of Payment on such day, 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 the
Interest Payment Date, the Redemption Date, or at the Stated Maturity or
Maturity; PROVIDED, that no interest shall accrue for the intervening period.
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ARTICLE TWO
Security Forms
Section 201. FORMS GENERALLY.
The Securities of each series shall be in substantially the form
set forth in this Article, or in such other 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 Depositary therefor or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution of the Securities. If the form of Securities of any series is
established by, or by action taken pursuant to, a Board Resolution, a copy of an
appropriate record of such action shall be certified by the Secretary or an
Assistant Secretary of the Company and delivered to the Indenture Trustee at or
prior to the delivery of the Company Order contemplated by SECTION 303 for the
authentication and delivery of such Securities.
The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner
permitted by the rules of any securities exchange on which the Securities may be
listed, all as determined by the officers executing such Securities, as
evidenced by their execution of such Securities.
Section 202. FORM OF FACE OF SECURITY.
[INSERT ANY LEGEND REQUIRED BY THE INTERNAL REVENUE CODE AND THE
REGULATIONS THEREUNDER.]
[INSERT ANY LEGEND REQUIRED BY THE DEPOSITARY, IF APPLICABLE.]
PRIME GROUP REALTY TRUST
[INSERT DESIGNATION OF THE SERIES OF SECURITY.]
No.________ $__________
CUSIP No. _______________________
Prime Group Realty Trust, a real estate investment trust
[duly organized and existing] under the laws of Maryland (herein called the
"COMPANY", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
_______________, or registered assigns, the principal sum [IF BOOK-ENTRY
SECURITY, INSERT -- set forth above or such other principal sum on the Schedule
attached hereto (which shall not exceed $____)] [of _________________ Dollars]
on ________________ [IF THE SECURITY IS TO BEAR INTEREST PRIOR TO MATURITY,
INSERT, and to
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pay interest thereon from __________ or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, semi-annually on
_________ and ___________ in each year, commencing __________, at the rate of
_____% per annum, until the principal hereof is paid or made available for
payment [IF APPLICABLE, INSERT -- and (to the extent that the payment of such
interest shall be legally enforceable) at the rate of _______% per annum on any
overdue principal and premium and on any overdue installment of interest].
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the ________ or _________ (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so punctually paid or duly provided for will forthwith cease to
be payable to the Holder on such Regular Record Date and may either be paid
to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest to be fixed by the Indenture
Trustee, notice whereof shall be given to Holders of Securities of this
series not less than 10 days prior to such Special Record Date, or be paid at
any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Securities of this series may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in said Indenture].
[IF THE SECURITY IS NOT TO BEAR INTEREST PRIOR TO MATURITY,
INSERT -- The principal of this Security shall not bear interest except in the
case of a default in payment of principal upon acceleration, upon redemption or
at Stated Maturity and in such case the overdue principal of this Security shall
bear interest at the rate of ____% per annum (to the extent that the payment of
such interest shall be legally enforceable), which shall accrue from the date of
such default in payment to the date payment of such principal has been made or
duly provided for. Interest on any overdue principal shall be payable on
demand. [Any such interest on any overdue principal that is not so paid on
demand shall bear interest at the rate of ____% per annum (to the extent that
the payment of such interest shall be legally enforceable), which shall accrue
from the date of such demand for payment to the date payment of such interest
has been made or duly provided for, and such interest shall also be payable on
demand.]]
Payment of the principal of (and premium, if any on) and
[IF APPLICABLE, INSERT -- and any such interest on] this Security will be made
at the office or agency of the Company maintained for that purpose in ________,
in such coin or currency of [the United States of America] as at the
time of payment is legal tender for payment of public and private debts [IF
APPLICABLE, INSERT --; PROVIDED, HOWEVER, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register or by
wire transfer to an account maintained by the Person entitled thereto as
specified in the Security Register, PROVIDED that such Person shall have given
the Indenture Trustee written wire instructions at least five Business Days
prior to the applicable Interest Payment Date.]
[IF THE SECURITY IS PAYABLE IN A FOREIGN CURRENCY, INSERT -- the
appropriate provision.]
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Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed
by the Indenture Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal.
PRIME GROUP REALTY TRUST
By
------------------------------------
Title:
Attest:
- ----------------------------
Title:
Section 203. FORM OF REVERSE OF SECURITY.
This Security is one of a duly authorized issue of securities of
the Company (herein called the "SECURITIES"), issued and to be issued in one or
more series under an Indenture, dated as of __________, _____ (herein, together
with all indentures supplemental thereto, called the "INDENTURE"), between the
Company and [____________________], as Indenture Trustee (herein called the
"INDENTURE TRUSTEE", which term includes any successor indenture trustee under
the Indenture). [This Security is one of a series [, limited in aggregate
principal amount to $ ] designated as [__________] (herein called
"[__________]"), [created by a supplemental indenture, dated as of _____________
(the "SUPPLEMENTAL INDENTURE"), duly executed and delivered by the Company to
such Indenture Trustee.] Reference is hereby made to the Indenture for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Indenture Trustee, the holders of Senior Debt and
the Holders of the Securities (including the Holders of the [__________]) and of
the terms upon which the Securities are, and are to be, authenticated and
delivered.
[IF APPLICABLE, INSERT -- The Securities are redeemable, as a
whole or in part, at the option of the Company, at any time or from time to
time, on at least 30 days, but not more than 60 days, prior notice mailed to the
registered address of each holder of Securities. The redemption prices will be
equal to the greater of (1) 100% of the principal amount of the Securities to be
redeemed or (2) the sum of the present values of the Remaining Scheduled
Payments (as defined
15
<PAGE>
below) discounted, on a semiannual basis (assuming a 360-day year consisting
of twelve 30-day months), at a rate equal to the sum of the applicable
Treasury Rate (as defined below) plus __ basis points, plus accrued interest
to the date of redemption.
"TREASURY RATE" means, with respect to any redemption date, the
rate per annum equal to the semiannual equivalent yield to maturity (computed as
of the second business day immediately preceding such redemption date) of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date.
"COMPARABLE TREASURY ISSUE" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of such series of Securities to be redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt securities
of comparable maturity to the remaining term of such series of Securities.
"INDEPENDENT INVESTMENT BANKER" means one of the Reference Treasury Dealers
appointed by the Company.
"COMPARABLE TREASURY PRICE" means, with respect to any redemption
date, the average of the Reference Treasury Dealer Quotations for such
redemption date. "REFERENCE TREASURY DEALER QUOTATIONS" means, with respect to
each Reference Treasury Dealer and any redemption date, the average, as
determined by the Trustee, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 3:30 p.m.,
New York City time, on the third business day preceding such redemption date.
"REFERENCE TREASURY DEALER" means each of ___________ and
__________ and their respective successors. If any of the foregoing shall cease
to be a primary U.S. Government securities dealer (a "Primary Treasury Dealer"),
the Company shall substitute another nationally recognized investment banking
firm that is a Primary Treasury Dealer.
"REMAINING SCHEDULED PAYMENTS" means, with respect to Securities
to be redeemed, the remaining scheduled payments of principal of and interest on
such Securities that would be due after the related redemption date but for such
redemption. If such redemption date is not an interest payment date with respect
to such Securities, the amount of the next succeeding scheduled interest payment
on such Securities will be reduced by the amount of interest accrued on such
Securities to such redemption date.
On and after the redemption date, interest will cease to accrue
on the Securities or any portion of the Securities called for redemption (unless
the Company defaults in the payment of the redemption price and accrued
interest). On or before the redemption date, the Company will deposit with a
paying agent (or the Indenture Trustee) money sufficient to pay the redemption
price of and accrued interest on the Securities to be redeemed on such date. If
less than all of the Securities of any series are to be redeemed, the Securities
to be redeemed shall be selected by the Indenture Trustee by such method as the
Indenture Trustee shall deem fair and appropriate.]
16
<PAGE>
[IF APPLICABLE, INSERT -- The Securities of this series are
subject to redemption upon not less than 30 nor more than 60 days' notice by
mail, such 30 or 60 days, as the case may be, to be counted from the date notice
is mailed, [IF APPLICABLE, INSERT -- (1) on _________ in any year commencing
with the year _________ and ending with the year _________ through operation of
the sinking fund for this series at a Redemption Price equal to 100% of the
principal amount, and (2)] at any time [on or after _______________, _________],
as a whole or in part, at the election of the Company, [at Redemption Prices
determined as follows:] [at the following Redemption Prices (expressed as
percentages of the principal amount): If redeemed [on or before _________%,
and if redeemed] during the 12-month period beginning _________ of the years
indicated,
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
---- ---------- ---- ----------
<S> <C> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to ______% of the principal amount,]
together in the case of any such redemption [IF APPLICABLE, INSERT -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Regular Record Dates [or Special Record Dates] referred to on the face
hereof, all as provided in the Indenture.]
[IF APPLICABLE, INSERT -- The Securities of this series are
subject to redemption upon not less than 30 nor more than 60 days' notice by
mail, such 30 or 60 days, as the case may be, to be counted from the date notice
is mailed, (1) on _________ in any year commencing with the year _________ and
ending with the year _________ through operation of the sinking fund for this
series at the Redemption Prices for redemption through operation of the sinking
fund (expressed as percentages of the principal amount) set forth in the table
below, and (2) at any time [on or after _____________], as a whole or in part,
at the election of the Company, at the Redemption Prices for redemption
otherwise than through operation of the sinking fund (expressed as percentages
of the principal amount) set forth in the table below: If redeemed during the
12-month period beginning ______________ of the years indicated,
<TABLE>
<CAPTION>
Redemption Price Redemption Price for
For Redemption Redemption Otherwise
Through Operation Than Through Operation
Year of the Sinking Fund of the Sinking Fund
---- ------------------- ----------------------
<S> <C> <C>
</TABLE>
17
<PAGE>
and thereafter at a Redemption Price equal to _________% of the principal
amount, together in the case of any such redemption (whether through operation
of the sinking fund or otherwise) with accrued interest to the Redemption Date,
but interest installments whose Stated Maturity is on or prior to such
Redemption Date will be payable to the Holders of such Securities, or one or
more Predecessor Securities, of record at the close of business on the relevant
Regular Record Dates or Special Record Dates referred to on the face hereof, all
as provided in the Indenture.]
[Notwithstanding the foregoing, the Company may not, prior to
_________ redeem any Securities of this series as contemplated by [Clause (2)
of] the preceding paragraph as a part of, or in anticipation of, any refunding
operation by the application, directly or indirectly, of moneys borrowed having
an interest cost to the Company (calculated in accordance with generally
accepted financial practice) of less than _________% per annum.]
[The sinking fund for this series provides for the redemption on
_________ in each year beginning with the year _________ and ending with the
year of _________ [not less than $_________ ("mandatory sinking fund") and not
more than] $_________ aggregate principal amount of Securities of this series.
Securities of this series acquired or redeemed by the Company otherwise than
through [mandatory] sinking fund payments may be credited against subsequent
[mandatory] sinking fund payments otherwise required to be made [in the inverse
order in which they become due].]
[IF THE SECURITIES DO NOT HAVE A SINKING FUND, THEN INSERT --
the Securities do not have the benefit of any sinking fund obligations.]
The indebtedness evidenced by this Security is, to the extent
provided in the Indenture, subordinate and subject in right of payment to the
prior payment in full of all Senior Debt, and this Security is issued subject to
the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Indenture Trustee on his behalf to
take such action as may be necessary or appropriate to effect the subordination
so provided and (c) appoints the Indenture Trustee his attorney-in-fact for any
and all such purposes.
[IF THE SECURITY IS SUBJECT TO REDEMPTION, INSERT -- In the event
of redemption of this Security in part only, a new Security or Securities of
this series and of like tenor for the unredeemed portion hereof will be issued
in the name of the Holder hereof upon the cancellation hereof.]
[IF THE SECURITY IS NOT SUBJECT TO REDEMPTION, INSERT -- The
Securities of this series are not redeemable prior to Stated Maturity.]
[IF APPLICABLE, INSERT -- The Indenture contains provisions for
defeasance at any time of [the entire indebtedness of this Security] [and/or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance with certain conditions set forth in
the Indenture.]
18
<PAGE>
[IF APPLICABLE, INSERT -- The Securities of this series are not
subject to [Section 1502 of the Indenture concerning the defeasance of the
indebtedness represented by this Security] [and/or] [Section 1503 of the
Indenture concerning covenant defeasance of this Security.]
[IF THE SECURITY IS NOT AN ORIGINAL ISSUE DISCOUNT SECURITY,
INSERT -- If an Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.]
[IF THE SECURITY IS AN ORIGINAL ISSUE DISCOUNT SECURITY, INSERT
- -- If an Event of Default with respect to Securities of this series shall occur
and be continuing, an amount of principal of the Securities of this series may
be declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to - insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and interest (in each
case to the extent that the payment of such interest shall be legally
enforceable), all of the Company's obligations in respect of the payment of the
principal of and premium and interest, if any, on the Securities of this series
shall terminate.]
[IF THE SECURITY IS AN INDEXED SECURITY, INSERT -- the
appropriate provision.]
[IF THE SECURITY IS CONVERTIBLE, INSERT -- Subject to and upon
compliance with the provisions of the Indenture, the Holder of this Security is
entitled, at its option, at any time on or after the opening of business on
__________, _____ and on or before the close of business on __________, or in
case this Security or a portion hereof is called for redemption, then in respect
of this Security or such portion hereof until and including, but (unless the
Company defaults in making the payment due upon redemption) not after, the close
of business on the Redemption Date, to convert this Security (or any portion of
the principal amount hereof which is $ __________or an integral multiple
thereof), at the principal amount hereof, or of such portion, into fully paid
and nonassessable shares (calculated as to each conversion to the nearest 1/100
of a share) of [Common Shares] [Preferred Shares] of the Company at a conversion
price equal to $_________ aggregate principal amount of Securities for each
[Common Share] [Preferred Share] (or at the current adjusted conversion price if
an adjustment has been made as provided in the Indenture) by surrender of this
Security, duly endorsed or assigned to the Company or in blank, to the Company
at its office or agency in ______________________, accompanied by a completed
and signed "Form of Election to Convert" below, which will constitute written
notice to the Company that the Holder hereof elects to convert this Security, of
if less than the entire principal amount hereof is to be converted, the portion
hereof to be converted, and, in case such surrender shall be made during the
period from the close of business on any Regular Record Date next preceding any
Interest Payment Date to the opening of business on such Interest Payment Date
(unless this Security or the portion hereof being converted has been called for
redemption on a Redemption Date within such period), also accompanied by payment
in immediately available funds or other funds acceptable to the Company of an
amount equal to the interest payable on such Interest Payment Date on the
principal amount of this Security then being converted. Subject to the aforesaid
requirement for payment and, in the case of a conversion after the Regular
Record Date next preceding any Interest Payment Date and
19
<PAGE>
on or before such Interest Payment Date, to the right of the Holder of this
Security (or any Predecessor Security) of record at such Regular Record Date
to receive an installment of interest (with certain exceptions provided in
the Indenture), no payment or adjustment is to be made on conversion for
interest accrued hereon or for dividends on the Common Shares issued on
conversion. No fractions of shares or scrip representing fractions of shares
will be issued on conversion, but instead of any fractional interest the
Company shall pay a cash adjustment as provided in the Indenture. The
conversion price is subject to adjustment as provided in the Indenture. In
addition, the Indenture provides that in case of certain consolidations or
mergers to which the Company is a party or the transfer of substantially all
of the assets of the Company, the Indenture shall be amended, without the
consent of any Holders of Securities, so that this Security, if then
outstanding, will be convertible thereafter, during the period this Security
shall be convertible as specified above, only into the kind and amount of
securities, cash and other property receivable upon the consolidation, merger
or transfer by a holder of the number of [Common Shares] [Preferred Shares]
into which this Security might have been converted immediately prior to such
consolidation, merger or transfer (assuming such holder of [Common Shares]
[Preferred Shares] failed to exercise any rights of election and received per
share the kind and amount received per share by a plurality of non-electing
shares), assuming, if such consolidation, merger or transfer is prior to
[insert date upon which the Securities first become convertible], that this
Security was convertible at the time of such consolidation, merger or
transfer at the initial conversion price specified above as adjusted from
[date of issuance], to such time pursuant to the Indenture.]
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities under
the Indenture at any time by the Company and the Indenture Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be adversely affected. The Indenture also
contains provisions permitting the Holders of specified percentages in principal
amount of the Securities of each series at the time Outstanding, on behalf of
the Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly
20
<PAGE>
executed by, the Holder hereof or his attorney duly authorized in writing,
and thereupon one or more new Securities of this series and of like tenor, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered
form without coupons in denominations of $___________ [and any integral multiple
thereof]. As provided in the Indenture and subject to certain limitations
therein set forth, Securities of this series are exchangeable for a like
aggregate principal amount of Securities of this series and of like tenor of a
different authorized denomination, as requested by the Holder surrendering the
same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
No recourse shall be had for the payment of the principal of
(or premium, if any) or the interest on this Security, or for any claim based
hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture or any indenture supplemental thereto, against any incorporator,
shareholder, officer, trustee or employee, as such, past, present or future,
of the Company or any successor entity, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise, all such liability being, by the acceptance hereof
and as part of the consideration for the issue hereof, expressly waived and
released.
Prior to due presentment of this Security for registration of
transfer, the Company, the Indenture Trustee and any agent of the Company or
the Indenture Trustee may treat the Person in whose name this Security is
registered as the owner hereof for all purposes (subject to Section 307 of
the Indenture), whether or not this Security be overdue, and neither the
Company, the Indenture Trustee nor any such agent shall be affected by notice
to the contrary.
[IF APPLICABLE, INSERT -- Interest on this Security shall be
computed on the basis of a 360-day year of twelve 30-day months.]
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture. The
Indenture and this Security shall be governed by and construed in accordance
with the laws of the State of New York without regard to the conflicts of
laws principles thereof.
ABBREVIATIONS
The following abbreviations, when used in the inscription of
the face of this Note, shall be construed as though they were written out in
full according to applicable laws or regulations:
21
<PAGE>
TEN COM - as tenants in common UNIF GIFT MIN ACT -
TEN ENT - as tenants by the ______________________ Custodian
entireties (Cust)
______________________ under
JT TEN - as joint tenants with (Minor)
right of survivorship and
not as tenants in common Uniform Gifts to
Minors Act__________________
(State)
Additional abbreviations may also be used
though not in the above list.
[IF THE SECURITY IS CONVERTIBLE, INSERT - -
FORM OF ELECTION TO CONVERT
I(we) hereby irrevocably exercise the option to convert this
Security, or the principal portion below designated, into [Common Shares]
[Preferred Shares] in accordance with the terms of the Indenture referred to
in this Security, and direct that the shares issuable and deliverable upon
conversion, together with any check in payment for fractional shares, be
issued in the name of and delivered to the undersigned registered Holder
hereof and any Security representing any unconverted principal amount hereof,
unless a different name has been indicated below. If shares and/or any
Security representing any unconverted principal amount hereof are to be
issued in the name of a Person other than the undersigned, the undersigned
will pay all transfer taxes payable with respect thereto.
Portion of this Security
to be converted (if partial
conversion, $1,000 or an
integral multiple thereof): $________
Signature: ____________________________________
(exactly as your name appears on the
face of this Security)
Name: _________________________________________
Title: ________________________________________
Address: ______________________________________
Phone No.: ____________________________________
22
<PAGE>
Date: _________________________________________
If shares and/or any Security representing any unconverted principal amount
hereof, are to be issued and registered in the name of a Person other than
the undersigned, please print the name and address, including zip code, and
social security or other taxpayer identification number of such Person below.
Name: _________________________________
Address: ______________________________
TIN/Social Security No.: ______________
Signature Guaranteed (if [Common Shares] [Preferred Shares]
to be issued to other than the registered holder(s)):
By: _______________________________
This signature shall be guaranteed
by an eligible guarantor institution
(a bank or trust company having an
office or correspondent in the United
States or a broker or dealer which is
a member of a registered securities
exchange or the National Association
of Securities Dealers, Inc.) with
membership in an approved signature
guaranty medallion program pursuant
to SEC Rule 17 Ad-15.]
ASSIGNMENT FORM
(I) or (we) assign and transfer this Security to:
_______________________________________________________________________________
(Insert assignee's social security or tax I.D. no.)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint _________________________________ agent to transfer
this Security on the Register. The agent may substitute another to act for him.
Date: ______________
Signature: ____________________________________
23
<PAGE>
(exactly as your name appears on the
face of this Security)
Name: _______________________________________
Title: ______________________________________
Address: ____________________________________
Phone No.: __________________________________
Date: _______________________________________
Signature Guaranteed:
By: _______________________________
This signature shall be guaranteed
by an eligible guarantor institution
(a bank or trust company having an
office or correspondent in the United
States or a broker or dealer which is
a member of a registered securities
exchange or the National Association
of Securities Dealers, Inc.) with
membership in an approved signature
guaranty medallion program pursuant
to SEC Rule 17 Ad-15.
24
<PAGE>
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF SECURITIES
This Certificate relates to $_____ principal amount of Securities
held in *________ book-entry or *_______ definitive form by ________________
(the "Transferor").
The Transferor*:
/ / has requested the Trustee by written order to deliver in
exchange for its beneficial interest in the Book-Entry Security held by the
Depository a Security or Securities in definitive, registered form of
authorized denominations in an aggregate principal amount equal to its
beneficial interest in such Book-Entry Security (or the portion thereof
indicated above); or
/ / has requested the Trustee by written order to exchange or
register the transfer of a Security or Securities.
In connection with such request and in respect of each such
Security, the Transferor does hereby certify and agree that Transferor is
familiar with the Indenture relating to the above captioned Securities and as
provided in Section 305 of such Indenture, the transfer of this Security does
not require registration under the Securities Act of 1933, as amended (the
"Securities Act") because:*
/ / Such Security is being acquired for the Transferor's
own account, without transfer (in satisfaction of
Section 305(b)(ii)(A) or Section 305(e)(i)(A) of the Indenture).
/ / Such Security is being transferred to a "qualified
institutional buyer" (as defined in Rule 144A under the Securities Act in
reliance on Rule 144A (in satisfaction of Section 305(b)(ii)(B) or Section
305(e)(i)(B) of the Indenture) or pursuant to an exemption from registration
in accordance with Rule 904 under the Securities Act (in satisfaction of
Section 305(b)(ii)(B) or Section 305(e)(i)(B) of the Indenture.)
/ / Such Security is being transferred in accordance with Rule 144
under the Securities Act, or pursuant to an effective registration statement
under the Securities Act (in satisfaction of Section 305(b)(ii)(B) or Section
305(e)(i)(B) of the Indenture).
/ / Such Security is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the
Securities Act, other than Rule 144A, 144 or Rule 904 under the Securities
Act, and any applicable state securities laws. An Opinion of Counsel to the
effect that such transfer does not require registration under the Securities
Act accompanies this Certificate (in satisfaction of Section 305(b)(ii)(C) or
Section 305(e)(i)(C) of the Indenture).
_______________________
[INSERT NAME OF TRANSFEROR]
25
<PAGE>
Dated: ______________ By:___________________
*Check applicable box.
Section 204. ADDITIONAL PROVISIONS REQUIRED IN BOOK-ENTRY SECURITY.
Any Book-Entry Security issued hereunder shall, in addition to
the provisions contained in SECTIONS 202 and 203 and in addition to any
legend required by the Depositary, bear a legend in substantially the
following form:
"This Security is a Book-Entry Security within the meaning of
the Indenture hereinafter referred to and is registered in the name of a
Depositary or a nominee of a Depositary. This Security is exchangeable for
Securities registered in the name of a Person other than the Depositary or
its nominee only in the limited circumstances described in the Indenture and
may not be transferred except as a whole by the Depositary to a nominee of
the Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary."
Section 205. FORM OF INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
The Indenture Trustee's certificate of authentication shall be
in substantially the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
Dated: ______________
Bankers Trust Company,
As Indenture Trustee
By ___________________________________
[Authorized Signatory]
26
<PAGE>
ARTICLE THREE
The Securities
Section 301. AMOUNT UNLIMITED; ISSUABLE IN SERIES.
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. There shall be established in or pursuant to a Board Resolution and,
subject to SECTION 303, set forth, or determined in the manner provided, in
an Officers' Certificate, or established in one or more indentures
supplemental hereto, prior to the issuance of Securities of any series,
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered under this
Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the series pursuant to SECTIONS 304, 305, 306, 906 or 1107 and
except for any Securities which, pursuant to SECTION 303, are deemed never to
have been authenticated and delivered hereunder);
(3) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of the series shall
be issuable;
(4) the Person to whom any interest on a Security of the
series shall be payable, if other than 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 for such interest;
(5) 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;
(6) 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 the Regular Record Date
for any interest payable on any Interest Payment Date;
(7) the rights, if any, to defer payments of interest on any
Securities of the series by extending the interest payment period, and the
duration of such extensions;
27
<PAGE>
(8) if other than the Corporate Trust Office of the
Indenture Trustee, the place or places where the principal of and any premium
and interest on Securities of the series shall be payable;
(9) the currency, currencies or currency units in which
payment of the principal of and any premium and interest on any Securities of
the series shall be payable if other than the currency of the United States
of America and the manner of determining the equivalent thereof in the
currency of the United States of America for purposes of the definition of
"Outstanding" in SECTION 101;
(10) the period or periods within which, the price or prices
at which, the currency or currencies (including currency units) in which and
the other terms and conditions upon which Securities of the series may be
redeemed, in whole or in part, at the option of the Company;
(11) if the principal of or any premium or interest on any
Securities of the series is to be payable, at the election of the Company or
a Holder thereof, in one or more currencies or currency units other than that
or those in which the Securities are stated to be payable, the currency,
currencies or currency units in which payment of the principal of and any
premium and interest on Securities of such series as to which such election
is made shall be payable, and the periods within which and the other terms
and conditions upon which such election is to be made;
(12) if other than the principal amount thereof, the portion
of the principal amount of Securities of the series which shall be payable
upon declaration of acceleration of the Maturity thereof pursuant to SECTION
502 or the method by which such portion shall be determined;
(13) the obligation, if any, of the Company to redeem or
purchase Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or periods (or
the methods of determination of such a 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;
(14) if the amount of payments of principal of or any premium
or interest on any Securities of the series may be determined with reference
to an index, formula or other method, the index, formula or other method by
which such amounts shall be determined;
(15) if the amount Outstanding of an Indexed Security for
purposes of the definition of "Outstanding" is to be other than the principal
face amount at original issuance, the method of determination of such amount;
(16) if either or both of SECTION 1502 or 1503 does not apply
to the Securities of any series;
(17) whether the Securities of the series shall be issued in
whole or in part in the form of one or more Book-Entry Securities and, in
such case, the Depositary with respect to such
28
<PAGE>
Book-Entry Security or Securities and the circumstances under which any
Book-Entry Security may be registered for transfer or exchange, or
authenticated and delivered, in the name of a Person other than such
Depositary or its nominee, if other than as set forth in SECTION 305;
(18) any additional, modified or different covenants or
Events of Default applicable to one or more particular series of Securities;
(19) the application, if any, of ARTICLE FOURTEEN to the
Securities of any Series; and
(20) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as permitted by
SECTION 901(5)).
All Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided
in or pursuant to the Board Resolution referred to above and (subject to
SECTION 303) set forth, or determined in the manner provided, in the
Officers' Certificate referred to above or in any such 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.
If any of the terms of the series are established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Indenture Trustee at or prior to the delivery of
the Officers' Certificate setting forth, or providing the manner for
determining, the terms of the series.
Section 302. DENOMINATIONS.
The Securities of each series shall be issuable in registered
form without coupons in such denominations as shall be specified as
contemplated by SECTION 301. In the absence of any such provisions with
respect to the Securities of any series, the Securities of such series shall
be issuable in denominations of $1,000 and any integral multiple thereof.
Section 303. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
The Securities shall be executed on behalf of the Company by
its Chairman of the Board, its Chief Executive Officer, its President, its
Chief Financial Officer or one of its Vice Presidents. The signature of any
of these officers on the Securities may be manual or facsimile.
Securities 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.
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At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any series
executed by the Company to the Indenture Trustee for authentication, together
with a Company Order for the authentication and delivery of such Securities,
and the Indenture Trustee in accordance with the Company Order shall
authenticate and deliver or make available for delivery such Securities;
PROVIDED, HOWEVER, that in the case of Securities of a series that are not to
be originally issued at one time, the Indenture Trustee shall authenticate
and deliver or make available for delivery such Securities from time to time
in accordance with such other procedures (including, without limitation, the
receipt by the Indenture Trustee of oral or electronic instructions from the
Company or its duly authorized agents, promptly confirmed in writing)
acceptable to the Indenture Trustee as may be specified by or pursuant to a
Company Order delivered to the Indenture Trustee prior to the time of the
first authentication of Securities of such series. In authenticating such
Securities, and accepting the additional responsibilities under this
Indenture in relation to such Securities, the Indenture Trustee shall be
entitled to receive, and (subject to SECTION 601) shall be fully protected in
relying upon
(i) an Opinion of Counsel stating,
(a) that the form or forms of such Securities have been
established in conformity with the provisions of this Indenture;
(b) that the terms of such Securities have been, or in the
case of Securities of a series that are not to be originally issued at one
time, will be, established in conformity with the provisions of this
Indenture, subject, in the case of Securities of a series that are not to be
originally issued at one time, to any conditions specified in such Opinion of
Counsel;
(c) that such Securities, when authenticated and delivered
by the Indenture 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 conveyance,
reorganization, moratorium and similar laws of general applicability relating
to or affecting creditors' rights and to general equity principles; PROVIDED,
that such Opinion of Counsel need express no opinion as to whether a court in
the United States would render a money judgment in currency other than that
of the United States; and
(ii) an Officer's Certificate stating that all conditions precedent
provided for in this Indenture relating to the execution, authentication and
delivery of the Securities have been complied with.
If such form or forms or terms have been so established, the Indenture
Trustee shall not be required to authenticate such Securities if the issue of
such Securities pursuant to this Indenture will affect the Indenture
Trustee's own rights, duties or immunities under the Securities and this
Indenture or otherwise in a manner which the Indenture Trustee determines
would expose it to personal liability.
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Notwithstanding the provisions of SECTION 301 and of the
preceding paragraph, if all Securities of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Officers'
Certificate otherwise required pursuant to SECTION 301 or the Company Order
and Opinion of Counsel otherwise required pursuant to such preceding
paragraph at or prior to the time of 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.
If the Company shall establish pursuant to SECTION 301 that
the Securities of a series are to be issued in whole or in part in the form
of one or more Book-Entry Securities, then the Company shall execute and the
Indenture Trustee shall, in accordance with this Section and the Company
Order with respect to such series, authenticate and deliver or make available
for delivery one or more Securities in such 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
Book-Entry Security or Securities, (ii) shall be registered in the name of
the Depositary for such Book-Entry Security or Securities or the nominee of
such Depositary, (iii) shall be delivered by the Indenture Trustee to such
Depositary or pursuant to such Depositary's instruction and (iv) shall bear
the legend set forth in SECTION 204.
Unless otherwise established pursuant to SECTION 301, each
Depositary designated pursuant to SECTION 301 for a Book-Entry Security must,
at the time of its designation and at all times while it serves as
Depositary, be a clearing agency registered under the Exchange Act and any
other applicable statute or regulation. The Indenture Trustee shall have no
responsibility to determine if the Depositary is so registered. Each
Depositary shall enter into an agreement with the Indenture Trustee governing
the respective duties and rights of such Depositary and the Indenture Trustee
with regard to Book-Entry Securities.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on
such Security a certificate of authentication substantially in the form
provided for herein executed by the Indenture Trustee by manual signature of
an authorized officer thereof, and such certificate upon any Security shall
be conclusive evidence, and the only evidence, that such Security has been
duly authenticated and delivered hereunder. 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 Indenture Trustee for cancellation as provided in SECTION
309, for all purposes of this Indenture such Security shall be deemed never
to have been authenticated and delivered hereunder and shall never be
entitled to the benefits of this Indenture.
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Section 304. TEMPORARY SECURITIES.
Pending the preparation of Definitive Securities of any
series, the Company may execute, and upon Company Order the Indenture Trustee
shall authenticate and deliver or make available for delivery, temporary
Securities which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the
tenor 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 evidenced by their
execution of such Securities.
If temporary Securities of any series are issued, the Company
will cause Definitive Securities of that series to be prepared without
unreasonable delay. After the 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 in a Place
of Payment for that series, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities of any series the
Company shall execute and the Indenture Trustee shall authenticate and
deliver or make available for delivery in exchange therefor one or more
Definitive Securities of the same series, of any authorized denominations and
of a like aggregate principal amount and tenor. 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
and tenor.
Section 305. REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE;
RESTRICTIONS ON TRANSFER.
(a) General Provisions Relating to Transfers and Exchanges.
(i) The Company shall cause to be kept at the Corporate
Trust Office of the Indenture Trustee a register (the register maintained in
such office and in any other office or agency of the Company in a Place of
Payment being herein sometimes collectively referred to as the "SECURITY
REGISTER") in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Securities and
of transfers of Securities. The Indenture Trustee is hereby appointed
"Security Registrar" for the purpose of registering Securities and transfers
and exchanges of Securities as herein provided.
To permit registrations, transfers and exchanges of
Securities, the Company shall execute and the Trustee shall authenticate
Definitive Securities and Book-Entry Securities at the Security Registrar's
request. Notwithstanding anything herein to the contrary, there shall be only
one Security Register with respect to each series of Securities.
(ii) No service charge shall be made for any registration of
transfer or 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 of transfer or exchange of
Securities, other than exchanges pursuant to SECTIONS 304, 906 or 1107 not
involving any transfer.
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(iii) Notwithstanding any other provision in this Indenture,
unless and until it is exchanged in whole or in part for Securities that are
not in the form of a Book-Entry Security, a Book-Entry Security may not be
transferred or exchanged except as a whole by the Depositary with respect to
such Book-Entry Security to a nominee of such Depositary or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary.
(iv) All Definitive Securities and Book-Entry Securities
issued upon any registration of transfer or exchange of Definitive Securities
or Book-Entry Securities shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Definitive Securities or Book-Entry Securities surrendered
upon such registration of transfer or exchange.
(v) The Company shall not be required (i) to issue, register
the transfer of or exchange Securities of any series during a period
beginning at the opening of business 15 days before the day of the mailing of
a notice of redemption of Securities of that series selected for redemption
under SECTION 1103 and ending at the close of business on the day of such
mailing, or (ii) to register the transfer of or exchange any Security so
selected for redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.
(vi) Upon surrender for registration of transfer of any
Security of any series at the office or agency of the Company in a Place of
Payment for that series, the Company shall execute, and the Indenture Trustee
shall authenticate and deliver or make available for delivery, in the name of
the designated transferee or transferees, one or more new Securities of the
same series, of any authorized denominations and of a like aggregate
principal amount and tenor.
(vii) At the option of the Holder, Securities of any series
may be exchanged for other Securities of the same series, of any authorized
denominations and of a like aggregate principal amount and tenor, upon
surrender of the Securities to be exchanged at such office or agency.
Whenever any Securities are so surrendered for exchange, the Company shall
execute, and the Indenture Trustee shall authenticate and deliver or make
available for delivery, the Securities which the Holder making the exchange
is entitled to receive.
(viii) Every Security presented or surrendered for registration
of transfer or for exchange shall (if so required by the Company, the
Security Registrar or the Indenture Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company, the Security Registrar and the Indenture Trustee duly executed by
the Holder thereof or his attorney duly authorized in writing.
(ix) Notwithstanding the foregoing, any Book-Entry Security
shall be exchangeable pursuant to this SECTION 305 for Securities registered
in the names of Persons other than the Depositary for such Security or its
nominee only if (i) such Depositary notifies the Company that it is unwilling
or unable to continue as Depositary for such Book-Entry Security or if at any
time such Depositary ceases to be a clearing agency registered under the
Exchange Act and the Company does not appoint a successor Depositary within
90 days after receipt by it of such notice or after it
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becomes aware of such cessation, (ii) the Company executes and delivers to
the Indenture Trustee a Company Order that such Book-Entry Security shall be
so exchangeable or (iii) there shall have occurred and be continuing an Event
of Default with respect to the Securities. Any Book-Entry Security that is
exchangeable pursuant to the preceding sentence shall be exchangeable for
Securities registered in such names as such Depositary shall direct.
(x) None of the Company, the Indenture Trustee, any Paying
Agent or the Security Registrar will have any responsibility or liability for
any aspect of the records relating to or payments made on account of
beneficial ownership interests in a Book-Entry Security or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
(b) Transfer and Exchange of Securities.
When Definitive Securities are presented by a Holder to the
Security Registrar with a request: (x) to register the transfer of the
Definitive Securities; or (y) to exchange such Definitive Securities for an
equal principal amount of Definitive Securities of other authorized
denominations, the Security Registrar shall register the transfer or make the
exchange as requested if its requirements for such transactions are met;
provided, however, that the Definitive Securities presented or surrendered
for register of transfer or exchange: (i) shall be duly endorsed or
accompanied by a written instruction of transfer in form satisfactory to the
Security Registrar duly executed by such Holder or by his attorney, duly
authorized in writing; and (ii) in the case of a Definitive Security that is
a Transfer Restricted Security, such request shall be accompanied by the
following additional information and documents, as applicable: (A) if such
Transfer Restricted Security is being delivered to the Security Registrar by
a Holder for registration in the name of such Holder, without transfer, a
certification to that effect from such Holder (in substantially the form of
the "Certificate to be Delivered Upon Exchange or Registration of Transfer of
Securities" set forth in SECTION 203); or (B) if such Transfer Restricted
Security is being transferred to a "qualified institutional buyer" (as
defined in Rule 144A under the Securities Act) in accordance with Rule 144A
under the Securities Act or pursuant to an exemption from registration in
accordance with Rule 144 or Rule 904 under the Securities Act or pursuant to
an effective registration statement under the Securities Act, a certification
to that effect from such Holder (in substantially the form of the
"Certificate to be Delivered Upon Exchange or Registration of Transfer of
Securities" set forth in SECTION 203) or (C) if such Transfer Restricted
Security is being transferred in reliance on another exemption from the
registration requirements of the Securities Act or the securities laws of any
other applicable jurisdiction, a certification to that effect from such
Holder (in substantially the form of the "Certificate to be Delivered Upon
Exchange or Registration of Transfer of Securities" set forth in SECTION 203)
and an Opinion of Counsel from such Holder or the transferee reasonably
acceptable to the Company and to the Security Registrar to the effect that
such transfer is in compliance with the Securities Act.
(c) Transfer of a Definitive Security for a Beneficial
Interest in a Book-Entry Security.
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A Definitive Security may not be exchanged for a beneficial
interest in a Book-Entry Security except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a Definitive
Security, duly endorsed or accompanied by appropriate instruments of
transfer, in form satisfactory to the Trustee, together with: (i) if such
Definitive Security is a Transfer Restricted Security, a certification from
the Holder thereof (in substantially the form of the "Certificate to be
Delivered Upon Exchange or Registration of Transfer of Securities" set forth
in SECTION 203) to the effect that such Definitive Security is being
transferred by such Holder to a "qualified institutional buyer" (as defined
in Rule 144A under the Securities Act) in accordance with Rule 144A under the
Securities Act; and (ii) whether or not such Definitive Security is a
Transfer Restricted Security, written instructions from the Holder thereof
directing the Trustee to make, or to direct the Security Custodian to make,
an endorsement on the Book-Entry Security to reflect an increase in the
aggregate principal amount of the Securities represented by the Book-Entry
Security, in which case the Trustee shall cancel such Definitive Security in
accordance with SECTION 309 and cause, or direct the Security Custodian to
cause, in accordance with the standing instructions and procedures existing
between the Depository and the Security Custodian, the aggregate principal
amount of Securities represented by the Book-Entry Security to be increased
accordingly. If no Book-Entry Securities are then outstanding, the Company
shall issue and, upon receipt of a Company Order in accordance with SECTION
303, the Trustee shall authenticate a new Book-Entry Security in the
appropriate principal amount.
(d) Transfer and Exchange of Book-Entry Securities.
The transfer and exchange of Book-Entry Securities or
beneficial interests therein shall be effected through the Depository, in
accordance with this Indenture and the procedures of the Depository therefor,
which shall include restrictions on transfer comparable to those set forth
herein to the extent required by the Securities Act.
(e) Transfer of a Beneficial Interest in a Book-Entry
Security for a Definitive Security.
(i) Any Person having a beneficial interest in a Book-Entry
Security may upon request exchange such beneficial interest for a Definitive
Security. Upon receipt by the Trustee of written instructions or such other
form of instructions as is customary for the Depository, from the Depository
or its nominee on behalf of any Person having a beneficial interest in a
Book-Entry Security, and, in the case of a Transfer Restricted Security, the
following additional information and documents (all of which may be submitted
by facsimile): (A) if such beneficial interest is being transferred to the
Person designated by the Depository as being the beneficial owner, a
certification to that effect from such Person (in substantially the form of
the "Certificate to be Delivered Upon Exchange or Registration of Transfer of
Securities" set forth in SECTION 203) or (B) if such beneficial interest is
being transferred to a "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) in accordance with Rule 144A under the
Securities Act or pursuant to an exemption from registration in accordance
with Rule 144 or Rule 904 under the Securities Act or pursuant to an
effective registration statement under the Securities Act, a certification to
that effect from the transferor (in substantially the form of "Certificate to
be Delivered Upon Exchange or Registration
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of Transfer of Securities" set forth in SECTION 203) or (C) if such
beneficial interest is being transferred in reliance on another exemption
from the registration requirements of the Securities Act or the securities
laws of any other applicable jurisdiction, a certification to that effect
from the transferor (in substantially the form of the "Certificate to be
Delivered Upon Exchange or Registration of Transfer of Securities" set forth
in SECTION 203) and an Opinion of Counsel from the transferee or transferor
reasonably acceptable to the Company and to the Security Registrar to the
effect that such transfer is in compliance with the Securities Act, in which
case the Trustee or the Security Custodian, at the direction of the Trustee,
shall, in accordance with the standing instructions and procedures existing
between the Depository and the Security Custodian, cause the aggregate
principal amount of Book-Entry Securities to be reduced accordingly and,
following such reduction, the Company shall execute and, upon receipt of a
Company Order in accordance with SECTION 303, the Trustee shall authenticate
and deliver to the transferee a Definitive Security in the appropriate
principal amount.
(ii) Definitive Securities issued in exchange for a
beneficial interest in a Book-Entry Security pursuant to this SECTION 305(e)
shall be registered in such names and in such authorized denominations as the
Depository, pursuant to instructions from its direct or indirect participants
or otherwise, shall instruct the Trustee. The Trustee shall deliver such
Definitive Securities to the Persons in whose names such Securities are so
registered.
(f) Restrictions on Transfer and Exchange of Book-Entry
Securities.
Notwithstanding any other provision of this Indenture (other
than the provisions set forth in subsection (g) of this SECTION 305), a
Book-Entry Security may not be transferred as a whole except 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.
(g) Authentication of Securities in Absence of Depository.
If at any time: (i) the Depository for the Securities notifies
the Company that the Depository is unwilling or unable to continue as
Depository for the Book-Entry Securities and a successor Depository for the
Book-Entry Securities is not appointed by the Company within 90 days after
delivery of such notice; or (ii) the Company, at its sole discretion,
notifies the Trustee in writing that it elects to cause the issuance of
Definitive Securities under this Indenture, then the Company shall execute,
and the Trustee shall, upon receipt of a Company Order in accordance with
SECTION 303, authenticate and deliver, Definitive Securities in an aggregate
principal amount equal to the principal amount of the Book-Entry Securities
in exchange for such Book-Entry Securities.
(h) Legends and Authentication of Securities under Specified
Circumstances.
(i) Except as permitted by the following paragraphs (iii)
and (iv), each Security certificate evidencing Book-Entry Securities and
Definitive Securities (and all Securities issued in
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exchange therefor or substitution thereof) issued other than pursuant to
Regulation S shall bear a legend in substantially the following form:
"THIS [NOTE] [DEBENTURE] HAS NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND
MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A") IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (2) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH
TRANSFER, FURNISHES TO THE TRUSTEE FOR THIS [NOTE] [DEBENTURE] A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH
LETTER CAN BE OBTAINED FROM THE TRUSTEE), (3) IN AN OFFSHORE TRANSACTION
MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE
SECURITIES ACT OR (4) PURSUANT TO AN EXEMPTION FROM THE REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) AND (B) IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES."
(ii) Except as permitted by the following paragraphs (iii)
and (iv), each Security certificate evidencing Book-Entry Securities and
Definitive Securities (and all Securities issued in exchange therefor or
substitution thereof) issued pursuant to Regulation S shall bear a legend in
substantially the following form:
"THIS [NOTE] [DEBENTURE] HAS NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND,
PRIOR TO THE EXPIRATION OF A DISTRIBUTION COMPLIANCE PERIOD (DEFINED AS 40
DAYS AFTER THE ISSUE DATE WITH RESPECT TO THE [NOTES] [DEBENTURES]), MAY NOT
BE: OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) IN AN
OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF
REGULATION S OR (2) TO A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, OR (3) TO AN INSTITUTIONAL ACCREDITED INVESTOR
THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE FOR THIS [NOTE]
[DEBENTURE] A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY
(THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), AND (B) IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES."
(iii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted Security represented by a
Book-Entry Security) pursuant to Rule 144 under the Securities Act or
pursuant to an effective registration statement under the Securities Act: (A)
in the
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case of any Transfer Restricted Security that is a Definitive Security, the
Security Registrar shall permit the Holder thereof to exchange such Transfer
Restricted Security for a Definitive Security that does not bear the legend
set forth in (i) OR (ii) above and rescind any restriction on the transfer of
such Transfer Restricted Security; and (B) in the case of any Transfer
Restricted Security represented by a Book-Entry Security, such Transfer
Restricted Security shall not be required to bear the legend set forth in (i)
or (ii) above, but shall continue to be subject to the provisions of SECTION
305(e); PROVIDED, HOWEVER, that with respect to any request for an exchange
of a Transfer Restricted Security that is represented by a Book-Entry
Security for a Definitive Security that does not bear the legend set forth in
(i) or (ii) above, which request is made in reliance upon Rule 144, the
Holder thereof shall certify in writing to the Security Registrar that such
request is being made pursuant to Rule 144 (such certification to be
substantially in the form of the "Certificate to be Delivered Upon Exchange
or Registration of Transfer of Securities" set forth in SECTION 203).
(iv) Notwithstanding the foregoing, upon consummation of the
Exchange Offer, the Company shall issue and, upon receipt of a Company Order
in accordance with SECTION 303, the Trustee shall authenticate Exchange
Securities in exchange for Offered Securities accepted for exchange in the
Exchange Offer, which Exchange Securities shall not bear the legend set forth
in (i) or (ii) above, and the Security Registrar shall rescind any
restriction on the transfer of such Securities, in each case unless the
Holder of such Offered Securities is either (A) a broker-dealer, (B) a Person
participating in the distribution of the Offered Securities or (C) a Person
who is an affiliate (as defined in Rule 144A) of the Company.
(v) The letter required to be provided pursuant to
paragraphs (i) and (ii) above shall be substantially in the form of EXHIBIT
305(h)(v) hereto.
(i) Cancellation and/or Adjustment of Book-Entry Securities.
At such time as all beneficial interests in Book-Entry
Securities have been exchanged for Definitive Securities, redeemed,
repurchased or canceled, all Book-Entry Securities shall be returned to or
retained and canceled by the Trustee in accordance with SECTION 309. At any
time prior to such cancellation, if any beneficial interest in a Book-Entry
Security is exchanged for Definitive Securities, redeemed, repurchased or
canceled, the Trustee or the Security Custodian, at the direction of the
Trustee, shall, in accordance with the standing instructions and procedures
existing between the Depository and the Security Custodian, cause the
aggregate amount of Book-Entry Securities to be reduced accordingly.
Section 306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.
If any mutilated Security is surrendered to the Indenture
Trustee, the Company shall execute and the Indenture Trustee shall
authenticate and deliver or make available for delivery in exchange therefor
a new Security of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
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If there shall be delivered to the Company and the Indenture
Trustee (i) evidence to their satisfaction of the destruction, loss or theft
of any Security 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 Indenture Trustee that such
Security has been acquired by a bona fide purchaser, the Company shall
execute and the Indenture Trustee shall authenticate and deliver, in lieu of
any such destroyed, lost or stolen Security, a new Security of the same
series and of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen
Security, other than a Security having the benefit of conversion privileges
pursuant to Article Fourteen, has become or is about to become due and
payable, the Company in its discretion may, instead of issuing a new
Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the 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 Indenture Trustee) connected
therewith.
Every new Security of any series issued pursuant to this
Section in lieu of any destroyed, lost or stolen Security shall constitute an
original additional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Security 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 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.
Section 307. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Except as otherwise provided as contemplated by SECTION 301
with respect to any series of Securities, interest on any 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 for such interest at the office or agency maintained for such
purpose pursuant to SECTION 1002; PROVIDED, HOWEVER, that at the option of
the Company, interest on Securities of any series that bear interest may be
paid (i) by check mailed to the address of the Person entitled thereto as it
shall appear on the Security Register or (ii) by wire transfer to an account
maintained by the Person entitled thereto as specified in the Security
Register; PROVIDED, that such Person shall have given the Indenture Trustee
written wire instructions at least five Business Days prior to the applicable
Interest Payment Date.
Any interest on any Security of any series which is payable,
but is not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall
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forthwith cease to be payable to the Holder on the relevant Regular Record
Date by virtue of having been such Holder, and such Defaulted Interest may be
paid by the Company, at its election in each case, as provided in Clauses (1)
or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such series (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 notify the
Indenture Trustee in writing of the amount of Defaulted Interest proposed to
be paid on each Security of such series and the date of the proposed
payment, and at the same time the Company shall deposit with the Indenture
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 Indenture Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be in immediately available funds and
held in trust for the benefit of the Persons entitled to such Defaulted
Interest as in this Clause provided. Thereupon the Indenture 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
Indenture Trustee of the notice of the proposed payment (it being understood
that the date of the proposed payment shall be delayed, as necessary, by that
numbers of days that are required to allow for the minimum number of days
(i.e., 10 days) between the Special Record Date and the date of payment, and
that the Trustee will provide the Company with prompt written notice of any
such required delay after the Trustee's receipt of the Company's notice of
the proposed payment). The Indenture 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 mailed, first-class
postage prepaid, to each Holder of Securities of such series at his address
as it appears in the Security 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 the Securities
of such series (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).
(2) The Company may make payment of any Defaulted Interest
on the Securities of any series in any other lawful manner not inconsistent
with the requirements of any securities exchange on which such Securities may
be listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Indenture Trustee of the proposed
payment pursuant to this Clause, such manner of payment shall be deemed
practicable by the Indenture Trustee.
In the case of any Security which is converted after any
Regular Record Date and on or prior to the next succeeding Interest Payment
Date (other than any Security whose Maturity is prior to such Interest
Payment Date), interest whose Stated Maturity is on such Interest Payment
Date shall be payable on such Interest Payment Date notwithstanding such
conversion, and such interest (whether or not punctually paid or duly
provided for) shall be paid to the Person in whose
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name that Security (or one or more Predecessor Securities) is registered at
the close of business on such Regular Record Date. Except as otherwise
expressly provided in the immediately preceding sentence, in the case of any
Security which is converted, interest whose Stated Maturity is after the date
of conversion of such Security shall not be payable.
Subject to the foregoing provisions of this Section, 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 308. PERSONS DEEMED OWNERS.
Prior to due presentment of a Security for registration of
transfer, the Company, the Indenture Trustee and any agent of the Company or
the Indenture Trustee may treat the Person in whose name such Security is
registered as the owner of such Security for the purpose of receiving payment
of principal of and any premium and (subject to SECTION 307) any interest on
such Security and for all other purposes whatsoever, whether or not such
Security be overdue, and neither the Company, the Indenture Trustee nor any
agent of the Company or the Indenture Trustee shall be affected by notice to
the contrary.
None of the Company, the Indenture Trustee, any Paying Agent
or the Security Registrar will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests of any Book-Entry Security or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
Section 309. CANCELLATION.
All Securities surrendered for payment, redemption,
conversion, repurchase, registration of transfer or exchange or for credit
against any sinking fund payment shall, if surrendered to any Person other
than the Indenture Trustee, be delivered to the Indenture Trustee. All
Securities so delivered and any Securities surrendered directly to the
Indenture Trustee for any such purpose shall be promptly canceled by the
Indenture Trustee and such cancellation shall be noted conspicuously on each
such Security. The Company may at any time deliver to the Indenture Trustee
for cancellation any Securities previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever, and
may deliver to the Indenture Trustee (or to any other Person for delivery to
the Indenture Trustee) for cancellation any Securities previously
authenticated hereunder which the Company has not issued and sold, and all
Securities so delivered shall be promptly canceled by the Indenture Trustee.
No Securities shall be authenticated in lieu of or in exchange for any
Securities canceled as provided in this Section, except as expressly
permitted by this Indenture. All canceled Securities held by the Indenture
Trustee shall be disposed of as directed by a Company Order or after 90 days,
if not in receipt of such Company Order, shall be disposed of in accordance
with the Indenture Trustee's customary procedures.
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Section 310. COMPUTATION OF INTEREST.
Except as otherwise specified as contemplated by SECTION 301
for Securities of any series, (i) interest on the Securities of each series
which bear interest at a fixed rate shall be computed on the basis of a
360-day year of twelve 30-day months and (ii) interest on the Securities of
each series which bear interest at a variable rate shall be computed on a
basis of the actual number of days in an interest period divided by 360.
Section 311. CUSIP NUMBERS.
The Company in issuing the Securities may use "CUSIP" numbers
(if then generally in use), and, if so, the Indenture 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
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 CUSIP
numbers. The Company will promptly notify the Indenture Trustee in writing
of any change in the CUSIP numbers.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. SATISFACTION AND DISCHARGE OF INDENTURE.
This Indenture shall upon Company Request cease to be of
further effect with respect to Securities of any series (except as to any
surviving rights of registration of transfer, substitution, exchange,
replacement and conversion of such Securities herein expressly provided for),
and the Indenture Trustee, at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture
with respect to such Securities, including, but not limited to, ARTICLE
THIRTEEN hereof, when
(1) either
(A) all such Securities theretofore authenticated and
delivered (other than (i) such Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided in SECTION 306 and
(ii) such Securities 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 1003)
have been delivered to the Indenture Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the
Indenture Trustee for cancellation
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(i) have become due and payable,
(ii) will become due and payable at their Stated
Maturity within one year,
(iii) are to be called for redemption within one year
under arrangements satisfactory to the Indenture Trustee for the giving of
notice of redemption by the Indenture Trustee in the name, and at the
expense, of the Company, or
(iv) are delivered to the Trustee for conversion in
accordance with Article Fourteen.
and the Company, in the case of (B)(i), (ii) or (iii) above, has deposited or
caused to be deposited with the Indenture Trustee as trust funds in trust for
the purpose of payment and discharge an amount in the currency or currencies
or currency unit or units in which such Securities are payable sufficient to
pay and discharge the entire indebtedness on such Securities not theretofore
delivered to the Indenture Trustee for cancellation, for principal and any
premium and interest 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 has delivered to the Indenture Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction and
discharge of this Indenture with respect to such Securities have been
complied with.
Notwithstanding the satisfaction and discharge of this
Indenture, (i) the obligations of the Company to the Indenture Trustee under
SECTION 607 and to any Authenticating Agent under SECTION 616 and, if money
shall have been deposited with the Indenture Trustee pursuant to subclause
(B) of Clause (1) of this Section, the obligations of the Indenture Trustee
under SECTION 402, ARTICLE SIX and the last paragraph of SECTION 1003 shall
survive and (ii) to the extent conversion privileges under Article Fourteen
are applicable to the Securities of a series, the rights and obligations
under such Article Fourteen with respect to such series of Securities shall
survive until the earlier of the conversion of such Securities in accordance
with their terms or payment in full of the principal amount of such
Securities in accordance with their terms or payment in full of the principal
amount of such Securities and any interest or other amounts due thereon, upon
such Securities becoming due and payable in accordance with their terms.
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Section 402. APPLICATION OF TRUST MONEY.
Subject to provisions of the last paragraph of SECTION 1003,
all money deposited with the Indenture Trustee pursuant to SECTION 401 shall
be held in trust and applied by it, in accordance with the provisions of the
Securities and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Indenture Trustee may determine, to the Persons entitled thereto, of the
principal and any premium and interest for whose payment such money has been
deposited with the Indenture Trustee.
ARTICLE FIVE
Events of Default and Remedies
Section 501. EVENTS OF DEFAULT.
"EVENT OF DEFAULT", wherever used herein with respect to
Securities of any series, means any one of the following events (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 judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body, unless it is inapplicable to a
particular series or is specifically deleted or modified in the Board
Resolution (or action taken pursuant thereto), Officers' Certificate or
supplemental indenture under which such series of Securities is issued or has
been modified in an indenture supplemental hereto):
(1) default in the payment of any interest upon any Security
of that series when it becomes due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of (or premium,
if any, on) any Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when
and as due by the terms of a Security of that series and continuance of such
default for a period of 30 days; or
(4) default in the performance, or breach, of any covenant
or warranty of the Company in this Indenture with respect to Securities of
that series (other than a covenant or warranty a default in whose performance
or whose breach is elsewhere in this Section specifically dealt with), and
continuance of such default or breach for a period of 60 days after there has
been given, by registered or certified mail, to the Company by the Indenture
Trustee or to the Company and the Indenture Trustee by the Holders of at
least 25% in principal amount of the Outstanding Securities of that series
(or, if any of the Securities of that series are Original Issue Discount
Securities or Indexed Securities, such portion of the principal amount of
such Securities as may be specified in the terms thereof) 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; or
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(5) the entry by a court having jurisdiction in the premises
of (A) a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable federal or state
bankruptcy, insolvency, reorganization or other similar law or (B) a decree
or order adjudging the Company a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under any applicable federal or
state law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of any
substantial part of its property, or ordering the winding up or liquidation
of its affairs, and the continuance of any such decree or order for relief or
any such other decree or order unstayed and in effect for a period of 90
consecutive days; or
(6) the commencement by the Company of a voluntary case or
proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to be
adjudicated a bankrupt or insolvent, or the consent by it to the entry of a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any bankruptcy
or insolvency case or proceeding against it, or the filing by it of a
petition or answer or consent seeking reorganization or relief under any
applicable federal or state law, or the consent by it to the filing of such
petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or the
making by it of an assignment for the benefit of creditors, or the admission
by it in writing of its inability to pay its debts generally as they become
due, or the taking of corporate action by the Company in furtherance of any
such action; or
(7) any other Event of Default provided with respect to
Securities of that series.
Section 502. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.
If an Event of Default (other than an Event of Default
described in clause 5 or 6 of SECTION 501) with respect to Securities of any
series at the time Outstanding occurs and is continuing, then in every such
case the Indenture Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities of that series may declare the principal
amount (or, if any of the Securities of that series are Original Issue
Discount Securities or Indexed Securities, such portion of the principal
amount of such Securities as may be specified in the terms thereof) of all of
the Securities of that series to be due and payable immediately, by a notice
in writing to the Company (and to the Indenture Trustee if given by Holders),
and upon any such declaration such principal amount (or, in the case of
Original Issue Discount Securities or Indexed Securities, such specified
amount) shall become 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 judgment or
decree for payment of the money due has been obtained by the Indenture
Trustee as hereinafter in this Article provided, the Holders of a majority in
principal amount of the Outstanding Securities of that series (or, if any of
the Securities of that series are Original Issue Discount Securities or
Indexed Securities, such portion of the principal
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amount of such Securities as may be specified in the terms thereof), by
written notice to the Company and the Indenture Trustee, may rescind and
annul such declaration and its consequences if
(1) the Company has paid or deposited with the Indenture
Trustee a sum sufficient to pay
(A) all overdue interest on all Securities of that
series,
(B) 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
(D) all sums paid or advanced by the Indenture Trustee
hereunder and the reasonable compensation, expenses, disbursements and
advances of the Indenture Trustee, its agents and counsel;
and
(2) all 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 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
If an Event of Default described in clause 5 or 6 of SECTION
501 occurs, the Outstanding Securities shall ipso facto become immediately
due and payable without need of any declaration or other act on the part of
the Indenture Trustee or any Holder.
Section 503. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY INDENTURE
TRUSTEE.
The Company covenants that if
(1) default is made in the payment of any interest on any
Security when such interest 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,
the Company will, upon demand of the Indenture Trustee, pay to it, for the
benefit of the Holders of such Securities, the whole amount then due and
payable on such Securities for principal and any
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premium and interest and, to the extent that payment of such interest shall
be legally enforceable, interest on any overdue principal and premium and on
any overdue interest, at the rate or rates prescribed therefor in such
Securities, 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
Indenture Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any
series occurs and is continuing, the Indenture 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
Indenture 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
enforce any other proper remedy.
Section 504. INDENTURE TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of any judicial proceeding relative to the Company (or
any other obligor upon the Securities), its property or its creditors, the
Indenture Trustee shall be entitled and empowered, by intervention in such
proceeding or otherwise, to take any and all actions authorized under the
Trust Indenture Act in order to have claims of the Holders and the Indenture
Trustee allowed in any such proceeding. In particular, the Indenture 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 directly to the Indenture Trustee and, in the
event that the Indenture Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Indenture Trustee any amount due it
for the reasonable compensation, expenses, disbursements and advances of the
Indenture Trustee, its agents and counsel, and any other amounts due the
Indenture Trustee under SECTION 607.
No provision of this Indenture shall be deemed to authorize
the Indenture Trustee to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof or
to authorize the Indenture Trustee to vote in respect of the claim of any
Holder in any such proceeding; PROVIDED, HOWEVER, that the Indenture Trustee
may, on behalf of the Holders, vote for the election of a trustee in
bankruptcy or similar official and may be a member of a creditors' or other
similar committee.
Section 505. INDENTURE 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 Indenture Trustee without
the possession of any of the Securities or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the
Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment shall, after provision for the payment of
the reasonable compensation, expenses,
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disbursements and advances of the Indenture Trustee, its agents and counsel,
be for the ratable benefit of the Holders of the Securities in respect of
which such judgment has been recovered.
Section 506. APPLICATION OF MONEY COLLECTED.
Any money collected by the Indenture Trustee pursuant to this
Article shall be applied in the following order, at the date or dates fixed
by the Indenture Trustee and, in case of the distribution of such money on
account of principal or any premium or interest, upon presentation of the
Securities and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Indenture
Trustee under SECTION 607;
SECOND: To holders of Senior Debt as provided for, and to the
extent required, in ARTICLE THIRTEEN;
THIRD: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due and
payable on such Securities for principal and any premium and interest,
respectively; and
FOURTH: The balance, if any, to the Company.
The Indenture Trustee may fix a record date and payment date
for any payment to holders of Securities pursuant to this SECTION 506. At
least 15 days before such record date, the Company shall mail to each holder
of Securities and the Indenture Trustee a notice that states the record date,
the payment date and amount to be paid.
Section 507. LIMITATION ON SUITS.
No Holder of any Security of any series 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) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default with respect to the
Securities of that series;
(2) the Holders of not less than 25% in principal amount of
the Outstanding Securities of that series shall have made written request to
the Indenture Trustee to institute proceedings in respect of such Event of
Default in its own name as Indenture Trustee hereunder;
(3) such Holder or Holders have offered to the Indenture
Trustee indemnity satisfactory to it against the costs, expenses and
liabilities to be incurred in compliance with such request;
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(4) the Indenture Trustee for 60 days after its receipt of
such notice, request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Indenture Trustee before or during such 60-day period by
the Holders of a majority in principal amount of the Outstanding Securities
of that series;
it being understood and intended that no one or more of such 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 Holders, or to obtain or to seek to obtain priority or preference over
any other Holders or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all Holders.
Section 508. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM
AND INTEREST.
Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of and any premium and
(subject to SECTION 307) any interest on such Security on the Stated Maturity
or Maturities expressed in such Security (or, in the case of redemption, on
the Redemption Date) and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.
Section 509. RESTORATION OF RIGHTS AND REMEDIES.
If the Indenture Trustee or any Holder 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 Indenture Trustee or to such Holder, then and in
every such case, subject to any determination in such proceeding, the
Company, the Indenture Trustee and the Holders shall be restored severally
and respectively to their former positions hereunder and thereafter all
rights and remedies of the Indenture Trustee and the Holders shall continue
as though no such proceeding had been instituted.
Section 510. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of SECTION 306 and as otherwise provided in SECTION 507, no right
or remedy herein conferred upon or reserved to the Indenture Trustee or to
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 right or remedy hereunder, or otherwise, shall not prevent
the concurrent assertion or employment of any other appropriate right or
remedy.
