AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 7, 1999
REGISTRATION STATEMENT NO. 333-84353
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
RECKSON SERVICE INDUSTRIES, INC.
(Exact name of each registrant as specified in its charter)
DELAWARE 11-3383642
(State or other jurisdiction I.R.S. employer identification number)
of incorporation or organization)
10 EAST 50TH STREET
NEW YORK, NEW YORK 10022
(212) 753-6363
(Address, including zip code, and telephone number, including
area code, of each registrant's principal executive office)
SCOTT H. RECHLER
PRESIDENT AND CHIEF EXECUTIVE OFFICER
RECKSON SERVICE INDUSTRIES, INC.
10 EAST 50TH STREET
NEW YORK, NEW YORK 10022
(212) 931-8000
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
-------------------
COPIES TO:
EDWARD F. PETROSKY, ESQ.
J. GERARD CUMMINS, ESQ.
BROWN & WOOD LLP
ONE WORLD TRADE CENTER, 58TH FLOOR
NEW YORK, N.Y. 10048
-------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC:
From time to time after this Registration Statement becomes effective.
-------------------
If the only securities being registered on this form are being
offered pursuant to dividend or interest reinvestment plans, please check the
following box.|_|
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, as amended (the "Securities Act"), other than
securities offered only in connection with dividend or interest reinvestment
plans, please check the following box.|X|
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.|_|
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.|_|
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box.|X|
-------------------
<PAGE>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=========================================================================== ========================= ============================
<S> <C> <C>
Title of Class of Proposed Maximum Amount of
Securities to be Registered Aggregate Offering Registration Fee(7)(8)
Price(1)
Common Stock, $.01 par value per share(2), Common Stock Warrants(3),
Preferred Stock(4), Depositary Shares representing Preferred Stock (5), $500,000,000 $139,000
Preferred Stock Warrants and Debt Securities(6)
========================================================================== ========================== =============================
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee.
(2) Such indeterminate number of shares of common stock of Reckson
Service Industries, Inc. as may from time to time be issued at
indeterminate prices, upon exercise of common stock warrants of
Reckson Service Industries, Inc. or upon conversion of preferred
stock for debt securities of Reckson Service Industries, Inc., as the
case may be.
(3) Warrants to purchase common stock of Reckson Service Industries, Inc.
may include rights to purchase common stock of Reckson Service
Industries, Inc. issued as a dividend to holders of such common
stock, for which no separate consideration is received.
(4) Such indeterminate number of shares of preferred stock of Reckson
Service Industries, Inc. as may from time to time be issued in series
at indeterminate prices, upon exercise of preferred stock warrants of
Reckson Service Industries, Inc. or upon conversion of debt
securities of Reckson Service Industries, Inc., as the case may be.
(5) To be represented by depositary receipts of Reckson Service
Industries, Inc. representing an interest in all or a specified
portion of a share of preferred stock of Reckson Service Industries,
Inc.
(6) Such indeterminate principal amount of debt securities of Reckson
Service Industries, Inc. as may from time to time be issued in series
at indeterminate prices or upon conversion of preferred stock of
Reckson Service Industries, Inc., as the case may be; or, in the
event of the issuance of original issue discount securities, a higher
principal amount as may be sold for an aggregate initial offering
price not to exceed $500,000,000.
(7) Calculated pursuant to Rule 457(o) under the Securities Act.
(8) Previously paid.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON THE 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 WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON THE DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
<PAGE>
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED DECEMBER 7, 1999
PROSPECTUS
$500,000,000
RECKSON SERVICE INDUSTRIES, INC.
COMMON STOCK, COMMON STOCK WARRANTS,
PREFERRED STOCK, PREFERRED STOCK WARRANTS, DEPOSITARY SHARES
AND DEBT SECURITIES
-----------------
Reckson Service Industries, Inc. may offer up to $500,000,000 of
shares of our common stock, shares of our preferred stock, depositary shares
representing interests in our preferred stock, warrants to purchase shares of
our common stock (including rights to purchase our common stock) or preferred
stock and our debt securities in one or more series. Our common stock is
listed on the Nasdaq National Market under the symbol "RSII."
We may offer the securities at prices and on terms to be set forth in
one or more supplements to this prospectus. The securities may be offered
directly, through agents on our behalf or through underwriters or dealers.
SEE "RISK FACTORS" BEGINNING ON PAGE 2 OF THIS PROSPECTUS FOR A
DESCRIPTION OF RISKS THAT SHOULD BE CONSIDERED BY PURCHASERS OF THE
SECURITIES.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these securities or
determined if this prospectus is truthful or complete. Any representation to
the contrary is a criminal offense.
The information contained 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 it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
The date of this prospectus is ___________ __, 1999.
<PAGE>
RISK FACTORS
This prospectus contains forward-looking statements which involve
risks and uncertainties. Our actual results may differ significantly from the
results discussed in the forward-looking statements. Factors that might cause
a difference include, but are not limited to, those discussed below. An
investment in the securities involves various risks. Prospective investors
should carefully consider the following information in conjunction with the
other information contained in this prospectus and the related prospectus
supplement before purchasing the securities offered by the related prospectus
supplement.
OUR LACK OF OPERATING HISTORY IMPAIRS OUR ABILITY TO PREDICT FUTURE EARNINGS
AND WE HAVE SUSTAINED OPERATING LOSSES SINCE OUR INCEPTION
We were formed in July 1997 and have operated as a public company
since June 1998. We have sustained operating losses since our inception and
expect to sustain operating losses in the near future. The financial
information relating to us and our subsidiaries and their respective assets
included or incorporated by reference in this prospectus are not necessarily
indicative of our or our subsidiaries' future consolidated financial condition
or results of operations.
CERTAIN MEMBERS OF OUR SENIOR MANAGEMENT LACK EXPERIENCE IN OUR INVESTMENT
SECTORS
Three of the nine members of our senior management, including our
chief executive officer, are executive officers of Reckson Associates Realty
Corp. ("Reckson Associates"), a New York Stock Exchange-listed real estate
investment trust ("REIT"), and have served as part of our senior management
since prior to the spin-off distribution of our shares from Reckson
Associates. Although subsequent to the spin-off we have retained members of
senior management who have relevant experience and we may retain the
management of the businesses that we acquire, the primary experience of those
three officers is in the business of acquiring, developing, and re-developing
suburban office and industrial properties in the New York "Tri-State" area and
not in pursuing our investment objectives.
WE CANNOT ASSURE OUR ABILITY TO MANAGE GROWTH
We intend to expand our operations through the acquisition of, or
investment in, B2B e-commerce and e-services companies (each a "partner
company"). In addition, Reckson Strategic Venture Partners, LLC, our
subsidiary ("Reckson Strategic Venture Partners"), may also expand rapidly
through the acquisition of real estate and real estate operating companies.
The success of our growth strategies will depend on our ability to identify
attractive business opportunities and effectively operate and integrate any
newly acquired businesses. Our growth plans will require the participation of,
and place demands upon, our management and operating personnel. Our ability to
manage future growth effectively requires the development of operational,
financial and management information systems. We cannot assure that we will
effectively manage our growth. If we are unable to manage our growth
effectively, it may adversely affect our business, results of operations and
financial condition.
OUR STRATEGY OF GROWTH THROUGH ACQUISITIONS INVOLVES RISKS AND MAY RESULT IN
LOSSES
Acquisition is a significant source of our growth. We cannot assure
that suitable acquisition opportunities will be available to us or our
affiliates. We also cannot assure that we or our affiliates will not overpay
for acquisitions or the efficient and adequate integration of these
acquisitions. Significant competition may exist for targeted acquisitions.
Some of the companies in which we acquire an interest may have (i) little or
no operating histories, (ii) historical operating losses, and (iii)
competitors that are larger and more well capitalized. Some of our or our
affiliates' acquisitions may be involved in sectors that are subject to
increasing competition. As a result, the costs incurred to acquire or
reposition companies may be significant and non-recoverable. Furthermore, we
can not assure that acquisitions will not result in additional losses.
The acquisition of interests in start-up or early stage companies,
particularly in the Internet area, involves a high degree of business and
financial risk that can result in substantial losses. Among these are the
risks associated with investment in companies in an early stage of development
or with little or no operating history, companies operating at a loss or with
substantial variations in operating results from period to period, and
companies with the need for substantial additional capital to support
expansion or to achieve or maintain a competitive position. Such companies may
face intense competition, including competition from companies with greater
financial resources, more extensive development, manufacturing, marketing and
service capabilities, and a larger number of qualified managerial and
technical personnel. We may take significant positions in companies in rapidly
changing high-technology and internet fields; such companies may face special
risks of product obsolescence and may encounter intense competition from other
companies financed by venture capitalists. In addition, start-up companies may
require significant additional capital contributions from us.
We may hold our interests in start-up or early stage companies for an
indefinite period of time; and it may take several years from the date of our
initial acquisition of such interest for the start-up company to reach such a
state of maturity that disposition could be considered.
It is anticipated that a substantial portion of our holdings may
consist of securities that are subject to restrictions on sale because they
were acquired from the issuer in "private placement" transactions or because
we might be deemed to be an affiliate of the issuer. Generally, we would not
be able to sell these securities publicly without the expense and time
required to register the securities under the Securities Act or to sell the
securities under Rule 144 or other rules under the Securities Act which permit
only limited sales under specified conditions. When restricted securities are
sold to the public, we could be deemed an "underwriter", or possibly a
controlling person, with respect thereto for the purpose of the Securities Act
and be subject to liability as such under that Act.
In addition, practical limitations may inhibit our ability to sell
our holdings because the issuers thereof are privately held, we own a
relatively large percentage of the issuer's outstanding securities, or the
customers, joint venture associates, other investors, financial institutions
or management are relying on our continued investment. Sales may also be
limited by securities market conditions, which may be unfavorable for sales of
securities of particular issuers or issuers in particular industries. The
above limitations on liquidity of our holdings could prevent a successful sale
thereof, result in delay of any sale or reduce the amount of proceeds that
might otherwise be realized.
DEPENDENCE ON FUTURE MARKET CONDITIONS
Our strategy involves creating value for our shareholders by helping
our partner companies develop and effectively execute their business plans.
Depending upon our partner companies' success in executing their business plans
and future market conditions, some of such partner companies may seek to
complete initial public offerings of their shares. We expect to retain a
significant ownership portion after a partner company goes public. If the
public market in general, or the market for Internet-related companies in
particular, were to weaken for a prolonged period of time, the ability of our
partner companies to complete public offerings would be materially adversely
affected. In addition, future weakness in the public markets, particularly the
market for Internet-related companies, may adversely affect the value of our
common stock, as well as the value of the stock of our partner companies.
OUR BUSINESS AND FUTURE OPPORTUNITIES ARE RESTRICTED
We are prohibited under the intercompany agreement between us and
Reckson Operating Partnership, L.P. ("Reckson Operating Partnership") from
making REIT-Qualified investments unless Reckson Operating Partnership is
given the right of first opportunity in respect of those investments and
chooses not to pursue the investments. In addition, if an investment becomes
available to one of our affiliates, the affiliate is required to allow Reckson
Operating Partnership to participate in the investment to the extent of our
interest in the investment. Our charter provides that one of our corporate
purposes is to perform our obligations under the intercompany agreement. We
are also required to assist Reckson Operating Partnership in structuring and
consummating any REIT-Qualified investment presented to Reckson Operating
Partnership which it elects to pursue. As a result, our and our affiliates'
business and future opportunities are restricted.
WE ARE HIGHLY DEPENDENT UPON RECKSON OPERATING PARTNERSHIP FOR FINANCING
We rely significantly on Reckson Operating Partnership for the
financing of our operations. As a result, if Reckson Associates is unable to
access the financial markets, our ability to finance operations may be
severely restricted. In addition, if Reckson Associates should fail to qualify
as a REIT or have a decline in its financial or other condition or earnings,
affairs or prospects, it may substantially and adversely affect our ability to
pursue business opportunities and our financial condition. Investors should
review the section captioned "-- We may have conflicts of interest with
Reckson Associates -- Conflicts in our loans with Reckson Operating
Partnership; limitation on our ability to pay dividends and incur additional
debt."
WE RELY HEAVILY ON KEY PERSONNEL
Our success and the success of our partner companies depends
significantly upon the contribution of our executive officers, senior
management, and other key personnel that we retain. None of our executive
officers have an employment agreement with our company. The two managing
directors of Reckson Strategic Venture Partners (the "Reckson Strategic
Venture Partners Managing Directors") have entered into employment contracts
with RSVP Holdings, LLC, the managing member of Reckson Strategic Venture
Partners. Conversely, two of our executive officers have employment agreements
with Reckson Associates pursuant to which they have agreed to spend as much
time as may be necessary in carrying out their duties to Reckson Associates.
These executive officers do not have similar obligations to the Company.
Furthermore, we cannot assure that we or our partner companies will retain key
managerial and other personnel or attract suitable replacements or additional
personnel if required. We have not obtained key-man insurance for any of our
executive officers or other key personnel.
WE MAY HAVE CONFLICTS OF INTERESTS WITH RECKSON ASSOCIATES
CONFLICTS AS A RESULT OF OVERLAPPING MANAGEMENT. Our President and
Chief Executive Officer, Chairman of the Board, Chief Financial Officer, and
General Counsel each serve in similar capacities for Reckson Associates. In
addition, four members of our Board of Directors also serve as directors of
Reckson Associates. Although each of the individuals referred to above is
committed to our success, they are also committed to the success of Reckson
Associates. As of September 30, 1999, Reckson Associates' senior management
and directors beneficially owned approximately 10% of the outstanding common
stock of Reckson Associates and approximately 35% of our outstanding common
stock. In calculating the ownership of common stock of Reckson Associates, we
have included Reckson Associates common stock and its Class B exchangeable
common stock; and we have assumed the exchange of all limited partnership
units in Reckson Operating Partnership for shares of common stock and the
exercise of all vested stock options. There is a risk that the common
membership of management, members of the Boards of Directors and ownership of
Reckson Associates and the Company will lead to conflicts of interest in the
fiduciary duties owed to stockholders by common directors and officers in
connection with transactions between the two companies, as well as a conflict
in allocating management time.
CONFLICTS UNDER THE INTERCOMPANY AGREEMENT. In connection with the
spin-off distribution of our common stock, we entered into an intercompany
agreement with Reckson Operating Partnership to formalize our relationship at
the outset and to limit conflicts of interest. The intercompany agreement was
not negotiated at arms' length since 95% of our capital stock was owned by
Reckson Operating Partnership at the time it was executed. Under the
intercompany agreement, we granted Reckson Operating Partnership a right of
first opportunity to make any REIT-qualified investment that becomes available
to us. In addition, if a REIT-qualified investment opportunity becomes
available to an affiliate of ours, including Reckson Strategic Venture
Partners, 100% of the common ownership interest of which is indirectly owned
by us, the intercompany agreement requires our affiliate to allow Reckson
Operating Partnership to participate in the opportunity to the extent of our
interest in the affiliate.
Under the intercompany agreement, Reckson Operating Partnership
granted us a right of first opportunity to provide to Reckson Operating
Partnership and its tenants any type of non-customary commercial services for
occupants of office, industrial and other property types, which Reckson
Associates may not be permitted to provide because they may generate REIT
non-qualifying income under Federal tax laws. We will provide services to
Reckson Operating Partnership at rates and on terms as attractive as either
the best available for comparable services in the market or those offered by
us to third parties. In addition, Reckson Operating Partnership will give us
access to its tenants with respect to commercial services that may be provided
to tenants.
Under the intercompany agreement, subject to certain conditions,
Reckson Operating Partnership granted us a right of first refusal to become
the lessee of any real property acquired by Reckson Operating Partnership if
it determines that the operation of the property may involve the performance
of non-customary services that would jeopardize Reckson Associates' REIT
status, it is required to enter into a "master" lease arrangement. Pursuant to
a this "master" lease arrangement, Reckson Operating Partnership would own the
property, but lease it entirely to a single lessee that would operate the
property.
With respect to services that we will provide to Reckson Operating
Partnership, management will have a conflict of interest relating to the
market rates being charged to Reckson Operating Partnership for these
services. In addition, management will have a conflict of interest in
determining whether we or Reckson Operating Partnership should pursue a
REIT-qualified investment opportunity outside of Reckson Associates' core
business strategy of investing in office and industrial properties in the New
York Tri-State area. Furthermore, we and Reckson Operating Partnership may
structure investments so that Reckson Operating Partnership - Reckson
Strategic Venture Partners joint ventures may pursue the portion of
investments generating REIT-qualified income and Reckson Strategic Venture
Partners will pursue directly the other portion of these investments.
Accordingly, Reckson Strategic Venture Partners and Reckson Operating
Partnership - Reckson Strategic Venture Partners joint ventures may have
conflicts of interest in the structuring, valuation, management and
disposition of these investments.
CONFLICTS IN OUR LOANS WITH RECKSON OPERATING PARTNERSHIP; LIMITATION
ON OUR ABILITY TO PAY DIVIDENDS AND INCUR ADDITIONAL DEBT. In June 1998, we
established a credit facility with Reckson Operating Partnership (the "Reckson
Service Industries Facility") in the amount of $100 million for our service
sector operations and other general corporate purposes. In addition, in June
1998, Reckson Operating Partnership authorized the investment of $100 million
with respect to the funding of the investment of Reckson Strategic Venture
Partners (the "Reckson Strategic Venture Partners Commitment"). Amounts
available under the Reckson Strategic Venture Partners Commitment are funded
through investments by Reckson Operating Partnership into joint ventures with
Reckson Strategic Venture Partners or through loans directly to the Company
under a credit agreement with terms substantially identical to those under the
Reckson Service Industries Facility. Although the credit agreement provides
for the borrowing of up to $100 million from Reckson Operating Partnership,
the amount available is reduced by the amount of any joint venture investments
between Reckson Operating Partnership and Reckson Strategic Venture Partners.
Loans under the Reckson Strategic Venture Partners Commitment in excess of $25
million in any single investment are subject to approval by the Board of
Directors of Reckson Associates, while advances under the Reckson Service
Industries Facility in excess of $10 million in respect of any single
investment are subject to approval by the Board of Directors of Reckson
Associates, or a committee thereof. The Reckson Service Industries Facility
has a term of five years and advances thereunder are recourse obligations of
our company. Interest accrues on advances made under the Reckson Service
Industries Facility at a rate equal to the greater of (1) the prime rate plus
2% and (2) 12% per annum, with the rate on amounts that are outstanding for
more than one year increasing annually at a rate of 4% of the prior year's
rate. Prior to maturity, interest is payable quarterly but only to the extent
of net cash flow and on an interest-only basis and is prepayable without
penalty at our option.
As long as there are outstanding advances under the Reckson Service
Industries Facility or borrowings by us under the credit agreement with
respect to the Reckson Strategic Venture Partners Commitment, we are
prohibited from paying dividends on any shares of our capital stock or
incurring additional debt. The Reckson Service Industries Facility and the
credit agreement with respect to the Reckson Strategic Venture Partners
Commitment are subject to certain other covenants and prohibit advances
thereunder to the extent the advances could, in Reckson Associates'
determination, endanger the status of Reckson Associates as a REIT. The terms
of the Reckson Service Industries Facility and the credit agreement with
respect to the Reckson Strategic Venture Partners Commitment were not
negotiated at arms' length and thus may not reflect terms that could have been
obtained from independent third parties. Additional indebtedness may be
incurred by our subsidiaries. As of September 30, 1999, borrowings under the
Reckson Service Industries Facility aggregated approximately $83.6 million and
pursuant to the Reckson Strategic Venture Partners Commitment, Reckson
Operating Partnership had made approximately $21.7 million in joint venture
investments with Reckson Strategic Venture Partners and had loaned
approximately $32.9 million under the credit agreement. In November 1999, the
credit facilities were amended to allow the Company to incur up to $135
million in debt secured by Company assets and to pay interest thereon, and to
allow the payment of dividends on up to $200 million of preferred stock which
may be issued by the Company. As consideration for the amendments, which were
approved by the Board of Directors of both the Company and Reckson Associates,
we paid a fee to Reckson Operating Partnership in the form of approximately
176,000 shares of our common stock.
POLICIES WITH RESPECT TO CONFLICTS OF INTEREST MAY NOT BE SUCCESSFUL.
We have adopted policies designed to eliminate or minimize conflicts of
interest. These policies include the approval of all transactions in which our
directors or officers have a conflicting interest by a majority of the
directors who are neither officers nor affiliated with us. These policies do
not prohibit sales of assets to or from affiliates, but would require the
sales to be approved by the independent directors of the Company. However,
there is no assurance that these policies will be successful and, if they are
not successful, decisions could be made that might fail to reflect fully the
interests of all of our stockholders.
WE HAVE NO PRIOR SPONSORSHIP OF A VENTURE CAPITAL VEHICLE AND MAY INVEST IN
COMPANIES IN AN EARLY STAGE OF DEVELOPMENT OR WITH HISTORICAL OPERATING LOSSES
Reckson Strategic Venture Partners is a real estate venture capital
entity formed to acquire interests in real estate and real estate-related
operating companies. We have committed up to $100 million in Reckson Strategic
Venture Partners although such commitment is reduced by the amount of any
investments made by Reckson Operating Partnership into joint ventures with
Reckson Strategic Venture Partners. A subsidiary of ours serves as the
managing member of Reckson Strategic Venture Partners. Neither we nor Reckson
Associates have previously sponsored a real estate venture capital entity.
Reckson Strategic Venture Partners' holdings may include, among other things,
holdings in companies in an early stage of development that have historical
operating losses. In addition, decreases in values in the property markets,
volatility in the securities markets, interest rate increases and unfavorable
conditions in the economy generally, and in the real estate industry in
particular, may have a negative impact on the performance of Reckson Strategic
Venture Partners.
Reckson Strategic Venture Partners has obtained a $200 million
preferred equity facility from PaineWebber Real Estate Securities ("PWRES"),
which is partially funded by an investment fund that is jointly sponsored by
financier George Soros and PWRES. Under the terms of the PaineWebber equity
facility, Reckson Strategic Venture Partners is subject to various covenants
and events of default and related remedies. Such remedies include increased
control rights of PWRES over the operation of Reckson Strategic Venture
Partners under certain circumstances. In addition, PWRES and such investment
fund, if applicable, receive a priority or preferred distribution from the
operations of Reckson Strategic Venture Partners prior to the distribution of
cash to our subsidiary serving as the managing member of Reckson Strategic
Venture Partners. The Reckson Strategic Venture Partners Managing Directors
are entitled to a portion of the profits of the managing member of Reckson
Strategic Venture Partners after we obtain a return of our capital plus a
minimum return. As a result, we cannot assure that the Reckson Strategic
Venture Partners Managing Directors will not pursue investments involving
greater risk in seeking higher profits. Any investments identified by the
Reckson Strategic Venture Partners Managing Directors are subject to our
approval.
OWNERSHIP OF ASSETS THROUGH PARTNER COMPANIES AND JOINT VENTURES COULD LIMIT
OUR CONTROL OF THOSE INVESTMENTS
We and Reckson Strategic Venture Partners anticipate holding a
significant portion of our assets through ownership of an interest in joint
ventures and in partner companies in which we own a significant interest and
participate in management and other parties also own an interest. These
investments may involve risks not otherwise present for investments made
solely by us, including the possibility that our co-venturer or other owners
of partner companies might become bankrupt, that our co-venturer or other
owners of partner companies might at any time have different interests or
goals than we do, and that our co-venturer or other owners of partner
companies may take action contrary to our instructions, requests, policies or
objectives. Other risks of joint venture investments and holdings in partner
companies include impasse on decisions, such as a sale, because neither our
partner or co-venturer nor us would have full control over the joint venture
or partner company. There is no limitation under our organizational documents
as to the amount of funds that may be invested in joint ventures or partner
companies.
In addition, if we do not control sufficiently one or more of our
partner companies, our investment in those companies may be considered
"investment securities" under the Investment Company Act of 1940 (the "1940
Act"). Generally, any company that owns investment securities with a value
exceeding 40% of its total assets (excluding cash items and government
securities) is an "investment company" subject to registration under, and
compliance with, the 1940 Act, unless a particular exemption or safe harbor
applies. Compliance with the 1940 Act might be very costly and difficult. In
addition, there could be negative consequences if we are found to be operating
as an unregistered investment company. At the same time, if we are required to
take actions, such as the acquisition or disposition of investments, to avoid
being considered an investment company it also may have negative consequences.
Accordingly, matters related to the 1940 Act may at any time harm our business
and results of operations.
OUR HOLDINGS IN ONSITE ACCESS, INC., A COMPANY WITH A LIMITED OPERATING
HISTORY, EXPOSE US TO REGULATORY RISKS AS WELL AS THE RISK OF TECHNOLOGICAL
OBSOLESCENCE
Our holdings include an approximately 36% fully-diluted interest in
Onsite Access, Inc. ("Onsite"). Onsite is a privately-held company that
provides advanced telecommunication systems and services within commercial
buildings. Onsite has been in existence since 1999, has a relatively small
capitalization, and has historical operating losses. We anticipate that Onsite
will continue to grow rapidly, but we cannot assure when, if ever, Onsite will
become profitable. OnSite's success is contingent upon its ability to continue
to obtain contracts to wire buildings for the delivery of internet access,
data and voice transport services. In addition, certain executive officers at
Onsite have only recently been hired and Onsite's future success will be
dependent, in part, on such executives' ability to perform effectively.
Our holdings in Onsite are exposed to risks specific to the
telecommunications industry. The industry is regulated on both the federal and
state level and we can not assure that governmental regulations that adversely
affect our investment will not be passed. Additionally, the technology sector
is constantly undergoing rapid change and innovation. Onsite is therefore
subject to the risk that its technological services could become obsolete.
OUR HOLDINGS IN VANTAS INCORPORATED EXPOSE US TO REAL ESTATE AND OPERATIONAL
RISKS
Our holdings include an approximately 45% fully diluted interest in
VANTAS Incorporated ("VANTAS"). VANTAS is a company that provides tenants with
furnished office suites and immediate support services, included but not
limited to, secretarial services, telecommunication services and conference
facilities. The executive office suites industry is subject to risks
comparable to the real estate industry. Supply and demand and the location of
office buildings are all factors that directly affect the office suites
industry. A significant downturn in the real estate market could adversely
affect our investment in VANTAS.
VANTAS is the successor to three separate executive office suites
companies. The management team at VANTAS has not worked together as a unit for
a long period and we cannot assure that the integration of the three office
suites companies will be successful.
THE STUDENT HOUSING SECTOR EXPOSES US TO PARTICULAR RISKS
Through Reckson Strategic Venture Partners, we hold a 77.77% in
American Campus Communities, a manager of student housing facilities, and a
23.33% interest in the Dobie Center, a student housing facility located near
the campus of the University of Texas. The student housing business is a
fragmented sector undergoing rapid development and change. In addition to
traditional real estate risks, student housing risks include economic, social,
governmental and demographic factors as they relate to the number of students
attending colleges and universities in need of student housing. Student
housing facilities are to a large extent reliant upon the well-being of the
colleges or universities to which such facilities relate. Student housing
facilities are possibly subject to competition from colleges and universities
as well as other providers of student housing. In addition, the maintenance
and insurance costs of student housing may exceed the costs typical of
multifamily housing. Furthermore, due to the nature of student housing,
turnover of tenants is significant and student housing is less utilized during
summer months.
WE DO NOT ANTICIPATE PAYING DIVIDENDS IN THE FORESEEABLE FUTURE
We intend to use our available funds to pursue investment and
business opportunities. Therefore, we do not anticipate the payment of any
dividends on our common stock in the foreseeable future. Payment of dividends
on our common stock is prohibited under the credit facilities until all
amounts outstanding under the credit facilities are paid in full. The payment
of dividends will also be subject to any limitations imposed by other credit
facilities and debt securities that we may obtain or issue in the future.
REAL ESTATE RISKS MAY AFFECT OUR EARNINGS
Our holdings include real estate and real estate-related assets,
particularly through our holdings in Reckson Strategic Venture Partners.
Investments in real estate are subject to the risks incident to the ownership
and operation of real estate. Our real estate holdings may be adversely
affected by a number of factors, including:
o real estate holdings are generally illiquid
o the national, state and local economic climate and real estate
conditions, such as oversupply of or reduced demand for space and
changes in market rental rates
o the need to periodically renovate, repair and relet our space
o increasing operating costs, including real estate taxes and
utilities, which may not be passed through to tenants
o defaults by our tenants or their failure to pay rent on a timely
basis
o uninsured losses
Through Reckson Strategic Venture Partners, we have real estate and
real estate-related holdings in the areas of student housing, assisted living
and government occupied buildings. Reckson Strategic Ventures Partners is
likely to make additional acquisitions in commercial real estate, and may,
particularly through joint ventures, be involved in the development of real
estate. Development and construction activities in connection with these types
of investments include risks of cost overruns, completion and lease-up delays,
unavailability of financing and changes in market conditions.
Our development activities are also subject to risks relating to the
inability to obtain, or delays in obtaining, all necessary zoning, land-use,
building, occupancy and other required governmental permits and
authorizations. If any of the above events occur, the revenues received from
Reckson Strategic Venture Partners' real estate investments and the values of
these investments could be adversely affected. In addition, new development
activities, regardless of whether or not they are ultimately successful,
typically require a substantial portion of management's time and attention.
ENVIRONMENTAL PROBLEMS ARE POSSIBLE AND MAY BE COSTLY
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 or petroleum product releases at a property. An owner of real
estate is liable for the costs of removal or remediation of certain hazardous
or toxic substances on or in the property. These laws often impose such
liability without regard to whether the owner knew of, or caused, the presence
of the contaminants. Clean-up costs and the owner's liability generally are
not limited under the enactments and could exceed the value of the property
and/or the aggregate assets of the owner. The presence of or the failure to
properly remediate the substances may adversely affect the owner's ability to
sell or rent the property or to borrow using the property as collateral.
Persons who arrange for the disposal or treatment of hazardous or toxic
substances may also be liable for the clean-up costs of the substances at a
disposal or treatment facility, whether or not such facility is owned or
operated by the person. Even if more than one person was responsible for the
contamination, each person covered by the environmental laws may be held
responsible for the clean-up costs incurred. In addition, third parties may
sue the owner or operator of a site for damages and costs resulting from
environmental contamination emanating from that site.
Environmental laws also govern the presence, maintenance and removal
of asbestos-containing materials ("ACMs"). These laws impose liability for
release of ACMs into the air and third parties may seek recovery from owners
or operators of real properties for personal injury associated with ACMs. In
connection with the ownership (direct or indirect), operation, management and
development of real properties, we may be considered an owner or operator of
properties containing ACMs. We may be potentially liable for removal,
remediation and other costs, including governmental fines and injuries to
persons and property.
CERTAIN ANTITAKEOVER PROVISIONS MAY DETER THIRD PARTY ACQUISITION PROPOSALS
Our charter and bylaws and applicable sections of the Delaware
General Corporation Law may make the acquisition of control of our company
more difficult without the approval of our Board of Directors. Certain
provisions of our charter and bylaws, among other things:
o classify our Board of Directors into three classes, each of which
serves for staggered three-year terms;
o provide that any of our directors may be removed by the affirmative
vote of stockholders having at least 80% of the total voting power
only for cause;
o provide that only the Chairman of the Board, President or a majority
of our Board of Directors may call special meetings of the
stockholders;
o provide that the stockholders may take action only at a meeting of
our stockholders, not by written consent;
o provide that stockholders must comply with certain advance notice
procedures in order to nominate candidates for election to our Board
of Directors or to place stockholders' proposals on the agenda for
consideration at meetings of the stockholders;
o provide that, under certain circumstances, the affirmative vote of
the holders of two-thirds of our common stock is required to approve
any merger or similar business combination involving our company;
o provide that the holder of "control shares" of our company acquired
in a control share acquisition have no voting rights with respect to
such control shares except to the extent approved by the vote of the
holders of two-thirds of our common stock;
o subject to certain exceptions, limit the ownership by any person of
our common stock to 9.9% of the number of shares or value of our
common stock and limit the ownership by any person of our capital
stock to 9.9% of the aggregate value of all classes of our capital
stock; and
o provide that the stockholders may amend or repeal any of the
foregoing provisions of the charter or bylaws only by a vote of at
least 80% of the stock entitled to vote generally in the election of
directors.
With certain exceptions, Section 203 of the Delaware General
Corporation Law imposes certain restrictions on mergers and other business
combinations between our company and any holder of 15% or more of our common
stock. The charter provides that the foregoing provisions and Section 203 do
not apply to Reckson Associates and its affiliates. Accordingly, Reckson
Associates and its affiliates are in a position to effect a business
combination or other transaction with us in situations where others are
restricted from effecting a similar transaction. Our charter authorizes the
Board of Directors to issue up to 25 million shares of preferred stock, par
value $.01 per share, in series, and to establish the rights and preferences
(including the exchange of such shares of preferred stock into shares of our
common stock) of any series of preferred stock so issued. The issuance of
certain types of preferred stock could have the effect of delaying or
preventing a change in control of our company, even if such a change in
control were in the best interests of some, or a majority, of our
stockholders.
RISK OF IMPACT OF YEAR 2000 ISSUE ON OUR OPERATIONS AND FINANCIAL RESULTS
Some of our older computer programs were written using two digits
rather than four to define the applicable year. As a result, those computer
programs have time-sensitive software that recognizes a date using "00" as the
year 1900 rather than the year 2000. This could cause a system failure or
miscalculation causing disruptions of operations, including, among other
things, a temporary inability to process transactions, or engage in similar
normal business activities.
We have completed an assessment to modify or replace portions of our
software so that our computer systems will function properly with respect to
dates in the year 2000 and thereafter. Since our accounting software is
maintained and supported by a third party, the total year 2000 project cost is
estimated to be minimal.
Our year 2000 project is complete to date. Additionally, we have
received assurances from our significant service providers that all of our
systems are currently year 2000 compliant or will be made compliant prior to
any impact on those systems. However, we cannot guarantee that all service
providers will comply with their assurances and therefore we may not be able
to determine year 2000 compliance of those contractors. At that time, we will
determine the extent to which we will be able to replace non-compliant service
providers. We believe that with modifications to existing software and
conversion to new software, the year 2000 issue will not pose significant
operational problems for our computer systems. However, if modifications and
conversions are not made, or are not completed timely, the year 2000 issue
could have a material impact on our operations.
To date, we have expended approximately $66,000 in connection with
year 2000 issues. However, there can be no guarantee that these estimates will
be achieved and actual results could differ materially from those anticipated.
Specific factors that might cause material differences include, but are not
limited to the availability and costs of personnel trained in this area, the
ability to locate and correct all relevant computer codes, and similar
uncertainties.
