<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 26, 1997.
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
XEROX CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
NEW YORK 16-0468020
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
</TABLE>
P.O. BOX 1600
STAMFORD, CONNECTICUT 06904-1600
(203) 968-3000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
<TABLE>
<S> <C>
XEROX OVERSEAS HOLDINGS PLC RANK XEROX CAPITAL (EUROPE) PLC
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
UNITED KINGDOM UNITED KINGDOM
(STATE OR OTHER JURISDICTION OF INCORPORATION OR (STATE OR OTHER JURISDICTION OF INCORPORATION OR
ORGANIZATION) ORGANIZATION)
NOT APPLICABLE NOT APPLICABLE
(I.R.S. EMPLOYER IDENTIFICATION NUMBER) (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
PARKWAY PARKWAY
MARLOW MARLOW
BUCKINGHAMSHIRE SL7 1YL BUCKINGHAMSHIRE SL7 1YL
ENGLAND ENGLAND
44-1-628-89-0000 44-1-628-89-0000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE
OFFICES) OFFICES)
</TABLE>
------------------
MARTIN S. WAGNER
ASSISTANT SECRETARY
XEROX CORPORATION
P.O. BOX 1600
STAMFORD, CONNECTICUT 06904-1600
(203) 968-3000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------
COPY TO:
JOHN W. WHITE
CRAVATH, SWAINE & MOORE
WORLDWIDE PLAZA
825 EIGHTH AVENUE
NEW YORK, NEW YORK 10019
------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X].
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration number of the earlier effective
registration statement for the initial 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]
CALCULATION OF REGISTRATION FEE
<TABLE>
<S> <C> <C> <C> <C>
===============================================================================================================================
PROPOSED MAXIMUM
PROPOSED MAXIMUM AGGREGATE
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED(1)(2) PER UNIT(3) PRICE(1)(2)(3) REGISTRATION FEE
- -------------------------------------------------------------------------------------------------------------------------------
Debt Securities................................. $2,000,000,000 100% $2,000,000,000 $606,061
- -------------------------------------------------------------------------------------------------------------------------------
Guarantees(4)................................... -- -- -- None
===============================================================================================================================
</TABLE>
(1) In U.S. dollars or equivalent thereof in foreign denominated currency or
units consisting of multiple currencies.
(2) Or, if any securities are issued at original issue discount, such greater
amount as shall result in aggregate proceeds of $2,000,000,000 to the
Registrant.
(3) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(o) under the Securities Act of 1933.
(4) No additional registration fee is payable in respect of the registration of
the Guarantees.
------------------
STATEMENT PURSUANT TO RULE 429(B)
THE PROSPECTUS CONTAINED IN THIS REGISTRATION STATEMENT IS A COMBINED
PROSPECTUS WHICH ALSO COVERS UP TO $250,000,000 OF DEBT SECURITIES HERETOFORE
COVERED BY REGISTRATION STATEMENT NO. 333-13179; PROVIDED THAT SUCH $250,000,000
OF DEBT SECURITIES MAY BE OFFERED ONLY BY XEROX CORPORATION. THE AMOUNT OF THE
REGISTRATION FEE ASSOCIATED WITH SUCH DEBT SECURITIES THAT WAS PREVIOUSLY PAID
WITH SUCH PRIOR REGISTRATION STATEMENT IS $75,758. THIS REGISTRATION STATEMENT
ALSO CONSTITUTES POST-EFFECTIVE AMENDMENT NO. 1 WITH RESPECT TO SUCH
REGISTRATION STATEMENT NO. 333-13179, AND SUCH POST-EFFECTIVE AMENDMENT SHALL
HEREAFTER BECOME EFFECTIVE CONCURRENTLY WITH THE EFFECTIVENESS OF THIS
REGISTRATION STATEMENT IN ACCORDANCE WITH SECTION 8(C) OF THE SECURITIES ACT OF
1933.
------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================
<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION DATED AUGUST 25, 1997
PROSPECTUS SUPPLEMENT (TO PROSPECTUS DATED AUGUST , 1997)
U.S. $2,250,000,000
XEROX CORPORATION
XEROX OVERSEAS HOLDINGS PLC
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY XEROX CORPORATION
RANK XEROX CAPITAL (EUROPE) PLC
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY XEROX CORPORATION
MEDIUM-TERM NOTES, SERIES E
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
------------------------
Any of Xerox Corporation ("Xerox" or the "Company"), Xerox Overseas Holdings
plc ("Xerox Overseas") and Rank Xerox Capital (Europe) plc ("Xerox Capital") may
offer from time to time its Medium-Term Notes, Series E (the "Notes") initially
limited in aggregate principal amount (or, if any Notes are to be issued as
Discount Notes or Indexed Notes (each as defined below), aggregate initial
offering price) to U.S. $2,250,000,000 or the equivalent in foreign currencies
or currency units. Xerox Overseas and Xerox Capital are collectively referred to
herein as the "Subsidiary Issuers" and, the Company, in its capacity as an
issuer, and the Subsidiary Issuers are collectively referred to herein as the
"Issuers". Each Note will mature nine months or more from the date of issue, as
selected by the purchaser and agreed to by the applicable Issuer, and may be
subject to redemption and/or repayment prior to the Maturity Date (as defined
below). The Notes may be denominated in U.S. dollars or in such foreign
currencies or currency units (the "Specified Currency") as may be described in a
pricing supplement to this Prospectus Supplement (a "Pricing Supplement").
Unless otherwise specified in the applicable Pricing Supplement, Notes
denominated in a Specified Currency other than U.S. dollars or European Currency
Units ("ECU") will not be sold in or to residents of the country issuing such
Specified Currency. See "Important Currency Exchange Information" and
"Currency-Related Risk Factors -- Foreign Currency Risks." Each Note will bear
interest at a fixed rate (a "Fixed Rate Note"), which may be zero in the case of
certain Notes issued at a price representing a substantial discount from the
principal amount payable upon the Maturity Date, or at a floating rate (a
"Floating Rate Note"), as set forth therein and specified in the applicable
Pricing Supplement. A Fixed Rate Note may pay a level amount in respect of both
interest and principal amortized over the life of such Note (an "Amortizing
Note"). See "Description of Notes -- Fixed Rate Notes." The principal amount
payable at maturity of, or the interest on, each Note, or both, may be
determined by reference to the relationship between two or more Specified
Currencies (a "Currency Indexed Note"), or by reference to the price of one or
more specified securities or commodities or to one or more securities or
commodities exchange indices or other indices or by other similar methods (an
"Indexed Note," such term to include Currency Indexed Notes) as described in the
applicable Pricing Supplement. See "Description of Notes -- Currency Indexed
Notes" and "Description of Notes -- Other Indexed Notes."
Unless otherwise specified in the applicable Pricing Supplement, the dates
on which interest, if any, will be payable for each Fixed Rate Note (other than
an Amortizing Note) will be April 15 and October 15 of each year and at Maturity
(as defined below). The dates on which interest will be payable for each
Floating Rate Note will be established on the date of issue of such Note and
will be set forth in the applicable Pricing Supplement. Unless otherwise
specified in the applicable Pricing Supplement, each Amortizing Note will pay
principal and interest (i) semi-annually each April 15 and October 15, or (ii)
quarterly each January 15, April 15, July 15 and October 15 and (iii) at
Maturity.
The aggregate amount of debt of the Company outstanding as of July 31, 1997
was approximately $13,702,000,000.
Unless otherwise specified in the applicable Pricing Supplement, the Notes
will be issued only in registered form in minimum denominations of U.S. $1,000
and any amount in excess thereof that is an integral multiple thereof or, in the
case of Notes denominated in a Specified Currency other than U.S. dollars, the
authorized denominations set forth in the applicable Pricing Supplement. See
"Description of Notes -- General."
Each Note will be represented by either a Global Security registered in the
name of a nominee of The Depository Trust Company, as Depositary, or other
depositary (a "Book-Entry Note"), or a certificate issued in definitive form (a
"Certificated Note"), as set forth in the applicable Pricing Supplement.
Beneficial Interests in Book-Entry Notes will be shown on, and transfers thereof
will be effected only through, records maintained by the Depositary and its
participants. See "Description of Notes -- Global Securities and Book-Entry
System."
FOR A DISCUSSION OF CERTAIN RISK FACTORS THAT SHOULD BE CONSIDERED IN
CONNECTION WITH AN INVESTMENT IN THE NOTES OFFERED HEREBY, SEE "RISK FACTORS" ON
PAGE S-2.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT, ANY PRICING SUPPLEMENT
HERETO OR THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
<TABLE>
<CAPTION>
PRICE TO PUBLIC(1)(2) AGENTS' COMMISSIONS(2)(3) PROCEEDS TO COMPANY(2)(3)(4)
--------------------- ---------------------------------- -----------------------------------------
<S> <C> <C> <C>
Per Note......... 100.000% .125%-.750% 99.875%-99.250%
Total............ U.S. $2,250,000,000 U.S. $2,812,500-U.S. $16,875,000 U.S. $2,247,187,500-U.S. $2,233,125,000
</TABLE>
- ---------------
(1) Unless otherwise specified in the applicable Pricing Supplement, the Price
to Public will be 100% of the principal amount.
(2) Or the equivalent thereof in foreign denominated currencies or units
consisting of multiple currencies.
(3) Unless otherwise specified in the applicable Pricing Supplement, with
respect to Notes with Maturity Dates of 30 years or less from the date of
issue, the applicable Issuer will pay a commission (or grant a discount) to
Goldman, Sachs & Co., Lehman Brothers, Lehman Brothers Inc., Merrill Lynch &
Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan
Securities Inc., Morgan Stanley & Co. Incorporated or Salomon Brothers Inc,
or to any other person subsequently appointed by the applicable Issuer (each
an "Agent," and collectively the "Agents"), ranging from .125% to .750% of
the principal amount of each Note, depending upon its Maturity Date, sold
through such Agent, and may sell Notes to any Agent, as principal, at a
discount for resale to purchasers at varying prices related to prevailing
market prices at the time of resale, or, if set forth in the applicable
Pricing Supplement, at a fixed public offering price, to be determined by
such Agent. With respect to Notes with a Maturity Date that is longer than
30 years from the date of issue sold through any Agent, the rate of
commission (or discount) will be negotiated at the time of sale and will be
specified in the applicable Pricing Supplement. Unless otherwise specified
in the applicable Pricing Supplement, any Note purchased by an Agent as
principal will be purchased at 100% of the principal amount thereof less a
percentage equal to the commission applicable to an agency sale of a Note of
identical maturity. No commission will be payable on any sales made directly
by the Issuers. See "Plan of Distribution."
(4) Before deducting expenses payable by the Issuers estimated at $1,406,061, in
the aggregate, including reimbursement of Agents' expenses.
------------------------
The Notes are offered on a continuous basis by the Issuers through the
Agents, each of which has agreed to use its reasonable best efforts to solicit
purchases of the Notes. Each Issuer reserves the right to appoint additional
agents for the purpose of soliciting offers to purchase the Notes and each
Issuer further reserves the right to sell, and may accept offers to purchase,
the Notes directly on its own behalf in those jurisdictions where it is
authorized to do so. The Notes will not be listed on any securities exchange,
and there can be no assurance that the Notes offered by this Prospectus
Supplement will be sold or that there will be a secondary market for the Notes.
Each Issuer reserves the right to withdraw, cancel or modify the offer made
hereby without notice. Any Issuer, any Agent or any other agent who solicits any
offer may reject such offer in whole or in part. See "Plan of Distribution."
GOLDMAN, SACHS & CO.
LEHMAN BROTHERS
MERRILL LYNCH & CO.
J.P. MORGAN & CO.
MORGAN STANLEY DEAN WITTER
SALOMON BROTHERS INC
------------------------
The date of this Prospectus Supplement is August , 1997.
<PAGE> 3
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE NOTES, INCLUDING
OVER-ALLOTMENT, STABILIZING AND SHORT-COVERING TRANSACTIONS IN SUCH SECURITIES,
AND THE IMPOSITION OF A PENALTY BID, IN CONNECTION WITH THE OFFERING. FOR A
DESCRIPTION OF THESE ACTIVITIES, SEE "PLAN OF DISTRIBUTION".
RISK FACTORS
Prospective investors should consider carefully, in addition to the other
information contained in this Prospectus Supplement and the Prospectus to which
this Prospectus Supplement relates, the following factors in connection with the
Notes offered hereby. This Prospectus Supplement and the Prospectus to which
this Prospectus Supplement relates contain or incorporate by reference certain
forward-looking statements and information relating to the Issuers that are
based on the beliefs of management as well as assumptions made by and
information currently available to management. The words "anticipate,"
"believe," "estimate," "expect," "intends" and similar expressions, as they
relate to the Issuers or the Issuers' management, are intended to identify
forward-looking statements. Such statements reflect the current views of the
Issuers with respect to future events and are subject to certain risks,
uncertainties and assumptions, including the risk factors described in this
Prospectus Supplement. Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect, actual results
may vary materially from those described herein as anticipated, believed,
estimated, expected or intended. The Issuers do not intend to update these
forward-looking statements.
This Prospectus Supplement does not describe all of the risks of an
investment in Notes that result from such Notes being denominated or payable in
or with respect to which payments are determined by reference to a currency or
composite currency other than United States dollars or to one or more interest
rates, currencies or other indices or formulas, either as such risks exist on
the date of this Prospectus Supplement or as they may change from time to time.
Prospective investors should consult their own financial and legal advisors as
to the risks entailed by an investment in such Notes. Such Notes are not an
appropriate investment for investors who are unsophisticated with respect to
foreign currency transactions or transactions involving the applicable interest
rate, currency or other indices or formulas.
FOREIGN CURRENCY RISKS
Governing Law and Judgments
The Notes will be construed in accordance with and governed by the laws of
the State of New York, except that all matters governing the authorization and
execution of the Notes will be governed by the laws of the jurisdiction of
organization of the applicable Issuer. Courts in the United States have not
customarily rendered judgments for money damages denominated in any currency
other than the U.S. dollar. New York statutory law provides, however, that a
court shall render a judgment or decree in the foreign currency of the
underlying obligation and that the judgment or decree shall be converted into
U.S. dollars at a rate of exchange prevailing on the date of the entry of the
judgment or decree.