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Section 511. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Indenture Trustee or of any Holder
of any Securities to exercise any right or remedy accruing upon any Event of
Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy
given by this Article or by law to the Indenture Trustee or to the Holders
may be exercised from time to time, and as often as may be deemed expedient,
by the Indenture Trustee or by the Holders, as the case may be.
Section 512. CONTROL BY HOLDERS.
The Holders of a majority in principal amount of the
Outstanding Securities of any series shall have the right, after notice and
request made to the Indenture Trustee pursuant to SECTION 105 hereof, to
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, with respect to the Securities of such
series; PROVIDED, that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture,
(2) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee which is not inconsistent with such
direction, and
(3) subject to the provisions of SECTION 601, the Indenture
Trustee shall have the right to decline to follow any such direction if the
Indenture Trustee in good faith shall, by a Responsible Officer or Officers
of the Indenture Trustee, determine that the proceeding so directed would
involve the Indenture Trustee in personal liability.
Section 513. WAIVER OF PAST DEFAULTS.
The Holders of not less than a majority in principal amount of
the Outstanding Securities of any series may on behalf of the Holders of all
the Securities of such series waive any past default hereunder with respect
to such series and its consequences, except a default
(1) in the payment of the principal of or any premium or
interest on any Security of such series, or
(2) in respect of a covenant or provision hereof which under
ARTICLE NINE cannot be modified or amended 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; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
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Section 514. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Indenture Trustee for any action
taken, suffered or omitted by it as Indenture Trustee, a court may require
any party litigant in such suit to file an undertaking to pay the costs of
such suit, and may assess costs, including counsel fees and expenses, against
any such party litigant, in the manner and to the extent provided in the
Trust Indenture Act; 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, the Indenture Trustee, a Holder of Securities pursuant to SECTION
508, or the Holders of more than 10% in aggregate principal amount of the
Outstanding Securities of any series.
ARTICLE SIX
The Indenture Trustee
Section 601. CERTAIN DUTIES AND RESPONSIBILITIES.
The duties and responsibilities of the Indenture Trustee shall
be as provided by the Trust Indenture Act. Notwithstanding the foregoing, no
provision of this Indenture shall require the Indenture Trustee 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 any 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. 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 Indenture Trustee
shall be subject to the provisions of this Section.
Section 602. NOTICE OF DEFAULTS.
If a default occurs hereunder with respect to Securities of
any series, the Indenture Trustee shall, to the extent a Responsible Officer
of the Indenture Trustee has actual knowledge of such default, within 90 days
after such default becomes known to the Trustee, give the Holders of
Securities of such series notice of such default as and to the extent
provided by the Trust Indenture Act; PROVIDED, HOWEVER, that in the case of
any default of the character specified in SECTION 501(4) with respect to
Securities of such series, no such notice to Holders shall be given until at
least 30 days after the occurrence thereof. For the purpose of this Section,
the term "default" means any event which is, or after notice or lapse of time
or both would become, an Event of Default with respect to Securities of such
series.
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Section 603. CERTAIN RIGHTS OF INDENTURE TRUSTEE.
Subject to the provisions of SECTION 601:
(a) the Indenture Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document (whether in its original or facsimile
form) believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Trustees may be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this Indenture the
Indenture Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action hereunder, the
Indenture Trustee (unless other evidence be herein specifically prescribed)
may, in the absence of bad faith on its part, conclusively rely upon an
Officers' Certificate or an Opinion of Counsel;
(d) the Indenture Trustee may consult with counsel of its
selection and the written advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;
(e) the Indenture 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 Indenture Trustee security or
indemnity satisfactory to it against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or direction;
(f) the Indenture 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 Indenture Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Indenture 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;
(g) the Indenture Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents, attorneys, custodians or nominees and the Indenture Trustee
shall not be responsible for any misconduct or negligence on the part of any
agent, attorney, custodian or nominee appointed with due care by it
hereunder;
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(h) the duties of the Indenture Trustee shall be determined
solely by the express provisions of this Indenture and the Trust Indenture
Act, and the Indenture Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, and no implied
covenants or obligations shall be read into this Indenture against the
Indenture Trustee;
(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 Indenture Trustee is subject to
the provisions of this SECTION 603;
(j) the Indenture Trustee shall not be liable for interest
on any money received by it hereunder except as the Indenture Trustee may
agree in writing with the Company. Money held in trust by the Indenture
Trustee hereunder need not be segregated from other funds except to the
extent required by law; and
(k) the Indenture Trustee shall not be liable for any action
taken, suffered or omitted by it in good faith and reasonably believed by it
to be authorized or within the discretion or rights or powers conferred upon
it by this Indenture.
Section 604. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Securities, except
the Indenture Trustee's certificates of authentication, shall be taken as the
statements of the Company, and neither the Indenture Trustee nor any
Authenticating Agent assumes any responsibility for their correctness. The
Indenture Trustee makes no representations as to the validity or sufficiency
of this Indenture or of the Securities. Neither the Indenture Trustee nor
any Authenticating Agent shall be accountable for the use or application by
the Company of Securities or the proceeds thereof.
Section 605. MAY HOLD SECURITIES AND SERVE AS INDENTURE TRUSTEE UNDER OTHER
INDENTURES.
The Indenture Trustee, any Authenticating Agent, any Paying
Agent, any Security Registrar or any other agent of the Company, in its
individual or any other capacity, may become the owner or pledgee of
Securities and, subject to SECTIONS 608 and 613, may otherwise deal with the
Company with the same rights it would have if it were not Indenture Trustee,
Authenticating Agent, Paying Agent, Security Registrar or such other agent.
Subject to the provisions of SECTION 608, the Indenture
Trustee may become and act as indenture trustee under other indentures under
which other securities, or certificates of interest or participation in other
securities, of the Company are outstanding in the same manner as if it were
not Indenture Trustee.
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Section 606. MONEY HELD IN TRUST.
Money held by the Indenture Trustee in trust hereunder need
not be segregated from other funds except to the extent required by law. The
Indenture Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the
Company.
Section 607. COMPENSATION AND REIMBURSEMENT.
The Company agrees
(1) to pay to the Indenture Trustee from time to time such
reasonable compensation as shall be agreed in writing between the Company and
the Indenture Trustee for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Indenture Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Indenture Trustee in
accordance with any provision of this Indenture (including the reasonable
compensation and the expenses and disbursements of its agents and counsel),
except any such expense, disbursement or advance as may be attributable to
its negligence, willful misconduct or bad faith; and
(3) to indemnify each of the Indenture Trustee, its
officers, directors, employees and agents or any predecessor Indenture
Trustee, for, and to hold it harmless against, any and all loss, liability,
damage, claim or expense incurred without negligence or willful misconduct on
its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the 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 hereunder.
The Indenture Trustee shall have a lien prior to the
Securities upon all property and funds held by it hereunder for any amount
owing it or any predecessor Indenture Trustee pursuant to this SECTION 607,
except with respect to funds held in trust for the benefit of the Holders of
particular Securities.
Without limiting any rights available to the Indenture Trustee
under applicable law, when the Indenture Trustee incurs expenses or renders
services in connection with an Event of Default specified in SECTION 501(5)
or 501(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 satisfaction
and discharge of this Indenture and the resignation or removal of the
Indenture Trustee.
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Section 608. DISQUALIFICATION; CONFLICTING INTERESTS.
If the Indenture Trustee has or shall acquire a conflicting
interest within the meaning of the Trust Indenture Act, the Indenture Trustee
shall either eliminate such interest or resign, to the extent and in the
manner provided by, and subject to the provisions of, the Trust Indenture Act
and this Indenture. To the extent permitted by the Trust Indenture Act, the
Indenture Trustee shall not be deemed to have a conflicting interest by
virtue of being a trustee under this Indenture with respect to Securities of
more than one series.
Section 609. CORPORATE INDENTURE TRUSTEE REQUIRED; ELIGIBILITY.
There shall at all times be a Indenture Trustee hereunder
which shall be a Person that is eligible pursuant to the Trust Indenture Act
to act as such and has a combined capital and surplus of at least
$50,000,000. If such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of any federal or state
supervising or examining authority, then for the purposes of this Section,
the combined capital and surplus of such Person 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 Indenture 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 hereinafter specified in
this Article.
Section 610. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Indenture Trustee and
no appointment of a successor Indenture Trustee pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Indenture Trustee in accordance with the applicable requirements of SECTION
611.
(b) The Indenture Trustee may resign at any time with
respect to the Securities of one or more series by giving written notice
thereof to the Company. If the instrument of acceptance by a successor
Indenture Trustee required by SECTION 611 shall not have been delivered to
the Indenture Trustee within 30 days after the giving of such notice of
resignation, the resigning Indenture Trustee may petition, at the expense of
the Company, any court of competent jurisdiction for the appointment of a
successor Indenture Trustee with respect to the Securities of such series.
(c) The Indenture Trustee may be removed at any time with
respect to the Securities of any series by Act of the Holders of a majority
in principal amount of the Outstanding Securities of such series, delivered
to the Indenture Trustee and to the Company. If the instrument of acceptance
by a successor Indenture Trustee required by SECTION 611 shall not have been
delivered to the Indenture Trustee within 30 days after the giving of such
notice of removal, the Indenture Trustee being removed may petition, at the
expense of the Company, any court of competent jurisdiction for the
appointment of a successor Indenture Trustee with respect to the Securities
of such series.
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(d) If at any time:
(1) the Indenture Trustee shall fail to comply with
SECTION 608 after written request therefor by the Company or by any Holder
who has been a bona fide Holder of a Security for at least six months, or
(2) the Indenture Trustee shall cease to be eligible
under SECTION 609 and shall fail to resign after written request therefor by
the Company or by any such Holder, or
(3) the Indenture Trustee shall become incapable of
acting or shall be adjudged a bankrupt or insolvent or a receiver of the
Indenture Trustee or of its property shall be appointed or any public officer
shall take charge or control of the Indenture Trustee or of 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 Indenture Trustee and appoint a successor Indenture Trustee
with respect to all Securities, or (ii) subject to SECTION 514, 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 Indenture Trustee with respect
to all Securities and the appointment of a successor Indenture Trustee or
Indenture Trustees.
(e) If the Indenture Trustee shall resign, be removed or
become incapable of acting, or if a vacancy shall occur in the office of
Indenture Trustee 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 Indenture Trustee or Indenture Trustees with
respect to the Securities of that or those series (it being understood that
any such successor Indenture 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 Indenture Trustee with respect to the Securities of any
particular series) and shall comply with the applicable requirements of
SECTION 611. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Indenture
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 Indenture
Trustee, the successor Indenture Trustee so appointed shall, forthwith upon
its acceptance of such appointment in accordance with the applicable
requirements of SECTION 611, become the successor Indenture Trustee with
respect to the Securities of such series and to that extent supersede the
successor Indenture Trustee appointed by the Company. If no successor
Indenture Trustee with respect to the Securities of any series shall have
been so appointed by the Company or the Holders and accepted appointment in
the manner required by SECTION 611, 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 Indenture Trustee with
respect to the Securities of such series.
(f) The Company shall give notice of each resignation and
each removal of the Indenture Trustee with respect to the Securities of any
series and each appointment of a successor
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Indenture Trustee with respect to the Securities of any series to all Holders
of Securities of such series in the manner provided in SECTION 106. Each
notice shall include the name of the successor Indenture Trustee with respect
to the Securities of such series and the address of its Corporate Trust
Office.
Section 611. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor
Indenture Trustee with respect to all Securities, every such successor
Indenture Trustee so appointed shall execute, acknowledge and deliver to the
Company and to the retiring Indenture Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring
Indenture Trustee shall become effective and such successor Indenture
Trustee, without any further act, deed or conveyance, shall become vested
with all the rights, powers, trusts and duties of the retiring Indenture
Trustee; but, on the request of the Company or the successor Indenture
Trustee, such retiring Indenture Trustee shall, upon payment of all sums due
and owing to the Indenture Trustee under SECTION 607, execute and deliver an
instrument transferring to such successor Indenture Trustee all the rights,
powers and trusts of the retiring Indenture Trustee and shall duly assign,
transfer and deliver to such successor Indenture Trustee all property and
money held by such retiring Indenture Trustee hereunder.
(b) In case of the appointment hereunder of a successor
Indenture Trustee with respect to the Securities of one or more (but not all)
series, the Company, the retiring Indenture Trustee and each successor
Indenture Trustee with respect to the Securities of one or more series shall
execute and deliver an indenture supplemental hereto wherein each successor
Indenture Trustee shall accept such appointment and which (1) shall contain
such provisions as shall be necessary or desirable to transfer and confirm
to, and to vest in, each successor Indenture Trustee all the rights, powers,
trusts and duties of the retiring Indenture Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Indenture Trustee relates, (2) if the retiring Indenture 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 of the retiring Indenture Trustee with respect to
the Securities of that or those series as to which the retiring Indenture
Trustee is not retiring shall continue to be vested in the retiring Indenture
Trustee, and (3) 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 Indenture Trustee, it
being understood that nothing herein or in such supplemental indenture shall
constitute such Indenture Trustees co-trustees of the same trust and that
each such Indenture Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder administered by any
other such Indenture Trustee; and upon the execution and delivery of such
supplemental indenture the resignation or removal of the retiring Indenture
Trustee shall become effective to the extent provided therein and each such
successor Indenture Trustee, without any further act, deed or conveyance,
shall become vested with all the rights, powers, trusts and duties of the
retiring Indenture Trustee with respect to the Securities of that or those
series to which the appointment of such successor Indenture Trustee relates;
but, on request of the Company or any successor Indenture Trustee, such
retiring Indenture Trustee shall duly assign, transfer and deliver to such
successor Indenture Trustee all
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property and money held by such retiring Indenture Trustee hereunder with
respect to the Securities of that or those series to which the appointment of
such successor Indenture Trustee relates; PROVIDED, HOWEVER, that to the
extent that such property and money is not held by the Indenture Trustee in
trust for the benefit of the Holders of particular Securities, such retiring
Indenture Trustee shall transfer and deliver to such successor Indenture
Trustee such property and money upon payment of all sums due and owing to
such retiring Indenture Trustee under SECTION 607.
(c) Upon request of any such successor Indenture Trustee,
the Company shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor Indenture Trustee all
such rights, powers and trusts referred to in paragraph (a) and (b) of this
Section, as the case may be.
(d) No successor Indenture Trustee shall accept its
appointment unless at the time of such acceptance such successor Indenture
Trustee shall be qualified and eligible under this Article.
Section 612. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Indenture 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 Indenture
Trustee shall be a party, or any corporation succeeding to all or
substantially all the corporate trust business of the Indenture Trustee,
shall be the successor of the Indenture Trustee hereunder; PROVIDED, such
corporation shall be otherwise 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 Indenture Trustee then in office,
any successor by merger, conversion or consolidation to such authenticating
Indenture Trustee may adopt such authentication and deliver the Securities so
authenticated with the same effect as if such successor Indenture Trustee had
itself authenticated such Securities.
Section 613. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
If and when the Indenture Trustee shall be or become a
creditor of the Company (or any other obligor upon the Securities), the
Indenture Trustee shall be subject to the provisions of the Trust Indenture
Act regarding the collection of claims against the Company (or any such other
obligor).
Section 614. INVESTMENT OF CERTAIN PAYMENTS HELD BY THE INDENTURE TRUSTEE.
Any amounts held by the Indenture Trustee hereunder, other
than pursuant to Article Thirteen hereof, shall be invested by the Indenture
Trustee from time to time at the written direction of the Company in such
investments as may be specified by the Company and reasonably agreed to by
the Indenture Trustee from time to time; PROVIDED, that in investing trust
funds pursuant to the terms of this Section and liquidating any investments
held in trust hereunder, the Indenture Trustee
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may, to the extent permitted by law, purchase securities (including for the
purposes of this paragraph securities as to which the Indenture Trustee or a
Indenture Trustee Affiliate (as defined below) is the issuer or guarantor)
from, and sell securities to, itself or any Indenture Trustee Affiliate and
purchase securities underwritten by, or in which a market is made by, the
Indenture Trustee or a Indenture Trustee Affiliate. For the purposes hereof,
a "INDENTURE TRUSTEE AFFILIATE" shall mean an entity that directly, or
indirectly through one or more intermediaries, controls, or is controlled by,
or is under common control with, the Indenture Trustee. Any income or gain
realized as a result of any such investment shall be promptly distributed (in
no event later than the next Business Day) to the Company after any intended
amounts have been paid to the Holders entitled thereto, except after the
occurrence and during the continuance of an Event of Default. The Indenture
Trustee shall have no liability to the Company for any loss resulting from
any investment made in accordance with this Section, and shall bear no
expense in connection with any investment pursuant to this Section. Any such
investment may be sold (without regard to maturity date) by the Indenture
Trustee whenever necessary to make any distribution required by this
Indenture. Nothing herein shall require the Indenture Trustee to invest funds
held by it pursuant to the last paragraph of SECTION 1003.
Section 615. RIGHTS AND PROTECTIONS OF INDENTURE TRUSTEE THAT ALSO ACTS AS
PAYING AGENT OR SECURITY REGISTRAR
In the event that the Indenture Trustee is also acting as
Paying Agent or Security Registrar hereunder, the rights and protections
afforded to the Indenture Trustee pursuant to this Article 6 shall also be
afforded to such Paying Agent or Security Registrar.
Section 616. APPOINTMENT OF AUTHENTICATING AGENT.
The Indenture 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 Indenture Trustee to authenticate
Securities of such series issued upon original issue and upon exchange,
registration of transfer or partial redemption thereof or pursuant to SECTION
306, 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 Indenture Trustee hereunder. Wherever reference is made
in this Indenture to the authentication and delivery of Securities by the
Indenture Trustee or the Indenture Trustee's certificate of authentication,
such reference shall be deemed to include authentication and delivery on
behalf of the Indenture Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Indenture Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be a corporation organized and doing business
under the laws of the United States of America, any State thereof 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 authority. If such
Authenticating Agent publishes reports of condition at least annually,
pursuant to law or to the requirements of said 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. If at any time an Authenticating Agent shall cease to be eligible
in accordance with the provisions of this
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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 all
or substantially all the corporate agency or 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 any further act on the part of the
Indenture Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Indenture Trustee and to the Company. The
Indenture Trustee may at any time terminate the agency of an Authenticating
Agent by giving written notice thereof 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 Indenture
Trustee may appoint a successor Authenticating Agent which shall be
acceptable to the Company and shall mail written notice of such appointment
by first-class mail, postage prepaid, to all Holders of Securities of the
series with respect to which such Authenticating Agent will serve, as their
names and addresses appear in the Security Register. 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. 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 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 Indenture Trustee's certificate of
authentication, an alternative certificate of authentication in the following
form:
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This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
Dated: _________________
Bankers Trust Company,
As Indenture Trustee
By ____________________________
As Authenticating Agent
By ____________________________
Authorized Signatory
ARTICLE SEVEN
Holders' Lists and Reports by Indenture Trustee and Company
Section 701. COMPANY TO FURNISH INDENTURE TRUSTEE NAMES AND ADDRESSES OF
HOLDERS.
The Company will furnish or cause to be furnished to the
Indenture Trustee (a) semi-annually, not later than 15 days after the Regular
Record Date for interest for each series of Securities, a list, in such form
as the Indenture Trustee may reasonably require, of the names and addresses
of the Holders as of such Regular Record Date, as the case may be, and (b) at
such other times as the Indenture Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list in
similar form and content as of a date not more than 15 days prior to the time
such list is furnished. Notwithstanding the foregoing, so long as the
Trustee is the Security Registrar, no such list shall be required to be
furnished.
Section 702. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(a) The Indenture Trustee shall preserve, in as current a form
as is reasonably practicable, the names and addresses of Holders contained in
the most recent list furnished to the Indenture Trustee as provided in
SECTION 701 and the names and addresses of Holders received by the Indenture
Trustee in its capacity as Security Registrar. The Indenture Trustee may
destroy any list furnished to it as provided in SECTION 701 upon receipt of a
new list so furnished.
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(b) The rights of the Holders to communicate with other
Holders with respect to their rights under this Indenture or under the
Securities, and the corresponding rights and privileges of the Indenture
Trustee, shall be as provided by the Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Indenture Trustee that neither the
Company nor the Indenture Trustee nor any agent of either of them shall be
held accountable by reason of any disclosure of information as to names and
addresses of Holders made pursuant to the Trust Indenture Act.
Section 703. REPORTS BY INDENTURE TRUSTEE.
(a) The Indenture Trustee shall transmit to Holders such
reports concerning the Indenture Trustee and its actions under this Indenture
as may be required pursuant to the Trust Indenture Act at the times and in
the manner provided pursuant thereto. If required by Section 313(a) of the
Trust Indenture Act, the Indenture Trustee shall, within sixty days after
each [May 15] following the date of the first issuance of Securities
hereunder deliver to Holders a brief report, dated as of such [May 15], which
complies with the provisions of such Section 313(a). The Indenture Trustee
also shall comply with Sections 313(b) and 313(c) of the Trust Indenture Act.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Indenture Trustee with each stock
exchange upon which any Securities are listed, with the Commission and with
the Company. The Company promptly will notify the Indenture Trustee in
writing when any Securities are listed on any stock exchange or delisted
therefrom.
Section 704. REPORTS BY COMPANY.
The Company shall file with the Indenture Trustee and the
Commission, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant to such Act;
PROVIDED, that any such information, documents or reports required to be
filed with the Commission pursuant to Section 13 or 15(d) of the Exchange Act
shall be filed with the Indenture Trustee within 15 days after the same is so
required to be filed with the Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.
The Company shall not consolidate with or merge into any other
entity or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, unless:
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(1) the Person formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance, transfer or
lease the properties and assets of the Company substantially as an entirety
shall be a corporation, partnership or trust organized and validly existing
under the laws of the United States of America, any State thereof or the
District of Columbia and shall expressly assume, by an indenture supplemental
hereto, executed and delivered to the Indenture Trustee, in form satisfactory
to the Indenture Trustee, the due and punctual payment of the principal of
(and premium, if any) and interest on all the Securities and the performance
of every covenant and the satisfaction of every condition of this Indenture
on the part of the Company to be performed, observed or satisfied;
(2) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have occurred and be continuing; and
(3) the Company has delivered to the Indenture Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and such supplemental
indenture comply with this Article and that all conditions precedent herein
provided for relating to such transaction have been complied with.
This Section shall not apply to any merger or consolidation in
which the Company is the surviving entity.
Section 802. SUCCESSOR SUBSTITUTED.
Upon any consolidation of the Company with, or merger of the
Company into, any other Person or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety in
accordance with SECTION 801, the successor Person formed by such
consolidation or into which the Company is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this
Indenture with the same effect as if such successor Person had been named as
the Company herein, and thereafter, except in the case of a lease, the
predecessor Person shall be relieved of all obligations and covenants under
this Indenture and the Securities.
Section 803. OFFICERS' CERTIFICATE AND OPINION OF COUNSEL.
The Indenture Trustee, subject to the provisions of SECTIONS 601
and 603, shall receive an Officers' Certificate and an Opinion of Counsel as
conclusive evidence that any such consolidation, merger, conveyance, transfer
or lease, and any such assumption, complies with the provisions of this
Article before the Indenture Trustee shall execute any supplemental indenture
required pursuant to this Article.
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ARTICLE NINE
Supplemental Indentures
Section 901. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company, when
authorized by a Board Resolution, and the Indenture Trustee, at any time and
from time to time, may enter into one or more indentures supplemental hereto,
in form satisfactory to the Indenture Trustee, for any of the following
purposes:
(1) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants 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 of 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; or
(4) to add to or change any of the provisions of this
Indenture to such extent as shall be necessary to permit or facilitate the
issuance of Securities in bearer form, registrable or not registrable as to
principal, and with or without interest coupons, or to permit or facilitate
the issuance of Securities in uncertificated form or in the form of
Book-Entry Securities; or
(5) to add to, change or eliminate any of the provisions of
this Indenture in respect of one or more series of Securities; PROVIDED, that
any such addition, change or elimination (i) shall neither (A) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (B) modify the
rights of the Holder of any such Security with respect to such provision or
(ii) shall become effective only when there is no such Security Outstanding;
or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series
as permitted by SECTIONS 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Indenture 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 Indenture Trustee,
pursuant to the requirements of SECTION 611(b); or
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(9) if allowed, without penalty under applicable laws and
regulations, to permit payment in the United States (including any of the
States thereof and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction of principal,
premium, if any, or interest, if any, on Securities in bearer form or
coupons, if any; or
(10) to cure any ambiguity, to correct or supplement any
provision herein which may be defective or inconsistent with any other
provision herein or to make any other provisions with respect to matters or
questions arising under this Indenture; PROVIDED, that such action pursuant
to this clause (10), other than with respect to a defective provision, shall
not adversely affect the interests of the Holders of Securities Outstanding
of any series in any material respect.
Section 902. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series adversely
affected by such supplemental indenture (or, if any of the Securities of that
series are Original Issue Discount Securities or Indexed Securities, such
portion of the principal amount of such Securities as may be specified in the
terms thereof), by Act of said Holders delivered to the Company and the
Indenture Trustee, the Company, when authorized by a Board Resolution, and
the Indenture Trustee may enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders of Securities of such series under this
Indenture; PROVIDED, HOWEVER, that no such supplemental indenture shall,
without the consent of the Holder of each Outstanding Security affected
thereby,
(1) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or any premium
payable upon the redemption thereof, or reduce the amount of the principal of
an Original Issue Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to SECTION 502,
or change any Place of Payment where, or the coin or currency in which, any
Security or any premium or interest 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), or adversely affect any right of the Holder of any Security
to require the Company to repurchase such Security, or adversely affect the
right to convert any Security as contemplated by ARTICLE FOURTEEN or modify
the provisions of Article Thirteen or the definition of "Senior Debt" in a
manner adverse to the Holder of any Security in any material respect, or
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, 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, or
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(3) modify any of the provisions of this Section, SECTION 513
or SECTION 1007, except to increase any percentage set forth in such Sections
or to provide that certain other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each Outstanding
Security affected thereby; PROVIDED, HOWEVER, that this clause shall not be
deemed to require the consent of any Holder with respect to changes in the
references to "the Indenture Trustee" and concomitant changes in this Section
and SECTION 1007, or the deletion of this proviso, in accordance with the
requirements of SECTIONS 611(b) and 901(8).
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 shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
Section 903. EXECUTION OF SUPPLEMENTAL INDENTURES.
In executing, or accepting the additional trusts created by,
any supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Indenture, the Indenture Trustee shall
be entitled to receive, and (subject to SECTION 601) shall be fully protected
in relying upon, an Officers' Certificate and an Opinion of Counsel, each
stating that the execution of such supplemental indenture is authorized and
permitted by this Indenture and, in the case of such Opinion of Counsel, that
such supplemental indenture, when executed by the Trustee, will constitute a
valid and legally binding obligation of the Company, enforceable in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles. The Indenture Trustee may, but shall not be obligated to,
enter into any such supplemental indenture which affects the Indenture
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Section 904. 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 shall be bound thereby.
Section 905. CONFORMITY WITH TRUST INDENTURE ACT.
Every supplemental indenture executed pursuant to this Article
shall conform to the requirements of the Trust Indenture Act.
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Section 906. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and
shall if required by the Indenture Trustee, bear a notation in form approved
by the Indenture Trustee as to any matter provided for in such supplemental
indenture. If the Company shall so determine, new Securities of any series so
modified as to conform, in the opinion of the Indenture Trustee and the
Company, to any such supplemental indenture may be prepared and executed by
the Company and authenticated and delivered by the Indenture Trustee in
exchange for Outstanding Securities of such series.
ARTICLE TEN
Covenants
Section 1001. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The Company covenants and agrees for the benefit of each series
of Securities that it will duly and punctually pay the principal of (and
premium, if any) and interest on the Securities of the series in accordance
with the terms of the Securities and this Indenture.
Section 1002. MAINTENANCE OF OFFICE OR AGENCY.
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. The Indenture Trustee is hereby initially
appointed Paying Agent, and the Corporate Trust Office of the Indenture
Trustee is initially designated as the office or agency for the foregoing
purposes. The Company will give prompt written notice to the Indenture
Trustee of the location, and any change in the location, of 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 Indenture Trustee with the
address thereof, such presentations, surrenders, notices and demands may be
made or served at the Corporate Trust Office of the Indenture Trustee, and
the Company hereby appoints the Indenture Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more
other offices or agencies where the Securities 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 agency in each Place of Payment for Securities of any
series for such purposes. The Company will give prompt written notice to the
Indenture Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.
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Section 1003. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST.
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 (and premium, if any) or interest 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 (and 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 Indenture Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for
any series of Securities, it will, on or before each due date of the
principal of (and premium, if any) or interest on any Securities of that
series, deposit with a Paying Agent a sum sufficient to pay the principal
(and premium, if any) or interest so becoming due, such sum to be held in
trust for the benefit of the Persons entitled to such principal, premium or
interest, and (unless such Paying Agent is the Indenture Trustee) the Company
will promptly notify the Indenture Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of
Securities other than the Indenture Trustee to execute and deliver to the
Indenture Trustee an instrument in which such Paying Agent shall agree with
the Indenture Trustee, subject to the provisions of this Section, that such
Paying Agent will:
(1) hold all sums held by it for the payment of the
principal of (and premium, if any) or interest 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 Indenture Trustee notice of any default
by the Company (or any other obligor upon the Securities of that
series) in the making of any payment of principal (and premium,
if any) or interest on the Securities of that series; and
(3) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee,
forthwith pay to the Indenture 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 of this Indenture or for any other purpose, pay,
or by Company Order direct any Paying Agent to pay, to the Indenture Trustee
all sums held in trust by the Company or such Paying Agent, such sums to be
held by the Indenture Trustee upon the same trusts 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 Indenture Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
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Any money deposited with the Indenture Trustee or any Paying
Agent, or received by the Indenture Trustee in respect of obligations
deposited with the Indenture Trustee pursuant to ARTICLE FIFTEEN, or then
held by the Company, in trust for the payment of the principal of (and
premium, if any) or interest on any Security of any series and remaining
unclaimed for two years after such principal (and premium, if any) or
interest has become due and payable shall be paid to the Company on Company
Request (unless otherwise required by mandatory provisions of applicable
escheat or abandoned or unclaimed property law), or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, look only to the Company
for payment thereof (unless the Company has remitted required moneys or other
property to the appropriate governmental authority under any applicable
escheat or abandoned or unclaimed property laws, or has otherwise been
discharged under such laws or laws of similar applicability, in which case
such Holder shall look solely to its remedies (if any) under such laws and
not to the Company), and all liability of the Indenture 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 Indenture 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],
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.
Section 1004. PAYMENT OF TAXES AND OTHER CLAIMS.
The Company will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all taxes,
assessments and governmental charges levied or imposed upon the Company or
any Subsidiary or upon the income or profits of the Company or any
Subsidiary, and (2) all lawful claims for labor materials and supplies which,
if unpaid, might by law become a lien upon any property of the Company or any
Subsidiary; PROVIDED, HOWEVER, that the Company shall not be required to pay
or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim (a) whose amount, applicability or validity is being
contested in good faith by appropriate proceedings or (b) which is not of
material importance to the business, operations, financial condition or
results of operations of the Company and its Subsidiaries taken as a whole.
Section 1005. MAINTENANCE OF PROPERTIES.
The Company will cause all of its material properties used or
useful in the conduct of its business or the business of any Subsidiary to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all
times; PROVIDED, HOWEVER, that nothing in this Section shall prevent the
Company or any Subsidiary from selling or otherwise disposing for value its
properties in the ordinary course of its business.
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Section 1006. TRUST EXISTENCE.
Subject to Article Eight, the Company will do or cause to be
done all things necessary to preserve and keep in full force and effect its
real estate investment trust existence, rights (charter and statutory) and
franchises; PROVIDED, HOWEVER, that the Company shall not be required to
preserve any such right or franchise if the Company shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company.
Section 1007. WAIVER OF CERTAIN COVENANTS.
The Company may omit in any particular instance to comply with
any covenant or condition set forth in SECTIONS 1004 to 1006, inclusive, with
respect to the Securities of any series if before or after the time for such
compliance the Holders of at least a majority in principal amount of the
Outstanding Securities of such series shall, by Act of such Holders, either
waive such compliance in such instance or generally waive compliance with
such covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until
such waiver shall become effective, the obligations of the Company and the
duties of the Indenture Trustee in respect of any such covenant or condition
shall remain in full force and effect.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Persons entitled to waive compliance
with any covenant or condition hereunder. If a record date is fixed, the
Holders on such record date, or their duly designated proxies, and only such
Persons, shall be entitled to waive any such compliance, whether or not such
Holders remain Holders after such record date.
Section 1008. COMPLIANCE CERTIFICATE.
The Company will furnish to the Indenture Trustee on or before
[May 1] in each year (beginning the first [May 1] after the date of original
issuance of Securities hereunder) a brief certificate (which need not comply
with SECTION 102) from the principal executive, financial or accounting
officer of the Company stating that in the course of the performance by the
signer of his or her duties as an officer of the Company he or she would
normally have knowledge of any default or non-compliance by the Company in
the performance of any covenants or conditions contained in this Indenture,
stating whether or not he or she has knowledge of any such default or
non-compliance and, if so, specifying each such default or non-compliance of
which the signer has knowledge and the nature thereof. For purposes of this
SECTION 1008, non-compliance or default shall be determined without regard to
any grace period or requirement of notice provided pursuant to the terms of
this Indenture.
Section 1009. INSURANCE. The Company will, and will cause each of
its Subsidiaries to, keep all of its insurable properties insured against
loss or damage in commercially reasonable amounts with insurers of recognized
responsibility.
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ARTICLE ELEVEN
Redemption of Securities
Section 1101. APPLICABILITY OF ARTICLE.
Securities of any series which are redeemable in whole or in part
before their Stated Maturity shall be redeemable in accordance with their terms
and (except as otherwise specified as contemplated by SECTION 301 for Securities
of any series) in accordance with this Article.
Section 1102. ELECTION TO REDEEM: NOTICE TO INDENTURE TRUSTEE.
The election of the Company to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution or Officers' Certificate. In
case of any redemption at the election of the Company of the Securities 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 Indenture
Trustee), notify the Indenture Trustee in writing of such Redemption Date, 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
redemption of Securities (a) prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or elsewhere in this
Indenture or (b) pursuant to an election of the Company which is subject to a
condition specified in the terms of such Securities or elsewhere in this
Indenture, the Company shall furnish the Indenture Trustee with an Officers'
Certificate evidencing compliance with such restriction or condition.
Section 1103. SELECTION BY INDENTURE TRUSTEE OF SECURITIES TO BE
REDEEMED.
If less than all the Securities of any series are to be redeemed
(unless all of the Securities of such series and of a specified tenor are to be
redeemed or unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Indenture Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Indenture 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. If less
than all of the Securities of such series and of a specified tenor are to be
redeemed (unless such redemption affects only a single Security), the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Indenture Trustee, from the Outstanding Securities of
such series and specified tenor not previously called for redemption in
accordance with the preceding sentence.
The Indenture Trustee shall promptly notify the Company in
writing of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount thereof to be
redeemed.
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The provisions of the two preceding paragraphs shall not apply
with respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
Section 1104. NOTICE OF REDEMPTION.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall identify the Securities to be
redeemed (including CUSIP numbers) and shall state:
(1) the Redemption Date,
(2) the Redemption Price, plus accrued interest, if any,
(3) in the case of partial redemption of any Securities, the
principal amounts of the particular Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price will
become due and payable upon each such Security, or portion thereof, to be
redeemed and, if applicable, that interest thereon will cease to accrue on and
after said date,
(5) the place or places where such Securities are to be
surrendered for payment of the Redemption Price,
(6) that the redemption is for a sinking fund, if such is the
case, and
(7) that there exists a conversion privilege.
Notice of redemption of Securities to be redeemed at the election
of the Company shall be given by the Company or, at the Company's request, by
the Indenture Trustee in the name and at the expense of the Company (PROVIDED,
that the Indenture Trustee has received the notice of redemption at least 45
days prior to the Redemption Date unless a shorter period is agreed to by the
Indenture Trustee) and shall be irrevocable.
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Section 1105. DEPOSIT OF REDEMPTION PRICE.
On or prior to 11:00 a.m., New York City time, on the Redemption
Date, the Company shall deposit with the Indenture Trustee or with a Paying
Agent (or, if the Company is acting as its own Paying Agent, segregate and hold
in trust as provided in SECTION 1003) an amount of money in the currency or
currencies in which the Securities of such series are payable (except as
otherwise specified pursuant to SECTION 301 for the Securities of such series)
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Securities or
portions thereof which are to be redeemed on that date.
Section 1106. 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. Upon surrender
of any such Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price, together with
accrued interest to the Redemption Date; PROVIDED, HOWEVER, that, unless
otherwise specified as contemplated by SECTION 301, installments of interest
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 Securities,
registered as such at the close of business on the relevant Record Dates
according to their terms and the provisions of SECTION 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall, until
paid, bear interest from the Redemption Date at the rate prescribed therefor in
the Security.
Section 1107. SECURITIES REDEEMED IN PART.
Any Security which is to be redeemed only in part shall be
surrendered at a Place of Payment therefor (with, if the Company or the
Indenture Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Indenture Trustee duly
executed by, the Holder thereof or his attorney duly authorized in writing), and
the Company shall execute, and the Indenture Trustee shall authenticate and
deliver or make available for delivery to the Holder of such Security without
service charge, a new Security or Securities of the same series and of like
tenor, of any authorized denomination as requested by such Holder, in aggregate
principal amount equal to and in exchange for the unredeemed portion of the
principal of the Security so surrendered. If a Book-Entry Security is so
surrendered, such new Security so issued shall be a new Book-Entry Security.
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ARTICLE TWELVE
Sinking Funds
Section 1201. APPLICABILITY OF ARTICLE.
The provisions of this ARTICLE TWELVE shall be applicable to any
sinking fund for the retirement of Securities of a series except as otherwise
specified as contemplated by SECTION 301 for Securities of such series.
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 1202. 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 1202. SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.
The Company (1) may deliver Outstanding Securities of a series
(other than any previously called for redemption) and (2) 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 Indenture
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 1203. REDEMPTION OF SECURITIES FOR SINKING FUND.
Not less than 45 days prior to each sinking fund payment date for
any series of Securities, the Company will deliver to the Indenture 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 by delivering and crediting Securities
of that series pursuant to SECTION 1202 and stating the basis for such credit
and that such Securities have not been previously so credited and will also
deliver to the Indenture Trustee any Securities to be so delivered. Not less
than 30 days before each such sinking fund payment date the Indenture Trustee
shall select the Securities to be redeemed upon such sinking fund payment date
in the manner specified in SECTION 1103 and cause notice of the redemption
thereof to be given in the name of and at the expense of the Company in
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the manner provided in SECTION 1104. Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the manner
stated in SECTIONS 1106 and 1107.
ARTICLE THIRTEEN
Subordination of Securities
Section 1301. SECURITIES SUBORDINATE TO SENIOR DEBT.
The Company covenants and agrees, and each Holder of a Security,
by his acceptance thereof, likewise covenants and agrees, that, to the extent
and in the manner hereinafter set forth in this Article (subject to the
provisions of ARTICLE FOUR and ARTICLE FIFTEEN (to the extent ARTICLE FIFTEEN is
applicable to such Security), the payment of the principal of (and premium, if
any) and interest on each and all of the Securities (including any amounts
payable upon a purchase of the Securities) are hereby expressly made, to the
extent and in the manner set forth in this Article Thirteen, subordinate and
subject in right of payment to the prior payment in full of all Senior Debt.
Section 1302. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
In the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, or (b) any liquidation, dissolution
or other winding up of the Company, whether voluntary or involuntary and whether
or not involving insolvency or bankruptcy, or (c) any assignment for the benefit
of creditors or any other marshaling of assets and liabilities of the Company,
then and in any such event specified in (a), (b) or (c) above (each such event,
if any, herein sometimes referred to as a "PROCEEDING") the holders of Senior
Debt shall be entitled to receive payment in full of all amounts due or to
become due on or in respect of all Senior Debt, or provision shall be made for
such payment in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of Senior Debt, before the Holders of the Securities are entitled
to receive any payment or distribution of any kind or character, whether in
cash, property or securities, on account of principal of (or premium, if any) or
interest on or other obligations in respect of the Securities or on account of
any purchase or other acquisition of Securities by the Company or any Subsidiary
of the Company (all such payments, distributions, purchases and acquisitions
herein referred to, individually and collectively, as a "SECURITIES PAYMENT"),
and to that end the holders of Senior Debt shall be entitled to receive, for
application to the payment thereof, any Securities Payment which may be payable
or deliverable in respect of the Securities in any such Proceeding.
In the event that, notwithstanding the foregoing provisions of
this Section 1302, the Indenture Trustee or the Holder of any Security shall
have received any Securities Payment prohibited by the foregoing provisions of
this SECTION 1302 before all Senior Debt is paid in full or payment thereof
provided for in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of Senior Debt, and if such fact shall, at or prior to the time
of such Securities Payment, have been made known to the Indenture Trustee or, as
the case may be, such Holder, then and in such
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event such Securities Payment shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee, agent
or other Person making payment or distribution of assets of the Company for
application to the payment of all Senior Debt remaining unpaid, to the extent
necessary to pay all Senior Debt in full, after giving effect to any concurrent
payment or distribution to or for the holders of Senior Debt.
For purposes of this ARTICLE THIRTEEN only, the words "ANY
PAYMENT OR DISTRIBUTION OF ANY KIND OR CHARACTER, WHETHER IN CASH, PROPERTY OR
SECURITIES" shall not be deemed to include a 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 entity provided for by such plan of reorganization or
readjustment which securities are subordinated in right of payment to all then
outstanding Senior Debt to substantially the same extent as the Securities are
so subordinated as provided in this Article.
The consolidation of the Company with, or the merger of the
Company 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 EIGHT shall not be deemed a Proceeding for the
purposes of this Section if the Person formed by such consolidation 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 EIGHT.
Section 1303. ACCELERATION; SENIOR DEBT IN DEFAULT.
In the event that any Securities are declared due and payable
before their Stated Maturity, then in such event the holders of the Senior Debt
outstanding at the time of such Securities so become due and payable shall be
entitled to receive payment in full of all amounts due or to become due on or in
respect of all Senior Debt, or provision shall be made for such payment in cash
or cash equivalents or otherwise in a manner satisfactory to the holders of such
Senior Debt, before the Holders of the Securities are entitled to receive any
Securities Payment.
In the event and during the continuation of any default in the
payment of principal of (or premium, if any) or interest on any Senior Debt
beyond any applicable grace period with respect thereto, or in the event that
any event of default with respect to any Senior Debt shall have occurred and be
continuing permitting the holders of such Senior Debt (or a trustee on behalf of
the holders thereof) to declare such Senior Debt due and payable prior to the
date on which it would otherwise have become due and payable, unless and until
such event of default shall have been cured or waived or shall have ceased to
exist and such acceleration shall have been rescinded or annulled, or in the
event any judicial proceeding shall be pending with respect to any such default
in payment or event of default, then no Securities Payment shall be made;
PROVIDED, HOWEVER, that nothing in this paragraph shall prevent the satisfaction
of any sinking fund payment in accordance with ARTICLE
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TWELVE by delivering and crediting, pursuant to SECTION 1202, Securities which
have been acquired (upon redemption or otherwise).
In the event that, notwithstanding the foregoing, the Company
shall make any Securities Payment to the Indenture Trustee or any Holder
prohibited by the foregoing provisions of this Section, and if such fact shall,
at or prior to the time of such Securities Payment, have been made known to the
Indenture Trustee or, as the case may be, such Holder, then and in such event
such Securities Payment shall be paid over and delivered forthwith to the
Company.
The provisions of this Section shall not apply to any Securities
Payment with respect to which SECTION 1302 would be applicable.
Section 1304. PAYMENT PERMITTED IF NO DEFAULT.
Nothing contained in this Article or elsewhere in this Indenture
or in any of the Securities shall prevent (a) the Company, at any time except
during the pendency of any Proceeding referred to in SECTION 1302 or under the
conditions described in SECTION 1303, from making Securities Payments, or (b)
the application by the Indenture Trustee of any money deposited with it
hereunder to Securities Payments or the retention of such Securities Payment by
the Holders, if, at the time of such application by the Indenture Trustee, it
did not have knowledge that such Securities Payment would have been prohibited
by the provisions of this Article.
Section 1305. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT.
Subject to the payment in full of all amounts due or to become
due on or in respect of Senior Debt, or the provision for such payment in cash
or cash equivalents or otherwise in a manner satisfactory to the holders of
Senior Debt, the Holders of the Securities shall be subrogated to the rights of
the holders of such Senior Debt to receive payments and distributions of cash,
property and securities applicable to the Senior Debt until the principal of
(and premium, if any) and interest on the Securities shall be paid in full. For
purposes of such subrogation, no payments or distributions to the holders of the
Senior Debt of any cash, property or securities to which the Holders of the
Securities or the Indenture 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 Debt by Holders of the Securities or the Indenture
Trustee, shall, as among the Company, its creditors other than holders of Senior
Debt and the Holders of the Securities, be deemed to be a payment or
distribution by the Company to or on account of the Senior Debt.
Section 1306. 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 on the one hand and
the holders of Senior Debt on the other hand. Nothing contained in this Article
or elsewhere in this Indenture or in the Securities is intended to or shall (a)
impair, as among the Company, its creditors other than holders of Senior Debt
and the Holders of the Securities, the obligation of the Company, which is
absolute and unconditional (and
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which, subject to the rights under this Article of the holders of Senior Debt,
is intended to rank equally with all other general obligations of the Company),
to pay to the Holders of the Securities the principal of (and premium, if any)
and interest 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 the holders of Senior Debt; or (c) prevent the Indenture Trustee or the
Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the rights, if any,
under this Article of the holders of Senior Debt to receive cash, property and
securities otherwise payable or deliverable to the Indenture Trustee or such
Holder.
Section 1307. INDENTURE TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Security by his acceptance thereof authorizes
and directs the Indenture Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article and appoints the Indenture Trustee his attorney-in-fact for any and all
such purposes.
Section 1308. NO WAIVER OF SUBORDINATION PROVISIONS.
No right of any present or future holder of any Senior Debt 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 of any knowledge thereof any such holder may have or be
otherwise charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Debt may, at any time and from time to time,
without the consent of or notice to the Indenture Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
Senior Debt, 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
Debt, or otherwise amend or supplement in any manner Senior Debt or any
instrument evidencing the same or any agreement under which Senior Debt is
outstanding; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Debt; (iii) release any Person
liable in any manner for the collection of Senior Debt; and (iv) exercise or
refrain from exercising any rights against the Company and any other Person.
Section 1309. NOTICE TO INDENTURE TRUSTEE.
The Company shall give prompt written notice to the Indenture
Trustee of any fact known to the Company which would prohibit the making of any
payment to or by the Indenture Trustee in respect of the Securities.
Notwithstanding the provisions of this Article or any other provision of this
Indenture, the Indenture Trustee shall not be charged with knowledge of the
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existence of any facts which would prohibit the making of any payment to or by
the Indenture Trustee in respect of the Securities, unless and until the
Indenture Trustee shall have received written notice thereof from the Company or
a holder of Senior Debt or from any trustee therefor; and, prior to the receipt
of any such written notice, the Indenture Trustee, subject to the provisions of
SECTION 601, shall be entitled in all respects to assume that no such facts
exist; PROVIDED, HOWEVER, that if the Indenture Trustee shall not have received
the notice provided for in this Section at least two Business Days prior to the
date upon which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of (and premium, if
any) or interest on any Security), then, anything herein contained to the
contrary notwithstanding, the Indenture Trustee shall have full power and
authority to receive such money and to apply the same to the purpose for which
such money was received and shall not be affected by any notice to the contrary
which may be received by it within two Business Days prior to such date.
Subject to the provisions of SECTION 601, the Indenture 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 Debt (or a trustee therefor) to
establish that such notice has been given by a holder of Senior Debt (or a
trustee therefor). In the event that the Indenture Trustee determines in good
faith that further evidence is required with respect to the right of any Person
as a holder of Senior Debt to participate in any payment or distribution
pursuant to this Article, the Indenture Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Indenture Trustee as to
the amount of Senior Debt 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 Indenture Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
Section 1310. 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 Indenture Trustee, subject to the provisions of
SECTION 601, and the Holders of the Securities shall be entitled to rely upon
any order or decree entered by any court of competent 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 Indenture
Trustee or to the Holders of Securities, for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, the holders of
the Senior Debt 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 1311. INDENTURE TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT.
The Indenture Trustee shall not be deemed to owe any fiduciary
duty to the holders of Senior Debt 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 Debt shall be entitled by virtue of this Article
or otherwise.
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Section 1312. RIGHTS OF INDENTURE TRUSTEE AS HOLDER OF SENIOR DEBT;
PRESERVATION OF INDENTURE TRUSTEE'S RIGHTS.
The Indenture Trustee in its individual capacity shall be
entitled to all the rights set forth in this Article with respect to any Senior
Debt which may at any time be held by it, to the same extent as any other holder
of Senior Debt, and nothing in this Indenture shall deprive the Indenture
Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments to,
the Indenture Trustee under or pursuant to SECTION 607.
Section 1313. ARTICLE APPLICABLE TO PAYING AGENTS.
In case at any time any Paying Agent other than the Indenture
Trustee shall have been appointed by the Company and be then acting hereunder,
the term "INDENTURE 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
Indenture Trustee; PROVIDED, HOWEVER, that SECTION 1312 shall not apply to the
Company or any Affiliate of the Company if it or such Affiliate acts as Paying
Agent.
Section 1314. DEFEASANCE OF THIS ARTICLE THIRTEEN.
The subordination of the Securities provided by this ARTICLE
THIRTEEN is expressly made subject to the provisions for defeasance or covenant
defeasance in ARTICLE FIFTEEN and, anything herein to the contrary
notwithstanding, upon the effectiveness of any such defeasance or covenant
defeasance, the Securities then outstanding shall thereupon cease to be
subordinated pursuant to this ARTICLE THIRTEEN.
ARTICLE FOURTEEN
Conversion of Securities
Section 1401. APPLICABILITY OF ARTICLE.
If pursuant to SECTION 301 provision is made for the conversion
of Securities pursuant to this Article Fourteen, then the provisions of this
ARTICLE FOURTEEN, with such modifications thereto as may be specified pursuant
to SECTION 301 with respect to any Securities, shall be applicable to the
Securities of such series.
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Section 1402. CONVERSION PRIVILEGE AND CONVERSION PRICE.
Subject to and upon compliance with the provisions of this
Article, at the option of the Holder thereof, any Security or any portion of the
principal amount thereof which is $1,000 or an integral multiple of $1,000 may
be converted at the principal amount thereof, or of such portion thereof, into
fully paid and nonassessable Common Shares (calculated as to each conversion to
the nearest 1/100 of a share) of the Company, at the conversion price,
determined as hereinafter provided, in effect at the time of conversion. Such
conversion right shall commence at the opening of business on the date provided
for with respect to such Securities and expire at the close of business on the
date provided for with respect to such Securities. In case a Security or
portion thereof is called for redemption, such conversion right in respect of
the Security or portion so called shall expire at the close of business on the
Redemption Date, unless the Company defaults in making the payment due upon
redemption.
The price at which Common Shares shall be delivered upon
conversion is herein referred to as the "conversion price". The conversion
price shall be adjusted in certain instances as provided in SECTION 1405.
Section 1403. EXERCISE OF CONVERSION PRIVILEGE.
In order to exercise the conversion privilege, the Holder of any
Security to be converted shall surrender such Security, duly endorsed or
assigned to the Company or in blank, at any office or agency of the Company
maintained for that purpose pursuant to SECTION 1002, accompanied by written
notice to the Company at such office or agency that the Holder elects to convert
such Security or, if less than the entire principal amount thereof is to be
converted, the portion thereof to be converted. Securities surrendered for
conversion during the period from the close of business on any Regular Record
Date next preceding any Interest Payment Date to the opening of business on such
Interest Payment Date shall (except in the case of Securities or portions
thereof which have been called for redemption on a Redemption Date within such
period) be accompanied by payment in immediately available funds or other funds
acceptable to the Company of an amount equal to the interest payable on such
Interest Payment Date on the principal amount of Securities being surrendered
for conversion. Except as provided in the preceding sentence and subject to the
penultimate paragraph of SECTION 307, no payment or adjustment shall be made
upon any conversion on account of any interest accrued on the Securities
surrendered for conversion or on account of any dividends on the Common Shares
issued upon conversion.
Securities shall be deemed to have been converted immediately
prior to the close of business on the day of surrender of such Securities for
conversion in accordance with the foregoing provisions, and at such time the
rights of the Holders of such Securities as Holders shall cease, and the Person
or Persons entitled to receive the Common Shares issuable upon conversion shall
be treated for all purposes as the record holder or holders of such Common
Shares at such time. As promptly as practicable on or after the conversion
date, the Company shall issue and shall deliver at such office or agency a
certificate or certificates for the number of full Common Shares issuable
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upon conversion, together with payment in lieu of any fraction of a share, as
provided in SECTION 1404.
In the case of any Security which is converted in part only, upon
such conversion the Company shall execute and the Indenture Trustee shall
authenticate and deliver to the Holder thereof, at the expense of the Company, a
new Security or Securities of authorized denominations in aggregate principal
amount equal to the unconverted portion of the principal amount of such
Security.
Section 1404. FRACTIONS OF SHARES.
No fractional Common Shares shall be issued upon conversion of
Securities. If more than one Security shall be surrendered for conversion at
one time by the same Holder, the number of full shares which shall be issuable
upon conversion thereof shall be computed on the basis of the aggregate
principal amount of the Securities (or specified portions thereof) so
surrendered. Instead of any fractional Common Share which would otherwise be
issuable upon conversion of any Security or Securities (or specified portions
thereof), the Company shall pay a cash adjustment in respect of such fraction in
an amount equal to the same fraction of the market price per Common Share (as
determined by the Board of Trustees or in any manner prescribed by the Board of
Trustees) at the close of business on the day of conversion.
Section 1405. ADJUSTMENT OF CONVERSION PRICE.
(1) In case at any time after the date of the issuance of the
applicable Securities, the Company shall pay or make a dividend or other
distribution on any class of shares of beneficial interest of the Company in
Common Shares, the conversion price in effect at the opening of business on the
day following the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be reduced by multiplying such
conversion price by a fraction of which the numerator shall be the number of
Common Shares outstanding at the close of business on the date fixed for such
determination and the denominator shall be the sum of such number of shares and
the total number of shares constituting such dividend or other distribution,
such reduction to become effective immediately after the opening of business on
the day following the date fixed for such determination. For the purposes of
this paragraph (1), the number of Common Shares at any time outstanding shall
not include shares held in the treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu of fractions of Common
Shares. The Company will not pay any dividend or make any distribution on
Common Shares held in the treasury of the Company.
(2) In case at any time after the date of the issuance of the
applicable Securities, the Company shall issue rights or warrants to all holders
of its Common Shares (not being available on an equivalent basis to Holders of
the Securities upon conversion) entitling them to subscribe for or purchase
Common Shares at a price per share less than the current market price per share
(determined as provided in paragraph (8) of this Section) of the Common Shares
on the date fixed for the determination of shareholders entitled to receive such
rights or warrants (other than pursuant
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to a dividend reinvestment plan, any employee benefit plan of the Company or
any obligation of the Company existing as of the original date of issuance of
the applicable Securities), the conversion price in effect at the opening of
business on the day following the date fixed for such determination shall be
reduced by multiplying such conversion price by a fraction of which the
numerator shall be the number of Common Shares outstanding at the close of
business on the date fixed for such determination plus the number of oCmmon
Shares which the aggregate of the offering price of the total number of
Common Shares so offered for subscription or purchase would purchase at such
current market price, and the denominator shall be the number of Common
Shares outstanding at the close of business on the date fixed for such
determination plus the number of Common Shares so offered for subscription or
purchase, such reduction to become effective immediately after the opening of
business on the day following the date fixed for such determination. For the
purposes of this paragraph (2), the number of Common Shares at any time
outstanding shall not include shares held in the treasury of the Company but
shall include shares issuable in respect of scrip certificates issued in lieu
of fractions of Common Shares. The Company will not issue any rights or
warrants in respect of Common Shares held in the treasury of the Company.
(3) In case at any time after the date of the issuance of the
applicable Securities, outstanding Common Shares shall be subdivided into a
greater number of Common Shares, the conversion price in effect at the opening
of business on the day following the day upon which such subdivision becomes
effective shall be proportionately reduced, and, conversely, in case outstanding
Common Shares shall each be combined into a smaller number of Common Shares, the
conversion price in effect at the opening of business on the day following the
day upon which such combination becomes effective shall be proportionately
increased, such reduction or increase, as the case may be, to become effective
immediately after the opening of business on the day following the day upon
which such subdivision or combination becomes effective.
(4) In case at any time after the date of the issuance of the
applicable Securities, the Company shall, by dividend or otherwise, distribute
to all holders of its Common Shares evidences of its indebtedness or assets
(including securities, but excluding any rights or warrants referred to in
paragraph (2) of this Section, any dividend or distribution paid in cash out of
the retained earnings of the Company and any dividend or distribution referred
to in paragraph (1) of this Section), the conversion price shall be adjusted so
that the same shall equal the price determined by multiplying the conversion
price in effect immediately prior to the close of business on the date fixed for
the determination of shareholders entitled to receive such distribution by a
fraction of which the numerator shall be the current market price per share
(determined as provided in paragraph (8) of this Section) of the Common Shares
on the date fixed for such determination less the then fair market value (as
determined by the Board of Trustees, whose determination shall be conclusive and
described in a Board Resolution filed with the Indenture Trustee) of the portion
of the assets or evidences of indebtedness so distributed applicable to one
Common Share and the denominator shall be such current market price per share of
the Common Shares, such adjustment to become effective immediately prior to the
opening of business on the day following the date fixed for the determination of
shareholders entitled to receive such distribution.
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(5) In case at any time after the date of the issuance of the
applicable Securities, the Company shall, by dividend or otherwise, distribute
to all holders of its Common Shares cash (excluding any cash that is distributed
upon a merger or consolidation to which SECTION 1412 applies or as part of a
distribution referred to in paragraph (4) of this Section) in an aggregate
amount that, combined together with (I) the aggregate amount of any other
distributions to all holders of its Common Shares made exclusively in cash
within the 12 months preceding the date of payment of such distribution and in
respect of which no adjustment pursuant to this paragraph (5) has been made and
(II) the aggregate of any cash plus the fair market value (as determined by the
Board of Trustees, whose determination shall be conclusive and described in a
Board Resolution) of any non-cash consideration payable in respect of any tender
offer by the Company or any of its subsidiaries for all or any portion of the
Common Shares concluded within the 12 months preceding the date of payment of
such distribution and in respect of which no adjustment pursuant to paragraph
(6) of this Section has been made, exceeds 15% of the product of the current
market price per share of the Common Shares on the date for the determination of
holders of Common Shares entitled to receive such distribution times the number
of Common Shares outstanding on such date, then, and in each such case,
immediately after the close of business on such date for determination, the
conversion price shall be decreased so that the same shall equal the price
determined by multiplying the conversion price in effect immediately prior to
the close of business on the date fixed for determination of the shareholders
entitled to receive such distribution by a fraction (i) the numerator of which
shall be equal to the current market price per share (determined as provided in
paragraph (8) of this Section) of the Common Shares on the date fixed for such
determination less an amount equal to the quotient of (x) the excess of such
combined amount over such 15% and (y) the number of Common Shares outstanding on
such date for determination and (ii) the denominator of which shall be equal to
the current market price per share (determined as provided in paragraph (8) of
this Section) of the Common Shares on such date for determination.
(6) In case at any time after the date of the issuance of the
applicable Securities, a tender offer made by the Company or any Subsidiary for
all or any portion of the Common Shares shall expire and such tender offer (as
amended upon the expiration thereof) shall require the payment to shareholders
of an aggregate consideration having a fair market value (as determined by the
Board of Trustees, whose determination shall be conclusive and described in a
Board Resolution) that combined together with (I) the aggregate of the cash plus
the fair market value (as determined by the Board of Trustees, whose
determination shall be conclusive and described in a Board Resolution), as of
the expiration of such tender offer, of any non-cash consideration payable in
respect of any other tender offer, by the Company or any Subsidiary for all or
any portion of the Common Shares expiring within the 12 months preceding the
expiration of such tender offer and in respect of which no adjustment pursuant
to this paragraph (6) has been made and (II) the aggregate amount of any
distributions to all holders of the Company's Common Shares made exclusively in
cash within 12 months preceding the expiration of such tender offer and in
respect of which no adjustment pursuant to paragraph (5) of this Section has
been made, exceeds 15% of the product of the current market price per share of
the Common Shares (determined as provided in paragraph (8) of this Section) as
of the last time (the "EXPIRATION TIME") tenders could have been made pursuant
to such tender offer (as it may be amended) times the number of Common Shares
outstanding (including any tendered shares) on the Expiration Time, then, and in
each such case, immediately prior to the opening of
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business on the day after the date of the Expiration Time, the conversion
price shall be adjusted so that the same shall equal the price determined by
multiplying the conversion price immediately prior to close of business on
the date of the Expiration Time by a fraction (i) the numerator of which
shall be equal to (A) the product of (I) the current market price per share
of the Common Shares (determined as provided in paragraph (8) of this
Section) on the date of the Expiration Time and (II) the number of Common
Shares outstanding (including any tendered shares) on the Expiration Time
less (B) the amount of cash plus the fair market value (determined as
aforesaid) of the aggregate non-cash consideration payable to shareholders
based on the acceptance (up to any maximum specified in the terms of the
tender offer) of Purchased Shares, and (ii) the denominator of which shall be
equal to the product of (A) the current market price per share of the Common
Shares (determined as provided in paragraph (8) of this Section) as of the
Expiration Time and (B) the number of Common Shares outstanding (including
any tendered shares) as of the Expiration Time less the number of all shares
accepted for payment pursuant to such tender offer (the shares deemed so
accepted up to any such maximum, being referred to as the "PURCHASED SHARES").
(7) The reclassification of Common Shares into securities
including securities other than Common Shares (other than any reclassification
upon a consolidation or merger to which SECTION 1412 applies) shall be deemed to
involve (a) a distribution of such securities other than Common Shares to all
holders of Common Shares (and the effective date of such reclassification shall
be deemed to be "the date fixed for the determination of shareholders entitled
to receive such distribution" and "the date fixed for such determination" within
the meaning of paragraph (4) of this Section), and (b) a subdivision or
combination, as the case may be, of the number of Common Shares outstanding
immediately prior to such reclassification into the number of Common Shares
outstanding immediately thereafter (and the effective date of such
reclassification shall be deemed to be "the day upon which such subdivision
becomes effective" or "the day upon which such combination becomes effective",
as the case may be, and "the day upon which such subdivision or combination
becomes effective" within the meaning of paragraph (3) of this Section).
(8) For the purpose of any computation under paragraphs (2),
(4), (5) and (6) of this Section, the current market price per Common Share on
any date shall be deemed to be the average of the daily closing prices for the
five consecutive Trading Days selected by the Company commencing not more than
20 Trading Days before, and ending not later than the earlier of the day in
question and the day before the "ex date" with respect to the issuance or
distribution requiring such computation. The closing price for each day shall
be the last reported sales price regular way or, in case no such reported sale
takes place on such day, the average of the reported closing bid and asked
prices regular way, in either case on the New York Stock Exchange or, if the
Common Shares are not listed or admitted to trading on such Exchange, on the
principal national securities exchange on which the Common Shares are listed or
admitted to trading or, if not listed or admitted to trading on any national
securities exchange, on the National Association of Securities Dealers Automated
Quotations National Market System or, if the Common Shares are not listed or
admitted to trading on any national securities exchange or quoted on such
National Market System, the average of the closing bid and asked prices in the
over-the-counter market as furnished by any New York Stock Exchange member firm
selected from time to time by the Company for that purpose. For purposes of this
paragraph, the term "'ex date", when used with respect to any issuance or
distribution, means
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the first date on which the Common Shares trade regular way on such exchange
or in such market without the right to receive such issuance or distribution.
(9) No adjustment in the conversion price shall be required
unless such adjustment (plus any adjustments not previously made by reason of
this paragraph (9)) would require an increase or decrease of at least 1% in such
price; PROVIDED, HOWEVER, that any adjustments which by reason of this paragraph
(9) are not required to be made shall be carried forward and taken into account
in any subsequent adjustment. All calculations under this paragraph (9) shall
be made by the Company and shall be made to the nearest cent or to the nearest
1/100 of a share, as the case may be.