In a "worst case scenario" of the failure of the third party to
timely deliver the necessary upgrades to the accounting software, we would
manually process transactions, such as the issuance of disbursements, until an
alternative system is implemented.
If we are not successful in implementing our year 2000 compliance
plan, we may suffer a material adverse impact on our results of operations and
financial condition. Because of the importance of addressing the year 2000
issue, we expect to develop contingency plans if we determine that the
compliance plans will not be implemented.
AVAILABLE INFORMATION
We are subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith file reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). These reports, proxy
statements and other information may be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, as well as the regional offices of the
Commission at 7 World Trade Center (13th Floor), New York, New York 10048, and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. Copies of such information can be obtained by mail from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, at prescribed rates. The Commission maintains a Web site at
http://www.sec.gov containing reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission.
We have filed with the Commission a registration statement on Form
S-3 under the Securities Act with respect to the securities. This prospectus
does not contain all of the information set forth in the registration
statement, certain parts of which have been omitted in accordance with the
rules and regulations of the Commission. For further information regarding us
and the securities, reference is made to the registration statement, including
the exhibits filed as a part thereof, and the documents incorporated by
reference in this prospectus. Statements made in this prospectus as to the
contents of any contract, agreement or other document referred to are not
necessarily complete; with respect to each contract, agreement or other
document filed as an exhibit to the registration statement or to an Exchange
Act report, reference is made to the exhibit for a more complete description
of the matter involved, and each statement shall be deemed qualified in its
entirety by reference. Copies of the registration statement and the exhibits
may be inspected, without charge, at the offices of the Commission, or
obtained at prescribed rates from the Public Reference Section of the
Commission at the address set forth above.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents that we have previously filed with the
Commission are hereby incorporated by reference into this prospectus:
SEC FILINGS (FILE NO. 1-14183) PERIOD
Annual Report on Form 10-K Year ended December 31, 1998
Quarterly Reports on Form 10-Q Quarters ended September 30, 1999,
June 30, 1999 and March 31, 1999
Current Reports on Form 8-K Filed January 19, 1999, January 25,
(including Form 8-K/A) 1999, March 24, 1999, April 16, 1999,
July 16, 1999, August 13, 1999,
September 1, 1999, September 20, 1999,
October 12, 1999, October 14, 1999,
and October 28, 1999
Registration Statement on Form 8-A Filed June 1, 1998
We also incorporate by reference each of the following documents that
are filed with the Commission after the date of this prospectus until the
particular offering is completed or after the date of the initial registration
statement and prior to effectiveness of the registration statement:
o Reports filed under Section 13(a) and (c) of the Exchange Act;
o Definitive proxy or information statements filed under Section 14 of
the Exchange Act in connection with any subsequent stockholders'
meeting; and
o Any reports filed under Section 15(d) of the Exchange Act.
Any statement contained herein or in a document all or any portion of
which is incorporated or deemed to be incorporated by reference herein will be
deemed to be modified or superseded for purposes of this prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such earlier statement. Any statement so modified or
superseded will not be deemed, except as so modified or superseded, to
constitute a part of this prospectus.
We will provide a copy of any or all of these documents (exclusive of
exhibits unless the exhibits are specifically incorporated by reference
therein), without charge, to each person to whom this prospectus is delivered,
upon written or oral request to Reckson Service Industries, Inc., 10 East 50th
Street, New York, New York 10022, Attn: Jason M. Barnett, Executive Vice
President and General Counsel, telephone number (212) 931-8000.
THE COMPANY
We were formed on July 15, 1997. We are a publicly-traded operating
company that identifies, acquires interest in, and develops a network of
business-to-business ("B2B") e-commerce and e-services companies that service
small and medium sized enterprises, independent professionals and the mobile
workforce of larger companies. We were formed in 1997 as a subsidiary of
Reckson Associates. We were spun-off from Reckson Associates in June 1998.
We are a Delaware corporation. Our principal executive office is
located at 10 East 50th Street, New York, New York 10022, and our telephone
number is (212) 931-8000.
USE OF PROCEEDS
Unless otherwise specified in the applicable prospectus supplement,
the net proceeds from the sale of the securities offered by the applicable
prospectus supplement will be used for general corporate purposes, including
the repayment of existing indebtedness, in each case, as described in detail
in the prospectus supplement depending on the circumstances at the time of the
related offering.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth our consolidated ratios of earnings to
fixed charges for the periods shown:
<TABLE>
<CAPTION>
Nine Months ended
September 30, 1999 Year Ended December 31,
---------------------------- -------------------------------------------
1998 1997
---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges (23,530,786)(1) ($8,079,858)(1) ($257,887)(1)
</TABLE>
- -------------------
(1) Represents the excess of fixed charges over earnings.
The ratios of earnings to fixed charges were computed by dividing
earnings by fixed charges. For this purpose, earnings consist of income from
continuing operations before fixed charges. Fixed charges consist of interest
expense (including costs capitalized), rent expense and the amortization of
organization costs.
DESCRIPTION OF DEBT SECURITIES
The debt securities covered by this prospectus (the "Debt
Securities") will be issued under an Indenture (the "Indenture") among the
Company and the trustee named therein (the "Trustee"). The form of Indenture
has been filed as an exhibit to the Registration Statement of which this
prospectus is a part and is available for inspection at the corporate trust
office of the trustee. The Indenture is subject to, and governed by, the Trust
Indenture Act of 1939, as amended (the "TIA"). The statements made hereunder
relating to the Indenture and the Debt Securities to be issued thereunder are
summaries of the material provisions thereof and do not purport to be complete
and are subject to, and are qualified in their entirety by reference to, all
provisions of the Indenture and the Debt Securities. All section references
appearing herein are to sections of the Indenture, and capitalized terms used
but not defined herein shall have the respective meanings set forth in the
Indenture.
GENERAL
The Debt Securities will be direct, unsecured obligations of the
Company and will rank equally with all other unsecured and unsubordinated
indebtedness of the Company. The Debt Securities may be issued without limit
as to aggregate principal amount, in one or more series, in each case as
established from time to time in or pursuant to authority granted by a
resolution of the Board of Directors of the Company, or as established in one
or more indentures supplemental to the Indenture. All Debt Securities of 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 of the Debt
Securities of the series, for issuances of additional Debt Securities of the
same series.
The Indenture provides that there may be more than one Trustee
thereunder, each with respect to one or more series of Debt Securities. Any
Trustee under the Indenture may resign or be removed with respect to one or
more series of Debt Securities, and a successor Trustee may be appointed to
act with respect to the series. In the event that two or more persons are
acting as Trustee with respect to different series of Debt Securities, each
Trustee shall be a trustee of a trust under the Indenture separate and apart
from the trust administered by any other Trustee, and, except as otherwise
indicated herein, any action described herein to be taken by a Trustee may be
taken by each Trustee with respect to, and only with respect to, the one or
more series of Debt Securities for which it is Trustee under the Indenture.
Reference is made to the prospectus supplement relating to the series
of Debt Securities being offered for the specific terms thereof, including:
(1) the title of the Debt Securities;
(2) the aggregate principal amount of the Debt Securities and any
limit on the aggregate principal amount;
(3) the percentage of the principal amount at which the Debt
Securities will be issued and, if other than the principal
amount thereof, the portion of the principal amount thereof
payable upon declaration of acceleration of the maturity
thereof;
(4) the date or dates, or the method for determining the date or
dates, on which the principal of such Debt Securities will be
payable;
(5) the rate or rates (which may be fixed or variable), or the
method by which the rate or rates shall be determined, at which
the Debt Securities will bear interest, if any;
(6) the date or dates, or the method for determining the date or
dates, from which any interest will accrue, the dates on which
any interest will be payable, the record dates for such interest
payment dates, or the method by which any date shall be
determined, the person to whom the interest shall be payable,
and the basis upon which interest shall be calculated if other
than that of a 360-day year of twelve 30-day months;
(7) the place or places where the principal of (and premium, if any)
and interest, if any, on the Debt Securities will be payable,
the Debt Securities may be surrendered for registration of
transfer or exchange and notices or demands to or upon the
Company in respect of the Debt Securities and the Indenture may
be served;
(8) the date or dates on which or the period or periods within
which, the price or prices at which and the terms and conditions
upon which the Debt Securities may be redeemed, as a whole or in
part, at the option of the Company, if it is to have an option;
(9) the obligation, if any, of the Company to redeem, repay or
purchase the Debt Securities pursuant to any sinking fund or
analogous provision or at the option of a holder thereof, and
the date or dates on which or the period or periods within
which, the price or prices at which and the terms and conditions
upon which the Debt Securities will be redeemed, repaid or
purchased, as a whole or in part, pursuant to its obligation;
(10) if other than U.S. dollars, the currency or currencies in which
the Debt Securities are denominated and payable, which may be a
foreign currency or units of two or more foreign currencies or a
composite currency or currencies, and the terms and conditions
relating thereto;
(11) whether the amount of payments of principal of (and premium, if
any) or interest, if any, on the Debt Securities may be
determined with reference to an index, formula or other method
(which index, formula or method may, but need not be, based on a
currency, currencies, currency unit or units or composite
currency or currencies) and the manner in which the amounts
shall be determined;
(12) any additional events of default or covenants of the Debt
Securities;
(13) whether the Debt Securities will be issued in certificated
and/or book-entry form;
(14) whether the Debt Securities will be in registered or bearer form
and, if in registered form, the denominations thereof if other
than $1,000 and any integral multiple thereof and, if in bearer
form, the denominations thereof if other than $5,000 and terms
and conditions relating thereto;
(15) if the defeasance and covenant defeasance provisions described
herein are to be inapplicable or any modification of these
provisions;
(16) if the Debt Securities are to be issued upon the exercise of
debt warrants, the time, manner and place for the Debt
Securities to be authenticated and delivered;
(17) whether and under what circumstances the Company will pay
additional amounts on the Debt Securities in respect of any tax,
assessment or governmental charge and, if so, whether the
Company will have the option to redeem such Debt Securities in
lieu of making a payment;
(18) if other than the Trustee, the identity of each security
registrar and/or paying agent; and
(19) any other material terms of the Debt Securities.
The Debt Securities may provide for less than the entire principal
amount thereof to be payable upon declaration of acceleration of the maturity
thereof ("Original Issue Discount Securities"). If material or applicable,
special U.S. federal income tax, accounting and other considerations
applicable to Original Issue Discount Securities will be described in the
applicable prospectus supplement.
Except with respect to a covenant limiting the incurrence of
indebtedness, a covenant requiring a certain percentage of unencumbered assets
and a covenant requiring any successor in a business combination with the
Company to assume all of the obligations of the Company under the Indenture,
the Indenture does not contain any other provisions that would limit the
ability of the Company to incur indebtedness or that would afford Holders of
the Debt Securities protection in the case of any of the following events:
o a highly leveraged or similar transaction involving the Company,
the management of the Company, or any affiliate of any these
parties;
o a change of control; or
o a reorganization, restructuring, merger or similar transaction
involving the Company that may adversely affect the Holders of
the Debt Securities.
In addition, subject to the covenants referred to above, the Company
may, in the future, enter into certain transactions, such as the sale of all
or substantially all of its assets or the merger or consolidation of the
Company, that would increase the amount of the Company's indebtedness or
substantially reduce or eliminate the Company's assets, which may have an
adverse effect on the Company's ability to service its indebtedness, including
the Debt Securities. In addition, restrictions on ownership and transfers of
the Company's common stock and preferred stock may act to prevent or hinder a
change of control. See "Description of Common Stock--Restrictions on
Ownership" and "Description of Preferred Stock--Restrictions on Ownership."
DENOMINATIONS, INTEREST, REGISTRATION AND TRANSFER
Unless otherwise described in the applicable prospectus supplement,
the Debt Securities of any series which are registered securities, other than
registered securities issued in global form (which may be of any
denomination), shall be issuable in denominations of $1,000 and any integral
multiple thereof and the Debt Securities which are bearer securities, other
than bearer securities issued in global form (which may be of any
denomination), shall be issuable in denominations of $5,000.
Unless otherwise specified in the applicable prospectus supplement,
the principal of (and premium, if any) and interest on any series of Debt
Securities will be payable at the corporate trust office of the Trustee
provided 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 it appears in
the applicable Security Register or by wire transfer of funds to the Person at
an account maintained within the United States.
Any interest not punctually paid or duly provided for on any Interest
Payment Date with respect to a Debt Security ("Defaulted Interest") will
forthwith cease to be payable to the Holder on the applicable Regular Record
Date and may either be paid to the Person in whose name the Debt Security is
registered at the close of business on a special record date (the "Special
Record Date") for the payment of the Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to the Holder of the Debt Security not
less than 10 days prior to the Special Record Date, or may be paid at any time
in any other lawful manner, all as more completely described in the Indenture.
Subject to certain limitations imposed upon Debt Securities issued in
book-entry form, the Debt Securities of any series will be exchangeable for
other Debt Securities of the same series and of a like aggregate principal
amount and tenor of different authorized denominations upon surrender of the
Debt Securities at the corporate trust office of the Trustee referred to
above. In addition, subject to certain limitations imposed upon Debt
Securities issued in book-entry form, the Debt Securities of any series may be
surrendered for registration of transfer thereof at the corporate trust office
of the Trustee referred to above. Every Debt Security surrendered for
registration of transfer or exchange shall be duly endorsed or accompanied by
a written instrument of transfer. No service charge will be made for any
registration of transfer or exchange of any Debt Securities, but the Trustee
or the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith. If the applicable
prospectus supplement refers to any transfer agent (in addition to the
Trustee) initially designated by the Company with respect to any series of
Debt Securities, the Company may at any time rescind the designation of any
transfer agent or approve a change in the location through which any transfer
agent acts, except that the Company will be required to maintain a transfer
agent in each place of payment for the series. The Company may at any time
designate additional transfer agents with respect to any series of Debt
Securities.
Neither the Company nor the Trustee shall be required to:
o issue, register the transfer of or exchange any Debt Security if
the Debt Security may be among those selected for redemption
during a period beginning at the opening of business 15 days
before selection of the Debt Securities to be redeemed and
ending at the close of business on the day of selection;
o register the transfer of or exchange any Registered Security so
selected for redemption in whole or in part, except, in the case
of any Registered Security to be redeemed in part, the portion
thereof not to be redeemed;
o exchange any Bearer Security so selected for redemption except
that the Bearer Security may be exchanged for a Registered
Security of that series and like tenor, PROVIDED that the
Registered Security shall be simultaneously surrendered for
redemption; or
o issue, register the transfer of or exchange any Security which
has been surrendered for repayment at the option of the Holder,
except the portion, if any, of the Debt Security not to be so
repaid.
MERGER, CONSOLIDATION OR SALE
The Company may consolidate with, or sell, lease or convey all or
substantially all of its assets to, or merge with or into, any other entity,
provided that the following conditions are met:
o the Company shall be the continuing entity, or the successor
entity (if other than the Company) formed by or resulting from
any consolidation or merger or which shall have received the
transfer of assets shall expressly assume payment of the
principal of (and premium, if any) and interest on all the Debt
Securities and the due and punctual performance and observance
of all of the covenants and conditions contained in the
Indenture;
o immediately after giving effect to the transaction, no Event of
Default under the Indenture, and no event which, after notice or
the lapse of time, or both, would become an Event of Default,
shall have occurred and be continuing; and
o an officer's certificate and legal opinion covering these
conditions shall be delivered to the Trustee.
EVENTS OF DEFAULT, NOTICE AND WAIVER
The Indenture provides that the following events are "Events of
Default" with respect to any series of Debt Securities issued thereunder:
(a) default for 30 days in the payment of any installment of
interest on any Debt Security of the series;
(b) default in the payment of the principal of (or premium, if any,
on) any Debt Security of the series at its maturity;
(c) default in making any sinking fund payment as required for any
Debt Security of the series;
(d) default in the performance of any other covenant of the Company
contained in the Indenture (other than a covenant added to the
Indenture solely for the benefit of a series of Debt Securities
issued thereunder other than the series), the default having
continued for 60 days after written notice as provided in the
Indenture;
(e) the Company, any subsidiary in which the Company has invested,
or is committed or otherwise obligated to invest, at least
$20,000,000 in capital or any entity in which the Company is the
general partner shall fail to pay any principal of, premium or
interest on or any other amount payable in respect of, any
recourse Indebtedness that is outstanding in a principal or
notional amount of at least $20,000,000 (or the equivalent
thereof in one or more other currencies), either individually or
in the aggregate (but excluding Indebtedness outstanding
hereunder), of the Company and its consolidated Subsidiaries,
taken as a whole, when the same becomes due and payable (whether
by scheduled maturity, required prepayment, acceleration, demand
or otherwise), and the failure shall continue after the
applicable grace period, if any, specified in any agreement or
instrument relating to the Indebtedness, or any other event
shall occur or condition shall exist under any agreement or
instrument evidencing, securing or otherwise relating to any the
Indebtedness and shall continue after the applicable grace
period, if any, specified in the agreement or instrument, if the
effect of the event or condition is to accelerate, or to permit
the acceleration of, the maturity of the Indebtedness or
otherwise to cause, or to permit the holder or holders thereof
(or a trustee or agent on behalf of the holders) to cause the
Indebtedness to mature prior to its stated maturity;
(f) certain events of bankruptcy, insolvency or reorganization, or
court appointment of a receiver, liquidator or trustee of the
Company or any Significant Subsidiary or any of their respective
property;
(g) any other Event of Default provided with respect to a particular
series of Debt Securities.
If an Event of Default under the Indenture with respect to Debt
Securities of any series at the time Outstanding occurs and is continuing,
then in every case 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, the portion of the principal
amount as may be specified in the terms thereof) of all of the Debt Securities
of that series to be due and payable immediately by written notice thereof to
the Company (and to the Trustee if given by the Holders). However, at any time
after the declaration of acceleration with respect to Debt Securities of the
series (or of all Debt Securities then Outstanding under the Indenture, as the
case may be) has been made, but before a judgment or decree for payment of the
money due has been obtained by the Trustee, the Holders of not less than a
majority in principal amount of Outstanding Debt Securities of the series (or
of all Debt Securities then Outstanding under the Indenture, as the case may
be) may rescind and annul the declaration and its consequences if:
1. the Company shall have deposited with the Trustee all required
payments of the principal of (and premium, if any) and interest
on the Debt Securities of the series (or of all Debt Securities
then outstanding under the Indenture, as the case may be), plus
certain fees, expenses, disbursements and advances of the
Trustee; and
2. all Events of Default, other than the non-payment of accelerated
principal of (or specified portion thereof), or premium (if any)
or interest on the Debt Securities of the series (or of all Debt
Securities then Outstanding under the Indenture, as the case may
be) have been cured or waived as provided in the Indenture.
The Indenture also provides that the Holders of not less than a
majority in principal amount of the Outstanding Debt Securities of any series
(or of all Debt Securities then Outstanding under the Indenture, as the case
may be) may waive any past default with respect to the series and its
consequences, except a default
o in the payment of the principal of (or premium, if any) or
interest on any Debt Security of the series or
o in respect of a covenant or provision contained in the Indenture
that cannot be modified or amended without the consent of the
Holder of each Outstanding Debt Security affected thereby.
The Trustee will be required to give notice to the Holders of Debt
Securities within 90 days of a default under the Indenture unless the default
has been cured or waived; PROVIDED, HOWEVER, that the Trustee may withhold
notice to the Holders of any series of Debt Securities of any default with
respect to the series (except a default in the payment of the principal of (or
premium, if any) or interest on any Debt Security of the series or in the
payment of any sinking fund installment in respect of any Debt Security of the
series) if specified Responsible Officers of the Trustee consider the
withholding to be in the interest of the Holders.
The Indenture provides that no Holders of Debt Securities of any
series may institute any proceedings, judicial or otherwise, with respect to
the Indenture or for any remedy thereunder, except in the case of failure of
the Trustee, for 60 days, to act after it has received a written request to
institute proceedings in respect of an Event of Default from the Holders of
not less than 25% in principal amount of the Outstanding Debt Securities of
the series, as well as an offer of reasonable indemnity. This provision will
not prevent, however, any holder of Debt Securities from instituting suit for
the enforcement of payment of the principal of (and premium, if any) and
interest on the Debt Securities at the respective due dates thereof.
Subject to provisions in the Indenture relating to its duties in case
of default, the Trustee is under no obligation to exercise any of its rights
or powers under the Indenture at the request or direction of any Holders of
any series of Debt Securities then Outstanding under the Indenture, unless the
Holders shall have offered to the Trustee thereunder reasonable security or
indemnity. The Holders of not less than a majority in principal amount of the
Outstanding Debt Securities of any series (or of all Debt Securities then
Outstanding under the Indenture, as the case may be) shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or of exercising any trust or power conferred upon
the Trustee. However, the Trustee may refuse to follow any direction which is
in conflict with any law or the Indenture, or which may be unduly prejudicial
to the Holders of Debt Securities of the series not joining therein.
Within 120 days after the close of each fiscal year, the Company must
deliver a certificate of an officer certifying to the Trustee whether or not
the officer has knowledge of any default under the Indenture and, if so,
specifying each default and the nature and status thereof.
MODIFICATION OF THE INDENTURE
Modifications and amendments of the Indenture will be permitted to be
made only with the consent of the Holders of not less than a majority in
principal amount of all Outstanding Debt Securities or series of Outstanding
Debt Securities which are affected by the modification or amendment; PROVIDED,
HOWEVER, that no modification or amendment may, without the consent of the
Holder of each Debt Security affected thereby:
o change the Stated Maturity of the principal of, or premium (if
any) or any installment of interest on, any Debt Security,
reduce the principal amount of, or the rate or amount of
interest on, or any premium payable on redemption of, any Debt
Security, or reduce the amount of principal of an Original Issue
Discount Security that would be due and payable upon declaration
of acceleration of the maturity thereof or would be provable in
bankruptcy, or adversely affect any right of repayment of the
holder of any Debt Security, change the place of payment, or the
coin or currency, for payment of principal of, premium, if any,
or interest on any Debt Security or impair the right to
institute suit for the enforcement of any payment on or with
respect to any Debt Security;
o reduce the above-stated percentage of outstanding Debt
Securities of any series necessary to modify or amend the
Indenture, to waive compliance with certain provisions thereof
or certain defaults and consequences thereunder or to reduce the
quorum or voting requirements set forth in the Indenture;
o modify any of the foregoing provisions or any of the provisions
relating to the waiver of certain past defaults or certain
covenants, except to increase the required percentage to effect
the action or to provide that certain other provisions may not
be modified or waived without the consent of the Holder of the
Debt Security.
In addition to the Company's obligation to pay the principal of, and
premium (if any) and interest on, the Debt Securities, the Debt Securities of
a series may be entitled to the benefits of additional covenants. Neither the
Company nor the Trustee may waive compliance with such additional covenants
unless the Holders of not less than a majority in principal amount of a series
of Outstanding Debt Securities consent to the waiver.
Modifications and amendments of the Indenture will be permitted to be
made by the Company and the Trustee without the consent of any Holder of Debt
Securities for any of the following purposes:
1. to evidence the succession of another Person to the Company as
obligor under the Indenture;
2. to add to the covenants of the Company for the benefit of the
Holders of all or any series of Debt Securities or to surrender
any right or power conferred upon the Company in the Indenture;
3. to add Events of Default for the benefit of the Holders of all
or any series of Debt Securities;
4. to add or change any provisions of the Indenture to facilitate
the issuance of, or to liberalize certain terms of, Debt
Securities in bearer form, or to permit or facilitate the
issuance of Debt Securities in uncertificated form, PROVIDED
that this action shall not adversely affect the interests of the
Holders of the Debt Securities of any series in any material
respect;
5. to amend or supplement any provisions of the Indenture, PROVIDED
that no amendment or supplement shall materially adversely
affect the interests of the Holders of any Debt Securities then
Outstanding;
6. to secure the Debt Securities;
7. to establish the form or terms of Debt Securities of any series;
8. to provide for the acceptance of appointment by a successor
Trustee or facilitate the administration of the trusts under the
Indenture by more than one Trustee;
9. to cure any ambiguity, defect or inconsistency in the Indenture,
PROVIDED that this action shall not adversely affect the
interests of Holders of Debt Securities of any series in any
material respect; or
10. to supplement any of the provisions of the Indenture to the
extent necessary to permit or facilitate defeasance and
discharge of any series of the Debt Securities, PROVIDED that
the action shall not adversely affect the interests of the
Holders of the Debt Securities of any series in any material
respect.
In determining whether the Holders of the requisite principal amount
of Outstanding Debt Securities of a series have given any request, demand,
authorization, direction, notice, consent or waiver thereunder or whether a
quorum is present at a meeting of Holders of Debt Securities, the Indenture
provides that:
1. 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 the determination upon declaration of acceleration of the
maturity thereof;
2. the principal amount of a Debt Security denominated in a foreign
currency that shall be deemed Outstanding shall be the U.S.
dollar equivalent, determined on the issue date for the Debt
Security, of the principal amount (or, in the case of an
Original Issue Discount Security, the U.S. dollar equivalent on
the issue date of the Debt Security of the amount determined as
provided in (1) above);
3. the principal amount of an Indexed Security that shall be deemed
Outstanding shall be the principal face amount of the Indexed
Security at original issuance, unless otherwise provided with
respect to the Indexed Security pursuant to the Indenture; and
4. Debt Securities owned by the Company or any other obligor upon
the Debt Securities or any affiliate of the Company or of the
other obligor shall be disregarded.
The Indenture contains provisions for convening meetings of the
Holders of Debt Securities of a series. A meeting will be permitted to be
called at any time by the Trustee, and also, upon request, by the Company or
the Holders of at least 10% in principal amount of the Outstanding Debt
Securities of the series, in any case upon notice given as provided in the
Indenture. Except for any consent that must be given by the Holder of each
Debt Security affected by certain modifications and amendments of the
Indenture, any resolution presented at a meeting or adjourned meeting duly
reconvened at which a quorum is present will be permitted to be adopted by the
affirmative vote of the Holders of a majority in principal amount of the
Outstanding Debt Securities of that series; PROVIDED, HOWEVER, that, except as
referred to above, any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other action that may be
made, given or taken by the Holders of a specified percentage, which is less
than a majority, in principal amount of the Outstanding Debt Securities of a
series may be adopted at a meeting or adjourned meeting duly reconvened at
which a quorum is present by the affirmative vote of the Holders of the
specified percentage in principal amount of the Outstanding Debt Securities of
that series. Any resolution passed or decision taken at any meeting of Holders
of Debt Securities of any series duly held in accordance with the Indenture
will be binding on all Holders of Debt Securities of that series. The quorum
at any meeting called to adopt a resolution, and at any reconvened meeting,
will be Persons holding or representing a majority in principal amount of the
Outstanding Debt Securities of a series; PROVIDED, HOWEVER, that if any action
is to be taken at the meeting with respect to a consent or waiver which may be
given by the Holders of not less than a specified percentage in principal
amount of the Outstanding Debt Securities of a series, the Persons holding or
representing the specified percentage in principal amount of the Outstanding
Debt Securities of the series will constitute a quorum.
Notwithstanding the foregoing provisions, any action to be taken at a
meeting of Holders of Debt Securities of any series with respect to any action
that the Indenture expressly provides may be taken by the Holders of a
specified percentage which is less than a majority in principal amount of the
Outstanding Debt Securities of a series may be taken at a meeting at which a
quorum is present by the affirmative vote of Holders of the specified
percentage in principal amount of the Outstanding Debt Securities of the
series.
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
The Company may discharge certain obligations to Holders of any
series of Debt Securities that have not already been delivered to the Trustee
for cancellation and that either have become due and payable or will become
due and payable within one year (or scheduled for redemption within one year)
by irrevocably depositing with the Trustee, in trust, funds in the currency or
currencies, currency unit or units or composite currency or currencies in
which the Debt Securities are payable in an amount sufficient to pay the
entire indebtedness on the Debt Securities in respect of principal (and
premium, if any) and interest to the date of the deposit (if the Debt
Securities have become due and payable) or to the Stated Maturity or
Redemption Date, as the case may be.
The Indenture provides that, unless these provisions are made
inapplicable to the Debt Securities of or within any series pursuant to the
Indenture, the Company may elect either (a) to defease and discharge itself
from any and all obligations with respect to the Debt Securities (except for
the obligation to pay additional amounts, if any, upon the occurrence of
certain events of tax, assessment or governmental charge with respect to
payments on the Debt Securities and the obligations to register the transfer
or exchange of Debt Securities, to replace temporary or mutilated, destroyed,
lost or stolen Debt Securities, to maintain an office or agency in respect of
the Debt Securities and to hold moneys for payment in trust) ("defeasance") or
(b) to release itself from their obligations with respect to the Debt
Securities under certain sections of the Indenture and, if provided pursuant
to the Indenture, their obligations with respect to any other covenant, and
any omission to comply with the obligations shall not constitute a default or
an Event of Default with respect to the Debt Securities ("covenant
defeasance"), in either case upon the irrevocable deposit by the Company with
the Trustee, in trust, of an amount, in the currency or currencies, currency
unit or units or composite currency or currencies in which the Debt Securities
are payable at Stated Maturity, or Government Obligations (as defined below),
or both, applicable to the Debt Securities which through the scheduled payment
of principal and interest in accordance with their terms will provide money in
an amount sufficient to pay the principal of (and premium, if any) and
interest on the Debt Securities, and any mandatory sinking fund or analogous
payments thereon, on the scheduled due dates therefor.
A trust will only be permitted to be established if, among other
things, the Company has delivered to the Trustee an Opinion of Counsel (as
specified in the Indenture) to the effect that the Holders of the Debt
Securities will not recognize income, gain or loss for U.S. federal income tax
purposes as a result of the defeasance or covenant defeasance and will be
subject to U.S. federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if the defeasance or covenant
defeasance had not occurred, and the Opinion of Counsel, in the case of
defeasance, must refer to and be based upon a ruling of the Internal Revenue
Service or a change in applicable United States federal income tax law.
"Government Obligations" means securities which are (1) direct
obligations of the United States of America or the government which issued the
foreign currency in which the Debt Securities of a particular series are
payable, for the payment of which its full faith and credit is pledged or (2)
obligations of a person controlled or supervised by and acting as an agency or
instrumentality of the United States of America or the government which issued
the foreign currency in which the Debt Securities of the series are payable,
the payment of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America or other government, which, in
either case, are not callable or redeemable at the option of the issuer
thereof, and shall also include a depository receipt issued by a bank or trust
company as custodian with respect to any Government Obligation or a specific
payment of interest on or principal of any Government Obligation held by the
custodian for the account of the holder of a depository receipt, PROVIDED that
(except as required by law) the custodian is not authorized to make any
deduction from the amount payable to the holder of the depository receipt from
any amount received by the custodian in respect of the Government Obligation
or the specific payment of interest on or principal of the Government
Obligation evidenced by the depository receipt.
Unless otherwise provided in the applicable prospectus supplement, if
after the Company has deposited funds and/or Government Obligations to effect
defeasance or covenant defeasance with respect to Debt Securities of any
series:
(a) the Holder of a Debt Security of the series is entitled to, and
does, elect pursuant to the Indenture or the terms of the Debt Security to
receive payment in a currency, currency unit or composite currency other than
that in which the deposit has been made in respect of the Debt Security, or
(b) a Conversion Event (as defined below) occurs in respect of the
currency, currency unit or composite currency in which the deposit has been
made, the indebtedness represented by the Debt Security shall be deemed to
have been, and will be, fully discharged and satisfied through the payment of
the principal of (and premium, if any) and interest on the Debt Security as
they become due out of the proceeds yielded by converting the amount so
deposited in respect of the Debt Security into the currency, currency unit or
composite currency in which the Debt Security becomes payable as a result of
the election or the Conversion Event based on the applicable market exchange
rate.
"Conversion Event" means the cessation of use of:
o a currency, currency unit or composite currency both by the
government of the country which issued the currency and for the
settlement of transactions by a central bank or other public
institutions of or within the international banking community or
o the euro both within the European Monetary System and for the
settlement of transactions by public institutions of or within
the European Community.
Unless otherwise provided in the applicable prospectus supplement,
all payments of principal of (and premium, if any) and interest on any Debt
Security that is payable in a foreign currency that ceases to be used by its
government of issuance shall be made in U.S. dollars.
In the event the Company effects covenant defeasance with respect to
any Debt Securities and the Debt Securities are declared due and payable
because of the occurrence of any Event of Default other than the Event of
Default described in clause (d) under "Event of Default, Notice and Waiver"
with respect to sections no longer applicable to the Debt Securities or
described in clause (g) under "Events of Default, Notice and Waiver" with
respect to any other covenant as to which there has been covenant defeasance,
the amount in the currency, currency unit or composite currency in which the
Debt Securities are payable, and Government Obligations on deposit with the
Trustee, will be sufficient to pay amounts due on the Debt Securities at the
time of their Stated Maturity but may not be sufficient to pay amounts due on
the Debt Securities at the time of the acceleration resulting from the Event
of Default. However, the Company would remain liable to make payment of the
amounts due at the time of acceleration.
<PAGE>
GOVERNING LAW
The Indenture and the Notes shall be governed by the laws of the
State of New York.
CONVERSION RIGHTS
The terms and conditions, if any, upon which any Debt Securities are
convertible into debt securities or equity securities of the Company will be
set forth in the applicable prospectus supplement. The terms will include the
number or principal amount of securities into which the debt securities are
convertible, the conversion price (or manner of calculation thereof), the
conversion period, provisions as to whether conversion will be at the option
of the holders of the debt securities, or the Company, the events requiring an
adjustment of the conversion price (or the manner of calculation thereof) and
any provisions affecting conversion in the event of the redemption of the debt
securities.
GLOBAL SECURITIES
The Debt Securities of a series may be issued in whole or in part in
the form of one or more global securities (the "Global Securities") that will
be deposited with, or on behalf of, a depositary (the "Depositary") identified
in the applicable prospectus supplement relating to the series. Global
Securities may be issued in either registered or bearer form and in either
temporary or permanent form. The specific terms of the depositary arrangement
with respect to a series of Debt Securities will be described in the
applicable prospectus supplement relating to the series.
DESCRIPTION OF COMMON STOCK
GENERAL
Our charter (the "Charter") provides that we may issue up to 100
million shares of common stock, $.01 par value per share. On November 30,
1999, there were 28,201,372 shares of common stock outstanding.
All shares of common stock offered hereby have been duly authorized
and will be fully paid and nonassessable. Subject to the preferential rights
of any other shares or series of stock and to the provisions of the Charter
regarding Excess Stock (as defined under "Restrictions on Ownership of Capital
Stock"), holders of shares of common stock offered hereby will be entitled to
receive dividends on the stock if, as and when authorized and declared by the
Board of Directors of the Company out of assets legally available therefor and
to share ratably in the assets of the Company legally available for
distribution to its common stockholders in the event of its liquidation,
dissolution or winding up after payment of or adequate provision for all known
debts and liabilities of the Company. Under the terms of our credit agreements
with Reckson Operating Partnership, we are prohibited from paying any dividends
on shares of our capital stock as long as there are amounts outstanding under
the agreements.