Exchange Rates and Exchange Controls
An investment in Notes that are denominated in, or the payment of which is
related to the value of, a Specified Currency other than U.S. dollars ("Foreign
Currency Notes") entails significant risks that are not associated with a
similar investment in a security denominated in U.S. dollars. Similarly, an
investment in a Currency Indexed Note entails significant risks that are not
associated with a similar investment in non-Indexed Notes. Such risks include,
without limitation, the possibility of significant market changes in rates of
exchange between the U.S. dollar and the various foreign currencies or composite
currencies (and, in the case of Currency Indexed Notes, the rate of exchange
between the Specified Currency and the Indexed Currency for such Currency
Indexed Notes), the possibility of significant changes in rates of exchange
between the U.S. dollar and the various foreign currencies resulting from
official redenomination with respect to a Specified Currency and the possibility
of the imposition or modification of foreign
S-2
<PAGE> 4
exchange controls by either the United States or foreign governments. Such risks
generally depend on factors over which the Issuers have no control, such as
economic and political events and on the supply of and demand for the relevant
currencies. In recent years, rates of exchange between the U.S. dollar and
certain foreign currencies have been volatile and such volatility may be
expected to continue in the future. Fluctuations in any particular exchange rate
that have occurred in the past are not necessarily indicative, however, of
fluctuations in the rate that may occur during the term of any Foreign Currency
Note. Depreciation of the Specified Currency of a Foreign Currency Note against
the U.S. dollar would result in a decrease in the effective yield of such
Foreign Currency Note below its coupon rate, and in certain circumstances could
result in a loss to the investor, on a U.S. dollar basis. Similarly,
depreciation of the Denominated Currency with respect to a Currency Indexed Note
against the applicable Indexed Currency would result in the principal amount
payable with respect to such Currency Indexed Note at the Maturity Date being
less than the Face Amount of such Currency Indexed Note which, in turn, would
decrease the effective yield of such Currency Indexed Note below its applicable
interest rate and could also result in a loss to the investor. See "Description
of Notes -- Currency Indexed Notes".
The Foreign Currency Notes provide that, in the event of an official
redenomination of a foreign currency or currency unit, the obligations of the
applicable Issuer with respect to payments on Foreign Currency Notes denominated
in such foreign currency or currency unit shall, in all cases, be deemed
immediately following such redenomination to provide for the payment of that
amount of redenominated currency representing the amount of such obligations
immediately before such redenomination. In no event, however, shall any
adjustment be made to any amount payable under the Notes as a result of (a) any
change in the value of a foreign currency or currency unit relative to any other
currency due solely to fluctuations in exchange rates or (b) any redenomination
of any component currency of any foreign currency unit (unless such foreign
currency unit is itself officially redenominated).
Governments have imposed from time to time, and may in the future impose,
exchange controls that could affect exchange rates as well as the availability
of a Specified Currency at an Interest Payment Date or at Maturity of a Foreign
Currency Note. There can be no assurance that exchange controls will not
restrict or prohibit payments of principal (and premium, if any) or interest in
any Specified Currency other than U.S. dollars. Even if there are no actual
exchange controls, it is possible that at an Interest Payment Date or at
Maturity of any particular Foreign Currency Note, the Specified Currency for
such Foreign Currency Note would not be available to the Company due to
circumstances beyond the control of the Company. In any such event, the Company
will make required payments in U.S. dollars on the basis described herein. See
"Payment Currency".
Currently, there are limited facilities in the United States for conversion
of U.S. dollars into foreign currencies, and vice versa. In addition, banks
currently do not generally offer non-U.S. dollar denominated checking or savings
account facilities in the United States. Accordingly, payments on Foreign
Currency Notes made in a Specified Currency other than U.S. dollars will be made
from an account with a bank located outside the United States. See "Payment
Currency".
Unless otherwise specified in the applicable Pricing Supplement, Notes
denominated in a Specified Currency other than U.S. dollars or ECU will not be
sold in or to residents of the country issuing the Specified Currency. The
information set forth in this Prospectus Supplement is directed to prospective
purchasers who are United States residents, and the Issuers disclaim any
responsibility to advise prospective purchasers who are residents of countries
other than the United States with respect to any matters that may affect the
purchase, holding or receipt of payments of principal (and premium, if any) or
interest on the Notes. Such persons should consult their own counsel with regard
to such matters.
Pricing Supplements relating to Foreign Currency Notes or Indexed Notes
will contain information concerning historical exchange rates for the applicable
Specified Currency against the U.S. dollar or other relevant currency and a
description of the currency or currencies and any exchange controls affecting
such currency or currencies. The information therein concerning exchange rates
is furnished as a matter of information only and should not be regarded as
indicative of the range of or trends in fluctuations in currency exchange rates
that may occur in the future.
S-3
<PAGE> 5
Payment Currency
Except as set forth below, if payment on a Foreign Currency Note is
required to be made in a Specified Currency other than U.S. dollars and such
currency is unavailable due to the imposition of exchange controls or other
circumstances beyond an Issuer's control, or is no longer used by the government
of the country issuing such currency or for the settlement of transactions by
public institutions of or within the international banking community, then all
payments due on that due date with respect to such Foreign Currency Note shall
be made in U.S. dollars. The amount so payable on any date in such Specified
Currency shall be converted into U.S. dollars at a rate determined by the
Exchange Rate Agent on the basis of the noon buying rate in The City of New York
for cable transfers in the Specified Currency as certified for customs purposes
by the Federal Reserve Bank of New York (the "Market Exchange Rate") for such
Specified Currency on the second Business Day prior to such payment date, or as
otherwise indicated in an applicable Pricing Supplement. In the event such
Market Exchange Rate is not then available, such Issuer will be entitled to make
payments in U.S. dollars (i) if such Specified Currency is not a composite
currency, on the basis of the most recently available Market Exchange Rate for
such Specified Currency or (ii) if such Specified Currency is a composite
currency, in an amount determined by the Exchange Rate Agent to be the sum of
the results obtained by multiplying the number of units of each component
currency of such composite currency, as of the most recent date on which such
composite currency was used, by the Market Exchange Rate for such component
currency on the second Business Day prior to such payment date (or, if such
Market Exchange Rate is not then available, by the most recently available
Market Exchange Rate for such component currency).
If payment on a Foreign Currency Note is required to be made in ECU and ECU
are unavailable due to the imposition of exchange controls or other
circumstances beyond an Issuer's control, or are no longer used in the European
Monetary System, all payments due on that due date with respect to such Foreign
Currency Notes shall be made in U.S. dollars. The amount so payable on any date
in ECU shall be converted into U.S. dollars at a rate determined by the Exchange
Rate Agent as of the second Business Day prior to the date on which such payment
is due on the following basis. The component currencies of the ECU for this
purpose (the "Components") shall be the currency amounts that were components of
the ECU as of the last date on which ECU were used in the European Monetary
System. The equivalent of ECU in U.S. dollars shall be calculated by aggregating
the U.S. dollar equivalents of the Components. The U.S. dollar equivalent of
each of the Components shall be determined by the Exchange Rate Agent on the
basis of the most recently available Market Exchange Rate, or as otherwise
indicated in the applicable Pricing Supplement.
If the official unit of any component currency is altered by way of
combination or subdivision, the number of units of that currency as a Component
shall be divided or multiplied in the same proportion. If two or more component
currencies are consolidated into a single currency, the amounts of those
currencies as Components shall be replaced by an amount in such single currency
equal to the sum of the amounts of the consolidated component currencies
expressed in such single currency. If any component currency is divided into two
or more currencies, the amount of that currency as a Component shall be replaced
by amounts of such two or more currencies, each of which shall have a value on
the date of division equal to the amount of the former component currency
divided by the number of currencies into which that currency was divided.
All determinations referred to above made by the Exchange Rate Agent shall
be at its sole discretion (except to the extent expressly provided herein that
any determination is subject to approval by the applicable Issuer) and, in the
absence of manifest error, shall be conclusive for all purposes and binding on
Holders of the Notes and the Exchange Rate Agent shall have no liability
therefor.
RISKS ASSOCIATED WITH INDEXED NOTES
An investment in Notes indexed, as to principal or interest or both, to one
or more values of currencies or composite currencies (including exchange rates
and swap indices or formulas between currencies or composite currencies),
commodities or interest rate indices entails significant risks that are
S-4
<PAGE> 6
not associated with similar investments in a conventional fixed-rate debt
security. If the interest rate on such a Note is so indexed, it may result in an
interest rate that is less than that payable on a conventional fixed-rate debt
security issued at the same time, including the possibility that no interest
will be paid or that negative interest will accrue, and, if the principal amount
of such a Note is so indexed, the principal amount payable at maturity may be
less than the original purchase price of such Note if allowed pursuant to the
terms of such Note, including the possibility that no principal will be paid, or
if such principal amount is utilized to net against accrued negative interest,
the principal amount payable at maturity may be less than the original purchase
price of such Note if allowed pursuant to the terms of such Note, including the
possibility that no principal will be paid. The secondary market for such Notes
will be affected by a number of factors, independent of the creditworthiness of
the issuer and the value of the applicable currency, commodity or interest rate
index, the time remaining to the maturity of such Notes, the amount outstanding
of such Notes and market interest rates. The value of the applicable currency,
commodity or interest rate index depends on a number of interrelated factors,
including economic, financial and political events, over which the Issuers have
no control. Additionally, if the formula used to determine the principal amount
or interest payable with respect to such Notes contains a multiple or leverage
factor, the effect of any change in the applicable currency, commodity or
interest rate index will be increased. The historical experience of the relevant
currencies, commodities or interest rate indices should not be taken as an
indication of future performance of such currencies, commodities or interest
rate indices during the term of any Note.
The credit ratings assigned to the Issuers' medium-term note program are a
reflection of the Issuers' and the Guarantor's credit status, and in no way are
a reflection of the potential impact of the factors discussed above, or any
other factors, on the market value of the Notes. Accordingly, prospective
investors should consult their own financial and legal advisors as to the risk
entailed by an investment in such Notes and the suitability of such Notes in
light of their particular circumstances.
SUMMARIZED FINANCIAL INFORMATION OF XEROX OVERSEAS
Xerox Overseas, which was formed in November 1996, is the majority
shareholder of Xerox Limited and also owns 100 percent of those companies of
Rank Group which were acquired in June 1997. See "The Company." The following
table presents combined financial information of Xerox Overseas and its
subsidiaries as if Xerox Overseas owned those subsidiaries since November 1,
1993. Effective as of January 1, 1995, Xerox Overseas changed its fiscal year
end to December 31 from October 31. The results of operations during the period
between the end of the 1994 fiscal year and the beginning of the new calendar
year amounted to a loss of $21 million. The loss was charged to retained
earnings to avoid reporting more than 12 months results of operations in one
year.
INCOME STATEMENT INFORMATION:
<TABLE>
<CAPTION>
YEARS ENDED
---------------------------------
SIX MONTHS ENDED
JUNE 30, DECEMBER 31,
----------------- ----------------- OCTOBER 31,
1997 1996 1996 1995 1994
------ ------ ------ ------ -----------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C>
Total Revenues.......................... $2,676 $2,723 $5,630 $5,749 $ 5,050
Income Before Income Taxes, Equity
Income and Minorities' Interests...... 196 227 561 777 286
Equity in Net Income of Unconsolidated
Affiliates............................ 73 70 135 15 4
Minorities' Interests in Earnings of
Subsidiaries.......................... 2 3 7 3 3
Net Income.............................. $ 206 $ 220 $ 502 $ 563 $ 198
</TABLE>
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BALANCE SHEET INFORMATION:
<TABLE>
<CAPTION>
DECEMBER 31,
JUNE 30, 1997 1996 1995
---------------- ------ ------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C>
Total Current Assets..................... $3,049 $3,120 $3,050
Total Current Liabilities................ 4,321 3,092 2,726
Total Non Current Assets................. 5,305 4,535 4,422
Total Non Current Liabilities............ 1,328 1,132 1,520
Minorities' Interests in Equity of
Subsidiaries........................... 20 21 11
</TABLE>
DESCRIPTION OF NOTES
The Notes are a series of Debt Securities described in the accompanying
Prospectus. Reference should be made to the accompanying Prospectus for a
detailed summary of additional provisions of the Notes and of the indenture
under which the Notes are issued. Unless otherwise specified in a Pricing
Supplement, the following description of the Notes will apply.
GENERAL
The Notes are to be issued as a series of Debt Securities initially limited
to U.S. $2,250,000,000 aggregate principal amount (or if any Notes are to be
issued as Discount Notes or Indexed Notes (each as defined below), aggregate
initial offering price), or the equivalent in foreign currencies or currency
units, under an indenture dated as of August , 1997 (as the same may be
amended, supplemented or modified from time to time, the "Indenture"), among the
Company, the Subsidiary Issuers and Citibank, N.A., as trustee (the "Trustee"),
which Indenture is described more fully under "Description of the Debt
Securities" in the accompanying Prospectus. The Issuers may, however, increase
the foregoing limit if they determine in the future that they wish to sell
additional Notes. The U.S. dollar equivalent of Notes denominated in a Specified
Currency other than U.S. dollars will be determined upon issuance by the
Exchange Rate Agent (as defined below), on the basis of the Market Exchange Rate
(as defined below) for such Specified Currency on the applicable trade dates.
The statements herein concerning the Notes and the Indenture do not purport to
be complete. They are qualified in their entirety by reference to the provisions
of the Indenture, including the definitions of certain terms used herein without
definition. The Notes constitute a single series for purposes of the Indenture.
The Company will irrevocably and unconditionally guarantee payments of
principal, premium, if any, and interest, if any, with respect to Notes issued
by the Subsidiary Issuers.
The Notes will be offered on a continuous basis and will mature on any day
nine months or more from the date of issue, as selected by the purchaser and
agreed to by the applicable Issuer, and may be subject to redemption and/or
repayment prior to their Maturity Date if so provided in the applicable Pricing
Supplement. See "Redemption and Repayment" below. Each Note will bear interest
from the Original Issue Date (as defined below) at either (a) a fixed rate,
which may be zero in the case of a Note issued at an Issue Price (as defined
below) representing a substantial discount from the principal amount payable
upon the Maturity Date (a "Zero-Coupon Note"), or (b) a floating rate or rates
determined by reference to one or more Base Rates which may be adjusted by a
Spread and/or Spread Multiplier, if any (each as defined below).
The Notes will be issued initially as either Book-Entry Notes or
Certificated Notes in fully registered form without coupons. Except as set forth
in the Prospectus under "Description of the Debt Securities -- Global
Securities" and under "Global Securities and Book-Entry System" below,
Book-Entry Notes will not be issuable as Certificated Notes.
Unless otherwise specified in the applicable Pricing Supplement, the
authorized denominations of Notes denominated in U.S. dollars will be U.S.
$1,000 and any integral multiple in excess thereof. The authorized denominations
of Notes denominated in a Specified Currency other than U.S. dollars will be as
set forth in the applicable Pricing Supplement.
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The Notes issued by the Company and the Guarantees will be unsecured
obligations of the Company, and will rank pari passu with all other unsecured
and unsubordinated debt of the Company. The Notes issued by a Subsidiary Issuer
will be unsecured obligations of such Subsidiary Issuer, and will rank pari
passu with all other unsecured and unsubordinated debt of such Subsidiary
Issuer. See "Description of the Debt Securities -- Ranking". With respect to any
Debt Securities issued by Xerox Capital, in the event of a default by Xerox
Capital in the performance of its obligations to pay the principal of, and
premium, if any, and interest, if any, on any such Debt Securities, any Holder
of such Debt Securities shall be entitled to serve upon Xerox Capital a demand
and upon receipt Xerox Capital shall, if and to the extent that it shall have
rights to call for the subscription of further shares under the Amended and
Restated Subscription Agreement between Rank Xerox Limited and Xerox Capital
(the "Original Subscription Agreement"), serve upon Rank Xerox Limited, or if
the proposed Amended and Restated Subscription Agreement among Rank Xerox
Limited, Xerox Overseas and Xerox Capital (the "Subscription Agreement") shall
than have been executed, serve upon Rank Xerox Limited or, if Xerox Capital
shall then have become a majority-owned subsidiary of Xerox Overseas, Xerox
Overseas a written demand for the subscription of additional shares in the share
capital of Xerox Capital pursuant to and subject to the provisions of the
Original Subscription Agreement or the Subscription Agreement, as the case may
be.