(10) The Company may make such reductions in the conversion
price, in addition to those required by this Section, as it considers to be
advisable in order to avoid or diminish any income tax to any holders of Common
Shares resulting from any dividend or distribution of shares of beneficial
interest or issuance of rights or warrants to purchase or subscribe for shares
of beneficial interest or from any event treated as such for income tax purposes
or for any other reasons. The Company shall have the power to resolve any
ambiguity or correct any error in this paragraph (10) and its actions in so
doing shall be final and conclusive.
Section 1406. NOTICE OF ADJUSTMENTS OF CONVERSION PRICE.
Whenever the conversion price is adjusted as herein provided:
(a) the Company shall compute the adjusted conversion price in
accordance with SECTION 1405 and shall prepare a certificate signed by the
Treasurer of the Company setting forth the adjusted conversion price and showing
in reasonable detail the facts upon which such adjustment is based, and such
certificate shall forthwith be filed at each office or agency maintained for the
purpose of conversion of Securities pursuant to SECTION 1002; and
(b) a notice stating that the conversion price has been
adjusted and setting forth the adjusted conversion price shall forthwith be
required, and as soon as practicable after it is required, such notice shall be
mailed by the Company to all Holders at their last addresses as they shall
appear in the Security Register. Failure to deliver such notice shall not
affect the legality or validity of any such conversion price adjustment.
Section 1407. NOTICE OF CERTAIN CORPORATE ACTION.
In case at any time after the date 20 days prior to the date on
which the Securities first become convertible:
(a) the Company shall declare a dividend (or any other
distribution) on its Common Shares payable otherwise than in cash out of its
retained earnings; or
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(b) the Company shall authorize the granting to the holders of
its Common Shares of rights or warrants to subscribe for or purchase any shares
of beneficial interest of any class or of any other rights; or
(c) of any reclassification of the Common Shares of the
Company (other than a subdivision or combination of its outstanding Common
Shares), or of any consolidation or merger to which the Company is a party and
for which approval of any shareholders of the Company is required, or of the
sale or transfer of all or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation
or winding up of the Company;
then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Securities pursuant to SECTION 1002, and shall
cause to be mailed to all Holders at their last addresses as they shall appear
in the Security Register, at least 20 days (or 10 days in any case specified in
clause (a) or (b) above) prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a record is to be
taken for the purpose of such dividend, distribution, rights or warrants, or, if
a record is not to be taken, the date as of which the holders of Common Shares
of record to be entitled to such dividend, distribution, authorization of rights
or warrants are to be determined, or (y) the date on which such
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding up is expected to become effective, and the date as of
which it is expected that holders of Common Shares of record shall be entitled
to exchange their Common Shares for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up. Neither the failure to give such notice
nor any defect therein shall affect the legality or validity of the proceedings
described in clauses (a) through (d) of this SECTION 1407. If at the time the
Indenture Trustee shall not be the conversion agent, a copy of such notice shall
also forthwith be filed by the Company with the Indenture Trustee.
Section 1408. COMPANY TO RESERVE COMMON SHARES.
The Company shall at all times reserve and keep available, free
from pre-emptive rights, out of its authorized but unissued Common Shares, for
the purpose of effecting the conversion of Securities, the full number of Common
Shares then issuable upon the conversion of all outstanding Securities.
Section 1409. TAXES ON CONVERSIONS.
The Company will pay any and all taxes that may be payable in
respect of the issue or delivery of Common Shares on conversion of Securities
pursuant hereto. The Company shall not, however, be required to pay any tax
which may be payable in respect of any transfer involved in the issue and
delivery of Common Shares in a name other than that of the Holder of the
Security or Securities to be converted, and no such issue or delivery shall be
made unless and until the Person
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requesting such issue has paid to the Company the amount of any such tax, or
has established to the satisfaction of the Company that such tax has been
paid.
Section 1410. COVENANT AS TO COMMON SHARES.
The Company covenants that all Common Shares which may be issued
upon conversion of Securities will upon issue be fully paid and nonassessable
and, except as provided in SECTION 1409, the Company will pay all taxes, liens
and charges with respect to the issue thereof.
Section 1411. CANCELLATION OF CONVERTED SECURITIES.
All Securities delivered for conversion shall be delivered to the
Indenture Trustee to be canceled by or at the direction of the Indenture
Trustee, which shall dispose of the same as provided in SECTION 309.
Section 1412. PROVISIONS IN CASE OF CONSOLIDATION, MERGER OR SALE OF ASSETS.
In case of any consolidation of the Company with, or merger of
the Company into, any other Person, any merger of another Person into the
Company (other than a merger which does not result in any reclassification,
conversion, exchange or cancellation of outstanding Common Shares of the
Company) or any sale or transfer of all or substantially all of the assets of
the Company, the Person formed by such consolidation or resulting from such
merger or which acquires such assets, as the case may be, shall execute and
deliver to the Indenture Trustee a supplemental indenture providing that the
Holder of each Security then outstanding shall have the right thereafter, during
the period such Security shall be convertible as specified in SECTION 1402, to
convert such Security only into the kind and amount of securities, cash and
other property receivable upon such consolidation, merger, sale or transfer by a
holder of the number of Common Shares of the Company into which such Security
might have been converted immediately prior to such consolidation, merger, sale
or transfer, assuming such holder of Common Shares of the Company (i) is not a
Person with which the Company consolidated or into which the Company merged or
which merged into the Company or to which such sale or transfer was made, as the
case may be ("CONSTITUENT PERSON"), or an Affiliate of a constituent Person and
(ii) failed to exercise his rights of election, if any, as to the kind or amount
of securities, cash and other property receivable upon such consolidation,
merger, sale or transfer (PROVIDED, that if the kind or amount of securities,
cash and other property receivable upon such consolidation, merger, sale or
transfer is not the same for each Common Share of the Company held immediately
prior to such consolidation, merger, sale or transfer by other than a
constituent Person or an Affiliate thereof and in respect of which such rights
of election shall not have been exercised ("NON-ELECTING SHARE"), then for the
purpose of this SECTION 1412 the kind and amount of securities, cash and other
property receivable upon such consolidation, merger, sale or transfer by each
non-electing share shall be deemed to be the kind and amount so receivable per
share by a plurality of the non-electing shares), and assuming, if such
consolidation, merger, sale or transfer is prior to the date upon which the
Securities first become convertible, that the Securities were convertible at the
time of such consolidation, merger, sale or transfer at the initial conversion
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price specified in SECTION 1402 as adjusted from the date of the issuance of the
applicable Securities to such time pursuant to SECTION 1405. Such supplemental
indenture shall provide for adjustments which, for events subsequent to the
effective date of such supplemental indenture, shall be as nearly equivalent as
may be practicable to the adjustments provided for in this ARTICLE FOURTEEN. The
above provisions of this Section shall similarly apply to successive
consolidations, mergers, sales or transfers.
ARTICLE FIFTEEN
Defeasance and Covenant Defeasance
Section 1501. APPLICABILITY OF ARTICLE; COMPANY'S OPTION TO EFFECT DEFEASANCE
OR COVENANT DEFEASANCE.
Unless, pursuant to SECTION 301, provision is made that either or
both of (a) defeasance of the Securities of a series under SECTION 1502 or (b)
covenant defeasance of the Securities of a series under SECTION 1503 shall not
apply to the Securities of a series, then the provisions of such Section or
Sections, as the case may be, together with the other provisions of this ARTICLE
FIFTEEN, with such modifications thereto as may be specified pursuant to SECTION
301 with respect to any Securities, shall be applicable to the Securities of
such series, and the Company may at its option by Board Resolution, at any time,
with respect to the Securities of such series, elect to have either SECTION 1502
(if applicable) or SECTION 1503 (if applicable) applied to the Outstanding
Securities of such series upon compliance with the conditions set forth below in
this ARTICLE FIFTEEN.
Section 1502. DEFEASANCE AND DISCHARGE.
Upon the Company's exercise of its option (if applicable) to
have this SECTION 1502 applied to any series of Securities, the Company shall
be deemed to have been discharged from its obligations with respect to the
Outstanding Securities of such series, and the provisions of ARTICLE THIRTEEN
shall cease to be effective, on and after the date the conditions precedent
set forth below are satisfied (hereinafter, "DEFEASANCE"). For this purpose,
such defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by the Outstanding Securities
of such series which shall thereafter be deemed to be "Outstanding" only for
the purposes of the Sections of this Indenture referred to in clauses (A) and
(B) of this SECTION 1502, and to have satisfied all its other obligations
under such Securities and this Indenture insofar as such Securities are
concerned (and the Indenture Trustee, at the expense of the Company, shall
execute proper instruments acknowledging the same), except for the following
which shall survive until otherwise terminated or discharged hereunder: (A)
the rights of Holders of Outstanding Securities of such series to receive,
solely from the trust fund described in SECTION 1504 as more fully set forth
in such Section, payments of the principal of (and premium, if any) and
interest on such Securities when such payments are due, (B) the Company's
obligations with respect to such Securities under SECTIONS 305, 306, 1002 and
1003 and such obligations as shall be ancillary thereto, (C) the rights,
powers, trusts, duties, immunities and other provisions in respect of the
Indenture Trustee hereunder and (D)
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this ARTICLE FIFTEEN. Subject to compliance with this ARTICLE FIFTEEN, the
Company may exercise its option under this SECTION 1502 notwithstanding the
prior exercise of its option under SECTION 1503 with respect to the
Securities of such series. Following a defeasance, payment of such Securities
may not be accelerated because of an Event of Default.
Section 1503. COVENANT DEFEASANCE.
Upon the Company's exercise of its option (if applicable) to have
this SECTION 1503 applied to any series of Securities, the Company shall be
released from its obligations under SECTION 801 (and any covenant made
applicable to such Securities pursuant to SECTION 301), the occurrence of an
event specified in SECTION 501(4) (with respect to SECTION 801 or any such
covenant) (and any other Event of Default applicable to such Securities that are
determined pursuant to SECTION 301 to be subject to this provision) shall not be
deemed to be an Event of Default with respect to the Outstanding Securities of
such series and the provisions of ARTICLE THIRTEEN shall cease to be effective
on and after the date the conditions set forth below are satisfied (hereinafter,
"COVENANT DEFEASANCE"), and such Securities shall thereafter be deemed not to be
"Outstanding" for the purposes of any direction, waiver, consent or declaration
or Act of Holders (and the consequences of any thereof) in connection with
SECTION 801 (and any other covenant made applicable to such Security pursuant to
SECTION 301 and any such Events of Default), but shall continue to be deemed
"Outstanding" for all other purposes hereunder. For this purpose, such covenant
defeasance means that, with respect to the Outstanding Securities of such
series, 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 reason of any
reference in any such Section or such other covenant to any other provision
herein or in any other document, but the remainder of this Indenture and such
Securities shall be unaffected thereby. Notwithstanding the defeasance by the
Company of its obligations under SECTION 801, any successor shall be required to
assume the Company's obligations under SECTION 607 as a condition to such
succession.
Section 1504. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE.
The following shall be the conditions precedent to application of
either SECTION 1502 or SECTION 1503 to the Outstanding Securities of or within
such series:
(1) The Company shall irrevocably have deposited or caused to
be deposited with the Indenture Trustee (or another indenture trustee satisfying
the requirements of SECTION 609 who shall agree to comply with the provisions of
this ARTICLE FIFTEEN applicable to it) as trust funds in trust for the purpose
of making the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such Securities, (A) money in
an amount (in such currency, currencies or currency units in which such
Securities are then specified as payable at Maturity), or (B) U.S. Government
Obligations which through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide, not later than one
day before the due date of any payment, 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 public
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accountants expressed in a written certification thereof delivered to the
Indenture Trustee, to pay and discharge, and which shall be applied by the
Indenture Trustee (or other qualifying indenture trustee) to pay and
discharge, (i) the principal of (and premium, if any) and interest on the
Outstanding Securities of such series upon the Maturity of such principal,
premium, if any, or interest and (ii) 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.
Before such a deposit the Company may make arrangements satisfactory to the
Indenture Trustee for the redemption of Securities at a future date or dates
in accordance with ARTICLE ELEVEN, which shall be given effect in applying
the foregoing. For this purpose, "U.S. GOVERNMENT OBLIGATIONS" means
securities that are (x) direct obligations of the United States of America
for the payment of which its full faith and credit is pledged or (y)
obligations of a Person controlled or supervised by and acting as an agency
or instrumentality of the United States of America the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the
United States of America, which, in either case, are not callable or
redeemable at the option of the issuer thereof, and shall also include a
depositary receipt issued by a bank (as defined in Section 3(a)(2) of the
Securities Act) as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of the holder of
such depositary 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 depositary receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific
payment of principal of or interest on the U.S. Government Obligation
evidenced by such depositary receipt.
(2) No Event of Default or event which with notice or lapse of
time or both would become an Event of Default with respect to the Securities of
such series shall have occurred and be continuing (A) on the date of such
deposit or (B) insofar as SECTIONS 501(5) and 501(6) are concerned, at any time
during the period ending on the 91st day after the date of such deposit or, if
longer, ending on the day following the expiration of the longest preference
period applicable to the Company in respect of such deposit (it being understood
that this condition shall not be deemed satisfied until the expiration of such
period).
(3) Such defeasance or covenant defeasance shall not (A) cause
the Indenture Trustee for the Securities of such series to have a conflicting
interest as defined in SECTION 608 or for purposes of the Trust Indenture Act
with respect to any Securities of the Company or (B) result in the trust arising
from such deposit to constitute, unless it is qualified as, a regulated
investment company under the Investment Company Act of 1940, as amended.
(4) Such defeasance or covenant defeasance shall not result in
a breach or violation of, or constitute a default under, this Indenture or any
other material agreement or material instrument to which the Company is a party
or by which it is bound.
(5) In the case of an election under SECTION 1502, the Company
shall have delivered to the Indenture Trustee an Opinion of Counsel stating that
(x) the Company has received from, or there has been published by, the Internal
Revenue Service a ruling, or (y) since the date of
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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 the Outstanding Securities of such series 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 amounts, in the same manner and at the same times as would have been the
case if such defeasance had not occurred.
(6) In the case of an election under SECTION 1503, the Company
shall have delivered to the Indenture Trustee an Opinion of Counsel to the
effect that the Holders of the Outstanding Securities of such series 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.
(7) Such defeasance or covenant defeasance shall be effected
in compliance with any additional terms, conditions or limitations which may be
imposed on the Company in connection therewith pursuant to SECTION 301.
(8) The Company shall have delivered to the Indenture Trustee
an Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the defeasance under
SECTION 1502 or the covenant defeasance under SECTION 1503 (as the case may be)
have been complied with.
Section 1505. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to the provisions of the last paragraph of SECTION 1003,
all money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Indenture Trustee or other qualifying indenture trustee
(collectively, for purposes of this SECTION 1505, the "INDENTURE TRUSTEE")
pursuant to SECTION 1504 in respect of the Outstanding Securities of such series
shall be held in trust and applied by the Indenture Trustee, in accordance with
the provisions of such Securities and this Indenture, to the payment, either
directly or through any Paying Agent (but not including the Company acting as
its own Paying Agent) as the Indenture Trustee may determine, to the Holders of
such Securities, of all sums due and to become due thereon in respect of
principal (and premium, if any) and interest, but such money need not be
segregated from other funds except to the extent required by law. Money so held
in trust shall not be subject to the provisions of ARTICLE THIRTEEN.
The Company shall pay and indemnify the Indenture Trustee against
any tax, fee or other charge imposed on or assessed against the money or U.S.
Government Obligations deposited pursuant to SECTION 1504 or the principal and
interest received in respect thereof.
Anything herein to the contrary notwithstanding, the Indenture
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
SECTION 1504 which in the opinion of a nationally recognized
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firm of independent public accountants expressed in a written certification
thereof delivered to the Indenture Trustee, are in excess of the amount
thereof which would then be required to be deposited to effect an equivalent
defeasance or covenant defeasance, as applicable, in accordance with this
Article Fifteen.
Section 1506. REINSTATEMENT.
If the Indenture Trustee or the Paying Agent is unable to apply
any money in accordance with SECTION 1505 by reason of any order or judgment or
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's obligations under the
Securities of such series shall be revived and reinstated as though no deposit
had occurred pursuant to this Article Fifteen until such time as the Indenture
Trustee or Paying Agent is permitted to apply all such money in accordance with
SECTION 1505; PROVIDED, HOWEVER, that if the Company makes any payment of
principal of (and premium, if any) or interest on any such Security following
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the money
held by the Indenture Trustee or the Paying Agent.
Section 1507. QUALIFYING INDENTURE TRUSTEE.
Any indenture trustee appointed pursuant to SECTION 1504 for the
purpose of holding trust funds deposited pursuant to that Section shall be
appointed under any agreement in form acceptable to the Indenture Trustee and
shall provide to the Indenture Trustee a certificate of such indenture trustee,
upon which certificate the Indenture Trustee shall be entitled to conclusively
rely, that all conditions precedent provided for herein to the related
defeasance or covenant defeasance have been complied with. In no event shall
the Indenture Trustee be liable for any acts or omissions of said indenture
trustee.
ARTICLE SIXTEEN
Immunity of Organizers, Promoters, Shareholders, Officers, Trustees and
Employees
Section 1601. EXEMPTION FROM INDIVIDUAL LIABILITY.
No recourse under or upon any obligation, covenant or agreement
of the Company in this Indenture, or of any Security, or for any claim based
thereon or otherwise in respect thereof, shall be had against any organizer,
promoter, shareholder, officer, trustee, or employee, as such, past, present or
future, of the Company or of any successor entity, either directly or through
the Company or any successor entity, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise; it being expressly understood that this Indenture, any supplemental
indenture modifying this Indenture and the obligations issued hereunder are
solely real estate investment trust obligations of the Company, and that no such
personal liability whatever shall attach to, or is or shall be incurred by, the
organizers, promoters, shareholders,
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officers, trustees, or employees, as such, of the Company or of any successor
entity, or any of them, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or agreements
contained in this Indenture, in any supplemental indenture modifying this
Indenture or in any of the Securities or implied therefrom; and that any and
all such personal liability, either at common law or in equity or by
constitution or statute, of, and any and all such rights and claims against,
every such organizer, promoter, shareholder, officer, trustee, or employee,
as such, because of the creation of the indebtedness hereby authorized, or
under or by reason of the obligations, covenants or agreements contained in
this Indenture, in any supplemental indenture modifying this Indenture or in
any of the Securities or implied therefrom, are hereby expressly waived and
released as a condition of, and as a consideration for, the execution of this
Indenture, any supplemental indenture modifying this Indenture and the issue
of such Securities.
*****
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture
to be duly executed as of the day and year first above written.
PRIME GROUP REALTY TRUST
By:
---------------------------------------
Name:
Title:
BANKERS TRUST COMPANY, as Indenture Trustee
By:
---------------------------------------
Name:
Title:
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Exhibit 4.3
- --------------------------------------------------------------------------------
DEPOSIT AGREEMENT
dated as of ________ __, ____
between
PRIME GROUP REALTY TRUST
[NAME OF DEPOSITARY]
and
THE HOLDERS FROM TIME TO TIME OF THE DEPOSITARY SHARES
DESCRIBED HEREIN
- --------------------------------------------------------------------------------
<PAGE>
DEPOSIT AGREEMENT
WHEREAS it is desired to provide, as hereinafter set forth in this
Deposit Agreement, for the deposit of _____% Series ___ Preferred Shares of
Beneficial Interest, par value $.01 per share, of PRIME GROUP REALTY TRUST with
the Depositary (as hereinafter defined) for the purposes set forth in this
Deposit Agreement and for the issuance hereunder of Receipts (as hereinafter
defined) evidencing Depositary Shares (as hereinafter defined) in respect of the
Shares (as hereinafter defined) so deposited;
NOW, THEREFORE, in consideration of the premises contained herein and
such other good and valuable consideration, receipt of which is hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
The following definitions shall for all purposes, unless otherwise
indicated, apply to the respective terms used in this Deposit Agreement and the
Receipts:
"ARTICLES SUPPLEMENTARY" shall mean the articles supplementary filed
with the State Department of Assessments and Taxation of the State of Maryland
classifying and designating the Shares as a series of preferred shares of
beneficial interest of the Company.
"COMPANY" shall mean Prime Group Realty Trust, a Maryland real estate
investment trust, and its successors.
"DEPOSIT AGREEMENT" shall mean this Deposit Agreement, as amended or
supplemented from time to time.
"DEPOSITARY" shall mean __________, a _____________ , and any
successor as Depositary hereunder.
"DEPOSITARY SHARES" shall mean Depositary Shares, each representing a
______ interest in a Share and evidenced by a Receipt.
"DEPOSITARY'S AGENT" shall mean an agent appointed by the Depositary
pursuant to SECTION 7.05.
<PAGE>
"DEPOSITARY'S OFFICE" shall mean the office of the Depositary at
____________________, ____________________, ____________________, at which at
any particular time its depositary receipt business shall be administered.
"RECEIPT" shall mean one of the depositary receipts issued hereunder,
whether in definitive or temporary form.
"RECORD HOLDER" as applied with respect to a Depositary Share shall
mean the person in whose name a Receipt evidencing such Depositary Share is
registered on the books of the Depositary maintained for such purpose.
"REGISTRAR" shall mean any bank or trust company which shall be
appointed to register ownership and transfers of Receipts as herein provided.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SHARES" shall mean the Company's _____% Series ___ Preferred Shares
of Beneficial Interest, $0.01 par value per share.
ARTICLE II
FORM OF RECEIPTS; DEPOSIT OF SHARES;
EXECUTION AND DELIVERY, TRANSFER,
SURRENDER AND REDEMPTION OF RECEIPTS
SECTION 2.01. FORM AND TRANSFER OF RECEIPTS. Definitive Receipts
shall be printed, lithographed, typewritten, mimeographed or engraved or
otherwise reproduced in any manner and shall be substantially in the form set
forth in EXHIBIT A, with appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Agreement. As set forth
in SECTION 2.09, all or a portion of the Definitive Receipts may be represented
by one or more book-entry receipts (each, a "BOOK-ENTRY RECEIPT"). Pending the
preparation of definitive Receipts, the Depositary, upon the written order of
the Company delivered in compliance with SECTION 2.02, shall execute and deliver
temporary Receipts which are printed, lithographed, typewritten, mimeographed or
otherwise substantially of the tenor of the definitive Receipts in lieu of which
they are issued and with such appropriate insertions, omissions, substitutions
and other variations as the persons executing such Receipts may determine, as
evidenced by their execution of such Receipts. If temporary Receipts are
issued, the Company and the Depositary will cause definitive Receipts to be
prepared without unreasonable delay. After the preparation of definitive
Receipts, the temporary Receipts shall be exchangeable for definitive Receipts
upon surrender of the temporary Receipts at an office described in the third
paragraph of SECTION 2.02, without
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charge to the holder. Upon surrender for cancellation of any one or more
temporary Receipts, the Depositary shall execute and deliver in exchange
therefor definitive Receipts representing the same number of Depositary Shares
as represented by the surrendered temporary Receipt or Receipts. Such exchange
shall be made at the Company's expense and without any charge therefor. Until
so exchanged, the temporary Receipts shall in all respects be entitled to the
same benefits under this Deposit Agreement, and with respect to the Shares, as
definitive Receipts.
Receipts shall be executed by the Depositary by the manual signature
of a duly authorized officer of the Depositary; PROVIDED, that such signature
may be a facsimile if a Registrar for the Receipts (other than the Depositary)
shall have been appointed and such Receipts are countersigned by manual
signature of a duly authorized officer of the Registrar. No Receipt shall be
entitled to any benefits under this Deposit Agreement or be valid or obligatory
for any purpose unless it shall have been executed manually by a duly authorized
officer of the Depositary or, if a Registrar for the Receipts (other than the
Depositary) shall have been appointed, by facsimile signature of a duly
authorized officer of the Depositary and countersigned manually by a duly
authorized officer of such Registrar. The Depositary shall record on its books
each Receipt so signed and delivered as hereinafter provided.
Receipts may be endorsed with or have incorporated in the text thereof
such legends or recitals or changes not inconsistent with the provisions of this
Deposit Agreement as may be required by the Company or the Depositary or
required to comply with any applicable law or any regulation thereunder or with
the rules and regulations of any securities exchange upon which the Shares, the
Depositary Shares or the Receipts may be listed or to conform with any usage
with respect thereto, or to indicate any special limitations or restrictions to
which any particular Receipts are subject.
Subject to any limitations set forth in a Receipt or in this Deposit
Agreement title to Depositary Shares evidenced by a Receipt which is properly
endorsed or accompanied by a properly executed instrument of transfer shall be
transferable by delivery with the same effect as in the case of a negotiable
instrument; PROVIDED, HOWEVER, that until transfer of a Depositary Share shall
be registered on the books of the Depositary as provided in SECTION 2.04, the
Depositary may, notwithstanding any notice to the contrary, treat the Record
Holder thereof at such time as the absolute owner thereof for the purpose of
determining the person entitled to distributions of dividends or other
distributions with respect to the Shares or to any notice provided for in this
Deposit Agreement and for all other purposes.
The Depositary shall not lend any Shares deposited hereunder.
SECTION 2.02. DEPOSIT OF SHARES; EXECUTION AND DELIVERY OF RECEIPTS
IN RESPECT THEREOF. Subject to the terms and conditions of this Deposit
Agreement, the Company may from time to time deposit Shares under this Deposit
Agreement by delivery
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to the Depositary of a certificate or certificates representing the Shares to be
deposited. Such certificate or certificates representing the Shares shall be
properly endorsed or accompanied, if required by the Depositary, by a duly
executed instrument of transfer or endorsement, in form satisfactory to the
Depositary, together with all such certifications as may be required by the
Depositary in accordance with the provisions of this Deposit Agreement, and
together with a written order of the Company directing the Depositary to execute
and deliver to, or upon the written order of, the person or persons stated in
such order a Receipt or Receipts for the number of Depositary Shares relating to
such deposited Shares.
All Shares deposited by the Company with the Depositary shall be held
by the Depositary at the Depositary's Office or at such other place or places as
the Depositary shall determine.
Upon receipt by the Depositary of a certificate or certificates
representing the Shares deposited in accordance with the provisions of this
Section, together with the other documents required as above specified, and upon
recordation of the Shares so deposited on the books of the Company in the name
of the Depositary or its nominee, the Depositary, subject to the terms and
conditions of this Deposit Agreement, shall execute and deliver, to or upon the
order of the person or persons named in the written order delivered to the
Depositary referred to in the first paragraph of this Section, a Receipt or
Receipts for the number of Depositary Shares relating to the Shares so deposited
and registered in such name or names as may be requested by such person or
persons. The Depositary shall execute and deliver such Receipt or Receipts at
the Depositary's Office or such other offices, if any, as the Depositary may
designate. Delivery at other offices shall be at the risk and expense of the
person requesting such delivery.
Other than in the case of splits, combinations or other
reclassifications affecting the Shares, or in the case of dividends or other
distributions of Shares, if any, there shall be deposited hereunder not more
than ______ Shares.
SECTION 2.03. REDEMPTION OF SHARES. Whenever the Company shall elect
to redeem Shares in accordance with the provisions of the Articles
Supplementary, it shall (unless otherwise agreed in writing with the Depositary)
mail notice to the Depositary of such proposed redemption, by first class mail,
postage prepaid, not less than 40 or more than 70 days prior to the date fixed
for redemption of Shares in accordance with Section ___ of the Articles
Supplementary. On the date of such redemption, provided that the Company shall
then have paid in full to the Depositary the redemption price of the Shares to
be redeemed, plus any accrued and unpaid dividends thereon, the Depositary shall
redeem the Depositary Shares relating to such Shares. The Depositary shall mail
notice of such redemption and the proposed simultaneous redemption of the number
of Depositary Shares relating to the Shares to be redeemed, by first-class mail,
postage prepaid, not less than 30 and not more than 60 days prior to the date
fixed for redemption of such Shares and
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Depositary Shares (the "REDEMPTION DATE"), to the Record Holders of the
Depositary Shares to be so redeemed, at the addresses of such holders as they
appear on the records of the Depositary; PROVIDED, HOWEVER, neither failure to
mail any such notice to one or more such holders nor any defect in any notice to
one or more such holders shall affect the sufficiency of the proceedings for
redemption as to other holders. Each such notice shall state: (i) the
Redemption Date; (ii) the place or places where Receipts evidencing Depositary
Shares are to be surrendered for payment of the redemption price; (iii) the
redemption price; (iv) that dividends in respect of the Shares underlying the
Depositary Shares to be redeemed will cease to accrue and accumulate at the
close of business on such Redemption Date; (v) the number of Depositary Shares
to be redeemed and, if less than all the Depositary Shares held by any such
holder are to be redeemed, the number of such Depositary Shares held by such
holder to be so redeemed; and (vi) if a date other than the Redemption Date, the
date from and after which the Shares and Depositary Shares shall no longer be
deemed to be outstanding. In case less than all the outstanding Depositary
Shares are to be redeemed, the Depositary Shares to be so redeemed shall be
selected by lot, pro rata or such other method as may be determined by the
Depositary to be equitable.
Notice having been mailed by the Depositary as aforesaid, from and
after the Redemption Date (unless the Company shall have failed to redeem the
Shares to be redeemed by it as set forth in the Company's notice provided for in
the preceding paragraph) all dividends in respect of the Depositary Shares so
called for redemption shall cease to accrue and accumulate, the Depositary
Shares being redeemed from such proceeds shall be deemed to be no longer
outstanding, all rights of the holders of Receipts evidencing such Depositary
Shares (except the right to receive the redemption price) shall, to the extent
of such Depositary Shares, cease and terminate and, upon surrender in accordance
with such notice of the Receipts evidencing any such Depositary Shares (properly
endorsed or assigned for transfer, if the Depositary shall so require), such
Depositary Shares shall be redeemed by the Depositary at a redemption price per
Depositary Share equal to the proportionate part of the redemption price per
share paid in respect of the Shares plus all money and other property, if any,
paid with respect to such Depositary Shares, including all amounts paid by the
Company in respect of dividends which on the Redemption Date have accumulated on
the Shares to be so redeemed and have not theretofore been paid.
If less than all the Depositary Shares evidenced by a Receipt are
called for redemption, the Depositary will deliver to the holder of such Receipt
upon its surrender to the Depositary, together with the redemption payment, a
new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and
not called for redemption; PROVIDED, HOWEVER, that such Replacement Receipt
shall be issued only in denominations of whole Depositary Shares and cash will
be payable in respect of fractional interests.
SECTION 2.04. REGISTRATION OF TRANSFER OF RECEIPTS. Subject to the
terms and conditions of this Deposit Agreement, the Depositary shall register on
its books from
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time to time transfers of Depositary Shares upon any surrender of the Receipt or
Receipts evidencing such Depositary Shares by the holder in person or by duly
authorized attorney, properly endorsed or accompanied by a properly executed
instrument of transfer; provided, however, that except as otherwise provided
herein or in any Book-Entry Receipt, each Book-Entry Receipt may be transferred
only in whole and only to the Depositary, to another nominee of the Depositary,
to a successor depository, or to a nominee of a successor depository. Thereupon
the Depositary shall execute a new Receipt or Receipts evidencing the same
aggregate number of Depositary Shares as those evidenced by the Receipt or
Receipts surrendered and deliver such new Receipt or Receipts to or upon the
order of the person entitled thereto.
SECTION 2.05. SPLIT-UPS AND COMBINATIONS OF RECEIPTS; SURRENDER OF
DEPOSITARY SHARES AND WITHDRAWAL OF SHARES. Upon surrender of a Receipt or
Receipts at the Depositary's Office or at such other offices as it may designate
for the purpose of effecting a split-up or combination of such Receipt or
Receipts, and subject to the terms and conditions of this Deposit Agreement, the
Depositary shall execute and deliver a new Receipt or Receipts in the
denominations requested, evidencing the aggregate number of Depositary Shares
evidenced by the Receipt or Receipts surrendered. The Depositary shall give
prompt notice of such action and the certificate numbers to the Registrar for
the purposes of recording such split-up or consolidation.
Unless the Depositary Shares have previously been called for
redemption, any holder of Depositary Shares may withdraw the number of whole
Shares underlying such Depositary Shares and all money and other property, if
any, underlying such Depositary Shares by surrendering Receipts evidencing such
Depositary Shares at the Depositary's Office or at such other offices as the
Depositary may designate for such withdrawals. Thereafter, without unreasonable
delay, the Depositary shall deliver to such holder, or to the person or persons
designated by such holder as hereinafter provided, the number of whole Shares
and all money and other property, if any, underlying the Depositary Shares so
surrendered for withdrawal, but holders of such whole Shares will not thereafter
be entitled to deposit such Shares hereunder or to receive Receipts evidencing
Depositary Shares therefor. If a Receipt or Receipts delivered by a holder to
the Depositary in connection with such withdrawal shall evidence in the
aggregate a number of Depositary Shares in excess of the number of Depositary
Shares representing the number of whole Shares to be so withdrawn, the
Depositary shall at the same time, in addition to such number of whole Shares
and such money and other property, if any, to be so withdrawn, deliver to such
holder, or (subject to SECTIONS 2.04 and 3.02) upon his order, a new Receipt
evidencing such excess number of Depositary Shares. Delivery of the Shares and
money and other property being withdrawn may be made by delivery of such
certificates, documents of title and other instruments as the Depositary may
deem appropriate.
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Shares delivered pursuant to the preceding paragraph may be endorsed
with or have incorporated in the text thereof such legend or recitals or changes
not inconsistent with the provisions of this Deposit Agreement as may be
required by the Depositary or required to comply with any applicable law or any
regulation thereunder or with the rules and regulations of any securities
exchange upon which the Shares may be listed or to conform with any usage with
respect thereto, or to indicate any special limitations or restrictions to which
any particular Shares are subject.
If the Shares and the money and other property being withdrawn are to
be delivered to a person or persons other than the Record Holder of the
Depositary Shares evidenced by the Receipts being surrendered for withdrawal of
Shares, such holder shall execute and deliver to the Depositary a written order
so directing the Depositary and the Depositary may require that the Receipt or
Receipts surrendered by such holder for withdrawal of such Shares be properly
endorsed in blank or accompanied by a properly executed instrument of transfer
in blank.
Delivery of the Shares and money and other property, if any,
underlying the Depositary Shares surrendered for withdrawal shall be made by the
Depositary at the Depositary's Office, except that, at the request, risk and
expense of the holder surrendering such Depositary Shares and for the account of
such holder, such delivery may be made at such other place as may be designated
by such holder.
SECTION 2.06. LIMITATIONS ON EXECUTION AND DELIVERY, TRANSFER,
SURRENDER AND EXCHANGE OF RECEIPTS. As a condition precedent to the execution
and delivery, registration of transfer, split-up, combination, surrender or
exchange of any Receipt, the Depositary, any of the Depositary's Agents or the
Company may require payment to it of a sum sufficient for the payment (or, in
the event that the Depositary or the Company shall have made such payment, the
reimbursement to it) of any charges or expenses payable by the holder of a
Receipt pursuant to SECTION 5.07, may require the production of evidence
satisfactory to it as to the identity and genuineness of any signature and may
also require compliance with the rules and regulations of any governmental body,
the New York Stock Exchange, any applicable self regulatory body or such
regulations, if any, as the Depositary or the Company may establish consistent
with the provisions of this Deposit Agreement.
The delivery of Receipts against Shares may be suspended, the
registration of transfer of Depositary Shares may be refused and the
registration of transfer, surrender or exchange of outstanding Depositary Shares
may be suspended (i) during any period when the register of shareholders of the
Company is closed or (ii) if any such action is deemed necessary or advisable by
the Depositary, any of the Depositary's Agents or the Company at any time or
from time to time because of any requirement of law or of any government or
governmental body or commission, New York Stock Exchange or under any provision
of this Deposit Agreement.
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SECTION 2.07. LOST RECEIPTS, ETC. In case any Receipt shall be
mutilated, destroyed, lost or stolen, the Depositary in its discretion may
execute and deliver a Receipt of like form and tenor in exchange and
substitution for such mutilated Receipt or in lieu of and in substitution for
such destroyed, lost or stolen Receipt, upon (i) the filing by the holder
thereof with the Depositary of evidence satisfactory to the Depositary of such
destruction or loss or theft of such Receipt, of the authenticity thereof and of
his or her ownership thereof and (ii) the holder's furnishing of the Depositary
with reasonable indemnification satisfactory to such Depositary and the Company.
SECTION 2.08. CANCELLATION AND DESTRUCTION OF SURRENDERED RECEIPTS.
All Receipts surrendered to the Depositary or any Depositary's Agent shall be
canceled by the Depositary. Except as prohibited by applicable law or
regulation, the Depositary is authorized to destroy all Receipts so canceled.
SECTION 2.09. BOOK-ENTRY RECEIPTS. (a) All or a portion of the
Receipts may be represented by one or more Book-Entry Receipts deposited with
[the Depository Trust Company] (the "DEPOSITORY") and registered in the name of
[Cede & Co.], a nominee of the Depository. Each Book-Entry Receipt shall bear
such legend or legends as may be required by the Depository in order for it to
accept the Depositary Shares for its book-entry settlement system. Except as
provided for in SECTION 2.09(b), no person acquiring Receipts with book-entry
settlement through the Depository shall receive or be entitled to receive
definitive Receipts. Ownership of beneficial interests in the Depositary Shares
shall be shown on, and the transfer of such ownership shall be affected through,
records maintained by (i) the Depository or its nominee for each Book-Entry
Receipt, or (ii) institutions that have accounts with the Depository (such
institution, with respect to a Depositary Share in its account, a
"PARTICIPANT").
(b) If subsequently (i)(1) the Depository notifies the Company in
accordance with SECTION 7.04 that it is unwilling or unable to continue as a
depository for such Depositary Shares or (2) at any time the Depository ceases
to be a clearing agency registered under the Securities Exchange Act of 1934, as
amended, at a time when the Depository is required to be so registered in order
to act as such depository and (ii) the Company does not appoint a successor
within 90 days, the Depositary shall provide written instructions to the
Depository to deliver to the Depositary for cancellation each Book-Entry
Receipt, and the Company shall instruct the Depository to deliver to the
Depositary definitive Receipts in physical form evidencing such Depositary
Shares. Such definitive Receipts shall be in the form amended hereto as EXHIBIT
A with appropriate insertions, modification and omissions, as provided above.
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ARTICLE III
CERTAIN OBLIGATIONS OF THE HOLDERS
OF RECEIPTS AND THE COMPANY
SECTION 3.01. FILING PROOFS, CERTIFICATES AND OTHER INFORMATION. Any
holder of a Depositary Share may be required from time to time to file such
proof of residence, or other matters or other information, to obtain such
guarantees of signature, to execute such certificates and to make such
representations and warranties as the Depositary or the Company may deem
reasonably necessary or proper. The Depositary or the Company may withhold the
delivery, or delay the registration of transfer, redemption or exchange, of any
Depositary Share or the withdrawal of any Shares underlying Depositary Shares or
the distribution of any dividend or other distribution or the sale of any rights
or of the proceeds thereof until such proof or other information is filed or
such certificates are executed or such representations and warranties are made.
SECTION 3.02. PAYMENT OF TAXES OR OTHER GOVERNMENTAL CHARGES.
Holders of Depositary Shares shall be obligated to make payments to the
Depositary of certain charges and expenses as provided in SECTION 5.07.
Registration of transfer of any Depositary Share or any withdrawal of Shares and
delivery of all money or other property, if any, underlying such Depositary
Share may be refused until any such payment due is made, and any dividends or
other distributions may be withheld or all or any part of the Shares or other
property relating to such Depositary Shares and not theretofore sold may be sold
for the account of the holder thereof (after attempting by reasonable means to
notify such holder prior to such sale), and such dividends or other
distributions or the proceeds of any such sale may be applied to any payment of
such charges or expenses, the holder of such Depositary Share remaining liable
for any deficiency.
SECTION 3.03. WARRANTY AS TO SHARES. The Company hereby represents
and warrants to the Depositary that the Shares, when issued, will be validly
issued, fully paid and nonassessable. Such representation and warranty shall
survive the deposit of the Shares and the issuance of the Receipts.
SECTION 3.04. WARRANTY AS TO RECEIPTS. The Depositary hereby
represents and warrants that the Receipts, when issued, will be legal, valid and
binding obligations of the Depositary, enforceable against the Depositary in
accordance with their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
Such representation and warranty shall survive the deposit of the Shares and the
issuance of the Receipts.
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ARTICLE IV
THE DEPOSITED SECURITIES; NOTICES
SECTION 4.01. CASH DISTRIBUTIONS. Whenever the Depositary shall
receive any cash dividend or other cash distribution on the Shares, the
Depositary shall, subject to SECTIONS 3.01 and 3.02, distribute to the Record
Holders of Depositary Shares on the record date fixed pursuant to SECTION 4.04
such amounts of such dividend or distribution as are, as nearly as practicable,
in proportion to the respective numbers of Depositary Shares held by such
holders; PROVIDED, HOWEVER, that in case the Company or the Depositary shall be
required to withhold and shall withhold from any cash dividend or other cash
distribution in respect of the Shares an amount on account of taxes, the amount
made available for distribution or distributed in respect of Depositary Shares
shall be reduced accordingly. The Depositary shall distribute or make available
for distribution, as the case may be, only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares a fraction of
one cent, and any balance not so distributable shall be held by the Depositary
(without liability for interest thereon) and shall be added to and be treated as
part of the next succeeding distribution to record holders of Receipts.
SECTION 4.02. DISTRIBUTIONS OTHER THAN CASH. Whenever the Depositary
shall receive any distribution other than cash with respect to the Shares, the
Depositary shall, subject to SECTIONS 3.01 and 3.02, distribute to the Record
Holders of Depositary Shares on the record date fixed pursuant to SECTION 4.04
such amounts of the securities or property received by it as are, as nearly as
practicable, in proportion to the respective numbers of Depositary Shares held
by such holders, in any manner that the Depositary may deem equitable and
practicable for accomplishing such distribution. If in the opinion of the
Depositary such distribution cannot be made proportionately among such Record
Holders, or if for any other reason (including any requirement that the Company
or the Depositary withhold an amount on account of taxes or governmental
charges) the Depositary deems, after consultation with the Company, such
distribution not to be feasible, the Depositary may, with the approval of the
Company, adopt such method as it deems equitable and practicable for the purpose
of effecting such distribution, including the sale (at public or private) of the
securities or property thus received, or any part thereof, at such place or
places and upon such terms as it may deem proper. The net proceeds of any such
sale shall, subject to SECTIONS 3.01 and 3.02, be distributed or made available
for distribution, as the case may be, by the Depositary to the Record Holders of
Depositary Shares entitled thereto as provided by SECTION 4.01 in the case of a
distribution received in cash. The Company shall not make any distribution of
such securities unless the Company shall have provided an opinion of counsel to
the effect that such securities have been registered under the Securities Act or
do not need to be registered.
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SECTION 4.03. SUBSCRIPTION RIGHTS, PREFERENCES OR PRIVILEGES. If the
Company shall at any time offer or cause to be offered to the persons in whose
names Shares are recorded on the books of the Company any rights, preferences or
privileges to subscribe for or to purchase any securities or any rights,
preferences or privileges of any other nature, such rights, preferences or
privileges shall in each such instance be made available by the Depositary to
the Record Holders of Depositary Shares in such manner as the Depositary may
determine, either by the issue to such Record Holders of warrants representing
such rights, preferences or privileges or by such other method as may be
approved by the Depositary in its discretion with the approval of the Company;
provided, however, that (i) if at the time of issue or offer of any such rights,
preferences or privileges the Depositary determines that it is not lawful or
(after consultation with the Company) not feasible to make such rights,
preferences or privileges available to holders of Depositary Shares by the issue
of warrants or otherwise, or (ii) if and to the extent so instructed by holders
of Depositary Shares who do not desire to exercise such rights, preferences or
privileges, then the Depositary, in its discretion (with the approval of the
Company, in any case where the Depositary has determined that it is not feasible
to make such rights, preferences or privileges available), may, if applicable
laws or the terms of such rights, preferences or privileges permit such
transfer, sell such rights, preferences or privileges at public or private sale,
at such place or places and upon such terms as it may deem proper. The net
proceeds of any such sale shall, subject to SECTIONS 3.01 and 3.02, be
distributed by the Depositary to the Record Holders of Depositary Shares
entitled thereto as provided by SECTION 4.01 in the case of a distribution
received in cash. The Company shall not make any distribution of such rights,
preferences or privileges unless the Company shall have provided an opinion of
counsel to the effect that such rights, preferences or privileges have been
registered under the Securities Act or do not need to be registered.
If registration under the Securities Act of the securities to which
any rights, preferences or privileges relate is required in order for holders of
Depositary Shares to be offered or sold the securities to which such rights,
preferences or privileges relate, the Company agrees with the Depositary that it
will file promptly a registration statement pursuant to such Act with respect to
such rights, preferences or privileges and securities and use its best efforts
and take all steps available to it to cause such registration statement to
become effective sufficiently in advance of the expiration of such rights,
preferences or privileges to enable such holders to exercise such rights,
preferences or privileges. In no event shall the Depositary make available to
the holders of Depositary Shares any right, preference or privilege to subscribe
for or to purchase any securities unless and until such a registration statement
shall have become effective, or unless the offering and sale of such securities
to such holders are exempt from registration under the provisions of such Act.
If any other action under the laws of any jurisdiction or any
governmental or administrative authorization, consent or permit is required in
order for such rights, preferences or privileges to be made available to the
holders of Depositary Shares, the
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Company agrees with the Depositary that the Company will use its best efforts to
take such action or obtain such authorization, consent or permit sufficiently in
advance of the expiration of such rights, preferences or privileges to enable
such holders to exercise such rights, preferences or privileges.
SECTION 4.04. NOTICE OF DIVIDENDS, ETC.; FIXING OF RECORD DATE FOR
HOLDERS OF DEPOSITARY SHARES. (i) Whenever any cash dividend or other cash
distribution shall become payable or any distribution other than cash shall be
made, (ii) if rights, preferences or privileges shall at any time be offered,
with respect to the Shares, (iii) whenever the Depositary shall receive notice
of (a) any meeting at which holders of Shares are entitled to vote or of which
holders of Shares are entitled to notice, or (b) any election by the Company to
redeem any Shares, or (iv) whenever the Depositary and the Company shall decide
it is appropriate, the Depositary shall in each such instance fix a record date
(which shall be the same date as the record date fixed by the Company with
respect to the Shares) for the determination of the holders of Depositary Shares
who shall be entitled to receive a distribution in respect of such dividend,
distribution, rights, preferences or privileges or the net proceeds of the sale
thereof, or to give instructions for the exercise of voting rights at any such
meeting, or who shall be entitled to receive notice of such meeting.
SECTION 4.05. VOTING RIGHTS. Upon receipt of notice of any meeting
at which the holders of the Shares are entitled to vote, the Depositary shall,
as soon as practicable thereafter, mail to the Record Holders of Depositary
Shares a notice which shall contain (i) such information as is contained in such
notice of meeting and (ii) a statement informing holders of Depositary Shares
that they may instruct the Depositary as to the exercise of the voting rights
pertaining to the amount of Shares underlying their respective Depositary Shares
and a brief statement as to the manner in which such instructions may be given.
Upon the written request of the holders of Depositary Shares on the record date
established in accordance with SECTION 4.04, the Depositary shall endeavor
insofar as practicable to vote or cause to be voted, in accordance with the
instructions set forth in such requests, the maximum number of whole Shares
underlying the Depositary Shares as to which any particular voting or consent
instructions are received. The Company hereby agrees to take all action which
may be deemed necessary by the Depositary in order to enable the Depositary to
vote such Shares or cause such Shares to be voted. In the absence of specific
instructions from the holder of a Depositary Share, the Depositary will abstain
from voting (but, at its discretion, not from appearing at any meeting held with
respect to such Shares unless directed to the contrary by the holders of all the
Depositary Shares) to the extent of the Shares underlying the Depositary Shares
evidenced by such Receipt.
SECTION 4.06. CHANGES AFFECTING DEPOSITED SECURITIES AND
RECLASSIFICATIONS, RECAPITALIZATIONS, ETC. Upon any change in par or
liquidation value, split-up, combination or any other reclassification of the
Shares, or upon any recapitalization, reorganization, merger, amalgamation or
consolidation affecting the Company or to which
12
<PAGE>
it is a party, the Depositary may in its discretion, with the approval of, and
shall upon the instructions of, the Company, and (in either case) in such manner
as the Depositary may deem equitable, (i) make such adjustments in (a) the
fraction of an interest in one Share underlying one Depositary Share and (b) the
ratio of the redemption price per Depositary Share to the redemption price of a
Share, in each case as may be necessary to reflect fully the effects of such
change in par or liquidation value, split-up, combination or other
reclassification of the Shares, or of such recapitalization, reorganization,
merger, amalgamation or consolidation and (ii) treat any securities which shall
be received by the Depositary in exchange for or upon conversion of or in
respect of the Shares as new deposited securities so received in exchange for or
upon conversion of or in respect of such Shares. In any such case the Depositary
may in its discretion, with the approval of the Company, execute and deliver
additional Receipts, or may call for the surrender of all outstanding Receipts
to be exchanged for new Receipts specifically describing such new deposited
securities.
Anything to the contrary herein or in the Receipt notwithstanding,
holders of Receipts shall have the right from and after the effective date or
any such change in par or stated value, split-up, combination or other
reclassification of the Shares or any such recapitalization, reorganization,
merger, amalgamation, consolidation or sale, to the extent that holders of
Shares had the right, prior to or on the applicable effective date, to convert,
exchange or surrender Shares into or for other shares, securities, property or
cash, to surrender such Receipts to the Depositary with instructions to convert,
exchange or surrender the Shares represented thereby only into or for, as the
case may be, the kind and amount of shares and other securities and property and
cash into which the Shares represented by such Receipts has been converted or
for which such Shares might have been exchanged or surrendered immediately prior
to the effective date of such transaction.
SECTION 4.07. DELIVERY OF REPORTS. The Depositary will forward to
Record Holders of Receipts, at their respective addresses appearing in the
Depositary's books, all notices, reports and communications received from the
Company which are delivered to the Depositary and which the Company is required
to furnish to the holders of Shares or Receipts.
SECTION 4.08. LIST OF HOLDERS. Promptly upon request from time to
time by the Company, the Depositary shall furnish to it a list, as of a recent
date, of the names, addresses and holdings of Depositary Shares of all persons
in whose names Depositary Shares are registered on the books of the Depositary
or Registrar, as the case may be.
ARTICLE V
THE DEPOSITARY, THE DEPOSITARY'S AGENTS,
13
<PAGE>
THE REGISTRAR AND THE COMPANY
SECTION 5.01. MAINTENANCE OF OFFICES, AGENCIES AND TRANSFER BOOKS BY
THE DEPOSITARY; REGISTRAR. Upon execution of this Deposit Agreement, the
Depositary shall maintain at the Depositary's Offices or at any Registrar's
Office, facilities for the execution and delivery, surrender and exchange of
Receipts and the registration and registration of transfer of Depositary Shares
and at the offices of the Depositary's Agents, if any, facilities for the
delivery, surrender and exchange of Receipts and the registration of transfer of
Depositary Shares, all in accordance with the provisions of this Deposit
Agreement. The Depositary shall have complete access to all books and records
maintained on the Company's behalf at such Depositary's Offices or at such
Registrar's Offices.
The Depositary shall keep books at the Depositary's Office for the
registration and registration of transfer of Depositary Shares, which books at
all reasonable times shall be open for inspection by the Record Holders of
Depositary Shares; provided, that any such holder requesting to exercise such
right shall certify to the Depositary that such inspection shall be for a proper
purpose reasonably related to such person's interest as an owner of Depositary
Shares.
The Depositary may close such books, at any time or from time to time,
when deemed expedient by it in connection with the performance of its duties
hereunder.
If the Receipts or the Depositary Shares evidenced thereby or the
Shares underlying such Depositary Shares shall be listed on the New York Stock
Exchange, the Depositary may, with the approval of the Company, appoint a
Registrar for registration of such Receipts or Depositary Shares in accordance
with any requirements of such Exchange. Such Registrar (which may be the
Depositary if so permitted by the requirements of such Exchange) may be removed
and a substitute registrar appointed by the Depositary upon the request or with
the approval of the Company. If such Receipts, such Depositary Shares or such
Shares are listed on one or more other stock exchanges, the Depositary will, at
the request of the Company, arrange such facilities for the delivery,
registration, registration of transfer, surrender and exchange of such Receipts,
such Depositary Shares or such Shares as may be required by law or applicable
stock exchange regulation.
SECTION 5.02. PREVENTION OF OR DELAY IN PERFORMANCE BY THE
DEPOSITARY, THE DEPOSITARY'S AGENTS, ANY REGISTRAR OR THE COMPANY. Neither the
Depositary nor any Depositary's Agent nor any Registrar nor the Company shall
incur any liability to any holder Depositary Share if by reason of any provision
of any present or future law, or regulation thereunder, of the United States of
America or of any other governmental authority or, in the case of the
Depositary, any Depositary's Agent or any Registrar, by reason of any provision,
present or future, of the Company's Amended and Restated Declaration of Trust
(including the Articles Supplementary) or by reason of any act of God or war or
other circumstance
14
<PAGE>
beyond the control of the relevant party, the Depositary, any Depositary's
Agent, any Registrar or the Company shall be prevented or forbidden from doing
or performing any act or thing which the terms of this Deposit Agreement provide
shall be done or performed; nor shall the Depositary, any Depositary's Agent,
any Registrar or the Company incur any liability to any holder of a Depositary
Share (i) by reason of any nonperformance or delay, caused as aforesaid, in the
performance of any act or thing which the terms of this Deposit Agreement
provide shall or may be done or performed, or (ii) by reason of any exercise of,
or failure to exercise, any discretion provided for in this Deposit Agreement
except, in the case of any such exercise or failure to exercise discretion not
caused as aforesaid, if caused by the gross negligence or willful misconduct of
the party charged with such exercise or failure to exercise.
SECTION 5.03. OBLIGATIONS OF THE DEPOSITARY, THE DEPOSITARY'S AGENTS,
ANY REGISTRAR AND THE COMPANY. Neither the Depositary nor any Depositary's
Agent nor any Registrar nor the Company assumes any obligation or shall be
subject to any liability under this Deposit Agreement to holders of Depositary
Shares other than for its negligence or willful misconduct.
Neither the Depositary nor any Depositary's Agent nor any Registrar
nor the Company shall be under any obligation to appear in, prosecute or defend
any action, suit or other proceeding in respect of the Shares, the Depositary
Shares or the Receipts which in its opinion may involve it in expense or
liability unless indemnity satisfactory to it against all expense and liability
be furnished as often as may be required.
Neither the Depositary nor any Depositary's Agent nor any Registrar
nor the Company shall be liable for any action or any failure to act by it in
reliance upon the written advice of legal counsel or accountants, or information
from any person presenting Shares for deposit, any holder of a Depositary Share
or any other person believed by it in good faith to be competent to give such
information. The Depositary, any Depositary's Agent, any Registrar and the
Company may each rely and shall each be protected in acting upon any written
notice, request, direction or other document believed by it to be genuine and to
have been signed or presented by the proper party or parties.
The Depositary shall not be responsible for any failure to carry out
any instruction to vote any of the Shares or for the manner or effect of any
such vote, as long as any such action or non-action is in good faith. The
Depositary undertakes and shall cause any Registrar to undertake, to perform
such duties and only such duties as are specifically set forth in this Deposit
Agreement using its reasonable best efforts and in good faith. The parties
hereto acknowledge that no implied covenants or obligations shall be read into
this Deposit Agreement against the Depositary or any Registrar. The Depositary
will indemnify the Company against any liability which may arise out of acts
performed or omitted by the Depositary or its agents due to its or their gross
negligence or bad faith. The Depositary, any
15
<PAGE>
Depositary's Agents, any Registrar and the Company may own and deal in any class
of securities of the Company and its affiliates and in Depositary Shares. The
Depositary may also act as transfer agent or registrar of any of the securities
of the Company and its affiliates.
SECTION 5.04. RESIGNATION AND REMOVAL OF THE DEPOSITARY; APPOINTMENT
OF SUCCESSOR DEPOSITARY. The Depositary may at any time resign as Depositary
hereunder by notice of its election so to do delivered to the Company, such
resignation to take effect upon the appointment of a successor Depositary and
its acceptance of such appointment as hereinafter provided.
The Depositary may at any time be removed by the Company by notice of
such removal delivered to the Depositary, such removal to take effect upon the
appointment of a successor Depositary and its acceptance of such appointment as
hereinafter provided.
In case the Depositary acting hereunder shall at any time resign or be
removed, the Company shall, within 60 days after the delivery of the notice of
resignation or removal, as the case may be, appoint a successor Depositary,
which shall be a bank or trust company having its principal office in the United
States of America and having a combined capital and surplus of at least
$50,000,000. If no successor Depositary shall have been so appointed within 60
days after delivery of such notice, the resigning or removed Depositary may
petition any court of competent jurisdiction for the appointment of a successor
Depositary. Every successor Depositary shall execute and deliver to its
predecessor and to the Company an instrument in writing accepting its
appointment hereunder, and thereupon such successor Depositary, without any
further act or deed, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor and for all purposes shall be the
Depositary under this Deposit Agreement, and such predecessor, upon payment of
all sums due it and on the written request of the Company, shall execute and
deliver an instrument transferring to such successor all rights and powers of
such predecessor hereunder, shall duly assign, transfer and deliver all right,
title and interest in the Shares and any moneys or property held hereunder to
such successor and shall deliver to such successor a list of the Record Holders
of all outstanding Depositary Shares. Any successor Depositary shall promptly
mail notice of its appointment to the Record Holders of Depositary Shares.
Any corporation into or with which the Depositary may be merged,
consolidated or converted shall be the successor of such Depositary without the
execution or filing of any document or any further act. Such successor
Depositary may authenticate the Receipts in the name of the predecessor
Depositary or in the name of the successor Depositary.
SECTION 5.05. CORPORATE NOTICES AND REPORTS. The Company agrees that
it will deliver to the Depositary and the Depositary will, promptly after
receipt thereof,
16
<PAGE>
transmit to the Record Holder of Depositary Shares, in each case at the address
furnished to it pursuant to SECTION 4.08, all notices, reports and
communications (including without limitation financial statements) required by
law, the rules of any national securities exchange upon which the Shares, the
Depositary Shares or the Receipts are listed or by the Company's Amended and
Restated Declaration of Trust (including the Articles Supplementary) to be
furnished by the Company to holders of the Shares. Such transmission will be at
the Company's expense and the Company will provide the Depositary with such
number of copies of such documents as the Depositary may reasonably request.
SECTION 5.06. INDEMNIFICATION BY THE COMPANY. The Company shall
indemnify the Depositary, any Depositary's Agent and any Registrar against, and
hold each of them harmless from, any loss, liability or expense (including the
costs and expenses of defending itself) which may arise out of (i) acts
performed or omitted in connection with this Deposit Agreement and the
Depositary Shares (a) by the Depositary, any Registrar or any of their
respective agents (including any Depositary's Agent), except for any liability
arising out of negligence, willful misconduct or bad faith on the respective
parts of any such person or persons, or (b) by the Company or any of its agents,
or (ii) the offer, sale or registration of the Depositary Shares or the Shares
pursuant to the provisions hereof. The obligations of the Company set forth in
this SECTION 5.06 shall survive any succession of any Depositary, Registrar or
Depositary's Agent.
SECTION 5.07. CHARGES AND EXPENSES. The Company shall pay all
transfer and other taxes and governmental charges arising solely from the
existence of the depositary arrangements. The Company shall pay all charges of
the Depositary in connection with the initial deposit of the Shares and the
initial issuance of the Receipts, any redemption of the Shares at the option of
the Company and any withdrawals of Shares by holders of Depositary Shares. All
other transfer and other taxes and governmental charges shall be at the expense
of holders of Depositary Shares. The Depositary may refuse to effect any
transfer of a Receipt or any withdrawal of Shares evidenced hereby until all
such taxes and charges with respect to such receipt or shares are paid by the
holders thereof. If, at the request of a holder of a Depositary Share, the
Depositary incurs charges or expenses for which it is not otherwise liable
hereunder, such holder will be liable for such charges and expenses. All other
charges and expenses of the Depositary, any Depositary's Agent hereunder and any
Registrar (including, in each case, fees and expenses of counsel) incident to
the performance of their respective obligations hereunder will be paid upon
consultation and agreement between the Depositary and the Company as to the
amount and nature of such charges and expenses. The Depositary shall present
its statement for charges and expenses to the Company once every three months or
at such other intervals as the Company and the Depositary may agree.
17
<PAGE>
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. AMENDMENT. The form of the Receipts and any provisions
of this Deposit Agreement may at any time and from time to time be amended by
agreement between the Company and the Depositary in any respect which they may
deem necessary or desirable; PROVIDED, HOWEVER, that no such amendment which
shall materially and adversely alter the rights of the existing holders of
Depositary Shares shall be effective unless such amendment shall have been
approved by the holders of at least a majority of the Depositary Shares then
outstanding. Every holder of an outstanding Depositary Share at the time any
such amendment becomes effective shall be deemed, by continuing to hold such
Depositary Share, to consent and agree to such amendment and to be bound by this
Deposit Agreement as amended thereby. In no event shall any amendment impair
the right, subject to the provisions of SECTIONS 2.05 and 2.06, of any owner of
any Depositary Shares to surrender any Receipt evidencing such Depositary Shares
to the Depositary with instructions to deliver to the holder the Shares and all
money and other property, if any, represented thereby, except in order to comply
with mandatory provisions of applicable law or the rules and regulations of any
governmental body, agency or commission, the depository for any Book-Entry
Receipts, the New York Stock Exchange or any applicable stock exchange.
SECTION 6.02. TERMINATION. This Deposit Agreement may be terminated
by the Company or the Depositary only after (i) all outstanding Depositary
Shares shall have been redeemed and any accumulated and unpaid dividends on the
Shares represented by the Depositary Shares, together with all other moneys and
property, if any, to which holders of the related Receipts are entitled under
the terms of such Receipts or this Deposit Agreement, have been paid or
distributed as provided in this Deposit Agreement or provision therefor has been
duly made pursuant to SECTION 2.03, (ii) all the Shares have been withdrawn
pursuant to SECTION 2.05 or (iii) there shall have been made a final
distribution in respect of the Shares in connection with any liquidation,
dissolution or winding up of the Company and such distribution shall have been
distributed to the holders of Receipts pursuant to SECTION 4.01 or 4.02, as
applicable. Whenever the Deposit Agreement has been terminated pursuant to
(iii) above, the Depositary will mail notice of such termination to the record
holders of all Depositary Shares then outstanding at least 30 days prior to the
date fixed in that notice for termination of the Deposit Agreement. If any
Depositary Shares remain outstanding after the date of termination, the
Depositary thereafter will discontinue the transfer of Depositary Shares, will
suspend the distribution of dividends to the owners thereof, and will not give
any further notices (other than notice of such termination) or perform any
further acts under this Deposit Agreement, except that the Depositary will
continue (i) to collect dividends on the Shares and any other distributions with
respect thereto and (ii) to deliver or cause to be delivered Shares, together
with such dividends and distributions, or principal and interest, and the net
proceeds of any sales of rights, preferences, privileges or other property
(other
18
<PAGE>
than real property) in exchange for Depositary Shares surrendered. At any time
after the expiration of three years from the date of termination, the Depositary
may sell the Shares then held by it at a public or private sale, at such place
or places and upon such terms as it deems proper and may thereafter hold the net
proceeds of such sale, without liability for interest, for the pro rata benefit
of the owners of the Depositary Shares which have not theretofore been
surrendered. Subject to applicable escheat laws, any monies set aside by the
Company in respect of any payment with respect to the Shares represented by the
Depositary Shares, or dividends thereon, and unclaimed at the end of three years
from the date upon which such payment is due and payable shall revert to the
general funds of the Company, after which reversion the holders of such
Depositary Shares shall look only to the general funds of the Company for
payment thereof.
Upon the termination of this Deposit Agreement, the parties hereto
shall be discharged from all obligations under this Deposit Agreement except for
their respective obligations under SECTIONS 5.03, 5.06 and 5.07.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. COUNTERPARTS. This Deposit Agreement may be executed
in any number of counterparts and by each of the parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed an original, but all such counterparts taken together shall constitute
one and the same instrument.
SECTION 7.02. EXCLUSIVE BENEFIT OF PARTIES. This Deposit Agreement
is for the exclusive benefit of the parties hereto and their respective
successors hereunder and shall not be deemed to give any legal or equitable
right, remedy or claim to any other person whatsoever.
SECTION 7.03. INVALIDITY OF PROVISIONS. In case any one or more of
the provisions contained in this Deposit Agreement or in the Receipts should be
or become invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein or
therein shall in no way be affected, prejudiced or disturbed thereby.