Subject to the provisions of the Charter regarding Excess Stock, each
outstanding share of common stock, entitles the holder to one vote on all
matters submitted to a vote of stockholders, including the election of
directors, and, except as provided with respect to any other class or series
of stock, the holders of these shares will possess the exclusive voting power.
There is no cumulative voting in the election of directors, which means that
the holders of a majority of the outstanding shares of the Company's existing
common stock can elect all of the directors then standing for election and the
holders of the remaining shares will not be able to elect any directors.
Holders of shares of common stock have no preference, conversion,
exchange, sinking fund, redemption or appraisal rights and have no preemptive
rights to subscribe for any other securities. Subject to the provisions of the
Charter regarding Excess Stock, shares of common stock will have equal
dividend, liquidation and other rights.
CERTAIN PROVISIONS OF THE CHARTER
The Board of Directors is divided into three classes of directors,
each class constituting approximately one-third of the total number of
directors, with the classes serving staggered terms. At each annual meeting of
stockholders, the class of directors to be elected at the meeting will be
elected for a three-year term and the directors in the other two classes will
continue in office. We believe that classified directors will help to assure
the continuity and stability of the Board of Directors and our business
strategies and policies as determined by the Board. The use of a staggered
board may delay or defer a change in control or removal of incumbent
management.
Our charter and bylaws contain additional provisions that may deter
third party acquisition proposals. Prospective investors should review the
section captioned "Risk Factors -- Certain Anti-takeover provisions may deter
third party acquisition proposals."
RESTRICTIONS ON OWNERSHIP
In order for Reckson Associates to qualify as a REIT under the Code,
it must satisfy a variety of requirements, including annual tests with respect
to the nature of its gross income. Substantially all of Reckson Associates'
gross income meets these requirements by qualifying as "rentals from real
property" under Section 856(d) of the Code. Under this provision, however, a
REIT's real property rentals can be disqualified if the rent is received by
the REIT from a related party or if noncustomary services are performed for
the tenant other than by an independent contractor. The characterization of a
party as a related-party tenant or as an independent contractor depends, in
part, upon the percentage of stock, assets or net profits of such party that
may be owned by the REIT or by stockholders of the REIT. Such ownership may be
direct or may be indirect under certain attribution rules prescribed by the
Code. Currently, there is a substantial identity of ownership between
stockholders of Reckson Associates and stockholders of the Company. It cannot
be predicted how long or to what degree such identity of ownership may
continue. Therefore, in order to protect Reckson Associates from the risk that
rental income it earns from the Company or its affiliates, or from tenants
that the Company or its affiliates provides commercial services to, will not
be disqualified as rent from real property for REIT qualification purposes,
subject to certain exceptions, the ownership by any person or entity of the
Company's common stock is limited to 9.9% of the aggregate number or value of
shares of the Company's common stock outstanding and the ownership by any
person of the Company's capital stock is limited to 9.9% of the aggregate
value of all classes of capital stock outstanding.
RESTRICTIONS ON ABILITY TO PAY DIVIDENDS
As long as there are outstanding advances under the Reckson Service
Industries Facility or borrowings by us under the credit agreement with
respect to the Reckson Strategic Venture Partners Commitment, we are
prohibited from paying dividends on any shares of our capital stock or
incurring debt. See the section captioned "Risk Factors - Conflicts in our
loans with Reckson Operating Partnership; limitation on our ability to pay
dividends and incur additional debt" above.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the common stock is American
Stock Transfer & Trust Company.
DESCRIPTION OF PREFERRED STOCK
GENERAL
Our Charter provides that we may issue up to 25 million shares of
preferred stock, $.01 par value per share. As of November 30, 1999, there were
no shares of preferred stock outstanding.
The issuance of preferred stock could adversely affect the voting
power, dividend rights and other rights of holders of common stock. Although
the Board of Directors has no intention at the present time, it could
establish a series of preferred stock that could, depending on the terms of
the series, delay, defer or prevent a transaction or a change in control of
the Company that might involve a premium price for the common stock or
otherwise be in the best interest of the holders thereof. Management believes
that the availability of preferred stock will provide us with increased
flexibility in structuring possible future financing and acquisitions and in
meeting other needs that might arise.
TERMS
Subject to the limitations prescribed by the Charter, the Board of
Directors is authorized to fix the number of shares constituting each series
of preferred stock and the designations and powers, preferences and relative,
participating, optional or other special rights and qualifications,
limitations or restrictions thereof, including the provisions as may be
desired concerning voting, redemption, dividends, dissolution or the
distribution of assets, conversion, and other subjects or matters as may be
fixed by resolution of the Board of Directors. The preferred stock will, when
issued, be fully paid and nonassessable and will have no preemptive rights.
Reference is made to the prospectus supplement relating to the series
of preferred stock offered thereby for the specific terms thereof, including:
o The title and stated value of the preferred stock;
o The number of shares of the preferred stock, the liquidation
preference per share of the preferred stock and the offering
price of the preferred stock;
o The dividend rate(s), period(s) and/or payment date(s) or
method(s) of calculation thereof applicable to the preferred
stock;
o The date from which dividends on the preferred stock shall
accumulate, if applicable;
o The procedures for any auction and remarketing, if any, for the
preferred stock;
o The provision for a sinking fund, if any, for the preferred
stock;
o The provisions for redemption, if applicable, of the preferred
stock;
o Any listing of the preferred stock on any securities exchange;
o The terms and conditions, if applicable, upon which the
preferred stock may or will be convertible into our common stock
or debt securities, including the conversion price or manner of
calculation thereof;
o The relative ranking and preferences of the preferred stock as
to dividend rights and rights upon liquidation, dissolution or
winding up of the affairs of the Company;
o Any limitations on direct or beneficial ownership and
restrictions on transfer, in each case as may be appropriate to
preserve the status of Reckson Associates as a REIT;
o A discussion of material federal income tax considerations
applicable to the preferred stock; and
o Any other specific terms, preferences, rights, limitations or
restrictions of the preferred stock.
RANK
Unless otherwise specified in the applicable prospectus supplement,
the preferred stock will, with respect to dividend rights and rights upon
liquidation, dissolution or winding up of the Company, rank:
i. senior to the common stock and to all classes or series of
equity securities issued by the Company, the terms of which
provide that the equity securities shall rank junior to the
preferred stock;
ii. on a parity with all classes or series of equity securities
issued by the Company, other than those referred to in clauses
(i) and (iii); and
iii. junior to all classes or series of equity securities issued by
the Company which the terms of the preferred stock provide will
rank senior to it. The term "equity securities" does not include
convertible debt securities.
DIVIDENDS
Unless otherwise specified in the applicable prospectus supplement,
the preferred stock will have the rights with respect to payment of dividends
set forth below.
Holders of the preferred stock of each series will be entitled to
receive, when, as and if declared by the Board of Directors of the Company,
out of assets of the Company legally available for payment, cash dividends in
the amounts and on the dates as will be set forth in, or pursuant to, the
applicable prospectus supplement. Each dividend shall be payable to holders of
record as they appear on the stock transfer books of the Company on the record
dates as shall be fixed by the Board of Directors of the Company.
Dividends on any series of preferred stock may be cumulative or
non-cumulative, as provided in the applicable prospectus supplement.
Dividends, if cumulative, will be cumulative from and after the date set forth
in the applicable prospectus supplement. If the Board of Directors of the
Company fails to declare a dividend payable on a dividend payment date on any
series of preferred stock for which dividends are non-cumulative, then the
holders of the series of preferred stock will have no right to receive a
dividend in respect of the related dividend period and the Company will have
no obligation to pay the dividend accrued for the period, whether or not
dividends on the series of preferred stock are declared payable on any future
dividend payment date.
If preferred stock of any series is outstanding, no full dividends
will be declared or paid or set apart for payment on any of the capital stock
of the Company of any other series ranking, as to dividends, on a parity with
or junior to the preferred stock of the series for any period unless:
o if the series of preferred stock has a cumulative dividend, full
cumulative dividends have been or contemporaneously are declared
and paid or declared and a sum sufficient for the payment
thereof set apart for the payment for all past dividend periods
and the then current dividend period or
o if the series of preferred stock does not have a cumulative
dividend, full dividends for the then current dividend period
have been or contemporaneously are declared and paid or declared
and a sum sufficient for the payment thereof set apart for the
payment on the preferred stock of the series.
When dividends are not paid in full (or a sum sufficient for the full
payment is not so set apart) upon preferred stock of any series and the shares
of any other series of preferred stock ranking on a parity as to dividends
with the preferred stock of the series, all dividends declared upon preferred
stock of the series and any other series of preferred stock ranking on a
parity as to dividends with the preferred stock shall be declared pro rata so
that the amount of dividends declared per share of preferred stock of the
series and the other series of preferred stock shall in all cases bear to each
other the same ratio that accrued dividends per share on the preferred stock
of the series and the other series of preferred stock (which shall not include
any accumulation in respect of unpaid dividends for prior dividend periods if
the preferred stock does not have a cumulative dividend) bear to each other.
No interest, or sum of money in lieu of interest, shall be payable in respect
of any dividend payment or payments on preferred stock of the series which may
be in arrears.
Except as provided in the immediately preceding paragraph, unless (1)
if the series of preferred stock has a cumulative dividend, full cumulative
dividends on the preferred stock of the series have been or contemporaneously
are declared and paid or declared and a sum sufficient for the payment thereof
set apart for payment for all past dividend periods and the then current
dividend period, and (2) if the series of preferred stock does not have a
cumulative dividend, full dividends on the preferred stock of the series have
been or contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof set apart for payment for the then current
dividend period, no dividends (other than in shares of common stock or other
capital stock ranking junior to the preferred stock of the series as to
dividends and upon liquidation) shall be declared or paid or set aside for
payment or other distribution shall be declared or made upon the common stock,
or any other of the capital stock of the Company ranking junior to or on a
parity with the preferred stock of the series as to dividends or upon
liquidation, nor shall any shares of common stock, or any other capital stock
of the Company ranking junior to or on a parity with the preferred stock of
the series as to dividends or upon liquidation, be redeemed, purchased or
otherwise acquired for any consideration (or any moneys be paid to or made
available for a sinking fund for the redemption of any shares) by the Company
except:
(1) by conversion into or exchange for other capital stock of the
Company ranking junior to the preferred stock of the series as to dividends
and upon liquidation; or
(2) redemptions for the purpose of preserving the status of Reckson
Associates as a REIT.
Under the terms of our credit agreements with Reckson Operating
Partnership, we are prohibited from paying any dividends on shares of our
capital stock as long as there are amounts outstanding under the agreements.
REDEMPTION
If so provided in the applicable prospectus supplement, the preferred
stock will be subject to mandatory redemption or redemption at the option of
the Company, as a whole or in part, in each case upon the terms, at the times
and at the redemption prices set forth in the prospectus supplement.
The prospectus supplement relating to a series of preferred stock
that is subject to mandatory redemption will specify the number of shares of
the preferred stock that the Company will redeem in each year commencing after
a date to be specified, at a redemption price per share to be specified,
together with an amount equal to all accumulated and unpaid dividends thereon
(which shall not, if the preferred stock does not have a cumulative dividend,
include any accumulation in respect of unpaid dividends for prior dividend
periods) to the date of redemption. The redemption price may be payable in
cash or other property, as specified in the applicable prospectus supplement.
If the redemption price for preferred stock of any series is payable only from
the net proceeds of the issuance of capital stock of the Company, the terms of
the preferred stock may provide that, if no capital stock shall have been
issued or to the extent the net proceeds from any issuance are insufficient to
pay in full the aggregate redemption price then due, the preferred stock shall
automatically and mandatorily be converted into the applicable capital stock
of the Company pursuant to conversion provisions specified in the applicable
prospectus supplement.
Notwithstanding the foregoing, unless (1) if the series of preferred
stock has a cumulative dividend, full cumulative dividends on all shares of
any series of preferred stock shall have been or contemporaneously are
declared and paid or declared and a sum sufficient for the payment thereof set
apart for payment for all past dividend periods and the then current dividend
period, and (2) if the series of preferred stock does not have a cumulative
dividend, full dividends on the preferred stock of any series have been or
contemporaneously are declared and paid or declared and a sum sufficient for
the payment thereof set apart for payment for the then current dividend
period, no shares of any series of preferred stock shall be redeemed unless
all outstanding preferred stock of the series is simultaneously redeemed;
PROVIDED, HOWEVER, that the foregoing shall not prevent the purchase or
acquisition of preferred stock of the series to preserve the status of Reckson
Associates as a REIT or pursuant to a purchase or exchange offer made on the
same terms to holders of all outstanding preferred stock of the series. In
addition, unless (1) if the series of preferred stock has a cumulative
dividend, full cumulative dividends on all outstanding shares of any series of
preferred stock have been or contemporaneously are declared and paid or
declared and a sum sufficient for the payment thereof set apart for payment
for all past dividend periods and the then current dividend period, and (2) if
the series of preferred stock does not have a cumulative dividend, full
dividends on the preferred stock of any series have been or contemporaneously
are declared and paid or declared and a sum sufficient for the payment thereof
set apart for payment for the then current dividend period, the Company shall
not purchase or otherwise acquire, directly or indirectly, any shares of
preferred stock of the series (except by conversion into or exchange for
capital stock of the Company ranking junior to the preferred stock of the
series as to dividends and upon liquidation); PROVIDED, HOWEVER, that the
foregoing shall not prevent the purchase or acquisition of preferred stock of
the series to preserve the status of Reckson Associates as a REIT or pursuant
to a purchase or exchange offer made on the same terms to holders of all
outstanding preferred stock of the series.
If fewer than all of the outstanding shares of preferred stock of any
series are to be redeemed, the number of shares to be redeemed will be
determined by the Company and the shares may be redeemed pro rata from the
holders of record of the shares in proportion to the number of the shares held
or for which redemption is requested by the holder (with adjustments to avoid
redemption of fractional shares) or by lot or in any other reasonable manner.
Notice of redemption will be mailed at least 30 days but not more
than 60 days before the redemption date to each holder of record of preferred
stock of any series to be redeemed at the address shown on the stock transfer
books. Each notice shall state:
o the redemption date;
o the number of shares and series of the preferred stock to be
redeemed;
o the redemption price;
o the place or places where certificates for the preferred stock
are to be surrendered for payment of the redemption price;
o that dividends on the shares to be redeemed will cease to
accumulate on the redemption date; and
o the date upon which the holder's conversion rights, if any, as
to the shares shall terminate.
If fewer than all the shares of preferred stock of any series are to
be redeemed, the notice mailed to each holder thereof shall also specify the
number of shares of preferred stock to be redeemed from each holder. If notice
of redemption of any preferred stock has been given and if the funds necessary
for redemption have been set aside by the Company in trust for the benefit of
the holders of any preferred stock so called for redemption, then from and
after the redemption date dividends will cease to accumulate on the preferred
stock, and all rights of the holders of the preferred stock will terminate,
except the right to receive the redemption price.
LIQUIDATION PREFERENCE
Upon any voluntary or involuntary liquidation, dissolution or winding
up of the affairs of the Company (referred to herein as a "liquidation"),
then, before any distribution or payment shall be made to the holders of any
common stock or any other class or series of capital stock of the Company
ranking junior to the preferred stock of the series in the distribution of
assets upon any liquidation, dissolution or winding up of the Company, the
holders of the preferred stock shall be entitled to receive out of assets of
the Company legally available for distribution to shareholders liquidating
distributions in the amount of the liquidation preference per share (set forth
in the applicable prospectus supplement), plus an amount equal to all
dividends accumulated and unpaid thereon (which shall not include any
accumulation in respect of unpaid dividends for prior dividend periods if the
preferred stock does not have a cumulative dividend). After payment of the
full amount of the liquidating distributions to which they are entitled, the
holders of preferred stock will have no rights or claim to any remaining
assets. In the event that, upon any voluntary or involuntary liquidation,
dissolution or winding up, the available assets of the Company are
insufficient to pay the amount of the liquidating distributions on all
outstanding preferred stock of the series and the corresponding amounts
payable on all shares of other classes or series of capital stock of the
Company ranking on a parity with the preferred stock in the distribution of
assets, then the holders of the preferred stock and all other classes or
series of capital stock shall share ratably in any distribution of assets in
proportion to the full liquidating distributions to which they would otherwise
be respectively entitled.
The consolidation or merger of the Company with or into any other
entity, or the merger of another entity with or into the Company, or a
statutory share exchange by the Company, or the sale, lease or conveyance of
all or substantially all of the property or business of the Company, shall not
be deemed to constitute a liquidation, dissolution or winding up of the
Company.
VOTING RIGHTS
Holders of the preferred stock will not have any voting rights,
except as set forth below or as otherwise from time to time required by law or
as indicated in the applicable prospectus supplement.
Whenever dividends on any series of preferred stock shall be in
arrears for six or more quarterly periods, the holders of the preferred stock
(voting separately as a class with all other series of preferred stock upon
which like voting rights have been conferred and are exercisable) will be
entitled to vote for the election of two additional directors of the Company
at a special meeting called by the holders of record of at least ten percent
(10%) of any series of preferred stock so in arrears, unless the request is
received less than 90 days before the date fixed for the next annual or
special meeting of the stockholders, or at the next annual meeting of
stockholders, and at each subsequent annual meeting until (i) if the series of
preferred stock has a cumulative dividend, all dividends accumulated on the
shares of preferred stock for the past dividend periods and the then current
dividend period shall have been fully paid or declared and a sum sufficient
for the payment thereof set aside for payment or (ii) if the series of
preferred stock does not have a cumulative dividend, four quarterly dividends
shall have been fully paid or declared and a sum sufficient for the payment
thereof set aside for payment. In these cases, the entire Board of Directors
of the Company will be increased by two directors.
Unless provided otherwise for any series of preferred stock, so long
as any shares of the preferred stock remain outstanding, the Company will not,
without the affirmative vote or consent of the holders of at least two-thirds
of the shares of the series of preferred stock outstanding at the time, given
in person or by proxy, either in writing or at a meeting (the series voting
separately as a class):
(1) authorize or create, or increase the authorized or issued amount
of, any class or series of capital stock ranking senior to the preferred stock
with respect to payment of dividends or the distribution of assets upon
liquidation, dissolution or winding up of the Company, or reclassify any
authorized capital stock of the Company into preferred stock, or create,
authorize or issue any obligation or security convertible into or evidencing
the right to purchase any stock; or
(2) amend, alter or repeal the provisions of the Charter or the
Designating Amendment for the series of preferred stock, whether by merger,
consolidation or otherwise (an "Event"), so as to materially and adversely
affect any right, preference, privilege or voting power of the series of
preferred stock or the holders thereof;
PROVIDED, HOWEVER, with respect to the occurrence of any of the
Events set forth in (2) above, so long as the series of preferred stock
remains outstanding with the terms thereof materially unchanged, taking into
account that upon the occurrence of an Event the Company may not be the
surviving entity, the occurrence of any Event shall not be deemed to
materially and adversely affect the rights, preferences, privileges or voting
powers of holders of the series of preferred stock; and PROVIDED, FURTHER,
that (x) any increase in the amount of the authorized preferred stock or the
creation or issuance of any other series of preferred stock, or (y) any
increase in the amount of authorized shares of the series of preferred stock
or any other series of preferred stock, in each case ranking on a parity with
or junior to the preferred stock of the series with respect to payment of
dividends or the distribution of assets upon liquidation, dissolution or
winding up of the Company, shall not be deemed to materially and adversely
affect the rights, preferences, privileges or voting powers.
The foregoing voting provisions will not apply if, at or prior to the
time when the act with respect to which the vote or consent would otherwise be
required shall be effected, all outstanding shares of the series of preferred
stock shall have been converted, redeemed or called for redemption and
sufficient funds shall have been deposited in trust to effect the redemption.
CONVERSION RIGHTS
The terms and conditions, if any, upon which any series of preferred
stock is convertible into shares of common stock or debt securities of the
Company will be set forth in the applicable prospectus supplement. The terms
will include the number of shares of common stock or aggregate principal
amount of debt securities, as the case may be, into which the shares of
preferred stock are convertible, the conversion price (or manner of
calculation thereof), the conversion period, provisions as to whether
conversion will be at the option of the holders of the preferred stock of the
Company, the events requiring an adjustment of the conversion price and
provisions affecting conversion in the event of the redemption of the
preferred stock.
SHAREHOLDER LIABILITY
Delaware law provides that no shareholder, including holders of
preferred stock, shall be personally liable for the acts and obligations of
the Company and that the funds and property of the Company shall be the only
recourse for these acts or obligations.
RESTRICTIONS ON OWNERSHIP
As discussed below under "Restrictions on Ownership of Capital
Stock," in order to ensure Reckson Associates' status as a REIT under the
Code, our charter provides generally that no stockholder may own more than
9.9% of the aggregate number or value of our outstanding shares of common
stock, or more than 9.9% of the aggregate value of the outstanding shares of
all classes of our capital stock. In connection with the issuance of a series
of preferred stock the Designating Amendment for such series may contain
additional provisions restricting the ownership and transfer of the preferred
stock. The applicable prospectus supplement will specify any additional
ownership limitation relating to a series of preferred stock.
REGISTRAR AND TRANSFER AGENT
Unless otherwise specified in the applicable prospectus supplement,
the Registrar and Transfer Agent for the preferred stock will be American
Stock Transfer & Trust Company.
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
The Company may issue receipts ("Depositary Receipts") for Depositary
Shares, each of which will represent a fractional interest or a share of a
particular series of a class of preferred stock, as specified in the
applicable prospectus supplement. Preferred stock of each series of each class
represented by Depositary Shares will be deposited under a separate Deposit
Agreement (each, a "Deposit Agreement") among the Company, the depositary
named therein (the depositary or its successor, the "Preferred Stock
Depositary") and the holders from time to time of the Depositary Receipts.
Subject to the terms of the Deposit Agreement, each owner of a Depositary
Receipt will be entitled, in proportion to the fractional interest of a share
of the particular series of a class of preferred stock represented by the
Depositary Shares evidenced by the Depositary Receipt, to all the rights and
preferences of the preferred stock represented by the Depositary Shares,
including dividend, voting, conversion, redemption and liquidation rights.
The Depositary Shares will be evidenced by Depositary Receipts issued
pursuant to the applicable Deposit Agreement. Immediately following the
issuance and delivery of the preferred stock by the Company to the Preferred
Stock Depositary, the Company will cause the Preferred Stock Depositary to
issue, on our behalf, the Depositary Receipts. Copies of the applicable form
of Deposit Agreement and Depositary Receipt may be obtained from the Company
upon request.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Preferred Stock Depositary will distribute all cash dividends or
other cash distributions received in respect of the preferred stock to the
record holders of the Depositary Receipts evidencing the related Depositary
Shares in proportion to the number of the Depositary Receipts owned by the
holder, subject to certain obligations of holders to file proofs, certificates
and other information and to pay certain charges and expenses to the Preferred
Stock Depositary.
In the event of a distribution other than in cash, the Preferred
Stock Depositary will distribute property received by it to the record holders
of Depositary Receipts entitled thereto, subject to certain obligations of
holders to file proofs, certificates and other information and to pay certain
charges and expenses to the Preferred Stock Depositary, unless the Preferred
Stock Depositary determines that it is not feasible to make the distribution,
in which case the Preferred Stock Depositary may, with the approval of the
Company, sell the property and distribute the net proceeds from the sale to
holders.
Under the terms of our credit agreements with Reckson Operating
Partnership, we are prohibited from paying any dividends on shares of our
capital stock as long as there are amounts outstanding under the agreements.
WITHDRAWAL OF SHARES
Upon surrender of the Depositary Receipts at the corporate trust
office of the Preferred Stock Depositary (unless the related Depositary Shares
have previously been called for redemption), the holders thereof will be
entitled to delivery at the office, to or upon the holder's order, of the
number of whole or fractional shares of preferred stock and any money or other
property represented by the Depositary Shares evidenced by the Depositary
Receipts. Holders of Depositary Receipts will be entitled to receive whole or
fractional shares of the related preferred stock on the basis of the
proportion of preferred stock represented by each Depositary Share as
specified in the applicable prospectus supplement, but holders of the
preferred stock will not thereafter be entitled to receive 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 shares of preferred stock to be withdrawn, the Preferred Stock
Depositary will deliver to the holder at the same time a new Depositary
Receipt evidencing the excess number of Depositary Shares.
REDEMPTION OF DEPOSITARY SHARES
Whenever the Company redeems preferred stock held by the Preferred
Stock Depositary, the Preferred Stock Depositary will redeem as of the same
redemption date the number of Depositary Shares representing the preferred
stock so redeemed, provided the Company shall have paid in full to the
Preferred Stock Depositary the redemption price of the preferred stock to be
redeemed plus an amount equal to any accrued and unpaid dividends thereon to
the date fixed for redemption. The redemption price per Depositary Share will
be equal to the redemption price and any other amounts per share payable with
respect to the preferred stock. If less than all the Depositary Shares are to
be redeemed, the Depositary Shares to be redeemed will be selected by the
Preferred Stock Depositary by lot.
After the date fixed for redemption, the Depositary Shares so called
for redemption will no longer be deemed to be outstanding and all rights of
the holders of the Depositary Receipts evidencing the Depositary Shares so
called for redemption will cease, except the right to receive any moneys
payable upon redemption and any money or other property to which the holders
of the Depositary Receipts were entitled upon redemption upon surrender
thereof to the Preferred Stock Depositary.
VOTING OF THE UNDERLYING PREFERRED SHARES
Upon receipt of notice of any meeting at which the holders of the
preferred stock are entitled to vote, the Preferred Stock Depositary will mail
the information contained in the notice of meeting to the record holders of
the Depositary Receipts evidencing the Depositary Shares which represent the
preferred stock. Each record holder of Depositary Receipts evidencing
Depositary Shares on the record date (which will be the same date as the
record date for the preferred stock) will be entitled to instruct the
Preferred Stock Depositary as to the exercise of the voting rights pertaining
to the amount of preferred stock represented by the holder's Depositary
Shares. The Preferred Stock Depositary will vote the amount of preferred stock
represented by the Depositary Shares in accordance with the instructions, and
we will agree to take all reasonable action which may be deemed necessary by
the Preferred Stock Depositary in order to enable the Preferred Stock
Depositary to do so. The Preferred Stock Depositary will abstain from voting
the amount of preferred stock represented by the Depositary Shares to the
extent it does not receive specific instructions from the holders of
Depositary Receipts evidencing the Depositary Shares.
LIQUIDATION PREFERENCE
In the event of liquidation, dissolution or winding up of the
Company, whether voluntary or involuntary, each holder of a Depositary Receipt
will be entitled to the fraction of the liquidation preference accorded each
share of preferred stock represented by the Depositary Share evidenced by the
Depositary Receipt, as set forth in the applicable prospectus supplement.
CONVERSION OF PREFERRED SHARES
The Depositary Shares, as such, are not convertible into common stock
or any other securities or property of the Company. Nevertheless, if so
specified in the applicable prospectus supplement relating to an offering of
Depositary Shares, the Depositary Receipts may be surrendered by holders
thereof to the Preferred Stock Depositary with written instructions to the
Preferred Stock Depositary to instruct the Company to cause conversion of the
preferred stock represented by the Depositary Shares evidenced by Depositary
Receipts into whole shares of common stock, other preferred stock of the
Company or other shares of capital stock of the Company, and the Company has
agreed that upon receipt of instructions and any amounts payable in respect
thereof, it will cause the conversion thereof utilizing the same procedures as
those provided for delivery of preferred stock to effect the conversion. If
the Depositary Shares evidenced by a Depositary Receipt are to be converted in
part only, one or more new Depositary Receipts will be issued for any
Depositary Shares not to be converted. No fractional shares of common stock
will be issued upon conversion, and if the conversion will result in a
fractional share being issued, an amount will be paid in cash by the Company
equal to the value of the fractional interest based upon the closing price of
the common stock on the last business day prior to the conversion.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares which
represent the preferred stock and any provision of the Deposit Agreement may
at any time be amended by agreement between the Company and the Preferred
Stock Depositary. However, any amendment that materially and adversely alters
the rights of the holders of Depositary Receipts will not be effective unless
the amendment has been approved by the existing holders of at least a majority
of the Depositary Shares evidenced by the Depositary Receipts then
outstanding.
The Deposit Agreement may be terminated by the Company upon not less
than 30 days' prior written notice to the Preferred Stock Depositary if (1)
the termination is to preserve the status of Reckson Associates as a REIT or
(2) a majority of each class of preferred stock affected by the termination
consents to the termination, whereupon the Preferred Stock Depositary shall
deliver or make available to each holder of Depositary Receipts, upon
surrender of the Depositary Receipts held by the holder, the number of whole
or fractional shares of preferred stock as are represented by the Depositary
Shares evidenced by Depositary Receipts. In addition, the Deposit Agreement
will automatically terminate if (1) all outstanding Depositary Shares shall
have been redeemed, (2) there shall have been a final distribution in respect
of the related preferred stock in connection with any liquidation, dissolution
or winding up of the Company and the distribution shall have been distributed
to the holders of Depositary Receipts evidencing the Depositary Shares
representing the preferred stock or (iii) each related share of preferred
stock shall have been converted into capital stock of the Company not so
represented by Depositary Shares.
CHARGES OF PREFERRED SHARES DEPOSITARY
The Company will pay all transfer and other taxes and governmental
charges arising solely from the existence of the Deposit Agreement. In
addition, the Company will pay the fees and expenses of the Preferred Stock
Depositary in connection with the performance of its duties under the Deposit
Agreement. However, holders of Depositary Receipts will pay the fees and
expenses of the Preferred Stock Depositary for any duties requested by the
holders to be performed which are outside of those expressly provided for in
the Deposit Agreement.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Preferred Stock Depositary may resign at any time by delivering
to the Company notice of its election to do so, and the Company may at any
time remove the Preferred Stock Depositary, any resignation or removal to take
effect upon the appointment of a successor Preferred Stock Depositary. A
successor Preferred Shares 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
The Preferred Stock Depositary will forward to holders of Depositary
Receipts any reports and communications from the Company which are received by
the Preferred Stock Depositary with respect to the related preferred stock.
Neither the Company nor the Preferred Stock Depositary will be liable
if the Preferred Stock Depositary is prevented from or delayed in, by law or
any circumstances beyond its control, performing its obligations under the
Deposit Agreement. The obligations of the Company and the Preferred Stock
Depositary under the Deposit Agreement will be limited to performing specified
duties thereunder in good faith and without negligence, gross negligence or
willful misconduct, and the Company and the Preferred Stock Depositary will
not be obligated to prosecute or defend any legal proceeding in respect of any
Depositary Receipts, Depositary Shares or preferred stock represented thereby
unless satisfactory indemnity is furnished. The Company and the Preferred
Stock Depositary may rely on written advice of counsel or accountants, or
information provided by persons presenting the preferred stock represented
thereby for deposit, holders of Depositary Receipts or other persons believed
to be competent to give information, and on documents believed to be genuine
and signed by a proper party.
If the Preferred Stock Depositary shall receive conflicting claims,
requests or instructions from any holders of Depositary Receipts, on the one
hand, and from the Company, on the other hand, the Preferred Stock Depositary
shall be entitled to act on claims, requests or instructions received from the
Company.
RESTRICTIONS ON OWNERSHIP OF CAPITAL STOCK
EXCESS STOCK
The Charter provides that the Company may issue up to 25 million
shares of excess stock, par value $.01 per share ("Excess Stock"). For a
description of Excess Stock, see "--Restrictions on Ownership" below.
RESTRICTIONS ON OWNERSHIP
As described above, in order to protect Reckson Associates against
the risk of failing to satisfy certain tax laws applicable to REITs, our
Charter provides that no stockholder may own, or be deemed to own by virtue of
the attribution provisions of the Code, more than 9.9% of the aggregate number
or value of the Company's outstanding shares of common stock or more than 9.9%
of the aggregate value of the outstanding shares of all classes of the
Company's capital stock (the "Ownership Limit"), provided that in no event
will a stockholder be limited in the amount of the Company's common stock
acquired in connection with awards or exercises of employee stock options. In
the event we issue preferred stock, we may, in the designating amendment, set
a limit on the ownership of such preferred stock. Any direct or indirect
ownership of shares of stock in excess of the Ownership Limit or that would
result in common ownership among 10% holders of the Company's common stock and
Reckson Associates' common stock, will be null and void, and the intended
transferee will acquire no rights to the shares of capital stock. The
foregoing restrictions on transferability and ownership will not apply if
Reckson Associates determines that it is no longer in its best interests to
attempt to qualify, or to continue to qualify, as a REIT. Under the terms of
the intercompany agreement, the Company's Board of Directors will have the
right to waive the Ownership Limit only if permission to do so is granted by
Reckson Associates, in Reckson Associates' sole discretion, and the Company's
Board of Directors otherwise decides that such action is the best interest of
the Company.
Shares of capital stock owned, or deemed to be owned, or transferred
to a stockholder in excess of the Ownership Limit will automatically be
converted into shares of Excess Stock that will be transferred, by operation
of law, to the trustee of a trust for the exclusive benefit of one or more
charitable organizations described in Section 170(b) (1) (A) and 170(c) of the
Code (the "Charitable Beneficiary"). The trustee of the trust will be deemed
to own the Excess Stock for the benefit of the Charitable Beneficiary on the
date of the violative transfer to the original transferee-stockholder. Any
dividend or distribution paid to the original transferee-stockholder of Excess
Stock prior to the discovery by the Company that capital stock has been
transferred in violation of the provisions of the Company's Charter will be
repaid to the trustee upon demand. Any dividend or distribution authorized and
declared but unpaid shall be rescinded as void AB INITIO with respect to the
original transferee-stockholder and will instead be paid to the trustee of the
trust for the benefit of the Charitable Beneficiary. Any vote cast by an
original transferee-stockholder of shares of capital stock constituting Excess
Stock prior to the discovery by the Company that shares of capital stock have
been transferred in violation of the Company's Certificate of Incorporation
shall be rescinded as void AB INITIO. While the Excess Stock is held in trust,
the original transferee-stockholder will be deemed to have given an
irrevocable proxy to the trustee to vote the capital stock for the benefit of
the Charitable Beneficiary. The trustee of the trust may transfer the interest
in the trust representing the Excess Stock to any person whose ownership of
the shares of capital stock converted into such Excess Stock would be
permitted under the Ownership Limit and the Aggregate Ownership Limit. If such
transfer is made, the interest of the Charitable Beneficiary will terminate
and the proceeds of the sale will be payable to the original
transferee-stockholder and to the Charitable Beneficiary as described herein.