Debt Securities issued by the Subsidiary Issuers in respect of which the
Issue proceeds are to be accepted by the Subsidiary Issuers in the United
Kingdom and which are issued pursuant to an exempt transaction under regulation
13(1) or (3) of the Banking Act 1997 (Exempt Transactions) Regulations 1997 of
the United Kingdom (the "U.K. Regulations") will constitute shorter term debt
securities or longer term debt securities (in each case, as defined in the U.K.
Regulations), as specified in such Debt Securities, in each case issued in
accordance with regulations made under section 4 of the Banking Act 1987 of the
United Kingdom. The Subsidiary Issuers are not authorized institutions or
European authorized institutions (as such terms are defined in the U.K.
Regulations) and repayment of the principal and payment of any interest or
premium in connection with such Debt Securities will be guaranteed by the
Guarantor, which is not an authorized institution or a European authorized
institution.
The Pricing Supplement will indicate either that the Notes cannot be
redeemed prior to their Maturity Date or that the Notes will be redeemable at
the option of the Issuer thereof on or after a specified date prior to their
Maturity Date at par or at prices declining from a specified premium to par
after a later date, together with accrued interest to the date of redemption.
The Pricing Supplement will also indicate either that the Notes cannot be repaid
prior to their Maturity Date or that the Notes will be repayable at the option
of the Holder thereof on a date or dates specified prior to their Maturity Date
at the price or prices set forth in the applicable Pricing Supplement, together
with accrued interest to the date of repayment. Unless otherwise specified in
the applicable Pricing Supplement, the Notes will not be subject to any sinking
fund. See "Redemption and Repayment" below.
References herein to "U.S. dollars", "dollars", "U.S.$" or "$" are to the
currency of the United States of America.
Unless otherwise specified in the applicable Pricing Supplement, as used
herein:
(i) "Business Day" means any day, other than a Saturday or Sunday,
that is neither a legal holiday nor a day on which banking institutions are
authorized or required by law, regulation or executive order to be closed
in The City of New York and (x) with respect to Notes denominated in a
Specified Currency other than U.S. dollars or ECUs, in the Principal
Financial Center (as defined below) of the country of such Specified
Currency, (y) with respect to Notes denominated in ECUs, in the City of
London and Luxembourg City, Luxembourg, and (z) with respect to LIBOR Notes
(as defined below), is also a London Banking Day. "London Banking Day"
means any day (i) if the Index Currency (as defined below) is other than
ECU, on which dealings in such Index Currency are transacted in the London
interbank market or (ii) if the Index Currency is ECU, that is not
designated as an ECU Non-Settlement Day by the ECU Banking Association or
is otherwise generally regarded in the ECU interbank market as a day on
which payments in ECUs shall be made;
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<PAGE> 9
(ii) "Discount Note" means (a) a Note, including any Zero-Coupon Note,
that has been issued at an issue price lower than the principal amount
thereof and which provides that upon redemption, repayment or acceleration
of the maturity thereof an amount less than the principal amount thereof
will become due and payable and (b) any other Note that for United States
Federal income tax purposes would be considered an original issue discount
note; and
(iii) "Maturity Date" with respect to any Note means the date on which
such Note will mature, as specified therein, and "Maturity" means the date
on which the principal of a Note becomes due and payable in accordance with
its terms, whether at its Maturity Date or by declaration of acceleration,
call for redemption, put for repayment or otherwise.
The Pricing Supplement relating to each Note will identify the Issuer of
such Note and describe the following terms: (1) the Specified Currency with
respect to such Note (and, if such Specified Currency is other than U.S.
dollars, certain other terms relating to such Note); (2) whether such Note is a
Fixed Rate Note, an Amortizing Note, a Floating Rate Note, a Discount Note or a
Zero-Coupon Note; (3) whether such Note is a Currency Indexed Note or other
Indexed Note, and if so the special terms thereof; (4) if other than 100%, the
price (expressed as a percentage of the aggregate principal amount thereof) at
which such Note will be issued (the "Issue Price"); (5) the date on which such
Note will be issued (the "Original Issue Date"); (6) the Maturity Date of such
Note and whether such Maturity Date may be extended by the Issuer of such Note;
(7) if such Note is a Fixed Rate Note, the rate per annum at which such Note
will bear interest, if any; (8) if such Note is a Floating Rate Note, the Base
Rate, the Initial Interest Rate, the Interest Reset Period, the Interest Reset
Dates, the Interest Payment Dates, the Index Maturity, the Maximum Interest Rate
and Minimum Interest Rate, if any, and the Spread and/or Spread Multiplier, if
any (all as defined herein), and any other terms relating to the particular
method of calculating the interest rate for such Note; (9) if such Note is an
Amortizing Note, whether payments of principal thereof and interest thereon will
be made quarterly or semi-annually, and the repayment information in respect
thereof; (10) whether such Note may be redeemed or repaid prior to its Maturity
Date, and if so, the provisions relating to such redemption or repayment; (11)
whether such Note will be issued initially as a Book-Entry Note or a
Certificated Note; (12) original issue discount provisions, if any, and (13) any
other terms of such Note not inconsistent with the provisions of the Indenture.
PAYMENT OF PRINCIPAL AND INTEREST
Unless otherwise specified in the applicable Pricing Supplement and except
as otherwise provided with respect to Currency Indexed Notes, the principal (and
premium, if any) and interest, if any, on the Notes will be paid by the Issuer
thereof in U.S. dollars in the manner described in the following paragraphs,
even if a Note is denominated in a Specified Currency other than U.S. dollars;
provided, however, that the Holder of a Note may (if such Note is denominated in
a Specified Currency other than U.S. dollars and if the applicable Pricing
Supplement and the Note so indicate) elect to receive all such payments in such
Specified Currency (subject to certain conditions, see "Foreign Currency
Risks -- Payment Currency") by delivery of a written request to the applicable
Issuer's paying agent (the "Paying Agent") in The City of New York, which must
be received by the Paying Agent on or prior to the applicable record date or at
least fifteen calendar days prior to Maturity, as the case may be. Such election
shall remain in effect unless and until changed by written notice to the Paying
Agent, but the Paying Agent must receive written notice of any such change on or
prior to the applicable record date or at least fifteen calendar days prior to
Maturity, as the case may be. Until the Notes are paid or payment thereof is
provided for, the Issuers will, at all times, maintain a Paying Agent in The
City of New York capable of performing the duties described herein to be
performed by the Paying Agent. The Issuers have initially appointed Citibank,
N.A., New York, New York as Paying Agent. Each Issuer will notify the Holders of
its Notes in accordance with the indenture of any change in the Paying Agent or
its address.
All currency exchange costs, if any, will be borne by the applicable Issuer
unless any Holder of a Note has made the election referred to in the preceding
paragraph. In that case, each electing Holder shall bear its pro-rata portion of
currency exchange costs, if any, by deductions from payments otherwise due to
such Holder.
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<PAGE> 10
Unless otherwise specified in the applicable Pricing Supplement, in the
case of a Note denominated in a Specified Currency other than U.S. dollars,
unless the Holder thereof has elected otherwise, the amount of U.S. dollar
payments in respect of such Note will be determined by an agent appointed by the
Issuer of such Note (the "Exchange Rate Agent"), which shall initially be
Citibank, N.A., based on the highest firm bid quotation received by such
Exchange Rate Agent at approximately 11:00 a.m., New York City time, on the
second Business Day preceding the applicable payment date, from three recognized
foreign exchange dealers selected by the Exchange Rate Agent and approved by
such Issuer (one of which may be the Exchange Rate Agent) for the purchase by
the quoting dealer, for settlement on such payment date, of the aggregate amount
of the Specified Currency payable on such payment date in respect of all Notes
denominated in such Specified Currency on which payments are to be made in U.S.
dollars. If three such bid quotations are not available, payments will be made
in the Specified Currency, which will yield the largest number of U.S. dollars
when such Issuer is receiving U.S. dollars in lieu of the Specified Currency and
will require the smallest number of U.S. dollars when such Issuer is paying U.S.
dollars in lieu of the Specified Currency. Unless otherwise specified in the
applicable Pricing Supplement, such selection shall be made from among the
quotations appearing in the display "page" within the Reuters or Telerate
Monitor Foreign Exchange Service, as may be agreed to by such Issuer and such
Exchange Rate Agent (or, if such display "page" is not available or such
Specified Currency is a composite currency for which separate current composite
currency quotations are not available, such other comparable display or other
comparable manner of obtaining quotations as may be agreed to by such Issuer and
such Exchange Rate Agent), used to determine the U.S. dollar equivalent of such
Specified Currency (the "Exchange Rate"). If no such indicative quotations are
available, payments will be made in the Specified Currency unless such Specified
Currency is unavailable due to the imposition of exchange controls or to other
circumstances beyond such Issuer's control, in which case such Issuer will be
entitled to make payments as described under "Currency-Related Risk
Factors -- Foreign Currency Risks -- Payment Currency".
In the event of an official redenomination of a Specified Currency, the
obligations of an Issuer with respect to payments on Notes denominated in such
Specified Currency shall, in all cases, be deemed immediately following such
redenomination to provide for payment of that amount of redenominated currency
representing the amount of such obligations immediately before such
redenomination. In no event, however, shall any adjustment be made to any amount
payable under the Notes as a result of any change in the value of such Specified
Currency relative to any other currency due solely to fluctuations in exchange
rates. See "Currency-Related Risk Factors -- Foreign Currency Risks -- Exchange
Rates and Exchange Controls".
Unless otherwise specified in the applicable Pricing Supplement, interest
on Certificated Notes and principal of Amortizing Notes (issued in certificated
form) (in each case, other than interest or, in the case of Amortizing Notes,
principal paid at Maturity) will be paid by mailing a check (from an account at
a bank outside the United States if such interest is payable in a currency other
than U.S. dollars) to the Holder at the address of such Holder appearing on the
security register of the Issuer of such Notes on the applicable record date
(which, in the case of Global Securities representing Book-Entry Notes, will be
a nominee of the Depositary); provided, however, that in the case of a Note
issued between a Regular Record Date and the initial Interest Payment Date
relating to such Regular Record Date, interest for the period beginning on the
Original Issue Date and ending on such initial Interest Payment Date shall be
paid on the next succeeding Interest Payment Date to the registered Holder of
such Note on the related Regular Record Date. Notwithstanding the foregoing, a
Holder of U.S. $10,000,000 or more in aggregate principal amount of Notes of
like tenor and terms (or a Holder of the equivalent thereof in a Specified
Currency other than U.S. dollars) shall be entitled to receive such interest
payments by wire transfer in immediately available funds, but only if
appropriate instructions have been received in writing by the Paying Agent on or
prior to the applicable Record Date. Simultaneously with the election by any
Holder to receive payments in a Specified Currency other than U.S. dollars (as
provided above), such Holder may, if applicable, provide appropriate
instructions to the Paying Agent, and all such payments will be made in
immediately available funds to an account maintained by the payee with a bank
located outside the United States. Unless otherwise specified in the applicable
Pricing Supplement, payments of principal
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<PAGE> 11
(and premium, if any) and interest at Maturity will be made to the Holder on the
date of Maturity in immediately available funds (payable to an account
maintained by the payee with a bank located outside of the United States if
payable in a Specified Currency other than U.S. dollars) upon surrender of the
Notes at the Corporate Trust Office of Citibank, N.A. in the Borough of
Manhattan, The City of New York (or at such other location as may be specified
in the applicable Pricing Supplement), provided that the Note is presented to
the Paying Agent in time for the Paying Agent to make such payments in such
funds in accordance with its customary procedures. See "Important Currency
Exchange Information" below. The applicable Issuer will pay any administrative
costs imposed by banks in connection with making payments in immediately
available funds, but any tax, assessment or governmental charge imposed upon
payments will be borne by the Holders of the Notes in respect of which such
payments are made.
Each date on which interest is payable on a Note (other than at Maturity)
is referred to herein as an "Interest Payment Date". The Interest Payment Dates
and the Regular Record Dates for Fixed Rate Notes shall be as described below
under "Fixed Rate Notes". The Interest Payment Dates for Floating Rate Notes
shall be as indicated in the applicable Pricing Supplement and, unless otherwise
specified in the applicable Pricing Supplement, each "Regular Record Date" for a
Floating Rate Note will be the fifteenth day (whether or not a Business Day)
next preceding each Interest Payment Date.
Unless otherwise specified in the applicable Pricing Supplement, all
percentages resulting from any calculation of the rate of interest on a Note
will be rounded, if necessary, to the nearest one one-hundred-thousandth of a
percent (with five one-millionths of a percentage point being rounded upwards)
and all currency amounts used in or resulting from any calculation on a Note
will be rounded to the nearest one one-hundredth of a unit (with five
one-thousandths of a unit being rounded upwards).
Interest rates offered by an Issuer with respect to the Notes may differ
depending upon, among other things, the aggregate principal amount of Notes
purchased in any single transaction. Interest rates, interest rate formulas and
other variable terms of the Notes are subject to change by an Issuer from time
to time, but no such change will affect any Note already issued or as to which
an offer to purchase has been accepted by such Issuer.
FIXED RATE NOTES
Each Fixed Rate Note will bear interest from its Original Issue Date at the
rate per annum set forth therein and in the applicable Pricing Supplement
(except as described below under "Subsequent Interest Periods" and "Extension of
Maturity Date") until the principal amount thereof is paid or made available for
payment. Interest on Fixed Rate Notes, if any, will, unless otherwise specified
in the applicable Pricing Supplement, be computed on the basis of a 360-day year
of twelve 30-day months. Unless otherwise specified in the applicable Pricing
Supplement, interest on each Fixed Rate Note (other than a Zero-Coupon Note or
an Amortizing Note) will be payable at Maturity and semi-annually each April 15
and October 15, and the "Regular Record Dates" will be March 31 and September 30
(whether or not a Business Day), respectively. Unless otherwise specified in the
applicable Pricing Supplement, principal of and interest on each Amortizing Note
will be payable at Maturity and either semi-annually each April 15 and October
15, or quarterly each January 15, April 15, July 15 and October 15, and the
"Regular Record Dates" will be March 31 and September 30 (whether or not a
Business Day), in the case where the principal of and interest on such
Amortizing Note are payable semi-annually, and December 31, March 31, June 30
and September 30 (whether or not a Business Day), in the case where the
principal of and interest on such Amortizing Note are payable quarterly.
Payments with respect to Amortizing Notes will be applied first to interest due
and payable thereon and then to the reduction of the unpaid principal amount
thereof. A table setting forth repayment information in respect of each
Amortizing Note will be set forth in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, each
payment of interest on a Fixed Rate Note shall include interest accrued through
the day before the Interest Payment Date or Maturity, as the case may be.