SECTION 7.04. NOTICES. Any and all notices to be given to the
Company hereunder or under the Receipts shall be in writing and shall be deemed
to have been duly given if personally delivered or sent by mail or telegram or
telex confirmed by letter, addressed to the Company at 77 West Wacker Drive,
Suite 3900, Chicago, Illinois 60601,
19
<PAGE>
telephone (312) __________, facsimile (312) __________, Attention:
____________, or at any other address of which the Company shall have notified
the Depositary in writing.
Any and all notices to be given to the Depositary hereunder or under
the Receipts shall be in writing and shall be deemed to have been duly given if
personally delivered or sent by mail or by telegram, telecopy or telex confirmed
by letter, addressed to the Depositary at the Depositary's Office,
at________________________________, telephone (___) _____-_________, facsimile
(___) _____-_________, Attention: ___________, or at any other address and to
the attention of any other person of which the Depositary shall have notified
the Company in writing.
Any and all notices to be given to any Record Holder of a Receipt
hereunder or under the Receipts shall be in writing and shall be deemed to have
been duly given if personally delivered or sent by mail, telegram or telex (and
confirmed by letter in the case of a telegram or telex), to such Record Holder
at the address of such Record Holder as such address appears on the books of the
Depositary or if such holder shall have filed with the Depositary a written
request that notices intended for such holder be mailed to some other address,
at the address designated in such request.
Delivery of a notice sent by mail or by telegram or telex shall be
deemed to be effected at the time when a duly addressed letter containing the
same (or a confirmation thereof in the case of a telegram or telex message) is
deposited, postage prepaid, in a post office letter box. The Depositary or the
Company may, however, act upon any telegram or telex message received by it from
the other or from any holder of a Depositary Share, notwithstanding that such
telegram or telex message shall not subsequently be confirmed by letter or as
aforesaid.
SECTION 7.05. DEPOSITARY'S AGENTS. The Depositary may from time to
time, with the prior approval of the Company, appoint Depositary's Agents to act
in any respect for the Depositary for the purposes of this Deposit Agreement and
may at any time appoint additional Depositary's Agents and vary or terminate the
appointment of such Depositary's Agents. The Depositary will notify the Company
of any such action.
SECTION 7.06. HOLDERS OF RECEIPTS ARE PARTIES. The holders of
Depositary Shares from time to time shall be parties to this Deposit Agreement
and shall be bound by all of the terms and conditions hereof and of the Receipts
evidencing such Depositary Shares by acceptance of delivery thereof.
SECTION 7.07. GOVERNING LAW. THIS DEPOSIT AGREEMENT AND EACH RECEIPT
AND ALL RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND THEREOF SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF [NEW
20
<PAGE>
YORK] (WITHOUT REFERENCE TO APPLICABLE CONFLICTS OF LAW PROVISIONS).
SECTION 7.08. INSPECTION OF DEPOSIT AGREEMENT. Copies of this
Deposit Agreement shall be filed with the Depositary and the Depositary's Agents
and shall be open to inspection during business hours at the Depositary's Office
and the respective offices of the Depositary's Agents, if any, by any holder of
a Depository Share.
SECTION 7.09. HEADINGS. The headings of articles and sections in
this Deposit Agreement and in the form of Receipt set forth in Exhibit A hereto
have been inserted for convenience only and are not to be regarded as part of
this Deposit Agreement or the Receipts or as having any bearing upon the meaning
or interpretation of any provision contained herein or in the Receipts.
IN WITNESS WHEREOF, the Company and the Depositary have duly executed
this Deposit Agreement as of the day and year first above set forth, and all
holders of Depositary Shares shall become parties hereto by and upon acceptance
by them of delivery of Receipts evidencing such Depositary Shares and issued in
accordance with the terms hereof.
PRIME GROUP REALTY TRUST, a
Maryland real estate investment trust
By
-------------------------------------------
[Name and Title]
---------------------------------------------
As Depositary
By
-------------------------------------------
Authorized Officer
21
<PAGE>
EXHIBIT A
FORM OF DEPOSITARY RECEIPT
FOR DEPOSITARY SHARES
[GENERAL FORM OF FACE OF RECEIPT]
NUMBER DEPOSITARY SHARES
DEPOSITARY RECEIPT FOR DEPOSITARY SHARES,
REPRESENTING __% SERIES ____ PREFERRED SHARES
OF BENEFICIAL INTEREST
PRIME GROUP REALTY TRUST
Organized under the laws of the State of Maryland
This Depositary Receipt is transferable
in [New York, New York]
______________________________, as Depositary, (the "DEPOSITARY"),
hereby certifies that ______________________________ is the registered owner of
____________________ Depositary Shares ("DEPOSITARY SHARES"), each Depositary
Share representing an interest in one of the ____% Series ____ Preferred Shares
of Beneficial Interest, $0.01 par value per share (the "SHARES"), of Prime Group
Realty Trust, a Maryland real estate investment trust (the "COMPANY"), on
deposit with the Depositary, subject to the terms and entitled to the benefits
of the Deposit Agreement dated as of ____________________, _____ (the "DEPOSIT
AGREEMENT"), between the Company, the Depositary and all holders from time to
time of Depositary Receipts. By accepting this Depositary Receipt the holder
hereof becomes a party to and agrees to be bound by all the terms and conditions
of the Deposit Agreement. This Depositary Receipt shall not be valid or
obligatory for any purpose or entitled to any benefits under the Deposit
Agreement unless it shall have been executed by the Depositary by the
<PAGE>
manual signature of a duly authorized officer or, if executed in facsimile by
the Depositary, countersigned by a Registrar in respect of the Depositary
Receipts by the manual signature of a duly authorized officer thereof.
Dated: Depositary
--------------
By:
------------------------------------------
Authorized Officer
Registrar
By:
------------------------------------------
Authorized Officer
<PAGE>
[GENERAL FORM OF REVERSE OF RECEIPT]
PRIME GROUP REALTY TRUST
PRIME GROUP REALTY TRUST WILL FURNISH WITHOUT CHARGE TO EACH RECEIPT HOLDER WHO
SO REQUESTS A COPY OF THE DEPOSIT AGREEMENT AND A COPY OR SUMMARY OF THE
PORTIONS OF THE AMENDED AND RESTATED DECLARATION OF TRUST AND/OR ARTICLES
SUPPLEMENTARY ESTABLISHING THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE,
PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF SHARES OR
SERIES THEREOF WHICH PRIME GROUP REALTY TRUST IS AUTHORIZED TO ISSUE AND THE
QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS OF
SUCH CLASS. ANY SUCH REQUEST IS TO BE ADDRESSED TO PRIME GROUP REALTY TRUST, 77
WEST WACKER DRIVE, SUITE 3900, CHICAGO, ILLINOIS 60601, ATTENTION:
______________.
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 the Uniform Gifts to Minors Act ___________________
(State)
Additional abbreviations may also be used though not in the above
list.
For value received, ____________________ hereby sell(s), assign(s) and
transfer(s) unto ______________________________
(Please insert social security or other
identifying number of assignee)
- --------------------------------------------------------------------------------
Please print or typewrite name and address including postal zip code of assignee
<PAGE>
_____________________ Depositary Shares represented by the within receipt and
all rights thereunder, and do hereby irrevocably constitute and appoint
_________________ Attorney to transfer said Depositary Shares on the books of
the within-named Depositary with full power of substitution in the premises.
Dated:
----------------------
- -------------------------------------
NOTICE. The signature(s) to this
assignment must correspond with the
name(s) as written upon the face of
this instrument in every
particular, without alteration or
enlargement or any change whatever.
<PAGE>
Exhibit 4.4
PRIME GROUP REALTY TRUST
-------------------------
-------------------------
Form of
Articles Supplementary
Classifying and Designating a Series of
Preferred Shares of Beneficial Interest as
__% Series ___ [Convertible]
Preferred Shares of Beneficial Interest and
Fixing Distribution and Other Preferences
and Rights of Such Series
-------------------------
-------------------------
Prime Group Realty Trust, a Maryland real estate investment trust (the
"TRUST"), hereby certifies to the State Department of Assessments and Taxation
of Maryland pursuant to section 8-203(b) of the Annotated Code of Maryland that:
FIRST: Pursuant to authority granted to the Board of Trustees of the Trust
by the Amended and Restated Declaration of Trust of the Trust (the
"DECLARATION"), the Board of Trustees has designated and classified __________
unissued preferred shares of beneficial interest, par value $0.01 per share, as
___% Series ___ [Convertible] Preferred Shares of Beneficial Interest, par value
$0.01 per share, and authorizing the issuance thereof.
SECOND: The following is a description of the ___% Series ___
[Convertible] Preferred Shares of Beneficial Interest, including the preferences
and other rights, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemption thereof:
Section 1. NUMBER OF SHARES AND DESIGNATION. This class of preferred
shares of beneficial interest shall be designated as "__% SERIES
___[CONVERTIBLE] PREFERRED SHARES OF BENEFICIAL INTEREST" and the number of
shares which shall constitute such series shall be _________ shares which number
may be decreased (but not below the aggregate number thereof then outstanding
and/or which have been reserved for issuance) from time to time by the Board of
Trustees.
Section 2. DEFINITIONS. For purposes of the Series ____ Preferred
Shares (as hereinafter defined), the following terms shall have the meanings
indicated:
"BOARD OF TRUSTEES" shall mean the Board of Trustees of the Trust or
any committee authorized by such Board of Trustees to perform any of its
responsibilities with respect to the Series ____ Preferred Shares.
"BUSINESS DAY" shall mean any day, other than a Saturday or Sunday,
that is neither a legal holiday nor a day on which banking institutions in
New York City, New York are authorized or required by law, regulation or
executive order to close.
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"COMMON SHARES" shall mean the Common Shares of Beneficial Interest,
par value $0.01 per share, of the Trust.
"FAIR MARKET VALUE" shall mean (except in SECTION 5(e)) as of any day
the average of the daily Current Market Prices of a Common Share on the
five (5) consecutive Trading Days selected by the Trust commencing not more
than 20 Trading Days before, and ending not later than, the earlier of the
day in question and the day before the "ex date," with respect to the
issuance or distribution requiring such computation. The term "EX DATE,"
when used with respect to any issuance or distribution, means the first day
on which the Common Shares trade regular way, without the right to receive
such issuance or distribution, on the exchange or in the market, as the
case may be, used to determine that day's Current Market Price.
"OPERATING PARTNERSHIP" shall mean Prime Group Realty, L.P., a
Delaware limited partnership.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SERIES ___ CALL DATE" shall mean the date specified in the notice to
holders required under SECTION 5(D) as the Series __ Call Date.
"SERIES ___ DIVIDEND PAYMENT DATE" shall mean (i) the _________ day of
each __________ with respect to the Series ____ Dividend Period commencing
on _________ of the then immediately preceding year, (ii) the _________ day
of each _________ with respect to the Series ____ Dividend Period
commencing on January 1 of such year, (ii) the _________ day of each
_________ with respect to the Series ____ Dividend Period commencing on
_________ of such year and (iv) the _________ day of each _________ with
respect to the Series ____ Dividend Period commencing on _________ of such
year.
"SERIES ___ DIVIDEND PERIODS" shall mean quarterly dividend periods
commencing on _________, _________, _________ and _________ of each year
and ending on and including the day preceding the first day of the next
succeeding Series ____ Dividend Period with respect to any Series ____
Preferred Shares (other than the initial Series ____ Dividend Period, which
shall commence on the Series ___ Issue Date and end on and include the last
day of the calendar quarter immediately following such Series ___ Issue
Date, and other than the Series ____ Dividend Period during which any
Series ____ Preferred Shares shall be redeemed pursuant to SECTION 5, which
shall end on and include the Series __ Call Date with respect to the Series
____ Preferred Shares being redeemed).
"SERIES ___ FULLY JUNIOR SHARES" shall mean the Common Shares, [the
_________ Preferred Shares] and any other class or series of shares of
beneficial interest of the Trust now or hereafter issued and outstanding
over which the Series ____ Preferred Shares have
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preference or priority in both (i) the payment of dividends and (ii) the
distribution of assets on any liquidation, dissolution or winding up of the
Trust.
"SERIES ___ ISSUE DATE" shall mean the date on which the Series ____
Preferred Shares are issued.
"SERIES ___ JUNIOR SHARES" shall mean the Common Shares, [the
_________ Preferred Shares and any other class or series of shares of
beneficial interest of the Trust now or hereafter issued and outstanding
over which the Series ____ Preferred Shares have preference or priority in
the payment of dividends or in the distribution of assets on any
liquidation, dissolution or winding up of the Trust.
"SERIES ___ PARITY SHARES" shall have the meaning set forth in SECTION
6(b).
"SERIES ___ PREFERRED SHARES" shall mean the Trust's ___% Series ___
[Convertible] Preferred Shares of Beneficial Interest, par value $0.01 per
share.
"SERIES ___ VOTING PREFERRED SHARES" shall have the meaning set forth
in SECTION 7.
"SET APART FOR PAYMENT" shall be deemed to include, without any other
action, the recording by the Trust in its accounting ledgers of any
accounting or bookkeeping entry which indicates, pursuant to a declaration
of dividends or other distribution by the Board of Trustees, the allocation
of funds to be so paid on any series or class of shares of beneficial
interest of the Trust; PROVIDED, HOWEVER, that if any funds for any class
or series of Series ____ Junior Shares or any class or series of shares of
beneficial interest ranking on a parity with the Series ____ Preferred
Shares as to the payment of dividends are placed in a separate account of
the Trust or delivered to a disbursing, paying or other similar agent, then
"SET APART FOR PAYMENT" with respect to the Series ____ Preferred Shares
shall mean placing such funds in a separate account or delivering such
funds to a disbursing, paying or other similar agent.
"TRADING DAY" shall mean any day on which the securities in question
are traded on the NYSE, or if such securities are not listed or admitted
for trading on the NYSE, on the principal national securities exchange on
which such securities are listed or admitted, or if not listed or admitted
for trading on any national securities exchange, on the National Market
System of NASDAQ, or if such securities are not quoted on such National
Market System, in the securities market in which the securities are traded.
"TRANSFER AGENT" shall mean the Trust, or such other agent or agents
of the Trust as may be designated by the Board of Trustees or their
designee as the transfer agent, registrar and dividend disbursing agent for
the Series ____ Preferred Shares.
Capitalized terms not otherwise defined herein have the meanings ascribed to
them in the Declaration.
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<PAGE>
Section 3. DIVIDENDS.
(a) Subject to the preferential rights of the holders of any
Preferred Shares that rank senior in the payment of dividends to the Series
____ Preferred Shares, the holders of Series ____ Preferred Shares shall be
entitled to receive, when, as and if declared by the Board of Trustees, out
of funds legally available for the payment of dividends, cumulative
preferential dividends payable in cash in an amount per share equal to an
annual rate of ___% of the per share liquidation preference of the Series
____ Preferred Shares (equivalent to $____ per Series ____ Preferred
Share). The dividends shall begin to accrue and shall be fully cumulative
from the first day of the applicable Series ____ Dividend Period, whether
or not in any Series ____ Dividend Period or Periods there shall be funds
of the Trust legally available for the payment of such dividends and
whether or not such dividends are authorized by the Board of Trustees, and
shall be payable quarterly, when, as and if declared by the Board of
Trustees, in arrears on Series ____ Dividend Payment Dates. Each such
dividend shall be payable in arrears to the holders of record of Series
____ Preferred Shares as they appear in the records of the Trust at the
close of business on such record date, not less than 10 nor more than 50
days preceding such Series ___ Dividend Payment Dates thereof, as shall be
fixed by the Board of Trustees. Accrued and unpaid dividends for any past
Series ____ Dividend Periods may be declared and paid at any time and for
such interim periods, without reference to any regular Series ____ Dividend
Payment Date, to holders of record on such date, not less than 10 nor more
than 50 days preceding the payment date thereof, as may be fixed by the
Board of Trustees. Any dividend payment made on Series ____ Preferred
Shares shall first be credited against the earliest accrued but unpaid
dividend due with respect to Series ____ Preferred Shares which remains
payable.
(b) The initial Series ____ Dividend Period for the Series ____
Preferred Shares will include a partial dividend for the period from the
Series ___ Issue Date until the last day of the calendar quarter
immediately following such Series ___ Issue Date. The amount of dividends
payable for such period, or any other period shorter than a full Series
____ Dividend Period, on the Series ____ Preferred Shares shall be computed
by dividing the number of days in such period by 365 and multiplying the
result by the product of the annual dividend rate (i.e., __%) multiplied by
the liquidation preference of the Series ____ Preferred Shares (i.e., $____
per Series ___ Preferred Share). The aggregate amount of dividends payable
in respect of the Series ____ Preferred Shares for each full Series ____
Dividend Period shall be computed by dividing (x) the product of the annual
dividend rate multiplied by the liquidation preference of the Series ____
Preferred Shares by (y) four (4). Holders of Series ____ Preferred Shares
shall not be entitled to any dividends, whether payable in cash, property
or shares, in excess of cumulative dividends, as herein provided, on the
Series ____ Preferred Shares. No interest, or sum of money in lieu of
interest, shall be payable in respect of any dividend payment or payments
on the Series ____ Preferred Shares which may be in arrears.
(c) So long as any Series ____ Preferred Shares are outstanding,
no dividends, except as described in the immediately following sentence,
shall be declared or paid or set
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apart for payment on any class or series of Series ____ Parity Shares for
any period unless full cumulative dividends have been or contemporaneously
are declared and paid or declared and a sum sufficient for the payment
thereof set apart for such payment on the Series ____ Preferred Shares for
all Series ____ Dividend Periods terminating on or prior to the dividend
payment date on such class or series of Series ____ Parity Shares. When
dividends are not paid in full or a sum sufficient for such payment is not
set apart, as aforesaid, all dividends declared upon Series ____ Preferred
Shares and all dividends declared upon any other class or series of Series
____ Parity Shares shall be declared ratably in proportion to the
respective amounts of dividends accumulated and unpaid on the Series ____
Preferred Shares and accumulated and unpaid on such Series ____ Parity
Shares.
(d) So long as any Series ____ Preferred Shares are outstanding,
no dividends (other than dividends or distributions paid solely in shares
of, or options, warrants or rights to subscribe for or purchase shares of,
Series ____ Fully Junior Shares) shall be declared or paid or set apart for
payment or any other distribution shall be declared or made or set apart
for payment upon Series ____ Junior Shares, nor shall any Series ____
Junior Shares be redeemed, purchased or otherwise acquired (other than a
redemption, purchase or other acquisition of Common Shares made for
purposes of an employee incentive or benefit plan of the Trust or any
subsidiary) for any consideration (or any moneys be paid to or made
available for a sinking fund for the redemption of any Series ____ Junior
Shares) by the Trust, directly or indirectly (except by conversion into or
exchange for Series ____ Fully Junior Shares), unless in each case (i) the
full cumulative dividends on all outstanding Series ____ Preferred Shares
and any other Series ____ Parity Shares of the Trust shall have been or
contemporaneously are declared and paid or declared and set apart for
payment for all past Series ____ Dividend Periods with respect to the
Series ____ Preferred Shares and all past dividend periods with respect to
such Series ____ Parity Shares and (ii) sufficient funds shall have been or
contemporaneously are declared and paid or declared and set apart for the
payment of the dividend for the then current Series ____ Dividend Period
with respect to the Series ____ Preferred Shares and the then current
dividend period with respect to such Series ____ Parity Shares.
(e) No distributions on Series ____ Preferred Shares shall be
declared by the Board of Trustees or paid or set apart for payment by the
Trust at such time as the terms and provisions of any agreement of the
Trust, including any agreement relating to its indebtedness, prohibits such
declaration, payment or setting apart for payment or provides that such
declaration, payment or setting apart for payment would constitute a breach
thereof or a default thereunder, or if such declaration or payment shall be
restricted or prohibited by law.
Section 4. LIQUIDATION PREFERENCE.
(a) In the event of any liquidation, dissolution or winding up
of the Trust, whether voluntary or involuntary, subject to the prior
preferences and other rights of any series of shares of beneficial interest
ranking senior to the Series ____ Preferred Shares upon
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<PAGE>
liquidation, distribution or winding up of the Trust, before any payment or
distribution of the assets of the Trust (whether capital or surplus) shall
be made to or set apart for the holders of Series ____ Junior Shares, the
holders of the Series ____ Preferred Shares shall be entitled to receive
___________ Dollars ($______) (the "LIQUIDATION PREFERENCE") per Series
____ Preferred Share plus an amount equal to all dividends (whether or not
earned or declared) accrued and unpaid thereon to the date of final
distribution to such holders; but such holders shall not be entitled to any
further payment. If, upon any liquidation, dissolution or winding up of
the Trust, the assets of the Trust, or proceeds thereof, distributable
among the holders of the Series ____ Preferred Shares shall be insufficient
to pay in full the preferential amount aforesaid and liquidating payments
on any other shares of any class or series of Series ____ Parity Shares,
then such assets, or the proceeds thereof, shall be distributed among the
holders of Series ____ Preferred Shares and any such other Series ____
Parity Shares ratably in accordance with the respective amounts that would
be payable on such Series ____ Preferred Shares and any such other Series
____ Parity Shares if all amounts payable thereon were paid in full. For
the purposes of this SECTION 4, (i) a consolidation or merger of the Trust
with one or more corporations, real estate investment trusts or other
entities, (ii) a sale, lease or conveyance of all or substantially all of
the Trust's property or business or (iii) a statutory share exchange shall
not be deemed to be a liquidation, dissolution or winding up, voluntary or
involuntary, of the Trust.
(b) Subject to the rights of the holders of shares of any series
or class or classes of shares of beneficial interest ranking on a parity
with or prior to the Series ____ Preferred Shares upon liquidation,
dissolution or winding up, upon any liquidation, dissolution or winding up
of the Trust, after payment shall have been made in full to the holders of
the Series ____ Preferred Shares, as provided in this SECTION 4, the
holders of Series ____ Preferred Shares shall have no other claim to the
remaining assets of the Trust and any other series or class or classes of
Series ____ Junior Shares shall, subject to the respective terms and
provisions (if any) applying thereto, be entitled to receive any and all
assets remaining to be paid or distributed, and the holders of the Series
____ Preferred Shares shall not be entitled to share therein.
Section 5. REDEMPTION AT THE OPTION OF THE TRUST.
(a) The Series ____ Preferred Shares shall not be redeemable by
the Trust prior to ______, 2___. On and after ______, 2___, the Trust, at
its option, may redeem the Series ____ Preferred Shares, in whole at any
time or from time to time in part out of funds legally available therefor
at a redemption price payable in cash equal to 100% of the Liquidation
Preference per Series ____ Preferred Share (plus all accumulated, accrued
and unpaid dividends as provided below). [The redemption price of the
Series ____ Preferred Shares (other than any portion thereof consisting of
accrued and unpaid dividends) shall be paid solely from the proceeds of the
issuance and sale by the Trust of other capital shares of beneficial
interest of the Trust and not from any other source. For purposes of the
preceding sentence, "CAPITAL SHARES OF BENEFICIAL INTEREST" means any
equity securities (including Common Shares and Preferred Shares), shares,
interests, participations or other ownership
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<PAGE>
interests (however designated) and any rights (other than debt securities
convertible into or exchangeable for equity securities) or options to
purchase any of the foregoing.]
(b) Upon any redemption of Series ____ Preferred Shares pursuant
to this SECTION 5, the Trust shall pay all accrued and unpaid dividends, if
any, thereon to the Series ____ Call Date, without interest, except that if
the Series ____ Call Date falls after a dividend payment record date and
prior to the corresponding Series ____ Dividend Payment Date, then each
holder of Series ____ Preferred Shares at the close of business on such
dividend payment record date shall be entitled to the dividend payable on
such shares on the corresponding Series ____ Dividend Payment Date
notwithstanding any redemption of such shares before such Series ____
Dividend Payment Date. Except as provided above, the Trust shall make no
payment or allowance for unpaid dividends, whether or not in arrears, on
Series ____ Preferred Shares called for redemption.
(c) If full cumulative dividends on the Series ____ Preferred
Shares and any other class or series of Series ____ Parity Shares of the
Trust have not been declared and paid or declared and set apart for
payment, the Series ____ Preferred Shares may not be redeemed under this
SECTION 5 in part and the Trust may not purchase or acquire Series ____
Preferred Shares, otherwise than pursuant to a purchase or exchange offer
made on the same terms to all holders of Series ____ Preferred Shares.
(d) Notice of the redemption of any Series ____ Preferred Shares
under this SECTION 5 shall be mailed by first-class mail to each holder of
record of Series ____ Preferred Shares to be redeemed at the address of
each such holder as shown on the Trust's records, not less than 30 nor more
than 90 days prior to the Series ____ Call Date. Neither the failure to
mail any notice required by this paragraph (d), nor any defect therein or
in the mailing thereof, to any particular holder, shall affect the
sufficiency of the notice or the validity of the proceedings for redemption
with respect to the other holders. Each such mailed notice shall state, as
appropriate: (1) the Series ____ Call Date; (2) the number of Series ____
Preferred Shares to be redeemed and, if fewer than all the shares held by
such holder are to be redeemed, the number of such shares to be redeemed
from such holder; (3) the redemption price; (4) the place or places at
which certificates for such shares are to be surrendered; (5) [the
then-current Conversion Price; and (6)] that dividends on the shares to be
redeemed shall cease to accrue on such Series ____ Call Date except as
otherwise provided herein. Notice having been mailed as aforesaid, from
and after the Series ____ Call Date (unless the Trust shall fail to make
available an amount of cash necessary to effect such redemption), (i)
except as otherwise provided herein, dividends on the Series ____ Preferred
Shares so called for redemption shall cease to accrue, (ii) such shares
shall no longer be deemed to be outstanding, and (iii) all rights of the
holders thereof as holders of Series ____ Preferred Shares of the Trust
shall cease (except the right to receive the cash payable upon such
redemption, without interest thereon, upon surrender and endorsement of
their certificates if so required and to receive any dividends payable
thereon). The Trust's obligation to provide cash in accordance with the
preceding sentence shall be deemed fulfilled if, on or before the Series
____ Call Date, the Trust shall deposit with a bank or trust company (which
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may be an affiliate of the Trust) that has an office in the Borough of
Manhattan, City of New York, and that has, or is an affiliate of a bank or
trust company that has, capital and surplus of at least $50,000,000 cash,
necessary for such redemption, in trust, with irrevocable instructions that
such cash be applied to the redemption of the Series ____ Preferred Shares
so called for redemption. No interest shall accrue for the benefit of the
holders of Series ____ Preferred Shares to be redeemed on any cash so set
aside by the Trust. Subject to applicable escheat laws, any such cash
unclaimed at the end of two years from the Series ____ Call Date shall
revert to the general funds of the Trust, after which reversion the holders
of such shares so called for redemption shall look only to the general
funds of the Trust for the payment of such cash.
As promptly as practicable after the surrender in accordance with such
notice of the certificates for any such shares so redeemed (properly
endorsed or assigned for transfer, if the Trust shall so require and if the
notice shall so state), such shares shall be exchanged for any cash
(without interest thereon) for which such shares have been redeemed. If
fewer than all the outstanding Series ____ Preferred Shares are to be
redeemed, shares to be redeemed shall be selected by the Trust from
outstanding Series ____ Preferred Shares not previously called for
redemption pro rata (as nearly as may be), by lot or by any other method
determined by the Trust in its sole discretion to be equitable. If fewer
than all the Series ____ Preferred Shares represented by any certificate
are redeemed, then new certificates representing the unredeemed shares
shall be issued without cost to the holder thereof.
[(e) Notwithstanding anything herein to the contrary, beginning
on _____, ___ and ending on ____________, ____________,the Trust, at its
option, may redeem all, but not less than all, of the Series ___Preferred
Shares at a premium (the "SPECIAL REDEMPTION PRICE") calculated to result
in a total internal rate of return to the holder (including the receipt of
dividends and calculated on an annual compounded basis as if the holder had
owned the shares since the Series ____ Issue Date) of ___%. The Special
Redemption Price may be paid, at the Trust's option, in any combination of
(i) cash and (ii) Common Shares valued at Fair Market Value; PROVIDED, that
the cash portion of the Special Redemption Price shall equal at least 75%
of the Special Redemption Price. For purposes of this SECTION 5(e), "FAIR
MARKET VALUE" shall mean the Weighted Average Trading Price for the Common
Shares for the 20 Trading Days preceding the date of the special redemption
(the "SPECIAL REDEMPTION CALL DATE"). For purposes of this Section 5(e),
Weighted Average Trading Price shall mean, for any period, the number
obtained by dividing (i) the sum of the products, for each sale of Common
Shares on each Trading Day in such period, of (a) the sale price per Common
Share and (b) the number of Common Shares sold by (ii) the total number of
Common Shares sold during such period.
Notice of the redemption of any Series ___ Preferred Shares under this
SECTION 5(E) shall be mailed by first-class mail to each holder of record
of Series ___ Preferred Shares to be redeemed at the address of each such
holder as shown on the Trust's records, not less than 30 nor more than 90
days prior to the Special Redemption Call Date. Neither the failure to
mail any notice required by this paragraph (e), nor any defect therein or
in the mailing
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thereof, to any particular holder, shall affect the sufficiency of the
notice or the validity of the proceedings for redemption with respect to
the other holders. Each such mailed notice shall state, as appropriate:
(1) the Special Redemption Call Date; (2) the Special Redemption Price
(including the amount of the Special Redemption Price consisting of cash
and the amount of the Special Redemption Price consisting of Common Shares,
together with calculations supporting the determination of the number
Common Shares constituting a portion of the Special Redemption Price); (3)
the place or places at which certificates for such shares are to be
surrendered; and (4) that dividends on the shares to be redeemed shall
cease to accrue on such Series ____ Call Date except as otherwise provided
herein. Notice having been mailed as aforesaid, from and after the Special
Redemption Call Date (unless the Trust shall fail to make available an
amount of cash necessary to effect such redemption), (i) except as
otherwise provided herein, dividends on the Series ___ Preferred Shares so
called for redemption shall cease to accrue, (ii) such shares shall no
longer be deemed to be outstanding and (iii) all rights of the holders
thereof as holders of Series ___ Preferred Shares shall cease (except the
right to receive the Special Redemption Price, without interest thereon,
upon surrender and endorsement of their certificates if so required). The
Trust's obligation to provide cash and Common Shares in accordance with the
preceding sentence shall be deemed fulfilled if, on or before the Special
Redemption Call Date, the Trust shall deposit with a bank or trust company
(which may be an affiliate of the Trust) that has an office in the Borough
of Manhattan, City of New York, and that has, or is an affiliate of a bank
or trust company that has, capital and surplus of at least $50,000,000,
necessary for such redemption, in trust, with irrevocable instructions that
such cash and/or Common Shares be applied to the redemption of the Series
___ Preferred Shares so called for redemption. No interest shall accrue
for the benefit of the holders of Series ___ Preferred Shares to be
redeemed on any cash so set aside by the Trust. Subject to applicable
escheat laws, any such cash or Common Shares unclaimed at the end of two
years from the Special Redemption Call Date shall revert to the general
funds of the Trust, after which reversion the holders of such shares so
called for redemption shall look only to the general funds of the Trust for
the payment of such cash or Common Shares.
As promptly as practicable after the surrender in accordance with such
notice of the certificates for any such shares so redeemed (properly
endorsed or assigned for transfer, if the Trust shall so require and if the
notice shall so state), such shares shall be exchanged for any cash
(without interest thereon) and Common Shares for which such shares have
been redeemed.]
Section 6. RANKING. Any class or series of shares of beneficial
interest of the Trust shall be deemed to rank:
(a) prior to the Series ____ Preferred Shares, as to the payment of
dividends and as to distribution of assets upon liquidation, dissolution or
winding up, if the holders of such class or series shall be entitled to the
receipt of dividends or of amounts distributable upon liquidation, dissolution
or winding up, as the case may be, in preference or priority to the holders of
Series ____ Preferred Shares;
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(b) on a parity with the Series ____ Preferred Shares, as to the payment
of dividends and as to distribution of assets upon liquidation, dissolution or
winding up, whether or not the dividend rates, dividend payment dates or
redemption or liquidation prices per share thereof shall be different from those
of the Series ____ Preferred Shares, if the holders of such class or series and
the Series ____ Preferred Shares shall be entitled to the receipt of dividends
and of amounts distributable upon liquidation, dissolution or winding up in
proportion to their respective amounts of accrued and unpaid dividends per share
or liquidation preferences, without preference or priority one over the other
("SERIES ____ PARITY SHARES");
(c) junior to the Series ____ Preferred Shares, as to the payment of
dividends or as to the distribution of assets upon liquidation, dissolution or
winding up, if such class or series [(which includes the ________ Preferred
Shares])] shall be Series ____ Junior Shares; and
(d) junior to the Series ____ Preferred Shares, as to the payment of
dividends and as to the distribution of assets upon liquidation, dissolution or
winding up, if such class or series [(which includes the ________ Preferred
Shares)] shall be Series ____ Fully Junior Shares.
Section 7. VOTING. If and whenever ___ consecutive quarterly dividends
payable on the Series ____ Preferred Shares or any series or class of Series
____ Parity Shares having similar voting rights shall be in arrears (which
shall, with respect to any such quarterly dividend, mean that any such dividend
has not been paid in full), whether or not earned or declared, the Board of
Trustees of the Trust shall amend the Bylaws of the Trust (unless the Bylaws had
then been previously amended to increase the number of trustees then
constituting the Board of Trustees pursuant to this SECTION 7) in order that the
number of trustees then constituting the Board of Trustees shall be increased by
two and the holders of Series ____ Preferred Shares, together with the holders
of shares of every other series of Series ____ Parity Shares (any such other
series, the "SERIES ____ VOTING PREFERRED SHARES"), voting as a single class
regardless of series, shall be entitled to elect the two additional trustees to
serve on the Board of Trustees at any annual meeting of shareholders or special
meeting held in place thereof, or at a special meeting of the holders of the
Series ____ Preferred Shares and the Series ____ Voting Preferred Shares called
as hereinafter provided. Whenever all arrears in dividends on the Series ____
Preferred Shares and the Series ____ Voting Preferred Shares then outstanding
shall have been paid and dividends thereon for the current quarterly dividend
period shall have been paid or declared and set apart for payment, then the
right of the holders of the Series ____ Preferred Shares and the Series ____
Voting Preferred Shares to elect such additional trustees shall cease (but
subject always to the same provision for the vesting of such voting rights in
the case of any similar future arrearage in quarterly dividends), and the terms
of office of all persons elected as trustees by the holders of the Series ____
Preferred Shares and the Series ____ Voting Preferred Shares shall,
notwithstanding the assignment of such trustees to any class pursuant to Section
2.2(a) of the Declaration, forthwith terminate and the number of the Board of
Trustees shall be reduced accordingly. At any time after such voting power
shall have been so vested in the holders of Series ____ Preferred Shares and the
Series ____ Voting Preferred Shares, the Secretary of the Trust may, and upon
the written request of any holder of Series ____ Preferred Shares (addressed to
the Secretary at the principal office of the Trust) shall, call a special
meeting of the holders of the Series ____ Preferred Shares and of the Series
____ Voting Preferred Shares for the election of the trustees
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to be elected by them as herein provided, such call to be made by notice similar
to that provided in the Bylaws of the Trust for a special meeting of the
shareholders or as required by law. If any such special meeting required to be
called as above provided shall not be called by the Secretary within 20 days
after receipt of any such request, then any holder of Series ____ Preferred
Shares may call such meeting, upon the notice above provided, and for that
purpose shall have access to the records of the Trust. The trustees elected at
any such special meeting shall, notwithstanding the assignment of such Trustees
to any class pursuant to Section 2.2(a) of the Declaration, hold office until
the next annual meeting of the shareholders or special meeting held in lieu
thereof if such office shall not have previously terminated as above provided.
If any vacancy shall occur among the trustees elected by the holders of the
Series ____ Preferred Shares and the Series ____ Voting Preferred Shares, a
successor shall be elected by the Board of Trustees, upon the nomination of the
then-remaining trustee elected by the holders of the Series ____ Preferred
Shares and the Series ____ Voting Preferred Shares or the successor of such
remaining trustee, to serve until the next annual meeting of the shareholders or
special meeting held in place thereof if such office shall not have previously
terminated as provided above.
So long as any Series ____ Preferred Shares are outstanding, in addition to
any other vote or consent of shareholders required by law or by the Declaration,
the affirmative vote of at least 66 2/3% of the votes entitled to be cast by the
holders of the Series ____ Preferred Shares given in person or by proxy shall be
necessary for effecting or validating:
(a) Any amendment, alteration or repeal of any of the provisions of the
Declaration or these Articles Supplementary that materially and adversely
affects the voting powers, rights or preferences of the holders of the Series
____ Preferred Shares; PROVIDED, HOWEVER, that the amendment of the provisions
of the Declaration so as to authorize or create or to increase the authorized
amount of, any Series ____ Fully Junior Shares, Series ____ Junior Shares that
are not senior in any respect to the Series ____ Preferred Shares or any Series
____ Parity Shares shall not be deemed to materially adversely affect the voting
powers, rights or preferences of the holders of Series ____ Preferred Shares; or
(b) A share exchange that affects the Series ____ Preferred Shares, a
consolidation with or merger of the Trust into another entity, or a
consolidation with or merger of another entity into the Trust, unless in each
such case each Series ____ Preferred Share (i) shall remain outstanding without
a material and adverse change to its terms and rights or (ii) shall be converted
into or exchanged for cumulative redeemable preferred shares of the surviving
entity having preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications and term or conditions
of redemption thereof identical to that of a Series ____ Preferred Share (except
for changes that do not materially and adversely affect the holders of the
Series ____ Preferred Shares);
PROVIDED, HOWEVER, that no such vote of the holders of Series ____ Preferred
Shares shall be required if, at or prior to the time when such amendment,
alteration or repeal is to take effect, or when the issuance of any such prior
shares or convertible security is to be made, as the case may be, provision
-11-
<PAGE>
is made for the redemption of all Series ____ Preferred Shares at the time
outstanding to the extent such redemption is authorized by SECTION 5 of these
Articles Supplementary.
For purposes of the foregoing provisions of this SECTION 7, each Series
____ Preferred Share shall have one (1) vote per share, except that when any
other series of Preferred Shares shall have the right to vote with the Series
____ Preferred Shares as a single class on any matter, then the Series ____
Preferred Shares and such other series shall have with respect to such matters
one (1) vote per $_____ of stated liquidation preference. Except as otherwise
required by applicable law or as expressly set forth herein, the Series ____
Preferred Shares shall not have any voting rights, and the consent of the
holders thereof shall not be required for the taking of any Trust action.
[Section 8. CONVERSION. [Insert any applicable conversion provisions.]
Section 9. RECORD HOLDERS. The Trust and the Transfer Agent may deem
and treat the record holder of any Series ____ Preferred Shares as the true and
lawful owner thereof for all purposes, and neither the Trust nor the Transfer
Agent shall be affected by any notice to the contrary.
THIRD: The classification of authorized but unissued shares of beneficial
interests as set forth in these Articles Supplementary to be the act of the
Trust does not increase the authorized capital of the Trust or the aggregate par
value thereof.
FOURTH. These Articles Supplementary have been approved by the majority of
the Board of Trustees of the Trust in the manner prescribed by the Declaration
and Maryland law.
-12-
<PAGE>
IN WITNESS WHEREOF, the undersigned, the _____________________________ of
the Trust, acknowledges these Articles Supplementary to be the act of the Trust
and, as to all matters or facts required to be verified under oath, acknowledges
that, to the best of his knowledge, information and belief, the matters and
facts set forth herein are true in all material respects and that this statement
is made under the penalties of perjury. These Articles Supplementary have been
executed under seal in the name of the Trust by its ___________________________
_________________________________ and attested by its Secretary this ___ day of
_____,_____.
[SEAL] PRIME GROUP REALTY TRUST
By:
--------------------------------
Name:
-------------------------
Title:
-------------------------
Attest:
By:
-----------------------------
Name:
-----------------------
Title:
----------------------
-13-
<PAGE>
Exhibit 4.5
- --------------------------------------------------------------------------------
[DEBT SECURITIES] [SERIES __ PREFERRED SHARES OF BENEFICIAL
INTEREST] [COMMON SHARES OF BENEFICIAL INTEREST] [DEPOSITARY
SHARES] WARRANT AGREEMENT
dated as of ________ __, ____
between
PRIME GROUP REALTY TRUST
and
[NAME OF WARRANT AGENT], as Warrant Agent
--------------------------------------
[Debt Securities] [Series __ Preferred Shares of
Beneficial Interest] [Common Shares of Beneficial Interest]
[Depositary Shares] Warrants
Expiring ________ __, ____
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
PARTIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I
ISSUANCE OF WARRANTS AND FORM, EXECUTION,
DELIVERY AND REGISTRATION OF WARRANT CERTIFICATES
SECTION 1.01. Issuance of Warrants . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.02. Form, Execution and Delivery of Warrant Certificates . . . . . 3
SECTION 1.03. Transfer of Warrants . . . . . . . . . . . . . . . . . . . . . 5
SECTION 1.04. Lost, Stolen, Mutilated or Destroyed Warrant Certificates. . . 6
SECTION 1.05. Cancellation of Warrant Certificates . . . . . . . . . . . . . 7
SECTION 1.06. Treatment of Holders [If Warrants are to be issued in
Book-Entry form: and Beneficial Owners] of
Warrant Certificates . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE II
EXERCISE PRICE, DURATION, EXERCISE AND CALL OF WARRANTS
SECTION 2.01. Exercise Price . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2.02. Duration of Warrants . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2.03. Exercise of Warrants . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2.04. Adjustment Under Certain Circumstances . . . . . . . . . . . .10
SECTION 2.05. Call of the Warrants . . . . . . . . . . . . . . . . . . . . .16
ARTICLE III
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS
[IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM:
AND BENEFICIAL OWNERS] OF WARRANTS
SECTION 3.01. No Rights as Holders of Warrant Securities Conferred by
Warrants or Warrant Certificates . . . . . . . . . . . . . . .17
</TABLE>
(i)
<PAGE>
<TABLE>
<S> <C>
SECTION 3.02. Holder [If Warrants are to be issued in Book-Entry form:
and Beneficial Owner] of Warrant May Enforce Rights. . . . . .17
ARTICLE IV
CONCERNING THE WARRANT AGENT
SECTION 4.01. Warrant Agent. . . . . . . . . . . . . . . . . . . . . . . . .17
SECTION 4.02. Limitations on Warrant Agent's Obligations . . . . . . . . . .17
SECTION 4.03. Compliance With Applicable Laws. . . . . . . . . . . . . . . .19
SECTION 4.04. Resignation and Appointment of Successor . . . . . . . . . . .19
ARTICLE V
MISCELLANEOUS
SECTION 5.01. Amendments . . . . . . . . . . . . . . . . . . . . . . . . . .21
SECTION 5.02. Merger, Consolidation, Sale, Transfer or Conveyance. . . . . .22
SECTION 5.03. Notices and Demands to the Company and Warrant Agent . . . . .23
SECTION 5.04. Addresses. . . . . . . . . . . . . . . . . . . . . . . . . . .23
SECTION 5.05. GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . . .23
SECTION 5.06. Delivery of Prospectus . . . . . . . . . . . . . . . . . . . .23
SECTION 5.07. Obtaining of Governmental Approvals. . . . . . . . . . . . . .23
SECTION 5.08. Payment of Taxes . . . . . . . . . . . . . . . . . . . . . . .24
SECTION 5.09. Benefits of Warrant Agreement. . . . . . . . . . . . . . . . .24
SECTION 5.10. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . .24
SECTION 5.11. Severability . . . . . . . . . . . . . . . . . . . . . . . . .24
SECTION 5.12. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . .24
SECTION 5.13. Inspection of Agreement. . . . . . . . . . . . . . . . . . . .24
SECTION 5.14. Board of Trustees Action; No Liability of Trustees,
Officers, Employees or Shareholders. . . . . . . . . . . . . .24
SECTION 5.15. Warrant Holders Not Shareholders . . . . . . . . . . . . . . .25
</TABLE>
EXHIBITS
EXHIBIT A. Form of Warrant Certificate
(ii)
<PAGE>
[DEBT SECURITIES] [SERIES __ PREFERRED SHARES OF BENEFICIAL INTEREST]
[COMMON SHARES OF BENEFICIAL INTEREST] [DEPOSITARY SHARES] WARRANT AGREEMENT
[DEBT SECURITIES] [[SERIES __ PREFERRED SHARES OF BENEFICIAL INTEREST]
[COMMON SHARES OF BENEFICIAL INTEREST] [DEPOSITARY SHARES] WARRANT AGREEMENT,
dated as of ________ __, ____ (as modified, amended or supplemented, this
"AGREEMENT"), between PRIME GROUP REALTY TRUST, a Maryland real estate
investment trust (the "COMPANY") and [NAME OF WARRANT AGENT], a
_________________, as Warrant Agent (the "WARRANT AGENT").
W I T N E S S E T H:
[IF OFFER CONSISTS OF DEBT SECURITIES WITH WARRANTS AND/OR WARRANTS TO
PURCHASE DEBT SECURITIES: WHEREAS, the Company has entered into an indenture
(the "[SENIOR] [SUBORDINATED] INDENTURE") dated as of ______________ between the
Company and [Name of Trustee], as trustee (the "[SENIOR] [SUBORDINATED]
TRUSTEE"), providing for the issuance from time to time of its unsecured
[senior] [subordinated] debentures, notes or other evidences of indebtedness
(the "[SENIOR] [SUBORDINATED] DEBT SECURITIES"), to be issued in one or more
series as provided in the [Senior] [Subordinated] Indenture; [IF WARRANT
SECURITIES ARE NOT UNDER SAME INDENTURE AS DEBT SECURITIES TO WHICH THEY ARE
ATTACHED: and an Indenture (the "[SENIOR] [SUBORDINATED] INDENTURE," the Senior
and Subordinated Indentures being referred to collectively as the "INDENTURES")
dated as of _________________ between the Company and [Name of Trustee], as
trustee (the "[SENIOR] [SUBORDINATED] TRUSTEE," (the Senior and Subordinated
Trustees being referred to collectively, as the "TRUSTEES"), providing for the
issuance from time to time of its [senior] [subordinated] debentures, notes or
other evidences of indebtedness (the "[SENIOR] [SUBORDINATED] DEBT SECURITIES,"
the Senior and Subordinated Debt Securities being referred to collectively as
the "DEBT SECURITIES"), to be issued in one or more series as provided in the
[Senior] [Subordinated] Indenture]; and
[IF SECURITIES AND WARRANTS ARE TO BE OFFERED TOGETHER: WHEREAS, the
Company proposes to sell [title of Securities being offered] (the "SECURITIES")
together with warrants (each, a "WARRANT") representing the right to purchase
[title of Securities purchasable upon exercise of Warrants] [IF WARRANTS FOR
DEPOSITARY SHARES ARE TO BE OFFERED: , each representing a 1/__th interest in a
share of [title of securities represented by Depositary Shares]] (the "WARRANT
SECURITIES" [IF WARRANTS FOR DEPOSITARY SHARES ARE TO BE OFFERED: , which term
shall also refer, as appropriate, to such [title of securities represented by
Depositary Shares]), such warrant certificates and other warrant certificates
issued pursuant to this Agreement being herein called the "WARRANT
CERTIFICATES"; and]
<PAGE>
[IF WARRANTS ARE TO BE OFFERED SEPARATELY: WHEREAS, the Company proposes to
sell warrants (each, a "WARRANT") representing the right to purchase [title of
Securities purchasable upon exercise of Warrants] [IF WARRANTS FOR DEPOSITARY
SHARES ARE TO BE OFFERED: , each representing a 1/__th interest in a share of
[title of securities represented by the Depositary Shares]] (the "WARRANT
SECURITIES" [IF WARRANTS FOR DEPOSITARY SHARES ARE TO BE OFFERED: , which term
shall also refer, as appropriate, to such [title of securities represented by
the Depositary Shares]), such warrant certificates and other warrant
certificates issued pursuant to this Agreement being herein called the "WARRANT
CERTIFICATES"; and]
WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing so to act, in connection with the
issuance, transfer, exchange, exercise and cancellation of the Warrants, and the
Company wishes to set forth in this Agreement, among other things, the
provisions of the Warrants, the form of the Warrant Certificates evidencing the
Warrants and the terms and conditions upon which the Warrants may be issued,
transferred, exchanged, exercised and canceled;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
ISSUANCE OF WARRANTS AND FORM, EXECUTION,
DELIVERY AND REGISTRATION OF WARRANT CERTIFICATES
SECTION 1.01. ISSUANCE OF WARRANTS. Each Warrant shall represent the
right, subject to the provisions contained herein and therein, to purchase
[________] Warrant Securities [in the aggregate principal amount of $_____] at
the Exercise Price set forth in SECTION 2.01. [IF SECURITIES AND WARRANTS ARE
TO BE OFFERED TOGETHER: Warrants shall be issued in units with the Securities
[IF WARRANTS ARE NOT IMMEDIATELY DETACHABLE: and shall not be separately
transferable [UNLESS WARRANTS ARE NOT DETACHABLE: before ________ __, ____ (the
"DETACHMENT DATE")]].] [IF WARRANTS ARE TO BE OFFERED SEPARATELY: Warrants
shall be issued as a separate security and shall be transferable from and after
the date of issuance.] [IF WARRANTS ARE TO BE OFFERED IN BOOK-ENTRY FORM:
[All] [A portion] of the Warrants shall initially be represented by one or more
Book-Entry certificates (each, a "BOOK-ENTRY WARRANT CERTIFICATE").] [IF
SECURITIES AND WARRANTS ARE TO BE OFFERED TOGETHER AND IN DEFINITIVE FORM: Each
Warrant Certificate included in such a unit shall evidence [_______] Warrants
for each [$_____ principal amount of] [_______] Securities included in such
unit.] [IF WARRANTS ARE TO BE OFFERED SEPARATELY AND IN DEFINITIVE FORM: Each
Warrant Certificate shall evidence [_______] Warrants.]
2
<PAGE>
SECTION 1.02. FORM, EXECUTION AND DELIVERY OF WARRANT CERTIFICATES.
(a) One or more Warrant Certificates evidencing Warrants to purchase not
more than [____] [$_______ in aggregate principal amount of] Warrant Securities
(except as provided in SECTIONS 1.03, 1.04 and 2.03(e)) may be executed by the
Company and delivered to the Warrant Agent upon the execution of this Warrant
Agreement or from time to time thereafter.
(b) Each Warrant Certificate, whenever issued, shall be in registered form
substantially in the form set forth in EXHIBIT A hereto, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Agreement. [IF WARRANTS ARE ISSUED IN BOOK-ENTRY FORM: Each
Book-Entry Warrant Certificate shall bear such legend or legends as may be
required by the Depository in order for it to accept the Warrants for its
book-entry settlement system.] Each Warrant Certificate shall be printed,
lithographed, typewritten, mimeographed or engraved or otherwise reproduced in
any other manner as may be approved by the officers executing the same (such
execution to be conclusive evidence of such approval) and may have such letters,
numbers or other marks of identification or designation and such legends or
endorsements printed, lithographed or engraved thereon as the officers of the
Company executing the same may approve (such execution to be conclusive evidence
of such approval) and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto, or with any regulation of any stock exchange
on which the Warrants [IF SECURITIES AND WARRANTS ARE TO BE OFFERED TOGETHER: ,
the Securities] or the Warrant Securities may be listed, or to conform to usage.
Each Warrant Certificate shall be signed on behalf of the Company by its
Chairman of the Board, Chief Executive Officer, President, Chief Financial
Officer or any Vice President. The signature of any such officer on any Warrant
Certificate may be manual or facsimile. Each Warrant Certificate, when so
signed on behalf of the Company, shall be delivered to the Warrant Agent
together with an order for the countersignature and delivery of such Warrants.
(c) The Warrant Agent shall, upon receipt of any Warrant Certificate duly
executed on behalf of the Company, countersign such Warrant Certificate and
deliver such Warrant Certificate to or upon the order of the Company. Each
Warrant Certificate shall be dated the date of its countersignature.
(d) No Warrant Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose, and no Warrant evidenced
thereby may be exercised, unless such Warrant Certificate has been countersigned
by the manual signature of the Warrant Agent. Such signature by the Warrant
Agent upon any Warrant Certificate executed by the Company shall be conclusive
evidence that such Warrant Certificate has been duly issued under the terms of
this Agreement.
3
<PAGE>
(e) If any officer of the Company who has signed any Warrant Certificate
either manually or by facsimile signature shall cease to be such officer before
such Warrant Certificate shall have been countersigned and delivered by the
Warrant Agent, such Warrant Certificate nevertheless may be countersigned and
delivered as though the person who signed such Warrant Certificate had not
ceased to be such officer of the Company; and any Warrant Certificate may be
signed on behalf of the Company by such persons as, at the actual date of the
execution of such Warrant Certificate, shall be the proper officers of the
Company as specified in this SECTION 1.02, regardless of whether at the date of
the execution of this Agreement any such person was such officer.
(f) The Holders shall [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: ,
except as stated below with respect to Warrants evidenced by a Book-Entry
Warrant Certificate,] be entitled to receive Warrants in physical, certificated
form.
[IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: (g) A Holder shall not be
entitled to receive Warrants in physical, certificated form unless (i) the
Depositary has notified the Company that it is unwilling or unable to continue
as Depositary for such Book-Entry Warrant Certificate or if at any time it has
ceased to be a clearing agency registered under the Securities Exchange Act of
1934, as amended, and the Company does not appoint a successor within 90 days or
(ii) the Company at any time shall determine to have the Warrants represented by
definitive Warrant Certificates and shall execute and deliver to the Warrant
Agent a written order signed in the name of the Company by its Chairman of the
Board, Chief Executive Officer, President, Chief Financial Officer or Vice
President, stating that the Company wishes to issue Warrants in definitive form
in exchange for such Book-Entry Warrant Certificate. In any such instance, and
in accordance with the provisions of this Agreement, each Holder shall be
entitled to have registered in its name the number of Warrants in definitive
form equivalent to such Holder's beneficial interest in such Book-Entry Warrant
Certificate and shall receive physical delivery of definitive Warrant
Certificates representing such Warrants from the Depositary.
(h) A Book-Entry Warrant Certificate may be exchanged for a new Book-Entry
Warrant Certificate, or one or more new Book-Entry Warrant Certificates may be
issued, to reflect the issuance by the Company of additional Warrants. To
effect such an exchange, the Company shall deliver to the Warrant Agent one or
more new Book-Entry Warrant Certificates duly executed on behalf of the Company
as provided in SECTION 1.02. The Warrant Agent shall authenticate each new
Book-Entry Warrant Certificate as provided in SECTION 1.02 and shall deliver
each new Book-Entry Warrant Certificate to the Depository. The Warrant Agent
shall cancel each Book-Entry Warrant Certificate delivered to it by the
Depository in exchange therefor, if any.]
4
<PAGE>
SECTION 1.03. TRANSFER OF WARRANTS.
[IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: (a) [All] [A portion]
of the Warrants shall initially be represented by one or more Book-Entry Warrant
Certificates deposited with [the Depository Trust Company] (the "DEPOSITORY")
and registered in the name of [Cede & Co.], a nominee of the Depository. Except
as provided for in SECTION 1.03(b) hereof, no person acquiring Warrants with
book-entry settlement through the Depository shall receive or be entitled to
receive physical delivery of definitive Warrant Certificates evidencing such
Warrants. Ownership of beneficial interests in the Warrants shall be shown on,
and the transfer of such ownership shall be effected through, records maintained
by (i) the Depository or its nominee for each Book-Entry Warrant Certificate, or
(ii) institutions that have accounts with the Depository (such institution, with
respect to a Warrant in its account, a "PARTICIPANT").]
[IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: (b) If the Depository
subsequently ceases to make its book-entry settlement system available for the
Warrants, the Company may instruct the Warrant Agent regarding making other
arrangements for book-entry settlement. In the event that the Warrants are not
eligible for, or it is no longer necessary to have the Warrants available in,
book-entry form, the Warrant Agent shall provide written instructions to the
Depository to deliver to the Warrant Agent for cancellation each Book-Entry
Warrant Certificate, and the Company shall instruct the Warrant Agent to deliver
to the Depository definitive Warrant Certificates in physical form evidencing
such Warrants. Such definitive Warrant Certificates shall be in the form
annexed hereto as Exhibit A with appropriate insertions, modifications and
omissions, as provided above.]
[IF SECURITIES AND WARRANTS ARE TO BE OFFERED TOGETHER: (c) [IF WARRANTS
ARE NOT IMMEDIATELY DETACHABLE: Prior to the Detachment Date,] Warrants may be
transferred or exchanged only together with the Security to which such Warrant
is attached, and only for the purpose of effecting, or in conjunction with, a
transfer or exchange of such Security. Furthermore, [IF WARRANTS ARE NOT
IMMEDIATELY DETACHABLE: on or prior to the Detachment Date,] each transfer of a
Security on the register relating to such Securities shall operate also to
transfer the Warrants to which such Security was initially attached. [IF
WARRANTS ARE NOT IMMEDIATELY DETACHABLE: From and after the Detachment Date, the
above provisions shall be of no further force and effect.]
(d) A Warrant Certificate may be transferred at the option of the Holder
thereof upon surrender of such Warrant Certificate at the corporate trust office
of the Warrant Agent, properly endorsed or accompanied by appropriate
instruments of transfer and written instructions for transfer, all in form
satisfactory to the Company and the Warrant Agent [IF WARRANTS ARE TO BE ISSUED
IN BOOK-ENTRY FORM: ; PROVIDED, HOWEVER, that except as otherwise provided
herein or in any Book-Entry Warrant Certificate, each Book-Entry Warrant
Certificate may be transferred only in whole and only to the Depository, to
another nominee of the Depository, to a successor depository, or to a nominee of
a successor depository].
5
<PAGE>
Upon any such registration of transfer, the Company shall execute, and the
Warrant Agent shall countersign and deliver, as provided in SECTION 1.02, in the
name of the designated transferee a new Warrant Certificate or Warrant
Certificates of any authorized denomination evidencing in the aggregate a like
number of unexercised Warrants.
(e) [IF WARRANTS ARE NOT IMMEDIATELY DETACHABLE: After the Detachment
Date,] Upon surrender at the corporate office of the Warrant Agent, properly
endorsed or accompanied by appropriate instruments of transfer and written
instructions for such exchange, all in form satisfactory to the Company and the
Warrant Agent, one or more Warrant Certificates may be exchanged for one or more
Warrant Certificates in any other authorized denominations; PROVIDED, that such
new Warrant Certificate(s) evidence the same aggregate number of Warrants as the
Warrant Certificate(s) so surrendered. Upon any such surrender for exchange,
the Company shall execute, and the Warrant Agent shall countersign and deliver,
as provided in SECTION 1.02, in the name of the Holder of such Warrant
Certificates, the new Warrant Certificates.
(f) The Warrant Agent shall keep, at its corporate trust office, books in
which, subject to such reasonable regulations as it may prescribe, it shall
register Warrant Certificates in accordance with SECTION 1.02 and transfers,
exchanges, exercises and cancellations of outstanding Warrant Certificates.
Whenever any Warrant Certificates are surrendered for transfer or exchange in
accordance with this SECTION 1.03, an authorized officer of the Warrant Agent
shall manually countersign and deliver the Warrant Certificates which the Holder
making the transfer or exchange is entitled to receive.
(g) No service charge shall be made for any transfer or exchange of
Warrant Certificates, but the Company may require payment of a sum sufficient to
cover any stamp or other tax or other governmental charge that may be imposed in
connection with any such transfer or exchange.
SECTION 1.04. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT CERTIFICATES.
Upon receipt by the Company and the Warrant Agent of evidence satisfactory to
them of the ownership of and the loss, theft, destruction or mutilation of any
Warrant Certificate and of indemnity satisfactory to them and, in the case of
mutilation, upon surrender of such Warrant Certificate to the Warrant Agent for
cancellation, then, in the absence of notice to the Company or the Warrant Agent
that such Warrant Certificate has been acquired by a bona fide purchaser, the
Company shall execute, and an authorized officer of the Warrant Agent shall
manually countersign and deliver, in exchange for or in lieu of the lost,
stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate of
the same tenor and for a like number of Warrants. No service charge shall be
made for any replacement of Warrant Certificates, but the Company may require
the payment of a sum sufficient to cover any stamp or other tax or other
governmental charge that may be imposed in connection with any such exchange.
To the extent permitted under applicable law, the provisions of this
6
<PAGE>
SECTION 1.04 are exclusive with respect to the replacement of mutilated, lost,
stolen or destroyed Warrant Certificates and shall preclude any and all other
rights or remedies.
SECTION 1.05. CANCELLATION OF WARRANT CERTIFICATES. Any Warrant
Certificate surrendered to the Warrant Agent for transfer, exchange or exercise
of the Warrants evidenced thereby shall be promptly canceled by the Warrant
Agent and shall not be reissued and, except as expressly permitted by this
Agreement, no Warrant Certificate shall be issued hereunder in lieu thereof.
The Warrant Agent shall deliver to the Company from time to time or otherwise
dispose of canceled Warrant Certificates in a manner satisfactory to the
Company. Any Warrant Certificate surrendered to the Company for transfer,
exchange or exercise of the Warrants evidenced thereby shall be promptly
delivered to the Warrant Agent and such transfer, exchange or exercise shall not
be effective until such Warrant Certificate has been received by the Warrant
Agent.
SECTION 1.06. TREATMENT OF HOLDERS [IF WARRANTS ARE TO BE ISSUED IN
BOOK-ENTRY FORM: AND BENEFICIAL OWNERS] OF WARRANT CERTIFICATES. (a) The term
"HOLDER", as used herein, shall mean any person in whose name at the time any
Warrant Certificate shall be registered upon the books to be maintained by the
Warrant Agent for that purpose [IF WARRANTS ARE NOT IMMEDIATELY DETACHABLE: or,
prior to the Detachment Date, the person in whose name the Security to which
such Warrant Certificate was initially attached is registered upon the register
relating to such Securities. At all times prior to the Detachment Date, the
Company will, or will cause the registrar of the Securities to, make available
to the Warrant Agent such information as to holders of the Securities as may be
necessary to keep the Warrant Agent's records current]. [IF WARRANTS ARE TO BE
ISSUED IN BOOK-ENTRY FORM: The Holder of each Book-Entry Warrant Certificate
shall initially be [___________], a nominee of the Depository.]
[IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: (b) The term "BENEFICIAL
OWNER" as used herein shall mean any person in whose name ownership of
beneficial interests in Warrants evidenced by a Book-Entry Warrant Certificate
is recorded in the records maintained by the Depository or its nominee, or by a
Participant [IF WARRANTS ARE NOT IMMEDIATELY DETACHABLE: , or, prior to the
Detachment Date, the person in whose name the Security to which such Warrant
Certificate was initially attached is registered upon the register relating to
such Securities].]
(c) Every Holder [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: and
every Beneficial Owner] consents and agrees with the Company, the Warrant Agent
and with every subsequent Holder [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY
FORM: and Beneficial Owner] that until the Warrant Certificate is transferred on
the books of the Warrant Agent, the Company and the Warrant Agent may treat the
registered Holder of such Warrant Certificate as the absolute owner of the
Warrants evidenced thereby for any purpose and as the person entitled to
exercise the rights attaching to the Warrants evidenced thereby, any notice to
the contrary notwithstanding.
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ARTICLE II
EXERCISE PRICE, DURATION, EXERCISE AND CALL OF WARRANTS
SECTION 2.01. EXERCISE PRICE. The exercise price of each Warrant shall be
$________ (the "EXERCISE PRICE") [modify as appropriate to reflect terms of
offered Warrants].
SECTION 2.02. DURATION OF WARRANTS. [Subject to the limitations set forth
herein,] Each Warrant may be exercised in whole but not in part [UNLESS WARRANTS
MAY BE EXERCISED ON ONLY ONE DATE: on any Business Day (as defined below)
occurring during the period (the "EXERCISE PERIOD") commencing on [its date of
issuance] [_________ __, ____] and ending at 5:00 P.M., [New York] time,] on
__________ __, ____ (the "EXPIRATION DATE"). Each Warrant remaining unexercised
after 5:00 P.M., [New York] time, on the Expiration Date shall become void, and
all rights of the Holder under this Agreement shall cease.
As used herein, the term "BUSINESS DAY" means any day which is not a
Saturday or Sunday and is not a legal holiday or a day on which banking
institutions generally are authorized or obligated by law or regulation to close
in New York[ and __________].
SECTION 2.03. EXERCISE OF WARRANTS.