The original transferee-stockholder will receive the lesser of (i) the price
paid by the original transferee-stockholder for the shares of capital stock
that were converted into Excess Stock or, if the original
transferee-stockholder did not give value for such shares (E.G., the stock was
received through a gift, devise or other transaction), the average closing
price for the class of shares from which such shares of capital stock were
converted for the ten trading days immediately preceding such sale or gift,
and (ii) the price received by the trustee from the sale or other disposition
of the Excess Stock held in trust. The trustee may reduce the amount payable
to the original transferee-stockholder by the amount of dividends and
distributions relating to the shares of Excess Stock which have been paid to
the original transferee-stockholder and are owed by the original
transferee-stockholder to the trustee. Any proceeds in excess of the amount
payable to the original transferee-stockholder will be paid by the trustee to
the Charitable Beneficiary. Any liquidation distributions relating to Excess
Stock will be distributed in the same manner as proceeds of a sale of Excess
Stock. If the foregoing transfer restrictions are determined to be void or
invalid by virtue of any legal decision, statute, rule or regulations, then
the original transferee-stockholder of any shares of Excess Stock may be
deemed, at the option of the Company, to have acted as an agent on behalf of
the Company in acquiring the shares of Excess Stock and to hold the shares of
Excess Stock on behalf of the Company.
In addition, the Company will have the right, for a period of 90 days
during the time any shares of Excess Stock are held in trust, to purchase all
or any portion of the shares of Excess Stock at the lesser of (i) the price
initially paid for such shares by the original transferee-stockholder, or if
the original transferee-stockholder did not give value for such shares (E.G.,
the shares were received through a gift, devise or other transaction), the
average closing price for the class of stock from which such shares of Excess
Stock were converted for the ten trading days immediately preceding such sale
or gift, and (ii) the average closing price for the class of stock from which
such shares of Excess Stock were converted for the ten trading days
immediately preceding the date the Company elects to purchase such shares. The
Company may reduce the amount payable to the original transferee-stockholder
by the amount of dividends and distributions relating to the shares of Excess
Stock which have been paid to the original transferee-stockholder and are
owned by the original transferee-stockholder to the trustee. The Company may
pay the amount of such reductions to the trustee for the benefit of the
Charitable Beneficiary. The 90-day period begins on the later date of which
notice is received of the violative transfer if the original
transferee-stockholder gives notice to the Company of the transfer or, if no
such notice is given, the date the Company's Board of Directors determines
that a violative transfer has been made.
All certificates representing shares of capital stock will bear a
legend referring to the restrictions described above.
Each stockholder will be required, upon demand by the Company, to
disclose to the Company in writing any information with respect to the direct,
indirect and constructive ownership of capital stock of the Company as Reckson
Associates deems necessary for Reckson Associates to determine its compliance
with the provisions of the Code applicable to REITs.
The Company is required to maintain in its Charter the foregoing
Ownership Limit, Excess Stock and stock ownership disclosure requirements
under the terms of the Intercompany Agreement.
The Ownership Limit may have the effect of delaying, deferring or
preventing a change in control of the Company.
DESCRIPTION OF WARRANTS
The Company may issue Warrants for the purchase of common stock or
preferred stock. Warrants to purchase common stock may include rights to
purchase common stock that the Company issues to its common stock holders as a
dividend. Warrants may be issued independently or together with any securities
and may be attached to or separate from the securities. Each series of
Warrants will be issued under a separate warrant agreement (each, a "Warrant
Agreement") to be entered into between the Company and a warrant agent
specified therein ("Warrant Agent"). The Warrant Agent will act solely for the
Company in connection with the Warrants of the series and will not assume any
obligation or relationship of agency or trust for or with any holders or
beneficial owners of Warrants.
The applicable prospectus supplement will describe the following
terms, where applicable, of the Warrants in respect of which this prospectus
is being delivered:
o the title of the Warrants;
o the aggregate number of the Warrants;
o whether separate consideration will be issued for the Warrants
and, if so, the price or prices at which the Warrants will be
issued;
o the currencies in which the price or prices of the Warrants may
be payable, if applicable;
o the designation, amount and terms of the Securities purchasable
upon exercise of the Warrants;
o the designation and terms of the other Securities, if any, with
which the Warrants are issued and the number of the Warrants
issued with each Security;
o if applicable, the date on and after which the Warrants and the
Securities purchasable upon exercise of the Warrants will be
separately transferable;
o the price or prices at which and currency or currencies in which
the Securities purchasable upon exercise of the Warrants may be
purchased;
o the date on which the right to exercise the Warrants shall
commence and the date on which the right shall expire;
o the minimum or maximum amount of the Warrants which may be
exercised at any one time;
o information with respect to book-entry procedures, if any;
o a discussion of material federal income tax considerations; and
o any other material terms of the Warrants, including terms,
procedures and limitations relating to the exchange and exercise
of the Warrants.
PLAN OF DISTRIBUTION
The Company may sell the securities to one or more underwriters for
public offering and sale by them or may sell the securities to investors
directly or through agents. Any underwriter or agent involved in the offer and
sale of the securities will be named in the applicable prospectus supplement.
Underwriters may offer and sell the securities at a fixed price or
prices, which may be changed, at prices related to the prevailing market
prices at the time of sale or at negotiated prices. The Company also may, from
time to time, authorize underwriters acting as their agents to offer and sell
the securities upon the terms and conditions as are set forth in the
applicable prospectus supplement. In connection with the sale of securities,
underwriters may be deemed to have received compensation from the Company in
the form of underwriting discounts or commissions and may also receive
commissions from purchasers of securities for whom they may act as agent.
Underwriters may sell securities to or through dealers, and dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act
as agent.
Direct sales to investors may be accomplished through subscription
offerings or through subscription rights distributed to our stockholders. In
connection with subscription offerings or the distribution of subscription
rights to stockholders, if all of the underlying offered securities are not
subscribed for, we may sell such unsubscribed offered securities to third
parties directly or through agents and, in addition, whether or not all of the
underlying offered securities are subscribed for, we may concurrently offer
additional offered securities to third parties directly (including third
parties that are affiliated with us) or through agents, which agents may be
affiliated with us. Any underwriter or agent involved in the offer and sale of
the offered securities will be named in the applicable prospectus supplement.
Any underwriting compensation paid by the Company to underwriters or
agents in connection with the offering of securities, and any discounts,
concessions for commissions allowed by underwriters to participating dealers,
will be set forth in the applicable prospectus supplement. Underwriters,
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, under the Securities Act.
Underwriters, dealers and agents may be entitled, under agreements entered
into with the Company, to indemnification against and contribution toward
certain civil liabilities, including liabilities under the Securities Act.
Certain of the underwriters and their affiliates may be customers of,
engage in transactions with, and perform services for, the Company and its
subsidiaries in the ordinary course of business.
LEGAL MATTERS
The validity of the issuance of the securities offered hereby and
certain legal matters will be passed upon for the Company by Brown & Wood LLP,
New York, New York.
EXPERTS
The consolidated financial statements of Reckson Service Industries,
Inc. (the "Company") appearing in the Company's Annual Report (Form 10-K) for
the year ended December 31, 1998; and the consolidated financial statements of
Interoffice Superholdings Corporation and Subsidiaries for the period November
9, 1998 to December 31, 1998 appearing in the Company's Form 10-K for the year
ended December 31, 1998; and the consolidated financial statements of RSVP
Holdings, LLC for the period February 26, 1998 to December 31, 1998, appearing
in the Company's Form 10-K for the year ended December 31, 1998; and the
combined financial statements of Xebec Management Services, Inc. and affiliate
for the years ended December 31, 1997 and 1996, appearing in the Company's
Form 8-K dated January 19, 1999; and the consolidated financial statements of
InterOffice (Holdings) Corporation and Subsidiaries for the years ended
December 31, 1997, 1996 and 1995 appearing in the Company's Form 8-K dated
January 19, 1999, have in each case been audited by Ernst & Young LLP,
independent auditors, as set forth in their reports thereon, incorporated
herein by reference. Such consolidated and combined financial statements are
incorporated herein by reference in reliance upon such reports given on the
authority of such firm as experts in accounting and auditing.
The financial statements incorporated in this Prospectus by reference
to the audited historical consolidated financial statements of VANTAS
Incorporated and Subsidiaries (formerly ALLIANCE NATIONAL Incorporated and
Subsidiaries) as of June 30, 1998 and 1997 and December 31, 1998 and for the
years ended June 30, 1998, 1997 and 1996 and for the period July 1, 1998 to
December 31, 1998 appearing in Reckson Service Industries, Inc.'s Form 8-K/A
dated March 24, 1999, have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in accounting and auditing.
<PAGE>
<TABLE>
<CAPTION>
========================================================= ===========================================
--------------------------
<S> <C>
RECKSON SERVICE
INDUSTRIES, INC.
TABLE OF CONTENTS
Prospectus
Risk Factors......................................2
Available Information............................12
Incorporation of Certain Documents by
Reference .......................................12
The Company......................................12
Use of Proceeds..................................13
Ratios of Earnings to Combined Fixed
Charges..........................................14
Description of Debt Securities...................14
Description of Common Stock......................26
Description of Preferred Stock...................28
Description of Depositary Shares.................35
Restrictions on Ownership of Capital Stock.......39
Description of Warrants..........................41
Plan of Distribution.............................42
Legal Matters....................................42
Experts..........................................42
- -------------------------------------------
========================================================= ===========================================
</TABLE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following sets forth the estimated expenses in connection with
the issuance and distribution of the Registrant's securities being registered
hereby, other than underwriting discounts and commissions, all of which will
be borne by the Registrant:
Securities and Exchange Commission registration fee....... $139,000
NASD fees................................................. $ 30,500
Printing and engraving expenses........................... $300,000
Legal fees and expenses................................... $300,000
Accounting fees and expenses.............................. $ 80,000
Blue Sky fees and expenses................................ $ 20,000
Trustee's fees............................................ $ 10,000
Miscellaneous............................................. $ 70,500
---------
Total $950,000
=========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Delaware General Corporation Law (the "Delaware Law") provides
that a corporation may limit the liability of each director to the corporation
of its stockholders for monetary damages except for liability (i) for any
breach of the director's duty of loyalty to the corporation or its
stockholders; (ii) for acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law; (iii) in respect of
certain unlawful dividend payments or stock redemptions or repurchases, and
(iv) for any transaction from which the director derives an improper personal
benefit. The Certificate of Incorporation and ByLaws provide for the
elimination and limitation of the personal liability of directors of the
Company for monetary damages to the fullest extent permitted by the Delaware
Law. In addition, the Certificate of Incorporation and Bylaws provide that if
the Delaware Law is amended to authorize the further elimination or limitation
of the liability of a director, then the liability of the directors shall be
eliminated or limited to the fullest extent permitted by the Delaware Law, as
so amended. The effect of this provision is to eliminate the rights of the
Company and its stockholders (through stockholders' derivative suits on behalf
of the Company) to recover monetary damages against a director for breach of
the fiduciary duty of care as a director (including breaches resulting from
negligent or grossly negligent behavior) except in the situations described in
clauses (i) through (iv) above. The provision does not limit or eliminate the
rights of the Company or any stockholder to seek non-monetary relief such as
an injunction or rescission in the event of a breach of a director's duty of
care. In addition, the Bylaws provide that the Company shall, to the full
extent permitted by the Delaware Law, as amended from time to time, indemnify
and advance expenses to each of its currently acting and former directors,
officers, members of the management advisory committee, employees and agents.
ITEM 16. EXHIBITS.
1 -- Form of Underwriting Agreement.(1)
4.1 -- Form of Common Stock Certificate.(2)
4.2 -- Form of Designating Amendment for Preferred Stock.(1)
4.3 -- Form of Preferred Stock Certificate.(1)
4.4 -- Form of Warrant Agreement.(1)
4.5 -- Form of Warrant.(1)
4.6 -- Form of Indenture.
5 -- Opinion of Brown & Wood LLp as to the legality of
the Securities.(3)
12.1 -- Calculation of Ratios of Earnings to Fixed Charges.
23.1 -- Consent of Brown & Wood LLP (included in Exhibit 5). (3)
23.2 -- Consent of Ernst & Young LLP.
23.3 -- Consent of PricewaterhouseCoopers LLP.
24 -- Power of attorney (previously included on the signature
page of this Registration Statement).
- ---------------
(1) To be filed by amendment or incorporated by reference in connection
with the offering of Securities.
(2) Previously filed as an exhibit to Registration Statement on Form S-1
(No. 333-44419) and incorporated herein by reference.
(3) Previously filed as an exhibit to this Registration Statement.
ITEM 17. UNDERTAKINGS.
(a) The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to the Registration Statement;
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement.
provided, however, that paragraphs (1)(i) and (1)(ii) 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 Registrant pursuant to Section 13 or 15(d) of the Exchange Act
that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof; and
(3) (a) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in the Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers, partners and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid by a director,
officer, partner or controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such director,
officer, partner 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 and will be governed
by the final adjudication of such issue.
(d) The Registrant hereby undertakes to file an application
for the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act in accordance with
the rules and regulations prescribed by the Commission under Section 305
(b)(2) of the Act.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Reckson
Service Industries, Inc. certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on December 7, 1999.
RECKSON SERVICE INDUSTRIES, INC.
By: /s/ Scott H. Rechler
-----------------------------------
Scott H. Rechler
President and Chief Executive
Officer
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed by the following persons
in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
Donald J. Rechler* Chairman of the Board and Director
-----------------------
Donald J. Rechler
/s/ Scott H. Rechler President, Chief Executive Officer and Director December 7, 1999
----------------------- (Principal Executive Officer)
Scott H. Rechler
/s/ Michael Maturo Executive Vice President, Treasurer, Chief December 7, 1999
----------------------- Financial Officer (Principal Financial Officer
Michael Maturo and Principal Accounting Officer) and Director
Roger M. Rechler* Director
-----------------------
Roger M. Rechler
Mitchell D. Rechler* Secretary and Director
-----------------------
Mitchell D. Rechler
Gregg M. Rechler* Director
-----------------------
Gregg M. Rechler
Paul F. Amoruso* Director
-----------------------
Paul F. Amoruso
Ronald Cooper* Director
-----------------------
Ronald Cooper
*By: /s/ Michael Maturo
-----------------------
Michael Maturo December 7, 1999
Attorney-in-fact
</TABLE>
<PAGE>
EXHIBIT INDEX
EXHIBITS DESCRIPTION PAGE
4.6 -- Form of Indenture.
12.1 -- Calculation of Ratios of Earnings to Fixed Charges.
23.2 -- Consent of Ernst & Young LLP.
23.3 -- Consent of PricewaterhouseCoopers LLP.
EXHIBIT 4.6
RECKSON SERVICE INDUSTRIES, INC.,
Issuer
to
---------------------------------------,
Trustee
---------------
INDENTURE
---------------
Dated as of ________ __, 1999
Debt Securities
<PAGE>
Reconciliation and tie between
Trust Indenture Act of 1939 (the "Trust Indenture Act")
and Indenture
Trust Indenture
Act Section Indenture Section
ss.310(a)(1) 607
(a)(2) 607
(b) 608
ss.312(a) 701
(b) 702
(c) 702
ss.313(a) 703
(b)(2) 703
(c) 703
(d) 703
ss.314(a) 704
(c)(1) 102
(c)(2) 102
(e) 102
(f) 102
ss.316(a) (last sentence) 101
(a)(1)(A) 502, 512
(a)(1)(B) 513
(b) 508
ss.317(a)(1) 503
(a)(2) 504
(b) 1003
ss.318(a) 108
- ------------------
Note: This reconciliation and tie shall not, for any purpose, be deemed to
be part of the Indenture.
Attention should also be directed to Section 318(c) of the Trust
Indenture Act, which provides that the provisions of Sections 310 to
and including 317 are a part of and govern every qualified indenture,
whether or not physically contained herein.
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
<S> <C>
Section 101. Definitions.................................................................................2
Act......................................................................................................2
Additional Amounts.......................................................................................2
Affiliate................................................................................................2
Annual Service Charge....................................................................................3
Authenticating Agent.....................................................................................3
Authorized Newspaper.....................................................................................3
Bearer Security..........................................................................................3
Board of Directors.......................................................................................3
Board Resolution.........................................................................................3
Business Day.............................................................................................3
Commission...............................................................................................3
Common Stock.............................................................................................3
Conversion Event.........................................................................................3
Corporate Trust Office...................................................................................4
Corporation..............................................................................................4
Coupon...................................................................................................4
Currency.................................................................................................4
CUSIP number.............................................................................................4
Defaulted Interest.......................................................................................4
Dollars..................................................................................................4
Euro.....................................................................................................4
European Monetary System.................................................................................4
Event of Default.........................................................................................4
Exchange Act.............................................................................................4
Foreign Currency.........................................................................................4
GAAP.....................................................................................................4
Government Obligations...................................................................................4
Holder...................................................................................................5
Indebtedness.............................................................................................5
Indenture................................................................................................5
Independent Public Accountants...........................................................................5
Indexed Security.........................................................................................6
Interest.................................................................................................6
Interest Payment Date....................................................................................6
Issuer...................................................................................................6
Issuer Request...........................................................................................6
Judgment Currency........................................................................................6
Legal Holiday............................................................................................6
Lien.....................................................................................................6
Maturity.................................................................................................6
New York Banking Day.....................................................................................6
Office...................................................................................................6
Officers' Certificate....................................................................................7
Opinion of Counsel.......................................................................................7
Original Issue Discount Security.........................................................................7
Outstanding..............................................................................................7
Paying Agent.............................................................................................8
Permitted Debt...........................................................................................8
Person...................................................................................................8
Place of Payment.........................................................................................8
Predecessor Security.....................................................................................8
Redemption Date..........................................................................................9
Redemption Price.........................................................................................9
Registered Security......................................................................................9
Regular Record Date......................................................................................9
Required Currency........................................................................................9
Responsible Officer......................................................................................9
Security.................................................................................................9
Security Register........................................................................................9
Special Record Date......................................................................................9
Stated Maturity..........................................................................................9
Subsidiary...............................................................................................9
Trust Indenture Act......................................................................................9
Trustee.................................................................................................10
United States...........................................................................................10
United States Alien.....................................................................................10
U.S. Depository.........................................................................................10
Vice President..........................................................................................10
Voting Stock............................................................................................10
Section 102. Compliance Certificates and Opinions.......................................................10
Section 103. Form of Documents Delivered to Trustee.....................................................11
Section 104. Acts of Holders............................................................................11
Section 105. Notices, etc., to Trustee and Issuer.......................................................13
Section 106. Notice to Holders of Securities; Waiver....................................................13
Section 107. Language of Notices........................................................................14
Section 108. Conflict with Trust Indenture Act..........................................................15
Section 109. Effect of Headings and Table of Contents...................................................15
Section 110. Successors and Assigns.....................................................................15
Section 111. Separability Clause........................................................................15
Section 112. Benefits of Indenture......................................................................15
Section 113. Governing Law..............................................................................15
Section 114. Legal Holidays.............................................................................15
Section 115. Counterparts...............................................................................16
Section 116. Judgment Currency..........................................................................16
ARTICLE TWO
SECURITIES FORMS
Section 201. Forms Generally............................................................................16
Section 202. Form of Trustee's Certificate of Authentication............................................17
Section 203. Securities in Global Form..................................................................17
ARTICLE THREE
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series.......................................................18
Section 302. Currency; Denominations....................................................................22
Section 303. Execution, Authentication, Delivery and Dating.............................................22
Section 304. Temporary Securities.......................................................................24
Section 305. Registration, Transfer and Exchange........................................................25
Section 306. Mutilated, Destroyed, Lost and Stolen Securities...........................................28
Section 307. Payment of Interest and Certain Additional Amounts; Rights to Interest and
Certain Additional Amounts Preserved.....................................................29
Section 308. Persons Deemed Owners......................................................................31
Section 309. Cancellation...............................................................................31
Section 310. Computation of Interest....................................................................32
ARTICLE FOUR
SATISFACTION AND DISCHARGE OF INDENTURE
Section 401. Satisfaction and Discharge.................................................................32
Section 402. Defeasance and Covenant Defeasance.........................................................33
Section 403. Application of Trust Money.................................................................37
ARTICLE FIVE
REMEDIES
Section 501. Events of Default..........................................................................37
Section 502. Acceleration of Maturity; Rescission and Annulment.........................................39
Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee............................40
Section 504. Trustee May File Proofs of Claim...........................................................41
Section 505. Trustee May Enforce Claims without Possession of Securities or Coupons.....................42
Section 506. Application of Money Collected.............................................................42
Section 507. Limitations on Suits.......................................................................43
Section 508. Unconditional Right of Holders to Receive Principal and any Premium,
Interest and Additional Amounts..........................................................43
Section 509. Restoration of Rights and Remedies.........................................................43
Section 510. Rights and Remedies Cumulative.............................................................44
Section 511. Delay or Omission Not Waiver...............................................................44
Section 512. Control by Holders of Securities...........................................................44
Section 513. Waiver of Past Defaults....................................................................44
Section 514. Waiver of Stay or Extension Laws...........................................................45
Section 515. Undertaking for Costs......................................................................45
ARTICLE SIX
THE TRUSTEE
Section 601. Certain Rights of Trustee..................................................................46
Section 602. Notice of Defaults.........................................................................47
Section 603. Not Responsible for Recitals or Issuance of Securities.....................................47
Section 604. May Hold Securities........................................................................48
Section 605. Money Held in Trust........................................................................48
Section 606. Compensation and Reimbursement.............................................................48
Section 607. Corporate Trustee Required; Eligibility....................................................49
Section 608. Resignation and Removal; Appointment of Successor..........................................49
Section 609. Acceptance of Appointment by Successor.....................................................50
Section 610. Merger, Conversion, Consolidation or Succession to Business................................52
Section 611. Appointment of Authenticating Agent........................................................52
ARTICLE SEVEN
HOLDERS LISTS AND REPORTS BY TRUSTEE AND ISSUER
Section 701. Issuer to Furnish Trustee Names and Addresses of Holders...................................54
Section 702. Preservation of Information; Communications to Holders.....................................54
Section 703. Reports by Trustee.........................................................................54
Section 704. Reports by Issuer..........................................................................55
ARTICLE EIGHT
CONSOLIDATION, MERGER AND SALES
Section 801. Issuer May Consolidate, Etc., Only on Certain Terms........................................55
Section 802. Successor Person Substituted for Issuer....................................................56
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures without Consent of Holders.........................................56
Section 902. Supplemental Indentures with Consent of Holders............................................58
Section 903. Execution of Supplemental Indentures.......................................................59
Section 904. Effect of Supplemental Indentures..........................................................59
Section 905. Reference in Securities to Supplemental Indentures.........................................59
Section 906. Conformity with Trust Indenture Act........................................................59
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal, any Premium, Interest and Additional Amounts.........................60
Section 1002. Maintenance of Office or Agency............................................................60
Section 1003. Money for Securities Payments to Be Held in Trust..........................................61
Section 1004. Additional Amounts.........................................................................62
Section 1005. [Intentionally Omitted]....................................................................63
Section 1006. [Intentionally Omitted]....................................................................63
Section 1007. Waiver of Certain Covenants................................................................63
Section 1008. Issuer Statement as to Compliance; Notice of Certain Defaults..............................64
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article...................................................................64
Section 1102. Election to Redeem; Notice to Trustee......................................................64
Section 1103. Selection by Trustee of Securities to be Redeemed..........................................64
Section 1104. Notice of Redemption.......................................................................65
Section 1105. Deposit of Redemption Price................................................................66
Section 1106. Securities Payable on Redemption Date......................................................67
Section 1107. Securities Redeemed in Part................................................................68
ARTICLE TWELVE
SINKING FUNDS
Section 1201. Applicability of Article...................................................................68
Section 1202. Satisfaction of Sinking Fund Payments with Securities......................................68
Section 1203. Redemption of Securities for Sinking Fund..................................................69
ARTICLE THIRTEEN
REPAYMENT AT THE OPTION OF HOLDERS
Section 1301. Applicability of Article...................................................................69
ARTICLE FOURTEEN
SECURITIES IN FOREIGN CURRENCIES
Section 1401. Applicability of Article...................................................................70
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
Section 1501. Purposes for Which Meetings May Be Called..................................................70
Section 1502. Call, Notice and Place of Meetings.........................................................70
Section 1503. Persons Entitled to Vote at Meetings.......................................................71
Section 1504. Quorum; Action.............................................................................71
Section 1505. Determination of Voting Rights; Conduct and Adjournment of Meetings........................72
Section 1506. Counting Votes and Recording Action of Meetings............................................73
</TABLE>
<PAGE>
INDENTURE, dated as of __________ __, 1999 (the
"Indenture"), by and between RECKSON SERVICE INDUSTRIES, INC., a corporation
duly organized and existing under the laws of Delaware (hereinafter called the
"Issuer"), having its principal executive office located at 10 East 50th
Street, New York, New York 10022 and ________________, a ___________ banking
corporation (hereinafter called the "Trustee"), having its Corporate Trust
Office located at ___________________.
RECITALS
The execution and delivery by the Issuer of this Indenture
to provide for the issuance from time to time of the Issuer's senior unsecured
debentures, notes or other evidences of Indebtedness (hereinafter called the
"Securities"), unlimited as to principal amount, to bear such rates of
interest, to mature at such time or times, to be issued in one or more series
and to have such other provisions as shall be fixed as hereinafter provided,
has been duly authorized.
All things necessary to make this Indenture a valid
agreement of the Issuer, in accordance with its terms, have been done.
This Indenture is subject to the provisions of the Trust
Indenture Act of 1939, as amended, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder that are required to
be part of this Indenture and, to the extent applicable, shall be governed by
such provisions.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders (as herein defined) thereof, it is mutually
covenanted and agreed, for the equal and proportionate benefit of all Holders
of the Securities or of any series thereof and any Coupons (as herein defined)
as follows:
<PAGE>
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions.
Except as otherwise expressly provided in or pursuant to this
Indenture or unless the context otherwise requires, for all purposes of this
Indenture:
Section 105. Notice, etc., to Trustee and Issuer.
(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 terms "generally accepted accounting principles" or "GAAP" with
respect to any computation required or permitted hereunder shall mean
such accounting principles as are generally accepted at the date of such
computation;
(4) the words "herein", "hereof", "hereto" 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; and
(5) the word "or" is always used inclusively (for example, the
phrase "A or B" means "A or B or both", not "either A or B but not
both").
Certain terms used principally in certain Articles hereof are
defined in those Articles.
"Act," when used with respect to any Holders, has the meaning
specified in Section 104.
"Additional Amounts" means any additional amounts which are required
hereby or by any Security, under circumstances specified herein or therein, to
be paid by the Issuer in respect of certain taxes, assessments or other
governmental charges imposed on Holders specified therein and which are owing
to such Holders.
"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 the meanings correlative to
the foregoing.
"Annual Service Charge" as of any date means the amount which is
expensed in any 12-month period for interest on Indebtedness.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 611 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Authorized Newspaper" means a newspaper, in an official language of
the place of publication or in the English language, customarily published on
each day that is a Business Day in the place of publication, whether or not
published on days that are Legal Holidays in the place of publication, and of
general circulation in each place in connection with which the term is used or
in the financial community of each such place. Where successive publications
are required to be made in Authorized Newspapers, the successive publications
may be made in the same or in different newspapers in the same city meeting
the foregoing requirements and in each case on any day that is a Business Day
in the place of publication.
"Bearer Security" means any Security in the form established
pursuant to Section 201 which is payable to bearer.
"Board of Directors" means the board of directors of the Issuer or
any committee of that board duly authorized to act hereunder.
"Board Resolution" means a copy of one or more resolutions,
certified by the Secretary or an Assistant Secretary of the Issuer to have
been duly adopted by the Board of Directors and to be in full force and effect
on the date of such certification, delivered to the Trustee.
"Business Day," with respect to any Place of Payment or in The City
of New York, means, unless otherwise specified with respect to any Securities
pursuant to Section 301, any day other than a Saturday, Sunday or other day on
which banking institutions in such Place of Payment or in The City of New York
are authorized or obligated by law, regulation or executive order to close.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934,
as amended, or, if at any time after the execution of this Indenture such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act, then the body performing such duties at such time.
"Common Stock" includes any stock of any class of the Issuer which
has no preference in respect of dividends or of amounts payable in the event
of any voluntary or involuntary liquidation, dissolution or winding up of the
Issuer and which is not subject to redemption by the Issuer.
"Conversion Event" means the cessation of use of (i) a Foreign
Currency both by the government of the country or the confederation which
issued such Foreign Currency and for the settlement of transactions by a
central bank or other public institutions of or within the international
banking community or (ii) the Euro both within the European Monetary System
and for the settlement of transactions by public institutions of or within the
European Community.
"Corporate Trust Office" means the principal corporate trust office
of the Trustee at which at any particular time its corporate trust business
shall be administered, which office at the date of original execution of this
Indenture is located at _____________________________.
"Corporation" includes corporations and limited liability companies
and, except for purposes of Article Eight, associations, companies and
business trusts.
"Coupon" means any interest coupon appertaining to a Bearer
Security.
"Currency," with respect to any payment, deposit or other transfer
in respect of the principal of or any premium or interest on or any Additional
Amounts with respect to any Security, means Dollars or the Foreign Currency,
as the case may be, in which such payment, deposit or other transfer is
required to be made by or pursuant to the terms hereof or such Security and,
with respect to any other payment, deposit or transfer pursuant to or
contemplated by the terms hereof or such Security, means Dollars.
"CUSIP number" means the alphanumeric designation assigned to a
Security by Standard & Poor's Corporation, CUSIP Service Bureau.
"Defaulted Interest" has the meaning specified in Section 307.
"Dollars" or "$" means a dollar or other equivalent unit of legal
tender for payment of public or private debts in the United States of America.
"Euro" means the European Currency Units as defined and revised from
time to time by the Council of the European Community.
"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of the
European Community.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Foreign Currency" means any currency, currency unit or composite
currency, including, without limitation, the Euro, issued by the government of
one or more countries other than the United States of America or by any
recognized confederation or association of such governments.
"GAAP" means such accounting principles as are generally accepted in
the United States of America as of the date or time of any computation
required hereunder.
"Government Obligations" means securities which are (i) direct
obligations of the United States of America or the other government or
governments in the confederation which issued the Foreign Currency in which
the principal of or any premium or interest on such Security or any Additional
Amounts in respect thereof shall be payable, in each case where the payment or
payments thereunder are supported by the full faith and credit of such
government or governments or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America or such other government or governments, in each case where the
timely payment or payments thereunder are unconditionally guaranteed as a full
faith and credit obligation by the United States of America or such other
government or governments, and which, in the case of (i) or (ii), are not
callable or redeemable at the option of the issuer or issuers thereof, and
shall also include a depository receipt issued by a bank or trust company as
custodian with respect to any such Government Obligation or a specific payment
of interest on or principal of or other amount with respect to any such
Government Obligation held by such custodian for the account of the holder of
a depository receipt, provided that (except as required by law) such custodian
is not authorized to make any deduction from the amount payable to the holder
of such depository receipt from any amount received by the custodian in
respect of the Government Obligation or the specific payment of interest on or
principal of or other amount with respect to the Government Obligation
evidenced by such depository receipt.
"Holder," in the case of any Registered Security, means the Person
in whose name such Security is registered in the Security Register and, in the
case of any Bearer Security, means the bearer thereof and, in the case of any
Coupon, means the bearer thereof.
"Indebtedness" means any indebtedness, whether or not contingent, in
respect of (i) borrowed money evidenced by bonds, notes, debentures or similar
instruments, (ii) indebtedness secured by any mortgage, pledge, lien, charge,
encumbrance or any security interest existing on property, (iii) the
reimbursement obligations, contingent or otherwise, in connection with any
letters of credit actually issued or amounts representing the balance deferred
and unpaid of the purchase price of any property except any such balance that
constitutes an accrued expense or trade payable or (iv) any lease of property
as lessee which would be reflected on a balance sheet as a capitalized lease
in accordance with GAAP, in the case of items of indebtedness under (i)
through (iii) above to the extent that any such items (other than letters of
credit) would appear as a liability on a balance sheet in accordance with
GAAP, and also includes, to the extent not otherwise included, any obligation
to be liable for, or to pay, as obligor or otherwise (other than for purposes
of collection in the ordinary course of business), indebtedness of another
Person.
"Indenture" means this instrument 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 and, with respect to any
Security, by the terms and provisions of such Security and any Coupon
appertaining thereto established pursuant to Section 301 (as such terms and
provisions may be amended pursuant to the applicable provisions hereof).
"Independent Public Accountants" means accountants or a firm of
accountants that, with respect to the Issuer and any other obligor under the
Securities or the Coupons, are independent public accountants within the
meaning of the Securities Act of 1933, as amended, and the rules and
regulations promulgated by the Commission thereunder, who may be the
independent public accountants regularly retained by the Issuer or who may be
other independent public accountants. Such accountants or firm shall be
entitled to rely upon any Opinion of Counsel as to the interpretation of any
legal matters relating to this Indenture or certificates required to be
provided hereunder.
"Indexed Security" means a Security the terms of which provide that
the principal amount thereof payable at Stated Maturity may be more or less
than the principal face amount thereof at original issuance.
"Interest," with respect to any Original Issue Discount Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity and, when used with respect to a Security which provides for
the payment of Additional Amounts pursuant to Section 1004, includes such
Additional Amounts.
"Interest Payment Date," with respect to any Security, means the
Stated Maturity of an installment of interest on such Security.
"Issuer" means the Person named as the "Issuer" 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
"Issuer" shall mean such successor Person, and any other obligor upon the
Securities.
"Issuer Request" and "Issuer Order" mean, respectively, a written
request or order, as the case may be, signed in the name of the Issuer by the
Chairman of the Board of Directors, a Vice Chairman, the President or a Vice
President, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary, of the Issuer, and delivered to the Trustee.
"Judgment Currency" has the meaning specified in Section 116.
"Legal Holiday" means a day that is not a Business Day.
"Lien" means, with respect to any Person, any mortgage, lien,
pledge, charge, security interest or other encumbrance, or any interest or
title of any vendor, lessor, lender or other secured party to or of such
Person under any conditional sale or other title retention agreement or
Capital Lease, upon or with respect to any property or asset of such Person. A
Capital Lease is a lease to which the lessee is required concurrently to
recognize the acquisition of an asset and the incurrence of a liability in
accordance with GAAP.
"Maturity," 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 provided in or pursuant to this Indenture, whether at the Stated
Maturity or by declaration of acceleration, notice of redemption or
repurchase, notice of option to elect repayment or otherwise, and includes the
Redemption Date.
"New York Banking Day" has the meaning specified in Section 116.