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FLOATING RATE NOTES
Except for the period from the Original Issue Date to the first Interest
Reset Date set forth in the applicable Pricing Supplement, each Floating Rate
Note will bear interest from its Original Issue Date until the principal amount
thereof is paid or made available for payment at a rate determined by reference
to an interest rate base (the "Base Rate"), which may be adjusted by a Spread
and/or Spread Multiplier, if any (each as defined below). The applicable Pricing
Supplement will designate one of the following Base Rates as applicable to each
Floating Rate Note: (a) the CD Rate (a "CD Rate Note"), (b) the CMT Rate (a "CMT
Rate Note"), (c) the Commercial Paper Rate (a "Commercial Paper Rate Note"), (d)
the Federal Funds Rate (a "Federal Funds Rate Note"), (e) the J.J. Kenny Rate (a
"J.J. Kenny Rate Note"), (f) LIBOR (a "LIBOR Note"), (g) the Treasury Rate (a
"Treasury Rate Note"), (h) the Prime Rate (a "Prime Rate Note"), (i) the 11th
District Cost of Funds Rate (an "11th District Cost of Funds Rate Note") or (j)
such other Base Rate as is set forth in such Pricing Supplement and in such
Floating Rate Note. The "Index Maturity" for any Floating Rate Note is the
designated maturity of the investment or obligation from which the Base Rate is
calculated as specified in the applicable Pricing Supplement.
As specified in the applicable Pricing Supplement, a Floating Rate Note may
also have either or both of the following: (i) a maximum limitation, or ceiling,
on the rate at which interest may accrue during any interest period ("Maximum
Interest Rate"); and (ii) a minimum limitation, or floor, on the rate at which
interest may accrue during any interest period ("Minimum Interest Rate"). In
addition to any Maximum Interest Rate that may be applicable to any Floating
Rate Note pursuant to the above provisions, the interest rate on a Floating Rate
Note will in no event be higher than the maximum rate permitted by applicable
law, as the same may be modified by United States law of general application.
The Notes will be governed by the law of the State of New York and, under
present New York law, the maximum rate of interest, with certain exceptions, for
any loan in an amount less than $250,000 is 16% and for any loan in an amount of
$250,000 or more but less than $2,500,000 is 25% per annum on a simple interest
basis. These limits do not apply to loans of $2,500,000 or more.
The rate of interest on each Floating Rate Note will be reset daily,
weekly, monthly, quarterly, semi-annually, annually or otherwise (the "Interest
Reset Period"), as specified in the applicable Pricing Supplement. Unless
otherwise specified in the applicable Pricing Supplement, the date or dates on
which interest will be reset (each an "Interest Reset Date") will be, in the
case of Floating Rate Notes that reset daily, each Business Day; in the case of
Floating Rate Notes (other than Treasury Rate Notes) that reset weekly, the
Wednesday of each week; in the case of Treasury Rate Notes that reset weekly,
the Tuesday of each week (except as provided below); in the case of Floating
Rate Notes that reset monthly, the third Wednesday of each month; in the case of
Floating Rate Notes that reset quarterly, the third Wednesday of March, June,
September and December; in the case of Floating Rate Notes that reset
semi-annually, the third Wednesday of the two months specified in the applicable
Pricing Supplement; and in the case of Floating Rate Notes that reset annually,
the third Wednesday of the month specified in the applicable Pricing Supplement;
provided, however, that the interest rate in effect from the Original Issue Date
to the first Interest Reset Date will be the Initial Interest Rate (as defined
below). If any Interest Reset Date for any Floating Rate Note would otherwise be
a day that is not a Business Day, such Interest Reset Date shall be postponed to
the succeeding Business Day, except that, in the case of a LIBOR Note, if such
Business Day is in the next succeeding calendar month, such Interest Reset Date
shall be the immediately preceding Business Day. If an auction for Treasury
bills falls on a day that is an Interest Reset Date for Treasury Rate Notes, the
Interest Reset Date shall be the next succeeding Business Day. The interest rate
in effect with respect to a Floating Rate Note from the Original Issue Date to
the first Interest Reset Date (the "Initial Interest Rate") or the method of
calculating such rate will be specified in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the
interest rate on each Floating Rate Note will be calculated by reference to the
specified Base Rate (i) plus or minus the Spread, if any, and/or (ii) multiplied
by the Spread Multiplier, if any. The "Spread" is the number of basis points
(one basis point equals one one-hundredth of a percentage point) specified in
the applicable Pricing
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<PAGE> 13
Supplement as being applicable to the interest rate for such Floating Rate Note,
and the "Spread Multiplier" is the percentage specified in the applicable
Pricing Supplement as being applicable to the interest rate for such Floating
Rate Note.
Unless otherwise specified in the applicable Pricing Supplement, the
interest payable on each Interest Payment Date or at Maturity for Floating Rate
Notes will be the amount of interest accrued from and including the Original
Issue Date or from and including the last Interest Payment Date to which
interest has been paid to, but excluding, such Interest Payment Date or date of
Maturity, as the case may be (an "Interest Period").
With respect to a Floating Rate Note, accrued interest will be calculated
by multiplying the principal amount of such Floating Rate Note by an accrued
interest factor. Such accrued interest factor will be computed by adding the
interest factors calculated for each day in the Interest Period or from the last
date from which accrued interest is being calculated. Unless otherwise specified
in the applicable Pricing Supplement, the interest factor for each such day is
computed by dividing the interest rate applicable on such day by 360, in the
cases of CD Rate Notes, Commercial Paper Rate Notes, Federal Funds Rate Notes,
J.J. Kenny Rate Notes, LIBOR Notes, Prime Rate Notes and 11th District Cost of
Funds Rate Notes, or by the actual number of days in the year, in the case of
Treasury Rate Notes and CMT Rate Notes.
Unless otherwise specified in the applicable Pricing Supplement, the
interest rate in effect on each day will be (i) if such day is an Interest Reset
Date, the interest rate as determined, in accordance with the procedures
hereinafter set forth, with respect to the Interest Determination Date (as
defined below) pertaining to such Interest Reset Date, or (ii) if such day is
not an Interest Reset Date, the interest rate for the immediately preceding
Interest Reset Date (or, if none, the Initial Interest Rate), subject in either
case to any Maximum or Minimum Interest Rate limitation, or any other interest
rate limitation, referred to above and to any adjustment by a Spread and/or
Spread Multiplier referred to above; provided, however, that the interest rate
in effect from the Original Issue Date to the first interest Reset Date will be
the Initial Interest Rate.
Unless otherwise specified in the applicable Pricing Supplement, interest
will be payable, in the case of Floating Rate Notes that reset daily, weekly or
monthly, on the third Wednesday of each month or on the third Wednesday of
March, June, September and December of each year, as specified in the applicable
Pricing Supplement; in the case of Floating Rate Notes that reset quarterly, on
the third Wednesday of March, June, September and December of each year; in the
case of Floating Rate Notes that reset semi-annually, on the third Wednesday of
the two months specified in the applicable Pricing Supplement; in the case of
Floating Rate Notes that reset annually, on the third Wednesday of the month
specified in the applicable Pricing Supplement; and, in each case, at Maturity.
Unless otherwise specified in the applicable Pricing Supplement, if an Interest
Payment Date with respect to any Floating Rate Note would otherwise be a day
that is not a Business Day with respect to such Floating Rate Note, such
Interest Payment Date shall be postponed to the next succeeding Business Day
with respect to such Floating Rate Note, except in the case of LIBOR Notes, if
such day would fall in the next succeeding calendar month, such Interest Payment
Date with respect to such LIBOR Note will be the immediately preceding Business
Day. Any payment of principal (and premium, if any) and interest required to be
made on a Floating Rate Note on a date of Maturity that is not a Business Day
will be made on the next succeeding Business Day with respect to such Floating
Rate Note (with the same force and effect as if made on such date of Maturity,
and no additional interest shall accrue as a result of any such delayed
payment).
The interest rate applicable to each Interest Reset Period commencing on
the Interest Reset Date with respect to such Interest Reset Period will be the
rate determined as of the applicable Interest Determination Date on or prior to
the Calculation Date (as defined below). Unless otherwise specified in the
applicable Pricing Supplement, the "Interest Determination Date" pertaining to
an Interest Reset Date will be (i) the second Business Day next preceding such
Interest Reset Date, in the case of CD Rate Notes, CMT Rate Notes, Commercial
Paper Rate Notes, Federal Funds Rate Notes, J.J. Kenny Rate Notes and Prime Rate
Notes (ii) the second London Banking Day next preceding such Interest Reset
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Date, in the case of LIBOR Notes, (iii) the last working day of the month next
preceding the applicable Interest Reset Date on which the FHLB of San Francisco
(as defined below) publishes the 11th District Cost of Funds Index (as defined
below), in the case of 11th District Cost of Funds Rate Notes, and (iv) the day
of the week in which such Interest Reset Date falls on which Treasury bills of
the applicable Index Maturity are auctioned, in the case of Treasury Rate Notes.
Treasury bills are normally sold at auction on Monday of each week, unless that
day is a legal holiday, in which case the auction is normally held on the
following Tuesday, except that such auction may be held on the preceding Friday.
If, as the result of a legal holiday, an auction is so held on the preceding
Friday, such Friday will, unless otherwise specified in the applicable Pricing
Supplement, be the Interest Determination Date pertaining to the Interest Reset
Date occurring in the next succeeding week.
Unless otherwise specified in the applicable Pricing Supplement, the
"Calculation Date", if applicable, pertaining to an Interest Determination Date
will be the earlier of (i) the tenth calendar day after such Interest
Determination Date or, if any such day is not a Business Day, the next
succeeding Business Day and (ii) the Business Day preceding the applicable
Interest Payment Date or Maturity, as the case may be.
Unless otherwise specified in the applicable Pricing Supplement, Citibank,
N.A. will be the calculation agent (the "Calculation Agent") with respect to the
Floating Rate Notes. Upon the request of the Holder of any Floating Rate Note,
the Calculation Agent will provide the interest rate then in effect and, if
determined, the interest rate that will become effective on the next Interest
Reset Date with respect to such Floating Rate Note.
CD Rate Notes
CD Rate Notes will bear interest at the interest rates (calculated with
reference to the CD Rate and the Spread and/or Spread Multiplier, if any)
specified in the CD Rate Notes and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the "CD
Rate" means, with respect to any Interest Determination Date, the rate on such
date for negotiable certificates of deposit having the applicable Index
Maturity, as published by the Board of Governors of the Federal Reserve System
in "Statistical Release H.15(519), Selected Interest Rates", or any successor
publication of the Board of Governors of the Federal Reserve System
("H.15(519)") under the heading "CDs (Secondary Market)" or, if not so published
by 9:00 a.m., New York City time, on the Calculation Date pertaining to such
Interest Determination Date, the CD Rate will be the rate on such Interest
Determination Date for negotiable certificates of deposit of the applicable
Index Maturity as published by the Federal Reserve Bank of New York in its daily
statistical release, "Composite 3:30 p.m. Quotations for U.S. Government
Securities", or any successor publication of the Federal Reserve Bank of New
York ("Composite Quotations") under the heading "Certificates of Deposit". If
such rate is not yet published in Composite Quotations by 3:00 p.m., New York
City time, on the Calculation Date pertaining to such Interest Determination
Date, then the CD Rate on such Interest Determination Date will be calculated by
the Calculation Agent and will be the arithmetic mean of the secondary market
offered rates as of 10:00 a.m., New York City time, on such Interest
Determination Date, of three leading nonbank dealers in negotiable U.S. dollar
certificates of deposit in The City of New York selected by the Calculation
Agent for negotiable certificates of deposit of major United States money center
banks (in the market for negotiable certificates of deposit) with a remaining
maturity closest to the applicable Index Maturity in a denomination of U.S.
$5,000,000; provided, however, that if the dealers selected as aforesaid by the
Calculation Agent are not quoting such rates as mentioned in this sentence, the
rate of interest in effect for the applicable period will be the rate of
interest in effect on such Interest Determination Date.
CD Rate Notes, like other Notes, are not deposit obligations of a bank and
are not insured by the Federal Deposit Insurance Corporation.
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CMT Rate Notes
CMT Rate Notes will bear interest at the interest rates (calculated with
references to the CMT Rate and the Spread and/or Spread Multiplier, if any)
specified in the CMT Rate Notes and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the "CMT
Rate" means, with respect to any Interest Determination Date relating to a CMT
Rate Note, the rate displayed on the Designated CMT Telerate Page under the
caption "...Treasury Constant Maturities...Federal Reserve Board Release
H.15...Mondays Approximately 3:45 P.M.", under the column for the Designated CMT
Maturity Index for (i) if the Designated CMT Telerate Page is 7055, the rate on
such Interest Determination Date and (ii) if the Designated CMT Telerate Page is
7052, the week, or the month, as applicable, ended immediately preceding the
week in which the related Interest Determination Date occurs. If such rate is no
longer displayed on the relevant page, or if not displayed by 3:00 p.m., New
York City time, on the related Calculation Date, then the CMT Rate for such
Interest Determination Date will be such treasury constant maturity rate for the
Designated CMT Maturity Index as published in the relevant H.15(519). If such
rate is no longer published, or if not published by 3:00 p.m., New York City
time, on the related Calculation Date, then the CMT Rate for such Interest
Determination Date will be such treasury constant maturity rate for the
Designated CMT Maturity Index (or other United States Treasury rate for the
Designated CMT Maturity Index) for the Interest Determination Date with respect
to such Interest Reset Date as may then be published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury that the Calculation Agent determines to be comparable to the rate
formerly displayed on the Designated CMT Telerate Page and published in the
relevant H.15(519). If such information is not provided by 3:00 p.m., New York
City time, on the related Calculation Date, then the CMT Rate for the Interest
Determination Date will be calculated by the Calculation Agent and will be a
yield to maturity, based on the arithmetic mean of the secondary market closing
offer side prices as of approximately 3:30 p.m. (New York City time) on the
Interest Determination Date reported, according to their written records, by
three leading primary United States government securities dealers (each, a
"Reference Dealer") in The City of New York selected by the Calculation Agent
(from five such Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the
lowest)), for the most recently issued direct noncallable fixed rate obligations
of the United States ("Treasury Notes") with an original maturity of
approximately the Designated CMT Maturity Index and a remaining term to maturity
of not less than such Designated CMT Maturity Index minus one year. If the
Calculation Agent cannot obtain three such Treasury Note quotations, the CMT
Rate for such Interest Determination Date will be calculated by the Calculation
Agent and will be a yield to maturity based on the arithmetic mean of the
secondary market offer side prices as of approximately 3:30 p.m. (New York City
time) on the Interest Determination Date of three Reference Dealers in The City
of New York (from five such Reference Dealers selected by the Calculation Agent
and eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the
lowest)), for Treasury Notes with an original maturity of the number of years
that is the next highest to the Designated CMT Maturity Index and a remaining
term to maturity closest to the Designated CMT Maturity Index and in an amount
of at least $100 million. If three or four (and not five) of such Reference
Dealers are quoting as described above, then the CMT Rate will be based on the
arithmetic mean of the offer prices obtained and neither the highest nor the
lowest of such quotes will be eliminated; provided, however, that if fewer than
three Reference Dealers selected by the Calculation Agent are quoting as
described herein, the CMT Rate will be the CMT Rate in effect on such Interest
Determination Date. If two Treasury Notes with an original maturity as described
in the second preceding sentence have remaining terms to maturity equally close
to the Designated CMT Maturity Index, the quotes for the CMT Rate Note with the
shorter remaining term to maturity will be used.