(a) A Holder may exercise a Warrant by delivering, not later than 5:00
P.M., [New York] time, on [UNLESS WARRANTS MAY BE EXERCISED ON ONLY ONE DATE:
any Business Day during the Exercise Period (the "EXERCISE DATE")] [IF WARRANTS
MAY BE EXERCISED ON ONLY ONE DATE: the Expiration Date] to the Warrant Agent at
its corporate trust department (i) the Warrant Certificate evidencing the
Warrants to be exercised, [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: and,
in the case of a Book-Entry Warrant Certificate, the Warrants to be exercised
(the "BOOK-ENTRY WARRANTS") on the records of the Depository to an account of
the Warrant Agent at the Depository designated for such purpose in writing by
the Warrant Agent to the Depository from time to time,] (ii) an election to
purchase the Warrant Securities ("ELECTION TO PURCHASE"), [FOR DEFINITIVE
WARRANT CERTIFICATES: properly completed and executed by the Holder on the
reverse of the Warrant Certificate] [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY
FORM: or, in the case of a Book-Entry Warrant Certificate, properly executed by
the Participant and substantially in the form included on the reverse of each
Warrant Certificate,] and (iii) the Exercise Price for each Warrant to be
exercised in lawful money of the United States of America by a cashier's check
or by wire transfer in immediately available funds. If any of (a) the Warrant
Certificate [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: or the Book-Entry
Warrants,] (b) the Election to Purchase, or (c) the Exercise Price therefor, is
received by the Warrant Agent after 5:00 P.M., [New York] time, on [UNLESS
WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: the specified Exercise Date, the
Warrants will be deemed to be received and exercised on the Business Day next
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succeeding the Exercise Date. If the date specified as the Exercise Date is not
a Business Day, the Warrants will be deemed to be received and exercised on the
next succeeding day which is a Business Day. If the Warrants are received or
deemed to be received after] the Expiration Date, the exercise thereof will be
null and void and any funds delivered to the Warrant Agent will be returned to
the Holder [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: or Participant, as
the case may be,] as soon as practicable. In no event will interest accrue on
funds deposited with the Warrant Agent in respect of an exercise or attempted
exercise of Warrants. The validity of any exercise of Warrants will be
determined by the Warrant Agent in its sole discretion and such determination
will be final and binding upon the Holder and the Company. Neither the Company
nor the Warrant Agent shall have any obligation to inform a Holder of the
invalidity of any exercise of Warrants. The Warrant Agent shall deposit all
funds received by it in payment of the Exercise Price in the account of the
Company maintained with the Warrant Agent for such purpose and shall advise the
Company by telephone at the end of each day on which funds for the exercise of
the Warrants are received of the amount so deposited to its account. The
Warrant Agent shall promptly confirm such telephonic advice to the Company in
writing.
(b) The Warrant Agent shall, by 11:00 A.M. on the Business Day following
the [UNLESS WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: Exercise Date of any
Warrant] [IF WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: Expiration Date],
advise the Company and the [Trustee under the Indenture applicable to] [the
transfer agent and registrar in respect of] the Warrant Securities issuable upon
such exercise as to the number of Warrants exercised in accordance with the
terms and conditions of this Agreement, the instructions of each Holder [IF
WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: or Participant, as the case may
be,] with respect to delivery of the Warrant Securities issuable upon such
exercise, and the delivery of definitive Warrant Certificates [IF WARRANTS ARE
TO BE ISSUED IN BOOK-ENTRY FORM: or one or more Book-Entry Warrant Certificates,
as appropriate,] evidencing the balance, if any, of the Warrants remaining after
such exercise, and such other information as the Company or such [Trustee]
[transfer agent and registrar] shall reasonably require.
(c) The Company shall, by 5:00 P.M., [New York] time, on the third
Business Day next succeeding the [UNLESS WARRANTS MAY BE EXERCISED ON ONLY ONE
DATE: Exercise Date of any Warrant] [IF WARRANTS MAY BE EXERCISED ON ONLY ONE
DATE: Expiration Date], execute, issue and deliver to the Warrant Agent,
[pursuant to the Indenture applicable to the Warrant Securities, the Warrant
Securities, duly authenticated by the Trustee of such Indenture and in
authorized denominations] [the Warrant Securities] to which such Holder is
entitled, in fully registered form, registered in such name or names as may be
directed by such Holder [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: or the
Participant, as the case may be]. Upon receipt of such Warrant Securities, the
Warrant Agent shall, by 5:00 P.M., [New York] time, on the fifth Business Day
next succeeding [UNLESS WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: such
Exercise Date] [IF WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: the Expiration
Date], transmit such Warrant Securities, to or upon the order of the Holder [IF
WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: or Participant, as the case may
be,] together with, or
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preceded by the prospectus referred to in SECTION 5.06. The Company agrees that
it will provide such information and documents to the Warrant Agent as may be
necessary for the Warrant Agent to fulfill its obligations hereunder.
(d) The accrual of [interest] [dividends], if any, on the Warrant
Securities issued upon the valid exercise of any Warrant will be governed by the
terms of the applicable [Indenture] [articles supplementary] and such Warrant
Securities. From and after the issuance of such Warrant Securities, the former
Holder of the Warrants exercised will be entitled to the benefits of the
[Indenture] [articles supplementary] under which such Warrant Securities are
issued and such former Holder's right to receive payments of [principal of (and
premium, if any) and interest, if any, on] [dividends and any other amounts
payable in respect of] the Warrant Securities shall be governed by, and shall be
subject to, the terms and provisions of such [Indenture] [articles
supplementary] and the Warrant Securities.
(e) Warrants may be exercised only in whole numbers of Warrants. [UNLESS
WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: If fewer than all of the Warrants
evidenced by a Warrant Certificate are exercised, a new Warrant Certificate for
the number of Warrants remaining unexercised shall be executed by the Company
and countersigned by the Warrant Agent as provided in SECTION 1.02, and
delivered to the Holder at the address specified on the books of the Warrant
Agent or as otherwise specified by such Holder.]
(f) The Company shall not be required to pay any stamp or other tax or
other governmental charge required to be paid in connection with any transfer
involved in the issue of the Warrant Securities; and in the event that any such
transfer is involved, the Company shall not be required to issue or deliver any
Warrant Securities until such tax or other charge shall have been paid or it has
been established to the Company's satisfaction that no such tax or other charge
is due.
[IF WARRANTS FOR COMMON SHARES ARE OFFERED: SECTION 2.04. ADJUSTMENT UNDER
CERTAIN CIRCUMSTANCES. The Exercise Price and the number of Warrant Securities
purchasable upon the exercise of each Warrant shall be subject to adjustment [as
shall be determined by the Warrant Agent, which determination shall be final and
binding upon the Holders and the Company.] as follows:
(i) If the Company at any time after the date of this Agreement
(1) declares a share dividend or other distribution on Securities payable
in shares, (2) subdivides the outstanding Common Shares or Preferred Shares
(for the purposes of this Section only, "SHARES") or (3) combines
outstanding Shares into a smaller number of Shares, the Exercise Price to
be in effect after the time of the record date for such dividend or
distribution or of the effective date of such subdivision or combination
shall be determined by multiplying the Exercise Price in effect immediately
prior to such time by a fraction, the numerator of which shall be the
number of Shares outstanding immediately prior to such time and the
denominator
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of which shall be the number of Shares to be outstanding immediately after
giving effect to such dividend, distribution, subdivision or combination,
in each case excluding any Shares held in the treasury of the Company
("TREASURY SHARES"). Such an adjustment shall be made successively whenever
any event listed above occurs.
(ii) If the Company fixes a record date for the issuance of rights
or warrants to all holders of Shares entitling them (for a period expiring
within __ days after such record date) to subscribe for or purchase Shares
(or securities convertible into Shares) at a price per Share (or having a
conversion price per share, if a security convertible into Shares) less
than the current market price per Share (as defined in subsection (iv)) on
such record date, the Exercise Price to be in effect after such record date
shall be determined by multiplying the Exercise Price in effect immediately
prior to such record date by a fraction, the numerator of which shall be
the number of Shares outstanding on such record date plus the number of
Shares which the aggregate offering price of the total number of Shares so
to be offered (or the aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such current market price
(as defined in subsection (iv)) and the denominator of which shall be the
number of Shares outstanding on such record date plus the number of
additional Shares to be offered for subscription or purchase (or into which
the convertible securities so to be offered are initially convertible). If
such subscription price may be paid in consideration, part or all of which
shall be in a form other than cash, the value of such consideration shall
be as determined in good faith by the Board of Trustees of the Company.
Shares owned by or held for the account of the Company or any
majority-owned subsidiary of the Company shall not be deemed outstanding
for the purpose of any such computation. Such an adjustment shall be made
successively whenever such a record date is fixed; and in the event that
such rights or warrants are not so issued and to the extent they are issued
but expire unexercised, the Exercise Price shall again be adjusted to be
the Exercise Price that would then be in effect if such record date had not
been fixed.
(iii) If the Company fixes a record date for the making of a
distribution to all holders of Shares (including any such distribution made
in connection with a consolidation or merger in which the Company is the
continuing entity) of shares of beneficial interest, evidences of its
indebtedness or assets (other than dividends or distributions in cash
payable out of consolidated earnings or earned surplus) or subscription
rights or warrants (excluding those referred to in subsection (ii), the
Exercise Price to be in effect after such record date shall be determined
by multiplying the Exercise Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the current
market price per Share (as defined in subsection (iv) on such record date,
less the fair market value (as determined in good faith by the Board of
Trustees of the Company) of the portion of such shares, evidences of
indebtedness, assets, subscription rights or warrants applicable to one
Share, and the denominator of which shall be such current market
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price per Share. Such an adjustment shall be made successively whenever
such a record date is fixed; and if such distribution is not so made, the
Exercise Price shall again be adjusted to be the Exercise Price which would
then be in effect if such record date had not been fixed.
(iv) For the purpose of any computation under subsections (ii) or
(iii), the current market price per Share on any record date shall be
deemed to be the average of the daily closing prices per share for the 30
consecutive NYSE trading days commencing 45 NYSE trading days before such
record date. For the purpose of all relevant provisions of this Agreement,
the closing price for each day shall be the last sale price regular way or,
in case no such sale takes place on such day, the average of the closing
bid and asked prices regular way, in either case on the NYSE, or, if the
Shares are not listed or admitted to trading on the NYSE, on the principal
national securities exchange on which the Shares are listed or admitted to
trading or, if the Shares are not listed or admitted to trading on any
national securities exchange, the average of the highest reported bid and
lowest reported asked prices as furnished by the National Association of
Securities Dealers, Inc. (the "NASD") through Nasdaq or a similar
organization if Nasdaq is no longer reporting such information (such
reported last sale price of, or such average of such bid and asked prices
for, the shares or any other securities is referred to herein as the
"MARKET VALUE" of the shares or such securities). If on any such trading
day the Shares are not quoted by any such organization, the current market
price of such Shares on such day, as determined by the Board of Trustees of
the Company, shall be used.
(v) Not withstanding the foregoing, no adjustment in the Exercise
Price shall be required unless such adjustment would require an increase or
decrease of at least one percent in such price; PROVIDED, HOWEVER, that any
adjustments which by reason of this subsection (v) are not required to be
made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this SECTION 2.04 shall be made to the
nearest cent or to the nearest one-hundredth of a Share, as the case may
be.
(vi) If at any time, as a result of an adjustment made pursuant to
this SECTION 2.04, the holder of any Warrant thereafter exercised becomes
entitled to receive any shares of the Company other than Shares, thereafter
the number of such other shares so receivable upon exercise of any Warrant
shall be subject to adjustment from time to time in a manner and on terms
as nearly equivalent as practicable to the provisions with respect to the
Shares contained in this SECTION 2.04, and the provisions of this SECTION
2.04 and SECTIONS 2.02, 2.03, 2.05, 5.08 and 5.14 with respect to the
Shares shall apply on like terms to any such other shares.
(vii) In any case in which this SECTION 2.04 shall require that an
adjustment in the Exercise Price be made effective as of a record date for
a specified event, the
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Company may elect to defer until the occurrence of such event the issuing
to the holder of any Warrant exercised after such record date, the Shares
and other capital stock of the Company, if any, issuable upon such exercise
over and above the Shares and other capital stock of the Company, if any,
issuable upon such exercise on the basis of the Exercise Price in effect
prior to such adjustment; PROVIDED, HOWEVER, that the Company shall deliver
to such holder a due bill or other appropriate instrument evidencing,
subject to the following proviso, such holder's right to receive such
additional Shares upon the occurrence of the event requiring such
adjustment and, provided further, to the extent such event does not occur,
the adjustment made in respect of such non-occurrence shall be retroactive
to such Record Date and affect all Warrants exercised between such Record
Date and the date of such non-occurrence.
(viii) Upon each adjustment of the Exercise Price pursuant to this
SECTION 2.04, each Warrant outstanding immediately prior to such adjustment
shall thereafter constitute the right to purchase, at the adjusted Exercise
Price per Share, an adjusted number of Shares determined (to the nearest
hundredth) by multiplying the number of Shares purchasable upon exercise of
a Warrant immediately prior to such adjustment by a fraction, the numerator
of which shall be the Exercise Price in effect immediately prior to such
adjustment and the denominator of which shall be the Exercise Price in
effect immediately after such adjustment; PROVIDED, HOWEVER, that the
Company may elect, in substitution for the adjustment in the number of
Shares pursuant to this subsection (viii), to adjust the number of Warrants
pursuant to subsection (ix).
(ix) In substitution for any adjustment in the number of Shares
purchasable upon the exercise of a Warrant as provided in subsection
(viii), the Company may elect to adjust the number of Warrants so that each
Warrant outstanding after such adjustment in number of Warrants shall be
exercisable for one share. Each Warrant held of record immediately prior to
such adjustment of the number of Warrants shall become that number of
Warrants determined (to the nearest hundredth) by multiplying the number of
shares purchasable upon exercise of a Warrant immediately prior to such
adjustment by a fraction, the numerator of which shall be the Exercise
Price in effect immediately prior to such adjustment and the denominator of
which shall be the Exercise Price in effect immediately after such
adjustment. The Company shall make a public announcement (by news release
and by notice to any securities exchange on which the Warrants are then
listed) of its election to adjust the number of Warrants, indicating the
record date for the adjustment and, if known at the time, the amount of the
adjustment to be made in the number of Warrants. This record date may be
the date on which the Exercise Price is adjusted or any day thereafter, but
shall be at least 10 days later than the date of the public announcement.
Upon each adjustment of the number of Warrants pursuant to this subsection
(ix) the Company shall, as promptly as practicable, cause to be
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distributed to holders of record of Warrant Certificates on such record
date Warrant Certificates evidencing the additional Warrants to which such
holders shall be entitled as a result of such adjustment or, at the option
of the Company, shall cause to be distributed to such holders of record in
substitution and replacement for the Warrant Certificates held by such
holders prior to the date of adjustment, and upon surrender thereof if
required by the Company in its sole discretion, new Warrant Certificates
evidencing all the Warrants to which such holders shall be entitled after
such adjustment. Warrant Certificates to be so distributed may, at the
option of the Company, bear the adjusted Exercise Price and shall be
registered in the names of the holders of record of Warrant Certificates on
the record date specified in the public announcement.
(x) In the case of any reclassification or change of outstanding
Shares (other than a change in par value, if any, as a result of a
subdivision or combination), or in case of any consolidation of the Company
with any other entity or any merger of the Company into another entity or
of another entity into the Company (other than a consolidation or merger in
which the Company is the continuing entity and which does not result in any
such reclassification or change of outstanding Shares, but including a
consolidation or merger in which the Company is the continuing entity and
in which all or a majority of the Shares outstanding immediately prior to
such consolidation (excluding Treasury Shares) or merger are converted
into, or converted into the right to receive, consideration other than
capital stock), or in case of any sale of the properties and assets of the
Company as, or substantially as, an entirety to any other person or entity,
each Warrant shall, after such reclassification or change of Shares,
consolidation, merger or sale, be exercisable at the then Exercise Price
and upon the other terms and conditions specified in this Agreement for the
number of shares of stock or other securities or assets (which may be cash)
to which a holder of the number of Shares purchasable (at the time of such
reclassification or change of Shares, consolidation, merger or sale) upon
the exercise of such Warrant would have been entitled (other than pursuant
to any applicable dissenters rights of appraisal) upon such
reclassification or change of Shares, consolidation, merger or sale; and in
any such case, the provisions set forth in this SECTION 2.04 with respect
to the rights and interests thereafter of the holders of the Warrants shall
be appropriately adjusted so as to be applicable, as nearly as may
reasonably be, to any shares of beneficial interest, other securities or
property thereafter deliverable on the exercise of the Warrants. The
Company shall not effect any such consolidation, merger or sale unless,
prior to or simultaneously with the consummation thereof, the successor
person or entity (if other than the Company) resulting from such
consolidation or merger or the corporation purchasing such assets or other
appropriate person or entity shall assume, by written instrument executed
and delivered to the Warrant Agent, the obligation to deliver to the holder
of each Warrant such shares of beneficial interest, securities or assets
as, in accordance with the foregoing provisions, such holders are entitled
to receive and to assume the other obligations of the Company under this
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Warrant Agreement. [Notwithstanding the foregoing, in the event of any such
consolidation, merger or sale in which holders of the Company's Common
Shares within two years of the date of this Agreement receive any
consideration other than common shares or rights, options or warrants to
acquire common shares, the holder of each Warrant so electing in a writing
filed with the Company prior thereto, shall be entitled to receive cash,
simultaneously with the consummation of such transaction, in an amount
equal to the average closing price of the Warrant (as determined in the
same manner as the average closing price per share is determined in the
second and third sentences of subsection (iv) for the 20 NYSE trading days
immediately preceding the public announcement of such merger, consolidation
or sale.]
(xi) Except as provided in this SECTION 2.04, no adjustment in
respect of any dividends on the Shares shall be made during the term of a
Warrant or upon the exercise of a Warrant.
(xii) Irrespective of any adjustments in the Exercise Price or the
number or kind of shares purchasable upon the exercise of the Warrants,
Warrant Certificates theretofore or thereafter issued may continue to
express the same Exercise Price per share and number and kind of shares as
are stated on the Warrant Certificates initially issuable pursuant to this
Agreement.
(xiii) Anything in this SECTION 2.04 to the contrary notwithstanding,
the Company shall be entitled to make such reductions in the Exercise Price
or increase in the number of shares purchasable upon the exercise of each
Warrant, in addition to those adjustments required by this SECTION 2.04, as
it in its sole discretion shall determine to be advisable in order that any
consolidation or subdivision of the Shares, or any issuance wholly for cash
of any Shares at less than the current market price, or any issuance wholly
for cash of Shares or securities which by their terms are convertible into
or exchangeable for Shares, or any stock dividend, or any issuance of
rights, options or warrants referred to above in this SECTION 2.04, made by
the Company to its common shareholders shall not be taxable to them.
(xiv) Anything in this SECTION 2.04 to the contrary notwithstanding,
the issuance of shares, or the granting of options to purchase shares, by
the Company or its subsidiaries to any of their employees under their
employee benefit, compensation or incentive plans, as well as the issuance
of shares under any dividend reinvestment plan of the Company, are not to
be taken into consideration for adjustments under this SECTION 2.04.
(xv) In addition to the foregoing adjustments and without
duplication, if (x) prior to the exercise of a Warrant an event ("EVENT")
occurs which, under the articles supplementary (or similar instrument) with
respect to the shares, would
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require an adjustment in the number of Common Shares into which the one
share purchasable on exercise of such Warrant would have been convertible
if such Warrant had then been exercised, then (y) after the Event such one
share shall, when acquired on exercise of the Warrant, be convertible into
the same number of Common Shares into which it would have been convertible
if such Warrant had been exercised prior to the Event. The adjustment
required by the foregoing sentence shall be made each time there is an
Event; PROVIDED, that no adjustment shall be made under this subsection
(xv) unless that adjustment results in a change of one percent, PROVIDED,
FURTHER, that all adjustments not made by virtue of the preceding
"provided" clause shall be carried forward and made when the aggregate of
all such adjustments results in a change of at least one percent.](*)
SECTION 2.05. CALL OF THE WARRANTS. If the closing price per share for
the Shares (determined as provided in the second sentence of SECTION 2.04(iv))
is greater than ___% of the Exercise Price (as defined below) then in effect for
any ___ NYSE trading days within a period of __ consecutive NYSE trading days,
the Company may elect, by written notice given within __ days after the end of
such __-day period, to redeem the Warrants, at a price of $_________ per
Warrant, on a date not less than __ days after the giving of such notice (which
date shall not be prior to _________, _________) (such date is referred to below
as the "WARRANT CALL DATE"). The notice of the Warrant Call Date shall be given
to the Warrant Agent as provided in SECTION 5.04 and copies of such notice shall
be mailed to the registered holders of the Warrant Certificates as provided in
SECTION 5.04. If there is not at any relevant time a NYSE, then business days
rather than trading days on the NYSE will be used in the foregoing provisions.
ARTICLE III
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS
[IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM:
AND BENEFICIAL OWNERS] OF WARRANTS
SECTION 3.01. NO RIGHTS AS HOLDERS OF WARRANT SECURITIES CONFERRED BY
WARRANTS OR WARRANT CERTIFICATES. No Warrant Certificate or Warrant evidenced
thereby shall entitle the Holder thereof to any of the rights of a holder of any
Warrant Securities, including, without limitation, [the right to receive the
payments of principal of (and premium, if any) and interest, if any, on Debt
Securities purchasable upon such exercise or to enforce any of
- --------------------
(*) This provision will be used, if at all, if the Warrants are
exercisable for Preferred Shares which are convertible into Common Shares.
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the covenants in the Indenture] [the right to receive dividends, if any, or
payments upon the liquidation, dissolution or winding up of the Company or to
exercise voting rights, if any].
SECTION 3.02. HOLDER [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: AND
BENEFICIAL OWNER] OF WARRANT MAY ENFORCE RIGHTS. Notwithstanding any of the
provisions of this Agreement, any Holder [IF WARRANTS ARE TO BE ISSUED IN
BOOK-ENTRY FORM: and any Beneficial Owner] of any Warrant, without the consent
of the Warrant Agent or the Holder of any Warrant, may, on such Holder's [IF
WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: or Beneficial Owner's] own behalf
and for his own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Company to enforce, or otherwise in respect of,
such Holder's [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: or Beneficial
Owner's] right to exercise the Warrants evidenced by any Warrant Certificate in
the manner provided in this Agreement and such Warrant Certificate.
ARTICLE IV
CONCERNING THE WARRANT AGENT
SECTION 4.01. WARRANT AGENT. The Company hereby appoints [Name of Warrant
Agent] as Warrant Agent of the Company in respect of the Warrants upon the terms
and subject to the conditions herein set forth, and [Name of Warrant Agent]
hereby accepts such appointment. The Warrant Agent shall have the powers and
authority granted to and conferred upon it hereby and such further powers and
authority to act on behalf of the Company as the Company may hereafter grant to
or confer upon it.
SECTION 4.02. LIMITATIONS ON WARRANT AGENT'S OBLIGATIONS. The Warrant
Agent accepts its obligations herein set forth upon the terms and conditions
hereof, including the following, to all of which the Company agrees and to all
of which the rights hereunder of the Holders from time to time shall be subject:
(a) COMPENSATION AND INDEMNIFICATION. The Company agrees to pay the
Warrant Agent compensation to be agreed upon with the Company for all
services rendered by the Warrant Agent and to reimburse the Warrant Agent
for all reasonable out-of-pocket expenses (including reasonable counsel
fees) incurred by the Warrant Agent in connection with the services
rendered by it hereunder. The Company also agrees to indemnify the Warrant
Agent for, and to hold it harmless against, any loss, liability or expense
incurred without negligence, bad faith or breach of this Agreement on the
part of the Warrant Agent, arising out of or in connection with its acting
as Warrant Agent hereunder.
(b) AGENT FOR THE COMPANY. In acting in the capacity of Warrant
Agent under this Agreement, the Warrant Agent is acting solely as agent of
the Company and does
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not assume any obligation or relationship of agency or trust with any of
the owners or holders of the Warrants except as expressly set forth herein.
(c) COUNSEL. The Warrant Agent may consult with counsel satisfactory
to it (which may be counsel to the Company), and the advice of such counsel
shall be full and complete authorization and protection in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
accordance with the advice of such counsel.
(d) DOCUMENTS. The Warrant Agent shall be protected and shall incur
no liability for or in respect of any action taken or thing suffered by it
in reliance upon any notice, direction, consent, certificate, affidavit,
statement or other paper or document reasonably believed by it to be
genuine and to have been presented or signed by the proper parties.
(e) CERTAIN TRANSACTIONS. The Warrant Agent, and its officers,
directors and employees, may become the owner of, or acquire any interest
in, any Warrant, with the same rights that it or they would have were it
not the Warrant Agent hereunder, and, to the extent permitted by applicable
law, it or they may engage or be interested in any financial or other
transaction with the Company and may act on, or as a depository, trustee or
agent for, any committee or body of holders of Warrants [IF SECURITIES AND
WARRANTS ARE TO BE OFFERED TOGETHER: , Securities] or Warrant Securities,
or other securities or obligations of the Company as freely as if it were
not the Warrant Agent hereunder. Nothing in this Agreement shall be deemed
to prevent the Warrant Agent from acting as trustee under either Indenture.
(f) NO LIABILITY FOR INTEREST. The Warrant Agent shall not be under
any liability for interest on any monies at any time received by it
pursuant to any of the provisions of this Agreement.
(g) NO LIABILITY FOR INVALIDITY. The Warrant Agent shall not be
under any responsibility with respect to the validity or sufficiency of
this Agreement or the execution and delivery hereof (except the due
execution and delivery hereof by the Warrant Agent) or with respect to the
validity or execution of the Warrant Certificates (except its
countersignature thereon).
(h) NO RESPONSIBILITY FOR RECITALS. The recitals contained herein
and in the Warrant Certificates (except as to the Warrant Agent's
countersignature thereon) shall be taken as the statements of the Company
and the Warrant Agent assumes no responsibility hereby for the correctness
of the same.
(i) NO IMPLIED OBLIGATIONS. The Warrant Agent shall be obligated to
perform such duties as are specifically set forth herein and no implied
duties or obligations
18
<PAGE>
shall be read into this Agreement against the Warrant Agent. The Warrant
Agent shall not be under any obligation to take any action hereunder which
may tend to involve it in any expense or liability, the payment of which
within a reasonable time is not, in its opinion, assured to it. The
Warrant Agent shall not be accountable or under any duty or responsibility
for the use by the Company of any Warrant Certificate authenticated by the
Warrant Agent and delivered by it to the Company pursuant to this Agreement
or for the application by the Company of the proceeds of the issue and
sale, or exercise, of the Warrants. The Warrant Agent shall have no duty
or responsibility in case of any default by the Company in the performance
of its covenants or agreements contained herein or in any Warrant
Certificate or in the case of the receipt of any written demand from a
Holder with respect to such default, including, without limiting the
generality of the foregoing, any duty or responsibility to initiate or
attempt to initiate any proceedings at law or otherwise or, except as
provided in SECTION 5.03, to make any demand upon the Company.
SECTION 4.03. COMPLIANCE WITH APPLICABLE LAWS. The Warrant Agent
agrees to comply with all applicable federal and state laws imposing obligations
on it in respect of the services rendered by it under this Agreement and in
connection with the Warrants, including (but not limited to) the provisions of
United States federal income tax laws regarding information reporting and backup
withholding. The Warrant Agent expressly assumes all liability for its failure
to comply with any such laws imposing obligations on it, including (but not
limited to) any liability for its failure to comply with any applicable
provisions of United States federal income tax laws regarding information
reporting and backup withholding.
SECTION 4.04. RESIGNATION AND APPOINTMENT OF SUCCESSOR.
(a) The Company agrees, for the benefit of the Holders from time to
time, that there shall at all times be a Warrant Agent hereunder until all the
Warrants issued hereunder have been exercised or have expired in accordance with
their terms, which Warrant Agent shall be a bank or trust company organized
under the laws of the United States of America or one of the states thereof,
which is authorized under the laws of the jurisdiction of its organization to
exercise corporate trust powers, has a combined capital and surplus of at least
$50,000,000 and has an office or an agent's office in the United States of
America.
(b) The Warrant Agent may at any time resign as such agent by giving
written notice to the Company of such intention on its part, specifying the date
on which it desires such resignation to become effective; PROVIDED, that such
date shall not be less than three months after the date on which such notice is
given, unless the Company agrees to accept such notice less than three months
prior to such date of effectiveness. The Company may remove the Warrant Agent
at any time by giving written notice to the Warrant Agent of such removal,
specifying the date on which it desires such removal to become effective.
19
<PAGE>
Such resignation or removal shall take effect upon the appointment by the
Company, as hereinafter provided, of a successor Warrant Agent (which shall be a
bank or trust company qualified as set forth in SECTION 4.04(a)) and the
acceptance of such appointment by such successor Warrant Agent. The obligation
of the Company under SECTION 4.02(a) shall continue to the extent set forth
therein notwithstanding the resignation or removal of the Warrant Agent.
(c) If at any time the Warrant Agent shall resign, or shall cease to be
qualified as set forth in SECTION 4.04(a), or shall be removed, or shall become
incapable of acting, or shall be adjudged a bankrupt or insolvent, or shall file
a petition seeking relief under any applicable Federal or State bankruptcy or
insolvency law or similar law, or make an assignment for the benefit of its
creditors or consent to the appointment of a receiver, conservator or custodian
of all or any substantial part of its property, or shall admit in writing its
inability to pay or to meet its debts as they mature, or if a receiver or
custodian of it or of all or any substantial part of its property shall be
appointed, or if an order of any court shall be entered for relief against it
under the provisions of any applicable Federal or State bankruptcy or similar
law, or if any public officer shall have taken charge or control of the Warrant
Agent or of its property or affairs, for the purpose of rehabilitation,
conservation or liquidation, a successor Warrant Agent, qualified as set forth
in SECTION 4.04(a), shall be appointed by the Company by an instrument in
writing, filed with the successor Warrant Agent. Upon the appointment as herein
provided of a successor Warrant Agent and acceptance by the latter of such
appointment, the Warrant Agent so superseded shall cease to be Warrant Agent
under this Agreement.
(d) Any successor Warrant Agent appointed under this Agreement shall
execute, acknowledge and deliver to its predecessor and to the Company an
instrument accepting such appointment, and thereupon such successor Warrant
Agent, without any further act, deed or conveyance, shall become vested with all
the authority, rights, powers, trusts, immunities, duties and obligations of
such predecessor with like effect as if originally named as Warrant Agent under
this Agreement, and such predecessor, upon payment of its charges and
disbursements then unpaid, shall thereupon become obligated to transfer, deliver
and pay over, and such successor Warrant Agent shall be entitled to receive, all
monies, securities and other property on deposit with or held by such
predecessor, as Warrant Agent under this Agreement.
(e) Any corporation into which the Warrant Agent may be merged or
converted or any corporation with which the Warrant Agent may be consolidated,
or any corporation resulting from any merger, conversion or consolidation to
which the Warrant Agent shall be a party, or any corporation to which the
Warrant Agent shall sell or otherwise transfer all or substantially all the
assets and business of the Warrant Agent, in each case provided that it shall be
qualified as set forth in SECTION 4.04(a), shall be the successor Warrant Agent
under this Agreement without the execution or filing of any paper or any
20
<PAGE>
further act on the part of any of the parties to this Agreement, including,
without limitation, any successor to the Warrant Agent first named above.
ARTICLE V
MISCELLANEOUS
SECTION 5.01. AMENDMENTS.
(a) This Agreement and any Warrant Certificate may be amended by the
parties hereto by executing a supplemental warrant agreement (a "SUPPLEMENTAL
AGREEMENT"), without the consent of the Holder of any Warrant, for the purpose
of (i) curing any ambiguity, or curing, correcting or supplementing any
defective provision contained herein, or making any other provisions with
respect to matters or questions arising under this Agreement that is not
inconsistent with the provisions of this Agreement or the Warrant Certificates,
(ii) evidencing the succession of another entity to the Company and the
assumption by any such successor of the covenants of the Company contained in
this Warrant Agreement and the Warrants, (iii) evidencing and providing for the
acceptance of appointment by a successor Warrant Agent with respect to the
Warrants, [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: (iv) evidencing and
providing for the acceptance of appointment by a successor Depository with
respect to each Book-Entry Warrant Certificate, (v) issuing definitive Warrant
Certificates in accordance with paragraph (b) of SECTION 1.03,] (vi) adding to
the covenants of the Company for the benefit of the Holders or surrendering any
right or power conferred upon the Company under this Agreement, (vii) appointing
a successor Warrant Agent, or (viii) amending this Agreement and the Warrants in
any manner that the Company may deem to be necessary or desirable and that will
not adversely affect the interests of the Holders in any material respect.
(b) The Company and the Warrant Agent may amend this Agreement and
the Warrants by executing a Supplemental Agreement with the consent of the
Holders of not fewer than a majority of the unexercised Warrants affected by
such amendment, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Holders under this Agreement; PROVIDED, HOWEVER,
that, without the consent of each Holder of Warrants affected thereby, no such
amendment may be made that (i) changes the Warrants so as to reduce the
[principal amount] [number] of Warrant Securities purchasable upon exercise of
the Warrants or so as to increase the exercise price [IF WARRANTS FOR COMMON
SHARES ARE OFFERED: (other than as provided by SECTION 2.04)], (ii) shortens the
period of time during which the Warrants may be exercised, (iii) otherwise
adversely affects the exercise rights of the Holders in any material respect, or
(iv) reduces the number of unexercised Warrants the consent of the Holders of
which is required for amendment of this Agreement or the Warrants.
21
<PAGE>
SECTION 5.02. MERGER, CONSOLIDATION, SALE, TRANSFER OR CONVEYANCE.
The Company may consolidate or merge with or into any other corporation,
partnership or trust or sell, lease, transfer or convey all or substantially all
of its assets to any other corporation, partnership or trust; PROVIDED, that (i)
either (x) the Company is the continuing entity or (y) the entity (if other than
the Company) that is formed by or results from any such consolidation or merger
or that receives such assets is organized and existing under the laws of the
United States of America or a state thereof and such entity assumes the
obligations of the Company with respect to the performance and observance of all
of the covenants and conditions of this Agreement to be performed or observed by
the Company and (ii) the Company or such successor, as the case may be, must not
immediately be in default under this Agreement. If at any time there shall be
any consolidation or merger or any sale, lease, transfer, conveyance or other
disposition of all or substantially all of the assets of the Company, then in
any such event the successor or assuming entity shall succeed to and be
substituted for the Company, with the same effect as if it had been named herein
and in the Warrant Certificates as the Company; the Company shall thereupon be
relieved of any further obligation hereunder or under the Warrants, and, in the
event of any such sale, lease, transfer, conveyance (other than by way of lease)
or other disposition, the Company as the predecessor entity may thereupon or at
any time thereafter be dissolved, wound up or liquidated. Such successor or
assuming entity thereupon may cause to be signed, and may issue either in its
own name or in the name of the Company, Warrant Certificates evidencing the
Warrants not theretofore exercised, in exchange and substitution for the Warrant
Certificates theretofore issued. Such Warrant Certificates shall in all
respects have the same legal rank and benefit under this Agreement as the
Warrant Certificates evidencing the Warrants theretofore issued in accordance
with the terms of this Agreement as though such new Warrant Certificates had
been issued at the date of the execution hereof. In any case of any such merger
or consolidation or sale, lease, transfer, conveyance or other disposition of
all or substantially all of the assets of the Company, such changes in
phraseology and form (but not in substance) may be made in the new Warrant
Certificates, as may be appropriate.
SECTION 5.03. NOTICES AND DEMANDS TO THE COMPANY AND WARRANT AGENT.
If the Warrant Agent shall receive any notice or demand addressed to the Company
by the Holder [IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: or a
Participant, as the case may be], the Warrant Agent shall promptly forward such
notice or demand to the Company.
SECTION 5.04. ADDRESSES. Any communications from the Company to the
Warrant Agent with respect to this Agreement shall be addressed to
____________________, Attention: ________________________, and any
communications from the Warrant Agent to the Company with respect to this
Agreement shall be addressed to Prime Group Realty Trust, 77 West Wacker Drive,
Suite 3900, Chicago, Illinois 60601, Attention: _____________ (or such other
address as shall be specified in writing by the Warrant Agent or by the Company,
as the case may be). The Company or the Warrant Agent shall give notice to the
Holders of Warrants by mailing written notice by first class mail, postage
prepaid, to such Holders as their names and
22
<PAGE>
addresses appear in the books and records of the Warrant Agent [or, prior to the
Detachment Date, on the register of the Securities].
SECTION 5.05. GOVERNING LAW. THIS AGREEMENT AND EACH WARRANT
CERTIFICATE AND ALL RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND
THEREOF SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF [NEW YORK] (WITHOUT REFERENCE TO APPLICABLE CONFLICTS OF LAW
PROVISIONS).
SECTION 5.06. DELIVERY OF PROSPECTUS. The Company shall furnish to
the Warrant Agent sufficient copies of a prospectus relating to the Warrant
Securities deliverable upon exercise of Warrants and complying in all material
respects with the Securities Act of 1933, as amended (the "PROSPECTUS"), and the
Warrant Agent agrees that upon the exercise of any Warrant, the Warrant Agent
shall deliver a Prospectus to the Holder of such Warrant, prior to or
concurrently with the delivery of the Warrant Securities issued upon such
exercise.
SECTION 5.07. OBTAINING OF GOVERNMENTAL APPROVALS. The Company shall
from time to time take all action which may be necessary to obtain and keep
effective any and all permits, consents and approvals of governmental agencies
and authorities and securities acts filings under United States Federal and
state laws, which the Company may deem necessary or appropriate in connection
with the issuance, sale, transfer and delivery of the Warrants, the exercise of
the Warrants, the issuance, sale, transfer and delivery of the Warrant
Securities to be issued upon exercise of Warrants or upon the expiration of the
period during which the Warrants are exercisable.
SECTION 5.08. PAYMENT OF TAXES. The Company will pay all stamp and
other duties, if any, to which, under the laws of the United States of America,
this Agreement or the original issuance of the Warrants may be subject.
SECTION 5.09. BENEFITS OF WARRANT AGREEMENT. Nothing in this
Agreement or any Warrant Certificate expressed or implied and nothing that may
be inferred from any of the provisions hereof or thereof is intended, or shall
be construed, to confer upon, or give to, any person or corporation other than
the Company, the Warrant Agent and their respective successors and assigns, [IF
WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM: the Beneficial Owners] and the
Holders any right, remedy or claim under or by reason of this Agreement or any
Warrant Certificate or of any covenant, condition, stipulation, promise or
agreement hereof or thereof; and all covenants, conditions, stipulations,
promises and agreements contained in this Agreement or any Warrant Certificate
shall be for the sole and exclusive benefit of the Company and the Warrant Agent
and their respective successors and assigns and of the [IF WARRANTS ARE TO BE
ISSUED IN BOOK-ENTRY FORM: Beneficial Owners and] Holders.
23
<PAGE>
SECTION 5.10. HEADINGS. The descriptive headings of the several
Articles and Sections of this Agreement are inserted for convenience only and
shall not control or affect the meaning or construction of any of the provisions
hereof.
SECTION 5.11. SEVERABILITY. If any provision in this Agreement or in
any Warrant Certificate shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions, or of such provisions in any other jurisdiction, shall not in any
way be affected or impaired thereby.
SECTION 5.12. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original; but such counterparts shall together constitute but one and the same
instrument.
SECTION 5.13. INSPECTION OF AGREEMENT. A copy of this Agreement
shall be available at all reasonable times at the principal corporate trust
office of the Warrant Agent and at the office of the Company at 77 West Wacker
Drive, Suite 3900, Chicago, Illinois 60601, for inspection by any Holder. The
Warrant Agent may require any such Holder to submit satisfactory proof of
ownership for inspection by it.
SECTION 5.14. BOARD OF TRUSTEES ACTION; NO LIABILITY OF TRUSTEES,
OFFICERS, EMPLOYEES OR SHAREHOLDERS.
(a) Any determination that may be made by the Board of Trustees of the
Company under this Agreement may be made by a duly authorized committee of the
Board or, to the extent permitted by applicable corporate law, by an individual
acting pursuant to authority granted by the Board of Trustees.
(b) No trustee, officer, employee or shareholder of the Company, as
such, shall have any liability under this Agreement or the Warrants. By
accepting the Warrants, each holder of Warrants agrees to the foregoing and
waives and releases all such liability.
SECTION 5.15. WARRANT HOLDERS NOT SHAREHOLDERS. Nothing contained in
this Agreement or in any of the Warrant Certificates shall be construed as
conferring upon the holders thereof, as such, the right to vote or receive
dividends or notices as shareholders of the Company in respect of any meeting of
shareholders for the election of trustees of the Company or any other matter to
vote at any such meeting, to exercise any rights whatsoever as shareholders of
the Company or to be deemed for any purpose the holder of Shares or of any other
securities of the Company that may at any time be issuable on the exercise or
conversion of the Warrant Certificates, nor shall anything contained herein or
in the Warrant Certificates be construed to confer upon the holders thereof, as
such, any of the other rights of a shareholder of the Company.
24
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
PRIME GROUP REALTY TRUST
By:
----------------------------
Name:
---------------------
Title:
--------------------
[WARRANT AGENT]
By:
----------------------------
Name:
---------------------
Title:
--------------------
25
<PAGE>
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
[FORM OF LEGEND IF SECURITIES WITH WARRANTS THAT ARE NOT IMMEDIATELY DETACHABLE
OR WARRANTS THAT ARE NOT IMMEDIATELY EXERCISABLE ARE OFFERED: [PRIOR TO
_______________,] THIS WARRANT CERTIFICATE [(i) CANNOT BE TRANSFERRED OR
EXCHANGED UNLESS ATTACHED TO A [TITLE OF SECURITY] AND (II)] CANNOT BE EXERCISED
IN WHOLE OR IN PART.]
EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT
AGENT AS PROVIDED HEREIN.
Warrant Certificate evidencing
Warrants to Purchase
[Title of Warrant Securities]
as described herein.
PRIME GROUP REALTY TRUST
No. ___________ CUSIP No. _____________
VOID AFTER [5:00 P.M.], [NEW YORK] TIME, ON _______ __, ___
This certifies that ________________________ or registered assigns is
the registered holder of [insert number initially issued] warrants to purchase
certain securities (the "WARRANTS"). Each Warrant entitles the holder thereof,
subject to the provisions contained herein and in the Warrant Agreement referred
to below, to purchase from Prime Group Realty Trust, a Maryland real estate
investment trust (the "COMPANY"), [$_________ principal amount] [______] of the
Company's [title of Securities purchasable upon exercise of Warrants] [IF
WARRANTS FOR DEPOSITARY SHARES ARE TO BE OFFERED: , each representing a 1/__th
interest in a share of [title of securities represented by the Depositary
Shares]] (the "WARRANT SECURITIES" [IF WARRANTS FOR DEPOSITARY SHARES ARE TO BE
OFFERED: , which term shall also refer, as appropriate, to such [title of
securities represented by the Depositary Shares]), [issued or to be issued under
the Indenture (as hereinafter defined)], at the Exercise Price set forth below.
The exercise price of each Warrant (the "EXERCISE PRICE") shall be [modify as
appropriate to reflect the terms of the offered Warrants].
<PAGE>
Subject to the terms of the Warrant Agreement, each Warrant evidenced
hereby may be exercised in whole but not in part at any time, as specified
herein, [UNLESS WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: on any Business Day
(as defined below) occurring during the period (the "EXERCISE PERIOD")
commencing on [the date of issuance thereof] [________________ __, ____] and
ending at 5:00 P.M., [New York] time,] on ____________ __, ____ (the "EXPIRATION
DATE"). Each Warrant remaining unexercised after 5:00 P.M., [New York] time, on
the Expiration Date shall become void, and all rights of the holder of this
Warrant Certificate evidencing such Warrant shall cease.
The holder of the Warrants represented by this Warrant Certificate may
exercise any Warrant evidenced hereby by delivering, not later than 5:00 P.M.,
[New York] time, on [UNLESS WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: any
Business Day during the Exercise Period (the "EXERCISE DATE")] [IF WARRANTS MAY
BE EXERCISED ON ONLY ONE DATE: the Expiration Date] to [name of Warrant Agent]
(the "WARRANT AGENT", which term includes any successor warrant agent under the
Warrant Agreement described below) at its corporate trust department at
___________________, (i) this Warrant Certificate [FOR BOOK-ENTRY WARRANT
CERTIFICATE: and the Warrants to be exercised (the "BOOK-ENTRY WARRANTS") free
on the records of [The Depository Trust Company] (the "DEPOSITORY") to an
account of the Warrant Agent at the Depository designated for such purpose in
writing by the Warrant Agent to the Depository], (ii) an election to purchase
("ELECTION TO PURCHASE"), [FOR DEFINITIVE WARRANT CERTIFICATES: properly
executed by the holder hereof on the reverse of this Warrant Certificate] [FOR
BOOK-ENTRY WARRANT CERTIFICATES: properly executed by the institution in whose
account the Warrant is recorded on the records of the Depository (the
"PARTICIPANT"), and substantially in the form included on the reverse of hereof]
and (iii) the Exercise Price for each Warrant to be exercised in lawful money of
the United States of America by certified or official bank check or by bank wire
transfer in immediately available funds. If any of (a) this Warrant Certificate
[FOR BOOK-ENTRY WARRANT CERTIFICATES: or the Book-Entry Warrants], (b) the
Election to Purchase, or (c) the Exercise Price therefor, is received by the
Warrant Agent after 5:00 P.M., [New York] time, on [UNLESS WARRANTS MAY BE
EXERCISED ON ONLY ONE DATE: the specified Exercise Date, the Warrants will be
deemed to be received and exercised on the Business Day next succeeding the
Exercise Date. If the date specified as the Exercise Date is not a Business
Day, the Warrants will be deemed to be received and exercised on the next
succeeding day which is a Business Day. If the Warrants to be exercised are
received or deemed to be received after] the Expiration Date, the exercise
thereof will be null and void and any funds delivered to the Warrant Agent will
be returned to the holder as soon as practicable. In no event will interest
accrue on funds deposited with the Warrant Agent in respect of an exercise or
attempted exercise of Warrants. The validity of any exercise of Warrants will
be determined by the Warrant Agent in its sole discretion and such determination
will be final and binding upon the holder of the Warrants and the Company.
Neither the Warrant Agent nor the Company shall have any obligation to inform a
holder of Warrants of the invalidity of any exercise of Warrants. As used
herein, the term "BUSINESS DAY" means any day which is not a Saturday or Sunday
and is not a legal holiday or a day on which banking institutions generally are
authorized or obligated by law or regulation to close in New York [or
___________].
Warrants may be exercised only in whole numbers of Warrants. [UNLESS
WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: If fewer than all of the Warrants
evidenced by
<PAGE>
this Warrant Certificate are exercised, a new Warrant Certificate for the number
of Warrants remaining unexercised shall be executed by the Company and
countersigned by the Warrant Agent as provided in SECTION 1.02 of the Warrant
Agreement, and delivered to the holder of this Warrant Certificate at the
address specified on the books of the Warrant Agent or as otherwise specified by
such registered holder.]
This Warrant Certificate is issued under and in accordance with the
Warrant Agreement, dated as of ___________ __, ____ (the "WARRANT AGREEMENT"),
between the Company and the Warrant Agent and is subject to the terms and
provisions contained in the Warrant Agreement, to all of which terms and
provisions the holder of this Warrant Certificate [FOR BOOK-ENTRY WARRANT
CERTIFICATE: and the beneficial owners of the Warrants represented by this
Warrant Certificate] consent[s] by acceptance hereof. Copies of the Warrant
Agreement are on file and can be inspected at the above-mentioned office of the
Warrant Agent and at the office of the Company at 77 West Wacker Drive, Suite
3900, Chicago, Illinois 60601.
[IF THE WARRANT SECURITIES ARE DEBT SECURITIES: The Warrant Securities
to be issued and delivered upon the exercise of the Warrants evidenced by this
Warrant Certificate will be issued under and in accordance with the Indenture,
dated as of _________ __, ____ (the "INDENTURE"), between the Company and [name
of trustee], as trustee (together with any successor or successors as such
trustee, the "TRUSTEE"), and will be subject to the terms and provisions
contained in the Warrant Securities and in the Indenture.] The accrual of
[interest] [dividends], if any, on the Warrant Securities issued upon the valid
exercise of any Warrant will be governed by the terms of the applicable
[Indenture] [articles supplementary] and such Warrant Securities. From and
after the issuance of such Warrant Securities, the former holder of the Warrants
exercised will be entitled to the benefits of the [Indenture] [articles
supplementary] under which such Warrant Securities are issued and such former
holder's right to receive payments of [principal of (and premium, if any) and
interest, if any, on] [dividends and any other amounts payable in respect of]
the Warrant Securities shall be governed by, and shall be subject to, the terms
and provisions of such [Indenture] [articles supplementary] and the Warrant
Securities. Copies of the [Indenture, including the form of the Warrant
Securities,] [articles supplementary] are on file at the corporate trust office
of the Trustee.]
[IF WARRANTS FOR COMMON SHARES ARE OFFERED: The Exercise Price and
the number of Warrant Securities purchasable upon the exercise of each Warrant
shall be subject to adjustment [as shall be determined by the Warrant Agent,
which determination shall be final and binding upon the holders of the Warrants
and the Company][as provided pursuant to SECTION 2.04 of the Warrant Agreement].
[IF SECURITIES AND WARRANTS ARE TO BE OFFERED TOGETHER: [IF WARRANTS
ARE NOT IMMEDIATELY DETACHABLE: Prior to the Detachment Date,] The Warrants
represented by this Warrant Certificate may be exchanged or transferred only
together with the [title of Security]
<PAGE>
(the "SECURITY") to which the Warrants are attached, and only for the purpose of
effecting, or in conjunction with, an exchange or transfer of such Security.
Additionally, [IF WARRANTS ARE NOT IMMEDIATELY DETACHABLE: on or prior to the
Detachment Date,] each transfer of such Security on the register of the
Securities shall operate also to transfer the Warrants to which such Securities
was initially attached. [IF WARRANTS ARE NOT IMMEDIATELY DETACHABLE: From and
after the Detachment Date, the above provisions shall be of no further force and
effect.]] Upon due presentment for registration of transfer or exchange of this
Warrant Certificate at the corporate trust office of the Warrant Agent, the
Company shall execute, and the Warrant Agent shall countersign and deliver, as
provided in SECTION 1.02 of the Warrant Agreement, in the name of the designated
transferee one or more new Warrant Certificates of any authorized denomination
evidencing in the aggregate a like number of unexercised Warrants, subject to
the limitations provided in the Warrant Agreement.
Neither this Warrant Certificate nor the Warrants evidenced hereby
shall entitle the holder hereof or thereof to any of the rights of a holder of
the Warrant Securities, including, without limitation, [the right to receive the
payments of principal of (and premium, if any), and interest, if any, on Debt
Securities purchasable upon such exercise or to enforce any of the covenants in
the applicable Indenture] [the right to receive dividends, if any, or payments
upon the liquidation, dissolution or winding up of the Company or to exercise
voting rights, if any].
The Warrant Agreement and this Warrant Certificate may be amended as
provided in the Warrant Agreement including, under certain circumstances
described therein, without the consent of the holder of this Warrant Certificate
or the Warrants evidenced thereby.
THIS WARRANT CERTIFICATE AND ALL RIGHTS HEREUNDER AND UNDER THE
WARRANT AGREEMENT AND PROVISIONS HEREOF AND THEREOF SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF [NEW YORK] (WITHOUT
REFERENCE TO APPLICABLE CONFLICTS OF LAW PROVISIONS).
This Warrant Certificate shall not be entitled to any benefit under
the Warrant Agreement or be valid or obligatory for any purpose, and no Warrant
evidenced hereby may be exercised, unless this Warrant Certificate has been
countersigned by the manual signature of the Warrant Agent.
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
Dated as of ________ __, ____
PRIME GROUP REALTY TRUST
By:
----------------------------
Name:
---------------------
Title:
--------------------
[NAME OF WARRANT AGENT],
as Warrant Agent
By:
------------------------------
Name:
------------------------
Title:
-----------------------
<PAGE>
[REVERSE]
INSTRUCTIONS FOR EXERCISE OF WARRANT
To exercise the Warrants evidenced hereby, the holder [FOR BOOK-ENTRY
WARRANT CERTIFICATE: or Participant] must, by 5:00 P.M., [New York] time, on the
specified Exercise Date, deliver to the Warrant Agent at its corporate trust
department, a certified or official bank check or a wire transfer in immediately
available funds, in each case payable to the Warrant Agent at Account No. ____,
in an amount equal to the Exercise Price in full for the Warrants exercised. In
addition, the Warrant holder [FOR BOOK-ENTRY WARRANT CERTIFICATES: or
Participant] must provide the information required below and deliver this
Warrant Certificate to the Warrant Agent at the address set forth below [FOR
BOOK-ENTRY WARRANT CERTIFICATES: and the Book-Entry Warrants to the Warrant
Agent in its account with the Depository designated for such purpose]. This
Warrant Certificate and the Election to Purchase must be received by the Warrant
Agent by 5:00 P.M., [New York] time, on the specified Exercise Date.
ELECTION TO PURCHASE
TO BE EXECUTED IF WARRANT HOLDER DESIRES
TO EXERCISE THE WARRANTS EVIDENCED HEREBY
The undersigned hereby irrevocably elects to exercise, on __________,
____ (the "EXERCISE DATE"), _____________ Warrants, evidenced by this Warrant
Certificate, to purchase, [$_____________ principal amount] [_________________]
of the [title of Securities purchasable upon exercise of Warrants] [IF WARRANTS
FOR DEPOSITARY SHARES ARE TO BE OFFERED: , each representing a 1/__th interest
in a share of [title of securities represented by the Depositary Shares]] (the
"WARRANT SECURITIES") of Prime Group Realty Trust, a Maryland real estate
investment trust (the "COMPANY"), and represents that on or before the Exercise
Date such holder has tendered payment for such Warrant Securities by certified
or official bank check or bank wire transfer in immediately available funds to
the order of the Company c/o [Name and address of Warrant Agent], in the amount
of $_____________ in accordance with the terms hereof. The undersigned requests
that said [principal amount of] [number of] Warrant Securities be in fully
registered form, in the authorized denominations, registered in such names and
delivered, all as specified in accordance with the instructions set forth below.
[UNLESS WARRANTS MAY BE EXERCISED ON ONLY ONE DATE: If said [principal
amount] [number] of Warrant Securities is less than all of the Warrant
Securities purchasable hereunder, the undersigned requests that a new Warrant
Certificate evidencing the remaining
<PAGE>
balance of the Warrants evidenced hereby be issued and delivered to the holder
of the Warrant Certificate unless otherwise specified in the instructions
below.]
Dated: ______________ __, ____
Name
---------------------------
- ------------------------------- (Please Print)
/ / / /- / / /- / / / / /
(Insert Social Security
or Other Identifying
Number of Holder) Address
-----------------------
-----------------------
Signature
----------------------
This Warrant may only be exercised by presentation to the Warrant Agent at one
of the following locations:
By hand at
By mail at
THE METHOD OF DELIVERY OF THIS WARRANT CERTIFICATE IS AT THE OPTION AND RISK OF
THE EXERCISING HOLDER AND THE DELIVERY OF THIS WARRANT CERTIFICATE WILL BE
DEEMED TO BE MADE ONLY WHEN ACTUALLY RECEIVED BY THE WARRANT AGENT. IF DELIVERY
IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS
RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE TIMELY
DELIVERY.
(Instructions as to form and delivery of Warrant Securities and/or Warrant
Certificates)
<PAGE>
Name in which Warrant Securities
are to be registered if other than
in the name of the registered holder
of this Warrant Certificate:
-----------------------------
Address to which Warrant Securities
are to be mailed if other than to the
address of the registered holder of
this Warrant Certificate as shown on
the books of the Warrant Agent:
-----------------------------
(Street Address)
-----------------------------
(City and State) (Zip Code)
<PAGE>
[EXCEPT FOR BOOK-ENTRY WARRANT CERTIFICATE:
Name in which Warrant Certificate
evidencing unexercised Warrants, if any,
are to be registered if other than in the
name of the registered holder of this
Warrant Certificate:
-----------------------------
Address to which certificate representing
unexercised Warrants, if any, are to be
mailed if other than to the address of
the registered holder of this Warrant
Certificate as shown on the books of
the Warrant Agent:
-----------------------------
(Street Address)
-----------------------------
(City and State) (Zip Code) ]
Dated:
-----------------------------
Signature
([EXCEPT FOR BOOK-ENTRY WARRANT
CERTIFICATE: Signature must conform
in all respects to the name of the
holder as specified on the face of
this Warrant Certificate.] If
Warrant Securities, or a Warrant
Certificate evidencing unexercised
Warrants, are to be issued in a
name other than that of the
registered holder hereof or are to
be delivered to an address other
than the address of such holder as
shown on the books of the Warrant
Agent, the above signature must be
guaranteed by a member firm of a
registered national stock exchange,
a member of the National
Association of Securities Dealers,
Inc., a participant in the
<PAGE>
Security Transfer Agents Medallion
Program or the Stock Exchange
Medallion Program, or by a
commercial bank or trust company
having an office or correspondent
in the United States.)
SIGNATURE GUARANTEE
Name of Firm
-----------------
Address
----------------------
Area Code
and Number
-------------------
Authorized
Signature
--------------------
Name
-------------------------
Title
------------------------
Dated: ,
---------------- ----
<PAGE>
ASSIGNMENT
(FORM OF ASSIGNMENT TO BE EXECUTED IF WARRANT HOLDER
DESIRES TO TRANSFER WARRANTS EVIDENCED HEREBY)
FOR VALUE RECEIVED, _________________ hereby sell(s), assign(s) and
transfer(s) unto ________________________________
- ----------------------------------- ------------------------
(Please print name and address (Please insert social security or
including zip code of assignee) other identifying number of assignee)
the rights represented by the within Warrant Certificate and does hereby
irrevocably constitute and appoint ____________ Attorney to transfer said
Warrant Certificate on the books of the Warrant Agent with full power of
substitution in the premises.
Dated:
-------------------------------------
Signature
(Signature must conform in all respects to the
name of the holder as specified on the face of
this Warrant Certificate and must bear a signature
guarantee by a member firm of a registered
national securities exchange, a member of the
National Association of Securities Dealers, Inc.,
a participant in the Security Transfer Agents
Medallion Program or the Stock Exchange Medallion
Program, or by a commercial bank or trust company
having an office or correspondent in the United
States)
SIGNATURE GUARANTEE
Name of Firm
-----------------
Address
----------------------
Area Code
and Number
-------------------
Authorized
Signature
--------------------
Name
-------------------------
Title
------------------------
Dated: ,
---------------- ----
<PAGE>
Exhibit 4.6
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PRIME GROUP REALTY TRUST
AND
,
---------------------------------------
as Purchase Contract Agent
-----------------
PURCHASE CONTRACT AGREEMENT
-----------------
Dated as of ,
------------ ----
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
PARTIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions . . . . . . . . . . . . . . . . . . . . . . . 1
Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Affiliate . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Applicable Market Value . . . . . . . . . . . . . . . . . . . . 2
Board of Trustees . . . . . . . . . . . . . . . . . . . . . . . 2
Board Resolution. . . . . . . . . . . . . . . . . . . . . . . . 2
Business Day. . . . . . . . . . . . . . . . . . . . . . . . . . 2
Closing Price . . . . . . . . . . . . . . . . . . . . . . . . . 2
Collateral Agent. . . . . . . . . . . . . . . . . . . . . . . . 2
Common Shares . . . . . . . . . . . . . . . . . . . . . . . . . 2
Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Contract Fee. . . . . . . . . . . . . . . . . . . . . . . . . . 3
Corporate Trust Office. . . . . . . . . . . . . . . . . . . . . 3
Current Market Price. . . . . . . . . . . . . . . . . . . . . . 3
Depositary. . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Early Settlement. . . . . . . . . . . . . . . . . . . . . . . . 3
Early Settlement Amount . . . . . . . . . . . . . . . . . . . . 3
Early Settlement Date . . . . . . . . . . . . . . . . . . . . . 3
Early Settlement Rate . . . . . . . . . . . . . . . . . . . . . 3
Exchange Act. . . . . . . . . . . . . . . . . . . . . . . . . . 3
Excess Underlying Securities. . . . . . . . . . . . . . . . . . 3
Expiration Date . . . . . . . . . . . . . . . . . . . . . . . . 3
Expiration Time . . . . . . . . . . . . . . . . . . . . . . . . 3
Final Settlement Date . . . . . . . . . . . . . . . . . . . . . 3
Final Settlement Fund . . . . . . . . . . . . . . . . . . . . . 3
Global Security Certificate . . . . . . . . . . . . . . . . . . 3
Holder. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Issuer Order. . . . . . . . . . . . . . . . . . . . . . . . . . 4
Issuer Request. . . . . . . . . . . . . . . . . . . . . . . . . 4
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
NYSE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Officers' Certificate . . . . . . . . . . . . . . . . . . . . . 4
Opinion of Counsel. . . . . . . . . . . . . . . . . . . . . . . 4
Outstanding Securities. . . . . . . . . . . . . . . . . . . . . 4
Outstanding Security Certificates . . . . . . . . . . . . . . . 4
Payment Date. . . . . . . . . . . . . . . . . . . . . . . . . . 5
Person. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Pledge. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Pledge Agreement. . . . . . . . . . . . . . . . . . . . . . . . 5
Predecessor Security Certificate. . . . . . . . . . . . . . . . 5
Purchase Contract . . . . . . . . . . . . . . . . . . . . . . . 5
Purchased Shares. . . . . . . . . . . . . . . . . . . . . . . . 5
Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Reorganization Event. . . . . . . . . . . . . . . . . . . . . . 5
Responsible Officer . . . . . . . . . . . . . . . . . . . . . . 5
Security. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Security Certificate. . . . . . . . . . . . . . . . . . . . . . 6
Security Register . . . . . . . . . . . . . . . . . . . . . . . 6
Security Registrar. . . . . . . . . . . . . . . . . . . . . . . 6
Settlement Rate . . . . . . . . . . . . . . . . . . . . . . . . 6
Stated Amount . . . . . . . . . . . . . . . . . . . . . . . . . 6
Termination Date. . . . . . . . . . . . . . . . . . . . . . . . 6
Termination Event . . . . . . . . . . . . . . . . . . . . . . . 6
Threshold Appreciation Price. . . . . . . . . . . . . . . . . . 6
TIA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Trading Day . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Underlying Securities . . . . . . . . . . . . . . . . . . . . . 7
Underwriting Agreement. . . . . . . . . . . . . . . . . . . . . 7
Vice President. . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 102. Compliance Certificates and Opinions. . . . . . . . . . . 7
Section 103. Form of Documents Delivered to Agent. . . . . . . . . . . 8
Section 104. Acts of Holders; Record Dates . . . . . . . . . . . . . . 8
Section 105. Notices, etc., to Agent and the Company . . . . . . . . .10
Section 106. Notice to Holders; Waiver . . . . . . . . . . . . . . . .10
Section 107. Effect of Headings and Table of Contents. . . . . . . . .11
Section 108. Successors and Assigns. . . . . . . . . . . . . . . . . .11
Section 109. Separability Clause . . . . . . . . . . . . . . . . . . .11
Section 110. Benefits of Agreement . . . . . . . . . . . . . . . . . .11
Section 111. Governing Law . . . . . . . . . . . . . . . . . . . . . .11
Section 112. Legal Holidays. . . . . . . . . . . . . . . . . . . . . .11
Section 113. Counterparts. . . . . . . . . . . . . . . . . . . . . . .12
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Section 114. Inspection of Agreement . . . . . . . . . . . . . . . . .12
ARTICLE TWO
Security Certificate Forms
Section 201. Forms of Security Certificates Generally. . . . . . . . .12
Section 202. Form of Agent's Certificate of Authentication . . . . . .13
ARTICLE THREE
The Securities
Section 301. Title and Terms; Denominations. . . . . . . . . . . . . .13
Section 302. Rights and Obligations Evidenced by the Security
Certificates. . . . . . . . . . . . . . . . . . . . . . .13
Section 303. Execution, Authentication, Delivery and Dating. . . . . .14
Section 304. Temporary Security Certificates . . . . . . . . . . . . .14
Section 305. Registration; Registration of Transfer and Exchange . . .15
Section 306. Mutilated, Destroyed, Lost and Stolen Security
Certificates. . . . . . . . . . . . . . . . . . . . . . .17
Section 307. Persons Deemed Owners . . . . . . . . . . . . . . . . . .18
Section 308. Cancellation. . . . . . . . . . . . . . . . . . . . . . .18
Section 309. Securities Not Separable. . . . . . . . . . . . . . . . .19
ARTICLE FOUR
The Underlying Securities
Section 401. Payment of Interest; Interest Rights Preserved. . . . . .19
Section 402. Transfer of Underlying Securities Upon Occurrence
of Termination Event. . . . . . . . . . . . . . . . . . .20
ARTICLE FIVE
The Purchase Contracts
Section 501. Purchase of Common Shares . . . . . . . . . . . . . . . .21
Section 502. Contract Fees . . . . . . . . . . . . . . . . . . . . . .22
Section 503. Deferral of Payment Dates For Contract Fee. . . . . . . .23
Section 504. Payment of Purchase Price . . . . . . . . . . . . . . . .23
Section 505. Issuance of Common Shares . . . . . . . . . . . . . . . .24
Section 506. Adjustment of Settlement Rate . . . . . . . . . . . . . .24
Section 507. Notice of Adjustments and Certain Other Events. . . . . .29
Section 508. Termination Event; Notice . . . . . . . . . . . . . . . .30
Section 509. Early Settlement. . . . . . . . . . . . . . . . . . . . .30
Section 510. No Fractional Shares. . . . . . . . . . . . . . . . . . .32
Section 511. Charges and Taxes . . . . . . . . . . . . . . . . . . . .32
ARTICLE SIX
</TABLE>
iii
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Remedies
Section 601. Unconditional Right of Holders to Receive Contract Fees
and to Purchase Common Shares . . . . . . . . . . . . . .32
Section 602. Restoration of Rights and Remedies. . . . . . . . . . . .33
Section 603. Rights and Remedies Cumulative. . . . . . . . . . . . . .33
Section 604. Delay or Omission Not Waiver. . . . . . . . . . . . . . .33
Section 605. Undertaking for Costs . . . . . . . . . . . . . . . . . .33
Section 606. Waiver of Stay or Extension Laws. . . . . . . . . . . . .34
ARTICLE SEVEN
The Agent
Section 701. Certain Duties and Responsibilities . . . . . . . . . . .34
Section 702. Notice of Default . . . . . . . . . . . . . . . . . . . .35
Section 703. Certain Rights of Agent . . . . . . . . . . . . . . . . .35
Section 704. Not Responsible for Recitals or Issuance of Securities. .36
Section 705. May Hold Securities . . . . . . . . . . . . . . . . . . .36
Section 706. Money Held in Trust . . . . . . . . . . . . . . . . . . .36
Section 707. Compensation and Reimbursement. . . . . . . . . . . . . .37
Section 708. Corporate Agent Required; Eligibility . . . . . . . . . .37
Section 709. Resignation and Removal; Appointment of Successor . . . .37
Section 710. Acceptance of Appointment by Successor. . . . . . . . . .39
Section 711. Merger, Conversion, Consolidation or Succession
to Business . . . . . . . . . . . . . . . . . . . . . . .39
Section 712. Preservation of Information; Communications to Holders. .39
Section 713. No Obligations of Agent . . . . . . . . . . . . . . . . .40
Section 714. Tax Compliance. . . . . . . . . . . . . . . . . . . . . .40
ARTICLE EIGHT
Supplemental Agreements
Section 801. Supplemental Agreements Without Consent of Holders. . . .41
Section 802. Supplemental Agreements with Consent of Holders . . . . .41
Section 803. Execution of Supplemental Agreements. . . . . . . . . . .42
Section 804. Effect of Supplemental Agreements . . . . . . . . . . . .42
Section 805. Reference to Supplemental Agreements. . . . . . . . . . .42
ARTICLE NINE
Consolidation, Merger, Sale or Conveyance
Section 901. Covenant Not to Merge, Consolidate, Sell or
Convey Property Except Under Certain Conditions . . . . .43
Section 902. Rights and Duties of Successor Entity . . . . . . . . . .43
Section 903. Opinion of Counsel to Agent . . . . . . . . . . . . . . .44
</TABLE>
iv
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
ARTICLE TEN
Covenants
Section 1001. Performance Under Purchase Contracts . . . . . . . . . .44
Section 1002. Maintenance of Office or Agency. . . . . . . . . . . . .44
Section 1003. Company to Reserve Common Shares . . . . . . . . . . . .45
Section 1004. Covenants as to Common Shares. . . . . . . . . . . . . .45
Section 1005. Statements of Officers of the Company as to Default. . .45
TESTIMONIUM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
</TABLE>
EXHIBIT A Form of Security Certificate
v
<PAGE>
This PURCHASE CONTRACT AGREEMENT, dated as of __________, ____,
is between PRIME GROUP REALTY TRUST, a Maryland real estate investment trust
(the "COMPANY"), and __________________________, acting as purchase contract
agent for the Holders of Securities from time to time (the "AGENT").