"Office" or "Agency," with respect to any Securities, means an
office or agency of the Issuer maintained or designated in a Place of Payment
for such Securities pursuant to Section 1002 or any other office or agency of
the Issuer maintained or designated for such Securities pursuant to Section
1002 or, to the extent designated or required by Section 1002 in lieu of such
office or agency, the Corporate Trust Office of the Trustee.
"Officers' Certificate" means a certificate signed by the Chairman
of the Board, a Vice Chairman, the President or a Vice President, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
the Issuer, that complies with the requirements of Section 314(e) of the Trust
Indenture Act and is delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
an employee of or counsel for the Issuer or other counsel who shall be
reasonably acceptable to the Trustee, that, if required by the Trust Indenture
Act, complies with the requirements of Section 314(e) of the Trust Indenture
Act.
"Original Issue Discount Security" means a Security issued pursuant
to this Indenture which provides for declaration of an amount less than the
principal face amount thereof to be due and payable upon acceleration pursuant
to Section 502.
"Outstanding," when used with respect to any Securities, means, as
of the date of determination, all such Securities theretofore authenticated
and delivered under this Indenture, except:
(a) any such Security theretofore cancelled by the
Trustee or the Security Registrar or delivered to
the Trustee or the Security Registrar for
cancellation;
(b) any such Security for whose payment at the Maturity
thereof money in the necessary amount has been
theretofore deposited pursuant hereto (other than
pursuant to Section 402) with the Trustee or any
Paying Agent (other than the Issuer) in trust or
set aside and segregated in trust by the Issuer (if
the Issuer shall act as its own Paying Agent) for
the Holders of such Securities and any Coupons
appertaining thereto, provided that, if such
Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the
Trustee has been made;
(c) any such Security with respect to which the Issuer
has effected defeasance pursuant to the terms
hereof, except to the extent provided in Section
402; and
(d) any such Security which has 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, unless there
shall have been presented to the Trustee proof
satisfactory to it that such Security is held by a
bona fide purchaser in whose hands such Security is
a valid obligation of the Issuer.
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or are present
at a meeting of Holders of Securities for quorum purposes, (i) the principal
amount of an Original Issue Discount Security that may be counted in making
such determination and that shall be deemed to be Outstanding for such
purposes shall be equal to the amount of the principal thereof that pursuant
to the terms of such Original Issue Discount Security would be declared (or
shall have been declared to be) due and payable upon a declaration of
acceleration thereof pursuant to Section 502 at the time of such
determination, and (ii) the principal amount of any Indexed Security that may
be counted in making such determination and that shall be deemed outstanding
for such purpose shall be equal to the principal face amount of such Indexed
Security at original issuance, unless otherwise provided in or pursuant to
this Indenture, and (iii) the principal amount of a Security denominated in a
Foreign Currency shall be the Dollar equivalent, determined on the date of
original issuance of such Security, of the principal amount (or, in the case
of an Original Issue Discount Security, the Dollar equivalent on the date of
original issuance of such Security of the amount determined as provided in (i)
above) of such Security, and (iv) Securities owned by the Issuer or any other
obligor upon the Securities or any Affiliate of the Issuer or such other
obligor, shall be disregarded and deemed not to be Outstanding, except that,
in determining whether the Trustee shall be protected in making any such
determination or relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Securities which a Responsible
Officer of the Trustee knows to be so owned shall be so disregarded.
Securities so owned which shall have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee (A) the pledgee's right so to act with respect to such Securities and
(B) that the pledgee is not the Issuer or any other obligor upon the
Securities or any Coupons appertaining thereto or an Affiliate of the Issuer
or such other obligor.
"Paying Agent" means any Person authorized by the Issuer to pay the
principal of, or any premium or interest on, or any Additional Amounts with
respect to, any Security or any Coupon on behalf of the Issuer.
"Permitted Debt" means Indebtedness of the Issuer or any Subsidiary
owing to any Subsidiary or the Issuer; provided that any such Indebtedness is
made pursuant to an intercompany note and is subordinated in right of payment
to the Securities; provided further that any disposition, pledge or transfer
of any such Indebtedness to a Person (other than the Issuer or another
Subsidiary) shall be deemed to be an incurrence of such Indebtedness by the
Issuer or a Subsidiary, as the case may be, and not Permitted Debt as defined
herein.
"Person" means any individual, Corporation, partnership, joint
venture, joint-stock company, trust, unincorporated organization or government
or any agency or political subdivision thereof.
"Place of Payment," with respect to any Security, means the place or
places where the principal of, or any premium or interest on, or any
Additional Amounts with respect to such Security are payable as provided in or
pursuant to this Indenture or such Security.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same Indebtedness 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 lost, destroyed, mutilated or stolen Security or
any Security to which a mutilated, destroyed, lost or stolen Coupon appertains
shall be deemed to evidence the same Indebtedness as the lost, destroyed,
mutilated or stolen Security or the Security to which a mutilated, destroyed,
lost or stolen Coupon appertains.
"Redemption Date," with respect to any Security or portion thereof
to be redeemed, means the date fixed for such redemption by or pursuant to
this Indenture or such Security.
"Redemption Price," with respect to any Security or portion thereof
to be redeemed, means the price at which it is to be redeemed as determined by
or pursuant to this Indenture or such Security.
"Registered Security" means any Security established pursuant to
Section 201 which is registered in the Security Register.
"Regular Record Date" for the interest payable on any Registered
Security on any Interest Payment Date therefor means the date, if any,
specified in or pursuant to this Indenture or such Security as the "Regular
Record Date".
"Required Currency" has the meaning specified in Section 116.
"Responsible Officer" means any officer of the Trustee in its
Corporate Trust Office and also means, with respect to a particular corporate
trust matter, any other officer of the Trustee to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Security" or "Securities" means any note or notes, bond or bonds,
debenture or debentures, or any other evidences of Indebtedness, as the case
may be, authenticated and delivered under this Indenture; provided, however,
that, if at any time there is more than one Person acting as Trustee under
this Indenture, "Securities", with respect to any such Person, shall mean
Securities authenticated and delivered under this Indenture, exclusive,
however, of Securities of any series as to which such Person is not Trustee.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Special Record Date" for the payment of any Defaulted Interest on
any Registered Security means a date fixed by the Trustee pursuant to Section
307.
"Stated Maturity," with respect to any Security or any installment
of principal thereof or interest thereon or any Additional Amounts with
respect thereto, means the date established by or pursuant to this Indenture
or such Security as the fixed date on which the principal of such Security or
such installment of principal or interest is, or such Additional Amounts are,
due and payable.
"Subsidiary" means any entity of which at the time of determination
the Issuer or one or more subsidiaries owns or controls directly or indirectly
more than 50% of the shares of Voting Stock.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended, and any reference herein to the Trust Indenture Act or a particular
provision thereof shall mean such Act or provision, as the case may be, as
amended or replaced from time to time or as supplemented from time to time by
rules or regulations adopted by the Commission under or in furtherance of the
purposes of such Act or provision, as the case may be.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
with respect to one or more series of Securities pursuant to the applicable
provisions of this Indenture, and thereafter "Trustee" shall mean each Person
who is then a Trustee hereunder; provided, however, that if at any time there
is more than one such Person, "Trustee" shall mean each such Person and as
used with respect to the Securities of any series shall mean the Trustee with
respect to the Securities of such series.
"United States," except as otherwise provided in or pursuant to this
Indenture or any Security, means the United States of America (including the
states thereof and the District of Columbia), its territories and possessions
and other areas subject to its jurisdiction.
"United States Alien," except as otherwise provided in or pursuant
to this Indenture or any Security, means any Person who, for United States
Federal income tax purposes, is a foreign corporation, a non-resident alien
individual, a non-resident alien fiduciary of a foreign estate or trust, or a
foreign partnership one or more of the members of which is, for United States
Federal income tax purposes, a foreign corporation, a non-resident alien
individual or a non-resident alien fiduciary of a foreign estate or trust.
"U.S. Depository" or "Depository" means, with respect to any
Security issuable or issued in the form of one or more global Securities, the
Person designated as U.S. Depository or Depository by the Issuer in or
pursuant to this Indenture, which Person must be, to the extent required by
applicable law or regulation, a clearing agency registered under the
Securities Exchange Act of 1934, as amended, and, if so provided with respect
to any Security, any successor to such Person. If at any time there is more
than one such Person, "U.S. Depository" or "Depository" shall mean, with
respect to any Securities, the qualifying entity which has been appointed with
respect to such Securities.
"Vice President," when used with respect to a vice president of the
Issuer, or with respect to the 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".
"Voting Stock" means stock of a Corporation of the class or classes
having general voting power under ordinary circumstances to elect at least a
majority of the board of directors, managers or trustees of such Corporation
provided that, for the purposes hereof, stock which carries only the right to
vote conditionally on the happening of an event shall not be considered voting
stock whether or not such event shall have happened.
Section 102. Compliance Certificates and Opinions.
Except as otherwise expressly provided in this Indenture, upon any
application or request by the Issuer to the Trustee to take any action under
any provision of this Indenture, the Issuer shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent, if any, provided
for in this Indenture relating to the proposed action have been complied with
and an Opinion of Counsel stating that, in the opinion of such counsel, all
such conditions precedent, if any, have been complied with, except that in the
case of any such application or request as to which the furnishing of such
documents or any of them is specifically required by any provision of this
Indenture relating to such particular application or request, no additional
certificate or opinion need be furnished.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such Person may
certify or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Issuer may be based,
insofar as it relates to legal matters, upon an Opinion of Counsel, unless
such officer knows, or in the exercise of reasonable care should know, that
the opinion with respect to the matters upon which his certificate or opinion
is based are erroneous. Any such 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 Issuer stating that the
information with respect to such factual matters is in the possession of the
Issuer, 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 or any Security, they may, but need not, be
consolidated and form one instrument.
Section 104. Acts of Holders.
(1) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by or pursuant to this Indenture to be given
or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by an agent duly appointed in writing. If, but only if, Securities of a series
are issuable as Bearer Securities, any request, demand, authorization,
direction, notice, consent, waiver or other action provided in or pursuant to
this Indenture to be given or taken by Holders of Securities of such series
may, alternatively, be embodied in and evidenced by the record of Holders of
Securities of such series voting in favor thereof, either in person or by
proxies duly appointed in writing, at any meeting of Holders of Securities of
such series duly called and held in accordance with the provisions of Article
Fifteen, or a combination of such instruments and any such record. Except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments or record or both are delivered to the Trustee
and, where it is hereby expressly required, to the Issuer. Such instrument or
instruments and any such record (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments or so voting at any such meeting. Proof of
execution of any such instrument or of a writing appointing any such agent, or
of the holding by any Person of a Security, shall be sufficient for any
purpose of this Indenture and (subject to Section 315 of the Trust Indenture
Act) conclusive in favor of the Trustee and the Issuer and any agent of the
Trustee or the Issuer, if made in the manner provided in this Section. The
record of any meeting of Holders of Securities shall be proved in the manner
provided in Section 1506.
Without limiting the generality of this Section 104, unless
otherwise provided in or pursuant to this Indenture, a Holder, including a
U.S. Depository that is a Holder of a global Security, may make, give or take,
by a proxy, or proxies, duly appointed in writing, any request, demand,
authorization, direction, notice, consent, waiver or other Act provided in or
pursuant to this Indenture to be made, given or taken by Holders, and a U.S.
Depository that is a Holder of a global Security may provide its proxy or
proxies to the beneficial owners of interests in any such global Security
through such U.S. Depository's standing instructions and customary practices.
The Trustee shall fix a record date for the purpose of determining
the Persons who are beneficial owners of interest in any permanent global
Security held by a U.S. Depository entitled under the procedures of such U.S.
Depository to make, give or take, by a proxy or proxies duly appointed in
writing, any request, demand, authorization, direction, notice, consent,
waiver or other Act provided in or pursuant to this Indenture to be made,
given or taken by Holders. If such a record date is fixed, the Holders on such
record date or their duly appointed proxy or proxies, and only such Persons,
shall be entitled to make, give or take such request, demand, authorization,
direction, notice, consent, waiver or other Act, whether or not such Holders
remain Holders after such record date. No such request, demand, authorization,
direction, notice, consent, waiver or other Act shall be valid or effective if
made, given or taken more than 90 days after such record date.
(2) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any reasonable manner which the Trustee
deems sufficient and in accordance with such reasonable rules as the Trustee
may determine; and the Trustee may in any instance require further proof with
respect to any of the matters referred to in this Section.
(3) The ownership, principal amount and serial numbers of Registered
Securities held by any Person, and the date of the commencement and the date
of the termination of holding the same, shall be proved by the Security
Register.
(4) The ownership, principal amount and serial numbers of Bearer
Securities held by any Person, and the date of the commencement and the date
of the termination of holding the same, may be proved by the production of
such Bearer Securities or by a certificate executed, as depositary, by any
trust company, bank, banker or other depositary reasonably acceptable to the
Issuer, wherever situated, if such certificate shall be deemed by the Issuer
and the Trustee to be satisfactory, showing that at the date therein mentioned
such Person had on deposit with such depositary, or exhibited to it, the
Bearer Securities therein described; or such facts may be proved by the
certificate or affidavit of the Person holding such Bearer Securities, if such
certificate or affidavit is deemed by the Trustee to be satisfactory. The
Trustee and the Issuer may assume that such ownership of any Bearer Security
continues until (1) another certificate or affidavit bearing a later date
issued in respect of the same Bearer Security is produced, or (2) such Bearer
Security is produced to the Trustee by some other Person, or (3) such Bearer
Security is surrendered in exchange for a Registered Security, or (4) such
Bearer Security is no longer Outstanding. The ownership, principal amount and
serial numbers of Bearer Securities held by the Person so executing such
instrument or writing and the date of the commencement and the date of the
termination of holding the same may also be proved in any other manner which
the Issuer and the Trustee deem sufficient.
(5) If the Issuer shall solicit from the Holders of any Registered
Securities any request, demand, authorization, direction, notice, consent,
waiver or other Act, the Issuer may at its option (but is not obligated to),
by Board Resolution fix in advance a record date for the determination of
Holders of Registered Securities entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other Act. If such a
record date is fixed, such request, demand, authorization, direction, notice,
consent, waiver or other Act may be given before or after such record date,
but only the Holders of Registered Securities of record at the close of
business on such record date shall be deemed to be Holders for the purpose of
determining whether Holders of the requisite proportion of Outstanding
Securities have authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other Act, and for that
purpose the Outstanding Securities shall be computed as of such record date;
provided that no such authorization, agreement or consent by the Holders of
Registered Securities shall be deemed effective unless it shall become
effective pursuant to the provisions of this Indenture not later than six
months after the record date.
(6) Any request, demand, authorization, direction, notice, consent,
waiver or other Act by 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 or suffered to be done by the Trustee, any Security
Registrar, any Paying Agent or the Issuer in reliance thereon, whether or not
notation of such Act is made upon such Security.
Section 105. Notices, etc., to Trustee and Issuer.
Any request, demand, authorization, direction, notice, consent,
waiver or other 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 Trustee by any Holder or the Issuer shall be sufficient
for every purpose hereunder if made, given, furnished or filed in
writing (which may be by facsimile) to or with the Trustee at its
Corporate Trust Office, or
(2) the Issuer by the Trustee or 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 Issuer addressed to the attention of its Treasurer 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 Issuer.
Section 106. Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided in or pursuant to this
Indenture, where this Indenture provides for notice to Holders of Securities
of any event,
(1) such notice shall be sufficiently given to Holders of
Registered Securities if in writing and mailed, first-class postage
prepaid, to each Holder of a Registered Security 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; and
(2) such notice shall be sufficiently given to Holders of
Bearer Securities, if any, if published in an Authorized Newspaper
in The City of New York and, if such Securities are then listed on
any stock exchange outside the United States, in an Authorized
Newspaper in such city as the Issuer shall advise the Trustee that
such stock exchange so requires, on a Business Day at least twice,
the first such publication to be not earlier than the earliest date
and the second such publication not later than the latest date
prescribed for the giving of such notice.
In any case where notice to Holders of Registered Securities is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder of a Registered Security shall
affect the sufficiency of such notice with respect to other Holders of
Registered Securities or the sufficiency of any notice to Holders of Bearer
Securities given as provided herein. Any notice which is mailed in the manner
herein provided shall be conclusively presumed to have been duly given or
provided. In the 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 Trustee
shall constitute a sufficient notification for every purpose hereunder.
In case by reason of the suspension of publication of any Authorized
Newspaper or Authorized Newspapers or by reason of any other cause it shall be
impracticable to publish any notice to Holders of Bearers Securities as
provided above, then such notification to Holders of Bearer Securities as
shall be given with the approval of the Trustee shall constitute sufficient
notice to such Holders for every purpose hereunder. Neither failure to give
notice by publication to Holders of Bearer Securities as provided above, nor
any defect in any notice so published, shall affect the sufficiency of any
notice mailed to Holders of Registered Securities as provided above.
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 of Securities shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
Section 107. Language of Notices.
Any request, demand, authorization, direction, notice, consent,
election or waiver required or permitted under this Indenture shall be in the
English language, except that, if the Issuer so elects, any published notice
may be in an official language of the country of publication.
Section 108. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with any
duties under any required provision of the Trust Indenture Act imposed hereon
by Section 318(c) thereof, such required provision shall control.
Section 109. 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 110. Successors and Assigns.
All covenants and agreements in this Indenture by the Issuer shall
bind its successors and assigns, whether so expressed or not.
Section 111. Separability Clause.
In case any provision in this Indenture, any Security or any Coupon
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 112. Benefits of Indenture.
Nothing in this Indenture, any Security or any Coupon, express or
implied, shall give to any Person, other than the parties hereto, any Security
Registrar, any Paying Agent and their successors hereunder and the Holders of
Securities or Coupons, any benefit or any legal or equitable right, remedy or
claim under this Indenture.
Section 113. Governing Law.
This Indenture, the Securities and any Coupons shall be governed by
and construed in accordance with the laws of the State of New York applicable
to agreements made or instruments entered into and, in each case, performed in
said state.
Section 114. Legal Holidays.
Unless otherwise specified in or pursuant to this Indenture or any
Securities, in any case where any Interest Payment Date, Stated Maturity or
Maturity of any Security, or the last date on which a Holder has the right to
convert or exchange Securities of a series that are convertible or
exchangeable, shall be a Legal Holiday at any Place of Payment, then
(notwithstanding any other provision of this Indenture, any Security or any
Coupon other than a provision in any Security or Coupon that specifically
states that such provision shall apply in lieu hereof) payment need not be
made at such Place of Payment on such date, and such Securities need not be
converted or exchanged on such date but such payment may be made, and such
Securities may be converted or exchanged, on the next succeeding day that is a
Business Day at such Place of Payment with the same force and effect as if
made on the Interest Payment Date or at the Stated Maturity or Maturity or on
such last day for conversion, and no interest shall accrue on the amount
payable on such date or at such time for the period from and after such
Interest Payment Date, Stated Maturity, Maturity or last day for conversion,
as the case may be, to the next succeeding Business Day.
Section 115. Counterparts.
This Indenture may be executed in several counterparts, each of
which shall be an original and all of which shall constitute but one and the
same instrument.
Section 116. Judgment Currency.
The Issuer agrees, to the fullest extent that it may effectively do
so under applicable law, that (a) if for the purpose of obtaining judgment in
any court it is necessary to convert the sum due in respect of the principal
of, or premium or interest, if any, or Additional Amounts on the Securities of
any series (the "Required Currency") into a currency in which a judgment will
be rendered (the "Judgment Currency"), the rate of exchange used shall be the
rate at which in accordance with normal banking procedures the Trustee could
purchase in The City of New York the Required Currency with the Judgment
Currency on the New York Banking Day preceding that on which a final
unappealable judgment is given and (b) its obligations under this Indenture to
make payments in the Required Currency (i) shall not be discharged or
satisfied by any tender, or any recovery pursuant to any judgment (whether or
not entered in accordance with clause (a)), in any currency other than the
Required Currency, except to the extent that such tender or recovery shall
result in the actual receipt, by the payee, of the full amount of the Required
Currency expressed to be payable in respect of such payments, (ii) shall be
enforceable as an alternative or additional cause of action for the purpose of
recovering in the Required Currency the amount, if any, by which such actual
receipt shall fall short of the full amount of the Required Currency so
expressed to be payable and (iii) shall not be affected by judgment being
obtained for any other sum due under this Indenture. For purposes of the
foregoing, "New York Banking Day" means any day except a Legal Holiday in The
City of New York.
ARTICLE TWO
SECURITIES FORMS
Section 201. Forms Generally.
Each Registered Security, Bearer Security, Coupon and temporary or
permanent global Security issued pursuant to this Indenture shall be in the
form established by or pursuant to a Board Resolution or in one or more
indentures supplemental hereto, shall have such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
or pursuant to this Indenture or any indenture supplemental hereto and may
have such letters, numbers or other marks of identification and such legends
or endorsements placed thereon as may, consistently herewith, be determined by
the officers executing such Security or Coupon as evidenced by their execution
of such Security or Coupon.
Unless otherwise provided in or pursuant to this Indenture or any
Securities, the Securities shall be issuable in registered form without
Coupons and shall not be issuable upon the exercise of warrants.
Definitive Securities and definitive Coupons shall be printed,
lithographed or engraved or produced by any combination of these methods on a
steel engraved border or steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Issuer executing such
Securities or Coupons, as evidenced by their execution of such Securities or
Coupons.
Section 202. Form of Trustee's Certificate of Authentication.
Subject to Section 611, the 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.
,
-----------------------
as Trustee
By --------------------
Authorized Signatory
Section 203. Securities in Global Form.
Unless otherwise provided in or pursuant to this Indenture or any
Securities, the Securities shall not be issuable in temporary or permanent
global form. If Securities of a series shall be issuable in global form, any
such Security may provide that it or any number of such Securities shall
represent the aggregate amount of all Outstanding Securities of such series
(or such lesser amount as is permitted by the terms thereof) from time to time
endorsed thereon and may also provide that the aggregate amount of Outstanding
Securities represented thereby may from time to time be increased or reduced
to reflect exchanges. Any endorsement of any Security in global form to
reflect the amount, or any increase or decrease in the amount, or changes in
the rights of Holders, of Outstanding Securities represented thereby shall be
made in such manner and by such Person or Persons as shall be specified
therein or in the Issuer Order to be delivered pursuant to Section 303 or 304
with respect thereto. Subject to the provisions of Section 303 and, if
applicable, Section 304, the Trustee shall deliver and redeliver any Security
in permanent global form in the manner and upon instructions given by the
Person or Persons specified therein or in the applicable Issuer Order. If an
Issuer Order pursuant to Section 303 or 304 has been, or simultaneously is,
delivered, any instructions by the Issuer with respect to a Security in global
form shall be in writing but need not be accompanied by or contained in an
Officers' Certificate and need not be accompanied by an Opinion of Counsel.
Notwithstanding the provisions of Section 307, unless otherwise
specified in or pursuant to this Indenture or any Securities, payment of
principal of, any premium and interest on, and any Additional Amounts in
respect of, any Security in temporary or permanent global form shall be made
to the Person or Persons specified therein.
Notwithstanding the provisions of Section 308 and except as provided
in the preceding paragraph, the Issuer, the Trustee and any agent of the
Issuer and the Trustee shall treat as the Holder of such principal amount of
Outstanding Securities represented by a global Security (i) in the case of a
global Security in registered form, the Holder of such global Security in
registered form, or (ii) in the case of a global Security in bearer form, the
Person or Persons specified pursuant to Section 301.
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 in one or more series.
With respect to any Securities to be authenticated and delivered
hereunder, there shall be established in or pursuant to a Board Resolution and
set forth in an Officers' Certificate, or established in one or more
indentures supplemental hereto,
(1) the title of the Securities of the series (which shall
distinguish the Securities of such series from all other series of
Securities);
(2) any limit upon the aggregate principal amount of the
Securities of the series that 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 Section 304,
305, 306, 905 or 1107);
(3) the percentage of the principal amount at which the
Securities of the series will be issued and, if other than the
principal amount thereof, the portion of the principal amount
thereof payable upon declaration of acceleration of maturity
thereof;
(4) the date or dates, or the method by which such date or
dates will be determined, on which the principal of the Securities
of the series shall be payable;
(5) the rate or rates at which the Securities of the series
shall bear interest, if any, or the method by which such rate or
rates shall be determined, 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 such
interest will be payable and the Regular Record Date, if any, for
the interest payable on any Registered Security on any Interest
Payment Date, or the method by which such date shall be determined,
the person to whom such interest shall be payable, and the basis
upon which interest shall be calculated if other than that of a
360-day year of twelve 30-day months;
(6) the place or places, if any, other than or in addition to
The City of New York, where the principal of (and premium, if any),
interest, if any, on, and Additional Amounts, if any, payable in
respect of, Securities of the series shall be payable, any
Registered Securities of the series may be surrendered for
registration of transfer or exchange and notices or demands to or
upon the Issuer in respect of the Securities of the series and this
Indenture may be served;
(7) the period or periods within which, the price or prices at
which, the currency or currencies, currency unit or units or
composite currency or currencies in which, and other terms and
conditions upon which Securities of the series may be redeemed, in
whole or in part, at the option of the Issuer, if the Issuer is to
have the option;
(8) the obligation, if any, of the Issuer to redeem, repay or
purchase Securities of the series pursuant to any sinking fund or
analogous provision or at the option of a Holder thereof, and the
period or periods within which or the date or dates on which, the
price or prices at which, the currency or currencies, currency unit
or units or composite currency or currencies in which, and other
terms and conditions upon which Securities of the series shall be
redeemed, repaid or purchased, in whole or in part, pursuant to such
obligation;
(9) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which any Registered
Securities of the series shall be issuable and, if other than
denominations of $5,000 and any integral multiple thereof, the
denomination or denominations in which any Bearer Securities of the
series shall be issuable;
(10) if other than the Trustee, the identity of each Security
Registrar and/or Paying Agent;
(11) if other than the principal amount thereof, the portion of
the principal amount of Securities of the series that 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;
(12) if other than Dollars, the Foreign Currency or Currencies
in which payment of the principal of (and premium, if any) or
interest or Additional Amounts, if any, on the Securities of the
series shall be payable or in which the Securities of the series
shall be denominated;
(13) whether the amount of payments of principal of (and
premium, if any) or interest, if any, on the Securities of the
series may be determined with reference to an index, formula or
other method (which index, formula or method may be based, without
limitation, on one or more currencies, currency units, composite
currencies, commodities, equity indices or other indices), and the
manner in which such amounts shall be determined;
(14) whether the principal of (and premium, if any) or interest
or Additional Amounts, if any, on the Securities of the series are
to be payable, at the election of the Issuer or a Holder thereof, in
a currency or currencies, currency unit or units or composite
currency or currencies other than that in which such Securities are
denominated or stated to be payable, the period or periods within
which, and the terms and conditions upon which, such election may be
made, and the time and manner of, and identity of the exchange rate
agent with responsibility for, determining the exchange rate between
the currency or currencies, currency unit or units or composite
currency or currencies in which such Securities are denominated or
stated to be payable and the currency or currencies, currency unit
or units or composite currency or currencies in which such
Securities are to be so payable;
(15) provisions, if any, granting special rights to the Holders
of Securities of the series upon the occurrence of such events as
may be specified;
(16) any deletions from, modifications of or additions to the
Events of Default or covenants of the Issuer with respect to
Securities of the series, whether or not such Events of Default or
covenants are consistent with the Events of Default or covenants set
forth herein;
(17) whether Securities of the series are to be issuable as
Registered Securities, Bearer Securities (with or without coupons)
or both, any restrictions applicable to the offer, sale or delivery
of Bearer Securities and the terms upon which Bearer Securities of
the series may be exchanged for Registered Securities of the series
and vice versa (if permitted by applicable laws and regulations),
whether any Securities of the series are to be issuable initially in
temporary global form and whether any Securities of the series are
to be issuable in permanent global form with or without coupons and,
if so, whether beneficial owners of interests in any such permanent
global Security may exchange such interests for Securities of such
series and of like tenor of any authorized form and denomination and
the circumstances under which any such exchanges may occur, if other
than in the manner provided in Section 305, and, if Registered
Securities of the series are to be issuable as a global Security,
the identity of the depositary for such series;
(18) the date as of which any Bearer Securities of the series
and any temporary global Security representing Outstanding
Securities of the series shall be dated if other than the date of
original issuance of the first Security of the series to be issued;
(19) the Person to whom any interest on any Registered 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, the manner in which, or the Person to whom, any
interest on any Bearer Security of the series shall be payable, if
otherwise than upon presentation and surrender of the coupons
appertaining thereto as they severally mature, and the extent to
which, or the manner in which, any interest payable on a temporary
global Security on an Interest Payment Date will be paid if other
than in the manner provided in Section 304;
(20) if either or both of Section 402(2) relating to defeasance
or Section 402(3) relating to covenant defeasance shall not be
applicable to the Securities of such series or any provisions in
modification of, in addition to or in lieu of any of the provisions
of Article Four;
(21) if the Securities of such series are to be issuable in
definitive form (whether upon original issue or upon exchange of a
temporary Security of such series) only upon receipt of certain
certificates or other documents or satisfaction of other conditions,
then the form and/or terms of such certificates, documents or
conditions;
(22) if the Securities of the series are to be issued upon the
exercise of warrants, the time, manner and place for such Securities
to be authenticated and delivered;
(23) whether and under what circumstances the Issuer will pay
Additional Amounts on the Securities of the series to any Holder who
is not a United States person (including any modification to the
definition of such term) in respect of any tax, assessment or
governmental charge and, if so, whether the Issuer will have the
option to redeem such Securities rather than pay such Additional
Amounts (and the terms of any such option);
(24) with respect to any Securities that provide for optional
redemption or prepayment upon the occurrence of certain events (such
as a change of control of the Issuer), (i) the possible effects of
such provisions on the market price of the Issuer's securities or in
deterring certain mergers, tender offers or other takeover attempts,
and the intention of the Issuer to comply with the requirements of
Rule 14e-1 under the Exchange Act and any other applicable
securities laws in connection with such provisions; (ii) whether the
occurrence of the specified events may give rise to cross-defaults
on other indebtedness such that payment on such Securities may be
effectively subordinated; and (iii) the existence of any limitation
on the Issuer's financial or legal ability to repurchase such
Securities upon the occurrence of such an event (or, if true, the
lack of assurance that such a repurchase can be effected) and the
impact, if any, under the Indenture of such a failure, including
whether and under what circumstances such a failure may constitute
an Event of Default; and
(25) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture).
All Securities of any one series and all Coupons, if any,
appertaining to Bearer Securities of such series shall be substantially
identical except as to Currency of payments due thereunder, denomination and
the rate of interest, or method of determining the rate of interest, if any,
Maturity, and the date from which interest, if any, shall accrue and except as
may otherwise be provided by the Issuer in or pursuant to the Board Resolution
and set forth in the Officers' Certificate or in any indenture or indentures
supplemental hereto pertaining to such series of Securities. The terms of the
Securities of any series may provide, without limitation, that the Securities
shall be authenticated and delivered by the Trustee on original issue from
time to time upon telephonic or written order of persons designated in the
Officers' Certificate or supplemental indenture (telephonic instructions to be
promptly confirmed in writing by such person) and that such persons are
authorized to determine, consistent with such Officers' Certificate or any
applicable supplemental indenture, such terms and conditions of the Securities
of such series as are specified in such Officers' Certificate or supplemental
indenture. All Securities of any one series need not be issued at the same
time and, unless otherwise so provided by the Issuer, a series may be reopened
for issuances of additional Securities of such series or to establish
additional terms of such series of Securities.
If any of the terms of the Securities of any series shall be
established by action taken by or pursuant to a Board Resolution, the Board
Resolution shall be delivered to the Trustee at or prior to the delivery of
the Officers' Certificate setting forth the terms of such series.
Section 302. Currency; Denominations.
Unless otherwise provided in or pursuant to this Indenture, the
principal of, any premium and interest on and any Additional Amounts with
respect to the Securities shall be payable in Dollars. Unless otherwise
provided in or pursuant to this Indenture, Registered Securities denominated
in Dollars shall be issuable in registered form without Coupons in
denominations of $1,000 and any integral multiple thereof, and the Bearer
Securities denominated in Dollars shall be issuable in the denomination of
$5,000. Securities not denominated in Dollars shall be issuable in such
denominations as are established with respect to such Securities in or
pursuant to this Indenture.
Section 303. Execution, Authentication, Delivery and Dating.
Securities shall be executed by the Issuer's Chairman of the Board,
one of its Vice Chairmen, its President, its Treasurer or one of its Vice
Presidents under its corporate seal reproduced thereon and attested by its
Secretary or one of its Assistant Secretaries. Coupons shall be executed on
behalf of the Issuer by the Issuer's Treasurer or any Assistant Treasurer. The
signature of any of these officers on the Securities or any Coupons
appertaining thereto may be manual or facsimile.
Securities and any Coupons appertaining thereto bearing the manual
or facsimile signatures of individuals who were at any time the proper
officers of the Issuer shall bind the Issuer, 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 or Coupons.
At any time and from time to time after the execution and delivery
of this Indenture, the Issuer may deliver Securities, together with any
Coupons appertaining thereto, executed by the Issuer, to the Trustee for
authentication and, provided that the Board Resolution and Officers'
Certificate or supplemental indenture or indentures with respect to such
Securities referred to in Section 301 and an Issuer Order for the
authentication and delivery of such Securities have been delivered to the
Trustee, the Trustee in accordance with the Issuer Order and subject to the
provisions hereof and of such Securities shall authenticate and deliver such
Securities. In authenticating such Securities, and accepting the additional
responsibilities under this Indenture in relation to such Securities and any
Coupons appertaining thereto, the Trustee shall be entitled to receive, and
(subject to Sections 315(a) through 315(d) of the Trust Indenture Act) shall
be fully protected in relying upon,
(1) an Opinion of Counsel to the effect that:
(a) the form or forms and terms of such Securities and Coupons, if
any, have been established in conformity with the provisions of this
Indenture;
(b) all conditions precedent to the authentication and delivery of
such Securities and Coupons, if any, appertaining thereto, have been
complied with and that such Securities, and Coupons, when completed by
appropriate insertions, executed under the Issuer's corporate seal and
attested by duly authorized officers of the Issuer, delivered by duly
authorized officers of the Issuer to the Trustee for authentication
pursuant to this Indenture, and authenticated and delivered by the
Trustee and issued by the Issuer in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute legally
valid and binding obligations of the Issuer, enforceable against the
Issuer in accordance with their terms, except as enforcement thereof may
be subject to or limited by bankruptcy, insolvency, reorganization,
moratorium, arrangement, fraudulent conveyance, fraudulent transfer or
other similar laws relating to or affecting creditors' rights generally,
and subject to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law) and will
entitle the Holders thereof to the benefits of this Indenture; such
Opinion of Counsel need express no opinion as to the availability of
equitable remedies;
(c) all laws and requirements in respect of the execution and
delivery by the Issuer of such Securities and Coupons, if any, have been
complied with; and
(d) this Indenture has been qualified under the Trust Indenture Act;
and
(2) an Officers' Certificate stating that, to the best knowledge of
the Persons executing such certificate, no event which is, or after notice or
lapse of time would become, an Event of Default with respect to any of the
Securities shall have occurred and be continuing.