"Designated CMT Telerate Page" means the display on the Dow Jones Telerate
Service on the page designated in the applicable Pricing Supplement (or any
other page as may replace such page on that service for the purposes of
displaying Treasury Constant Maturities as reported in H.15(519)), for the
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purpose of displaying Treasury Constant Maturities as reported in H.15(519). If
no such page is specified in the applicable Pricing Supplement, the Designated
CMT Telerate Page shall be 7052, for the most recent week.
"Designated CMT Maturity Index" means the original period to maturity of
the U.S. Treasury securities (either 1, 2, 3, 5, 7, 10, 20, or 30 years)
specified in the applicable Pricing Supplement with respect to which the CMT
Rate will be calculated. If no such maturity is specified in the applicable
Pricing Supplement, the Designated CMT Maturity Index shall be two years.
Commercial Paper Rate Notes
Commercial Paper Rate Notes will bear interest at the interest rates
(calculated with reference to the Commercial Paper Rate and the Spread and/or
Spread Multiplier, if any) specified in the Commercial Paper Rate Notes and in
the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the
"Commercial Paper Rate" means, with respect to any Interest Determination Date,
the Money Market Yield (as defined below) on such date of the rate for
commercial paper having the applicable Index Maturity, as published in H.15(519)
under the heading "Commercial Paper" or, if unreliable, under such other heading
representing commercial paper issued by non-financial entitities whose bond
rating is "AA", or the equivalent, from a nationally recognized statistical
rating organization, or, if not so published by 9:00 a.m., New York City time,
on the Calculation Date pertaining to such Interest Determination Date, then the
Commercial Paper Rate will be the Money Market Yield on such Interest
Determination Date of the rate for commercial paper having the applicable Index
Maturity, as published in Composite Quotations under the heading "Commercial
Paper". If such rate is not yet published in Composite Quotations by 3:00 p.m.,
New York City time, on the Calculation Date pertaining to such Interest
Determination Date, the Commercial Paper Rate will be the Money Market Yield of
the arithmetic mean of the offered rates as of 11:00 a.m., New York City time,
on such Interest Determination Date, of three leading dealers of commercial
paper in The City of New York selected by the Calculation Agent for commercial
paper placed for industrial issuers whose bond rating is "AA", or the
equivalent, from a nationally recognized rating agency, having the applicable
Index Maturity; provided, however, that if the dealers selected as aforesaid by
the Calculation Agent are not quoting offered rates as mentioned in this
sentence, the rate of interest in effect for the applicable period will be the
rate of interest in effect on such Interest Determination Date.
"Money Market Yield" means a yield (expressed as a percentage) calculated
in accordance with the following formula:
D X 360
Money Market Yield = ------------------- X 100
360 - (D X M)
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal, and "M" refers to the actual
number of days in the period for which interest is being calculated.
Federal Funds Rate Notes
Federal Funds Rate Notes will bear interest at the interest rates
(calculated with reference to the Federal Funds Rate and the Spread and/or
Spread Multiplier, if any) specified in the Federal Funds Rate Notes and in the
applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the
"Federal Funds Rate" means, with respect to any Interest Determination Date, the
rate on such date for Federal Funds as published in H.15(519) under the heading
"Federal Funds (Effective)" or, if not so published by 9:00 a.m., New York City
time, on the Calculation Date pertaining to such Interest Determination Date,
the Federal Funds Rate will be the rate on such Interest Determination Date as
published in Composite Quotations under the heading "Federal Funds/Effective
Rate". If such rate is not yet published by 3:00 p.m., New York City time, on
the Calculation Date pertaining to such Interest Determination Date, the Federal
Funds Rate for
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such Interest Determination Date will be calculated by the Calculation Agent and
will be the arithmetic mean of the rates for the last transaction in overnight
Federal Funds arranged by three leading brokers of Federal Funds transactions in
The City of New York selected by the Calculation Agent as of 9:00 a.m., New York
City time, on such Interest Determination Date; provided, however, that if the
brokers selected as aforesaid by the Calculation Agent are not quoting such
rates as mentioned in this sentence, the rate of interest in effect for the
applicable period will be the rate of interest in effect on such Interest
Determination Date.
J.J. Kenny Rate Notes
J.J. Kenny Rate Notes will bear interest at the interest rates (calculated
with reference to the J.J. Kenny Rate and the Spread and/or Spread Multiplier,
if any) specified in the J.J. Kenny Rate Notes and in the applicable Pricing
Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the "J.J.
Kenny Rate" means, with respect to any Interest Determination Date relating to a
J.J. Kenny Rate Note, the rate in the high grade weekly index (the "Weekly
Index") on such date made available by Kenny Information Systems ("Kenny") to
the Calculation Agent. The Weekly Index is, and shall be, based upon 30-day
yield evaluations at par of bonds, the interest of which is exempt from Federal
income taxation under the Internal Revenue Code of 1986, as amended, of not less
than five high grade component issuers selected by Kenny which shall include,
without limitation, issuers of general obligation bonds. The specific issuers
included among the component issuers may be changed from time to time by Kenny
in its discretion. The bonds on which the Weekly Index is based shall not
include any bonds on which the interest is subject to a minimum tax or similar
tax under the Internal Revenue Code of 1986, as amended, unless all tax-exempt
bonds are subject to such tax. In the event Kenny fails to make available such
Weekly Index prior to the relevant Calculation Date, a successor indexing agent
will be selected by the Calculation Agent, such index to reflect the prevailing
rate for bonds rated in the highest short-term rating category by Moody's
Investors Service, Inc. and Standard & Poor's Corporation in respect of issuers
most closely resembling the high grade component issuers selected by Kenny for
its Weekly Index, the interest on which is (A) variable on a weekly basis, (B)
exempt from Federal income taxation under the Internal Revenue Code of 1986, as
amended, and (C) not subject to a minimum tax or similar tax under the Internal
Revenue Code of 1986, as amended, unless all tax-exempt bonds are subject to
such tax. If such successor indexing agent is not available, the rate for any
Interest Determination Date shall be 67% of the rate determined if the Treasury
Rate had been originally selected as the interest rate for the Notes. The
Calculation Agent shall calculate the J.J. Kenny Rate in accordance with the
foregoing. At the request of a Holder of a Floating Rate Note bearing interest
at the J.J. Kenny Rate, the Calculation Agent will provide such holder with the
interest rate that will become effective as of the next Interest Reset Date.
LIBOR Notes
LIBOR Notes will bear interest at the rates (calculated with reference to
LIBOR and the Spread and/or Spread Multiplier, if any) specified in such LIBOR
Notes and in any applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, "LIBOR"
means the rate determined by the Calculation Agent in accordance with the
following provisions:
(i) With respect to an Interest Determination Date relating to a LIBOR
Note or any Floating Rate Note for which the interest rate is determined
with reference to LIBOR (a "LIBOR Interest Determination Date"), LIBOR will
be either: (a) if "LIBOR Reuters" is specified in the applicable Pricing
Supplement, the arithmetic mean of the offered rates (unless the specified
Designated LIBOR Page (as defined below) by its terms provides only for a
single rate, in which case such single rate shall be used) for deposits in
the Index Currency having the Index Maturity designated in the applicable
Pricing Supplement, commencing on the second London Banking Day immediately
following such LIBOR Interest Determination Date, that appear on the
Designated LIBOR Page specified in the applicable Pricing Supplement as of
11:00 A.M., London time, on such LIBOR Interest Determination Date, if at
least two such offered rates appear (unless, as aforesaid, only a
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single rate is required) on such Designated LIBOR Page, or (b) if "LIBOR
Telerate" is specified in the applicable Pricing Supplement or if neither
"LIBOR Reuters" nor "LIBOR Telerate" is specified as the method for
calculating LIBOR, the rate for deposits in the Index Currency having the
Index Maturity designated in the applicable Pricing Supplement, commencing
on the second London Banking Day immediately following such LIBOR Interest
Determination Date that appears on the Designated LIBOR Page specified in
the applicable Pricing Supplement as of 11:00 A.M., London time, on such
LIBOR Interest Determination Date. If fewer than two such offered rates
appear (unless the specified Designated LIBOR Page by its terms provides
only for a single rate, in which case such single rate shall be used), or
if no such rate appears, as applicable, LIBOR in respect of the related
LIBOR Interest Determination Date will be determined in accordance with the
provisions described in clause (ii) below.
(ii) With respect to a LIBOR Interest Determination Date on which
fewer than two offered rates appear, or no rate appears, as the case may
be, on the applicable Designated LIBOR Page as specified in clause (i)
above, the Calculation Agent will request the principal London offices of
each of four major reference banks in the London interbank market, as
selected by the Calculation Agent, to provide the Calculation Agent with
its offered quotation for deposits in the Index Currency for the period of
the Index Maturity designated in the applicable Pricing Supplement,
commencing on the second London Banking Day immediately following such
LIBOR Interest Determination Date, to prime banks in the London interbank
market at approximately 11:00 A.M., London time, on such LIBOR Interest
Determination Date and in a principal amount that is representative for a
single transaction in such Index Currency in such market at such time. If
at least two such quotations are provided, LIBOR determined on such LIBOR
Interest Determination Date will be the arithmetic mean of such quotations.
If fewer than two quotations are provided, LIBOR determined on such LIBOR
Interest Determination Date will be the arithmetic mean of the rates quoted
at approximately 11:00 A.M., in the applicable Principal Financial Center,
on such LIBOR Interest Determination Date by three major banks in such
Principal Financial Center selected by the Calculation Agent for loans in
the Index Currency to leading European banks, having the Index Maturity
designated in the applicable Pricing Supplement and in a principal amount
that is representative for a single transaction in such Index Currency in
such market at such time; provided, however, that if the banks so selected
by the Calculation Agent are not quoting as mentioned in this sentence,
LIBOR determined as of such LIBOR Interest Determination Date will be LIBOR
in effect on such LIBOR Interest Determination Date.
"Index Currency" means the currency (including composite currencies)
specified in the applicable Pricing Supplement as the currency for which LIBOR
shall be calculated. If no such currency is specified in the applicable Pricing
Supplement, the Index Currency shall be United States dollars.
"Designated LIBOR Page" means either (a) if "LIBOR Reuters" is specified in
the applicable Pricing Supplement, the display on the Reuters Monitor Money
Rates Service for the purpose of displaying the London interbank rates of major
banks for the applicable Index Currency, or (b) if "LIBOR Telerate" is specified
in the applicable Pricing Supplement or neither "LIBOR Reuters" nor "LIBOR
Telerate" is specified as the method for calculating LIBOR, the display on the
Dow Jones Telerate Service for the purpose of displaying the London interbank
rates of major banks for the applicable Index Currency.
"Principal Financial Center" will generally be the capital city of the
country of the specified Index Currency, except that with respect to United
States dollars, Deutsche Marks, Dutch Guilders, Italian Lire, Swiss Francs and
ECUs, the Principal Financial Center shall be The City of New York, Frankfurt,
Amsterdam, Milan, Zurich and Luxembourg, respectively.
Treasury Rate Notes
Treasury Rate Notes will bear interest at the interest rate (calculated
with reference to the Treasury Rate and the Spread and/or Spread Multiplier, if
any) specified in the Treasury Rate Notes and in the applicable Pricing
Supplement.
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Unless otherwise specified in the applicable Pricing Supplement, the
"Treasury Rate" means, with respect to any Interest Determination Date, the rate
for the auction held on such Interest Determination Date of direct obligations
of the United States ("Treasury bills") having the applicable Index Maturity as
published in H.15(519) under the heading "U.S. Government Securities -- Treasury
bills -- auction average (investment)" or, if not so published by 9:00 a.m., New
York City time, on the Calculation Date pertaining to such Interest
Determination Date, the auction average rate (expressed as a bond equivalent,
rounded to the nearest one one-hundredth of a percent, with five one-thousandths
of a percent rounded upward, on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) as otherwise announced by the United
States Department of the Treasury. In the event that the results of the auction
of Treasury bills having the applicable Index Maturity are not published or
announced as provided above by 3:00 p.m., New York City time, on such
Calculation Date, or if no such auction is held on such Interest Determination
Date, then the Treasury Rate shall be calculated by the Calculation Agent and
shall be a yield to maturity (expressed as a bond equivalent, rounded to the
nearest one one-hundredth of a percent, with five one-thousandths of a percent
rounded upward, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) of the arithmetic mean of the secondary market bid
rates, as of approximately 3:30 p.m., New York City time, on such Interest
Determination Date, of three leading primary United States government securities
dealers selected by the Calculation Agent for the issue of Treasury bills with a
remaining maturity closest to the applicable Index Maturity; provided, however,
that if the dealers selected as aforesaid by the Calculation Agent are not
quoting bid rates as mentioned in this sentence, the interest rate for the
applicable period will be the interest rate in effect on such Interest
Determination Date.
Prime Rate Notes
Prime Rate Notes will bear interest at the interest rate (calculated with
reference to the Prime Rate and the Spread and/or Spread Multiplier, if any)
specified in the Prime Rate Notes and in the applicable Pricing Supplement,
except that the initial interest rate for each Prime Rate Note will be the rate
specified in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the "Prime
Rate" means, with respect to any Interest Determination Date, the rate on such
date as published by the Board of Governors of the Federal Reserve System in
H.15(519) under the heading "Bank Prime Loan". If such rate is not published by
9:00 a.m., New York City time, on the Calculation Date pertaining to such
Interest Determination Date, the Prime Rate will be determined by the
Calculation Agent and will be the arithmetic mean of the rates of interest
publicly announced by each bank named on the "Reuters Screen USPRIME1 Page" (as
defined below) as such bank's prime rate or base lending rate as in effect for
such Interest Determination Date. "Reuters Screen USPRIME1 Page" means the
display designated as page "USPRIME1" on the Reuters Monitor Money Rates Service
(such term to include such other page as may replace the USPRIME1 page on that
Service for the purpose of displaying prime rates or base lending rates of major
United States banks). If fewer than four such rates but more than one such rate
appear on the Reuters Screen USPRIME1 Page for such Interest Determination Date,
the Prime Rate will be determined by the Calculation Agent and will be the
arithmetic mean of the prime rates quoted on the basis of the actual number of
days in the year divided by 360 as of the close of business on such Interest
Determination Date by four major money center banks in The City of New York
selected by the Calculation Agent from a list approved by the Company. If fewer
than two such rates appear on the Reuters Screen USPRIME1 Page, the Prime Rate
will be calculated by the Calculation Agent and will be determined as the
arithmetic mean of the prime rates furnished in The City of New York by the
appropriate number of substitute banks or trust companies organized and doing
business under the laws of the United States, or any state thereof, in each case
having total equity capital of at least $500,000,000 and being subject to
supervision or examination by Federal or state authority, selected by the
Calculation Agent from a list approved by the applicable Issuer to provide such
rate or rates; provided, however, that if the banks or trust companies selected
as aforesaid by the Calculation Agent from a list approved by the applicable
Issuer are not quoting as mentioned in this sentence, the rate of
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interest in effect for the applicable period will be the rate of interest in
effect on such Interest Determination Date.