RECITALS
The Company has duly authorized the execution and delivery of
this Agreement and the Security Certificates evidencing the Securities.
All things necessary to make the Company's obligations under the
Securities, when the Security Certificates are executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the Agent, as
in this Agreement provided, the valid obligations of the Company, and to
constitute these presents a valid agreement of the Company, in accordance with
its terms, have been done.
WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. DEFINITIONS.
For all purposes of this Agreement, 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; and nouns and pronouns of the masculine gender
include the feminine and neuter genders; and
(2) the words "herein," "hereof" and "hereunder" and
other words of similar import refer to this Agreement as a whole
and not to any particular Article, Section or other subdivision.
1
<PAGE>
"ACT" when used with respect to any Holder, has the meaning
specified in SECTION 104.
"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 the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct 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 the Person named as the "Agent" in the first
paragraph of this instrument until a successor Agent shall have become such
pursuant to the applicable provisions of this Agreement, and thereafter "Agent"
shall mean the Person who is then the Agent hereunder.
"AGREEMENT" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"APPLICABLE MARKET VALUE" has the meaning specified in
SECTION 501.
"BOARD OF TRUSTEES" means the board of trustees of the Company or
a duly authorized committee of that board.
"BOARD RESOLUTION" means one or more resolutions of the Board of
Trustees, a copy of which has been certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Board of Trustees and
to be in full force and effect on the date of such certification and delivered
to the Agent.
"BUSINESS DAY" means any day that is not a Saturday, Sunday or a
day on which the NYSE or banking institutions or trust companies in The City of
New York are authorized or obligated by law or executive order to be closed.
"CLOSING PRICE" has the meaning specified in SECTION 501.
"COLLATERAL AGENT" means ________________________, as Collateral
Agent under the Pledge Agreement until a successor Collateral Agent shall have
become such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter "Collateral Agent" shall mean the Person who is then the Collateral
Agent thereunder.
"COMMON SHARES" means the common shares of beneficial interest,
par value $.01 per share, of the Company.
2
<PAGE>
"COMPANY" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such, and
thereafter "Company" shall mean such successor.
"CONTRACT FEE" means the fee payable by the Company in respect of
each Purchase Contract, equal to ___% per annum of the Stated Amount, accruing
from __________, , computed on the basis of the actual number of days
elapsed in a year of 365 or 366 days, as the case may be, plus any additional
fees accrued pursuant to SECTION 503.
"CORPORATE TRUST OFFICE" means the principal office of the Agent
in the [Borough of Manhattan, The City of New York], at which at any particular
time its corporate trust business shall be administered, which office at the
date hereof is located at [__________________, New York, New York _____].
"CURRENT MARKET PRICE" has the meaning specified in
SECTION 506(a)(8).
"DEPOSITARY" means a clearing agency registered under the
Exchange Act that is designated to act as Depositary for the Securities as
contemplated by SECTION 305.
"EARLY SETTLEMENT" has the meaning specified in SECTION 509(a).
"EARLY SETTLEMENT AMOUNT" has the meaning specified in
SECTION 509(a).
"EARLY SETTLEMENT DATE" has the meaning specified in
SECTION 509(a).
"EARLY SETTLEMENT RATE" has the meaning specified in SECTION
509(b).
"EXCHANGE ACT" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
"EXCESS UNDERLYING SECURITIES" has the meaning specified in
SECTION 402.
"EXPIRATION DATE" has the meaning specified in SECTION 104.
"EXPIRATION TIME" has the meaning specified in SECTION 506(a)(6).
"FINAL SETTLEMENT DATE" means __________, .
"FINAL SETTLEMENT FUND" has the meaning specified in SECTION 505.
"GLOBAL SECURITY CERTIFICATE" means a Security Certificate that
evidences all or part of the Securities and is registered in the name of a
Depositary or a nominee thereof.
3
<PAGE>
"HOLDER," when used with respect to a Security Certificate (or a
Security), means a Person in whose name the Security evidenced by such Security
Certificate (or the Security Certificate evidencing such Security) is registered
in the Security Register.
"ISSUER ORDER" or "ISSUER REQUEST" means a written order or
request signed in the name of the Company by its [Chairman of the Board, its
President or a Vice President and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary,] and delivered to the Agent.
"NYSE" has the meaning specified in SECTION 501.
"OFFICERS' CERTIFICATE" means a certificate signed by the
Chairman of the Board, any Vice Chairman of the Board, any Vice Chairman, the
President or any Vice President and by the Treasurer, an Assistant Treasurer,
the Secretary or an Assistant Secretary of the Company and delivered to the
Agent.
"OPINION OF COUNSEL" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company.
"OUTSTANDING SECURITIES" means, as of the date of determination,
all Securities evidenced by then Outstanding Security Certificates, except:
(i) If a Termination Event has occurred, Securities for which the
Underlying Securities have been theretofore deposited with the Agent in
trust for the Holders of such Securities; and
(ii) On and after the applicable Early Settlement Date, Securities
as to which the Holder has elected to effect Early Termination of the
related Purchase Contracts;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
number of Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Securities owned by the Company or any
Affiliate of the Company shall be disregarded and deemed not to be outstanding,
except that, in determining whether the Agent shall be protected in relying upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Securities which the Agent 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 Agent the
pledgee's right so to act with respect to such Securities and that the pledgee
is not the Company or any Affiliate of the Company.
"OUTSTANDING SECURITY CERTIFICATES" means, as of the date of
determination, all Security Certificates theretofore authenticated, executed and
delivered under this Agreement, except:
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(i) Security Certificates theretofore canceled by the Agent or
delivered to the Agent for cancellation; and
(ii) Security Certificates in exchange for or in lieu of which
other Security Certificates have been authenticated,
executed on behalf of the Holder and delivered pursuant to
this Agreement, other than any such Security Certificate
in respect of which there shall have been presented to the
Agent proof satisfactory to it that such Security
Certificate is held by a bona fide purchaser in whose
hands the Securities evidenced by such Security
Certificate are valid obligations of the Company.
"PAYMENT DATE" means each __________ and __________, commencing
__________, _____.
"PERSON" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PLEDGE" means the pledge under the Pledge Agreement of the
Underlying Securities constituting a part of the Securities.
"PLEDGE AGREEMENT" means the Pledge Agreement, dated as of the
date hereof, among the Company, the Collateral Agent and the Agent, on its own
behalf and as attorney-in-fact for the Holders from time to time of the
Securities.
"PREDECESSOR SECURITY CERTIFICATE" of any particular Security
Certificate means every previous Security Certificate evidencing all or a
portion of the rights and obligations of the Holder under the Securities
evidenced thereby; and, for the purposes of this definition, any Security
Certificate authenticated and delivered under Section 306 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security Certificate shall be
deemed to evidence the same rights and obligations of the Holder as the
mutilated, destroyed, lost or stolen Security Certificate.
"PURCHASE CONTRACT," when used with respect to any Security,
means the contract obligating the Company to sell and the Holder of such
Security to purchase Common Shares on the terms and subject to the conditions
set forth in Article Five hereof.
"PURCHASED SHARES" has the meaning specified in
SECTION 506(a)(6).
"RECORD DATE" for the interest and Contract Fees payable on any
Payment Date means the ______ or _______ (whether or not a Business Day), as the
case may be, next preceding such Payment Date.
"REORGANIZATION EVENT" has the meaning specified in SECTION
506(b).
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"RESPONSIBLE OFFICER," when used with respect to the Agent, means
any officer of the Agent assigned by the Agent to administer its corporate trust
matters.
"SECURITY" means the collective rights and obligations of a
Holder of a Security Certificate in respect of Underlying Securities with a
principal amount equal to the Stated Amount, subject to the Pledge thereof, and
a Purchase Contract.
"SECURITY CERTIFICATE" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Securities specified on
such certificate.
"SECURITY REGISTER" and "SECURITY REGISTRAR" have the respective
meanings specified in SECTION 305.
"SETTLEMENT RATE" has the meaning specified in SECTION 501.
"STATED AMOUNT" means $____________.
"TERMINATION DATE" means the date, if any, on which a Termination
Event occurs.
"TERMINATION EVENT" means the occurrence of any of the following
events: (i) at any time on or prior to the Final Settlement Date, a decree or
order by a court having jurisdiction in the premises shall have been entered
adjudging the Company a bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization of the Company under the United States
Bankruptcy Code or any other similar applicable Federal or State law, and,
unless such decree or order shall have been entered within 60 days prior to the
Final Settlement Date, such decree or order shall have continued undischarged
and unstayed for a period of 60 days; or (ii) a decree or order of a court
having jurisdiction in the premises for the appointment of a receiver or
liquidator or trustee or assignee in bankruptcy or insolvency of the Company or
of its property, or for the winding up or liquidation of its affairs, shall have
been entered, and, unless such decree or order shall have been entered within
60 days prior to the Final Settlement Date, such decree or order shall have
continued undischarged and unstayed for a period of 60 days, or (iii) at any
time on or prior to the Final Settlement Date the Company shall institute
proceedings to be adjudicated a bankrupt, or shall consent to the filing of a
bankruptcy proceeding against it, or shall file a petition or answer or consent
seeking reorganization under the United States Bankruptcy Code or any other
similar applicable Federal or State law, or shall consent to the filing of any
such petition, or shall consent to the appointment of a receiver or liquidator
or trustee or assignee in bankruptcy or insolvency of it or of its property, or
shall make an assignment for the benefit of creditors, or shall admit in writing
its inability to pay its debts generally as they become due.
"THRESHOLD APPRECIATION PRICE" has the meaning specified in
SECTION 501.
"TIA" means the Trust Indenture Act of 1939, as amended, or any
successor statute.
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"TRADING DAY" has the meaning specified in SECTION 501.
"UNDERLYING SECURITIES" means the [type and description of
underlying securities] pledged to the Collateral Agent pursuant to the Pledge.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement dated
__________, between the Company and
____________________________________________________, as representatives of the
several Underwriters named therein.
"VICE PRESIDENT" means any vice president, whether or not
designated by a number or a word or words added before or after the title "vice
president."
Section 102. COMPLIANCE CERTIFICATES AND OPINIONS.
Except as otherwise expressly provided by this Agreement, upon
any application or request by the Company to the Agent to take any action under
any provision of this Agreement, the Company shall furnish to the Agent an
Officers' Certificate stating that all conditions precedent, if any, provided
for in this Agreement 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 Agreement 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 Agreement shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) 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;
(3) 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 covenant or
condition has been complied with; and
(4) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied
with.
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Section 103. FORM OF DOCUMENTS DELIVERED TO AGENT.
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 of, or
representations by, counsel or an Opinion of Counsel, unless such officer knows,
or in the exercise of reasonable care should 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 of, or
representations by, counsel 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 with respect to such matters 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 Agreement, they may, but need not, be consolidated and
form one instrument.
Section 104. ACTS OF HOLDERS; RECORD DATES.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement 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 an 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 Agent 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
Agreement and (subject to SECTION 701) conclusive in favor of the Agent 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
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or affidavit shall also constitute sufficient proof of his authority. The fact
and date 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
Agent deems sufficient.
(c) The ownership of Securities shall be proved by the Security
Register.
(d) 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 Certificate
evidencing such 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 Agent or the Company in reliance thereon, whether or
not notation of such action is made upon such Security Certificate.
(e) The Company may set any day as a record date for the purpose
of determining the Holders of Outstanding Securities entitled to give, make or
take any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Agreement to be given, made or taken
by Holders of Securities. If any record date is set pursuant to this paragraph,
the Holders of Outstanding Securities on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date; PROVIDED, that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
by Holders of the requisite number of Outstanding Securities on such record
date. Nothing in this paragraph shall be construed to prevent the Company 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 cancelled and of no
effect), and nothing in this paragraph shall be construed to render ineffective
any action taken by Holders of the requisite number of Outstanding Securities on
the date such action is taken. Promptly after any record date is set pursuant
to this paragraph, the Company, at its own expense, shall cause notice of such
record date, the proposed action by Holders and the applicable Expiration Date
to be given to the Agent in writing and to each Holder of Securities in the
manner set forth in SECTION 106.
With respect to any record date set pursuant to this Section, the
Company may designate any date as the "Expiration Date" and from time to time
may change the Expiration Date to any earlier or later day; PROVIDED, that no
such change shall be effective unless notice of the proposed new Expiration Date
is given to the Agent in writing, and to each Holder of Securities in the manner
set forth in SECTION 106, on or prior to the existing Expiration Date. If an
Expiration Date is not designated with respect to any record date set pursuant
to this Section, the Company shall be deemed to have initially designated the
180th day after such record date as the Expiration Date with respect thereto,
subject to its right to change the Expiration Date as provided in this
paragraph. Notwithstanding the foregoing, no Expiration Date shall be later
than the 180th day after the applicable record date.
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Section 105. NOTICES, ETC., TO AGENT AND THE COMPANY.
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Agreement to be made upon, given or furnished to, or filed with,
(1) the Agent by any Holder or by the Company shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing
and personally delivered or mailed, first-class postage prepaid,
to the Agent at [Address], Attention: _________________________,
or at any other address previously furnished in writing by the
Agent to the Holders and the Company, or
(2) The Company by the Agent or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing
and personally delivered or mailed, first-class postage prepaid,
to the Company at Prime Group Realty Trust, 77 West Wacker Drive,
Suite 3900, Chicago, Illinois 60601 Attention: _________, or at
any other address previously furnished in writing to the Agent by
the Company.
Section 106. NOTICE TO HOLDERS; WAIVER.
Where this Agreement provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each Holder
affected by such event, at his address as it appears in the Security Register,
not later than the latest date, and not earlier than the earliest date,
prescribed for the giving of such notice. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Agreement 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
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Agent, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Agent shall
constitute a sufficient notification for every purpose hereunder.
Section 107. EFFECT OF 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.
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Section 108. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Agreement by the Company
shall bind its successors and assigns, whether so expressed or not.
Section 109. SEPARABILITY CLAUSE.
In case any provision in this Agreement or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions hereof and thereof shall not in any
way be affected or impaired thereby.
Section 110. BENEFITS OF AGREEMENT.
Nothing in this Agreement or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and, to the extent provided hereby, the Holders, any
benefits or any legal or equitable right, remedy or claim under this Agreement.
The Holders from time to time shall be beneficiaries of this Agreement and shall
be bound by all of the terms and conditions hereof and of the Securities
evidenced by their Security Certificates by their acceptance of delivery
thereof.
Section 111. GOVERNING LAW.
This Agreement and the Securities shall be governed by and
construed in accordance with the laws of the State of [New York], without regard
to the conflict of laws provisions thereof.
Section 112. LEGAL HOLIDAYS.
In any case where any Payment Date, any Early Settlement Date or
the Final Settlement Date shall not be a Business Day, then (notwithstanding any
other provision of this Agreement or of the Securities) payment in respect of
interest on Underlying Securities or Contract Fees shall not be made, Purchase
Contracts shall not be performed and Early Settlement shall not be effected on
such date, but such payments shall be made, or the Purchase Contracts shall be
performed or Early Settlement shall be effected, as applicable, on the next
succeeding Business Day with the same force and effect as if made on such
Payment Date, Early Settlement Date or Final Settlement Date, as the case may
be; PROVIDED, that no interest shall accrue or be payable by the Company or any
Holder for the period from and after any such Payment Date, Early Settlement
Date or Final Settlement Date, as the case may be, except that, if such next
succeeding Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day with the same force and
effect as if made on such Payment Date, Early Settlement Date or Final
Settlement Date, as the case may be.
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Section 113. COUNTERPARTS.
This Agreement may be executed in any number of counterparts,
each of which, when so executed, shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.
Section 114. INSPECTION OF AGREEMENT.
A copy of this Agreement shall be available at all reasonable
times at the Corporate Trust Office for inspection by any Holder.
ARTICLE TWO
Security Certificate Forms
Section 201. FORMS OF SECURITY CERTIFICATES GENERALLY.
The Security Certificates (including the form of Purchase
Contracts forming part of the Securities evidenced thereby) shall be in
substantially the form set forth in Exhibit A hereto, with such letters, numbers
or other marks of identification or designation and such legends or endorsements
printed, lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Securities are listed or any Depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Security Certificates, as evidenced by their execution of
the Security Certificates.
The definitive Security Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing the
Security Certificates, consistent with the provisions of this Agreement, as
evidenced by their execution thereof.
Every Global Security Certificate authenticated, executed on
behalf of the Holders and delivered hereunder shall bear a legend in
substantially the following form:
THIS SECURITY CERTIFICATE IS A GLOBAL SECURITY CERTIFICATE WITHIN THE
MEANING OF THE PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS
SECURITY CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS SECURITY
CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
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THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE
CONTRACT AGREEMENT.
Section 202. FORM OF AGENT'S CERTIFICATE OF AUTHENTICATION.
The form of the Agent's certificate of authentication of the
Securities shall be in substantially the form set forth on the form of the
Security Certificates.
ARTICLE THREE
The Securities
Section 301. TITLE AND TERMS; DENOMINATIONS.
The aggregate number of Securities evidenced by Security
Certificates authenticated, executed on behalf of the Holders and delivered
hereunder is limited to __________ [(subject to increase up to a maximum of
_________ to the extent the over-allotment option of the underwriters under the
Underwriting Agreement is exercised)], except for Security Certificates
authenticated, executed and delivered upon registration of transfer of, in
exchange for, or in lieu of, other Security Certificates pursuant to
SECTION 304, 305, 306, 509 or 805.
The Security Certificates shall be issuable only in registered
form and only in denominations of a single Security and any integral multiple
thereof.
Section 302. RIGHTS AND OBLIGATIONS EVIDENCED BY THE SECURITY CERTIFICATES.
Each Security Certificate shall evidence the number of Securities
specified therein, with each such Security representing the ownership by the
Holder thereof of Underlying Securities with a principal amount equal to the
Stated Amount, subject to the Pledge of such Underlying Securities by such
Holder pursuant to the Pledge Agreement, and the rights and obligations of the
Holder under one Purchase Contract. Prior to the purchase, if any, of Common
Shares under the Purchase Contracts, the Securities shall not entitle the
Holders to any of the rights of a holder of Common Shares, including, without
limitation, the right to vote or receive any dividends or other payments or to
consent or to receive notice as shareholders in respect of the meetings of
shareholders or for the election of trustees of the Company or for any other
matter, or any other rights whatsoever as shareholders, of the Company, except
to the extent otherwise expressly provided in this Agreement.
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Section 303. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
Upon the execution and delivery of this Agreement, and at any
time and from time to time thereafter, the Company may deliver Security
Certificates executed by the Company to the Agent for authentication, execution
on behalf of the Holders and delivery, together with its Issuer Order for
authentication of such Security Certificates, and the Agent in accordance with
such Issuer Order shall authenticate, execute on behalf of the Holder and
deliver such Security Certificates.
The Security Certificates shall be executed on behalf of the
Company by its [Chairman of the Board, its President or one of its Vice
Presidents]. The signature of any of these officers on the Security
Certificates may be manual or facsimile.
Security Certificates 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
Security Certificates or did not hold such offices at the date of such Security
Certificates.
No Purchase Contract underlying a Security evidenced by a
Security Certificate shall be valid until such Security Certificate has been
executed on behalf of the Holder by the manual signature of an authorized
signatory of the Agent, as such Holder's attorney-in-fact. Such signature by an
authorized signatory of the Agent shall be conclusive evidence that the Holder
of such Security Certificate has entered into the Purchase Contracts underlying
the Securities evidenced by such Security Certificate.
Each Security Certificate shall be dated the date of its
authentication.
No Security Certificate shall be entitled to any benefit under
this Agreement or be valid or obligatory for any purpose unless there appears on
such Security Certificate a certificate of authentication substantially in the
form provided for herein executed by an authorized signatory of the Agent by
manual signature, and such certificate upon any Security Certificate shall be
conclusive evidence, and the only evidence, that such Security Certificate has
been duly authenticated and delivered hereunder.
Section 304. TEMPORARY SECURITY CERTIFICATES.
Pending the preparation of definitive Security Certificates, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holders, and deliver, in lieu of such
definitive Security Certificates, temporary Security Certificates which are in
substantially the form set forth in Exhibit A hereto, with such letters, numbers
or other marks of identification or designation and such legends or endorsements
printed, lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Securities are listed,
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or as may, consistently herewith, be determined by the officers of the Company
executing such Security Certificates, as evidenced by their execution of the
Security Certificates.
If temporary Security Certificates are issued, the Company will
cause definitive Security Certificates to be prepared without unreasonable
delay. After the preparation of definitive Security Certificates, the temporary
Security Certificates shall be exchangeable for definitive Security Certificates
upon surrender of the temporary Security Certificates at the Corporate Trust
Office, at the expense of the Company and without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Security Certificates,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange therefor,
one or more definitive Security Certificates of authorized denominations and
evidencing a like number of Securities as the temporary Security Certificate or
Security Certificates so surrendered. Until so exchanged, the temporary
Security Certificates shall in all respects evidence the same benefits and the
same obligations with respect to the Securities evidenced thereby as definitive
Security Certificates.
Section 305. REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
The Agent shall keep at the Corporate Trust Office a register
(the register maintained in such office being herein referred to as the
"SECURITY REGISTER") in which, subject to such reasonable regulations as it may
prescribe, the Agent shall provide for the registration of Security Certificates
and of transfers of Security Certificates (the Agent, in such capacity, the
"SECURITY REGISTRAR").
Upon surrender for registration of transfer of any Security
Certificate at the Corporate Trust Office, the Company shall execute and deliver
to the Agent, and the Agent shall authenticate, execute on behalf of the
designated transferee or transferees, and deliver, in the name of the designated
transferee or transferees, one or more new Security Certificates of any
authorized denominations and evidencing a like number of Securities.
At the option of the Holder, Security Certificates may be
exchanged for other Security Certificates, of any authorized denominations and
evidencing a like number of Securities, upon surrender of the Security
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Security Certificates are so surrendered for exchange, the Company shall execute
and deliver to the Agent, and the Agent shall authenticate, execute on behalf of
the Holder, and deliver the Security Certificates which the Holder making the
exchange is entitled to receive.
All Security Certificates issued upon any registration of
transfer or exchange of a Security Certificate shall evidence the ownership of
the same number of Securities and be entitled to the same benefits and subject
to the same obligations, under this Agreement as the Securities evidenced by the
Security Certificate surrendered upon such registration of transfer or exchange.
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Every Security Certificate presented or surrendered for
registration of transfer or for exchange shall (if so required by the Agent) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Agent 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 exchange of a Security Certificate, but the Company and the Agent may require
payment from the Holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Security Certificates, other than any exchanges pursuant
to SECTIONS 306 and 805 not involving any transfer.
Notwithstanding the foregoing, the Company shall not be obligated
to execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder and deliver any Security
Certificate presented or surrendered for registration of transfer or for
exchange on or after the Final Settlement Date or the Termination Date. In lieu
of delivery of a new Security Certificate, upon satisfaction of the applicable
conditions specified above in this Section and receipt of appropriate
registration or transfer instructions from such Holder, the Agent shall (i) if
the Final Settlement Date has occurred, deliver the Common Shares issuable in
respect of the Purchase Contracts forming a part of the Securities evidenced by
such Security Certificate, or (ii) if a Termination Event shall have occurred
prior to the Final Settlement Date, transfer the principal amount of the
Underlying Securities evidenced thereby, in each case subject to the applicable
conditions and in accordance with the applicable provisions of ARTICLE FIVE.
The provisions of Clauses (1), (2), (3) and (4) below shall apply
only to Global Security Certificates:
(1) Each Global Security Certificate authenticated and executed
on behalf of the Holders under this Agreement shall be registered in the
name of the Depositary designated for such Global Security Certificate
or a nominee thereof and delivered to such Depositary or a nominee
thereof or custodian therefor, and each such Global Security Certificate
shall constitute a single Security Certificate for all purposes of this
Agreement.
(2) Notwithstanding any other provision in this Agreement, no
Global Security Certificate may be exchanged in whole or in part for
Security Certificates registered, and no transfer of a Global Security
Certificate in whole or in part may be registered, in the name of any
Person other than the Depositary for such Global Security Certificate or
a nominee thereof unless (A) such Depositary (i) has notified the
Company that it is unwilling or unable to continue as Depositary for
such Global Security Certificate or (ii) has ceased to be a clearing
agency registered under the Exchange Act or (b) there shall have
occurred and be continuing a default by the Company in respect to its
obligations under one or more Purchase Contracts.
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(3) Subject to Clause (2) above, any exchange of a Global
Security Certificate for other Security Certificates may be made in
whole or in part, and all Security Certificates issued in exchange for a
Global Security Certificate or any portion thereof shall be registered
in such names as the Depositary for such Global Security Certificate
shall direct.
(4) Every Security Certificate authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global
Security Certificate or any portion thereof, whether pursuant to this
Section, SECTION 304, 306, 509 or 805 or otherwise, shall be
authenticated, executed on behalf of the Holders and delivered in the
form of, and shall be, a Global Security Certificate, unless such
Security Certificate is registered in the name of a Person other than
the Depositary for such Global Security Certificate or a nominee
thereof.
Section 306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITY CERTIFICATES.
If any mutilated Security Certificate is surrendered to the
Agent, the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange therefor,
a new Security Certificate, evidencing the same number of Securities and bearing
a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Agent
(i) evidence to their satisfaction of the destruction, loss or theft of any
Security Certificate, and (ii) such security or indemnity as may be required by
them to save each of them and any agent of any of them harmless, then, in the
absence of notice to the Company or the Agent that such Security Certificate has
been acquired by a bona fide purchaser, the Company shall execute and deliver to
the Agent, and the Agent shall authenticate, execute on behalf of the Holder,
and deliver to the Holder, in lieu of any such destroyed, lost or stolen
Security Certificate, a new Security Certificate, evidencing the same number of
Securities and bearing a number not contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated
to execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder, and deliver to the Holder, a
Security Certificate on or after the Final Settlement Date or the Termination
Date. In lieu of delivery of a new Security Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt of
appropriate registration or transfer instructions from such Holder, the Agent
shall (i) if the Final Settlement Date has occurred, deliver the Common Shares
issuable in respect of the Purchase Contracts forming a part of the Securities
evidenced by such Security Certificate, or (ii) if a Termination Event shall
have occurred prior to the Final Settlement Date, transfer the principal amount
of the Underlying Securities evidenced thereby, in each case subject to the
applicable conditions and in accordance with the applicable provisions of
ARTICLE FIVE.
Upon the issuance of any new Security Certificate under this
Section, the Company and the Agent may require the payment of a sum sufficient
to cover any tax or other governmental
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charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Agent) connected therewith.
Every new Security Certificate issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security Certificate shall constitute an
original additional contractual obligation of the Company and of the Holder in
respect of the Security evidenced thereby, whether or not the destroyed, lost or
stolen Security Certificate shall be at any time enforceable by anyone, and
shall be entitled to all the benefits and be subject to all the obligations of
this Agreement equally and proportionately with any and all other Security
Certificates delivered 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 settlement of mutilated, destroyed, lost or stolen Security
Certificates.
Section 307. PERSONS DEEMED OWNERS.
Prior to due presentment of a Security Certificate for
registration of transfer, the Company and the Agent, and any agent of the
Company or the Agent, may treat the Person in whose name such Security
Certificate is registered as the owner of the Securities evidenced thereby, for
the purpose of receiving payments of interest on the Underlying Securities,
receiving payments of Contract Fees, performance of the Purchase Contracts and
for all other purposes whatsoever, whether or not the payment of interest on the
Underlying Securities or any Contract Fee payable in respect of the Purchase
Contracts constituting a part of the Securities evidenced thereby shall be
overdue and notwithstanding any notice to the contrary, and neither the Company
nor the Agent, nor any agent of the Company or the Agent, shall be affected by
notice to the contrary.
Notwithstanding the foregoing, with respect to any Global
Security Certificate, nothing herein shall prevent the Company, the Agent or any
agent of the Company or the Agent, from giving effect to any written
certification, proxy or other authorization furnished by any Depositary (or its
nominee), as a Holder, with respect to such Global Security Certificate or
impair, as between such Depositary and owners of beneficial interests in such
Global Security Certificate, the operation of customary practices governing the
exercise of rights of such Depositary (or its nominee) as Holder of such Global
Security Certificate.
Section 308. CANCELLATION.
All Security Certificates surrendered for delivery of Common
Shares on or after the Final Settlement Date, transfer of Underlying Securities
after the occurrence of a Termination Event or pursuant to an Early Settlement
or registration of transfer or exchange shall, if surrendered to any Person
other than the Agent, be delivered to the Agent and, if not already canceled,
shall be promptly canceled by it. The Company may at any time deliver to the
Agent for cancellation any Security Certificates previously authenticated,
executed and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Security Certificates so delivered shall, upon Issuer
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Order, be promptly canceled by the Agent. No Security Certificates shall be
authenticated, executed on behalf of the Holder and delivered in lieu of or in
exchange for any Security Certificates canceled as provided in this Section,
except as expressly permitted by this Agreement. All canceled Security
Certificates held by the Agent shall be disposed of as directed by Issuer Order.
If the Company or any Affiliate of the Company shall acquire any
Security Certificate, such acquisition shall not operate as a cancellation of
such Security Certificate unless and until such Security Certificate is
delivered to the Agent canceled or for cancellation.
Section 309. SECURITIES NOT SEPARABLE.
Notwithstanding anything contained herein or in the Security
Certificates to the contrary, for so long as the Purchase Contract underlying a
Security remains in effect such Security shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Security
in respect of the Underlying Securities and Purchase Contracts constituting such
Security may be acquired, and may be transferred and exchanged, only as a
Security. Other than a Security Certificate evidencing a Security, no Holder of
a Security, or any transferee thereof, shall be entitled to receive a
certificate evidencing the ownership of Underlying Securities or the rights and
obligations of the Holder and the Company under a Purchase Contract for so long
as the Purchase Contract underlying the Security remains in effect.
ARTICLE FOUR
The Underlying Securities
Section 401. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Interest on any Underlying Security which is paid on any Payment
Date shall, subject to receipt thereof by the Agent from the Collateral Agent as
provided by the terms of the Pledge Agreement, be paid to the Person in whose
name the Security Certificate (or one or more Predecessor Security Certificates)
of which such Underlying Security is a part is registered at the close of
business on the Record Date next preceding such Payment Date.
Each Security Certificate evidencing Underlying Securities
delivered under this Agreement upon registration of transfer of or in exchange
for or in lieu of any other Security Certificate shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by the Underlying
Securities underlying such other Security Certificate.
In the case of any Security with respect to which Early
Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date after any Record Date and on or prior to the next succeeding
Payment Date, interest on the Underlying Securities underlying such Security
otherwise payable on such Payment Date shall be payable on such Payment Date
notwithstanding
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such Early Settlement, and such interest shall, subject to receipt thereof by
the Agent, be paid to the Person in whose name the Security Certificate (or one
or more Predecessor Security Certificates) is registered at the close of
business on the Record Date. Except as otherwise expressly provided in the
immediately preceding sentence, in the case of any Security with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date, interest on the related Underlying Securities that would
otherwise be payable after the Early Settlement Date shall not be payable
hereunder to the Holder of such Security.
Section 402. Transfer of Underlying Securities Upon OCCURRENCE OF TERMINATION
EVENT.
Upon the occurrence of a Termination Event and the transfer to
the Agent of the Underlying Securities underlying such Securities pursuant to
the terms of the Pledge Agreement, the Agent shall request transfer instructions
with respect to such Underlying Securities from each Holder of Securities by
written request mailed to such Holder at his address as it appears in the
Security Register, in respect of the Underlying Securities underlying the
Security Certificate held by such Holder. Upon surrender to the Agent of a
Security Certificate with such transfer instructions in proper form for transfer
of the Underlying Securities by Federal Reserve Bank-Wire or other appropriate
procedure, the Agent shall transfer the Underlying Securities evidenced by such
Security Certificate to such Holder in accordance with such instructions. If a
Security Certificate is not duly surrendered to the Agent with appropriate
transfer instructions, the Agent shall hold the Underlying Securities evidenced
by such Security Certificate as custodian for the Holder of such Security
Certificate.
Underlying Securities shall be transferred only in denominations
of $1,000 and integral multiples thereof. As promptly as practicable following
the occurrence of a Termination Event, the Agent shall determine the excess of
(i) the aggregate principal amount of Underlying Securities underlying the
Outstanding Securities over (ii) the aggregate principal amount of Underlying
Securities in denominations of $1,000 and integral multiples thereof
transferrable to Holders of record on the date of such Termination Event (such
excess being herein referred to as the "EXCESS UNDERLYING SECURITIES"). As soon
as practicable after transfer to the Agent of the Underlying Securities
underlying the Outstanding Securities as provided in the Pledge Agreement, the
Agent shall sell the Excess Underlying Securities to or through one or more U.S.
Government securities dealers at then prevailing prices. The Agent shall deduct
from the proceeds of such sales all commissions and other out-of-pocket
transaction costs incurred in connection with such sales of Excess Underlying
Securities and, until the net proceeds of such sale or sales have been
distributed to Holders of the Securities, the Agent shall hold such proceeds in
trust for the Holders of Securities. Each Holder shall be entitled to receive a
portion, if any, of such net proceeds in lieu of Underlying Securities with a
principal amount of less than $1,000 determined by multiplying the aggregate
amount of such net proceeds by a fraction, the numerator of which is the
fraction of $1,000 in principal amount of Underlying Securities to which such
Holder would otherwise be entitled (after taking into account all Securities
then held by such Holder) and the denominator of which is the aggregate
principal amount of Excess Underlying Securities.
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ARTICLE FIVE
The Purchase Contracts
Section 501. PURCHASE OF COMMON SHARES.
Each Purchase Contract shall obligate the Holder of the related
Security to purchase, and the Company to sell, on the Final Settlement Date at a
price equal to the Stated Amount, a number of Common Shares to the Settlement
Rate, unless, on or prior to the Final Settlement Date, there shall have
occurred a Termination Event or an Early Settlement with respect to the Security
of which such Purchase Contract is a part. The "SETTLEMENT RATE" is equal to
(a) if the Applicable Market Value (as defined below) is greater than $_____
(the "THRESHOLD APPRECIATION PRICE"), _____ of a Common Share per Purchase
Contract, (b) if the Applicable Market Value is less than or equal to the
Threshold Appreciation Price but is greater than the Stated Amount, a fractional
Common Share per Purchase Contract equal to the Stated Amount divided by the
Applicable Market Value (rounded upward or downward to the nearest 1/10,000th of
a share) and (c) if the Applicable Market Value is less than or equal to the
Stated Amount, one Common Share per Purchase Contract, in each case subject to
adjustment as provided in SECTION 506. As provided in SECTION 510, no
fractional Common Shares will be issued upon settlement of Purchase Contracts.
The "APPLICABLE MARKET VALUE" means the average of the Closing
Price per Common Share on each of the twenty consecutive Trading Days ending on
the last Trading Day immediately preceding the Final Settlement Date. The
"CLOSING PRICE" of the Common Shares on any date of determination means the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Shares on the New York Stock Exchange (the "NYSE") on such
date or, if the Common Shares are not listed for trading on the NYSE on any such
date, as reported in the composite transactions for the principal United States
securities exchange on which the Common Shares are so listed, or if the Common
Shares are not so listed on a United States national or regional securities
exchange, as reported by Nasdaq, or, if the Common Shares are not so reported,
the last quoted bid price for the Common Shares in the over-the-counter market
as reported by the National Quotation Bureau or similar organization, or, if
such bid price is not available, the market value of the Common Shares on such
date as determined by a nationally recognized independent investment banking
firm retained for this purpose by the Company. A "TRADING DAY" means a day on
which the Common Shares (A) is not suspended from trading on any national or
regional securities exchange or association or over-the-counter market at the
close of business and (B) has traded at least once on the national or regional
securities exchange or association or over-the-counter market that is the
primary market for the trading of the Common Shares.
Each Holder of a Security Certificate evidencing Securities, by
his acceptance thereof, irrevocably authorizes the Agent to enter into and
perform the related Purchase Contracts on his behalf as his attorney-in-fact,
agrees to be bound by the terms and provisions thereof, covenants and agrees to
perform his obligations under such Purchase Contracts, consents to the
provisions hereof,
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irrevocably authorizes the Agent as his attorney-in-fact to enter into and
perform the Pledge Agreement on his behalf as his attorney-in-fact, and consents
to and agrees to be bound by the Pledge of the Underlying Securities underlying
such Security Certificate pursuant to the Pledge Agreement; PROVIDED, that upon
a Termination Event, the rights of the Holder of such Security under the
Purchase Contract may be enforced without regard to any other rights or
obligations. Each Holder of a Security, by his acceptance thereof, further
irrevocably covenants and agrees, that, to the extent and in the manner provided
in SECTION 504 and the Pledge Agreement, but subject to the terms thereof,
payments in respect of principal of the Underlying Securities on the Final
Settlement Date shall be paid by the Collateral Agent to the Company in
satisfaction of such Holder's obligations under such Purchase Contract and such
Holder shall acquire no right, title or interest in such payments.
Upon registration of transfer of a Security Certificate
evidencing Purchase Contracts, the transferee shall be bound (without the
necessity of any other action on the part of such transferee), under the terms
of this Agreement, the Purchase Contracts evidenced thereby and the Pledge
Agreement and the transferor shall be released from the obligations under the
Purchase Contracts evidenced by the Security Certificates so transferred. The
Company covenants and agrees, and each Holder of a Security Certificate, by his
acceptance thereof, likewise covenants and agrees, to be bound by the provisions
of this paragraph.
Section 502. CONTRACT FEES.
Subject to SECTION 503, the Company shall pay, on each Payment
Date, the Contract Fees payable in respect of each Purchase Contract to the
Person in whose name the Security Certificate (or one or more Predecessor
Security Certificates) evidencing such Purchase Contract is registered at the
close of business on the Record Date next preceding such Payment Date. The
Contract Fees will be payable at the office of the Agent in The City of New York
maintained for that purpose or, at the option of the Company, by check mailed to
the address of the Person entitled thereto at such address as it appears on the
Security Register.
Upon the occurrence of a Termination Event, the Company's
obligation to pay Contract Fees (including any accrued or deferred Contract
Fees) shall cease.
Each Security Certificate delivered under this Agreement upon
registration of transfer of, or in exchange for, or in lieu of, any other
Security Certificate shall carry the rights to Contract Fees accrued and unpaid,
and to accrue, which were carried by the Purchase Contracts evidenced by such
other Security Certificate.
Subject to SECTION 509, in the case of any Security with respect
to which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date after any Record Date and on or prior to the next
succeeding Payment Date, Contract Fees, if any, otherwise payable on such
Payment Date shall be payable on such Payment Date notwithstanding such Early
Settlement, and such Contract Fees shall be paid to the Person in whose name the
Security
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Certificate evidencing such Security (or one or more Predecessor Security
Certificates) is registered at the close of business on such Record Date.
Except as otherwise expressly provided in the immediately preceding sentence, in
the case of any Security with respect to which Early Settlement of the
underlying Purchase Contract is effected on an Early Settlement Date, Contract
Fees that would otherwise be payable after the Early Settlement Date with
respect to the Purchase Contract underlying such Security shall not be payable.
Section 503. DEFERRAL OF PAYMENT DATES FOR CONTRACT FEE.
The Company shall have the right, at any time prior to the Final
Settlement Date, to defer the payment of any or all of the Contract Fees
otherwise payable on any Payment Date, but only if the Company shall give the
Holders and the Agent written notice of its election to defer such payment
(specifying the amount to be deferred) at least ten Business Days prior to the
earlier of (i) the next succeeding Payment Date or (ii) the date the Company is
required to give notice of the Record or Payment Date with respect to payment of
such Contract Fees to the New York Stock Exchange or other applicable
self-regulatory organization or to Holders of the Securities, but in any event
not less than one Business Day prior to such Record Date. Any Contract Fees so
deferred shall bear additional Contract Fees thereon at the rate of _____% annum
(computed on the basis of the actual number of days elapsed in a year of 365 or
366 days, as the case may be), compounding on each succeeding Payment Date,
until paid in full. Deferred Contract Fees (and additional Contract Fees
accrued thereon) shall be due on the next succeeding Payment Date except to the
extent that payment is deferred pursuant to this Section. No Contract Fees may
be deferred to a date that is after the Final Settlement Date or, with respect
to any particular Purchase Contract, Early Settlement thereof. If the Purchase
Contracts are terminated upon the occurrence of a Termination Event, the
Holder's right to receive Contract Fees or deferred Contract Fees (and
additional Contract Fees accrued thereon) will terminate.
Section 504. PAYMENT OF PURCHASE PRICE.
The purchase price for the Common Shares purchased pursuant to a
Purchase Contract shall be paid by application of payments received by the
Company on the Final Settlement Date from the Collateral Agent pursuant to the
Pledge Agreement in respect of the principal of the Underlying Securities
pledged to secure the obligations of the relevant Holder under such Purchase
Contract. Such application shall satisfy in full the obligations under such
Purchase Contract of the Holder of the Security of which such Purchase Contract
is a part. The Company shall not be obligated to issue any Common Shares in
respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate purchase
price for the Common Shares to be purchased thereunder in the manner herein set
forth.
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Section 505. ISSUANCE OF COMMON SHARES.
Unless a Termination Event shall have occurred on or prior to the
Final Settlement Date or an Early Settlement shall have occurred, on the Final
Settlement Date, upon its receipt of payment in full of the purchase price for
the Common Shares purchased by the Holders pursuant to the foregoing provisions
of this Article, and subject to SECTION 506(b), the Company shall issue and
deposit with the Agent, for the benefit of the Holders of the Outstanding
Securities, one or more certificates representing the Common Shares registered
in the name of the Agent (or its nominee) as custodian for the Holders (such
certificates for Common Shares, together with any dividends or distributions for
which a record date and payment date for such dividend or distribution has
occurred after the Final Settlement Date, being hereinafter referred to as the
"FINAL SETTLEMENT FUND") to which the Holders are entitled hereunder. Subject
to the foregoing, upon surrender of a Security Certificate to the Agent on or
after the Final Settlement Date, together with settlement instructions thereon
duly completed and executed, the Holder of such Security Certificate shall be
entitled to receive in exchange therefor a certificate representing that number
of whole Common Shares which such Holder is entitled to receive pursuant to the
provisions of this ARTICLE FIVE (after taking into account all Securities then
held by such Holder) together with cash in lieu of fractional shares as provided
in SECTION 510 and any dividends or distributions with respect to such shares
constituting part of the Final Settlement Fund, but without any interest
thereon, and the Security Certificate so surrendered shall forthwith be
cancelled. Such shares shall be registered in the name of the Holder or the
Holder's designee as specified in the settlement instructions on the Security
Certificate.
If any Common Shares issued in respect of a Purchase Contract are
to be registered to a Person other than the Person in whose name the Security
Certificate evidencing such Purchase Contract is registered, no such
registration shall be made unless the Person requesting such registration has
paid any transfer and other taxes required by reason of such registration in a
name other than that of the registered Holder of the Security Certificate
evidencing such Purchase Contract or has established to the satisfaction of the
Company that such tax either has been paid or is not payable.
Section 506. ADJUSTMENT OF SETTLEMENT RATE.
(a) ADJUSTMENTS FOR DIVIDENDS, DISTRIBUTIONS, SHARE SPLITS, ETC.
(1) In case the Company shall pay or make a dividend or other
distribution on any class of Common Shares of the Company in Common Shares, the
Settlement Rate in effect at the opening of business on the day following the
date fixed for the determination of shareholders entitled to receive such
dividend or other distribution shall be increased by dividing such Settlement
Rate by a fraction of which the numerator shall be the number of Common Shares
outstanding at the close of business on the date fixed for such determination
and the denominator shall be the sum of such number of shares and the total
number of shares constituting such dividend or other distribution, such increase
to become effective immediately after the opening of business on the day
following the date fixed for such determination. For the purposes of this
paragraph (1), the number of
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Common Shares at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of Common Shares. The Company will not
pay any dividend or make any distribution on Common Shares held in the treasury
of the Company.
(2) In case the Company shall issue rights, options or warrants
to all holders of its Common Shares (not being available on an equivalent basis
to Holders of the Securities upon settlement of the Purchase Contracts
underlying such Securities) entitling them, for a period expiring within 45 days
after the record date for the determination of shareholderholders entitled to
receive such rights, options or warrants, to subscribe for or purchase Common
Shares at a price per share less than the Current Market Price per Common Share
on the date fixed for the determination of shareholders entitled to receive such
rights, options or warrants (other than pursuant to a dividend reinvestment
plan), the Settlement Rate in effect at the opening of business on the day
following the date fixed for such determination shall be increased by dividing
such Settlement Rate by a fraction of which the numerator shall be the number of
Common Shares outstanding at the close of business on the date fixed for such
determination plus the number of Common Shares which the aggregate of the
offering price of the total number of Common Shares so offered for subscription
or purchase would purchase at such Current Market Price and the denominator
shall be the number of Common Shares outstanding at the close of business on the
date fixed for such determination plus the number of Common Shares so offered
for subscription or purchase, such increase to become effective immediately
after the opening of business on the day following the date fixed for such
determination. For the purposes of this paragraph (2), the number of Common
Shares at any time outstanding shall not include shares held in the treasury of
the Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of Common Shares. The Company shall not issue any
such rights, options or warrants in respect of Common Shares held in the
treasury of the Company.
(3) In case outstanding Common Shares shall be subdivided or
split into a greater number of Common Shares, the Settlement Rate in effect at
the opening of business on the day following the day upon which such subdivision
or split becomes effective shall be proportionately increased, and, conversely,
in case outstanding Common Shares shall each be combined into a smaller number
of Common Shares, the Settlement Rate in effect at the opening of business on
the day following the day upon which such combination becomes effective shall be
proportionately reduced, such increase or reduction, as the case may be, to
become effective immediately after the opening of business on the day following
the day upon which such subdivision, split or combination becomes effective.
(4) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Shares evidences of its indebtedness or
assets (including securities, but excluding any rights or warrants referred to
in paragraph (2) of this Section, any dividend or distribution paid exclusively
in cash and any dividend or distribution referred to in paragraph (1) of this
Section), the Settlement Rate shall be adjusted so that the same shall equal the
rate determined by dividing the Settlement Rate in effect immediately prior to
the close of business on the date fixed for the determination of shareholders
entitled to receive such distribution by a fraction of which the numera-
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tor shall be the Current Market Price per Common Share on the date fixed for
such determination less the then fair market value (as determined by the Board
of Trustees, whose determination shall be conclusive and described in a Board
Resolution filed with the Agent) of the portion of the assets or evidences of
indebtedness so distributed applicable to one Common Share and the denominator
shall be such Current Market Price per Common Share, such adjustment to become
effective immediately prior to the opening of business on the day following the
date fixed for the determination of shareholders entitled to receive such
distribution. In any case in which this paragraph (4) is applicable,
paragraph (2) of this Section shall not be applicable.
(5) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Shares cash (excluding any cash that is
distributed in a Reorganization Event to which SECTION 506(b) applies or as part
of a distribution referred to in paragraph (4) of this Section) in an aggregate
amount that, combined together with (I) the aggregate amount of any other
distributions to all holders of its Common Shares made exclusively in cash
within the 12 months preceding the date of payment of such distribution and in
respect of which no adjustment pursuant to this paragraph (5) or paragraph (6)
of this Section has been made and (II) the aggregate of any cash plus the fair
market value (as determined by the Board of Trustees, whose determination shall
be conclusive and described in a Board Resolution) of any non-cash consideration
payable in respect of any tender or exchange offer by the Company or any of its
subsidiaries for all or any portion of the Common Shares concluded within the
12 months preceding the date of payment of such distribution and in respect of
which no adjustment pursuant to this paragraph (5) or paragraph (6) of this
Section has been made, exceeds 15% of the product of the Current Market Price
per Common Share on the date for the determination of holders of Common Shares
entitled to receive such distribution times the number of Common Shares
outstanding on such date, then, and in each such case, immediately after the
close of business on such date for determination, the Settlement Rate shall be
increased so that the same shall equal the rate determined by dividing the
Settlement Rate in effect immediately prior to the close of business on the date
fixed for determination of the shareholders entitled to receive such
distribution by a fraction (i) the numerator of which shall be equal to the
Current Market Price per Common Share on the date fixed for such determination
less an amount equal to the quotient of (x) the excess of such combined amount
over such 15% and (y) the number of Common Shares outstanding on such date for
determination and (ii) the denominator of which shall be equal to the Current
Market Price per Common Share on such date for determination.
(6) In case a tender or exchange offer made by the Company or
any subsidiary of the Company for all or any portion of the Common Shares shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to shareholders of an aggregate consideration
having a fair market value (as determined by the Board of Trustees, whose
determination shall be conclusive and described in a Board Resolution) that
combined together with (I) the aggregate of the cash plus the fair market value
(as determined by the Board of Trustees, whose determination shall be conclusive
and described in a Board Resolution), as of the expiration of the applicable
tender or exchange offer, of any non-cash consideration payable in respect of
any other tender or exchange offer, by the Company or any subsidiary of the
Company for all or any portion of the Common Shares expiring within the
12 months preceding the expiration of such tender
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or exchange offer and in respect of which no adjustment pursuant to
paragraph (5) of this Section or this paragraph (6) has been made and (II) the
aggregate amount of any distributions to all holders of the Company's Common
Shares made exclusively in cash within the 12 months preceding the expiration of
such tender or exchange offer and in respect of which no adjustment pursuant to
paragraph (5) of this Section or this paragraph (6) has been made, exceeds 15%
of the product of the Current Market Price per Common Share as of the last time
(the "EXPIRATION TIME") tenders could have been made pursuant to such tender or
exchange offer (as it may be amended) times the number of Common Shares
outstanding (including any tendered shares) on the Expiration Time, then, and in
each such case, immediately prior to the opening of business on the day after
the date of the Expiration Time, the Settlement Rate shall be adjusted so that
the same shall equal the rate determined by dividing the Settlement Rate
immediately prior to the close of business on the date of the Expiration Time by
a fraction (i) the numerator of which shall be equal to (A) the product of
(I) the Current Market Price per Common Share on the date of the Expiration Time
and (II) the number of Common Shares outstanding (including any tendered shares)
on the Expiration Time less (B) the amount of cash plus the fair market value
(determined as aforesaid) of the aggregate [non-cash] consideration payable to
shareholders pursuant to such tender or exchange offer, and (ii) the denominator
of which shall be equal to the product of (A) the Current Market Price per
Common Share as of the Expiration Time and (B) the number of Common Shares
outstanding (including any tendered shares) as of the Expiration Time less the
number of all shares accepted for payment pursuant to such tender or exchange
offer (the shares deemed so accepted, up to any such maximum, being referred to
as the "PURCHASED SHARES").
(7) The reclassification of Common Shares into securities
including securities other than Common Shares (other than any reclassification
upon a Reorganization Event to which Section 506(b) applies) shall be deemed to
involve (a) a distribution of such securities other than Common Shares to all
holders of Common Shares (and the effective date of such reclassification shall
be deemed to be "THE DATE FIXED FOR THE DETERMINATION OF SHAREHOLDERS ENTITLED
TO RECEIVE SUCH DISTRIBUTION" and the "DATE FIXED FOR SUCH DETERMINATION" within
the meaning of paragraph (4) of this Section), and (b) a subdivision, split or
combination, as the case may be, of the number of Common Shares outstanding
immediately prior to such reclassification into the number of Common Shares
outstanding immediately thereafter (and the effective date of such
reclassification shall be deemed to be "THE DAY UPON WHICH SUCH SUBDIVISION OR
SPLIT BECOMES EFFECTIVE" or "THE DAY UPON WHICH SUCH COMBINATION BECOMES
EFFECTIVE", as the case may be, and "THE DAY UPON WHICH SUCH SUBDIVISION, SPLIT
OR COMBINATION BECOMES EFFECTIVE" within the meaning of paragraph (3) of this
Section).
(8) The "CURRENT MARKET PRICE" per Common Shares on any day
means the average of the daily Closing Prices for the 5 consecutive Trading Days
selected by the Company commencing not more than 30 Trading Days before, and
ending not later than, the earlier of the day in question and the day before the
"ex" date with respect to the issuance or distribution requiring such
computation. For purposes of this paragraph, the term "ex date", when used with
respect to any issuance or distribution, shall mean the first date on which the
Common Shares trade regular way on such exchange or in such market without the
right to receive such issuance or distribution.
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(9) All adjustments to the Settlement Rate shall be calculated
to the nearest 1/10,000th of a Common Shares (or if there is not a nearest
1/10,000th of a share to the next lower 1/10,000th of a share). No adjustment
in the Settlement Rate shall be required unless such adjustment would require an
increase or decrease of at least one percent therein; PROVIDED, HOWEVER, that
any adjustments which by reason of this subparagraph are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
If an adjustment is made to the Settlement Rate pursuant to paragraphs (1), (2),
(3), (4), (5), (6), (7) or (10) of this SECTION 506(a), an adjustment shall also
be made to the Applicable Market Value solely to determine which of clauses (a),
(b) or (c) of the definition of Settlement Rate in SECTION 501 will apply on the
Final Settlement Date. Such adjustment shall be made by multiplying the
Applicable Market Value by a fraction of which the numerator shall be the
Settlement Rate immediately after such adjustment pursuant to paragraph (1),
(2), (3), (4), (5), (6), (7) or (10) of this SECTION 506(a) and the denominator
shall be the Settlement Rate immediately before such adjustment; PROVIDED,
HOWEVER, that if such adjustment to the Settlement Rate is required to be made
pursuant to the occurrence of any of the events contemplated by paragraphs (1),
(2), (3), (4), (5), (7) or (10) of this SECTION 506(a) during the period taken
into consideration for determining the Applicable Market Value, appropriate and
customary adjustments shall be made to the Settlement Rate.
(10) The Company may make such increases in the Settlement
Rate, in addition to those required by this Section, as it considers to be
advisable in order to avoid or diminish any income tax to any holders of Common
Shares resulting from any dividend or distribution of stock or issuance of
rights or warrants to purchase or subscribe for stock or from any event treated
as such for income tax purposes or for any other reasons.
(b) ADJUSTMENT FOR CONSOLIDATION, MERGER OR OTHER REORGANIZATION
EVENT. In the event of (i) any consolidation or merger of the Company, with or
into another Person (other than a merger or consolidation in which the Company
is the continuing entity and in which the Common Shares outstanding immediately
prior to the merger or consolidation is not exchanged for cash, securities or
other property of the Company or another entity), (ii) any sale, transfer, lease
or conveyance to another Person of the property of the Company as an entirety or
substantially as an entirety, (iii) any statutory exchange of securities of the
Company with another Person (other than in connection with a merger or
acquisition) or (iv) any liquidation, dissolution or winding up of the Company
other than as a result of or after the occurrence of a Termination Event (any
such event, a "REORGANIZATION EVENT"), the Settlement Rate will be adjusted to
provide that each Holder of Securities will receive on the Final Settlement Date
with respect to each Purchase Contract forming a part thereof, the kind and
amount of securities, cash and other property receivable upon such
Reorganization Event (without any interest thereon, and without any right to
dividends or distributions thereon which have a record date that is prior to the
Final Settlement Date) by a Holder of the number of Common Shares issuable on
account of each Purchase Contract if the Final Settlement Date had occurred
immediately prior to such Reorganization Event, assuming such Holder of Common
Shares is not a Person with which the Company consolidated or into which the
Company merged or which merged into the Company or to which such sale or
transfer was made, as the case may be ("CONSTITUENT PERSON"), or an Affiliate of
a constituent Person (to the extent such Reorganization Event provides
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for different treatment of Common Shares held by Affiliates of the Company and
non-Affiliates), and such Holder failed to exercise his rights of election, if
any, as to the kind or amount of securities, cash and other property receivable
upon such Reorganization Event (provided that if the kind or amount of
securities, cash and other property receivable upon such Reorganization Event is
not the same for each Common Shares held immediately prior to such
Reorganization Event by other than a constituent Person or an Affiliate thereof
and in respect of which such rights of election shall not have been exercised
("NON-ELECTING SHARE"), then for the purpose of this Section the kind and amount
of securities, cash and other property receivable upon such Reorganization Event
by each non-electing share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares). In the event
of such a Reorganization Event, the Person formed by such consolidation, merger
or exchange or the Person which acquires the assets of the Company or, in the
event of a liquidation or dissolution of the Company, the Company or a
liquidating trust created in connection therewith, shall execute and deliver to
the Agent an agreement supplemental hereto providing that the Holders of each
Outstanding Security shall have the rights provided by this SECTION 506. Such
supplemental agreement shall provide for adjustments which, for events
subsequent to the effective date of such supplemental agreement, shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section. The above provisions of this Section shall similarly apply to
successive Reorganization Events.
Section 507. NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.
(a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall:
(i) forthwith compute the adjusted Settlement Rate in
accordance with SECTION 506 and prepare and transmit to the Agent an
Officers' Certificate setting forth the Settlement Rate, the method of
calculation thereof in reasonable detail, and the facts requiring such
adjustment and upon which such adjustment is based; and
(ii) within 10 Business Days following the occurrence of an
event that permits or requires an adjustment to the Settlement Rate
pursuant to SECTION 506 (or if the Company is not aware of such
occurrence, as soon as practicable after becoming so aware), provide a
written notice to the Holders of the Securities of the occurrence of
such event and a statement in reasonable detail setting forth the method
by which the adjustment to the Settlement Rate was determined and
setting forth the adjusted Settlement Rate.
(b) The Agent shall not at any time be under any duty or
responsibility to any holder of Securities to determine whether any facts exist
which may require any adjustment of the Settlement Rate, or with respect to the
nature or extent or calculation of any such adjustment when made, or with
respect to the method employed in making the same. The Agent shall not be
accountable with respect to the validity or value (or the kind or amount) of any
Common Shares, or of any securities or property, which may at the time be issued
or delivered with respect to any Purchase Contract; and the Agent makes no
representation with respect thereto. The Agent shall not be responsible for any
failure of the Company to issue, transfer or deliver any Common Shares pursuant
to a Purchase
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Contract or to comply with any of the duties, responsibilities or covenants of
the Company contained in this Article.
Section 508. TERMINATION EVENT; NOTICE.
The Purchase Contracts and the obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights of
the Holders to receive and the obligation of the Company to pay any Contract
Fees or deferred Contract Fees, shall immediately and automatically terminate,
without the necessity of any notice or action by any Holder, the Agent or the
Company, if, on or prior to the Final Settlement Date, a Termination Event shall
have occurred. Upon the occurrence of a Termination Event, the Company shall
give written notice to the Agent, the Collateral Agent and to the Holders, at
their addresses as they appear in the Security Register. Upon and after the
occurrence of a Termination Event, the Securities shall thereafter represent the
right to receive the Underlying Securities forming a part of such Securities in
accordance with the provisions of SECTION 402 and the Pledge Agreement.
Section 509. EARLY SETTLEMENT.
(a) Subject to and upon compliance with the provisions of this
SECTION 509 at the option of the Holder thereof, any Purchase Contracts
underlying Securities having an aggregate Stated Amount equal to $[1,000] or an
integral multiple thereof may be settled early ("EARLY SETTLEMENT") as provided
herein. In order to exercise the right to effect Early Settlement with respect
to any Purchase Contracts, the Holder of the Security Certificate evidencing
such Purchase Contracts shall deliver such Security Certificate to the Agent at
the Corporate Trust Office duly endorsed for transfer to the Company or in blank
with the form of Election to Settle Early on the reverse thereof duly completed
and accompanied by payment in the form of a certified or cashier's check payable
to the Company in immediately available funds in an amount (the "EARLY
SETTLEMENT AMOUNT") equal to (i) the product of (A) the Stated Amount TIMES
(B) the number of Purchase Contracts with respect to which the Holder has
elected to effect Early Settlement MINUS (ii) the aggregate amount of Contract
Fees, if any, otherwise payable on or prior to the immediately preceding Payment
Date deferred at the option of the Company pursuant to SECTION 503 and remaining
unpaid as of such immediately preceding Payment Date PLUS (iii) if such delivery
is made with respect to any Purchase Contracts during the period from the close
of business on any Record Date next preceding any Payment Date to the opening of
business on such Payment Date, an amount equal to the sum of (x) the Contract
Fees payable on such Payment Date with respect to such Purchase Contracts PLUS
(y) the interest on the related Underlying Securities payable on such Payment
Date. Except as provided in the immediately preceding sentence and subject to
the [last] paragraph of SECTION 502, no payment or adjustment shall be made upon
Early Settlement of any Purchase Contract on account of any Contract Fees
accrued on such Purchase Contract or on account of any dividends on the Common
Shares issued upon such Early Settlement. If the foregoing requirements are
first satisfied with respect to Purchase Contracts underlying any Securities at
or prior to 5:00 p.m., New York City time, on a Business Day, such day shall be
the "EARLY SETTLEMENT DATE" with respect to such Securities and if such
requirements are first satisfied after 5:00 p.m., New York City time, on a
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Business Day or on a day that is not a Business Day, the "Early Settlement Date"
with respect to such Securities shall be the next succeeding Business Day.