If all the Securities of any series are not to be issued at one
time, it shall not be necessary to deliver an Opinion of Counsel and an
Officers' Certificate at the time of issuance of each Security, but such
opinion and certificate, with appropriate modifications, shall be delivered at
or before the time of issuance of the first Security of such series. After any
such first delivery, any separate request by the Issuer that the Trustee
authenticate Securities of such series for original issue will be deemed to be
a certification by the Issuer that all conditions precedent provided for in
this Indenture relating to authentication and delivery of such Securities
continue to have been complied with.
The Trustee shall not be required to authenticate or to cause an
Authenticating Agent to authenticate any Securities if the issue of such
Securities pursuant to this Indenture will affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture or otherwise in a
manner which is not reasonably acceptable to the Trustee or if the Trustee,
being advised by counsel, determines that such action may not lawfully be
taken.
Each Registered Security shall be dated the date of its
authentication. Each Bearer Security and any Bearer Security in global form
shall be dated as of the date specified in or pursuant to this Indenture.
No Security or Coupon appertaining thereto 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 in Section 202 or 611 executed by or on behalf of the
Trustee or by the Authenticating Agent by the manual signature of one of its
authorized officers. Such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder. Except as permitted by Section 306 or
307, the Trustee shall not authenticate and deliver any Bearer Security unless
all Coupons appertaining thereto then matured have been detached and
cancelled.
Section 304. Temporary Securities.
Pending the preparation of definitive Securities, the Issuer may
execute and deliver to the Trustee and, upon Issuer Order, the Trustee shall
authenticate and deliver, in the manner provided in Section 303, temporary
Securities in lieu thereof 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, in registered form or, if authorized in or pursuant to this
Indenture, in bearer form with one or more Coupons or without Coupons and with
such appropriate insertions, omissions, substitutions and other variations as
the officers of the Issuer executing such Securities may determine, as
conclusively evidenced by their execution of such Securities. Such temporary
Securities may be in global form.
Except in the case of temporary Securities in global form, which
shall be exchanged in accordance with the provisions thereof, if temporary
Securities are issued, the Issuer shall cause definitive Securities to be
prepared without unreasonable delay. After the preparation of definitive
Securities of the same series and containing terms and provisions that are
identical to those of any temporary Securities, such temporary Securities
shall be exchangeable for such definitive Securities upon surrender of such
temporary Securities at an Office or Agency for such Securities, without
charge to any Holder thereof. Upon surrender for cancellation of any one or
more temporary Securities (accompanied by any unmatured Coupons appertaining
thereto), the Issuer shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Securities
of authorized denominations of the same series and containing identical terms
and provisions; provided, however, that no definitive Bearer Security, except
as provided in or pursuant to this Indenture, shall be delivered in exchange
for a temporary Registered Security; and provided, further, that a definitive
Bearer Security shall be delivered in exchange for a temporary Bearer Security
only in compliance with the conditions set forth in or pursuant to this
Indenture. Unless otherwise provided in or pursuant to this Indenture with
respect to a temporary global Security, 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.
Section 305. Registration, Transfer and Exchange.
With respect to the Registered Securities of each series, if any,
the Issuer shall cause to be kept a register (each such register being herein
sometimes referred to as the "Security Register") at an Office or Agency for
such series in which, subject to such reasonable regulations as it may
prescribe, the Issuer shall provide for the registration of the Registered
Securities of such series and of transfers of the Registered Securities of
such series. Such Office or Agency shall be the "Security Registrar" for that
series of Securities. Unless otherwise specified in or pursuant to this
Indenture or the Securities, the Trustee shall be the initial Security
Registrar for each series of Securities. The Issuer shall have the right to
remove and replace from time to time the Security Registrar for any series of
Securities; provided that no such removal or replacement shall be effective
until a successor Security Registrar with respect to such series of Securities
shall have been appointed by the Issuer and shall have accepted such
appointment by the Issuer. In the event that the Trustee shall not be or shall
cease to be Security Registrar with respect to a series of Securities, it
shall have the right to examine the Security Register for such series at all
reasonable times. There shall be only one Security Register for each series of
Securities.
Upon surrender for registration of transfer of any Registered
Security of any series at any Office or Agency for such series, the Issuer
shall execute, and the Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Registered
Securities of the same series denominated as authorized in or pursuant to this
Indenture, of a like aggregate principal amount bearing a number not
contemporaneously outstanding and containing identical terms and provisions.
At the option of the Holder, Registered Securities of any series may
be exchanged for other Registered Securities of the same series containing
identical terms and provisions, in any authorized denominations, and of a like
aggregate principal amount, upon surrender of the Securities to be exchanged
at any Office or Agency for such series. Whenever any Registered Securities
are so surrendered for exchange, the Issuer shall execute, and the Trustee
shall authenticate and deliver, the Registered Securities which the Holder
making the exchange is entitled to receive.
If provided in or pursuant to this Indenture, with respect to
Securities of any series, at the option of the Holder, Bearer Securities of
such series may be exchanged for Registered Securities of such series
containing identical terms, denominated as authorized in or pursuant to this
Indenture and in the same aggregate principal amount, upon surrender of the
Bearer Securities to be exchanged at any Office or Agency for such series,
with all unmatured Coupons and all matured Coupons in default thereto
appertaining. If the Holder of a Bearer Security is unable to produce any such
unmatured Coupon or Coupons or matured Coupon or Coupons in default, such
exchange may be effected if the Bearer Securities are accompanied by payment
in funds acceptable to the Issuer and the Trustee in an amount equal to the
face amount of such missing Coupon or Coupons, or the surrender of such
missing Coupon or Coupons may be waived by the Issuer and the Trustee if there
is furnished to them such security or indemnity as they may require to save
each of them and any Paying Agent harmless. If thereafter the Holder of such
Bearer Security shall surrender to any Paying Agent any such missing Coupon in
respect of which such a payment shall have been made, such Holder shall be
entitled to receive the amount of such payment; provided, however, that,
except as otherwise provided in Section 1002, interest represented by Coupons
shall be payable only upon presentation and surrender of those Coupons at an
Office or Agency for such series located outside the United States.
Notwithstanding the foregoing, in case a Bearer Security of any series is
surrendered at any such Office or Agency for such series in exchange for a
Registered Security of such series and like tenor after the close of business
at such Office or Agency on (i) any Regular Record Date and before the opening
of business at such Office or Agency on the relevant Interest Payment Date, or
(ii) any Special Record Date and before the opening of business at such Office
or Agency on the related date for payment of Defaulted Interest, such Bearer
Security shall be surrendered without the Coupon relating to such Interest
Payment Date or proposed date of payment, as the case may be (or, if such
Coupon is so surrendered with such Bearer Security, such Coupon shall be
returned to the Person so surrendering the Bearer Security), and interest or
Defaulted Interest, as the case may be, shall not be payable on such Interest
Payment Date or proposed date for payment, as the case may be, in respect of
the Registered Security issued in exchange for such Bearer Security, but shall
be payable only to the Holder of such Coupon when due in accordance with the
provisions of this Indenture.
If provided in or pursuant to this Indenture with respect to
Securities of any series, at the option of the Holder, Registered Securities
of such series may be exchanged for Bearer Securities upon such terms and
conditions as may be provided in or pursuant to this Indenture with respect to
such series.
Whenever any Securities are surrendered for exchange as contemplated
by the immediately preceding two paragraphs, the Issuer shall execute, and the
Trustee shall authenticate and deliver, the Securities which the Holder making
the exchange is entitled to receive.
Notwithstanding the foregoing, except as otherwise provided in or
pursuant to this Indenture, any global Security shall be exchangeable for
definitive Securities only if (i) the Depository is at any time unwilling,
unable or ineligible to continue as Depository and a successor depository is
not appointed by the Issuer within 90 days of the date the Issuer is so
informed in writing, (ii) the Issuer executes and delivers to the Trustee an
Issuer Order to the effect that such global Security shall be so exchangeable,
or (iii) an Event of Default has occurred and is continuing with respect to
the Securities. If the beneficial owners of interests in a global Security are
entitled to exchange such interests for definitive Securities as the result of
an event described in clause (i), (ii) or (iii) of the preceding sentence,
then without unnecessary delay but in any event not later than the earliest
date on which such interests may be so exchanged, the Issuer shall deliver to
the Trustee definitive Securities in such form and denominations as are
required by or pursuant to this Indenture, and of the same series, containing
identical terms and in aggregate principal amount equal to the principal
amount of such global Security, executed by the Issuer. On or after the
earliest date on which such interests may be so exchanged, such global
Security shall be surrendered from time to time by the U.S. Depository or such
other Depository as shall be specified in the Issuer Order with respect
thereto, and in accordance with instructions given to the Trustee and the U.S.
Depository or such other Depository, as the case may be (which instructions
shall be in writing but need not be contained in or accompanied by an
Officers' Certificate or be accompanied by an Opinion of Counsel), as shall be
specified in the Issuer Order with respect thereto to the Trustee, as the
Issuer's agent for such purpose, to be exchanged, in whole or in part, for
definitive Securities as described above without charge. The Trustee shall
authenticate and make available for delivery, in exchange for each portion of
such surrendered global Security, a like aggregate principal amount of
definitive Securities of the same series of authorized denominations and of
like tenor as the portion of such global Security to be exchanged, which
(unless such Securities are not issuable both as Bearer Securities and as
Registered Securities, in which case the definitive Securities exchanged for
the global Security shall be issuable only in the form in which the Securities
are issuable, as provided in or pursuant to this Indenture) shall be in the
form of Bearer Securities or Registered Securities, or any combination
thereof, as shall be specified by the beneficial owner thereof, but subject to
the satisfaction of any certification or other requirements to the issuance of
Bearer Securities; provided, however, that no such exchanges may occur during
a period beginning at the opening of business 15 days before any selection of
Securities of the same series to be redeemed and ending on the relevant
Redemption Date; and provided, further, that (unless otherwise provided in or
pursuant to this Indenture) no Bearer Security delivered in exchange for a
portion of a global Security shall be mailed or otherwise delivered to any
location in the United States. Promptly following any such exchange in part,
such global Security shall be returned by the Trustee to such Depository or
the U.S. Depository, as the case may be, or such other Depository or U.S.
Depository referred to above in accordance with the instructions of the Issuer
referred to above. If a Registered Security is issued in exchange for any
portion of a global Security after the close of business at the Office or
Agency for such Security where such exchange occurs on or after (i) any
Regular Record Date for such Security and before the opening of business at
such Office or Agency on the next Interest Payment Date, or (ii) any Special
Record Date for such Security and before the opening of business at such
Office or Agency on the related proposed date for payment of interest or
Defaulted Interest, as the case may be, interest shall not be payable on such
Interest Payment Date or proposed date for payment, as the case may be, in
respect of such Registered Security, but shall be payable on such Interest
Payment Date or proposed date for payment, as the case may be, only to the
Person to whom interest in respect of such portion of such global Security
shall be payable in accordance with the provisions of this Indenture.
All Securities issued upon any registration of transfer or exchange
of Securities shall be the valid obligations of the Issuer evidencing the same
debt and entitling the Holders thereof to the same benefits under this
Indenture as the Securities surrendered upon such registration of transfer or
exchange.
Every Registered Security presented or surrendered for registration
of transfer or for exchange or redemption shall (if so required by the Issuer
or the Security Registrar for such Security) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Issuer and the Security Registrar for such Security 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, or redemption of Securities, but the Issuer may require payment of a
sum sufficient to cover any tax or other governmental charge.
Except as otherwise provided in or pursuant to this Indenture, the
Issuer shall not be required (i) to issue, register the transfer of or
exchange any Securities during a period beginning at the opening of business
15 days before the day of the selection for redemption of Securities of like
tenor and the same series under Section 1103 and ending at the close of
business on the day of such selection, or (ii) to register the transfer of or
exchange any Registered Security so selected for redemption in whole or in
part, except in the case of any Security to be redeemed in part, the portion
thereof not to be redeemed, or (iii) to exchange any Bearer Security so
selected for redemption except, to the extent provided with respect to such
Bearer Security, that such Bearer Security may be exchanged for a Registered
Security of like tenor and the same series, provided that such Registered
Security shall be immediately surrendered for redemption with written
instruction for payment consistent with the provisions of this Indenture or
(iv) to issue, register the transfer of or exchange any Security which, in
accordance with its terms, has been surrendered for repayment at the option of
the Holder, except the portion, if any, of such Security not to be so repaid.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security or a Security with a mutilated Coupon
appertaining to it is surrendered to the Trustee, subject to the provisions of
this Section 306, the Issuer shall execute and the Trustee shall authenticate
and deliver in exchange therefor a new Security of the same series containing
identical terms and of like principal amount and bearing a number not
contemporaneously outstanding, with Coupons appertaining thereto corresponding
to the Coupons, if any, appertaining to the surrendered Security.
If there be delivered to the Issuer and to the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Security or
Coupon, and (ii) such security or indemnity as may be required by them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to the Issuer or the Trustee that such Security or Coupon has been
acquired by a bona fide purchaser, the Issuer shall execute and, upon the
Issuer's request the Trustee shall authenticate and deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Security or in
exchange for the Security to which a destroyed, lost or stolen Coupon
appertains with all appurtenant Coupons not destroyed, lost or stolen, a new
Security of the same series containing identical terms and of like principal
amount and bearing a number not contemporaneously outstanding, with Coupons
corresponding to the Coupons, if any, appertaining to such destroyed, lost or
stolen Security or to the Security to which such destroyed, lost or stolen
Coupon appertains.
Notwithstanding the foregoing provisions of this Section 306, in
case any mutilated, destroyed, lost or stolen Security or Coupon has become or
is about to become due and payable, the Issuer in its discretion may, instead
of issuing a new Security, pay such Security or Coupon; provided, however,
that payment of principal of, any premium or interest on or any Additional
Amounts with respect to any Bearer Securities shall, except as otherwise
provided in Section 1002, be payable only at an Office or Agency for such
Securities located outside the United States and, unless otherwise provided in
or pursuant to this Indenture, any interest on Bearer Securities and any
Additional Amounts with respect to such interest shall be payable only upon
presentation and surrender of the Coupons appertaining thereto.
Upon the issuance of any new Security under this Section, the Issuer
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 Trustee) connected therewith.
Every new Security, with any Coupons appertaining thereto issued
pursuant to this Section in lieu of any destroyed, lost or stolen Security, or
in exchange for a Security to which a destroyed, lost or stolen Coupon
appertains shall constitute a separate obligation of the Issuer, whether or
not the destroyed, lost or stolen Security and Coupons appertaining thereto or
the destroyed, lost or stolen Coupon shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally
and proportionately with any and all other Securities of such series and any
Coupons, if any, duly issued hereunder.
The provisions of this Section, as amended or supplemented pursuant
to this Indenture with respect to particular Securities or generally, shall be
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities or Coupons.
Section 307. Payment of Interest and Certain Additional Amounts;
Rights to Interest and Certain Additional Amounts Preserved.
Unless otherwise provided in or pursuant to this Indenture, any
interest on and any Additional Amounts with respect to any Registered Security
which shall be payable, and are punctually paid or duly provided for, on any
Interest Payment Date shall be paid to the Person in whose name such Security
(or one or more Predecessor Securities) is registered as of the close of
business on the Regular Record Date for such interest. Unless otherwise
provided in or pursuant to this Indenture, in case a Bearer Security is
surrendered in exchange for a Registered Security after the close of business
at an Office or Agency for such Security on any Regular Record Date therefor
and before the opening of business at such Office or Agency on the next
succeeding Interest Payment Date therefor, such Bearer Security shall be
surrendered without the Coupon relating to such Interest Payment Date and
interest shall not be payable on such Interest Payment Date in respect of the
Registered Security issued in exchange for such Bearer Security, but shall be
payable only to the Holder of such Coupon when due in accordance with the
provisions of this Indenture.
Unless otherwise provided in or pursuant to this Indenture, any
interest on and any Additional Amounts with respect to any Registered Security
which shall be payable, but shall not be punctually paid or duly provided for,
on any Interest Payment Date for such Registered Security (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holder
thereof on the relevant Regular Record Date by virtue of having been such
Holder; and such Defaulted Interest may be paid by the Issuer, at its election
in each case, as provided in Clause (1) or (2) below:
(1) The Issuer may elect to make payment of any Defaulted Interest
to the Person in whose name such Registered Security (or a Predecessor
Security thereof) shall be 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 Issuer shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be
paid on such Registered Security and the date of the proposed payment,
and at the same time the Issuer shall deposit with the Trustee an amount
of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit on or prior to the date of the proposed payment,
such money when so deposited to be held in trust for the benefit of the
Person entitled to such Defaulted Interest as in this Clause provided.
Thereupon, the Trustee shall fix a Special Record Date for the payment of
such Defaulted Interest which shall be not more than 15 days and not less
than 10 days prior to the date of the proposed payment and not less than
10 days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Issuer of such Special
Record Date and, in the name and at the expense of the Issuer 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 the
Holder of such Registered Security (or a Predecessor Security thereof) at
his address as it appears in the Security Register not less than 10 days
prior to such Special Record Date. The Trustee may, in its discretion, in
the name and at the expense of the Issuer, cause a similar notice to be
published at least once in an Authorized Newspaper of general circulation
in the Borough of Manhattan, The City of New York, but such publication
shall not be a condition precedent to the establishment of such Special
Record Date. Notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor having been mailed as aforesaid,
such Defaulted Interest shall be paid to the Person in whose name such
Registered Security (or a Predecessor Security thereof) shall be
registered at the close of business on such Special Record Date and shall
no longer be payable pursuant to the following clause (2). In case a
Bearer Security is surrendered at the Office or Agency for such Security
in exchange for a Registered Security after the close of business at such
Office or Agency on any Special Record Date and before the opening of
business at such Office or Agency on the related proposed date for
payment of Defaulted Interest, such Bearer Security shall be surrendered
without the Coupon relating to such Defaulted Interest and Defaulted
Interest shall not be payable on such proposed date of payment in respect
of the Registered Security issued in exchange for such Bearer Security,
but shall be payable only to the Holder of such Coupon when due in
accordance with the provisions of this Indenture.
(2) The Issuer may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which such Security may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the
Issuer to the Trustee of the proposed payment pursuant to this Clause,
such payment shall be deemed practicable by the Trustee.
Unless otherwise provided in or pursuant to this Indenture or the
Securities of any particular series pursuant to the provisions of this
Indenture, at the option of the Issuer, interest on Registered Securities that
bear interest may be paid by mailing a check to the address of the Person
entitled thereto as such address shall appear in the Security Register or by
transfer to an account maintained by the payee with a bank located in the
United States.
Subject to the foregoing provisions of this Section and Section 305,
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.
In the case of any Registered Security of any series that is
convertible, which Registered Security is converted after any Regular Record
Date and on or prior to the next succeeding Interest Payment Date (other than
any Registered Security with respect to which the Stated Maturity is prior to
such Interest Payment Date), interest with respect to which the 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 Registered Security (or one or more predecessor Registered
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 Registered Security which is converted, interest
with respect to which the Stated Maturity is after the date of conversion of
such Registered Security shall not be payable.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Registered Security for registration
of transfer, the Issuer, the Trustee and any agent of the Issuer or the
Trustee may treat the Person in whose name such Registered Security is
registered in the Security Register as the owner of such Registered Security
for the purpose of receiving payment of principal of, any premium and (subject
to Sections 305 and 307) interest on and any Additional Amounts with respect
to such Registered Security and for all other purposes whatsoever, whether or
not any payment with respect to such Registered Security shall be overdue, and
neither the Issuer, nor the Trustee or any agent of the Issuer or the Trustee
shall be affected by notice to the contrary.
The Issuer, the Trustee and any agent of the Issuer or the Trustee
may treat the bearer of any Bearer Security or the bearer of any Coupon as the
absolute owner of such Security or Coupon for the purpose of receiving payment
thereof or on account thereof and for all other purposes whatsoever, whether
or not any payment with respect to such Security or Coupon shall be overdue,
and neither the Issuer, nor the Trustee or any agent of the Issuer or the
Trustee shall be affected by notice to the contrary.
No Holder of any beneficial interest in any global Security held on
its behalf by a Depository shall have any rights under this Indenture with
respect to such global Security, and such Depository may be treated by the
Issuer, the Trustee, and any agent of the Issuer or the Trustee as the owner
of such global Security for all purposes whatsoever. None of the Issuer, the
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 a global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
Section 309. Cancellation.
All Securities and Coupons surrendered for payment, redemption,
registration of transfer or conversion or for credit against any sinking fund
payment shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee, and any such Securities and Coupons, as well as
Securities and Coupons surrendered directly to the Trustee for any such
purpose, shall be cancelled promptly by the Trustee. The Issuer may at any
time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Issuer may have acquired in
any manner whatsoever, and all Securities so delivered shall be cancelled
promptly by the Trustee. No Securities shall be authenticated in lieu of or in
exchange for any Securities cancelled as provided in this Section, except as
expressly permitted by or pursuant to this Indenture. All cancelled Securities
and Coupons held by the Trustee shall be disposed of by the Trustee in
accordance with its procedures in effect regarding the disposition of
cancelled Securities as of the date of such disposition, unless by an Issuer
Order the Issuer directs their return to it.
Section 310. Computation of Interest.
Except as otherwise provided in or pursuant to this Indenture or in
any Security, interest on the Securities shall be computed on the basis of a
360-day year of twelve 30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE OF INDENTURE
Section 401. Satisfaction and Discharge.
Upon the direction of the Issuer by an Issuer Order, this Indenture
shall cease to be of further effect with respect to any series of Securities
specified in such Issuer Order and any Coupons appertaining thereto, and the
Trustee, on receipt of an Issuer Order, at the expense of the Issuer, shall
execute proper instruments acknowledging satisfaction and discharge of this
Indenture as to such series, when
(1) either
(a) all Securities of such series theretofore authenticated and
delivered and all Coupons appertaining thereto (other than (i) Coupons
appertaining to Bearer Securities of such series surrendered in exchange
for Registered Securities of such series and maturing after such exchange
whose surrender is not required or has been waived as provided in Section
305, (ii) Securities and Coupons of such series which have been
destroyed, lost or stolen and which have been replaced or paid as
provided in Section 306, (iii) Coupons appertaining to Securities of such
series called for redemption and maturing after the relevant Redemption
Date whose surrender has been waived as provided in Section 1107, and
(iv) Securities and Coupons of such series for whose payment money has
theretofore been deposited in trust or segregated and held in trust by
the Issuer and thereafter repaid to the Issuer or discharged from such
trust, as provided in Section 1003) have been delivered to the Trustee
for cancellation; or
(b) all Securities of such series and, in the case of (i) or (ii)
below, any Coupons appertaining thereto not theretofore delivered to the
Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) if redeemable at the option of the Issuer, are to be
called for redemption within one year under arrangements satisfactory
to the Trustee for the giving of notice of redemption by the Trustee
in the name, and at the expense, of the Issuer,
and the Issuer, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds
in trust for such purpose, money in the Currency in which such
Securities are payable in an amount sufficient to pay and discharge
the entire indebtedness on such Securities and any Coupons
appertaining thereto not theretofore delivered to the Trustee for
cancellation, including the principal of, any premium and interest
on, and any Additional Amounts with respect to such Securities and
any Coupons appertaining thereto, to the date of such deposit (in the
case of Securities which have become due and payable) or to the
Maturity thereof, as the case may be;
(2) the Issuer has paid or caused to be paid all other sums payable
hereunder by the Issuer with respect to the Outstanding Securities of
such series and any Coupons appertaining thereto; and
(3) the Issuer has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture
as to such series have been complied with.
In the event there are Securities of two or more series hereunder,
the Trustee shall be required to execute an instrument acknowledging
satisfaction and discharge of this Indenture only if requested to do so with
respect to Securities of such series as to which it is Trustee and if the
other conditions thereto are met.
Notwithstanding the satisfaction and discharge of this Indenture
with respect to any series of Securities, the obligations of the Issuer to the
Trustee under Section 605 and, if money shall have been deposited with the
Trustee pursuant to subclause (b) of clause (1) of this Section, the
obligations of the Issuer and the Trustee with respect to the Securities of
such series under Sections 305, 306, 403, 1002 and 1003, with respect to the
payment of Additional Amounts, if any, with respect to such Securities as
contemplated by Section 1004 (but only to the extent that the Additional
Amounts payable with respect to such Securities exceed the amount deposited in
respect of such Additional Amounts pursuant to Section 401(1)(b)), and with
respect to any rights to exchange such Securities into other securities shall
survive.
Section 402. Defeasance and Covenant Defeasance.
(1) Unless pursuant to Section 301, either or both of (i) defeasance
of the Securities of or within a series under clause (2) of this Section 402
shall not be applicable with respect to the Securities of such series or (ii)
covenant defeasance of the Securities of or within a series under clause (3)
of this Section 402 shall not be applicable with respect to the Securities of
such series, then such provisions, together with the other provisions of this
Section 402 (with such modifications thereto as may be specified pursuant to
Section 301 with respect to any Securities), shall be applicable to such
Securities and any Coupons appertaining thereto, and the Issuer may at its
option by Board Resolution, at any time, with respect to such Securities and
any Coupons appertaining thereto, elect to have Section 402(2) or Section
402(3) be applied to such Outstanding Securities and any Coupons appertaining
thereto upon compliance with the conditions set forth below in this Section
402.
(2) Upon the Issuer's exercise of the above option applicable to
this Section 402(2) with respect to any Securities of or within a series, the
Issuer shall be deemed to have been discharged from its obligations with
respect to such Outstanding Securities and any Coupons appertaining thereto,
on the date the conditions set forth in clause (4) of this Section 402 are
satisfied (hereinafter, "defeasance"). For this purpose, such defeasance means
that the Issuer shall be deemed to have paid and discharged the entire
Indebtedness represented by such Outstanding Securities and any Coupons
appertaining thereto, which shall thereafter be deemed to be "Outstanding"
only for the purposes of clause (5) of this Section 402 and the other Sections
of this Indenture referred to in clauses (i) and (ii) below, and to have
satisfied all of its other obligations under such Securities and any Coupons
appertaining thereto, and this Indenture insofar as such Securities and any
Coupons appertaining thereto, are concerned (and the Trustee, at the expense
of the Issuer, shall execute proper instruments acknowledging the same),
except for the following which shall survive until otherwise terminated or
discharged hereunder: (i) the rights of Holders of such Outstanding Securities
and any Coupons appertaining thereto to receive, solely from the trust fund
described in clause (4) of this Section 402 and as more fully set forth in
such Section, payments in respect of the principal of (and premium, if any)
and interest, if any, on, and Additional Amounts, if any, with respect to,
such Securities and any Coupons appertaining thereto when such payments are
due, and any rights of such Holder to convert or exchange such Securities into
Common Stock or other securities, (ii) the obligations of the Issuer and the
Trustee with respect to such Securities under Sections 305, 306, 1002 and 1003
and with respect to the payment of Additional Amounts, if any, on such
Securities as contemplated by Section 1004 (but only to the extent that the
Additional Amounts payable with respect to such Securities exceed the amount
deposited in respect of such Additional Amounts pursuant to Section 401(4)(a)
below), and with respect to any rights to exchange such Securities into other
securities, (iii) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and (iv) this Section 402. The Issuer may exercise its
option under this Section 402(2) notwithstanding the prior exercise of its
option under clause (3) of this Section 402 with respect to such Securities
and any Coupons appertaining thereto.
(3) Upon the Issuer's exercise of the above option applicable to
this Section 402(3) with respect to any Securities of or within a series, the
Issuer shall be released from its obligations under Sections 1005 and 1006,
and to the extent specified pursuant to Section 301, any other covenant
applicable to such Securities, with respect to such Outstanding Securities and
any Coupons appertaining thereto, on and after the date the conditions set
forth in clause (4) of this Section 402 are satisfied (hereinafter, "covenant
defeasance"), and such Securities and any Coupons appertaining thereto shall
thereafter be deemed to be not "Outstanding" for the purposes of any
direction, waiver, consent or declaration or Act of Holders (and the
consequences of any thereof) in connection with any such covenant, but shall
continue to be deemed "Outstanding" for all other purposes hereunder. For this
purpose, such covenant defeasance means that, with respect to such Outstanding
Securities and any Coupons appertaining thereto, the Issuer 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 reference in any such
Section or such other covenant to any other provision herein or in any other
document and such omission to comply shall not constitute a default or an
Event of Default under Section 501(4) or 501(8) or otherwise, as the case may
be, but, except as specified above, the remainder of this Indenture and such
Securities and Coupons appertaining thereto shall be unaffected thereby.
(4) The following shall be the conditions to application of clause
(2) or (3) of this Section 402 to any Outstanding Securities of or within a
series and any Coupons appertaining thereto:
(a) The Issuer shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the
requirements of Section 607 who shall agree to comply with the provisions
of this Section 402 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 and any Coupons appertaining thereto, (1) an amount in Dollars
or in such Foreign Currency in which such Securities and any Coupons
appertaining thereto are then specified as payable at Stated Maturity, or
(2) Government Obligations applicable to such Securities and Coupons
appertaining thereto (determined on the basis of the Currency in which
such Securities and Coupons appertaining thereto are then specified as
payable at Stated Maturity) 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
of principal of (and premium, if any) and interest, if any, on such
Securities and any Coupons appertaining thereto, money in an amount, or
(3) a combination thereof, in any case, in an amount, sufficient, without
consideration of any reinvestment of such principal and interest, in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, to
pay and discharge, and which shall be applied by the Trustee (or other
qualifying trustee) to pay and discharge, (y) the principal of (and
premium, if any) and interest, if any, on such Outstanding Securities and
any Coupons appertaining thereto on the Stated Maturity of such principal
or installment of principal or interest and (z) any mandatory sinking
fund payments or analogous payments applicable to such Outstanding
Securities and any Coupons appertaining thereto on the day on which such
payments are due and payable in accordance with the terms of this
Indenture and of such Securities and any Coupons appertaining thereto.
(b) 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 instrument to which the Issuer is a party
or by which it is bound.
(c) No Event of Default or event which with notice or lapse of time
or both would become an Event of Default with respect to such Securities
and any Coupons appertaining thereto shall have occurred and be
continuing on the date of such deposit and, with respect to defeasance
only, at any time during the period ending on the 91st day after the date
of such deposit (it being understood that this condition shall not be
deemed satisfied until the expiration of such period).
(d) In the case of an election under clause (2) of this Section 402,
the Issuer shall have delivered to the Trustee an Opinion of Counsel
stating that (i) the Issuer has received from the Internal Revenue
Service a letter ruling, or there has been published by the Internal
Revenue Service a Revenue Ruling, or (ii) there has been a change in the
applicable Federal income tax law, in either case to the effect that, and
based thereon such opinion shall confirm that, the Holders of such
Outstanding Securities and any Coupons appertaining thereto will not
recognize income, gain or loss for Federal income tax purposes as a
result of such defeasance and will be subject to Federal income tax on
the same amounts, in the same manner and at the same times as would have
been the case if such defeasance had not occurred.
(e) In the case of an election under clause (3) of this Section 402,
the Issuer shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of such Outstanding Securities and any
Coupons appertaining thereto will not recognize income, gain or loss for
Federal income tax purposes as a result of such covenant defeasance and
will be subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such covenant
defeasance had not occurred.
(f) The Issuer shall have delivered to the Trustee an Officers'
Certificate (if applicable) and an Opinion of Counsel, each stating that
all conditions precedent to the defeasance or covenant defeasance under
clause (2) or (3) of this Section 402 (as the case may be) have been
complied with.
(g) Notwithstanding any other provisions of this Section 402(4),
such defeasance or covenant defeasance shall be effected in compliance
with any additional or substitute terms, conditions or limitations which
may be imposed on the Issuer in connection therewith pursuant to Section
301.
(5) Subject to the provisions of the last paragraph of Section 1003,
all money and Government Obligations (or other property as may be provided
pursuant to Section 301) (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this
Section 402(5) and Section 403, the "Trustee") pursuant to clause (4) of
Section 402 in respect of any Outstanding Securities of any series and any
Coupons appertaining thereto shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Securities and any Coupons
appertaining thereto and this Indenture, to the payment, either directly or
through any Paying Agent (including the Issuer acting as its own Paying Agent)
as the Trustee may determine, to the Holders of such Securities and any
Coupons appertaining thereto of all sums due and to become due thereon in
respect of principal (and premium, if any) and interest and Additional
Amounts, if any, but such money need not be segregated from other funds except
to the extent required by law.
Unless otherwise specified in or pursuant to this Indenture or any
Security, if, after a deposit referred to in Section 402(4)(a) has been made,
(a) the Holder of a Security in respect of which such deposit was made is
entitled to, and does, elect pursuant to Section 301 or the terms of such
Security to receive payment in a Currency other than that in which the deposit
pursuant to Section 402(4)(a) has been made in respect of such Security, or
(b) a Conversion Event occurs in respect of the Foreign Currency in which the
deposit pursuant to Section 402(4)(a) has been made, the indebtedness
represented by such Security and any Coupons appertaining thereto shall be
deemed to have been, and will be, fully discharged and satisfied through the
payment of the principal of (and premium, if any), and interest, if any, on,
and Additional Amounts, if any, with respect to, such Security as the same
becomes due out of the proceeds yielded by converting (from time to time as
specified below in the case of any such election) the amount or other property
deposited in respect of such Security into the Currency in which such Security
becomes payable as a result of such election or Conversion Event based on (x)
in the case of payments made pursuant to clause (a) above, the applicable
market exchange rate for such Currency in effect on the second Business Day
prior to each payment date, or (y) with respect to a Conversion Event, the
applicable market exchange rate for such Foreign Currency in effect (as nearly
as feasible) at the time of the Conversion Event.
The Issuer shall pay and indemnify the Trustee against any tax, fee
or other charge, imposed on or assessed against the Government Obligations
deposited pursuant to this Section 402 or the principal or interest received
in respect thereof other than any such tax, fee or other charge which by law
is for the account of the Holders of such Outstanding Securities and any
Coupons appertaining thereto.
Anything in this Section 402 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuer from time to time upon Issuer
Request, any money or Government Obligations (or other property and any
proceeds therefrom) held by it as provided in clause (4) of this Section 402
which, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee, are in excess of the amount thereof which would then be required to
be deposited to effect a defeasance or covenant defeasance, as applicable, in
accordance with this Section 402.