11th District Cost of Funds Rate Notes
11th District Cost of Funds Rate Notes will bear interest at the interest
rates (calculated with reference to the 11th District Cost of Funds Rate and the
Spread and/or Spread Multiplier, if any) specified in the 11th District Cost of
Funds Rate Notes and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, "11th
District Cost of Funds Rate" means, with respect to any Interest Determination
Date relating to an 11th District Cost of Funds Rate Note, the rate equal to the
monthly weighted average cost of funds for the calendar month immediately
preceding the month in which such Interest Determination Date falls, as set
forth under the caption "11th District" on Telerate Page 7058 as of 11:00 a.m.,
San Francisco time, on such Interest Determination Date. If such rate does not
appear on Telerate Page 7058 on any related Interest Determination Date, the
11th District Cost of Funds Rate for such Interest Determination Date shall be
the monthly weighted average cost of funds paid by member institutions of the
11th Federal Home Loan Bank District that was most recently announced (the "11th
District Cost of Funds Index") by the Federal Home Loan Bank of San Francisco
(the "FHLB of San Francisco") as such cost of funds for the calendar month
immediately preceding the date of such announcement. If the FHLB of San
Francisco fails to announce such rate for the calendar month immediately
preceding such Interest Determination Date, then the 11th District Cost of Funds
Rate determined as of such Interest Determination Date will be the 11th District
Cost of Funds Rate in effect on such Interest Determination Date.
CURRENCY INDEXED NOTES
General
The Issuers may from time to time offer Currency Indexed Notes, the
principal amount of which payable at the Maturity Date is determined by
reference to the rate of exchange between the currency or composite currency in
which such Notes are denominated (the "Denominated Currency") and the other
currency or currencies or composite currency or composite currencies specified
as the Indexed Currency (the "Indexed Currency") in the applicable Pricing
Supplement, or as determined in such other manner as may be specified in the
applicable Pricing Supplement. Unless otherwise specified in the applicable
Pricing Supplement, Holders of Currency Indexed Notes will be entitled to
receive a principal amount in respect of such Currency Indexed Notes exceeding
the amount designated as the face amount of such Currency Indexed Notes in the
applicable Pricing Supplement (the "Face Amount") if, at the Maturity Date, the
rate at which the Denominated Currency can be exchanged for the Indexed Currency
is greater than the rate of such exchange designated as the Base Exchange Rate,
expressed in units of the Indexed Currency per one unit of the Denominated
Currency, in the applicable Pricing Supplement (the "Base Exchange Rate").
Holders of Currency Indexed Notes will be entitled to receive a principal amount
in respect of such Currency Indexed Notes less than the Face Amount of such
Currency Indexed Notes if, at the Maturity Date, the rate at which the
Denominated Currency can be exchanged for the Indexed Currency is less than such
Base Exchange Rate. The Base Exchange Rate is determined as described below
under "Payment of Principal and Interest". Information as to the relative
historical value (which information is not necessarily indicative of relative
future value) of the applicable Denominated Currency against the applicable
Indexed Currency, any exchange controls applicable to such Denominated Currency
or Indexed Currency and certain tax consequences to holders will be set forth in
the applicable Pricing Supplement. See "Currency-Related Risk Factors -- Foreign
Currency Risks".
Unless otherwise specified in the applicable Pricing Supplement, the term
"Exchange Rate Day" shall mean any day (a) which is a Business Day in The City
of New York and (b)(i) if the Denominated Currency or Indexed Currency is any
currency or composite currency other than the U.S. dollar or the ECU, a Business
Day in the principal financial center of the country of such Denominated
Currency or
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Indexed Currency or (ii) if the Denominated Currency or Indexed Currency is the
ECU, a Business Day with respect to the ECU.
Payment of Principal and Interest
Unless otherwise specified in the applicable Pricing Supplement, interest,
if any, on the Notes will be payable by the Issuer thereof in the Denominated
Currency based on the Face Amount of the Currency Indexed Notes and at the rate
and times and in the manner set forth herein and in the applicable Pricing
Supplement.
Unless otherwise specified in the applicable Pricing Supplement, principal
of a Currency Indexed Note will be payable by the Issuer thereof in the
Denominated Currency at Maturity in an amount equal to the Face Amount of the
Currency Indexed Note, plus or minus an amount of the Denominated Currency
determined by the Exchange Rate Agent by reference to the difference between the
Base Exchange Rate and the rate at which the Denominated Currency can be
exchanged for the Indexed Currency as determined on the second Exchange Rate Day
(the "Exchange Rate Date") prior to Maturity by the Exchange Rate Agent based
upon the indicative quotation, selected by such Exchange Rate Agent at
approximately 11:00 a.m., New York City time, on such Exchange Rate Date, for
the Indexed Currency (spot bid quotation for the Denominated Currency) which
will yield the largest number of units of the Indexed Currency per one unit of
the Denominated Currency, for an amount of Indexed Currency equal to the Face
Amount of such Currency Indexed Note multiplied by the Base Exchange Rate with
the Denominated Currency for settlement at Maturity (such rate of exchange, as
so determined and expressed in units of the Indexed Currency per one unit of the
Denominated Currency, is hereafter referred to as the "Spot Rate"). Unless
otherwise provided in the Pricing Supplement, such selection shall be made from
among the quotations appearing on the display "page" within the Reuters or
Telerate Monitor Foreign Exchange Service, as may be agreed to by such Issuer
and such Exchange Rate Agent (or, if such display "page" is not available or
such Indexed Currency or Denominated Currency is a composite currency for which
separate current composite currency quotations are not available, such other
comparable display or other comparable manner of obtaining quotations as may be
agreed to by such Issuer and such Exchange Rate Agent), used to determine the
Spot Rate. The principal amount of the Currency Indexed Notes determined by the
Exchange Rate Agent to be payable at Maturity will be payable to the Holders
thereof in the manner set forth herein and in the applicable Pricing Supplement.
In the absence of manifest error, the determination by the Exchange Rate Agent
of the Spot Rate and the principal amount of Currency Indexed Notes payable at
Maturity thereof shall be final and binding on such Issuer and the holders of
such Currency Indexed Notes.
The formula to be used by the Exchange Rate Agent to determine the
principal amount of a Currency Indexed Note payable at the Maturity Date will be
specified in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, in the
event of any redemption or repayment of a Currency Indexed Note prior to its
scheduled Maturity Date, the term "Maturity" used above would refer to the
redemption or repayment date of such Currency Indexed Note.
OTHER INDEXED NOTES
The Notes may be issued as Indexed Notes, other than Currency Indexed
Notes, the principal amount of which payable at Maturity or the interest (or
premium, if any) thereon, or both, may be determined by reference to the price
of one or more specified securities or commodities, to one or more securities or
commodities exchange indices or other indices or by other similar methods or
formulas. The Pricing Supplement relating to such an Indexed Note will describe,
as applicable, the method by which the amount of interest payable and the amount
of principal payable at the Maturity Date in respect of such Indexed Note will
be determined, certain special tax consequences to holders of such Notes,
certain risks associated with an investment in such Notes and other information
relating to such Notes.
Unless otherwise specified in the applicable Pricing Supplement, (a) for
the purpose of determining whether Holders of the requisite principal amount of
Securities outstanding under the Senior Indenture
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have made a demand or given a notice or waiver or taken any other action, the
outstanding principal amount of Indexed Notes will be deemed to be the face
amount thereof, and (b) in the event of an acceleration of the Maturity of an
Indexed Note, the principal amount payable to the Holder of such Note upon
acceleration will be the principal amount determined by reference to the formula
by which the principal amount of such Note would be determined on the Maturity
Date thereof, as if the date of acceleration were the Maturity Date.
SUBSEQUENT INTEREST PERIODS
The Pricing Supplement relating to each Note will indicate whether the
Issuer thereof has the option with respect to such Note to reset the interest
rate, in the case of a Fixed Rate Note, or to reset the Spread and/or Spread
Multiplier, in the case of a Floating Rate Note, and, if so, the date or dates
on which such interest rate or such Spread and/or Spread Multiplier, as the case
may be, may be reset (each an "Optional Reset Date"). If an Issuer has such
option with respect to any Note, the following procedures shall apply, unless
modified as set forth in the applicable Pricing Supplement.
Such Issuer may at any time and from time to time exercise such option with
respect to a Note by notifying the Trustee of such exercise at least 50 but not
more than 60 days prior to an Optional Reset Date for such Note. Not later than
10 days after receipt of such notice from such Issuer but in any event not later
than 40 days prior to such Optional Reset Date, the Trustee will mail to the
Holder of such Note a notice (the "Reset Notice") setting forth (i) the election
of such Issuer to reset the interest rate, in the case of a Fixed Rate Note, or
the Spread and/or Spread Multiplier, in the case of a Floating Rate Note, (ii)
such new interest rate or such new Spread and/or Spread Multiplier, as the case
may be, and (iii) the provisions, if any, for redemption or repayment during the
period from such Optional Reset Date to the next Optional Reset Date or, if
there is no such next Optional Reset Date, to Maturity of such Note (each such
period a "Subsequent Interest Period"), including the date or dates on which or
the period or periods during which the price or prices at which such redemption
may occur during such Subsequent Interest Period.
Notwithstanding the foregoing, not later than 20 days prior to an Optional
Reset Date for a Note, such Issuer may, at its option, revoke the interest rate,
in the case of a Fixed Rate Note, or the Spread and/or Spread Multiplier, in the
case of a Floating Rate Note, provided for in the Reset Notice and establish an
interest rate, in the case of a Fixed Rate Note, or a Spread and/or Spread
Multiplier, in the case of a Floating Rate Note, that is higher than the
interest rate, Spread and/or Spread Multiplier, as the case may be, provided for
in the Reset Notice, for the Subsequent Interest Period commencing on such
Optional Reset Date by causing the Trustee to transmit notice of such higher
interest rate or higher Spread and/or Spread Multiplier, as the case may be, to
the Holder of such Note. Such notice shall be irrevocable. All Notes with
respect to which the interest rate or Spread and/or Spread Multiplier is reset
on an Optional Reset Date and with respect to which the Holders of such Notes
have not tendered such Notes for repayment (or have validly revoked any such
tender pursuant to the next succeeding paragraph) will bear such higher interest
rate, in the case of a Fixed Rate Note, or higher Spread and/or Spread
Multiplier, in the case of a Floating Rate Note, whether or not tendered for
repayment.
If such Issuer elects to reset the interest rate or the Spread and/or
Spread Multiplier of a Note, the Holder of such Note will have the option to
elect repayment of such Note by such Issuer on any Optional Reset Date at a
price equal to the aggregate principal amount thereof outstanding on, plus any
accrued interest to, such Optional Reset Date. In order for a Note to be so
repaid on an Optional Reset Date, the Trustee or any other person designated by
such Issuer for such purpose must receive at least 25 days but not more than 35
days prior to such Optional Reset Date (i) if such Note is a Certificated Note,
the Note with the form entitled "Option to Elect Repayment" on the reverse side
of the Note duly completed or (ii) if such Note is a Book-Entry Note, such
notices as may be set forth in the applicable Pricing Supplement. The repayment
option may be exercised by the Holder of a Note for less than the aggregate
principal amount of the Note then outstanding; provided, however, that the
principal amount of the Note remaining outstanding after repayment is an
authorized denomination. A Holder who has tendered a note for repayment pursuant
to a Reset Notice may, by delivery by the close of business on the tenth day
prior
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to such Optional Reset Date of written notice to the Senior Trustee, revoke any
such tender for repayment.
If a Note is represented by a Global Security, the Depositary's nominee
will be the holder of such Note and therefore will be the only entity that can
exercise a right to repayment. In order to ensure that the Depositary's nominee
will exercise timely a right to repayment with respect to a particular Note, the
beneficial owner of such Note must instruct the broker or other direct or
indirect participant through which it holds an interest in such Note to notify
the Depositary of its desire to exercise a right of repayment. Different firms
have different cut-off times for accepting instructions from their customers
and, accordingly, each beneficial owner should consult the broker or other
direct or indirect participant through which it holds an interest in a Note in
order to ascertain the cut-off time by which such an instruction must be given
in order for timely notice to be delivered to the Depositary.
EXTENSION OF MATURITY
The Pricing Supplement relating to each Note (other than an Amortizing
Note) will indicate whether the Maturity Date of such Note may be extended, and
if so, whether such Maturity Date may be extended at the option of the Issuer
thereof or the Holder of such Note, or both, for one or more periods (each an
"Extension Period") up to but not beyond the date (the "Final Maturity Date")
set forth in such Pricing Supplement.
If an Issuer has such option with respect to any Note (other than an
Amortizing Note), the following procedures shall apply, unless modified as set
forth in the applicable Pricing Supplement. Such Issuer may at any time and from
time to time exercise such option with respect to a Note (other than an
Amortizing Note) by notifying the Trustee of such exercise at least 50 but not
more than 60 days prior to the Maturity Date of such Note in effect immediately
prior to the exercise of such option (the "Prior Maturity Date"). Not later than
10 days after receipt of such Notice from such Issuer but in any event not later
than 40 days prior to the Prior Maturity Date, the Trustee will mail to the
Holder of such Note a notice (the "Extension Notice") relating to such Extension
Period, setting forth (i) the election of such Issuer to extend the Prior
Maturity Date, (ii) the new Maturity Date, (iii) in the case of a Fixed Rate
Note, the interest rate applicable to the Extension Period or, in the case of a
Floating Rate Note, the Spread and/or Spread Multiplier applicable to the
Extension Period, and (iv) the provisions, if any, for redemption by the Company
or repayment to the Holder, or both, during the Extension Period, including the
date or dates on which or the period or periods during which and the price or
prices at which such redemption or repayment may occur during the Extension
Period. Upon the transmittal by the Trustee of an Extension Notice to the Holder
of a Note, the Prior Maturity Date shall be extended automatically, and, except
as modified by the Extension Notice and as described in the next paragraph, such
Note will have the same terms as prior to the transmittal of such Extension
Notice.
Notwithstanding the foregoing, not later than 20 days prior to the Prior
Maturity Date for a Note, such Issuer may, at its option, revoke the interest
rate, in the case of a Fixed Rate Note, or the Spread and/or Spread Multiplier,
in the case of a Floating Rate Note, provided for in the Extension Notice and
establish an interest rate, in the case of a Fixed Rate Note, or a Spread and/or
Spread Multiplier, in the case of a Floating Rate Note, that is higher than the
interest rate, Spread and/or Spread Multiplier, as the case may be, provided for
in the Extension Notice, for the Extension Period commencing on such Prior
Maturity Date by causing the Trustee to transmit notice of such higher interest
rate or higher Spread and/or Spread Multiplier, as the case may be, to the
Holder of such Note. Such notice shall be irrevocable. All Notes with respect to
which the Maturity Date is extended and with respect to which the Holders of
such Notes have not tendered such Notes for repayment (or have validly revoked
any such tender) pursuant to the next succeeding paragraph will bear such higher
interest rate, in the case of a Fixed Rate Note, or higher Spread and/or Spread
Multiplier, in the case of a Floating Rate Note, for the Extension Period.