(b) Upon Early Settlement of Purchase Contracts by a Holder of
the related Securities, the Company shall issue, and the Holder shall be
entitled to receive, a number of Common Shares on account of each Purchase
Contract as to which Early Settlement is effected equal to the Early Settlement
Rate; PROVIDED, HOWEVER, that upon the Early Settlement of the Purchase
Contracts, the Holder of such related Securities will forfeit the right to
receive any deferred Contract Fees. The Early Settlement Rate shall initially
be equal to __________ and shall be adjusted in the same manner and at the same
time as the Settlement Rate is adjusted. As promptly as practicable after Early
Settlement of Purchase Contracts in accordance with the provisions of this
SECTION 509, the Company shall issue and shall deliver to the Agent at the
Corporate Trust Office a certificate or certificates for the full number of
Common Shares issuable upon such Early Settlement together with payment in lieu
of any fraction of a share, as provided in SECTION 510.
(c) The Company shall cause the Common Shares issuable, and
Underlying Securities deliverable, upon Early Settlement of Purchase Contracts
to be issued and delivered, in the case of such Common Shares, and released from
the Pledge by the Collateral Agent and transferred, in the case of such
Underlying Securities, to the Purchase Contract Agent, for delivery to the
Holder thereof or its designee, no later than the third Business Day after the
applicable Early Settlement Date.
(d) Upon Early Settlement of any Purchase Contracts, and subject
to receipt thereof from the Company or the Collateral Agent, as applicable, the
Agent shall, in accordance with the instructions provided by the Holder thereof
on the applicable form of Election to Settle Early on the reverse of the
Security Certificate evidencing the related Securities, (i) transfer the
Underlying Securities forming a part of such Securities and (ii) deliver to the
Holder a certificate or certificates for the full number of Common Shares
issuable upon such Early Settlement together with payment in lieu of any
fraction of a share, as provided in SECTION 510.
(e) In the event that Early Settlement is effected with respect
to Purchase Contracts underlying less than all the Securities evidenced by a
Security Certificate, upon such Early Settlement the Company shall execute and
the Agent shall authenticate, countersign and deliver to the Holder thereof, at
the expense of the Company, a Security Certificate evidencing the Securities as
to which Early Settlement was not effected.
Section 510. NO FRACTIONAL SHARES.
No fractional shares or scrip representing fractional Common
Shares shall be issued or delivered upon settlement on the Final Settlement Date
or upon Early Settlement of any Purchase Contracts. If Security Certificates
evidencing more than one Purchase Contract shall be surrendered for settlement
at one time by the same Holder, the number of full Common Shares which shall be
delivered upon settlement shall be computed on the basis of the aggregate number
of Purchase
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Contracts evidenced by the Security Certificates so surrendered. Instead of any
fractional Common Shares which would otherwise be deliverable upon settlement of
any Purchase Contracts on the Final Settlement Date or upon Early Settlement,
the Company, through the Agent, shall make a cash payment in respect of such
fractional interest in an amount equal to the value of such fractional shares at
the Closing Price per share on the Trading Day immediately preceding the Final
Settlement Date or the related Early Settlement Date, respectively. The Company
shall provide the Agent from time to time with sufficient funds to permit the
Agent to make all cash payments required by this SECTION 510 in a timely manner.
Section 511. CHARGES AND TAXES.
The Company will pay all stock transfer and similar taxes
attributable to the initial issuance and delivery of the Common Shares pursuant
to the Purchase Contracts and in payment of any deferred Contract Fees;
PROVIDED, HOWEVER, that the Company shall not be required to pay any such tax or
taxes which may be payable in respect of any exchange of or substitution for a
Security Certificate evidencing a Purchase Contract or any issuance of a Common
Shares in a name other than that of the registered Holder of a Security
Certificate surrendered in respect of the Purchase Contracts evidenced thereby,
other than in the name of the Agent, as custodian for such Holder, and the
Company shall not be required to issue or deliver such share certificates or
Security Certificates unless or until the Person or Persons requesting the
transfer or issuance thereof shall have paid to the Company the amount of such
tax or shall have established to the satisfaction of the Company that such tax
has been paid.
ARTICLE SIX
Remedies
Section 601. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE CONTRACT FEES AND TO
PURCHASE COMMON SHARES.
Notwithstanding any other provision in this Agreement, the Holder
of any Security shall have the right, which is absolute and unconditional
(subject to the right of the Company to defer payment thereof pursuant to
SECTION 503), to receive payment of each installment of the Contract Fees with
respect to the Purchase Contract constituting a part of such Security on the
respective Payment Date for such Security and to purchase Common Shares pursuant
to such Purchase Contract and, in each such case, to institute suit for the
enforcement of any such payment and right to purchase Common Shares, and such
rights shall not be impaired without the consent of such Holder.
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Section 602. RESTORATION OF RIGHTS AND REMEDIES.
If any Holder of Securities has instituted any proceeding to
enforce any right or remedy under this Agreement and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company and such Holder shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of such Holder shall continue as though no such proceeding had been
instituted.
Section 603. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement of
mutilated, destroyed, lost or stolen Security Certificates in the last paragraph
of SECTION 306, no right or remedy herein conferred upon or reserved to the
Holders of Securities 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 right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
Section 604. DELAY OR OMISSION NOT WAIVER.
No delay or omission of any Holder to exercise any right or
remedy upon a default shall impair any such right or remedy or constitute a
waiver of any such right. Every right and remedy given by this Article or by
law to the Holders may be exercised from time to time, and as often as may be
deemed expedient, by such Holders.
Section 605. UNDERTAKING FOR COSTS.
All parties to this Agreement agree, and each Holder of any
Security by his acceptance of the Security Certificate evidencing such Security
shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or remedy under this Agreement, or in
any suit against the Agent for any action taken, suffered or omitted by it as
Agent, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; PROVIDED, that the provisions of
this Section shall not apply to any suit instituted by the Company, to any suit
instituted by the Agent, to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than 10% of the Outstanding Securities,
or to any suit instituted by any Holder for the enforcement of the payment of
the interest on any Underlying Security or the Contract Fees, if any, on any
Purchase Contract on or after the respective Payment Date therefor constituting
a part of the Securities held by such Holder, or for enforcement of the right to
purchase Common Shares under the Purchase Contracts constituting a part of the
Securities held by such Holder.
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Section 606. WAIVER OF 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 stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Agreement; 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 Agent or the Holders, but will suffer and permit the
execution of every such power as though no such law had been enacted.
ARTICLE SEVEN
The Agent
Section 701. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) (1) The Agent undertakes to perform, with respect to the
Securities, such duties and only such duties as are specifically set
forth in this Agreement, and no implied covenants or obligations shall
be read into this Agreement against the Agent; and
(2) in the absence of bad faith or negligence on its
part, the Agent may, with respect to the Securities, conclusively
rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions
furnished to the Agent and conforming to the requirements of this
Agreement, but in the case of any certificates or opinions which
by any provision hereof are specifically required to be furnished
to the Agent, the Agent shall be under a duty to examine the same
to determine whether or not they conform to the requirements of
this Agreement.
(b) No provision of this Agreement shall be construed to relieve
the Agent from liability for its own negligent action, its own negligent failure
to act, or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the
effect of Subsection (a) of this Section;
(2) the Agent shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it
shall be proved that the Agent was negligent in ascertaining the
pertinent facts; and
(3) no provision of this Agreement shall require the
Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of
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its duties hereunder, or in the exercise of any of its rights or powers,
if adequate indemnity is not provided to it.
(c) Whether or not therein expressly so provided, every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Agent shall be subject to the provisions of
this Section.
Section 702. NOTICE OF DEFAULT.
Within 90 days after the occurrence of any default by the Company
hereunder, of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to all Holders of Securities, as their names and
addresses appear in the Security Register, notice of such default hereunder,
unless such default shall have been cured or waived.
Section 703. CERTAIN RIGHTS OF AGENT.
Subject to the provisions of SECTION 701:
(a) the Agent may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by an Officers' Certificate, Issuer
Order or Issuer Request, and any resolution of the Board of Trustees of
the Company may be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Agreement the Agent
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Agent (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon an Officers' Certificate of the
Company;
(d) the Agent may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(e) the Agent 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
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indebtedness or other paper or document, but the Agent, in its
discretion, may make reasonable further inquiry or investigation into
such facts or matters related to the issuance of the Securities and the
execution, delivery and performance of the Purchase Contracts as it may
see fit, and, if the Agent shall determine to make such further inquiry
or investigation, it shall be entitled to examine the books, records and
promises of the Company, personally or by agent or attorney; and
(f) the Agent may execute any of its powers hereunder or perform
any duties hereunder either directly or by or through agents or
attorneys and the Agent shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care
by it hereunder.
Section 704. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Security Certificates
shall be taken as the statements of the Company and the Agent assumes no
responsibility for their correctness. The Agent makes no representations as to
the validity or sufficiency of this Agreement or of the Securities. The Agent
shall not be accountable for the use or application by the Company of the
proceeds in respect of the Purchase Contracts.
Section 705. MAY HOLD SECURITIES.
Any Security Registrar or any other agent of the Company, or the
Agent, in its individual or any other capacity, may become the owner or pledgee
of Securities and may otherwise deal with the Company with the same rights it
would have if it were not Security Registrar or such other agent, or the Agent.
Section 706. MONEY HELD IN TRUST.
Money held by the Agent in trust hereunder need not be segregated
from the other funds except to the extent required by law. The Agent shall be
under no obligation to invest or pay interest on any money received by it
hereunder except as otherwise agreed with the Company.
Section 707. COMPENSATION AND REIMBURSEMENT.
The Company agrees:
(1) to pay to the Agent from time to time reasonable
compensation for all services rendered by it hereunder;
(2) except as otherwise expressly provided herein, to reimburse
the Agent upon its request for all reasonable expenses, disbursements
and advances incurred or made by the Agent in accordance with any
provision of this Agreement (including
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the reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance as
may be attributable to its negligence or bad faith; and
(3) to indemnify the Agent and any predecessor Agent for, and to
hold each of them harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of its duties
hereunder, including the 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 hereunder.
Section 708. CORPORATE AGENT REQUIRED; ELIGIBILITY.
There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a member of a bank
holding company having) a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or State authority and having a
Corporate Trust Office in the [Borough of Manhattan, The City of New York], if
there be such a corporation in the [Borough of Manhattan, The City of New York]
qualified and eligible under this Article and willing to act on reasonable
terms. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation 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 Agent shall cease to be eligible in accordance with the provisions
of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
Section 709. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Agent and no appointment of
a successor Agent pursuant to this Article shall become effective until the
acceptance of appointment by the successor Agent in accordance with the
applicable requirements of SECTION 710.
(b) The Agent may resign at any time by giving written notice
thereof to the Company 60 days prior to the effective date of such resignation.
If the instrument of acceptance by a successor Agent required by SECTION 710
shall not have been delivered to the Agent within 30 days after the giving of
such notice of resignation, the resigning Agent may petition any court of
competent jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders
of a majority in number of the Outstanding Securities delivered to the Agent and
the Company.
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(d) If at any time
(1) the Agent fails to comply with Section 310(b) of the TIA, as
if the Agent were an indenture trustee under an indenture qualified
under the TIA, after written request therefor by the Company or by any
Holder who has been a bona fide Holder of a Security for at least six
months, or
(2) the Agent shall cease to be eligible under SECTION 708 and
shall fail to resign after written request therefor by the Company or by
any such Holder, or
(3) the Agent shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Agent or of its
property shall be appointed or any public officer shall take charge or
control of the Agent or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Agent, or (ii) 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 Agent and
the appointment of a successor Agent.
(e) If the Agent shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Agent for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Agent and
shall comply with the applicable requirements of SECTION 710. If no successor
Agent shall have been so appointed by the Company and accepted appointment in
the manner required by SECTION 710, 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
appointment of a successor Agent.
(f) The Company shall give, or shall cause such successor Agent
to give, notice of each resignation and each removal of the Agent and each
appointment of a successor Agent by mailing written notice of such event by
first-class mail, postage prepaid, to all Holders of Securities as their names
and addresses appear in the Security Register. Each notice shall include the
name of the successor Agent and the address of its Corporate Trust Office.
Section 710. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor Agent,
every such successor Agent so appointed shall execute, acknowledge and deliver
to the Company and to the retiring Agent an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Agent
shall become effective and such successor Agent, without any further act, deed
or conveyance, shall become vested with all the rights, powers, agencies and
duties of the retiring Agent; but, on the request of the Company or the
successor Agent, such retiring Agent shall, upon payment of its charges, execute
and deliver an instrument transferring to such successor Agent all the rights,
powers
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and trusts of the retiring Agent and shall duly assign, transfer and deliver to
such successor Agent all property and money held by such retiring Agent
hereunder.
(b) Upon request of any such successor Agent, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Agent all such rights, powers and agencies referred
to in paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at
the time of such acceptance such successor Agent shall be qualified and eligible
under this Article.
Section 711. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the 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 the Agent shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Agent, shall be the successor of the Agent hereunder; PROVIDED, such
corporation shall be otherwise 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 Security Certificates shall have been
authenticated and executed on behalf of the Holders, but not delivered, by the
Agent then in office, any successor by merger, conversion or consolidation to
such Agent may adopt such authentication and execution and deliver the Security
Certificates so authenticated and executed with the same effect as if such
successor Agent had itself authenticated and executed such Securities.
Section 712. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(a) The Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders received by the Agent
in its capacity as Security Registrar.
(b) If three or more Holders (herein referred to as
"APPLICANTS") apply in writing to the Agent, and furnish to the Agent reasonable
proof that each such applicant has owned a Security for a period of at least six
months preceding the date of such application, and such application states that
the applicants desire to communicate with other Holders with respect to their
rights under this Agreement or under the Securities and is accompanied by a copy
of the form of proxy or other communication which such applicants propose to
transmit, then the Agent shall, within five Business Days after the receipt of
such application, afford such applicants access to the information preserved at
the time by the Agent in accordance with SECTION 712(a).
(c) Every Holder of Securities, by receiving and holding the
Security Certificates evidencing the same, agrees with the Company and the Agent
that none of the Company, the Agent nor any agent of any of them shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of the Holders in accordance with SECTION 712(b), regardless of
the source from which such information was derived.
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Section 713. NO OBLIGATIONS OF AGENT.
Except to the extent otherwise provided in this Agreement, the
Agent assumes no obligations and shall not be subject to any liability under
this Agreement or any Purchase Contract in respect of the obligations of the
Holder of any Security thereunder. The Company agrees, and each Holder of a
Security Certificate, by his acceptance thereof, shall be deemed to have agreed,
that the Agent's execution of the Security Certificates on behalf of the Holders
shall be solely as agent and attorney-in-fact for the Holders, and that the
Agent shall have no obligation to perform such Purchase Contracts on behalf of
the Holders, except to the extent expressly provided in ARTICLE FIVE.
Section 714. TAX COMPLIANCE.
(a) The Agent, on its own behalf and on behalf of the Company,
will comply with all applicable certification, information reporting and
withholding (including "backup" withholding) requirements imposed by applicable
tax laws, regulations or administrative practice with respect to (i) any
payments made with respect to the Securities or (ii) the issuance, delivery,
holding, transfer, redemption or exercise of rights under the Securities. Such
compliance shall include, without limitation, the preparation and timely filing
of required returns and the timely payment of all amounts required to be
withheld to the appropriate taxing authority or its designated agent.
(b) The Agent shall comply with any direction received from
the Company with respect to the application of such requirements to particular
payments or Holders or in other particular circumstances, and may for purposes
of this Agreement rely on any such direction in accordance with the provisions
of SECTION 701(a)(2).
(c) The Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such records
available on request to the Company or to its authorized representative.
ARTICLE EIGHT
Supplemental Agreements
Section 801. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company and the Agent, at
any time and from time to time, may enter into one or more agreements
supplemental hereto, in form satisfactory to the Company and the Agent, for any
of the following purposes:
(1) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the
covenants of the Company herein and in the Security Certificates;
or
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(2) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred upon
the Company; or
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(4) to make provision with respect to the rights of Holders
pursuant to the requirements of SECTION 506(b); or
(5) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other provisions
herein, or to make any other provisions with respect to such matters or
questions arising under this Agreement; PROVIDED, such action shall not
adversely affect the interests of the Holders.
Section 802. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority of
the Outstanding Securities, by Act of said Holders delivered to the Company and
the Agent, the Company when authorized by a Board Resolution, and the Agent may
enter into an agreement or agreements supplemental hereto for the purpose of
modifying in any manner the terms of the Securities, or the provisions of this
Agreement or the rights of the Holders in respect of the Securities; PROVIDED,
HOWEVER, that no such supplemental agreement shall, without the consent of the
Holder of each Outstanding Security affected thereby,
(1) change any Payment Date;
(2) change the amount or type of Underlying Securities
underlying a Security, impair the right of the Holder of any Security to
receive interest payments on the Underlying Securities or otherwise
adversely affect the Holder's rights in or to such Underlying
Securities;
(3) reduce any Contract Fees or change any place where, or the
coin or currency in which, any Contract Fees are payable;
(4) impair the right to institute suit for the enforcement of
any Purchase Contract;
(5) reduce the number of Common Shares to be purchased pursuant
to any Purchase Contract, increase the price to purchase Common Shares
upon settlement of any Purchase Contract, change the Final Settlement
Date or otherwise adversely affect the Holder's rights under any
Purchase Contract; or
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(6) reduce the percentage of the Outstanding Securities the
consent of whose Holders is required for any such supplemental
agreement.
It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental agreement,
but it shall be sufficient if such Act shall approve the substance thereof.
Section 803. EXECUTION OF SUPPLEMENTAL AGREEMENTS.
In executing, or accepting the additional agencies created by,
any supplemental agreement permitted by this Article or the modifications
thereby of the agencies created by this Agreement, the Agent shall be entitled
to receive and (subject to SECTION 701) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
agreement is authorized or permitted by this Agreement. The Agent may, but
shall not be obligated to, enter into any such supplemental agreement which
affects the Agent's own rights, duties or immunities under this Agreement or
otherwise.
Section 804. EFFECT OF SUPPLEMENTAL AGREEMENTS.
Upon the execution of any supplemental agreement under this
Article, this Agreement shall be modified in accordance therewith, and such
supplemental agreement shall form a part of this Agreement for all purposes; and
every Holder of Security Certificates theretofore or thereafter authenticated,
executed on behalf of the Holders and delivered hereunder shall be bound
thereby.
Section 805. REFERENCE TO SUPPLEMENTAL AGREEMENTS.
Security Certificates authenticated, executed on behalf of the
Holders and delivered after the execution of any supplemental agreement pursuant
to this Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Security Certificates so
modified as to conform, in the opinion of the Agent and the Company, to any such
supplemental agreement may be prepared and executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the Agent in
exchange for Outstanding Security Certificates.
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ARTICLE NINE
Consolidation, Merger, Sale or Conveyance
Section 901. COVENANT NOT TO MERGE, CONSOLIDATE, SELL OR CONVEY PROPERTY
EXCEPT UNDER CERTAIN CONDITIONS.
The Company covenants that it will not merge or consolidate with
any other Person or sell or convey all or substantially all of its assets to any
Person, except that the Company may merge or consolidate with, or sell or convey
all or substantially all of its assets to, any other Person, provided that
(i) the Company shall be the continuing entity, or the successor (if other than
the Company) shall be a entity organized and existing under the laws of the
United States of America or a State thereof and such entity shall assume the
obligations of the Company under the Purchase Contracts, this Agreement and the
Pledge Agreement by one or more supplemental agreements in form satisfactory to
the Agent and the Collateral Agent, executed and delivered to the Agent and the
Collateral Agent by such entity, and (ii) the Company or such successor entity,
as the case may be, shall not, immediately after such merger of consolidation,
or such sale or conveyance, be in default in the performance of any covenant or
condition hereunder, under any of the Securities or under the Pledge Agreement.
Section 902. RIGHTS AND DUTIES OF SUCCESSOR ENTITY.
In case of any such consolidation, merger, sale or conveyance and
upon any such assumption by the successor entity in accordance with SECTION 901,
such successor entity shall succeed to and be substituted for the Company with
the same effect as if it had been named herein as the Company. Such successor
entity thereupon may cause to be signed, and may issue either in its own name or
in the name of Prime Group Realty Trust, any or all of the Security Certificates
evidencing Securities issuable hereunder which theretofore shall not have been
signed by the Company and delivered to the Agent; and, upon the order of such
successor entity, instead of the Company, and subject to all the terms,
conditions and limitations in this Agreement prescribed, the Agent shall
authenticate and execute on behalf of the Holders and deliver any Security
Certificates which previously shall have been signed and delivered by the
officers of the Company to the Agent for authentication and execution, and any
Security Certificate evidencing Securities which such successor entity
thereafter shall cause to be signed and delivered to the Agent for that purpose.
All the Security Certificates so issued shall in all respects have the same
legal rank and benefit under this Agreement as the Security Certificates
theretofore or thereafter issued in accordance with the terms of this Agreement
as though all of such Security Certificates had been issued at the date of the
execution hereof.
In case of any such consolidation, merger, sale or conveyance
such change in phraseology and form (but not in substance) may be made in the
Security Certificates evidencing Securities thereafter to be issued as may be
appropriate.
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Section 903. OPINION OF COUNSEL TO AGENT.
The Agent, subject to SECTIONS 701 and 703, may receive an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale or conveyance, and any such assumption, complies with the provisions of
this Article and that all conditions precedent to the consummation of any such
consolidation, merger, sale, assignment, transfer, lease or conveyance have been
met.
ARTICLE TEN
Covenants
Section 1001. PERFORMANCE UNDER PURCHASE CONTRACTS.
The Company covenants and agrees for the benefit of the Holders
from time to time of the Securities that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
Section 1002. MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain in the [Borough of Manhattan, The City
of New York] an office or agency where Security Certificates may be presented or
surrendered for acquisition of Common Shares upon settlement or Early Settlement
and for transfer of Underlying Securities upon occurrence of a Termination
Event, where Security Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Company in
respect of the Securities and this Agreement may be served. The Company will
give prompt written notice to the Agent of the location, and any change in the
location, of 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 Agent
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office, and the Company hereby
appoints the Agent as its agent to receive all such presentations, surrenders,
notices and demands.
The Company may also from time to time designate one or more
other offices or agencies where Security Certificates 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 agency
in the [Borough of Manhattan, The City of New York] for such purposes. The
Company will give prompt written notice to the Agent of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates as the place of payment for the Securities the
Corporate Trust Office and appoints the Agent at its Corporate Trust Office as
paying agent in such city.
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Section 1003. COMPANY TO RESERVE COMMON SHARES.
The Company shall at all times prior to the Final Settlement Date
reserve and keep available, free from preemptive rights, out of its authorized
but unissued Common Shares the full number of Common Shares issuable against
tender of payment in respect of all Purchase Contracts constituting a part of
the Securities evidenced by Outstanding Security Certificates.
Section 1004. COVENANTS AS TO COMMON SHARES.
The Company covenants that all Common Shares which may be issued
against tender of payment in respect of any Purchase Contract constituting a
part of the Outstanding Securities will, upon issuance, be duly authorized,
validly issued, fully paid and nonassessable.
Section 1005. STATEMENTS OF OFFICERS OF THE COMPANY AS TO DEFAULT.
The Company will deliver to the Agent, within 120 days after the
end of each fiscal year of the Company ending after the date hereof, an
Officers' Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions hereof, and if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the day and year first above written.
PRIME GROUP REALTY TRUST
By:
----------------------------------------
----------------------------------------
as Agent
By:
----------------------------------------
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Exhibit 4.7
PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of __________, ____ (this "Agreement"),
among Prime Group Realty Trust, a Maryland real estate investment trust (the
"Company"), ______________________________, as collateral agent (in such
capacity, together with its successors in such capacity, the "COLLATERAL
AGENT"), and _________________________________, as Purchase Contract Agent and
as attorney-in-fact of the Holders (as hereinafter defined) from time to time of
the Securities (as hereinafter defined) (in such capacity, together with its
successors in such capacity, the "PURCHASE CONTRACT AGENT") under the Purchase
Contract Agreement (as hereinafter defined).
RECITALS
The Company and the Purchase Contract Agent are parties to the
Purchase Contract Agreement, dated as of the date hereof (as modified and
supplemented and in effect from time to time, the "PURCHASE CONTRACT
AGREEMENT"), pursuant to which there will be issued Automatic Common Exchanged
Securities (the "SECURITIES").
Each Security consists of (a) one Purchase Contract (as hereinafter
defined) and (b) [type and description of underlying securities] ("UNDERLYING
SECURITIES") having a principal amount equal to $__________ (the "STATED
AMOUNT") and maturing on __________, ____ (the "FINAL SETTLEMENT DATE"), subject
to the pledge of such Underlying Securities created hereby.
Pursuant to the terms of the Purchase Contract Agreement and the
Purchase Contracts, the Holders (as defined in the Purchase Contract Agreement)
from time to time of the Securities have irrevocably authorized the Purchase
Contract Agent, as attorney-in-fact of such Holders, among other things to
execute and deliver this Agreement on behalf of such Holders and to grant the
pledge provided hereby of the Underlying Securities constituting part of such
Securities as provided herein and subject to the terms hereof.
Accordingly, the Company, the Collateral Agent and the Purchase
Contract Agent, on its own behalf and as attorney-in-fact of the Holders from
time to time of the Securities, agree as follows:
Section 1. DEFINITIONS. For all purposes of this Agreement,
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; and
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(2) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision.
"ACT" has the meaning specified in the Purchase Contract Agreement.
"AGREEMENT" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"APPLICABLE TREASURY REGULATIONS" means Subpart O-Book-Entry
Procedure of Title 31 of the Code of Federal Regulations (31 CFR Section 306.115
et. seq.) and any other regulations of the United States Treasury Department
from time to time applicable to the transfer or pledge of book-entry U.S.
Treasury Securities.
"BUSINESS DAY" means any day that is not a Saturday, a Sunday or a day
on which the New York Stock Exchange or banking institutions or trust companies
in The City of New York are authorized or obligated by law or executive order to
be closed.
"COLLATERAL AGENT" has the meaning specified in the first paragraph of
this instrument.
"COMPANY" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such, and
thereafter "Company" shall mean such successor.
"EARLY SETTLEMENT" has the meaning specified in the Purchase Contract
Agreement.
"EARLY SETTLEMENT AMOUNT" has the meaning specified in the Purchase
Contract Agreement.
"FINAL SETTLEMENT DATE" has the meaning specified in the Recitals.
"HOLDER" when used with respect to a Security, or a Purchase Contract
constituting a part thereof, has the meaning specified in the Purchase Contract
Agreement.
"OPINION OF COUNSEL" has the meaning specified in the Purchase
Contract Agreement.
"OUTSTANDING SECURITIES" has the meaning specified in the Purchase
Contract Agreement.
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"OUTSTANDING SECURITY CERTIFICATES" has the meaning specified in the
Purchase Contract Agreement.
"PERSON" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PLEDGE" has the meaning specified in SECTION 2.
"PLEDGED UNDERLYING SECURITIES" has the meaning specified in
SECTION 2.
"PURCHASE CONTRACT" has the meaning specified in the Purchase Contract
Agreement.
"PURCHASE CONTRACT AGENT" has the meaning specified in the first
paragraph of this instrument.
"SECURITY" has the meaning specified in the Recitals.
"SECURITY CERTIFICATE" has the meaning specified in the Purchase
Contract Agreement.
"STATED AMOUNT" has the meaning specified in the Recitals.
"TERMINATION EVENT" has the meaning specified in the Purchase Contract
Agreement.
"UNDERLYING SECURITIES" has the meaning specified in the Recitals.
Section 2. THE PLEDGE. As collateral security for the performance
when due by the Holders from time to time of the Securities of their respective
obligations under the Purchase Contracts constituting part of such Securities,
such Holders acting through the Purchase Contract Agent, as their
attorney-in-fact, hereby pledge and grant to the Collateral Agent, for the
benefit of the Company, a security interest in all of the right, title and
interest of such Holders in the Underlying Securities constituting a part of
such Securities. Prior to or concurrently with the execution and delivery of
this Agreement, the initial Holders shall (i) cause the Underlying Securities to
be delivered to the Collateral Agent [by Federal Reserve Bank-Wire to the
account of the Collateral Agent designated by it for such purpose] and
(ii) [take appropriate action so that the applicable Federal Reserve Bank
through which such Underlying Securities have been purchased will reflect such
transfer and the Pledge by appropriate entries in its records in accordance with
Applicable Treasury Regulations] [take appropriate action to reflect such
transfer and the Pledge by appropriate entries in its records]. In addition,
the execution and delivery hereof by the Purchase Contract Agent and
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the Collateral Agent shall constitute (i) the notification to the Collateral
Agent (as bailee or otherwise) of the Pledge and (ii) an acknowledgment by the
Collateral Agent (as third party in possession or otherwise) of the Pledge and
of its holding of such Underlying Securities subject to the Pledge, in each
case, for purposes of perfecting the Pledge under [Applicable Treasury
Regulations and other] applicable law, including, to the extent applicable, the
Uniform Commercial Code as adopted and in effect in any applicable jurisdiction.
The pledge provided in this SECTION 2 is herein referred to as the "PLEDGE" and
the Underlying Securities subject to the Pledge, excluding any Underlying
Securities released from the Pledge as provided in SECTION 4, are hereinafter
referred to as the "PLEDGED UNDERLYING SECURITIES." Subject to the Pledge, the
Holders from time to time of the Securities shall have full beneficial ownership
of the Underlying Securities constituting a part of such Securities.
Section 3. DISTRIBUTION OF PRINCIPAL AND INTEREST. (a) All payments
of principal of, or interest on, any Underlying Securities constituting part of
the Securities received by the Collateral Agent shall be paid by the Collateral
Agent by wire transfer in same day funds no later than ____________, [New York
City] time on the Business Day such interest payment is received by the
Collateral Agent (provided that in the event such interest payment is received
by the Collateral Agent on a day that is not a Business Day or after
____________, [New York City] time, on a Business Day, then such payment shall
be made no later than ____________, [New York City] time, on the next succeeding
Business Day) (i) in the case of (A) interest payments and (B) any principal
payments with respect to any Underlying Securities that have been released from
the Pledge pursuant to SECTION 4 hereof, to the Purchase Contract Agent to the
account designated by it for such purpose and (ii) in the case of principal
payments on any Pledged Underlying Securities, to the Company, in full
satisfaction of the respective obligations of the Holders of the Securities of
which such Pledged Underlying Securities are a part under the Purchase Contracts
forming a part of such Securities. All such payments received by the Purchase
Contract Agent as provided herein shall be applied by the Purchase Contract
Agent pursuant to the provisions of the Purchase Contract Agreement. If,
notwithstanding the foregoing, the Purchase Contract Agent shall receive any
payments of principal on account of any Pledged Underlying Securities, the
Purchase Contract Agent shall hold the same as trustee of an express trust for
the benefit of the Company (and promptly deliver over to the Company) for
application to the obligations of the Holders of the Securities of which such
Underlying Securities are a part under the Purchase Contracts relating to the
Securities of which such Underlying Securities are a part, and such Holders
shall acquire no right, title or interest in any such payments of principal so
received.
Section 4. RELEASE OF PLEDGED UNDERLYING SECURITIES. (a) Upon
notice to the Collateral Agent by the Company or the Purchase Contract Agent
that there has occurred a Termination Event, the Collateral Agent shall release
all Pledged Underlying Securities from the Pledge and shall transfer all such
Underlying Securities, free and clear of any lien, pledge or security interest
created hereby, to the Purchase Contract Agent.
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(b) Upon notice to the Collateral Agent by the Purchase Contract
Agent that one or more Holders of Securities have elected to effect Early
Settlement of their respective obligations under the Purchase Contracts forming
a part of such Securities in accordance with the terms of the Purchase Contracts
and the Purchase Contract Agreement, and that the Purchase Contract Agent has
received from such Holders, and paid to the Company, the related Early
Settlement Amounts pursuant to the terms of the Purchase Contracts and the
Purchase Contract Agreement and that all conditions to such Early Settlement
have been satisfied, then the Collateral Agent shall release from the Pledge
Pledged Underlying Securities with a principal amount equal to the product of
(i) the Stated Amount TIMES (ii) the number of such Purchase Contracts as to
which such Holders have elected to effect Early Settlement.
(c) Transfers of Underlying Securities pursuant to SECTION 4(a) or
(b) shall be by Federal Reserve Bank-Wire or in another appropriate manner,
(i) if the Collateral Agent shall have received such notification at or prior to
____________, [New York City] time, on a Business Day, then no later than
____________,[ New York City] time, on such Business Day and (ii) if the
Collateral Agent shall have received such notification on a day that is not a
Business Day or after ____________, [New York City] time, on a Business Day,
then no later than ____________, [New York City] time, on the next succeeding
Business Day.
Section 5. RIGHTS AND REMEDIES. (a) The Collateral Agent shall
have all of the rights and remedies with respect to the Pledged Underlying
Securities of a secured party under the Uniform Commercial Code as in effect in
the State of [New York] (the "CODE") (whether or not said Code is in effect in
the jurisdiction where the rights and remedies are asserted) and such additional
rights and remedies to which a secured party is entitled under the laws in
effect in any jurisdiction where any rights and remedies hereunder may be
asserted.
(b) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments to the Company on account of principal payments of any Pledged
Underlying Securities as provided in SECTION 3 hereof in satisfaction of the
obligations of the Holder of the Securities of which such Pledged Underlying
Securities are a part under the Purchase Contracts forming a part of such
Securities, the Collateral Agent shall have and may exercise, with reference to
such Pledged Underlying Securities and such obligations of such Holder, any and
all of the rights and remedies available to a secured party under the Code after
default by a debtor, and as otherwise granted herein or under any other law.
(c) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of principal of or interest on
the Pledged Underlying Securities.
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(d) The Purchase Contract Agent agrees that, from time to time, upon
the written request of the Collateral Agent, the Purchase Contract Agent shall
execute and deliver such further documents and do such other acts and things as
the Collateral Agent may reasonably request in order to maintain the Pledge, and
the perfection and priority thereof, and to confirm the rights of the Collateral
Agent hereunder.
Section 6. THE COLLATERAL AGENT. The Collateral Agent and the
Company hereby agree between themselves as follows (it being understood and
agreed that neither the Purchase Contract Agent nor any Holder of Securities
shall have any rights under this SECTION 6):
6.01. APPOINTMENT, POWERS AND IMMUNITIES. The Collateral Agent shall
act as agent for the Company hereunder with such powers as are specifically
vested in the Collateral Agent by the terms of this Agreement, together with
such other powers as are reasonably incidental thereto. The Collateral Agent:
(a) shall have no duties or responsibilities except those expressly set forth in
this Agreement and no implied covenants or obligations shall be inferred from
this Agreement against the Collateral Agent, nor shall the Collateral Agent be
bound by the provisions of any agreement by any party hereto beyond the specific
terms hereof; (b) shall not be responsible to the Company for any recitals
contained in this Agreement, or in any certificate or other document referred to
or provided for in, or received by it under, this Agreement, the Securities or
the Purchase Contract Agreement, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement (other than as
against the Collateral Agent), the Securities or the Purchase Contract Agreement
or any other document referred to or provided for herein or therein or for any
failure by the Company or any other Person (except the Collateral Agent) to
perform any of its obligations hereunder or thereunder; (c) shall not be
required to initiate or conduct any litigation or collection proceedings
hereunder (except pursuant to directions furnished under SECTION 6.02);
(d) shall not be responsible for any action taken or omitted to be taken by it
hereunder or under any other document or instrument referred to or provided for
herein or in connection herewith or therewith, except for its own negligence;
and (e) shall not be required to advise any party as to selling or retaining, or
taking or refraining from taking any action with respect to, any securities or
other property deposited hereunder.
No provision of this Agreement shall require the Collateral Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder. In no event shall the Collateral
Agent be liable for any amount in excess of the value of the Pledged Underlying
Securities.
6.02. INSTRUCTIONS OF THE COMPANY. The Company shall have the
right, by one or more instruments in writing executed and delivered to the
Collateral Agent, to direct the time, method and place of conducting any
proceeding for any right or remedy available to the Collateral Agent, or of
exercising any power conferred on the Collateral Agent, or to
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direct the taking or refraining from taking of any action authorized by this
Agreement; PROVIDED, HOWEVER, that (i) such direction shall not conflict with
the provisions of any law or of this Agreement and (ii) the Collateral Agent
shall be adequately indemnified as provided herein. Nothing in this SECTION
6.02 shall impair the right of the Collateral Agent in its discretion to take
any action or omit to take any action which it deems proper and which is not
inconsistent with such direction.
6.03. RELIANCE BY COLLATERAL AGENT. The Collateral Agent shall be
entitled to rely upon any certification, order, judgment, opinion, notice or
other communication (including, without limitation, any thereof by telephone,
telecopy, telex, telegram or cable) believed by it to be genuine and correct and
to have been signed or sent by or on behalf of the proper Person or Persons
(without being required to determine the correctness of any fact stated
therein), and upon advice and statements of legal counsel and other experts
selected by the Collateral Agent. As to any matters not expressly provided for
by this Agreement, the Collateral Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder in accordance with instructions
given by the Company in accordance with this Agreement.
6.04. RIGHTS IN OTHER CAPACITIES. The Collateral Agent and its
affiliates may (without having to account therefor to the Company) accept
deposits from, lend money to, make investments in and generally engage in any
kind of banking, trust or other business with the Purchase Contract Agent and
any Holder of Securities (and any of their subsidiaries or affiliates) as if it
were not acting as the Collateral Agent, and the Collateral Agent and its
affiliates may accept fees and other consideration from the Purchase Contract
Agent and any Holder of Securities without having to account for the same to the
Company, PROVIDED that the Collateral Agent covenants and agrees with the
Company that the Collateral Agent shall not accept, receive or permit there to
be created in its favor any security interest, lien or other encumbrance of any
kind in or upon the Pledged Underlying Securities.
6.05. NON-RELIANCE ON COLLATERAL AGENT. The Collateral Agent
shall not be required to keep itself informed as to the performance or
observance by the Purchase Contract Agent or any Holder of Securities of this
Agreement, the Purchase Contract Agreement, the Securities or any other document
referred to or provided for herein or therein or to inspect the properties or
books of the Purchase Contract Agent or any Holder of Securities. The
Collateral Agent shall not have any duty or responsibility to provide the
Company with any credit or other information concerning the affairs, financial
condition or business of the Purchase Contract Agent or any Holder of Securities
(or any of their affiliates) that may come into the possession of the Collateral
Agent or any of its affiliates.
6.06. COMPENSATION AND INDEMNITY. The Company agrees: (i) to pay
the Collateral Agent from time to time reasonable compensation for all services
rendered by its hereunder and (ii) to indemnify the Collateral Agent for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of
7
<PAGE>
or in connection with the acceptance or administration of its powers and duties
under this Agreement, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of
such powers and duties.
6.07. FAILURE TO ACT. In the event of any ambiguity in the
provisions of this Agreement or any dispute between or conflicting claims by or
among the undersigned and/or any other person or entity with respect to any
funds or property deposited hereunder, the Collateral Agent shall be entitled,
at its sole option, to refuse to comply with any and all claims, demands or
instructions with respect to such property or funds so long as such dispute or
conflict shall continue, and the Collateral Agent shall not be or become liable
in any way to any of the undersigned for its failure or refusal to comply with
such conflicting claims, demands or instructions. The Collateral Agent shall be
entitled to refuse to act until either (i) such conflicting or adverse claims or
demands shall have been finally determined by a court of competent jurisdiction
or settled by agreement between the conflicting parties as evidenced in a
writing, satisfactory to the Collateral Agent or (ii) the Collateral Agent shall
have received security or an indemnity satisfactory to the Collateral Agent
sufficient to save the Collateral Agent harmless from and against any and all
loss, liability or expense which the Collateral Agent may incur by reason of its
acting. The Collateral Agent may in addition elect to commence an interpleader
action or seek other judicial relief or orders as the Collateral Agent may deem
necessary. Notwithstanding anything contained herein to the contrary, the
Collateral Agent shall not be required to take any action that is in its opinion
contrary to law or to the terms of this Agreement, or which would in its opinion
subject it or any of its officers, employees or directors to liability.
6.08. RESIGNATION OF COLLATERAL AGENT. Subject to the appointment
and acceptance of a successor Collateral Agent as provided below, (a) the
Collateral Agent may resign at any time by giving notice thereof to the Company
and the Purchase Contract Agent, (b) the Collateral Agent may be removed at any
time by the Company and (c) if the Collateral Agent fails to perform any of its
material obligations hereunder in any material respect for a period of not less
than 20 days after receiving notice of such failure by the Purchase Contract
Agent and such failure shall be continuing, the Collateral Agent may be removed
by the Purchase Contract Agent. The Purchase Contract Agent shall promptly
notify the Company of any removal of the Collateral Agent pursuant to clause (c)
of the immediately preceding sentence. Upon any such resignation or removal,
the Company shall have the right to appoint a successor Collateral Agent. If no
successor Collateral Agent shall have been so appointed and shall have accepted
such appointment within 30 days after the retiring Collateral Agent's giving of
notice of resignation or such removal, then the retiring Collateral Agent may
petition any court of competent jurisdiction for the appointment of a successor
Collateral Agent. The Collateral Agent shall be a bank which has an office in
New York, New York with a combined capital and surplus of at least $50,000,000.
Upon the acceptance of any appointment as Collateral Agent hereunder by a
successor Collateral Agent, such successor Collateral Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Collateral Agent, and the retiring
8
<PAGE>
Collateral Agent shall take all appropriate action to transfer any money and
property held by it hereunder (including the Pledged Underlying Securities) to
such successor Collateral Agent. The retiring Collateral Agent shall, upon such
succession, be discharged from its duties and obligations as Collateral Agent
hereunder. After any retiring Collateral Agent's resignation hereunder as
Collateral Agent, the provisions of this SECTION 6 shall continue in effect for
its benefit in respect of any actions taken or omitted to be taken by it while
it was acting as the Collateral Agent.
6.09. RIGHT TO APPOINT AGENT OR ADVISOR. The Collateral Agent
shall have the right to appoint agents or advisors in connection with any of its
duties hereunder, and the Collateral Agent shall not be liable for any action
taken or omitted by such agents or advisors selected in good faith.
The provisions of this SECTION 6 shall survive termination of this
Agreement and the resignation or removal of the Collateral Agent.
Section 7. AMENDMENT.
7.01. AMENDMENT WITHOUT CONSENT OF HOLDERS. Without the consent
of any Holders, the Company, the Collateral Agent and the Purchase Contract
Agent, at any time and from time to time, may amend this Agreement, in form
satisfactory to the Company, the Collateral Agent and the Purchase Contract
Agent, for any of the following purposes:
(1) to evidence the succession of another Person to the Company, and
the assumption by any such successor of the covenants of the Company; or
(2) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the
Company; or
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Collateral Agent or Purchase Contract Agent; or
(4) to cure any ambiguity, to correct or supplement any provisions
herein which may be inconsistent with any other such provisions herein, or
to make any other provisions with respect to such matters or questions
arising under this Agreement, PROVIDED such action shall not adversely
affect the interests of the Holders.
7.02. AMENDMENT WITH CONSENT OF HOLDERS. With the consent of the
Holders of not less than a majority of the Outstanding Securities, by Act of
said Holders delivered to the Company, the Agent and the Collateral Agent, the
Company, when authorized by a Board Resolution, the Agent and the Collateral
Agent may amend this Agreement for the purpose of modifying in any manner the
provisions of this Agreement or
9
<PAGE>
the rights of the Holders in respect of the Securities; PROVIDED, HOWEVER, that
no such supplemental agreement shall, without the consent of the Holder of each
Outstanding Security affected thereby,
(1) change the amount or type of Underlying Securities underlying a
Security, impair the right of the Holder of any Security to receive
interest payments on the Underlying Securities or otherwise adversely
affect the Holder's rights in or to such Underlying Securities; or
(2) otherwise effect any action that would require the consent of the
Holder of each Outstanding Security affected thereby pursuant to the
Purchase Contract Agreement if such action were effected by an agreement
supplemental thereto; or
(3) reduce the percentage of Outstanding Securities the consent of
whose Holders is required for any such amendment.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed amendment, but it shall be
sufficient if such Act shall approve the substance thereof.
7.03. EXECUTION OF AMENDMENTS. In executing any amendment
permitted by this Section, the Collateral Agent and the Purchase Contract Agent
shall be entitled to receive and (subject to SECTION 6.01, with respect to the
Collateral Agent, and SECTION 701 of the Purchase Contract Agreement, with
respect to the Purchase Contract Agent) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement.
7.04. EFFECT OF AMENDMENTS. Upon the execution of any amendment
under this Section, this Agreement shall be modified in accordance therewith,
and such amendment shall form a part of this Agreement for all purposes; and
every Holder of Security Certificates theretofore or thereafter authenticated,
executed on behalf of the Holders and delivered under the Purchase Contract
Agreement shall be bound thereby.
7.05. REFERENCE TO AMENDMENTS. Security Certificates
authenticated, executed on behalf of the Holders and delivered after the
execution of any amendment pursuant to this Section may, and shall if required
by the Collateral Agent or the Purchase Contract Agent, bear a notation in form
approved by the Purchase Contract Agent and the Collateral Agent as to any
matter provided for in such amendment. If the Company shall so determine, new
Security Certificates so modified as to conform, in the opinion of the
Collateral Agent, the Purchase Contract Agent and the Company, to any such
amendment may be prepared and executed by the Company and authenticated,
executed on behalf of the
10
<PAGE>
Holders and delivered by the Purchase Contract Agent in accordance with the
Purchase Contract Agreement in exchange for Outstanding Security Certificates.
Section 8. MISCELLANEOUS.
8.01. NO WAIVER. No failure on the part of the Collateral Agent
or any of its agents to exercise, and no course of dealing with respect to, and
no delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise by the Collateral Agent
or any of its agents of any right, power or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other right, power or remedy.
The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
8.02. GOVERNING LAW. [THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. The Company,
the Collateral Agent and the Holders from time to time of the Securities, acting
through the Purchase Contract Agent as their attorney-in-fact, hereby submit to
the nonexclusive jurisdiction of the United States District Court for the
Southern District of New York and of any New York state court sitting in New
York City for the purposes of all legal proceedings arising out of or relating
to this Agreement or the transactions contemplated hereby. The Company, the
Collateral Agent and the Holders from time to time of the Securities, acting
through the Purchase Contract Agent as their attorney-in-fact, irrevocably
waive, to the fullest extent permitted by applicable law, any objection which
they may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum.]
8.03. NOTICES. All notices, requests, consents and other
communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be given
or made in writing (including, without limitation, by telecopy) delivered to the
intended recipient at the "Address for Notices" specified below its name on the
signature pages hereof or, as to any party, at such other address as shall be
designated by such party in a notice to the other parties. Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when transmitted by telecopier or personally delivered or, in the
case of a mailed notice, upon receipt, in each case given or addressed as
aforesaid.
8.04. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the respective successors and assigns of the
Company, the Collateral Agent and the Purchase Contract Agent, and the Holders
from time to time of the Securities, by their acceptance of the same, shall be
deemed to have agreed to be bound by the provisions hereof and to have ratified
the agreements of, and the grant of the Pledge hereunder by, the Purchase
Contract Agent.
11
<PAGE>
8.05. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
8.06. SEVERABILITY. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in order to carry out the
intentions of the parties hereto as nearly as may be possible and (ii) the
invalidity or unenforceability of any provision hereof in any jurisdiction shall
not affect the validity or enforceability of such provision in any other
jurisdiction.
8.07. EXPENSES, ETC. The Company agrees to reimburse the
Collateral Agent for: (a) all reasonable out-of-pocket costs and expenses of
the Collateral Agent (including, without limitation, the reasonable fees and
expenses of counsel to the Collateral Agent), in connection with (i) the
negotiation, preparation, execution and delivery or performance of this
Agreement and (ii) any modification, supplement or waiver of any of the terms of
this Agreement; (b) all reasonable costs and expenses of the Collateral Agent
(including, without limitation, reasonable fees and expenses of counsel) in
connection with (i) any enforcement or proceedings resulting or incurred in
connection with causing any Holder of Securities to satisfy its obligations
under the Purchase Contracts forming a part of the Securities and (ii) the
enforcement of this SECTION 8.07; and (c) all transfer, stamp, documentary or
other similar taxes, assessments or charges levied by any governmental or
revenue authority in respect of this Agreement or any other document referred to
herein and all costs, expenses, taxes, assessments and other charges incurred in
connection with any filing, registration, recording or perfection of any
security interest contemplated hereby.
8.08. SECURITY INTEREST ABSOLUTE. All rights of the Collateral
Agent and security interests hereunder, and all obligations of the Holders from
time to time of the Securities hereunder, shall be absolute and unconditional
irrespective of:
(a) any lack of validity or enforceability of any provision of
the Purchase Contracts or the Securities or any other agreement or
instrument relating thereto;
(b) any change in the time, manner or place of payment of, or
any other term of, or any increase in the amount of, all or any of the
obligations of Holders of Securities under the related Purchase
Contracts, or any other amendment or waiver of any term of, or any
consent to any departure from any requirement of, the Purchase
Contract Agreement or any Purchase Contract or any other agreement or
instrument relating thereto; or
(c) any other circumstance which might otherwise constitute a
defense available to, or discharge of, a borrower, a guarantor or a
pledgor.
12
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
PRIME GROUP REALTY TRUST
By:
----------------------------
Name:
Title:
Address for Notices:
77 West Wacker Drive
Suite 3900
Chicago, Illinois 60601
Attention:
Telecopy: ( ) ___-_____
,
----------------------------------
as Purchase Contract Agent and as
attorney-in-fact of the Holders
from time to time of the Securities
By:
----------------------------
Name:
Title:
Address for Notices:
[Address]
Attention:
,
----------------------------------
as Collateral Agent
By:
----------------------------
Name:
Title:
Address for Notices:
[Address]
Attention:
13
<PAGE>
[MILES & STOCKBRIDGE P.C. LETTERHEAD]
EXHIBIT 5.1
June 8, 1999
Prime Group Realty Trust
77 West Wacker Drive, Suite 3900
Chicago, Illinois 60601
Ladies and Gentlemen:
We have acted as special Maryland counsel to Prime Group Realty Trust, a
Maryland real estate investment trust (the "Company"), in connection with the
registration of certain securities of the Company (the "Offered Securities")
on its Registration Statement on Form S-3 (Registration No. 333-70369, the
"Registration Statement") filed by the Company with the Securities and
Exchange Commission under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to the Company's (i) common shares of
beneficial interest, $0.01 par value per share (the "Common Shares"); (ii)
preferred shares of beneficial interest, $0.01 par value per share (the
"Preferred Shares"); (iii) depositary shares representing Preferred Shares
(the "Depositary Shares"); (iv) senior debt securities (the "Senior Debt
Securities"); (v) subordinated debt securities (the "Subordinated Debt
Securities"); (vi) warrants to purchase Common Shares, Preferred Shares,
Senior Debt Securities, Subordinated Debt Securities, or Depositary Shares
(the "Warrants"); and (vii) contracts to purchase Common Shares or Preferred
Shares ("Share Purchase Contracts"), all of which may be issued from time to
time on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act at an aggregate public offering price not to exceed
$500,000,000.
We have examined the Registration Statement, including the exhibits
thereto, and such other documents, corporate records, laws and regulations as
we have deemed
<PAGE>
Prime Group Realty Trust
June 8, 1999
Page 2
necessary for the purposes of giving the opinions set forth in this opinion
letter. Based upon that examination and subject to the assumptions and
qualifications set forth herein, we are of the opinion that:
1. The Company has been duly organized and is a validly existing real
estate investment trust under the laws of the State of Maryland.
2. With respect to the Common Shares, when (i) the Common Shares have
been duly authorized by the Company's Board of Trustees, (ii) the Registration
Statement has become effective under the Securities Act, (iii) the terms of
the sale of the Common Shares have been duly established in conformity with
the Company's declaration of trust (the "Declaration of Trust") and its bylaws
(the "Bylaws"), which terms do not violate any applicable law or result in a
default under or breach of any agreement or instrument binding on the Company
and comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Company, and (iv) the Common
Shares have been issued and sold as contemplated by the Registration Statement
and consideration therefor received by the Company, the Common Shares will be
legally issued, fully paid and nonassessable.
3. With respect to the Preferred Shares, when (i) the Preferred Shares
have been duly authorized by the Company's Board of Trustees, (ii) the
Registration Statement has become effective under the Securities Act, (iii)
appropriate articles supplementary to the Declaration of Trust relating to a
class or series of the Preferred Shares to be sold under the Registration
Statement have been duly adopted by the Board of Trustees, have been filed
with and accepted for record by the State Department of Assessments and
Taxation of the State of Maryland and have become effective, (iv) the terms
of issuance and sale of shares of such class or series of Preferred Shares
have been duly established in conformity with the Declaration of Trust and
the Bylaws, which terms do not violate any applicable law or result in a
default under or breach of any agreement or instrument binding upon the
Company and comply with any requirement or restriction imposed by any court
or governmental body having jurisdiction over the Company, and (v) shares of
such class or series of Preferred Shares have been duly issued and sold as
contemplated by the Registration Statement and consideration therefor received
by the Company, such Preferred Shares will be legally issued, fully paid and
nonassessable.
4. With respect to the Warrants, when (i) the Registration Statement
has become effective under the Securities Act, (ii) a warrant agreement (the
"Warrant
<PAGE>
Prime Group Realty Trust
June 8, 1999
Page 3
Agreement") relating to the Warrants has been duly authorized, executed and
delivered and the Warrants and the securities of the Company into which the
Warrants will be exercisable have been duly authorized by the Company's Board
of Trustees, (iii) the terms of the Warrants and of their issuance and sale
have been duly established in conformity with the Warrant Agreement, which
terms do not violate any applicable law or result in a default under or
breach of any agreement or instrument binding upon the Company and comply
with any requirement or restriction imposed by any court or governmental body
having jurisdiction over the Company, and (iv) the Warrants have been duly
executed and countersigned in accordance with the Warrant Agreement and
issued and sold as contemplated by the Registration Statement and
consideration therefor received by the Company, the Warrants will constitute
valid and legally binding obligations of the Company, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and other laws
relating to or affecting creditors' rights and to general principles of
equity.
We express no opinion with respect to the laws of, or the effect or
applicability of the laws of, any jurisdiction other than the laws of the
State of Maryland. To the extent that any applicable document is stated to
be governed by the laws of another jurisdiction, we have assumed for
purposes of this opinion letter that the laws of such jurisdiction are
identical to the laws of the State of Maryland.
With respect to the issuance of Warrants to purchase Common Shares or
Preferred Shares, we have assumed that the Company will reserve for issuance
upon exercise of the Warrants a sufficient number of Common Shares or
Preferred Shares. With respect to the issuance of Common Shares or Preferred
Shares or of Warrants to purchase Common Shares or Preferred Shares, we have
assumed that any issuance thereof will not violate or otherwise conflict with
any provisions of the Declaration of Trust imposing ownership limitations on
equity shares of beneficial interest of the Company or otherwise relating
to its qualification as a real estate investment trust. With respect to the
issuance of Preferred Shares, we have assumed that the Company, immediately
following such issuance and after giving effect thereto and to the
application of the net proceeds therefrom, will comply with the covenant set
forth in Section 3.3.5(a)(ii) of the Declaration of Trust. Further, each of
our opinions is based on the assumption that the aggregate purchase price
paid for any Offered Securities, as well as any other Offered Securities
theretofore issued, does not exceed $500,000,000.
We have relied as to certain matters on information obtained from public
officials, officers of the Company and other sources believed by us to be
responsible. We have assumed that the Warrant Agreement will be duly
authorized, executed and delivered by the warrant agent to be named therein,
an assumption which we have not independently verified.
We hereby consent to the use of our name under the heading "Legal
Matters" in the Prospectus forming a part of the Registration Statement and
to the filing of this opinion
<PAGE>
Prime Group Realty Trust
June 8, 1999
Page 4
letter with the Registration Statement as Exhibit 5.1 thereto. In giving our
consent, we do not thereby admit that we are in the category of persons whose
consent is required under Section 7 of the Securities Act or the rules and
regulations of the Securities and Exchange Commission thereunder. The opinion
expressed herein is limited to the matters set forth in this letter and no
other opinion should be inferred beyond the matters expressly stated.
Very truly yours,
Miles & Stockbridge P.C.
By: /s/ J.W. Thompson Webb
-----------------------
Principal
<PAGE>
[Opinion of Winston & Strawn]
Exhibit 5.2
June 8, 1999
Board of Trustees
Prime Group Realty Trust
77 West Wacker Drive
Suite 3900
Chicago, Illinois 60601
Ladies and Gentlemen:
We have acted as special counsel to Prime Group Realty Trust, a Maryland
real estate investment trust (the "Company"), and are rendering this opinion
in connection with the Registration Statement on Form S-3 (File No. 333-70369),
which was initially filed by the Company with the Securities and Exchange
Commission (the "SEC") under the Securities Act of 1933, as amended (the
"Securities Act"), on January 11, 1999, as amended by Amendment No. 1 thereto
filed with the SEC on June 8, 1999 (as so amended, the "Registration
Statement"), with respect to the Company's (i) common shares of beneficial
interest, $0.01 par value per share (the "Common Shares"); (ii) preferred
shares of beneficial interest, $0.01 par value per share (the "Preferred
Shares"); (iii) depositary shares representing Preferred Shares (the
"Depositary Shares"); (iv) senior debt securities (the "Senior Debt
Securities"); (v) subordinated debt securities (the "Subordinated Debt
Securities" and, together with the Senior Debt Securities, the "Debt
Securities"); (vi) warrants to purchase Common Shares, Preferred Shares,
Senior Debt Securities, Subordinated Debt Securities, or Depositary Shares;
and (vii) contracts to purchase Common Shares or Preferred Shares (the "Share
Purchase Contracts"), all of which may be issued from time to time on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act at
an aggregate public offering price not to exceed $500,000,000.
We have examined the Registration Statement, including the exhibits
thereto, and such other documents, corporate records, and instruments and
have examined such laws and regulations as we have deemed necessary for the
purposes of this opinion letter. Based upon such examination, we are of the
following opinion:
1. With respect to the Senior Debt Securities and the Subordinated
Debt Securities, when (i) the Registration Statement has become effective
under the Securities Act, (ii) the Indenture relating to the applicable series
of Debt Securities has been duly authorized, executed, and delivered,
<PAGE>
(iii) the terms of such Senior Debt Securities or Subordinated Debt
Securities and of their issue and sale have been duly established in
conformity with resolutions of the Board of Trustees of the Company and in
conformity with the applicable Indenture, do not violate any applicable law
or result in a default under or breach of any agreement or instrument binding
upon the Company and comply with any requirement or restriction imposed by
any court or governmental body having jurisdiction over the Company, and (iv)
such Debt Securities have been duly executed and authenticated in accordance
with the applicable Indenture and issued and sold as contemplated in the
Registration Statement, such Debt Securities will constitute valid and
legally binding obligations of the Company, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws
of general applicability relating to or affecting creditors' rights and to
general equity principles.
2. With respect to the Depositary Shares, when (i) the Registration
Statement has become effective under the Securities Act, (ii) the deposit
agreement relating to the Depositary Shares (the "Deposit Agreement") has
been duly authorized, executed and delivered, (iii) the terms of the
Depositary Shares and of their issuance have been duly established in
conformity with the Deposit Agreement and do not violate any applicable law
or result in a default under or breach of any agreement or instrument binding
upon the Company and comply with any requirement or restriction imposed by
any court or governmental body having jurisdiction over the Company, (iv) the
class or series of Preferred Shares that is represented by the Depositary
Shares has been duly authorized, validly issued and delivered to the
depositary (the "Deposit Agreement"), (v) the Depositary Receipts evidencing
the Depositary Shares have been executed, countersigned and issued against
deposit of the class or series of Preferred Shares in accordance with the
Deposit Agreement, and (vi) the Depositary Shares have been issued and sold
as contemplated by the Registration Statement, the Depositary Shares will be
validly issued and the Depositary Receipts will entitle the holders thereof
to the rights specified in the Depositary Shares and the Deposit Agreement,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
3. With respect to the Share Purchase Contracts, when (i) the
Registration Statement has become effective under the Securities Act, (ii)
the purchase contract agreement relating to the Share Purchase Contracts (the
"Purchase Contract Agreement") has been duly authorized, executed and
delivered, (iii) the terms of the Share Purchase Contracts and of their
issuance and sale have been duly established in conformity with the Purchase
Contract Agreement, do not violate any applicable law or result in a default
under or breach of any agreement or instrument binding upon the Company and
comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Company, and (iv) the Share
Purchase Contracts have been duly executed and countersigned in accordance
with the Purchase Contract Agreement and issued and sold as contemplated by
the Registration Statement, the Share Purchase Contracts will constitute
valid and legally binding obligations of the Company, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws
of general applicability relating to or affecting creditors' rights and to
general equity principles.
We express no opinion with respect to the laws of, or the effect or
applicability of the laws of, any jurisdiction other than the laws of the
State of New York and United States federal laws. To the extent that any
applicable document is stated to be governed by the laws of another
jurisdiction,
<PAGE>
we have assumed for purposes of this opinion letter that the laws of such
jurisdiction are identical to the laws of the State of New York.
We have relied as to certain matters on information obtained from public
officials, officers of the Company, and other sources believed by us to be
responsible, and we have assumed that the Indentures will be duly authorized,
executed, and delivered by the respective Trustees thereunder, the Deposit
Agreement will be duly authorized, executed and delivered by the Depositary,
and the Purchase Contract Agreement will be duly authorized executed and
delivered by the purchase contract agent thereunder, assumptions which we have
not independently verified.
We hereby consent to the use of our name under the heading "Legal
Matters" in the Prospectus forming a part of the Registration Statement and
to the use of this opinion letter for filing with the Registration Statement
as Exhibit 5 thereto. In giving our consent, we do not thereby admit that we
are in the category of persons whose consent is required under Section 7 of
the Securities Act or the rules and regulations of the SEC thereunder.
Very truly yours,
/s/ Winston & Strawn
<PAGE>
Exhibit 8.1
[Winston & Strawn Letterhead]
June 8, 1999
Prime Group Realty Trust
77 West Wacker Drive
Suite 3900
Chicago, Il 60601
Re: Qualification as REIT and Prospectus Federal Income Tax Disclosure
Ladies and Gentlemen:
We have acted as special counsel to Prime Group Realty Trust, a
Maryland real estate investment trust (the "Company"), in connection with the
registration of certain of its Common Shares of Beneficial Interest, Preferred
Shares of Beneficial Interest, Depositary Shares representing Preferred Shares
of Beneficial Interest, Share Purchase Contracts, Debt Securities, Common Share
Warrants, Preferred Share Warrants, Depositary Share Warrants, and Debt
Warrants, as set forth in the Registration Statement on Form S-3 (Registration
No. 333-70369) initially filed with the Securities and Exchange Commission on
January 8, 1999 and as subsequently amended (the "Registration Statement") and
the Prospectus constituting a part thereof (the "Prospectus"). Capitalized terms
used herein and not otherwise defined herein shall have the meaning set forth in
the Prospectus.
You have requested our opinions concerning (i) whether, commencing
with the Company's initial taxable year ended December 31, 1997, the Company has
been and is organized in conformity with the requirements for qualification and
taxation as a real estate investment trust ("REIT") for federal income tax
purposes, (ii) whether the Company's method of operation has enabled it to meet
the requirements for qualification and taxation as a REIT under the provisions
of the Internal Revenue Code of 1986, as amended (the "Code"), (iii) whether
the Company's proposed method of operation enables it to continue to meet the
requirements for qualification and taxation as a REIT and (iv) whether the
discussion in the Prospectus under the heading "Material Federal Income Tax
Considerations" fairly summarizes the material federal income tax
considerations to the Company resulting from its treatment as a REIT. Any
material federal income tax considerations to any securityholder relating to a
particular offering of securities covered by the Prospectus will be described
in a particular Prospectus supplement to be filed at the time of any offering
of such securities.