Section 403. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all
money and Government Obligations deposited with the Trustee pursuant to
Section 401 or 402 shall be held in trust and applied by it, in accordance
with the provisions of the Securities, the Coupons and this Indenture, to the
payment, either directly or through any Paying Agent (including the Issuer
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal, premium, interest and Additional Amounts
for whose payment such money has or Government Obligations have been deposited
with or received by the Trustee; but such money and Government Obligations
need not be segregated from other funds except to the extent required by law.
ARTICLE FIVE
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 such event is specifically deleted or modified in
or pursuant to the supplemental indenture, Board Resolution or Officers'
Certificate establishing the terms of such Series pursuant to this Indenture:
(1) default in the payment of any interest on or any Additional
Amounts payable in respect of any Security of such series when such interest
becomes or such Additional Amounts become 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 any premium on any
Security of such series when it becomes due and payable 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 such series; or
(4) default in the performance, or breach, of any covenant or
warranty of the Issuer in this Indenture or the Securities (other than a
covenant or warranty a default in the performance or the breach of which is
elsewhere in this Section specifically dealt with or which has been expressly
included in this Indenture solely for the benefit of a series of Securities
other than such series), 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 Issuer by the Trustee or to the Issuer and the Trustee by the Holders
of at least 25% in principal amount of the Outstanding Securities of such
series, a written notice specifying such default or breach and requiring it to
be remedied and stating that such notice is a "Notice of Default" hereunder;
or
(5) the entry by a court having competent jurisdiction of:
(a) a decree or order for relief in respect of the Issuer or any
"significant subsidiary" of the Issuer in Article 1, Section 1-02 of
Regulation S-X under the Securities Act of 1933, as amended ("Significant
Subsidiary") in an involuntary proceeding under any applicable
bankruptcy, insolvency, reorganization or other similar law and such
decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or
(b) a decree or order adjudging the Issuer or any Significant
Subsidiary to be insolvent, or approving a petition seeking
reorganization, arrangement, adjustment or composition of the Issuer or
any Significant Subsidiary and such decree or order shall remain unstayed
and in effect for a period of 60 consecutive days; or
(c) a final and non-appealable order appointing a custodian,
receiver, liquidator, assignee, trustee or other similar official of the
Issuer or any Significant Subsidiary or of any substantial part of the
property of the Issuer or ordering the winding up or liquidation of the
affairs of the Issuer or any Significant Subsidiary; or
(6) the commencement by the Issuer or any Significant Subsidiary of
a voluntary proceeding under any applicable bankruptcy, insolvency,
reorganization or other similar law or of a voluntary proceeding seeking to be
adjudicated insolvent or the consent by the Issuer or any Significant
Subsidiary to the entry of a decree or order for relief in an involuntary
proceeding under any applicable bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any insolvency proceedings against
it, or the filing by the Issuer or any Significant Subsidiary of a petition or
answer or consent seeking reorganization or relief under any applicable law,
or the consent by the Issuer or any Significant Subsidiary to the filing of
such petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee or similar official of the Issuer or
any Significant Subsidiary or any substantial part of the property of the
Issuer or any Significant Subsidiary or the making by the Issuer or any
Significant Subsidiary of an assignment for the benefit of creditors, or the
taking of corporate action by the Issuer or any Significant Subsidiary in
furtherance of any such action; or
(7) the Issuer, any Subsidiary in which the Issuer has invested at
least $20,000,000 in capital or any entity in which the Issuer is the general
partner shall fail to pay any principal of, premium or interest on or any
other amount payable in respect of, any recourse Indebtedness that is
outstanding in a principal or notional amount of at least $20,000,000 (or the
equivalent thereof in one or more other currencies), either individually or in
the aggregate (but excluding Indebtedness outstanding hereunder), of the
Issuer and its consolidated Subsidiaries, taken as a whole, when the same
becomes due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in any agreement or instrument
relating to such Indebtedness, or any other event shall occur or condition
shall exist under any agreement or instrument evidencing, securing or
otherwise relating to any such Indebtedness and shall continue after the
applicable grace period, if any, specified in such agreement or instrument, if
the effect of such event or condition is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness or otherwise to cause, or
to permit the holder or holders thereof ( or a trustee or agent on behalf of
such holders) to cause such Indebtedness to mature prior to its stated
maturity; or
(8) any other Event of Default provided in or pursuant to this
Indenture with respect to Securities of such series.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any series at
the time Outstanding (other than an Event of Default specified in clause (5)
or (6) of Section 501) occurs and is continuing, then the Trustee or the
Holders of not less than 25% in principal amount of the Outstanding Securities
of such series may declare the principal (or, if any Securities are Original
Issue Discount Securities or Indexed Securities, such portion of the principal
as may be specified in the terms thereof) of all the Securities of such
series, or such lesser amount as may be provided for in the Securities of such
series, to be due and payable immediately, by a notice in writing to the
Issuer (and to the Trustee if given by the Holders), and upon any such
declaration such principal or such lesser amount shall become immediately due
and payable.
If an Event of Default specified in clause (5) or (6) of Section 501
occurs, all unpaid principal of and accrued interest on the Outstanding
Securities of that series (or such lesser amount as may be provided for in the
Securities of such series) shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holder of any Security of that series.
At any time after Securities of any series have been accelerated and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article provided, the Holders of not less
than a majority in principal amount of the Outstanding Securities of such
series, by written notice to the Issuer and the Trustee, may rescind and annul
such declaration and its consequences if
(1) the Issuer has paid or deposited with the Trustee a sum of money
sufficient to pay
(a) all overdue installments of any interest on and Additional
Amounts with respect to all Securities of such series and any Coupon
appertaining thereto,
(b) the principal of and any premium on any Securities of such
series which have become due otherwise than by such declaration of
acceleration and interest thereon and any Additional Amounts with respect
thereto at the rate or rates borne by or provided for in such Securities,
(c) to the extent that payment of such interest or Additional
Amounts is lawful, interest upon overdue installments of any interest and
Additional Amounts at the rate or rates borne by or provided for in such
Securities, and
(d) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel and all other amounts due the Trustee
under Section 606; and
(2) all Events of Default with respect to Securities of such series,
other than the non-payment of the principal of, any premium and interest on,
and any Additional Amounts with respect to Securities of such series which
shall have become due solely by such declaration of acceleration, shall have
been cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Issuer covenants that if
(1) default is made in the payment of any installment of interest on
or any Additional Amounts with respect to any Security or any Coupon
appertaining thereto when such interest or Additional Amounts shall have
become 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 any
premium on any Security at its Maturity, the Issuer shall, upon demand of the
Trustee, pay to the Trustee, for the benefit of the Holders of such Securities
and any Coupons appertaining thereto, the whole amount of money then due and
payable with respect to such Securities and any Coupons appertaining thereto,
with interest upon the overdue principal, any premium and, to the extent that
payment of such interest shall be legally enforceable, upon any overdue
installments of interest and Additional Amounts at the rate or rates borne by
or provided for in such Securities, and, in addition thereto, such further
amount of money as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel and all other amounts due to
the Trustee under Section 606.
If the Issuer fails to pay the money it is required to pay the
Trustee pursuant to the preceding paragraph forthwith upon the demand of the
Trustee, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the money so due and
unpaid, and may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Issuer or any other obligor upon such Securities
and any Coupons appertaining thereto and collect the monies adjudged or
decreed to be payable in the manner provided by law out of the property of the
Issuer or any other obligor upon such Securities and any Coupons appertaining
thereto, wherever situated.
If an Event of Default with respect to Securities of any series
occurs and is continuing, the Trustee may in its discretion proceed to protect
and enforce its rights and the rights of the Holders of Securities of such
series and any Coupons appertaining thereto by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce
any such rights, whether for the specific enforcement of any covenant or
agreement in this Indenture or such Securities or in aid of the exercise of
any power granted herein or therein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition
or other judicial proceeding relative to the Issuer or any other obligor upon
the Securities or the property of the Issuer or such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the
Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Trustee shall have
made any demand on the Issuer for the payment of any overdue principal,
premium, interest or Additional Amounts) shall be entitled and empowered, by
intervention in such proceeding or otherwise,
(1) to file and prove a claim for the whole amount, or such
lesser amount as may be provided for in the Securities of such
series, of the principal and any premium, interest and Additional
Amounts owing and unpaid in respect of the Securities and any
Coupons appertaining thereto and to file such other papers or
documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee,
its agents or counsel) and of the Holders of Securities or any
Coupons allowed in such judicial proceeding, and
(2) to collect and receive any monies 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 of Securities or any Coupons to make such
payments to the Trustee and, in the event that the Trustee shall
consent to the making of such payments directly to the Holders of
Securities or any Coupons, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel and any other
amounts due the Trustee under Section 606.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a
Security or any Coupon any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or Coupons or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Holder of a Security or any Coupon in any such proceeding.
Section 505. Trustee May Enforce Claims without Possession of
Securities or Coupons.
All rights of action and claims under this Indenture or any of the
Securities or Coupons may be prosecuted and enforced by the Trustee without
the possession of any of the Securities or Coupons or the production thereof
in any proceeding relating thereto, and any such proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust, and
any recovery or judgment, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, shall be for the ratable benefit of each and every Holder of a
Security or Coupon in respect of which such judgment has been recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal, or any
premium, interest or Additional Amounts, upon presentation of the Securities
or Coupons, or both, as the case may be, 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 Trustee and any
predecessor Trustee under Section 606;
SECOND To the payment of the amounts then due and unpaid upon the
Securities and any Coupons for principal and any premium, interest
and Additional Amounts 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 aggregate amounts due and
payable on such Securities and Coupons for principal and any
premium, interest and Additional Amounts, respectively;
THIRD The balance, if any, to the Person or Persons entitled
thereto.
Section 507. Limitations on Suits.
No Holder of any Security of any series or any Coupons appertaining
thereto shall have any right to institute any proceeding, judicial or
otherwise, with respect to this Indenture, or for the appointment of a
receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the
Securities of such series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of such series shall have made written
request to the Trustee to institute proceedings in respect of such
Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to
be incurred in compliance with such request;
(4) the 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 Trustee during such 60-day period by the Holders
of a majority in principal amount of the Outstanding Securities of
such 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 or any
Security to affect, disturb or prejudice the rights of any other
such Holders or Holders of Securities of any other series, 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
such Holders.
Section 508. Unconditional Right of Holders to Receive Principal and
any Premium, Interest and Additional Amounts.
Notwithstanding any other provision in this Indenture, the Holder of
any Security or Coupon shall have the right, which is absolute and
unconditional, to receive payment of the principal of, any premium and
(subject to Sections 305 and 307) interest on, and any Additional Amounts with
respect to such Security or payment of such Coupon, as the case may be, on the
respective Stated Maturity or Maturities therefor specified in such Security
or Coupon (or, in the case of redemption, on the Redemption Date or, in the
case of repayment at the option of such Holder if provided in or pursuant to
this Indenture, on the date such repayment is due) and to institute suit for
the enforcement of any such payment, and such right shall not be impaired
without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder of a Security or a Coupon has
instituted any proceeding to enforce any right or remedy under this Indenture
and such proceeding has been discontinued or abandoned for any reason, or has
been determined adversely to the Trustee or to such Holder, then and in every
such case the Issuer, the Trustee and each such Holder shall, subject to any
determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of
the Trustee and each such Holder 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 or Coupons in the
last paragraph of Section 306, no right or remedy herein conferred upon or
reserved to the Trustee or to each and every Holder of a Security or a Coupon
is intended to be exclusive of any other right or remedy, and every right and
remedy, to the extent permitted by law, shall 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, to the extent permitted by law,
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 Trustee or of any Holder of any Security
or Coupon 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 Trustee or to any Holder of a Security or a Coupon
may be exercised from time to time, and as often as may be deemed expedient,
by the Trustee or by such Holder, as the case may be.
Section 512. Control by Holders of Securities.
The Holders of a majority in principal amount of the Outstanding
Securities of any series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee with respect to the
Securities of such series and any Coupons appertaining thereto, provided that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture or with the Securities of any series,
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction, and
(3) such direction is not unduly prejudicial to the rights of
the other Holders of Securities of such series not joining in such
action.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series on behalf of the Holders of all the
Securities of such series and any Coupons appertaining thereto may waive any
past default hereunder with respect to such series and its consequences,
except a default
(1) in the payment of the principal of, any premium or interest
on, or any Additional Amounts with respect to, any Security of such
series or any Coupons appertaining thereto, 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. Waiver of Stay or Extension Laws.
The Issuer covenants that (to the extent that it may lawfully do so)
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 Indenture; and the Issuer expressly waives (to the
extent that it may lawfully do so) all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution
of every such power as though no such law had been enacted.
Section 515. Undertaking for Costs
All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof 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 Indenture, or in any suit against the Trustee for any action
taken or omitted by it as Trustee, the filing by any party litigant in such
suit of any 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; but the
provisions of this Section 515 shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in principal amount of Outstanding Securities of
any series, or to any suit instituted by any Holder for the enforcement of the
payment of the principal of (or premium, if any) or interest, if any, on or
Additional Amounts, if any, with respect to any Security on or after the
respective Stated Maturities expressed in such Security (or, in the case of
redemption, on or after the Redemption Date, and, in the case of repayment, on
or after the date for repayment) or for the enforcement of the right, if any,
to convert or exchange any Security into Common Stock or other securities in
accordance with its terms.
ARTICLE SIX
THE TRUSTEE
Section 601. Certain Rights of Trustee.
Subject to Sections 315(a) through 315(d) of the Trust Indenture
Act:
(1) the Trustee 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, coupon or other paper or document
reasonably believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(2) any request or direction of the Issuer mentioned herein
shall be sufficiently evidenced by an Issuer Request or an Issuer
Order (other than delivery of any Security, together with any
Coupons appertaining thereto, to the Trustee for authentication and
delivery pursuant to Section 303 which shall be sufficiently
evidenced as provided therein) and any resolution of the Board of
Directors may be sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence shall be herein
specifically prescribed) may, in the absence of bad faith on its
part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel and the 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;
(5) the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by or pursuant to this Indenture
at the request or direction of any of the Holders of Securities of
any series or any Coupons appertaining thereto pursuant to this
Indenture, unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction;
(6) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, coupon or other paper or document,
but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine, during business
hours and upon reasonable notice, the books, records and premises of
the Issuer, personally or by agent or attorney;
(7) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder; and
(8) subject to the provisions of Section 602 hereof and
Sections 315(a) through 315(d) of the Trust Indenture Act, the
Trustee shall not be charged with knowledge of any Event of Default
described in Section 501(4), (5), (6), (7), or (8) hereof unless a
Responsible Officer of the Trustee shall have actual knowledge of
such Event of Default.
(9) the rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its
right to be indemnified, are extended to, and shall be enforceable
by, the Trustee in each of its capacities hereunder, and to each
agent, custodian and other Person employed to act hereunder.
Section 602. Notice of Defaults.
Within 90 days after the occurrence of any default hereunder with
respect to the Securities of any series, the Trustee shall transmit by mail to
all Holders of Securities of such series entitled to receive reports pursuant
to Section 703(3), notice of such default hereunder known to the Trustee,
unless such default shall have been cured or waived; provided, however, that,
except in the case of a default in the payment of the principal of (or
premium, if any), or interest, if any, on, or Additional Amounts or any
sinking fund or purchase fund installment with respect to, any Security of
such series, the Trustee shall be protected in withholding such notice if and
so long as the board of directors, the executive committee or a trust
committee of directors and/or Responsible Officers of the Trustee in good
faith determines that the withholding of such notice is in the best interest
of the Holders of Securities and Coupons of such series; and provided,
further, 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. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificate of authentication, and in any Coupons shall be taken as
the statements of the Issuer and neither the Trustee nor any Authenticating
Agent assumes any responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Securities or the Coupons, except that the Trustee represents that it is duly
authorized to execute and deliver this Indenture, authenticate the Securities
and perform its obligations hereunder and that the statements made by it in a
Statement of Eligibility on Form T-1 supplied to the Issuer are true and
accurate, subject to the qualifications set forth therein. Neither the Trustee
nor any Authenticating Agent shall be accountable for the use or application
by the Issuer of the Securities or the proceeds thereof.
Section 604. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other Person that may be an agent of the Trustee or
the Issuer, in its individual or any other capacity, may become the owner or
pledgee of Securities or Coupons and, subject to Sections 310(b) and 311 of
the Trust Indenture Act, may otherwise deal with the Issuer with the same
rights it would have if it were not Trustee, Authenticating Agent, Paying
Agent, Security Registrar or such other Person.
Section 605. Money Held in Trust.
Except as provided in Section 403 and Section 1003, money held by
the Trustee in trust hereunder need not be segregated from other funds except
to the extent required by law and shall be held uninvested. The Trustee shall
be under no liability for interest on any money received by it hereunder
except as otherwise agreed in writing with the Issuer.
Section 606. Compensation and Reimbursement.
The Issuer agrees:
(1) to pay to the Trustee from time to time such compensation
as the Issuer and the Trustee shall from time to time agree in
writing for all services rendered by the Trustee 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 Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the 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 the Trustee's negligence or bad
faith; and
(3) to indemnify the Trustee and its agents for, and to hold
them harmless against, any loss, liability or expense incurred
without negligence or bad faith on their 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
themselves against any claim or liability in connection with the
exercise or performance of any of their powers or duties hereunder,
except to the extent that any such loss, liability or expense was
due to the Trustee's negligence or bad faith.
As security for the performance of the obligations of the Issuer
under this Section, the Trustee shall have a Lien prior to the Securities of
any series upon all property and funds held or collected by the Trustee as
such, except funds held in trust for the payment of principal of, and premium
or interest on or any Additional Amounts with respect to Securities or any
Coupons appertaining thereto.
Any compensation or expense incurred by the Trustee after a default
specified by Section 501 is intended to constitute an expense of
administration under any then applicable bankruptcy or insolvency law.
"Trustee" for purposes of this Section 606 shall include any predecessor
Trustee but the negligence or bad faith of any Trustee shall not affect the
rights of any other Trustee under this Section 606.
The provisions of this section shall survive the termination of this
Indenture.
Section 607. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder that is a
Corporation, organized and doing business under the laws of the United States
of America, any state thereof or the District of Columbia, eligible under
Section 310(a)(1) of the Trust Indenture Act to act as trustee under an
indenture qualified under the Trust Indenture Act and that has a combined
capital and surplus (computed in accordance with Section 310(a)(2) of the
Trust Indenture Act) of at least $50,000,000 subject to supervision or
examination by Federal or state authority. If at any time the Trustee shall
cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter
specified in this Article.
Section 608. Resignation and Removal; Appointment of Successor.
(1) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee pursuant to Section 609.
(2) The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Issuer. If the instrument of acceptance by a successor Trustee required by
Section 609 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to such series.
(3) The 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 Trustee
and the Issuer.
(4) If at any time:
(a) the Trustee shall fail to comply with the obligations
imposed upon it under Section 310(b) of the Trust Indenture Act with
respect to Securities of any series after written request therefor
by the Issuer or any Holder of a Security of such series who has
been a bona fide Holder of a Security of such series for at least
six months, or
(b) the Trustee shall cease to be eligible under Section 607
and shall fail to resign after written request therefor by the
Issuer or any such Holder, or
(c) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation, then, in
any such case, (i) the Issuer, by or pursuant to a Board Resolution,
may remove the Trustee with respect to all Securities or the
Securities of such series, or (ii) subject to Section 315(e) of the
Trust Indenture Act, any Holder of a Security 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 removal of the
Trustee with respect to all Securities of such series and the
appointment of a successor Trustee or Trustees.
(5) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause,
with respect to the Securities of one or more series, the Issuer, by or
pursuant to a Board Resolution, shall promptly appoint a successor Trustee or
Trustees with respect to the Securities of that or those series (it being
understood that any such successor Trustee may be appointed with respect to
the Securities of one or more or all of such series and that at any time there
shall be only one Trustee with respect to the Securities of any particular
series) and shall comply with the applicable requirements of Section 609. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee with respect to the Securities
of any series shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Securities of such series delivered to the
Issuer and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 609, become the successor Trustee with
respect to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Issuer. If no successor Trustee with
respect to the Securities of any series shall have been so appointed by the
Issuer or the Holders of Securities and accepted appointment in the manner
required by Section 609, any Holder of a Security who has been a bona fide
Holder of a Security of such series for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
(6) The Issuer shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any
series by mailing written notice of such event by first-class mail, postage
prepaid, to the Holders of Registered Securities, if any, of such series as
their names and addresses appear in the Security Register and, if Securities
of such series are issued as Bearer Securities, by publishing notice of such
event once in an Authorized Newspaper in each Place of Payment located outside
the United States. Each notice shall include the name of the successor Trustee
with respect to the Securities of such series and the address of its Corporate
Trust Office.
Section 609. Acceptance of Appointment by Successor.
(1) Upon the appointment hereunder of any successor Trustee with
respect to all Securities, such successor Trustee so appointed shall execute,
acknowledge and deliver to the Issuer and the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without
any further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties hereunder of the retiring Trustee; but, on the
request of the Issuer or such successor Trustee, such retiring Trustee, upon
payment of its charges, shall execute and deliver an instrument transferring
to such successor Trustee all the rights, powers and trusts of the retiring
Trustee and, subject to Section 1003, shall duly assign, transfer and deliver
to such successor Trustee all property and money held by such retiring Trustee
hereunder, subject nevertheless to its claim, if any, provided for in Section
606.
(2) Upon the appointment hereunder of any successor Trustee with
respect to the Securities of one or more (but not all) series, the Issuer, the
retiring Trustee and such successor Trustee shall execute and deliver an
indenture supplemental hereto wherein each successor 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, such successor
Trustee all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series to which the appointment of
such successor Trustee relates, (2) if the retiring Trustee is not retiring
with respect to all Securities, shall contain such provisions as shall be
deemed necessary or desirable to confirm that all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Securities of that or
those series as to which the retiring Trustee is not retiring shall continue
to be vested in the retiring Trustee, and (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
Trustee, it being understood that nothing herein or in such supplemental
indenture shall constitute such Trustees co-trustees of the same trust, that
each such Trustee shall be trustee of a trust or trusts hereunder separate and
apart from any trust or trusts hereunder administered by any other such
Trustee and that no Trustee shall be responsible for any notice given to, or
received by, or any act or failure to act on the part of any other Trustee
hereunder, and, upon the execution and delivery of such supplemental
indenture, the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein, such retiring Trustee shall have no
further responsibility for the exercise of rights and powers or for the
performance of the duties and obligations vested in the Trustee under this
Indenture with respect to the Securities of that or those series to which the
appointment of such successor Trustee relates other than as hereinafter
expressly set forth, and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates; but, on
request of the Issuer or such successor Trustee, such retiring Trustee, upon
payment of its charges with respect to the Securities of that or those series
to which the appointment of such successor relates and subject to Section 1003
shall duly assign, transfer and deliver to such successor Trustee, to the
extent contemplated by such supplemental indenture, the property and money
held by such retiring Trustee hereunder with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates,
subject to its claim, if any, provided for in Section 606.
(3) Upon request of any Person appointed hereunder as a successor
Trustee, the Issuer shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor Trustee all such rights,
powers and trusts referred to in paragraph (1) or (2) of this Section, as the
case may be.
(4) No Person shall accept its appointment hereunder as a successor
Trustee unless at the time of such acceptance such successor Person shall be
qualified and eligible under this Article.
Section 610. Merger, Conversion, Consolidation or Succession to
Business.
Any Corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any Corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any Corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been
authenticated but not delivered by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may
adopt such authentication and deliver the Securities so authenticated with the
same effect as if such successor Trustee had itself authenticated such
Securities.
Section 611. Appointment of Authenticating Agent.
The Trustee may appoint one or more Authenticating Agents acceptable
to the Issuer with respect to one or more series of Securities which shall be
authorized to act on behalf of the Trustee to authenticate Securities of that
or those series issued upon original issue, exchange, registration of
transfer, partial redemption or partial repayment 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 Trustee hereunder. Wherever reference is made in this
Indenture to the authentication and delivery of Securities by the Trustee or
the Trustee's certificate of authentication, such reference shall be deemed to
include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Issuer and,
except as provided in or pursuant to this Indenture, shall at all times be a
corporation that would be permitted by the Trust Indenture Act to act as
trustee under an indenture qualified under the Trust Indenture Act, is
authorized under applicable law and by its charter to act as an Authenticating
Agent and has a combined capital and surplus (computed in accordance with
Section 310(a)(2) of the Trust Indenture Act) of at least $50,000,000. If at
any time an Authenticating 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 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 of the corporate agency or corporate trust business of an Authenticating
Agent, shall be the successor of such Authenticating Agent hereunder, 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 Trustee
or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and the Issuer. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and the Issuer. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Issuer and shall (i) mail written
notice of such appointment by first-class mail, postage prepaid, to all
Holders of Registered Securities, if any, of the series with respect to which
such Authenticating Agent shall serve, as their names and addresses appear in
the Security Register, and (ii) if Securities of the series are issued as
Bearer Securities, publish notice of such appointment at least once in an
Authorized Newspaper in the place where such successor Authenticating Agent
has its principal office if such office is located outside the United States.
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 Issuer agrees to pay each Authenticating Agent from time to time
reasonable compensation for its services under this Section. If the Trustee
makes such payments, it shall be entitled to be reimbursed for such payments,
subject to the provisions of Section 606.
The provisions of Sections 308, 603 and 604 shall be applicable to
each Authenticating Agent.
If an Authenticating Agent is appointed with respect to one or more
series of Securities pursuant to this Section, the Securities of such series
may have endorsed thereon, in addition to or in lieu of the Trustee's
certificate of authentication, an alternate certificate of authentication in
substantially the following form:
This is one of the Securities of the series designated herein
referred to in the within-mentioned Indenture.
____________________________________,
As Trustee
By_______________________
As Authenticating Agent
By_______________________
Authorized Signatory
If all of the Securities of any series may not be originally issued
at one time, and if the Trustee does not have an office capable of
authenticating Securities upon original issuance located in a Place of Payment
where the Issuer wishes to have Securities of such series authenticated upon
original issuance, the Trustee, if so requested in writing (which writing need
not be accompanied by or contained in an Officers' Certificate by the Issuer),
shall appoint in accordance with this Section an Authenticating Agent having
an office in a Place of Payment designated by the Issuer with respect to such
series of Securities.
ARTICLE SEVEN
HOLDERS LISTS AND REPORTS BY TRUSTEE AND ISSUER
Section 701. Issuer to Furnish Trustee Names and Addresses of
Holders.
In accordance with Section 312(a) of the Trust Indenture Act, the
Issuer shall furnish or cause to be furnished to the Trustee
(1) semi-annually with respect to Securities of each series, a list,
in each case in such form as the Trustee may reasonably require, of the names
and addresses of Holders as of the applicable date, and
(2) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Issuer of any such request, a list of
similar form and content as of a date not more than 15 days prior to the time
such list is furnished,
provided, however, that 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.
The Trustee shall comply with the obligations imposed upon it
pursuant to Section 312 of the Trust Indenture Act.
Every Holder of Securities or Coupons, by receiving and holding the
same, agrees with the Issuer and the Trustee that neither the Issuer, the
Trustee, any Paying Agent or any Security Registrar shall be held accountable
by reason of the disclosure of any such information as to the names and
addresses of the Holders of Securities in accordance with Section 312(c) of
the Trust Indenture Act, regardless of the source from which such information
was derived, and that the Trustee shall not be held accountable by reason of
mailing any material pursuant to a request made under Section 312(b) of the
Trust Indenture Act.
Section 703. Reports by Trustee.
(1) Within 60 days after September 15 of each year commencing with
the first September 15 following the first issuance of Securities pursuant to
Section 301, if required by Section 313(a) of the Trust Indenture Act, the
Trustee shall transmit, pursuant to Section 313(c) of the Trust Indenture Act,
a brief report dated as of such September 15 with respect to any of the events
specified in said Section 313(a) which may have occurred since the later of
the immediately preceding September 15 and the date of this Indenture.
(2) The Trustee shall transmit the reports required by Section
313(a) of the Trust Indenture Act at the times specified therein.
(3) Reports pursuant to this Section shall be transmitted in the
manner and to the Persons required by Sections 313(c) and 313(d) of the Trust
Indenture Act.
Section 704. Reports by Issuer.
The Issuer, pursuant to Section 314(a) of the Trust Indenture Act,
shall:
(1) file with the Trustee, within 15 days after the Issuer is
required to file the same with the Commission, copies of the annual reports
and of the information, documents and other reports (or copies of such
portions of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Issuer may be required to file with
the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act;
or, if the Issuer is not required to file information, documents or reports
pursuant to either of said Sections, then it shall file with the Trustee and
the Commission, in accordance with rules and regulations prescribed from time
to time by the Commission, such of the supplementary and periodic information,
documents and reports which may be required pursuant to Section 13 of the
Exchange Act in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in such rules and
regulations;
(2) file with the Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance by
the Issuer with the conditions and covenants of this Indenture as may be
required from time to time by such rules and regulations; and
(3) transmit within 30 days after the filing thereof with the
Trustee, in the manner and to the extent provided in Section 313(c) of the
Trust Indenture Act, such summaries of any information, documents and reports
required to be filed by the Issuer pursuant to paragraphs (1) and (2) of this
Section as may be required by rules and regulations prescribed from time to
time by the Commission.
Delivery of such reports, information and documents to the Trustee
is for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
ARTICLE EIGHT
CONSOLIDATION, MERGER AND SALES
Section 801. Issuer May Consolidate, Etc., Only on Certain Terms.
Nothing contained in this Indenture or in any of the Securities
shall prevent any consolidation or merger of the Issuer with or into any other
Person or Persons (whether or not affiliated with the Issuer), or successive
consolidations or mergers in which either the Issuer will be the continuing
entity or the Issuer or its successor or successors shall be a party or
parties, or shall prevent any conveyance, transfer or lease of all or
substantially all of the property of the Issuer, to any other Person (whether
or not affiliated with the Issuer); provided, however, that:
(1) in case the Issuer shall consolidate with or merge into another
Person or convey, transfer or lease all or substantially all of its properties
and assets to any Person, the entity formed by such consolidation or into
which the Issuer is merged or the Person which acquires by conveyance or
transfer, or which leases, all or substantially all of the properties of the
Issuer shall be a Person organized and 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 (or indentures, if at such time there is
more than one Trustee) supplemental hereto, executed by the successor Person
and delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of the principal of, any premium and interest on and any
Additional Amounts with respect to all the Securities and the performance of
every obligation in this Indenture and the Outstanding Securities on the part
of the Issuer to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default or event which, after notice or lapse of time, or both, would become
an Event of Default, shall have occurred and be continuing; and
(3) either the Issuer or the successor Person shall have delivered
to the Trustee an Officers' Certificate and an Opinion of Counsel, each
stating that such consolidation, merger, conveyance, transfer or lease and, if
a supplemental indenture is required in connection with such transaction, such
supplemental indenture comply with this Article and that all conditions
precedent herein provided for relating to such transaction have been complied
with.
Section 802. Successor Person Substituted for Issuer.
Upon any consolidation by the Issuer with or merger of the Issuer
into any other Person or any conveyance, transfer or lease of all or
substantially all of the properties and assets of the Issuer to any Person in
accordance with Section 801, the successor Person formed by such consolidation
or into which the Issuer 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 Issuer under this Indenture with the same effect as if
such successor Person had been named as the Issuer herein; and thereafter,
except in the case of a lease, the predecessor Person shall be released from
all obligations and covenants under this Indenture, the Securities and the
Coupons.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures without Consent of Holders.
Without the consent of any Holders of Securities or Coupons, the
Issuer (when authorized by or pursuant to a Board Resolution) and the Trustee,
at any time and from time to time, may enter into one or more indentures
supplemental hereto, in form satisfactory to the Trustee, for any of the
following purposes:
(1) to evidence the succession of another Person to the Issuer, and
the assumption by any such successor of the covenants of the Issuer contained
herein and in the Securities; or
(2) to add to the covenants of the Issuer for the benefit of the
Holders of all or any series of Securities (as shall be specified in such
supplemental indenture or indentures) or to surrender any right or power
herein conferred upon the Issuer; or
(3) to add any additional Events of Default with respect to all or
any series of Securities (as shall be specified in such supplemental
indenture); or
(4) to add to or change any of the provisions of this Indenture to
provide that Bearer Securities may be registrable as to principal, to change
or eliminate any restrictions on the payment of principal of, any premium or
interest on or any Additional Amounts with respect to Securities, to permit
Bearer Securities to be issued in exchange for Registered Securities, to
permit Bearer Securities to be exchanged for Bearer Securities of other
authorized denominations or to permit or facilitate the issuance of Securities
in uncertificated form, provided any such action shall not adversely affect
the interests of the Holders of Securities of any series or any Coupons
appertaining thereto in any material respect; or
(5) to add to, delete from or revise the conditions, limitations and
restrictions on the authorized amount, terms or purposes of issue,
authentication and delivery of Securities, as herein set forth; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series and
any Coupons appertaining thereto as permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or more
series and to add to or change any of the provisions of this Indenture as
shall be necessary to provide for or facilitate the administration of the
trusts hereunder by more than one Trustee, pursuant to the requirements of
Section 609; or
(9) to cure any ambiguity or 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 which shall not adversely affect the interests of the
Holders of Securities of any series then Outstanding or any Coupons
appertaining thereto in any material respect; or
(10) to supplement any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the defeasance and
discharge of any series of Securities pursuant to Article Four, provided that
any such action shall not adversely affect the interests of any Holder of a
Security of such series and any Coupons appertaining thereto or any other
Security or Coupon in any material respect; or
(11) to amend or supplement any provision contained herein or in any
supplemental indenture, provided that no such amendment or supplement shall
materially adversely affect the interests of the Holders of any Securities
then Outstanding.
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 affected by such
supplemental indenture, by Act of said Holders delivered to the Issuer and the
Trustee, the Issuer (when authorized by or pursuant to an Issuer's Board
Resolution), and the 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 or of the Securities of such series; provided, however,
that no such supplemental indenture, without the consent of the Holder of each
Outstanding Security affected thereby, shall
(1) change the Stated Maturity of the principal of, or any premium
or installment of interest on or any Additional Amounts with respect to, any
Security, or reduce the principal amount thereof or the rate (or modify the
calculation of such rate) of interest thereon or any Additional Amounts with
respect thereto, or any premium payable upon the redemption thereof or
otherwise, or change the obligation of the Issuer to pay Additional Amounts
pursuant to Section 1004 (except as contemplated by Section 801(1) and
permitted by Section 901(1)), 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
the amount thereof provable in bankruptcy pursuant to Section 504, change the
redemption provisions or adversely affect the right of repayment at the option
of any Holder as contemplated by Article Thirteen, or change the Place of
Payment, Currency in which the principal of, any premium or interest on, or
any Additional Amounts with respect to any Security 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, in the case of repayment at the option of the Holder, on
or after the date for repayment or in the case of change in control), 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
reduce the requirements of Section 1504 for quorum or voting, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1007, except to increase any such percentage 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.