If such Issuer elects to extend the Maturity Date of a Note, the Holder of
such Note will have the option to elect repayment of such Note by such Issuer on
the immediately Prior Maturity Date at a price equal to the principal amount
thereof outstanding on, plus any accrued interest to, such Prior Maturity Date.
In order for a Note to be so repaid on such Prior Maturity Date, the Trustee or
any other person
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designated by such Issuer for such purpose must receive at least 25 days but not
more than 35 days prior to such Prior Maturity Date (i) if such Note is a
Certificated Note, the Note with the form entitled "Option to Elect Repayment"
on the reverse of the Note duly completed or (ii) if such Note is a Book-Entry
Note, such notices as may be set forth in the applicable Pricing Supplement. The
repayment option may be exercised by the Holder of a Note for less than the
aggregate principal amount of the Note then outstanding; provided, however, that
the principal amount of the Note remaining outstanding after repayment is an
authorized denomination. A Holder who has tendered a Note for repayment pursuant
to an Extension Notice may, by delivery of written notice by the close of
business on the tenth day prior to such Prior Maturity date to the Trustee,
revoke any such tender for repayment.
If a Note is represented by a Global Security, see "Description of
Notes -- Subsequent Interest Periods" above for the manner by which a right to
repayment may be exercised.
If the Holder of a Note (other than an Amortizing Note) has the option to
extend the Maturity Date of such Note for one or more Extension Periods up to
but not beyond the Final Maturity Date set forth in the Pricing Supplement
relating to such Note, the following provisions shall apply, unless modified as
set forth in such Pricing Supplement. The Holder of a Note (other than an
Amortizing Note) may, at such time or times as set forth in the applicable
Pricing Supplement, exercise such option by delivery to the Trustee by the date
set forth in such Pricing Supplement of a written notice of such election (the
"Holder's Extension Notice"). Such Holder's Extension Notice will be irrevocable
and will specify the new Maturity Date. Upon the transmittal by such Holder of
such Holder's Extension Notice to the Trustee, the applicable Prior Maturity
Date shall be extended automatically, and, except as modified pursuant to this
paragraph, such Note will have the same terms as prior to the transmittal of
such Holder's Extension Notice.
REDEMPTION AND REPAYMENT
The Pricing Supplement relating to each Note will indicate either that such
Note cannot be redeemed prior to its Maturity Date or that such Note will be
redeemable at the option of the Issuer thereof on a date or dates specified
prior to such Maturity Date at a price or prices set forth in the applicable
Pricing Supplement, together with accrued interest to the date of redemption. An
Issuer may redeem any of its Notes that are redeemable and remain outstanding
either in whole or from time to time in part, upon not less than 30 nor more
than 60 days' notice to each Holder of such Note. If Notes of different tenor
and terms are to be redeemed, the applicable Issuer shall select the Notes to be
redeemed. If less than all of the Notes with like tenor and terms are to be
redeemed, the Notes to be redeemed shall be selected by the Trustee by such
method as the Trustee shall deem fair and appropriate. Unless otherwise
specified in the applicable Pricing Supplement, the Notes will not be subject to
any sinking fund.
The Pricing Supplement relating to each Note will indicate that such Note
cannot be repaid prior to its Maturity Date or that such Note will be repayable
at the option of the Holder thereof on a date or dates specified prior to its
Maturity Date at the price or prices set forth in the applicable Pricing
Supplement, together with accrued interest to the date of repayment.
Unless otherwise specified in the applicable Pricing Supplement, in order
for a Note to be repaid at the option of the Holder thereof, the Trustee or any
other person designated by the Issuer thereof must receive at least 15 days but
not more than 30 days prior to the repayment date, (i) if such Note is a
Certificated Note, the Note with the form entitled "Option to Elect Repayment"
on the reverse side of the Note duly completed or (ii) if such Note is a
Book-Entry Note, such notices as may be set forth in the applicable Pricing
Supplement. Unless otherwise specified in the applicable Pricing Supplement, the
repayment option may be exercised by the Holder of a Note for less than the
aggregate principal amount of the Note then outstanding; provided, however, that
the principal amount of the Note remaining outstanding after repayment is an
authorized denomination. Unless otherwise specified in the applicable Pricing
Supplement, exercise of the repayment option by the Holder of a Note will be
irrevocable.
If a Note is represented by a Global Security, see "Description of Notes --
Subsequent Interest Periods" above for the manner by which a right to repayment
may be exercised.
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REPURCHASE
The Issuers may at any time and from time to time purchase Notes at any
price in the open market or otherwise. Notes so purchased by any such Issuer
may, at its discretion, be held, resold or surrendered to the Trustee for
cancellation.
GLOBAL SECURITIES AND BOOK-ENTRY SYSTEM
Upon issuance, all Book-Entry Notes having the same Specified Currency,
Original Issue Date, Maturity Date, redemption provisions (if any), Interest
Payment Dates and, in the case of Fixed Rate Notes, interest rate (if any) or in
the case of Amortizing Notes, amortization schedule or, in the case of Floating
Rate Notes, Base Rate, Initial Interest Rate, Index Maturity, Interest Reset
Period and Dates, Spread and/or Spread Multiplier (if any), Minimum Interest
Rate (if any), original issue discount provisions (if any) and Maximum Interest
Rate (if any), will be represented by a single Global Security. Each Global
Security representing Book-Entry Notes will be deposited with, or on behalf of,
The Depository Trust Company, New York, New York (the "Depositary") or such
other depositary as is specified in the applicable Pricing Supplement, and
registered in the name of a nominee of the Depositary. Unless otherwise
specified in the applicable Pricing Supplement, Book-Entry Notes will not be
exchangeable for Certificated Notes and, except under the circumstances
described in the Prospectus under "Description of the Debt Securities -- Global
Securities" and as described below, will not otherwise be issuable in definitive
form.
The Depositary has advised the Issuers, the Guarantor and the Agents as
follows: The Depositary is a limited-purpose trust company organized under the
laws of the State of New York, a member of the Federal Reserve System, a
"clearing corporation" within the meaning of the New York Uniform Commercial
Code, and a "clearing agency" registered pursuant to the provisions of Section
17A of the Exchange Act. The Depositary was created to hold securities of its
participants and to facilitate the clearance and settlement of securities
transactions among its participants in such securities through electronic
book-entry changes in accounts of the participants, thereby eliminating the need
for physical movement of securities certificates. The Depositary's participants
include securities brokers and dealers (including the Agents), banks, trust
companies, clearing corporations, and certain other organizations, some of whom
(and/or their representatives) own the Depositary. Access to the Depositary's
book-entry system is also available to others, such as banks, brokers, dealers
and trust companies that clear through or maintain a custodial relationship with
a participant, either directly or indirectly.
Upon the issuance of a Global Security, the Depositary for such Global
Security, or its nominee, will credit the accounts of persons held with it with
the respective amount of the Book-Entry Notes represented by such Global
Security. Such accounts shall be designated by the Agent or Agents with respect
to such Book-Entry Notes or by the Company if such Book-Entry Notes are offered
and sold directly by the Company. Ownership of beneficial interests in such
Global Security will be limited to persons that have accounts with the
Depositary for such Global Security or its nominee ("participants") or persons
that may hold interests through participants. Ownership of beneficial interests
in such Global Security will be shown on, and the transfer of that ownership
will be effected only through, records maintained by the Depositary or its
nominee (with respect to interests of participants) for such Global Security and
on the records of participants (with respect to interests of persons other than
participants). The laws of some states require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
limits and such laws may impair the ability to transfer beneficial interests in
a Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or Holder of the Book-Entry
Notes represented by such Global Security for all purposes under the Senior
Indenture governing such Book-Entry Notes. Except as provided below, owners of
beneficial interests in a Global Security will not be entitled to have
Book-Entry Notes represented by such Global Security registered in their names,
will not receive or be entitled to receive Certificated Notes in exchange for
the
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Global Security representing such Book-Entry Notes and will not be considered
the owners or Holders thereof under the Indenture.
Principal, premium, if any, and interest payments on Book-Entry Notes
registered in the name of a Depositary or its nominee will be made to the
Depositary or its nominee, as the case may be, as the registered owner of the
Global Security representing such Book-Entry Notes. None of the Issuers, the
Guarantor, the Trustee, any Paying Agent and the Security Registrar for such
Book-Entry Notes will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of the Global Security for such Book-Entry Notes or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
The Issuers expect that the Depositary for Book-Entry Notes or its nominee,
upon receipt of any payment of principal, premium, if any, or interest, if any,
will credit immediately participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the principal amount
of the Global Security for such Book-Entry Notes as shown on the records of such
Depositary or its nominee. The Issuers also expects that payments by
participants to owners of beneficial interests in such Global Security held
through such participants will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts of
customers which are registered in "street name", and will be the responsibility
of such participants.
If the Depositary for Book-Entry Notes is at any time unwilling or unable
to continue as depositary and a successor depositary is not appointed by the
Issuer of such Notes within 90 days, such Issuer will issue Certificated Notes
in exchange for the Global Security representing such Book-Entry Notes. In
addition, such Issuer may at any time and in its sole discretion determine not
to have Book-Entry Notes represented by Global Securities and, in such event,
will issue Certificated Notes in exchange for all Global Securities representing
such Book-Entry Notes. In any such instance, an owner of a beneficial interest
in a Global Security will be entitled to physical delivery of Certificated Notes
represented by such Global Security equal in principal amount to such beneficial
interest and to have such Certificated Notes registered in its name. Unless
otherwise specified by such Issuer in a Pricing Supplement or otherwise,
Certificated Notes will be so issued in denominations of U.S. $1,000 and any
integral multiple in excess thereof (or the equivalent thereof in a Specified
Currency other than U.S. dollars).
IMPORTANT CURRENCY EXCHANGE INFORMATION
Purchasers are required to pay for Notes in the Specified Currency and
payments of principal of (and premium, if any) and interest, if any, on such
Notes will be made in the Specified Currency, unless otherwise provided in the
applicable Pricing Supplement. Currently, there are limited facilities in the
United States for conversion of U.S. dollars into foreign currencies and vice
versa and banks do not generally offer non-U.S. dollar checking or savings
account facilities in the United States. Accordingly, unless otherwise specified
in a Pricing Supplement or unless alternative arrangements are made between the
Company and a prospective purchaser of Notes, payment of principal of (and
premium, if any) and interest, if any, on Notes in a Specified Currency other
than U.S. dollars will be made to an account at a bank outside the United
States. However, if requested by a prospective purchaser of Notes denominated in
a Specified Currency other than U.S. dollars, the Agent soliciting the offer to
purchase will arrange for the conversion of U.S. dollars into such Specified
Currency to enable the purchaser to pay for such Notes. Such request must be
made on or before the fifth Business Day preceding the date of delivery of the
Notes, or by such other date as is determined by the Agent that presents such
offer to the Issuer of such Notes. Each such conversion will be made by the
relevant Agent on such terms and subject to such conditions, limitations and
charges as such Agent may from time to time establish in accordance with its
regular foreign exchange practice. All costs of exchange, if any, will be borne
by the purchasers of the Notes.
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UNITED STATES TAXATION
In the opinion of Ivins, Phillips & Barker, Chartered, special U.S. tax
counsel to the Issuers and the Guarantor, the following summary correctly
describes certain United States Federal income tax consequences resulting from
the purchase, ownership or disposition of Notes by an initial Holder (unless
otherwise indicated) subject to United States income taxation. It does not
purport to consider all the possible tax consequences of the purchase, ownership
or disposition of the Notes, and it is not intended to reflect the individual
tax position of any Holder. It deals only with Notes and currencies or composite
currencies other than U.S. dollars ("Foreign Currency") held as capital assets.
It does not deal with special tax situations, such as dealers in securities or
currencies, Notes (or Foreign Currency) held as a hedge against currency risks
or as part of a straddle with other investments or as part of a "synthetic
security" or other integrated investment (including a "conversion transaction")
comprised of a Note and one or more other investments, or (except for the
discussion of "Non-United States Persons" below) situations in which the
functional currency of the Holder is not the U.S. dollar. It is based upon the
United States Federal tax laws and regulations as now in effect and as currently
interpreted, and does not take into account possible changes in such tax laws or
such interpretations. It does not include any description of the tax laws of any
state or local governments, or of any foreign government, that may be applicable
to the Notes or Holders thereof. Persons considering the purchase of Notes
should consult their own tax advisers concerning the application of the United
States Federal tax laws to their particular situations as well as any
consequences arising under the laws of any other taxing jurisdiction. The
following discussion applies only to Notes under which all payments are
denominated in, or determined with reference to, a single currency, either a
single Foreign Currency or the U.S. dollar. If Notes are issued under which
payments are denominated in, or determined with reference to, more than one
currency, their tax treatment will be discussed in the applicable Pricing
Supplement relating to the issuance of such Notes.
The Tax Reform Act of 1986 made major changes in the United States Federal
tax laws that affect the treatment of currency gains and losses. Final
regulations and proposed regulations dealing with currency gains and losses were
issued by the Internal Revenue Service ("IRS") on March 17, 1992 (the "Foreign
Currency Regulations"). The following summary reflects the terms of the Foreign
Currency Regulations. Under the proposed Foreign Currency Regulations, however,
for taxable years ending on or after the date on which the proposed Foreign
Currency Regulations become final, certain Holders may elect to mark to market
foreign currency transactions based on the Holder's method of financial
accounting. Moreover, the Foreign Currency Regulations do not cover all issues,
and subsequent versions of such regulations (including the final form of the
proposed Foreign Currency Regulations) may adopt positions that would apply to
the Notes and that may be contrary to the positions discussed below.
UNITED STATES PERSONS
The following addresses the principal United States Federal income tax
consequences resulting from the ownership of a Note by a Holder who is a United
States person.
For purposes of the following discussion, the term "United States person"
means a citizen or resident of the United States, a corporation, partnership or
other entity created or organized under the laws of the United States or an
estate or trust the income of which is subject to United States Federal income
taxation regardless of its source, and "United States" means the United States
of America (including the States and the District of Columbia).
A Holder that is a nonresident alien individual as to the United States and
a bona fide resident of Puerto Rico, Guam, American Samoa or the Northern
Mariana Islands during the entire taxable year is also subject to the rules
described in this section as if such Holder were a United States person. Such a
Holder may also be subject to United States Federal withholding tax under the
rules described in the first paragraph under "Non-United States Persons" below.
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Payments of Interest
Except as described below under "Original Issue Discount", interest on a
Note (whether payable in a Foreign Currency or in U.S. dollars) will be taxable
to a Holder as ordinary income at the time it accrues or is received in
accordance with the Holder's method of accounting for tax purposes.