In rendering this opinion, we have examined and relied upon the
descriptions of the Company, the Operating Partnership and the Property
Partnerships and their respective investments, as well as proposed investments,
activities, operations, and governance, as set forth in the Prospectus. We have
reviewed originals or copies, certified or otherwise identified to our
satisfaction, of the form of the Amended and Restated Declaration of Trust of
the Company (the "Charter"), the Amended and
<PAGE>
Prime Group Realty Trust
June 8, 1999
Page 2
Restated Agreement of Limited Partnership of Prime Group Realty Trust, L.P. (the
"Operating Partnership"), as amended, each of the Property Partnerships'
agreements as amended, the Registration Statement, the Prospectus and such
other documents, agreements, and information as we have deemed necessary for
purposes of rendering the opinions contained herein. For purposes of such
examination, we have assumed the genuineness of all signatures on originals or
copies, the legal capacity of natural persons, the authority of any individual
or individuals who executed any such documents on behalf of any other person,
the authenticity of all documents submitted to us as originals and the
conformity to originals or certified copies of all copies submitted to us as
certified or reproduction copies.
We have also reviewed and, with your permission, are relying upon the
Officer's Certificate executed by a duly authorized officer of the Company to
the best of his knowledge and belief as of March 31, 1998, as reaffirmed on the
date hereof, setting forth certain factual representations relating to the
formation, ownership, operation, future method of operation, and compliance with
the REIT and partnership provisions of the Code of the Company, the Operating
Partnership, each of the Property Partnerships, and Prime Group Realty Services,
Inc. (the "Services Company"). We have further relied on and assumed the truth
and correctness of (i) the Company's representations in the Agreement of Limited
Partnership of the Operating Partnership and (ii) the certificates of public
officials with respect to the formation of certain limited partnerships.
Moreover, for the purpose of rendering our opinion, we have assumed that no
partner in the Operating Partnership or any of the Property Partnerships will
elect to be excluded from all or part of subchapter K of the Code.
For the purposes of rendering this opinion, we have not made an
independent investigation of the facts set forth in any of the aforementioned
documents, including without limitation the Prospectus and the Officer's
Certificate. We have consequently relied upon your representations that the
information presented in such documents or otherwise furnished to us accurately
and completely describes all material facts relevant to this opinion.
In rendering this opinion, we have assumed that the transactions
contemplated by the Prospectus will be consummated in accordance with the
operative documents, and such documents accurately reflect the material facts
of such transactions. In addition, the opinions set forth herein are based on
the correctness of the following specific assumptions: (i) the Company, the
Operating Partnership, the Property Partnerships, and the Services Company will
each be operated in the manner described in the relevant partnership agreement
or other organizational documents and in the Prospectus and in accordance with
applicable laws; and (ii) each partner in the Operating Partnership and in each
of the Property Partnerships has been motivated in acquiring its respective
partnership interest by such partner's anticipation of economic rewards apart
from tax considerations.
Our opinion is based upon the current provisions of the Code,
Treasury Regulations promulgated thereunder, current administrative rulings,
judicial decisions, and other applicable authorities, all as in effect on the
date hereof. All of the foregoing authorities are subject to change or new
interpretation, both prospectively and retroactively, and such changes or
interpretation, as well as changes in the facts as they have been represented
to us or assumed by us, could affect our opinion. Our opinion is rendered only
as of the date hereof and we undertake no responsibility to update this opinion
<PAGE>
Prime Group Realty Trust
June 8, 1999
Page 3
after this date. Our opinion does not foreclose the possibility of a contrary
determination by the Internal Revenue Service (the "IRS") or by a court of
competent jurisdiction, or of a contrary position by the IRS or Treasury
Department in regulations or rulings issued in the future.
Based on the foregoing, and subject to the limitations, qualifications
and exceptions set forth herein, we are of the opinion that (i) commencing with
the Company's initial taxable year ending December 31, 1997, the Company has
been and is organized in conformity with the requirements for qualification as
a REIT, (ii) the Company's method of operation has enabled it to meet the
requirements for qualification and taxation as a REIT under the Code, (iii) the
Company's proposed method of operation will enable it to continue to meet the
requirements for qualification as a REIT, and (iv) the discussion in the
Prospectus under the heading "Material Federal Income Tax Considerations" fairly
summarizes the material federal income tax considerations to the Company
resulting from its treatment as a REIT. Any material federal income tax
considerations to any securityholder relating to a particular offering of
securities covered by the Prospectus will be described in a particular
Prospectus supplement to be filed at the time of any offering of such
securities.
The Company's qualification and taxation as a REIT depend upon the
Company's ability to meet on a continuing basis, through actual annual operating
and other results, the various requirements under the Code and described in the
Prospectus with regard to, among other things, the sources of gross income, the
composition of assets, the level of distributions to stockholders, and the
diversity of its stock ownership. Winston & Strawn undertakes no responsibility
to, and will not, review the Company's compliance with these requirements on a
continuing basis. Accordingly, no assurance can be given that the actual
results of the Company's operations, the nature of its assets, the amount and
types of its gross income, the level of its distributions to stockholders and
the diversity of its stock ownership for any given taxable year will satisfy
the requirements under the Code for qualification and taxation as a REIT. In
particular, we would note that, although the Company's Charter contains certain
provisions which restrict the ownership and transfer of the Company's capital
stock and which are intended to prevent concentration of stock ownership, such
provisions do not ensure that the Company will be able to satisfy the
requirement set forth in Code section 856(a)(6) that it not be "closely held"
within the meaning of Code section 856(h) for any given taxable year,
primarily, though not exclusively, as a result of fluctuations in value among
the different classes of the Company's capital stock.
Other than as expressly stated above, we express no opinion on any
issue relating to the Company, the Operating Partnership, the Services Company,
or any of the Property Partnerships or to any investment therein.
This opinion is being delivered to you solely for use in connection
with the Prospectus as of the date hereof. This opinion is solely for the
benefit of the above-named addressee and may not be relied upon by any other
person in any manner whatsoever without our prior written permission.
Notwithstanding the foregoing, we hereby consent to the incorporation by
reference of this opinion to the Registration Statement and to the use of our
name in the Prospectus under the captions "Material Federal Income Tax
Considerations" and "Legal Matters." In giving this consent, we do not admit
that
<PAGE>
Prime Group Realty Trust
June 8, 1999
Page 4
we are included in the category of persons whose consent is required under
section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the SEC.
Very truly yours,
/s/ Winston & Strawn
Winston & Strawn
<PAGE>
Exhibit 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to the Registration Statement (Form S-3 No. 333-70369) and
related Prospectus of Prime Group Realty Trust for the registration of Common
Shares of Beneficial Interest, Preferred Shares of Beneficial Interest,
Depositary Shares Representing Preferred Shares of Beneficial Interest, Share
Purchase Contracts, Debt Securities, Common Share Warrants, Preferred Share
Warrants, Depositary Share Warrants, and Debt Warrants, and to the
incorporation by reference therein of our reports indicated below with
respect to the financial statements indicated below included in Prime Group
Realty Trust's filings as indicated below, filed with the Securities and
Exchange Commission.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
Date of Auditors'
Financial Statements Report Filing
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Consolidated financial statements of Prime Group Realty March 24, 1999 1998 Annual Report on
Trust at December 31, 1998 and 1997 and for the year ended Form 10-K
December 31, 1998 and for the period from November 17,
1997 to December 31, 1997, and the combined financial
statements of the Predecessor Properties for the period from
January 1, 1997 to November 16, 1997 and for the year
ended December 31, 1996.
Statement of revenue and certain expenses of National City February 12, 1999 Current Report on Form
Center for the period from January 1, 1998 to September 30, 8-K dated February 5,
1998 1999
Statement of revenue and certain expenses of 33 West December 24, 1998, Current Report on Form
Monroe for the period from January 1, 1998 to September except for Note 5, 8-K dated January 29,
30, 1998 as to which the 1999
date is January 29,
1999
</TABLE>
Ernst & Young LLP
Chicago, Illinois
June 4, 1999
<PAGE>
Exhibit 25.1
- -------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT
TO SECTION 305(b)(2) ___________
______________________________
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
_________________________________
PRIME GROUP REALTY TRUST
(Exact name of Registrant as specified in its charter)
MARYLAND 36-4173047
(State or other jurisdiction of (I.R.S. employer identification no.)
Incorporation or organization)
77 WEST WACKER DRIVE
SUITE 3900
CHICAGO, IL 60601
(312) 917-1300
(Address, including zip code, and telephone
number of principal executive offices)
SENIOR DEBT SECURITIES
(Title of the indenture securities)
<PAGE>
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee.
(a) Name and address of each examining or supervising authority to
which it is subject.
<TABLE>
<CAPTION>
NAME ADDRESS
<S> <C>
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
</TABLE>
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee, describe each such
affiliation.
None.
ITEM 3.-15. NOT APPLICABLE
ITEM 16. LIST OF EXHIBITS.
EXHIBIT 1 - Restated Organization Certificate of Bankers Trust
Company dated August 7, 1990, Certificate of Amendment
of the Organization Certificate of Bankers Trust
Company dated June 21, 1995 - Incorporated herein by
reference to Exhibit 1 filed with Form T-1 Statement,
Registration No. 33-65171, Certificate of Amendment of
the Organization Certificate of Bankers Trust Company
dated March 20, 1996, incorporate by referenced to
Exhibit 1 filed with Form T-1 Statement, Registration
No. 333-25843 and Certificate of Amendment of the
Organization Certificate of Bankers Trust Company dated
June 19, 1997, copy attached.
EXHIBIT 2 - Certificate of Authority to commence business -
Incorporated herein by reference to Exhibit 2 filed
with Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to exercise corporate
trust powers - Incorporated herein by reference to
Exhibit 2 filed with Form T-1 Statement, Registration
No. 33-21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust Company, as amended
on November 18, 1997. Copy attached.
-2-
<PAGE>
EXHIBIT 5 - Not applicable.
EXHIBIT 6 - Consent of Bankers Trust Company required by Section
321(b) of the Act. - Incorporated herein by reference
to Exhibit 4 filed with Form T-1 Statement,
Registration No. 22-18864.
EXHIBIT 7 - The latest report of condition of Bankers Trust Company
dated as of September 30, 1998. Copy attached.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, a corporation organized and
existing under the laws of the State of New York, has duly caused this
statement of eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in The City of New York, and State of New
York, on this 24th day of March, 1999
BANKERS TRUST COMPANY
/s/ Susan Johnson /s/
---------------------
By: Susan Johnson
Assistant Vice President
-4-
<PAGE>
STATE OF NEW YORK,
BANKING DEPARTMENT
I, MANUEL KURSKY, Deputy Superintendent of Banks of the State of New
York, DO HEREBY APPROVE the annexed Certificate entitled "CERTIFICATE OF
AMENDMENT OF THE ORGANIZATION CERTIFICATE OF BANKERS TRUST COMPANY UNDER
SECTION 8005 OF THE BANKING LAW," dated June 19, 1997, providing for an
increase in authorized capital stock from $1,601,666,670 consisting of
100,166,667 shares with a par value of $10 each designated as Common Stock
and 600 shares with a par value of $1,000,000 each designated as Series
Preferred Stock to $2,001,666,670 consisting of 100,166,667 shares with a par
value of $10 each designated as Common Stock and 1,000 shares with a par
value of $1,000,000 each designated as Series Preferred Stock.
WITNESS, MY HAND AND OFFICIAL SEAL OF THE BANKING DEPARTMENT AT THE CITY OF
NEW YORK,
THIS 27TH DAY OF JUNE IN THE YEAR OF OUR LORD
ONE THOUSAND NINE HUNDRED AND NINETY-SEVEN.
Manuel Kursky
------------------------------
DEPUTY SUPERINTENDENT OF BANKS
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
_____________________________
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a Managing
Director and an Assistant Secretary of Bankers Trust Company, do hereby
certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was filed by the
Superintendent of Banks on the 5th of March, 1903.
3. The organization certificate as heretofore amended is hereby
amended to increase the aggregate number of shares which the corporation
shall have authority to issue and to increase the amount of its authorized
capital stock in conformity therewith.
4. Article III of the organization certificate with reference to the
authorized capital stock, the number of shares into which the capital stock
shall be divided, the par value of the shares and the capital stock
outstanding, which reads as follows:
"III. The amount of capital stock which the corporation is hereafter
to have is One Billion, Six Hundred and One Million, Six Hundred
Sixty-Six Thousand, Six Hundred Seventy Dollars ($1,601,666,670),
divided into One Hundred Million, One Hundred Sixty-Six Thousand, Six
Hundred Sixty-Seven (100,166,667) shares with a par value of $10 each
designated as Common Stock and 600 shares with a par value of One
Million Dollars ($1,000,000) each designated as Series Preferred
Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is hereafter
to have is Two Billion One Million, Six Hundred Sixty-Six Thousand,
Six Hundred Seventy Dollars ($2,001,666,670), divided into One Hundred
Million, One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated as Common
Stock and 1000 shares with a par value of One Million Dollars
($1,000,000) each designated as Series Preferred Stock."
<PAGE>
5. The foregoing amendment of the organization certificate was
authorized by unanimous written consent signed by the holder of all
outstanding shares entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this certificate this
19th day of June, 1997.
James T. Byrne, Jr.
-------------------
James T. Byrne, Jr.
Managing Director
Lea Lahtinen
------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is an
Assistant Secretary of Bankers Trust Company, the corporation described in
the foregoing certificate; that she has read the foregoing certificate and
knows the contents thereof, and that the statements herein contained are true.
Lea Lahtinen
------------
Lea Lahtinen
Sworn to before me this 19th day
of June, 1997.
Sandra L. West
--------------
Notary Public
SANDRA L. WEST
Notary Public State of New York
No. 31-4942101
Qualified in New York County
Commission Expires September 19, 1998
<PAGE>
BY-LAWS
NOVEMBER 18, 1997
BANKERS TRUST COMPANY
NEW YORK
<PAGE>
BY-LAWS
OF
BANKERS TRUST COMPANY
ARTICLE I
MEETINGS OF STOCKHOLDERS
SECTION 1. The annual meeting of the stockholders of this Company shall
be held at the office of the Company in the Borough of Manhattan, City of New
York, on the third Tuesday in January of each year, for the election of
directors and such other business as may properly come before said meeting.
SECTION 2. Special meetings of stockholders other than those regulated by
statute may be called at any time by a majority of the directors. It shall
be the duty of the Chairman of the Board, the Chief Executive Officer or the
President to call such meetings whenever requested in writing to do so by
stockholders owning a majority of the capital stock.
SECTION 3. At all meetings of stockholders, there shall be present,
either in person or by proxy, stockholders owning a majority of the capital
stock of the Company, in order to constitute a quorum, except at special
elections of directors, as provided by law, but less than a quorum shall have
power to adjourn any meeting.
SECTION 4. The Chairman of the Board or, in his absence, the Chief
Executive Officer or, in his absence, the President or, in their absence, the
senior officer present, shall preside at meetings of the stockholders and
shall direct the proceedings and the order of business. The Secretary shall
act as secretary of such meetings and record the proceedings.
ARTICLE II
DIRECTORS
SECTION 1. The affairs of the Company shall be managed and its corporate
powers exercised by a Board of Directors consisting of such number of
directors, but not less than ten nor more than twenty-five, as may from time
to time be fixed by resolution adopted by a majority of the directors then in
office, or by the stockholders. In the event of any increase in the number
of directors, additional directors may be elected within the limitations so
fixed, either by the stockholders or within the limitations imposed by law,
by a majority of directors then in office. One-third of the number of
directors, as fixed from time to time, shall constitute a quorum. Any one or
more members of the Board of Directors or any Committee thereof may
participate in a meeting of the Board of Directors or Committee thereof by
means of a conference telephone or similar communications equipment which
allows all persons participating in the meeting to hear each other at the
same time. Participation by such means shall constitute presence in person
at such a meeting.
<PAGE>
All directors hereafter elected shall hold office until the next annual
meeting of the stockholders and until their successors are elected and have
qualified. No person who shall have attained age 72 shall be eligible to be
elected or re-elected a director. Such director may, however, remain a
director of the Company until the next annual meeting of the stockholders of
Bankers Trust New York Corporation (the Company's parent) so that such
director's retirement will coincide with the retirement date from Bankers
Trust New York Corporation.
No Officer-Director who shall have attained age 65, or earlier relinquishes
his responsibilities and title, shall be eligible to serve as a director.
SECTION 2. Vacancies not exceeding one-third of the whole number of the
Board of Directors may be filled by the affirmative vote of a majority of the
directors then in office, and the directors so elected shall hold office for
the balance of the unexpired term.
SECTION 3. The Chairman of the Board shall preside at meetings of the
Board of Directors. In his absence, the Chief Executive Officer or, in his
absence, such other director as the Board of Directors from time to time may
designate shall preside at such meetings.
SECTION 4. The Board of Directors may adopt such Rules and Regulations
for the conduct of its meetings and the management of the affairs of the
Company as it may deem proper, not inconsistent with the laws of the State of
New York, or these By-Laws, and all officers and employees shall strictly
adhere to, and be bound by, such Rules and Regulations.
SECTION 5. Regular meetings of the Board of Directors shall be held from
time to time on the third Tuesday of the month. If the day appointed for
holding such regular meetings shall be a legal holiday, the regular meeting
to be held on such day shall be held on the next business day thereafter.
Special meetings of the Board of Directors may be called upon at least two
day's notice whenever it may be deemed proper by the Chairman of the Board
or, the Chief Executive Officer or, in their absence, by such other director
as the Board of Directors may have designated pursuant to Section 3 of this
Article, and shall be called upon like notice whenever any three of the
directors so request in writing.
SECTION 6. The compensation of directors as such or as members of
committees shall be fixed from time to time by resolution of the Board of
Directors.
<PAGE>
ARTICLE III
COMMITTEES
SECTION 1. There shall be an Executive Committee of the Board consisting
of not less than five directors who shall be appointed annually by the Board
of Directors. The Chairman of the Board shall preside at meetings of the
Executive Committee. In his absence, the Chief Executive Officer or, in his
absence, such other member of the Committee as the Committee from time to
time may designate shall preside at such meetings.
The Executive Committee shall possess and exercise to the extent permitted by
law all of the powers of the Board of Directors, except when the latter is in
session, and shall keep minutes of its proceedings, which shall be presented
to the Board of Directors at its next subsequent meeting. All acts done and
powers and authority conferred by the Executive Committee from time to time
shall be and be deemed to be, and may be certified as being, the act and
under the authority of the Board of Directors.
A majority of the Committee shall constitute a quorum, but the Committee may
act only by the concurrent vote of not less than one-third of its members, at
least one of whom must be a director other than an officer. Any one or more
directors, even though not members of the Executive Committee, may attend any
meeting of the Committee, and the member or members of the Committee present,
even though less than a quorum, may designate any one or more of such
directors as a substitute or substitutes for any absent member or members of
the Committee, and each such substitute or substitutes shall be counted for
quorum, voting, and all other purposes as a member or members of the
Committee.
SECTION 2. There shall be an Audit Committee appointed annually by
resolution adopted by a majority of the entire Board of Directors which shall
consist of such number of directors, who are not also officers of the
Company, as may from time to time be fixed by resolution adopted by the Board
of Directors. The Chairman shall be designated by the Board of Directors, who
shall also from time to time fix a quorum for meetings of the Committee.
Such Committee shall conduct the annual directors' examinations of the
Company as required by the New York State Banking Law; shall review the
reports of all examinations made of the Company by public authorities and
report thereon to the Board of Directors; and shall report to the Board of
Directors such other matters as it deems advisable with respect to the
Company, its various departments and the conduct of its operations.
In the performance of its duties, the Audit Committee may employ or retain,
from time to time, expert assistants, independent of the officers or
personnel of the Company, to make studies of the Company's assets and
liabilities as the Committee may request and to make an examination of the
accounting and auditing methods of the Company and its system of internal
protective controls to the extent considered necessary or advisable in order
to determine that the operations of the Company, including its fiduciary
departments, are being audited by the General Auditor in such a manner as to
provide prudent and adequate protection. The Committee also may direct the
General Auditor to make such investigation as it deems necessary or advisable
with respect to the Company, its various departments and the conduct of its
operations. The Committee shall hold regular quarterly meetings and during
the intervals thereof shall meet at other times on call of the Chairman.
<PAGE>
SECTION 3. The Board of Directors shall have the power to appoint any
other Committees as may seem necessary, and from time to time to suspend or
continue the powers and duties of such Committees. Each Committee appointed
pursuant to this Article shall serve at the pleasure of the Board of
Directors.
ARTICLE IV
OFFICERS
SECTION 1. The Board of Directors shall elect from among their number a
Chairman of the Board and a Chief Executive Officer; and shall also elect a
President, and may also elect a Senior Vice Chairman, one or more Vice
Chairmen, one or more Executive Vice Presidents, one or more Senior Managing
Directors, one or more Managing Directors, one or more Senior Vice
Presidents, one or more Principals, one or more Vice Presidents, one or more
General Managers, a Secretary, a Controller, a Treasurer, a General Counsel,
one or more Associate General Counsels, a General Auditor, a General Credit
Auditor, and one or more Deputy Auditors, who need not be directors. The
officers of the corporation may also include such other officers or assistant
officers as shall from time to time be elected or appointed by the Board.
The Chairman of the Board or the Chief Executive Officer or, in their
absence, the President, the Senior Vice Chairman or any Vice Chairman, may
from time to time appoint assistant officers. All officers elected or
appointed by the Board of Directors shall hold their respective offices
during the pleasure of the Board of Directors, and all assistant officers
shall hold office at the pleasure of the Board or the Chairman of the Board
or the Chief Executive Officer or, in their absence, the President, the
Senior Vice Chairman or any Vice Chairman. The Board of Directors may
require any and all officers and employees to give security for the faithful
performance of their duties.
SECTION 2. The Board of Directors shall designate the Chief Executive
Officer of the Company who may also hold the additional title of Chairman of
the Board, President, Senior Vice Chairman or Vice Chairman and such person
shall have, subject to the supervision and direction of the Board of
Directors or the Executive Committee, all of the powers vested in such Chief
Executive Officer by law or by these By-Laws, or which usually attach or
pertain to such office. The other officers shall have, subject to the
supervision and direction of the Board of Directors or the Executive
Committee or the Chairman of the Board or, the Chief Executive Officer, the
powers vested by law or by these By-Laws in them as holders of their
respective offices and, in addition, shall perform such other duties as shall
be assigned to them by the Board of Directors or the Executive Committee or
the Chairman of the Board or the Chief Executive Officer.
The General Auditor shall be responsible, through the Audit Committee, to the
Board of Directors for the determination of the program of the internal audit
function and the evaluation of the adequacy of the system of internal
controls. Subject to the Board of Directors, the General Auditor shall have
and may exercise all the powers and shall perform all the duties usual to
such office and shall have such other powers as may be prescribed or assigned
to him from time to time by the Board of Directors or vested in him by law or
by these By-Laws. He shall perform such other duties and shall make such
investigations, examinations and reports as may be prescribed or required by
the Audit Committee. The General Auditor shall have unrestricted access to
all records and premises of the Company and shall delegate such authority to
his subordinates. He shall have the duty to report to the Audit Committee on
all matters concerning the internal audit
<PAGE>
program and the adequacy of the system of internal controls of the Company
which he deems advisable or which the Audit Committee may request.
Additionally, the General Auditor shall have the duty of reporting
independently of all officers of the Company to the Audit Committee at least
quarterly on any matters concerning the internal audit program and the
adequacy of the system of internal controls of the Company that should be
brought to the attention of the directors except those matters responsibility
for which has been vested in the General Credit Auditor. Should the General
Auditor deem any matter to be of special immediate importance, he shall
report thereon forthwith to the Audit Committee. The General Auditor shall
report to the Chief Financial Officer only for administrative purposes.
The General Credit Auditor shall be responsible to the Chief Executive
Officer and, through the Audit Committee, to the Board of Directors for the
systems of internal credit audit, shall perform such other duties as the
Chief Executive Officer may prescribe, and shall make such examinations and
reports as may be required by the Audit Committee. The General Credit
Auditor shall have unrestricted access to all records and may delegate such
authority to subordinates.
SECTION 3. The compensation of all officers shall be fixed under such
plan or plans of position evaluation and salary administration as shall be
approved from time to time by resolution of the Board of Directors.
SECTION 4. The Board of Directors, the Executive Committee, the Chairman
of the Board, the Chief Executive Officer or any person authorized for this
purpose by the Chief Executive Officer, shall appoint or engage all other
employees and agents and fix their compensation. The employment of all such
employees and agents shall continue during the pleasure of the Board of
Directors or the Executive Committee or the Chairman of the Board or the
Chief Executive Officer or any such authorized person; and the Board of
Directors, the Executive Committee, the Chairman of the Board, the Chief
Executive Officer or any such authorized person may discharge any such
employees and agents at will.
<PAGE>
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
SECTION 1. The Company shall, to the fullest extent permitted by Section
7018 of the New York Banking Law, indemnify any person who is or was made, or
threatened to be made, a party to an action or proceeding, whether civil or
criminal, whether involving any actual or alleged breach of duty, neglect or
error, any accountability, or any actual or alleged misstatement, misleading
statement or other act or omission and whether brought or threatened in any
court or administrative or legislative body or agency, including an action by
or in the right of the Company to procure a judgment in its favor and an
action by or in the right of any other corporation of any type or kind,
domestic or foreign, or any partnership, joint venture, trust, employee
benefit plan or other enterprise, which any director or officer of the
Company is servicing or served in any capacity at the request of the Company
by reason of the fact that he, his testator or intestate, is or was a
director or officer of the Company, or is serving or served such other
corporation, partnership, joint venture, trust, employee benefit plan or
other enterprise in any capacity, against judgments, fines, amounts paid in
settlement, and costs, charges and expenses, including attorneys' fees, or
any appeal therein; provided, however, that no indemnification shall be
provided to any such person if a judgment or other final adjudication adverse
to the director or officer establishes that (i) his acts were committed in
bad faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or (ii) he
personally gained in fact a financial profit or other advantage to which he
was not legally entitled.
SECTION 2. The Company may indemnify any other person to whom the Company
is permitted to provide indemnification or the advancement of expenses by
applicable law, whether pursuant to rights granted pursuant to, or provided
by, the New York Banking Law or other rights created by (i) a resolution of
stockholders, (ii) a resolution of directors, or (iii) an agreement providing
for such indemnification, it being expressly intended that these By-Laws
authorize the creation of other rights in any such manner.
SECTION 3. The Company shall, from time to time, reimburse or advance to
any person referred to in Section 1 the funds necessary for payment of
expenses, including attorneys' fees, incurred in connection with any action
or proceeding referred to in Section 1, upon receipt of a written undertaking
by or on behalf of such person to repay such amount(s) if a judgment or other
final adjudication adverse to the director or officer establishes that (i)
his acts were committed in bad faith or were the result of active and
deliberate dishonesty and, in either case, were material to the cause of
action so adjudicated, or (ii) he personally gained in fact a financial
profit or other advantage to which he was not legally entitled.
SECTION 4. Any director or officer of the Company serving (i) another
corporation, of which a majority of the shares entitled to vote in the
election of its directors is held by the Company, or (ii) any employee
benefit plan of the Company or any corporation referred to in clause (i) in
any capacity shall be deemed to be doing so at the request of the Company.
In all other cases, the provisions of this Article V will apply (i) only if
the person serving another corporation or any partnership, joint venture,
trust, employee benefit plan or other enterprise so served at the specific
request of the Company, evidenced by a written communication signed by the
Chairman of the Board, the Chief Executive Officer or the
<PAGE>
President, and (ii) only if and to the extent that, after making such efforts
as the Chairman of the Board, the Chief Executive Officer or the President
shall deem adequate in the circumstances, such person shall be unable to
obtain indemnification from such other enterprise or its insurer.
SECTION 5. Any person entitled to be indemnified or to the reimbursement
or advancement of expenses as a matter of right pursuant to this Article V
may elect to have the right to indemnification (or advancement of expenses)
interpreted on the basis of the applicable law in effect at the time of
occurrence of the event or events giving rise to the action or proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect
at the time indemnification is sought.
SECTION 6. The right to be indemnified or to the reimbursement or
advancement of expense pursuant to this Article V (i) is a contract right
pursuant to which the person entitled thereto may bring suit as if the
provisions hereof were set forth in a separate written contract between the
Company and the director or officer, (ii) is intended to be retroactive and
shall be available with respect to events occurring prior to the adoption
hereof, and (iii) shall continue to exist after the rescission or restrictive
modification hereof with respect to events occurring prior thereto.
SECTION 7. If a request to be indemnified or for the reimbursement or
advancement of expenses pursuant hereto is not paid in full by the Company
within thirty days after a written claim has been received by the Company,
the claimant may at any time thereafter bring suit against the Company to
recover the unpaid amount of the claim and, if successful in whole or in
part, the claimant shall be entitled also to be paid the expenses of
prosecuting such claim. Neither the failure of the Company (including its
Board of Directors, independent legal counsel, or its stockholders) to have
made a determination prior to the commencement of such action that
indemnification of or reimbursement or advancement of expenses to the
claimant is proper in the circumstance, nor an actual determination by the
Company (including its Board of Directors, independent legal counsel, or its
stockholders) that the claimant is not entitled to indemnification or to the
reimbursement or advancement of expenses, shall be a defense to the action or
create a presumption that the claimant is not so entitled.
SECTION 8. A person who has been successful, on the merits or otherwise,
in the defense of a civil or criminal action or proceeding of the character
described in Section 1 shall be entitled to indemnification only as provided
in Sections 1 and 3, notwithstanding any provision of the New York Banking
Law to the contrary.
<PAGE>
ARTICLE VI
SEAL
SECTION 1. The Board of Directors shall provide a seal for the Company,
the counterpart dies of which shall be in the charge of the Secretary of the
Company and such officers as the Chairman of the Board, the Chief Executive
Officer or the Secretary may from time to time direct in writing, to be
affixed to certificates of stock and other documents in accordance with the
directions of the Board of Directors or the Executive Committee.
SECTION 2. The Board of Directors may provide, in proper cases on a
specified occasion and for a specified transaction or transactions, for the
use of a printed or engraved facsimile seal of the Company.
ARTICLE VII
CAPITAL STOCK
SECTION 1. Registration of transfer of shares shall only be made upon the
books of the Company by the registered holder in person, or by power of
attorney, duly executed, witnessed and filed with the Secretary or other
proper officer of the Company, on the surrender of the certificate or
certificates of such shares properly assigned for transfer.
ARTICLE VIII
CONSTRUCTION
SECTION 1. The masculine gender, when appearing in these By-Laws, shall
be deemed to include the feminine gender.
ARTICLE IX
AMENDMENTS
SECTION 1. These By-Laws may be altered, amended or added to by the Board
of Directors at any meeting, or by the stockholders at any annual or special
meeting, provided notice thereof has been given.
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Legal Title of Bank: Bankers Trust Company Call Date: 09/30/98 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR SEPTEMBER 30, 1998
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, reported the amount outstanding as of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
---------------
| C400 |
Dollar Amounts in Thousands | RCFD Bil Mil Thou |
<S> <C> <C>
ASSETS | / / / / / / / / / / / / / / / |
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / / / / / |
a. Noninterest-bearing balances and currency and coin (1) ................. | 0081 2,291,000 |1.a.
b. Interest-bearing balances (2) ......................................... | 0071 2,636,000 |1.b.
2. Securities: | / / / / / / / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) ............ | 1754 0 |2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)........... | 1773 6,617,000 |2.b.
3. Federal funds sold and securities purchased under agreements to resell.... | 1350 32,734,000 |3.
4. Loans and lease financing receivables: | / / / / / / / / / / / / / / / |
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 20,227,000 | / / / / / / / / / / / / / / / |4.a.
b. LESS: Allowance for loan and lease losses.....................RCFD 3123 619,000 | / / / / / / / / / / / / / / / |4.b.
c. LESS: Allocated transfer risk reserve.........................RCFD 3128 0 | / / / / / / / / / / / / / / / |4.c.
d. Loans and leases, net of unearned income, | / / / / / / / / / / / / / / / |
allowance, and reserve (item 4.a minus 4.b and 4.c).................... | 2125 19,608,000 |4.d.
5. Trading Assets (from schedule RC-D)....................................... | 3545 49,545,000 |5.
6. Premises and fixed assets (including capitalized leases).................. | 2145 885,000 |6.
7. Other real estate owned (from Schedule RC-M).............................. | 2150 115,000 |7.
8. Investments in unconsolidated subsidiaries and associated companies
(from Schedule RC-M) | 2130 391,000 |8.
9. Customers' liability to this bank on acceptances outstanding.............. | 2155 392,000 |9.
10. Intangible assets (from Schedule RC-M).................................... | 2143 266,000 |10.
11. Other assets (from Schedule RC-F)......................................... | 2160 5,884,000 |11.
12. Total assets (sum of items 1 through 11).................................. | 2170 121,364,000 |12.
</TABLE>
- --------------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Legal Title of Bank: Bankers Trust Company Call Date: 09/30/98 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State Zip: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
</TABLE>
SCHEDULE RC--CONTINUED
<TABLE>
<CAPTION>
Dollar Amounts in Thousands | / / / / / Bil Mil Thou__|
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
LIABILITIES | / / / / / / / / / / / / / / |
13. Deposits: | / / / / / / / / / / / / / / |
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I) | RCON 2200 22,231,000 |13.a.
(1) Noninterest-bearing(1).............................RCON 6631 3,040,000..... | / / / / / / / / / / / / / / |13.a.(1)
(2) Interest-bearing...................................RCON 6636 19,191,000..... | / / / / / / / / / / / / / / |13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E | / / / / / / / / / / / / / / |
part II) | RCFN 2200 21,932,000 |13.b.
(1) Noninterest-bearing ...............................RCFN 6631 2,423,000 | / / / / / / / / / / / / / / |13.b.(1)
(2) Interest-bearing ..................................RCFN 6636 19,509,000 | / / / / / / / / / / / / / / |13.b.(2)
14. Federal funds purchased and securities sold under agreements to repurchase | RCFD 2800 14,360,000 |14.
15. a. Demand notes issued to the U.S. Treasury............................... | RCON 2840 0 |15.a.
b. Trading liabilities (from Schedule RC-D)............................... | RCFD 3548 32,890,000 |15.b.
16. Other borrowed money (includes mortgage indebtedness and obligations under
capitalized leases): | / / / / / / / / / / / / / / |
a. With a remaining maturity of one year or less ......................... | RCFD 2332 7,653,000 |16.a.
b. With a remaining maturity of more than one year through three years... | A547 3,707,000 |16.b.
c. With a remaining maturity of more than three years..................... | A548 3,034,000 |16.c
17. Not Applicable. | / / / / / / / / / / / / / / |17.
18. Bank's liability on acceptances executed and outstanding.................. | RCFD 2920 392,000 |18.
19. Subordinated notes and debentures (2)..................................... | RCFD 3200 1,533,000 |19.
20. Other liabilities (from Schedule RC-G) ................................... | RCFD 2930 6,595,000 |20.
21. Total liabilities (sum of items 13 through 20)............................ | RCFD 2948 114,327,000 |21.
22. Not Applicable | / / / / / / / / / / / / / / |
| / / / / / / / / / / / / / / |22.
EQUITY CAPITAL | / / / / / / / / / / / / / / |
23. Perpetual preferred stock and related surplus ............................. | RCFD 3838 1,500,000 |23.
24. Common stock.............................................................. | RCFD 3230 2,002,000 |24.
25. Surplus (exclude all surplus related to preferred stock) ................. | RCFD 3839 540,000 |25.
26. a. Undivided profits and capital reserves................................. | RCFD 3632 3,421,000 |26.a.
b. Net unrealized holding gains (losses) on available-for-sale securities. | RCFD 8434 ( 46,000) |26.b.
27. Cumulative foreign currency translation adjustments....................... | RCFD 3284 ( 380,000) |27.
28. Total equity capital (sum of items 23 through 27)......................... | RCFD 3210 7,037,000 |28.
29. Total liabilities and equity capital (sum of items 21 and 28)............. | RCFD 3300 121,364,000 |29
| ----------- |
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the
most comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1997...............................................| RCFD 6724 1 | M.1
-------------------------------------
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required
by state chartering authority)
</TABLE>
- ----------------------
(1) Including total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
<PAGE>
Exhibit 25.2
- -------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT
TO SECTION 305(b)(2) ___________
______________________________
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
_________________________________
PRIME GROUP REALTY TRUST
(Exact name of Registrant as specified in its charter)
MARYLAND 36-4173047
(State or other jurisdiction of (I.R.S. employer identification no.)
Incorporation or organization)
77 WEST WACKER DRIVE
SUITE 3900
CHICAGO, IL 60601
(312) 917-1300
(Address, including zip code, and telephone
number of principal executive offices)
SUBORDINATED DEBT SECURITIES
(Title of the indenture securities)
<PAGE>
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee.
(a) Name and address of each examining or supervising authority to
which it is subject.
<TABLE>
<CAPTION>
<S> <C>
NAME ADDRESS
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
</TABLE>
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee, describe each such
affiliation.
None.
ITEM 3. -15. NOT APPLICABLE
ITEM 16. LIST OF EXHIBITS.
EXHIBIT 1 - Restated Organization Certificate of Bankers Trust
Company dated August 7, 1990, Certificate of Amendment
of the Organization Certificate of Bankers Trust
Company dated June 21, 1995 - Incorporated herein by
reference to Exhibit 1 filed with Form T-1 Statement,
Registration No. 33-65171, Certificate of Amendment of
the Organization Certificate of Bankers Trust Company
dated March 20, 1996, incorporate by referenced to
Exhibit 1 filed with Form T-1 Statement, Registration
No. 333-25843 and Certificate of Amendment of the
Organization Certificate of Bankers Trust Company dated
June 19, 1997, copy attached.
EXHIBIT 2 - Certificate of Authority to commence business -
Incorporated herein by reference to Exhibit 2 filed
with Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to exercise corporate
trust powers - Incorporated herein by reference to
Exhibit 2 filed with Form T-1 Statement, Registration
No. 33-21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust Company, as amended
on November 18, 1997. Copy attached.
-2-
<PAGE>
EXHIBIT 5 - Not applicable.
EXHIBIT 6 - Consent of Bankers Trust Company required by Section
321(b) of the Act. - Incorporated herein by reference
to Exhibit 4 filed with Form T-1 Statement,
Registration No. 22-18864.
EXHIBIT 7 - The latest report of condition of Bankers Trust Company
dated as of September 30, 1998. Copy attached.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, a corporation organized and
existing under the laws of the State of New York, has duly caused this
statement of eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in The City of New York, and State of New
York, on this 24th day of March, 1999
BANKERS TRUST COMPANY
/s/ Susan Johnson /s/
---------------------
By: Susan Johnson
Assistant Vice President
-4-
<PAGE>
STATE OF NEW YORK,
BANKING DEPARTMENT
I, MANUEL KURSKY, Deputy Superintendent of Banks of the State of New
York, DO HEREBY APPROVE the annexed Certificate entitled "CERTIFICATE OF
AMENDMENT OF THE ORGANIZATION CERTIFICATE OF BANKERS TRUST COMPANY UNDER
SECTION 8005 OF THE BANKING LAW," dated June 19, 1997, providing for an
increase in authorized capital stock from $1,601,666,670 consisting of
100,166,667 shares with a par value of $10 each designated as Common Stock
and 600 shares with a par value of $1,000,000 each designated as Series
Preferred Stock to $2,001,666,670 consisting of 100,166,667 shares with a par
value of $10 each designated as Common Stock and 1,000 shares with a par
value of $1,000,000 each designated as Series Preferred Stock.
WITNESS, MY HAND AND OFFICIAL SEAL OF THE BANKING DEPARTMENT AT THE CITY OF
NEW YORK,
THIS 27TH DAY OF JUNE IN THE YEAR OF OUR LORD
ONE THOUSAND NINE HUNDRED AND NINETY-SEVEN.
Manuel Kursky
------------------------------
DEPUTY SUPERINTENDENT OF BANKS
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
_____________________________
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a Managing
Director and an Assistant Secretary of Bankers Trust Company, do hereby
certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was filed by the
Superintendent of Banks on the 5th of march, 1903.
3. The organization certificate as heretofore amended is hereby
amended to increase the aggregate number of shares which the corporation
shall have authority to issue and to increase the amount of its authorized
capital stock in conformity therewith.
4. Article III of the organization certificate with reference to the
authorized capital stock, the number of shares into which the capital stock
shall be divided, the par value of the shares and the capital stock
outstanding, which reads as follows:
"III. The amount of capital stock which the corporation is hereafter
to have is One Billion, Six Hundred and One Million, Six Hundred
Sixty-Six Thousand, Six Hundred Seventy Dollars ($1,601,666,670),
divided into One Hundred Million, One Hundred Sixty-Six Thousand, Six
Hundred Sixty-Seven (100,166,667) shares with a par value of $10 each
designated as Common Stock and 600 shares with a par value of One
Million Dollars ($1,000,000) each designated as Series Preferred
Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is hereafter
to have is Two Billion One Million, Six Hundred Sixty-Six Thousand,
Six Hundred Seventy Dollars ($2,001,666,670), divided into One Hundred
Million, One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated as Common
Stock and 1000 shares with a par value of One Million Dollars
($1,000,000) each designated as Series Preferred Stock."
<PAGE>
5. The foregoing amendment of the organization certificate was
authorized by unanimous written consent signed by the holder of all
outstanding shares entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this certificate this
19th day of June, 1997.
James T. Byrne, Jr.
-------------------
James T. Byrne, Jr.
Managing Director
Lea Lahtinen
------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is an
Assistant Secretary of Bankers Trust Company, the corporation described in
the foregoing certificate; that she has read the foregoing certificate and
knows the contents thereof, and that the statements herein contained are true.
Lea Lahtinen
------------
Lea Lahtinen
Sworn to before me this 19th day
of June, 1997.
Sandra L. West
- --------------------
Notary Public
SANDRA L. WEST
Notary Public State of New York
No. 31-4942101
Qualified in New York County
Commission Expires September 19, 1998
<PAGE>
BY-LAWS
NOVEMBER 18, 1997
BANKERS TRUST COMPANY
NEW YORK
<PAGE>
BY-LAWS
OF
BANKERS TRUST COMPANY
ARTICLE I
MEETINGS OF STOCKHOLDERS
SECTION 1. The annual meeting of the stockholders of this Company shall
be held at the office of the Company in the Borough of Manhattan, City of New
York, on the third Tuesday in January of each year, for the election of
directors and such other business as may properly come before said meeting.
SECTION 2. Special meetings of stockholders other than those regulated by
statute may be called at any time by a majority of the directors. It shall
be the duty of the Chairman of the Board, the Chief Executive Officer or the
President to call such meetings whenever requested in writing to do so by
stockholders owning a majority of the capital stock.
SECTION 3. At all meetings of stockholders, there shall be present,
either in person or by proxy, stockholders owning a majority of the capital
stock of the Company, in order to constitute a quorum, except at special
elections of directors, as provided by law, but less than a quorum shall have
power to adjourn any meeting.
SECTION 4. The Chairman of the Board or, in his absence, the Chief
Executive Officer or, in his absence, the President or, in their absence, the
senior officer present, shall preside at meetings of the stockholders and
shall direct the proceedings and the order of business. The Secretary shall
act as secretary of such meetings and record the proceedings.
ARTICLE II
DIRECTORS
SECTION 1. The affairs of the Company shall be managed and its corporate
powers exercised by a Board of Directors consisting of such number of
directors, but not less than ten nor more than twenty-five, as may from time
to time be fixed by resolution adopted by a majority of the directors then in
office, or by the stockholders. In the event of any increase in the number
of directors, additional directors may be elected within the limitations so
fixed, either by the stockholders or within the limitations imposed by law,
by a majority of directors then in office. One-third of the number of
directors, as fixed from time to time, shall constitute a quorum. Any one or
more members of the Board of Directors or any Committee thereof may
participate in a meeting of the Board of Directors or Committee thereof by
means of a conference telephone or similar communications equipment which
allows all persons participating in the meeting to hear each other at the
same time. Participation by such means shall constitute presence in person
at such a meeting.
<PAGE>
All directors hereafter elected shall hold office until the next annual
meeting of the stockholders and until their successors are elected and have
qualified. No person who shall have attained age 72 shall be eligible to be
elected or re-elected a director. Such director may, however, remain a
director of the Company until the next annual meeting of the stockholders of
Bankers Trust New York Corporation (the Company's parent) so that such
director's retirement will coincide with the retirement date from Bankers
Trust New York Corporation.
No Officer-Director who shall have attained age 65, or earlier relinquishes
his responsibilities and title, shall be eligible to serve as a director.
SECTION 2. Vacancies not exceeding one-third of the whole number of the
Board of Directors may be filled by the affirmative vote of a majority of the
directors then in office, and the directors so elected shall hold office for
the balance of the unexpired term.
SECTION 3. The Chairman of the Board shall preside at meetings of the
Board of Directors. In his absence, the Chief Executive Officer or, in his
absence, such other director as the Board of Directors from time to time may
designate shall preside at such meetings.
SECTION 4. The Board of Directors may adopt such Rules and Regulations
for the conduct of its meetings and the management of the affairs of the
Company as it may deem proper, not inconsistent with the laws of the State of
New York, or these By-Laws, and all officers and employees shall strictly
adhere to, and be bound by, such Rules and Regulations.
SECTION 5. Regular meetings of the Board of Directors shall be held from
time to time on the third Tuesday of the month. If the day appointed for
holding such regular meetings shall be a legal holiday, the regular meeting
to be held on such day shall be held on the next business day thereafter.
Special meetings of the Board of Directors may be called upon at least two
day's notice whenever it may be deemed proper by the Chairman of the Board
or, the Chief Executive Officer or, in their absence, by such other director
as the Board of Directors may have designated pursuant to Section 3 of this
Article, and shall be called upon like notice whenever any three of the
directors so request in writing.
SECTION 6. The compensation of directors as such or as members of
committees shall be fixed from time to time by resolution of the Board of
Directors.
<PAGE>
ARTICLE III
COMMITTEES
SECTION 1. There shall be an Executive Committee of the Board consisting
of not less than five directors who shall be appointed annually by the Board
of Directors. The Chairman of the Board shall preside at meetings of the
Executive Committee. In his absence, the Chief Executive Officer or, in his
absence, such other member of the Committee as the Committee from time to
time may designate shall preside at such meetings.
The Executive Committee shall possess and exercise to the extent permitted by
law all of the powers of the Board of Directors, except when the latter is in
session, and shall keep minutes of its proceedings, which shall be presented
to the Board of Directors at its next subsequent meeting. All acts done and
powers and authority conferred by the Executive Committee from time to time
shall be and be deemed to be, and may be certified as being, the act and
under the authority of the Board of Directors.
A majority of the Committee shall constitute a quorum, but the Committee may
act only by the concurrent vote of not less than one-third of its members, at
least one of whom must be a director other than an officer. Any one or more
directors, even though not members of the Executive Committee, may attend any
meeting of the Committee, and the member or members of the Committee present,
even though less than a quorum, may designate any one or more of such
directors as a substitute or substitutes for any absent member or members of
the Committee, and each such substitute or substitutes shall be counted for
quorum, voting, and all other purposes as a member or members of the
Committee.
SECTION 2. There shall be an Audit Committee appointed annually by
resolution adopted by a majority of the entire Board of Directors which shall
consist of such number of directors, who are not also officers of the
Company, as may from time to time be fixed by resolution adopted by the Board
of Directors. The Chairman shall be designated by the Board of Directors, who
shall also from time to time fix a quorum for meetings of the Committee.
Such Committee shall conduct the annual directors' examinations of the
Company as required by the New York State Banking Law; shall review the
reports of all examinations made of the Company by public authorities and
report thereon to the Board of Directors; and shall report to the Board of
Directors such other matters as it deems advisable with respect to the
Company, its various departments and the conduct of its operations.
In the performance of its duties, the Audit Committee may employ or retain,
from time to time, expert assistants, independent of the officers or
personnel of the Company, to make studies of the Company's assets and
liabilities as the Committee may request and to make an examination of the
accounting and auditing methods of the Company and its system of internal
protective controls to the extent considered necessary or advisable in order
to determine that the operations of the Company, including its fiduciary
departments, are being audited by the General Auditor in such a manner as to
provide prudent and adequate protection. The Committee also may direct the
General Auditor to make such investigation as it deems necessary or advisable
with respect to the Company, its various departments and the conduct of its
operations. The Committee shall hold regular quarterly meetings and during
the intervals thereof shall meet at other times on call of the Chairman.
<PAGE>
SECTION 3. The Board of Directors shall have the power to appoint any
other Committees as may seem necessary, and from time to time to suspend or
continue the powers and duties of such Committees. Each Committee appointed
pursuant to this Article shall serve at the pleasure of the Board of
Directors.
ARTICLE IV
OFFICERS
SECTION 1. The Board of Directors shall elect from among their number a
Chairman of the Board and a Chief Executive Officer; and shall also elect a
President, and may also elect a Senior Vice Chairman, one or more Vice
Chairmen, one or more Executive Vice Presidents, one or more Senior Managing
Directors, one or more Managing Directors, one or more Senior Vice
Presidents, one or more Principals, one or more Vice Presidents, one or more
General Managers, a Secretary, a Controller, a Treasurer, a General Counsel,
one or more Associate General Counsels, a General Auditor, a General Credit
Auditor, and one or more Deputy Auditors, who need not be directors. The
officers of the corporation may also include such other officers or assistant
officers as shall from time to time be elected or appointed by the Board.
The Chairman of the Board or the Chief Executive Officer or, in their
absence, the President, the Senior Vice Chairman or any Vice Chairman, may
from time to time appoint assistant officers. All officers elected or
appointed by the Board of Directors shall hold their respective offices
during the pleasure of the Board of Directors, and all assistant officers
shall hold office at the pleasure of the Board or the Chairman of the Board
or the Chief Executive Officer or, in their absence, the President, the
Senior Vice Chairman or any Vice Chairman. The Board of Directors may
require any and all officers and employees to give security for the faithful
performance of their duties.
SECTION 2. The Board of Directors shall designate the Chief Executive
Officer of the Company who may also hold the additional title of Chairman of
the Board, President, Senior Vice Chairman or Vice Chairman and such person
shall have, subject to the supervision and direction of the Board of
Directors or the Executive Committee, all of the powers vested in such Chief
Executive Officer by law or by these By-Laws, or which usually attach or
pertain to such office. The other officers shall have, subject to the
supervision and direction of the Board of Directors or the Executive
Committee or the Chairman of the Board or, the Chief Executive Officer, the
powers vested by law or by these By-Laws in them as holders of their
respective offices and, in addition, shall perform such other duties as shall
be assigned to them by the Board of Directors or the Executive Committee or
the Chairman of the Board or the Chief Executive Officer.
The General Auditor shall be responsible, through the Audit Committee, to the
Board of Directors for the determination of the program of the internal audit
function and the evaluation of the adequacy of the system of internal
controls. Subject to the Board of Directors, the General Auditor shall have
and may exercise all the powers and shall perform all the duties usual to
such office and shall have such other powers as may be prescribed or assigned
to him from time to time by the Board of Directors or vested in him by law or
by these By-Laws. He shall perform such other duties and shall make such
investigations, examinations and reports as may be prescribed or required by
the Audit Committee. The General Auditor shall have unrestricted access to
all records and premises of the Company and shall delegate such authority to
his subordinates. He shall have the duty to report to the Audit Committee on
all matters concerning the internal audit
<PAGE>
program and the adequacy of the system of internal controls of the Company
which he deems advisable or which the Audit Committee may request.
Additionally, the General Auditor shall have the duty of reporting
independently of all officers of the Company to the Audit Committee at least
quarterly on any matters concerning the internal audit program and the
adequacy of the system of internal controls of the Company that should be
brought to the attention of the directors except those matters responsibility
for which has been vested in the General Credit Auditor. Should the General
Auditor deem any matter to be of special immediate importance, he shall
report thereon forthwith to the Audit Committee. The General Auditor shall
report to the Chief Financial Officer only for administrative purposes.
The General Credit Auditor shall be responsible to the Chief Executive
Officer and, through the Audit Committee, to the Board of Directors for the
systems of internal credit audit, shall perform such other duties as the
Chief Executive Officer may prescribe, and shall make such examinations and
reports as may be required by the Audit Committee. The General Credit
Auditor shall have unrestricted access to all records and may delegate such
authority to subordinates.
SECTION 3. The compensation of all officers shall be fixed under such
plan or plans of position evaluation and salary administration as shall be
approved from time to time by resolution of the Board of Directors.
SECTION 4. The Board of Directors, the Executive Committee, the Chairman
of the Board, the Chief Executive Officer or any person authorized for this
purpose by the Chief Executive Officer, shall appoint or engage all other
employees and agents and fix their compensation. The employment of all such
employees and agents shall continue during the pleasure of the Board of
Directors or the Executive Committee or the Chairman of the Board or the
Chief Executive Officer or any such authorized person; and the Board of
Directors, the Executive Committee, the Chairman of the Board, the Chief
Executive Officer or any such authorized person may discharge any such
employees and agents at will.
<PAGE>
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
SECTION 1. The Company shall, to the fullest extent permitted by Section
7018 of the New York Banking Law, indemnify any person who is or was made, or
threatened to be made, a party to an action or proceeding, whether civil or
criminal, whether involving any actual or alleged breach of duty, neglect or
error, any accountability, or any actual or alleged misstatement, misleading
statement or other act or omission and whether brought or threatened in any
court or administrative or legislative body or agency, including an action by
or in the right of the Company to procure a judgment in its favor and an
action by or in the right of any other corporation of any type or kind,
domestic or foreign, or any partnership, joint venture, trust, employee
benefit plan or other enterprise, which any director or officer of the
Company is servicing or served in any capacity at the request of the Company
by reason of the fact that he, his testator or intestate, is or was a
director or officer of the Company, or is serving or served such other
corporation, partnership, joint venture, trust, employee benefit plan or
other enterprise in any capacity, against judgments, fines, amounts paid in
settlement, and costs, charges and expenses, including attorneys' fees, or
any appeal therein; provided, however, that no indemnification shall be
provided to any such person if a judgment or other final adjudication adverse
to the director or officer establishes that (i) his acts were committed in
bad faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or (ii) he
personally gained in fact a financial profit or other advantage to which he
was not legally entitled.
SECTION 2. The Company may indemnify any other person to whom the Company
is permitted to provide indemnification or the advancement of expenses by
applicable law, whether pursuant to rights granted pursuant to, or provided
by, the New York Banking Law or other rights created by (i) a resolution of
stockholders, (ii) a resolution of directors, or (iii) an agreement providing
for such indemnification, it being expressly intended that these By-Laws
authorize the creation of other rights in any such manner.
SECTION 3. The Company shall, from time to time, reimburse or advance to
any person referred to in Section 1 the funds necessary for payment of
expenses, including attorneys' fees, incurred in connection with any action
or proceeding referred to in Section 1, upon receipt of a written undertaking
by or on behalf of such person to repay such amount(s) if a judgment or other
final adjudication adverse to the director or officer establishes that (i)
his acts were committed in bad faith or were the result of active and
deliberate dishonesty and, in either case, were material to the cause of
action so adjudicated, or (ii) he personally gained in fact a financial
profit or other advantage to which he was not legally entitled.
SECTION 4. Any director or officer of the Company serving (i) another
corporation, of which a majority of the shares entitled to vote in the
election of its directors is held by the Company, or (ii) any employee
benefit plan of the Company or any corporation referred to in clause (i) in
any capacity shall be deemed to be doing so at the request of the Company.
In all other cases, the provisions of this Article V will apply (i) only if
the person serving another corporation or any partnership, joint venture,
trust, employee benefit plan or other enterprise so served at the specific
request of the Company, evidenced by a written communication signed by the
Chairman of the Board, the Chief Executive Officer or the
<PAGE>
President, and (ii) only if and to the extent that, after making such efforts
as the Chairman of the Board, the Chief Executive Officer or the President
shall deem adequate in the circumstances, such person shall be unable to
obtain indemnification from such other enterprise or its insurer.
SECTION 5. Any person entitled to be indemnified or to the reimbursement
or advancement of expenses as a matter of right pursuant to this Article V
may elect to have the right to indemnification (or advancement of expenses)
interpreted on the basis of the applicable law in effect at the time of
occurrence of the event or events giving rise to the action or proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect
at the time indemnification is sought.
SECTION 6. The right to be indemnified or to the reimbursement or
advancement of expense pursuant to this Article V (i) is a contract right
pursuant to which the person entitled thereto may bring suit as if the
provisions hereof were set forth in a separate written contract between the
Company and the director or officer, (ii) is intended to be retroactive and
shall be available with respect to events occurring prior to the adoption
hereof, and (iii) shall continue to exist after the rescission or restrictive
modification hereof with respect to events occurring prior thereto.
SECTION 7. If a request to be indemnified or for the reimbursement or
advancement of expenses pursuant hereto is not paid in full by the Company
within thirty days after a written claim has been received by the Company,
the claimant may at any time thereafter bring suit against the Company to
recover the unpaid amount of the claim and, if successful in whole or in
part, the claimant shall be entitled also to be paid the expenses of
prosecuting such claim. Neither the failure of the Company (including its
Board of Directors, independent legal counsel, or its stockholders) to have
made a determination prior to the commencement of such action that
indemnification of or reimbursement or advancement of expenses to the
claimant is proper in the circumstance, nor an actual determination by the
Company (including its Board of Directors, independent legal counsel, or its
stockholders) that the claimant is not entitled to indemnification or to the
reimbursement or advancement of expenses, shall be a defense to the action or
create a presumption that the claimant is not so entitled.
SECTION 8. A person who has been successful, on the merits or otherwise,
in the defense of a civil or criminal action or proceeding of the character
described in Section 1 shall be entitled to indemnification only as provided
in Sections 1 and 3, notwithstanding any provision of the New York Banking
Law to the contrary.
<PAGE>
ARTICLE VI
SEAL
SECTION 1. The Board of Directors shall provide a seal for the Company,
the counterpart dies of which shall be in the charge of the Secretary of the
Company and such officers as the Chairman of the Board, the Chief Executive
Officer or the Secretary may from time to time direct in writing, to be
affixed to certificates of stock and other documents in accordance with the
directions of the Board of Directors or the Executive Committee.
SECTION 2. The Board of Directors may provide, in proper cases on a
specified occasion and for a specified transaction or transactions, for the
use of a printed or engraved facsimile seal of the Company.
ARTICLE VII
CAPITAL STOCK
SECTION 1. Registration of transfer of shares shall only be made upon the
books of the Company by the registered holder in person, or by power of
attorney, duly executed, witnessed and filed with the Secretary or other
proper officer of the Company, on the surrender of the certificate or
certificates of such shares properly assigned for transfer.
ARTICLE VIII
CONSTRUCTION
SECTION 1. The masculine gender, when appearing in these By-Laws, shall
be deemed to include the feminine gender.
ARTICLE IX
AMENDMENTS
SECTION 1. These By-Laws may be altered, amended or added to by the Board
of Directors at any meeting, or by the stockholders at any annual or special
meeting, provided notice thereof has been given.
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Legal Title of Bank: Bankers Trust Company Call Date: 09/30/98 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR SEPTEMBER 30, 1998
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, reported the amount outstanding as of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
---------------
| C400 |
Dollar Amounts in Thousands | RCFD Bil Mil Thou |
<S> <C> <C>
ASSETS | / / / / / / / / / / / / / / / |
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / / / / / |
a. Noninterest-bearing balances and currency and coin (1) ................. | 0081 2,291,000 |1.a.
b. Interest-bearing balances (2) ......................................... | 0071 2,636,000 |1.b.
2. Securities: | / / / / / / / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) ............ | 1754 0 |2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)........... | 1773 6,617,000 |2.b.
3. Federal funds sold and securities purchased under agreements to resell.... | 1350 32,734,000 |3.
4. Loans and lease financing receivables: | / / / / / / / / / / / / / / / |
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 20,227,000 | / / / / / / / / / / / / / / / |4.a.
b. LESS: Allowance for loan and lease losses.....................RCFD 3123 619,000 | / / / / / / / / / / / / / / / |4.b.
c. LESS: Allocated transfer risk reserve.........................RCFD 3128 0 | / / / / / / / / / / / / / / / |4.c.
d. Loans and leases, net of unearned income, | / / / / / / / / / / / / / / / |
allowance, and reserve (item 4.a minus 4.b and 4.c).................... | 2125 19,608,000 |4.d.
5. Trading Assets (from schedule RC-D)....................................... | 3545 49,545,000 |5.
6. Premises and fixed assets (including capitalized leases).................. | 2145 885,000 |6.
7. Other real estate owned (from Schedule RC-M).............................. | 2150 115,000 |7.
8. Investments in unconsolidated subsidiaries and associated companies
(from Schedule RC-M) | 2130 391,000 |8.
9. Customers' liability to this bank on acceptances outstanding.............. | 2155 392,000 |9.
10. Intangible assets (from Schedule RC-M).................................... | 2143 266,000 |10.
11. Other assets (from Schedule RC-F)......................................... | 2160 5,884,000 |11.
12. Total assets (sum of items 1 through 11).................................. | 2170 121,364,000 |12.
--------------------------
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Legal Title of Bank: Bankers Trust Company Call Date: 09/30/98 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State Zip: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
</TABLE>
SCHEDULE RC--CONTINUED
<TABLE>
<CAPTION>
Dollar Amounts in Thousands | / / / / / Bil Mil Thou__|
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
LIABILITIES | / / / / / / / / / / / / / / |
13. Deposits: | / / / / / / / / / / / / / / |
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I) | RCON 2200 22,231,000 |13.a.
(1) Noninterest-bearing(1).............................RCON 6631 3,040,000..... | / / / / / / / / / / / / / / |13.a.(1)
(2) Interest-bearing...................................RCON 6636 19,191,000..... | / / / / / / / / / / / / / / |13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E | / / / / / / / / / / / / / / |
part II) | RCFN 2200 21,932,000 |13.b.
(1) Noninterest-bearing ...............................RCFN 6631 2,423,000 | / / / / / / / / / / / / / / |13.b.(1)
(2) Interest-bearing ..................................RCFN 6636 19,509,000 | / / / / / / / / / / / / / / |13.b.(2)
14. Federal funds purchased and securities sold under agreements to repurchase | RCFD 2800 14,360,000 |14.
15. a. Demand notes issued to the U.S. Treasury............................... | RCON 2840 0 |15.a.
b. Trading liabilities (from Schedule RC-D)............................... | RCFD 3548 32,890,000 |15.b.
16. Other borrowed money (includes mortgage indebtedness and obligations under
capitalized leases): | / / / / / / / / / / / / / / |
a. With a remaining maturity of one year or less ......................... | RCFD 2332 7,653,000 |16.a.
b. With a remaining maturity of more than one year through three years... | A547 3,707,000 |16.b.
c. With a remaining maturity of more than three years..................... | A548 3,034,000 |16.c
17. Not Applicable. | / / / / / / / / / / / / / / |17.
18. Bank's liability on acceptances executed and outstanding.................. | RCFD 2920 392,000 |18.
19. Subordinated notes and debentures (2)..................................... | RCFD 3200 1,533,000 |19.
20. Other liabilities (from Schedule RC-G) ................................... | RCFD 2930 6,595,000 |20.
21. Total liabilities (sum of items 13 through 20)............................ | RCFD 2948 114,327,000 |21.
22. Not Applicable | / / / / / / / / / / / / / / |
| / / / / / / / / / / / / / / |22.
EQUITY CAPITAL | / / / / / / / / / / / / / / |
23. Perpetual preferred stock and related surplus ............................. | RCFD 3838 1,500,000 |23.
24. Common stock.............................................................. | RCFD 3230 2,002,000 |24.
25. Surplus (exclude all surplus related to preferred stock) ................. | RCFD 3839 540,000 |25.
26. a. Undivided profits and capital reserves................................. | RCFD 3632 3,421,000 |26.a.
b. Net unrealized holding gains (losses) on available-for-sale securities. | RCFD 8434 ( 46,000) |26.b.
27. Cumulative foreign currency translation adjustments....................... | RCFD 3284 ( 380,000) |27.
28. Total equity capital (sum of items 23 through 27)......................... | RCFD 3210 7,037,000 |28.
29. Total liabilities and equity capital (sum of items 21 and 28)............. | RCFD 3300 121,364,000 |29
| ----------- |
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the
most comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1997...............................................| RCFD 6724 1 | M.1
-------------------------------------
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required
by state chartering authority)
</TABLE>
- ----------------------
(1) Including total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