A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture which shall have been included expressly and
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 of Securities 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.
As a condition to executing, or accepting the additional trusts
created by, any supplemental indenture permitted by this Article or the
modifications thereby of the trust created by this Indenture, the Trustee
shall be entitled to receive, and (subject to Section 315 of the Trust
Indenture Act) shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such supplemental indenture is authorized or
permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture which affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
Section 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 a Security theretofore or thereafter authenticated and
delivered hereunder and of any Coupon appertaining thereto shall be bound
thereby.
Section 905. 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 Trustee, bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Issuer shall so determine, new Securities of any series so modified as to
conform, in the opinion of the Trustee and the Issuer, to any such
supplemental indenture may be prepared and executed by the Issuer and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities of such series.
Section 906. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal, any Premium, Interest and
Additional Amounts.
The Issuer covenants and agrees for the benefit of the Holders of
the Securities of each series that it will duly and punctually pay the
principal of, any premium and interest on and any Additional Amounts with
respect to the Securities of such series in accordance with the terms thereof,
any Coupons appertaining thereto and this Indenture. Any interest due on any
Bearer Security on or before the Maturity thereof, and any Additional Amounts
payable with respect to such interest, shall be payable only upon presentation
and surrender of the Coupons appertaining thereto for such interest as they
severally mature.
Section 1002. Maintenance of Office or Agency.
The Issuer shall maintain in each Place of Payment for any series of
Securities an Office or Agency where Securities of such series (but not Bearer
Securities, except as otherwise provided below, unless such Place of Payment
is located outside the United States) may be presented or surrendered for
payment, where Securities of such series may be surrendered for registration
of transfer or exchange, and where notices and demands to or upon the Issuer
in respect of the Securities of such series relating thereto and this
Indenture may be served. If Securities of a series are issuable as Bearer
Securities, the Issuer shall maintain, subject to any laws or regulations
applicable thereto, an Office or Agency in a Place of Payment for such series
which is located outside the United States where Securities of such series and
any Coupons appertaining thereto may be presented and surrendered for payment;
provided, however, that if the Securities of such series are listed on The
Stock Exchange of the United Kingdom and the Republic of Ireland or the
Luxembourg Stock Exchange or any other stock exchange located outside the
United States and such stock exchange shall so require, the Issuer shall
maintain a Paying Agent in London, Luxembourg or any other required city
located outside the United States, as the case may be, so long as the
Securities of such series are listed on such exchange. The Issuer will give
prompt written notice to the Trustee of the location, and any change in the
location, of such Office or Agency. If at any time the Issuer shall fail to
maintain any such required Office or Agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee,
except that Bearer Securities of such series and any Coupons appertaining
thereto may be presented and surrendered for payment at the place specified
for the purpose with respect to such Securities as provided in or pursuant to
this Indenture, and the Issuer hereby appoints the Trustee as its agent to
receive all such presentations, surrenders, notices and demands.
Except as otherwise provided in or pursuant to this Indenture, no
payment of principal, premium, interest or Additional Amounts with respect to
Bearer Securities shall be made at any Office or Agency in the United States
or by check mailed to any address in the United States or by transfer to an
account maintained with a bank located in the United States; provided,
however, if amounts owing with respect to any Bearer Securities shall be
payable in Dollars, payment of principal of, any premium or interest on and
any Additional Amounts with respect to any such Security may be made at the
Corporate Trust Office of the Trustee or any Office or Agency designated by
the Issuer in the City of New York, New York, if (but only if) payment of the
full amount of such principal, premium, interest or Additional Amounts at all
offices outside the United States maintained for such purpose by the Issuer in
accordance with this Indenture is illegal or effectively precluded by exchange
controls or other similar restrictions.
The Issuer 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 Issuer of its obligation to
maintain an Office or Agency in each Place of Payment for Securities of any
series for such purposes. The Issuer shall give prompt written notice to the
Trustee of any such designation or rescission and of any change in the
location of any such other Office or Agency. Unless otherwise provided in or
pursuant to this Indenture, the Issuer hereby designates as the Place of
Payment for each series of Securities the City of New York, New York, and
initially appoints the office of _________________ as the Office or Agency of
the Issuer, in the City of New York, New York for such purpose. The Issuer may
subsequently appoint a different Office or Agency in the City of New York, New
York for the Securities of any series.
Unless otherwise specified with respect to any Securities pursuant
to Section 301, if and so long as the Securities of any series (i) are
denominated in a Foreign Currency or (ii) may be payable in a Foreign
Currency, or so long as it is required under any other provision of this
Indenture, then the Issuer will maintain with respect to each such series of
Securities, or as so required, at least one exchange rate agent.
Section 1003. Money for Securities Payments to Be Held in Trust.
If the Issuer shall at any time act as its own Paying Agent with
respect to any series of Securities, it shall, on or before each due date of
the principal of, any premium or interest on or Additional Amounts with
respect to any of the Securities of such series, segregate and hold in trust
for the benefit of the Persons entitled thereto a sum in the currency or
currencies, currency unit or units or composite 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 principal or any premium, interest or Additional Amounts so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as
herein provided, and shall promptly notify the Trustee of its action or
failure so to act.
Whenever the Issuer shall have one or more Paying Agents for any
series of Securities, it shall, on or prior to each due date of the principal
of, any premium or interest on or any Additional Amounts with respect to any
Securities of such series, deposit with any Paying Agent a sum (in the
currency or currencies, currency unit or units or composite currency or
currencies described in the preceding paragraph) sufficient to pay the
principal or any premium, interest or Additional Amounts so becoming due, such
sum to be held in trust for the benefit of the Persons entitled thereto, and
(unless such Paying Agent is the Trustee) the Issuer will promptly notify the
Trustee of its action or failure so to act.
The Issuer shall cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent shall:
(1) hold all sums held by it for the payment of the principal of,
any premium or interest on or any Additional Amounts with respect to
Securities of such 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 provided in or pursuant to this Indenture;
(2) give the Trustee notice of any default by the Issuer (or any
other obligor upon the Securities of such series) in the making of any payment
of principal, any premium or interest on or any Additional Amounts with
respect to the Securities of such series; and
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held
in trust by such Paying Agent.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Issuer Order, direct any Paying Agent to pay, to the Trustee all sums held
in trust by the Issuer or such Paying Agent, such sums to be held by the
Trustee upon the same terms as those upon which such sums were held by the
Issuer or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such sums.
Except as otherwise provided herein or pursuant hereto, any money
deposited with the Trustee or any Paying Agent, or then held by the Issuer, in
trust for the payment of the principal of, any premium or interest on or any
Additional Amounts with respect to any Security of any series or any Coupon
appertaining thereto and remaining unclaimed for two years after such
principal or any such premium or interest or any such Additional Amounts shall
have become due and payable shall be paid to the Issuer on Issuer Request or
(if then held by the Issuer) shall be discharged from such trust; and the
Holder of such Security or any Coupon appertaining thereto shall thereafter,
as an unsecured general creditor, look only to the Issuer for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such
trust money, and all liability of the Issuer as trustee thereof, shall
thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Issuer cause to be published once, in an Authorized Newspaper in each Place of
Payment for such series or to be mailed to Holders of Registered Securities of
such series, or both, 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 or mailing nor shall it be later than two years after such
principal and any premium or interest or Additional Amounts shall have become
due and payable, any unclaimed balance of such money then remaining will be
repaid to the Issuer.
Section 1004. Additional Amounts.
If any Securities of a series provide for the payment of Additional
Amounts, the Issuer agrees to pay to the Holder of any such Security or any
Coupon appertaining thereto Additional Amounts as provided in or pursuant to
this Indenture or such Securities. Whenever in this Indenture there is
mentioned, in any context, the payment of the principal of or any premium or
interest on, or in respect of, any Security of any series or any Coupon or the
net proceeds received on the sale or exchange of any Security of any series,
such mention shall be deemed to include mention of the payment of Additional
Amounts provided by the terms of such series established hereby or pursuant
hereto to the extent that, in such context, Additional Amounts are, were or
would be payable in respect thereof pursuant to such terms, and express
mention of the payment of Additional Amounts (if applicable) in any provision
hereof shall not be construed as excluding Additional Amounts in those
provisions hereof where such express mention is not made.
Except as otherwise provided in or pursuant to this Indenture or the
Securities of the applicable series, if the Securities of a series provide for
the payment of Additional Amounts, at least 10 days prior to the first
Interest Payment Date with respect to such series of Securities (or if the
Securities of such series shall not bear interest prior to Maturity, the first
day on which a payment of principal is made), and at least 10 days prior to
each date of payment of principal or interest if there has been any change
with respect to the matters set forth in the below-mentioned Officers'
Certificate, the Issuer shall furnish to the Trustee and the principal Paying
Agent or Paying Agents, if other than the Trustee, an Officers' Certificate
instructing the Trustee and such Paying Agent or Paying Agents whether such
payment of principal of and premium, if any, or interest on the Securities of
such series shall be made to Holders of Securities of such series or the
Coupons appertaining thereto who are United States Aliens without withholding
for or on account of any tax, assessment or other governmental charge
described in the Securities of such series. If any such withholding shall be
required, then such Officers' Certificate shall specify by country the amount,
if any, required to be withheld on such payments to such Holders of Securities
or Coupons, and the Issuer agrees to pay to the Trustee or such Paying Agent
the Additional Amounts required by the terms of such Securities. The Issuer
covenants to indemnify the Trustee and any Paying Agent for, and to hold them
harmless against, any loss, liability or expense reasonably incurred without
negligence or bad faith on their part arising out of or in connection with
actions taken or omitted by any of them in reliance on any Officers'
Certificate furnished pursuant to this Section.
Section 1005. [Intentionally Omitted].
Section 1006. [Intentionally Omitted].
Section 1007. Waiver of Certain Covenants.
The Issuer may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 1005 or 1006 with respect
to the Securities of any series if before the time for such compliance the
Holders of at least a majority in principal amount of the Outstanding
Securities of such series, by Act of such Holders, either shall waive such
compliance in such instance or generally shall have waived compliance with
such term, provision or condition, but no such waiver shall extend to or
affect such term, provision or condition except to the extent so expressly
waived, and, until such waiver shall become effective, the obligations of the
Issuer and the duties of the Trustee in respect of any such term, provision or
condition shall remain in full force and effect.
Section 1008. Issuer Statement as to Compliance; Notice of Certain
Defaults.
(1) The Issuer shall deliver to the Trustee, within 120 days after
the end of each fiscal year, a written statement (which need not be contained
in or accompanied by an Officers' Certificate) signed by the principal
executive officer, the principal financial officer or the principal accounting
officer of the Issuer, stating that
(a) a review of the activities of the Issuer during such year and of
its performance under this Indenture has been made under his or her
supervision, and
(b) to the best of his or her knowledge, based on such review, (a)
the Issuer has complied with all the conditions and covenants imposed on
it under this Indenture throughout such year, or, if there has been a
default in the fulfillment of any such condition or covenant, specifying
each such default known to him or her and the nature and status thereof,
and (b) no event has occurred and is continuing which is, or after notice
or lapse of time or both would become, an Event of Default, or, if such
an event has occurred and is continuing, specifying each such event known
to him and the nature and status thereof.
(2) The Issuer shall deliver to the Trustee, within five days after
the occurrence thereof, written notice of any Event of Default or any event
which after notice or lapse of time or both would become an Event of Default
pursuant to clause (4) of Section 501.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article.
Redemption of Securities of any series at the option of the Issuer
as permitted or required by the terms of such Securities shall be made in
accordance with the terms of such Securities and (except as otherwise provided
herein or pursuant hereto) this Article.
Section 1102. Election to Redeem; Notice to Trustee.
The election of the Issuer to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at
the election of the Issuer of (a) less than all of the Securities of any
series or (b) all of the Securities of any series, with the same issue date,
interest rate or formula, Stated Maturity and other terms, the Issuer shall,
at least 60 days prior to the Redemption Date fixed by the Issuer (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of
such Redemption Date and of the principal amount of Securities of such series
to be redeemed.
Section 1103. Selection by Trustee of Securities to be Redeemed.
If less than all of the Securities of any series with the same issue
date, interest rate or formula, Stated Maturity and other terms are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions of the principal amount of Registered
Securities of such series; provided, however, that no such partial redemption
shall reduce the portion of the principal amount of a Registered Security of
such series not redeemed to less than the minimum denomination for a Security
of such series established herein or pursuant hereto.
The Trustee shall promptly notify the Issuer and the Security
Registrar (if other than itself) 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.
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 of such Securities which has been or is to be
redeemed.
Unless otherwise specified in or pursuant to this Indenture or the
Securities of any series, if any Security selected for partial redemption is
converted or exchanged for Common Stock or other securities in part before
termination of the conversion right with respect to the portion of the
Security so selected, the converted portion of such Security shall be deemed
(so far as may be) to be the portion selected for redemption. Securities which
have been converted during a selection of Securities to be redeemed shall be
treated by the Trustee as Outstanding for the purpose of such selection.
Section 1104. Notice of Redemption.
Notice of redemption shall be given in the manner provided in
Section 106, not less than 30 nor more than 60 days prior to the Redemption
Date, unless a shorter period is specified in the Securities to be redeemed,
to the Holders of Securities to be redeemed. Failure to give notice by mailing
in the manner herein provided to the Holder of any Registered Securities
designated for redemption as a whole or in part, or any defect in the notice
to any such Holder, shall not affect the validity of the proceedings for the
redemption of any other Securities or portion thereof.
Any notice that is mailed to the Holder of any Registered Securities
in the manner herein provided shall be conclusively presumed to have been duly
given, whether or not such Holder receives the notice.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all Outstanding Securities of any series are to be
redeemed, the identification (and, in the case of partial redemption, the
principal amount) of the particular Security or Securities to be redeemed,
(4) in case any Security is to be redeemed in part only, the notice
which relates to such Security shall state that on and after the Redemption
Date, upon surrender of such Security, the Holder of such Security will
receive, without charge, a new Security or Securities of authorized
denominations for the principal amount thereof remaining unredeemed,
(5) that, on the Redemption Date, the Redemption Price shall become
due and payable upon each such Security or portion thereof to be redeemed,
and, if applicable, that interest thereon shall cease to accrue on and after
said date,
(6) the place or places where such Securities, together (in the case
of Bearer Securities) with all Coupons appertaining thereto, if any, maturing
after the Redemption Date, are to be surrendered for payment of the Redemption
Price and any accrued interest and Additional Amounts pertaining thereto,
(7) that the redemption is for a sinking fund, if such is the case,
(8) that, unless otherwise specified in such notice, Bearer
Securities of any series, if any, surrendered for redemption must be
accompanied by all Coupons maturing subsequent to the date fixed for
redemption or the amount of any such missing Coupon or Coupons will be
deducted from the Redemption Price, unless security or indemnity satisfactory
to the Issuer, the Trustee and any Paying Agent is furnished,
(9) if Bearer Securities of any series are to be redeemed and any
Registered Securities of such series are not to be redeemed, and if such
Bearer Securities may be exchanged for Registered Securities not subject to
redemption on the Redemption Date pursuant to Section 305 or otherwise, the
last date, as determined by the Issuer, on which such exchanges may be made,
(10) in the case of Securities of any series that are convertible
into Common Stock or other securities, the conversion price or rate, the date
or dates on which the right to convert the principal of the Securities of such
series to be redeemed will commence or terminate and the place or places where
such Securities may be surrendered for conversion, and
(11) the CUSIP number or the Euroclear or the Cedel reference
numbers of such Securities, if any (or any other numbers used by a Depository
to identify such Securities).
A notice of redemption published as contemplated by Section 106 need
not identify particular Registered Securities to be redeemed.
Notice of redemption of Securities to be redeemed at the election of
the Issuer shall be given by the Issuer or, at the Issuer's request, by the
Trustee in the name and at the expense of the Issuer.
Section 1105. Deposit of Redemption Price.
On or prior to any Redemption Date, the Issuer shall deposit, with
respect to the Securities of any series called for redemption pursuant to
Section 1104, with the Trustee or with a Paying Agent (or, if the Issuer is
acting as its own Paying Agent, segregate and hold in trust as provided in
Section 1003) an amount of money in the applicable Currency sufficient to pay
the Redemption Price of, and (except if the Redemption Date shall be an
Interest Payment Date, unless otherwise specified pursuant to Section 301 or
in the Securities of such series) any accrued interest on and Additional
Amounts with respect thereto, all such 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
Issuer shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest and the Coupons for
such interest appertaining to any Bearer Securities so to be redeemed, except
to the extent provided below, shall be void. Upon surrender of any such
Security for redemption in accordance with said notice, together with all
Coupons, if any, appertaining thereto maturing after the Redemption Date, such
Security shall be paid by the Issuer at the Redemption Price, together with
any accrued interest and Additional Amounts to the Redemption Date; provided,
however, that, except as otherwise provided in or pursuant to this Indenture
or the Bearer Securities of such series, installments of interest on Bearer
Securities whose Stated Maturity is on or prior to the Redemption Date shall
be payable only upon presentation and surrender of Coupons for such interest
(at an Office or Agency located outside the United States except as otherwise
provided in Section 1002), and provided, further, that, except as otherwise
specified in or pursuant to this Indenture or the Registered Securities of
such series, installments of interest on Registered Securities whose Stated
Maturity is on or prior to the Redemption Date shall be payable to the Holders
of such Securities, or one or more Predecessor Securities, registered as such
at the close of business on the Regular Record Dates therefor according to
their terms and the provisions of Section 307.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant Coupons maturing after the Redemption Date,
such Security may be paid after deducting from the Redemption Price an amount
equal to the face amount of all such missing Coupons, or the surrender of such
missing Coupon or Coupons may be waived by the Issuer and the Trustee if there
be furnished to them such security or indemnity as they may require to save
each of them and any Paying Agent harmless. If thereafter the Holder of such
Security shall surrender to the Trustee or any Paying Agent any such missing
Coupon in respect of which a deduction shall have been made from the
Redemption Price, such Holder shall be entitled to receive the amount so
deducted; provided, however, that any interest or Additional Amounts
represented by Coupons shall be payable only upon presentation and surrender
of those Coupons at an Office or Agency for such Security located outside of
the United States except as otherwise provided in Section 1002.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium, until paid,
shall bear interest from the Redemption Date at the rate prescribed therefor
in the Security.
Section 1107. Securities Redeemed in Part.
Any Registered Security which is to be redeemed only in part shall
be surrendered at any Office or Agency for such Security (with, if the Issuer
or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Issuer and the Trustee duly executed by,
the Holder thereof or his attorney duly authorized in writing) and the Issuer
shall execute and the Trustee shall authenticate and deliver to the Holder of
such Security without service charge, a new Registered Security or Securities
of the same series, containing identical terms and provisions, 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 Security in global form is so surrendered,
the Issuer shall execute, and the Trustee shall authenticate and deliver to
the U.S. Depository or other Depository for such Security in global form as
shall be specified in the Issuer Order with respect thereto to the Trustee,
without service charge, a new Security in global form in a denomination equal
to and in exchange for the unredeemed portion of the principal of the Security
in global form so surrendered.
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
permitted or required in or pursuant to this Indenture or any Security of such
series issued pursuant to this Indenture.
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 such 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 and this Indenture.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Issuer may, in satisfaction of all or any part of any sinking
fund payment with respect to the Securities of any series to be made pursuant
to the terms of such Securities (1) deliver Outstanding Securities of such
series (other than any of such Securities previously called for redemption or
any of such Securities in respect of which cash shall have been released to
the Issuer), together in the case of any Bearer Securities of such series with
all unmatured Coupons appertaining thereto, and (2) apply as a credit
Securities of such series which have been redeemed either at the election of
the Issuer pursuant to the terms of such series of Securities or through the
application of permitted optional sinking fund payments pursuant to the terms
of such Securities, provided that such series of Securities have not been
previously so credited. Such Securities shall be received and credited for
such purpose by the Trustee at the Redemption Price specified in such
Securities for redemption through operation of the sinking fund and the amount
of such sinking fund payment shall be reduced accordingly. If as a result of
the delivery or credit of Securities of any series in lieu of cash payments
pursuant to this Section 1202, the principal amount of Securities of such
series to be redeemed in order to exhaust the aforesaid cash payment shall be
less than $100,000, the Trustee need not call Securities of such series for
redemption, except upon Issuer Request, and such cash payment shall be held by
the Trustee or a Paying Agent and applied to the next succeeding sinking fund
payment, provided, however, that the Trustee or such Paying Agent shall at the
request of the Issuer from time to time pay over and deliver to the Issuer any
cash payment so being held by the Trustee or such Paying Agent upon delivery
by the Issuer to the Trustee of Securities of that series purchased by the
Issuer having an unpaid principal amount equal to the cash payment requested
to be released to the Issuer.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 75 days prior to each sinking fund payment date for
any series of Securities, the Issuer shall deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing mandatory 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 of
Securities of that series pursuant to Section 1202, and the optional amount,
if any, to be added in cash to the next ensuing mandatory sinking fund
payment, and will also deliver to the Trustee any Securities to be so credited
and not theretofore delivered. If such Officers' Certificate shall specify an
optional amount to be added in cash to the next ensuing mandatory sinking fund
payment, the Issuer shall thereupon be obligated to pay the amount therein
specified. Not less than 60 days before each such sinking fund payment date
the Trustee shall select the Securities to be redeemed upon such sinking fund
payment date in the manner specified in Section 1103 and cause notice of the
redemption thereof to be given in the name of and at the expense of the Issuer
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
REPAYMENT AT THE OPTION OF HOLDERS
Section 1301. Applicability of Article.
Securities of any series which are repayable at the option of the
Holders thereof before their Stated Maturity shall be repaid in accordance
with the terms of the Securities of such series. The repayment of any
principal amount of Securities pursuant to such option of the Holder to
require repayment of Securities before their Stated Maturity, for purposes of
Section 309, shall not operate as a payment, redemption or satisfaction of the
Indebtedness represented by such Securities unless and until the Issuer, at
its option, shall deliver or surrender the same to the Trustee with a
directive that such Securities be cancelled. Notwithstanding anything to the
contrary contained in this Section 1301, in connection with any repayment of
Securities, the Issuer may arrange for the purchase of any Securities by an
agreement with one or more investment bankers or other purchasers to purchase
such Securities by paying to the Holders of such Securities on or before the
close of business on the repayment date an amount not less than the repayment
price payable by the Issuer on repayment of such Securities, and the
obligation of the Issuer to pay the repayment price of such Securities shall
be satisfied and discharged to the extent such payment is so paid by such
purchasers.
ARTICLE FOURTEEN
SECURITIES IN FOREIGN CURRENCIES
Section 1401. Applicability of Article.
Whenever this Indenture provides for (i) any action by, or the
determination of any of the rights of, Holders of Securities of any series in
which not all of such Securities are denominated in the same Currency, or (ii)
any distribution to Holders of Securities, in the absence of any provision to
the contrary in the form of Security of any particular series or pursuant to
this Indenture or the Securities, any amount in respect of any Security
denominated in a Currency other than Dollars shall be treated for any such
action or distribution as that amount of Dollars that could be obtained for
such amount on such reasonable basis of exchange and as of the record date
with respect to Registered Securities of such series (if any) for such action,
determination of rights or distribution (or, if there shall be no applicable
record date, such other date reasonably proximate to the date of such action,
determination of rights or distribution) as the Issuer may specify in a
written notice to the Trustee or, in the absence of such written notice, as
the Trustee may determine.
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
Section 1501. Purposes for Which Meetings May Be Called.
A meeting of Holders of Securities of any series may be called at
any time and from time to time pursuant to this Article to make, give or take
any request, demand, authorization, direction, notice, consent, waiver or
other Act provided by this Indenture to be made, given or taken by Holders of
Securities of such series.
Section 1502. Call, Notice and Place of Meetings.
(1) The Trustee may at any time call a meeting of Holders of
Securities of any series for any purpose specified in Section 1501, to be held
at such time and at such place in the City of New York, New York, or, if
Securities of such series have been issued in whole or in part as Bearer
Securities, in London or in such place outside the United States as the
Trustee shall determine. Notice of every meeting of Holders of Securities of
any series, setting forth the time and the place of such meeting and in
general terms the action proposed to be taken at such meeting, shall be given,
in the manner provided in Section 106, not less than 21 nor more than 180 days
prior to the date fixed for the meeting.
(2) In case at any time the Issuer (by or pursuant to a Board
Resolution) or the Holders of at least 10% in principal amount of the
Outstanding Securities of any series shall have requested the Trustee to call
a meeting of the Holders of Securities of such series for any purpose
specified in Section 1501, by written request setting forth in reasonable
detail the action proposed to be taken at the meeting, and the Trustee shall
not have mailed notice of or made the first publication of the notice of such
meeting within 21 days after receipt of such request (whichever shall be
required pursuant to Section 106) or shall not thereafter proceed to cause the
meeting to be held as provided herein, then the Issuer or the Holders of
Securities of such series in the amount above specified, as the case may be,
may determine the time and the place in the City of New York, New York, or, if
Securities of such series are to be issued as Bearer Securities, in London for
such meeting and may call such meeting for such purposes by giving notice
thereof as provided in clause (1) of this Section.
Section 1503. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities of
any series, a Person shall be (1) a Holder of one or more Outstanding
Securities of such series, or (2) a Person appointed by an instrument in
writing as proxy for a Holder or Holders of one or more Outstanding Securities
of such series by such Holder or Holders. The only Persons who shall be
entitled to be present or to speak at any meeting of Holders of Securities of
any series shall be the Persons entitled to vote at such meeting and their
counsel, any representatives of the Trustee and its counsel and any
representatives of the Issuer and its counsel.
Section 1504. Quorum; Action.
The Persons entitled to vote a majority in principal amount of the
Outstanding Securities of a series shall constitute a quorum for a meeting of
Holders of Securities of such series; provided however, that if any action is
to be taken at the meeting with respect to a consent or waiver which may be
given by the Holders of not less than a specified percentage in principal
amount of the Outstanding Securities of a series, the Persons holding or
representing the specified percentage in principal amount of the Outstanding
Securities of the series will constitute a quorum. In the absence of a quorum
within 30 minutes after the time appointed for any such meeting, the meeting
shall, if convened at the request of Holders of Securities of such series, be
dissolved. In any other case the meeting may be adjourned for a period of not
less than 10 days as determined by the chairman of the meeting prior to the
adjournment of such meeting. In the absence of a quorum at any such adjourned
meeting, such adjourned meeting may be further adjourned for a period of not
less than 10 days as determined by the chairman of the meeting prior to the
adjournment of such adjourned meeting. Notice of the reconvening of any
adjourned meeting shall be given as provided in Section 1502(1), except that
such notice need be given only once not less than five days prior to the date
on which the meeting is scheduled to be reconvened. Notice of the reconvening
of an adjourned meeting shall state expressly the percentage, as provided
above, of the principal amount of the Outstanding Securities of such series
which shall constitute a quorum.
Except as limited by the proviso to Section 902, any resolution
presented to a meeting or adjourned meeting duly reconvened at which a quorum
is present as aforesaid may be adopted only by the affirmative vote of the
Holders of a majority in principal amount of the Outstanding Securities of
that series; provided, however, that, except as limited by the proviso to
Section 902, any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other Act which this
Indenture expressly provides may be made, given or taken by the Holders of a
specified percentage, which is less than a majority, in principal amount of
the Outstanding Securities of a series may be adopted at a meeting or an
adjourned meeting duly reconvened and at which a quorum is present as
aforesaid by the affirmative vote of the Holders of such specified percentage
in principal amount of the Outstanding Securities of such series.
Any resolution passed or decision taken at any meeting of Holders of
Securities of any series duly held in accordance with this Section shall be
binding on all the Holders of Securities of such series and the Coupons
appertaining thereto, whether or not such Holders were present or represented
at the meeting.
Section 1505. Determination of Voting Rights; Conduct and
Adjournment of Meetings.
(1) Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
meeting of Holders of Securities of such series in regard to proof of the
holding of Securities of such series and of the appointment of proxies and in
regard to the appointment and duties of inspectors of votes, the submission
and examination of proxies, certificates and other evidence of the right to
vote, and such other matters concerning the conduct of the meeting as it shall
deem appropriate. Except as otherwise permitted or required by any such
regulations, the holding of Securities shall be proved in the manner specified
in Section 104 and the appointment of any proxy shall be proved in the manner
specified in Section 104 or by having the signature of the person executing
the proxy witnessed or guaranteed by any trust company, bank or banker
authorized by Section 104 to certify to the holding of Bearer Securities. Such
regulations may provide that written instruments appointing proxies, regular
on their face, may be presumed valid and genuine without the proof specified
in Section 104 or other proof.
(2) The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been called
by the Issuer or by Holders of Securities as provided in Section 1502(2), in
which case the Issuer or the Holders of Securities of the series calling the
meeting, as the case may be, shall in like manner appoint a temporary
chairman. A permanent chairman and a permanent secretary of the meeting shall
be elected by vote of the Persons entitled to vote a majority in principal
amount of the Outstanding Securities of such series represented at the
meeting.
(3) At any meeting, each Holder of a Security of such series or
proxy shall be entitled to one vote for each $1,000 principal amount of
Securities of such series held or represented by him; provided, however, that
no vote shall be cast or counted at any meeting in respect of any Security
challenged as not Outstanding and ruled by the chairman of the meeting to be
not Outstanding. The chairman of the meeting shall have no right to vote,
except as a Holder of a Security of such series or proxy.
(4) Any meeting of Holders of Securities of any series duly called
pursuant to Section 1502 at which a quorum is present may be adjourned from
time to time by Persons entitled to vote a majority in principal amount of the
Outstanding Securities of such series represented at the meeting; and the
meeting may be held as so adjourned without further notice.
Section 1506. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders of
Securities of any series shall be by written ballots on which shall be
subscribed the signatures of the Holders of Securities of such series or of
their representatives by proxy and the principal amounts and serial numbers of
the Outstanding Securities of such series held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and
who shall make and file with the secretary of the meeting their verified
written reports in triplicate of all votes cast at the meeting. A record, at
least in triplicate, of the proceedings of each meeting of Holders of
Securities of any series shall be prepared by the secretary of the meeting and
there shall be attached to said record the original reports of the inspectors
of votes on any vote by ballot taken thereat and affidavits by one or more
persons having knowledge of the facts setting forth a copy of the notice of
the meeting and showing that said notice was given as provided in Section 1502
and, if applicable, Section 1504. Each copy shall be signed and verified by
the affidavits of the permanent chairman and secretary of the meeting and one
such copy shall be delivered to the Issuer, and another to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots
voted at the meeting. Any record so signed and verified shall be conclusive
evidence of the matters therein stated.
* * * * *
This Indenture 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.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed and attested to, all as of the day and year first above
written.
RECKSON SERVICE INDUSTRIES, INC.,
as Issuer
By_____________________________
Name:
Title:
Attest:
____________________________________
Name:
Title:
______________________________,
as Trustee
By_____________________________
Name:
Title:
<PAGE>
STATE OF ______)
) ss.: )
COUNTY OF _______)
On the _____ day of ________, 199_, before me personally
came _________ ___________, to me known, who, being by me duly sworn, did
depose and say that he is the ______________________ of Reckson Service
Industries, Inc., a Delaware corporation, one of the persons described in and
who executed the foregoing instrument; and that he signed his name thereto by
like authority.
__________________________
Notary Public
[NOTARIAL SEAL]
EXHIBIT 12.1
Reckson Service Industries, Inc.
Ratios of Earnings to Fixed Charges
The following table sets forth the calculation of the Company's
consolidated ratio of earnings to fixed charges for the periods shown:
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED FOR THE
SEPTEMBER 30 YEAR ENDED
1999 1998 1997
---- ---- ----
DESCRIPTION
<S> <C> <C> <C>
Interest $5,968,141 $1,651,200 $24,380
Rent Expense 213,663 177,235 0
Amortization of Debt Issuance Costs 0 0 8,214
---------------- ----------------- --------
TOTAL 6,181,804 1,828,435 32,594
---------- ---------- -------
Loss from Continuing
Operations before Fixed Charges ($17,348,982) ($6,251,423) ($225,293)
Ratio of Earnings to Fixed Charges -2.81 -3.42 -6.91
</TABLE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of Reckson Service
Industries, Inc. (the "Company") for the registration of $500,000,000 of
common stock, common stock warrants, preferred stock, preferred stock
warrants, depositary shares and debt securities with respect to the Company.
We also consent to the incorporation by reference of our reports dated (i)
March 12, 1999, with respect to the consolidated financial statements of the
Company included in its Annual Report (Form 10-K) for the year ended December
31, 1998 filed with the Securities and Exchange Commission on March 31,1999,
(ii) March 12, 1999, with respect to the consolidated financial statements of
Interoffice Superholdings Corporation and Subsidiaries for the period November
9, 1998 to December 31, 1998 included in the Company's Form 10-K filed with
the Securities and Exchange Commission on March 31, 1999, (iii) March 5, 1999,
with respect to the consolidated financial statements of RSVP Holdings, LLC
for the period February 26, 1998 to December 31, 1998, included in the
Company's Form 10-K filed with the Securities and Exchange Commission on March
31, 1999, (iv) January 4, 1999, with respect to the combined financial
statements of Xebec Management Services, Inc. and affiliate for the years
ended December 31, 1997 and 1996, included in the Company's Form 8-K filed
with the Securities and Exchange Commission on January 19, 1999 and (v)
September 18, 1998, with respect to the consolidated financial statements of
InterOffice (Holdings) Corporation and Subsidiaries for the years ended
December 31, 1997, 1996 and 1995 included in the Company's Form 8-K filed with
the Securities and Exchange Commission on January 19, 1999.
/s/ Ernst & Young LLP
New York, New York
December 6, 1999
EXHIBIT 23.3
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Amendment No. 1 to
the Registration Statement of Reckson Service Industries, Inc. on Form S-3 of
our report dated February 26, 1999 relating to the consolidated financial
statements of VANTAS Incorporated and Subsidiaries (formerly ALLIANCE NATIONAL
Incorporated and Subsidiaries), which appears in Reckson Service Industries,
Inc.'s Current Report on Form 8-K/A dated March 24, 1999. We also consent to
the reference to us under the heading "Experts" in such Registration
Statement.
/s/ PricewaterhouseCoopers LLP
New York, New York
December 7, 1999