If payment of interest is denominated in or determined in reference to the
value of a Foreign Currency, then in the case of a cash method Holder who is not
required to accrue such interest prior to its receipt, the amount of interest
income is determined by translating the Foreign Currency into U.S. dollars at
the "spot rate" on the date of receipt. In the case of an accrual method Holder
or in the case of interest that must be accrued prior to receipt or payment
(such as original issue discount) the amount of interest income that is taken
into income for any interest accrual period is determined by translating the
Foreign Currency into U.S. dollars at the "average rate" for the interest
accrual period, or, with respect to an interest accrual period that spans two
taxable years, at the "average rate" for the partial period within the taxable
year. At the time the interest so accrued in a prior accrual period is received,
the Holder will realize exchange gain or loss equal to the difference, if any,
between the "spot rate" of the Foreign Currency received by the Holder with
respect to such accrual period on the date the interest is received and the
amount of interest income previously accrued for such period. A Holder may elect
to use, instead of such "average rate", the "spot rate" on the last day of the
accrual period (or, if the accrual period spans two of the Holder's taxable
years, the last day of the first taxable year). In addition, if the interest is
actually received within five Business Days of the end of such accrual period or
taxable year, an accrual method Holder making the election may instead use the
spot rate on the date the interest is received for purposes of translating
accrued interest income into U.S. dollars (in which case no exchange gain or
loss will be taken into account upon receipt). The election applies to all debt
instruments held by the Holder and cannot be changed without the consent of the
IRS.
The exchange gain or loss described in the immediately preceding paragraph
is ordinary and will generally not be considered additional interest income or
expense. The IRS has authority to issue regulations recharacterizing interest as
principal, or principal as interest, for obligations denominated in a
hyperinflationary currency. Under the proposed Foreign Currency Regulations,
which would become effective for transactions entered into after such
regulations are finalized, if a Holder acquires a Note denominated in a Foreign
Currency that is a hyperinflationary currency at the time of such acquisition,
the Holder would be required to realize exchange gain or loss on the Note each
year that the Holder holds the Note based (in general) on the change in exchange
rates between the Specified Currency and the U.S. dollar from the beginning to
the end of the year. Such exchange gain or loss would generally be treated,
respectively, as additional interest income or as an offset to interest income.
For purposes of this discussion, the "spot rate" generally means a rate
that reflects a fair market rate of exchange available to the public for
currency under a "spot contract" in a free market and involving representative
amounts. A "spot contract" is a contract to buy or sell a currency on or before
two Business Days following the date of the execution of the contract. If such a
spot rate cannot be demonstrated, the District Director of the IRS has the
authority to determine the spot rate. The "average rate" for an accrual period
(or partial period) is the simple average of the spot exchange rates for each
Business Day of such period, or other average exchange rate for the period
reasonably derived and consistently applied by the Holder.
Purchase, Sale and Retirement of Notes
A purchaser of a Note using Foreign Currency as the consideration for such
Note will generally be treated for Federal income tax purposes as though the
Foreign Currency used to purchase the Note were instead exchanged for U.S.
dollars, and the U.S. dollars received in such exchange were used to purchase
the Note. Thus, such a purchaser generally will be required to recognize
ordinary income or loss equal to the difference, if any, between the U.S. dollar
spot rate of the Foreign Currency used to purchase the Note on the date of
purchase, and the purchaser's U.S. dollar tax basis in the Foreign Currency.
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Upon the sale, exchange or retirement of a Note, a Holder will recognize
gain or loss equal to the difference between the amount realized (less any
accrued but unpaid qualified stated interest which will be taxable as such) and
the Holder's tax basis in the Note. If the amount received on the sale, exchange
or retirement is not in U.S. dollars, the amount realized will be based on the
spot rate of the Foreign Currency on the date of disposition. In the case of a
Note denominated in Foreign Currency, to the extent such recognized gain or loss
is attributable to changes in Foreign Currency exchange rates between the date
of acquisition and disposition of the Note, such gain or loss ("exchange gain or
loss") will be treated as ordinary income or loss (but will generally not be
treated as interest income or expense). However, exchange gain or loss is taken
into account only to the extent of total gain or loss realized on the
transaction. Except as provided below, any gain or loss in excess of such
exchange gain or loss will be capital gain or loss, and will be long-term
capital gain or loss if the Note had been held for more than one year.
If a Holder has a tax basis for a Note, other than a Note with a fixed
Maturity Date of one year or less from the date of issue, that is less than its
principal amount (or, in the case of an Original Issue Discount Note, less than
its original issue price plus original issue discount includable, without regard
to adjustments for acquisition premium discussed below under "Original Issue
Discount", in gross income by the prior Holder or Holders), the Note may be
considered to have "market discount". As a general matter, gain on a Note is
treated as ordinary income rather than capital gain to the extent of market
discount accrued while the Holder held the Note, although Holders may elect to
accrue market discount into income on a current basis. Such an election applies
to all debt instruments with market discount acquired by the electing Holder on
or after the first day of the first taxable year to which the election applies
and may not be revoked without the consent of the IRS. Market discount will be
treated as accruing on a ratable basis or, at the election of the Holder, based
on a constant interest method. Furthermore, unless a Holder elects to include
market discount into income on a current basis as described above, a Holder of a
Note having market discount may be required to defer the deduction of all or a
portion of the interest expense on any indebtedness incurred or maintained to
purchase or carry such Note until the Maturity Date of the Note or its earlier
disposition in a taxable transaction. In the case of a Note payable in a Foreign
Currency, (1) market discount is determined in units of the Foreign Currency,
(2) accrued market discount required to be taken into account on the Maturity or
earlier disposition of a
Note is translated into U.S. dollars at the spot rate on the Maturity or
disposition date (and no part is treated as exchange gain or loss), and (3)
accrued market discount currently includible in income by a Holder is translated
into U.S. dollars at the average exchange rate for the accrual period, and
exchange gain or loss is determined on the Maturity or disposition of the Note
in the manner described in "Payments of Interest" above, with respect to
computation of exchange gain or loss on the receipt of accrued interest.
If a Holder has a tax basis for a Note that is greater than its principal
amount, the Note may be considered to have "bond premium". The Holder may elect
to amortize such premium as offsets to interest income over the remaining life
of the Note under a constant interest method. (The treatment of Original Issue
Discount Notes purchased at a premium is discussed below. See "Original Issue
Discount".) Such an election generally applies to all Notes held by the Holder
at the beginning of the taxable year to which the election applies or thereafter
acquired by the Holder and is irrevocable without the consent of the IRS.
However, if such Note may be optionally redeemed after the Holder acquires it at
a price in excess of its principal amount, special rules would apply that could
result in a deferral of the amortization of some bond premium until later in the
term of the Note. In the case of a Note denominated in Foreign Currency, bond
premium is computed in units of Foreign Currency and amortizable bond premium
reduces interest income in units of the Foreign Currency. At the time amortized
bond premium offsets interest income, foreign currency exchange gain or loss
(taxable as ordinary income or loss, but not generally as interest income or
expense) is realized based on the difference between spot rates at that time and
at the time of the acquisition of the Note. With respect to a Holder that does
not elect to amortize bond premium, the amount of bond premium constitutes a
capital loss when the bond matures. In the case of a Note denominated in Foreign
Currency, foreign currency exchange gain or loss with respect to the premium is
realized based on the difference between the spot rates on the Maturity Date
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and at the time of the acquisition of the Note. In such case, the amount of
capital loss relating to the premium may be offset or eliminated by exchange
gain.
Receipt of Foreign Currency
The tax basis of Foreign Currency received by a Holder generally will equal
the U.S. dollar equivalent of such Foreign Currency at the spot rate on the date
it is received. Upon the subsequent exchange of such Foreign Currency for U.S.
dollars, another currency, or property, a Holder will generally recognize
exchange gain or loss equal to the difference between the Holder's tax basis for
the Foreign Currency and the U.S. dollars received (or, if another currency is
received, the U.S. dollar value of the other currency at the spot rate on the
date of the exchange) or, if property is received, the U.S. dollar value of the
Foreign Currency based on the spot rate on the date of purchase. Such gain or
loss will be ordinary in character.
Indexed Notes
The specific treatment of any Indexed Notes issued will be discussed in
applicable Pricing Supple-
ment relating to the issuance of such Notes and would generally be subject to
different rules from those set forth in this discussion.
Original Issue Discount
The following summary is a general discussion of the United States Federal
income tax consequences to Holders who are United States persons of Notes issued
with original issue discount ("Original Discount Notes"). It is based in part
upon income tax regulations (the "OID Regulations") that were published in the
Federal Register on April 4, 1994. Additionally, the summary includes a
discussion of final regulations published in the Federal Register on June 14,
1996, relating primarily to contingent payment debt instruments with original
issue discount (the "Contingent Payment Debt Regulations"). The discussion
assumes that the Notes will not qualify as "applicable high-yield discount
obligations" under the Code.
For United States Federal income tax purposes, original issue discount is
the excess of the stated redemption price at maturity of an Original Issue
Discount Note over its "issue price" (defined as the first price at which a
substantial amount of the Original Issue Discount Notes have been sold) unless,
in most circumstances, such excess is less than 0.25% of the Original Issue
Discount Note's stated redemption price at maturity multiplied by the number of
complete years to its maturity. The stated redemption price at maturity of an
Original Issue Discount Note is the total of all payments to be made under the
Original Issue Discount Note other than "qualified stated interest." The term
"qualified stated interest" means, in general, stated interest that is
unconditionally payable in cash or property at least annually at a single fixed
rate (or at certain floating rates) that appropriately takes into account the
length of the interval between stated interest payments.
In certain cases, Notes that bear stated interest and are issued at par may
be deemed to bear original issue discount for Federal income tax purposes, with
the result that the inclusion of interest in income for Federal income tax
purposes may vary from the actual cash payments of interest made on such Notes,
generally accelerating income for cash method taxpayers. Under the OID
Regulations, a Note may be an Original Issue Discount Note where, among other
things, (i) a Floating Rate Note provides for a maximum interest rate or a
minimum interest rate that is reasonably expected as of the issue date to cause
the yield on the debt instrument to be significantly less, in the case of a
maximum rate, or more, in the case of a minimum rate, than the expected yield
determined without the maximum or minimum rate, as the case may be; (ii) a
Floating Rate Note provides for a significant front-loading or back-loading of
interest; or (iii) a Note bears interest at a floating rate in combination with
one or more other floating or fixed rates. Notice will be given in the
applicable Pricing Supplement if the Company determines that a particular Note
will be an Original Issue Discount Note. Unless specified in the applicable
Pricing Supplement, Floating Rate Notes will not be Original Issue Discount
Notes.
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Persons holding Original Issue Discount Notes having maturities in excess
of one year are required to include original issue discount in income before the
receipt of cash attributable to such income. The amount of original issue
discount includible in income by the initial Holder of such Original Issue
Discount Notes and, subject to an adjustment, by any subsequent Holder, is the
sum of the daily portions of the original issue discount with respect to the
Original Issue Discount Note for each day during the taxable year in which such
Holder held the Original Issue Discount Note ("accrued original issue
discount"). The daily portion of the original issue discount on any Original
Issue Discount Note is determined by allocating to each day in any "accrual
period" a ratable portion of the original issue discount allocable to that
accrual period. The term "accrual period" generally means the period between
interest payment dates (or shorter period from the date of issue to the first
interest payment date and from the last interest payment date prior to maturity
to the date of maturity).
For any accrual period, the original issue discount allocable to the
accrual period is an amount equal to the excess, if any, of (a) the product of
the Original Issue Discount Note's adjusted issue price at the beginning of such
accrual period and its yield to maturity (determined on the basis of compounding
at the close of each accrual period and adjusted for the length of the accrual
period) over (b) the sum of the qualified stated interest, if any, allocable to
such accrual period. The "adjusted issue price" of an Original Issue Discount
Note at the beginning of the first accrual period is the issue price and at the
beginning of any accrual period thereafter is (x) the sum of the issue price of
such Original Issue Discount Note, the accrued original issue discount for each
prior accrual period (determined without regard to the amortization of any
acquisition premium, as discussed below, or bond premium, as discussed above),
and the amount of any qualified stated interest on the Note that has accrued
prior to the beginning of the accrual period but is not payable until a later
date, less (y) any prior payments on the Original Issue Discount Note that were
not qualified stated interest. If a payment (other than a payment of qualified
stated interest) is made on the first day of an accrual period, then the
adjusted issue price at the beginning of such accrual period is reduced by the
amount of the payment.
Under the above rules, persons holding Original Issue Discount Notes will
be required to include in income increasingly greater amounts of original issue
discount in successive accrual periods, assuming that no payments other than
qualified stated interest are made prior to the maturity of the Note.
If an Issuer has an option to redeem a Note, or the Holder has an option to
cause a Note to be repurchased, prior to the Note's stated maturity, such option
will be presumed to be exercised if, by utilizing any date on which such Note
may be redeemed or repurchased as the maturity date and the amount payable on
such date in accordance with the terms of such Note (the "redemption price") as
the stated redemption price at maturity, the yield on the Note would be (i) in
the case of an option of an Issuer, lower than its yield to stated maturity, or
(ii) in the case of an option of the Holder, higher than its yield to stated
maturity. If such option is not in fact exercised when presumed to be exercised,
the Note would be treated solely for original issue discount purposes as if it
were redeemed or repurchased, and a new Note were issued on the presumed
exercise date for an amount equal to the Note's adjusted issue price on that
date.
Original issue discount on an Original Issue Discount Note denominated in,
or under which all payments are determined with reference to, a single Foreign
Currency will be determined for any accrual period in that Foreign Currency and
then translated into U.S. dollars in the same manner as other interest income
accrued by an accrual method Holder before receipt, as described above under
"Payments of Interest". Likewise, as described therein, exchange gain or loss
will be recognized when the original issue discount is paid. For this purpose,
all payments (other than qualified stated interest) on a Note will first be
viewed as payments of previously accrued original issue discount (to the extent
thereof), with payments considered made for the earliest accrual periods first.
The Contingent Payment Debt Regulations address, among other things, the
accrual of original issue discount on, and the character of gain recognized on
the sale, exchange, or retirement of debt instruments providing for contingent
payments. Prospective Holders of Notes with contingent payments should refer to
the discussion regarding taxation in the applicable Pricing Supplement.
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Different rules apply to Original Issue Discount Notes having maturities of
not more than one year ("Short-Term Discount Notes"). A Holder of a Short-Term
Discount Note who uses the cash method of tax accounting will generally not be
required to include original issue discount in income on a current basis (but
may be required to defer a deduction for a portion or all of the interest paid
or accrued on any indebtedness incurred to purchase or carry such Short-Term
Discount Note). Rather, such a Holder will be required to treat any gain
realized on a sale, exchange or retirement of the Short-Term Discount Note as
ordinary income to the extent such gain does not exceed the original issue
discount accrued with respect to the Short-Term Discount Note during the period
the Holder held the Short-Term Discount Note. Holders using the accrual method
of tax accounting, and certain cash method Holders (including banks, securities
dealers and regulated investment companies) will generally be required to
include original issue discount on the Short-Term Discount Note in income on a
current basis. Notwithstanding the foregoing, a cash method Holder of a
Short-Term Discount Note may elect to accrue original issue discount into income
on a current basis (in which case the limitation on the deductibility of
interest described above will not apply). Original issue discount will be
treated as accruing for these purposes on a ratable basis or, at the election of
the Holder, on a constant interest basis. Furthermore, any Holder (whether cash
or accrual method) of a Short-Term Discount Note can elect to accrue the
"acquisition discount", if any, with respect to the Short-Term Discount Note on
a current basis in lieu of original issue discount. Acquisition discount is the
excess of the stated redemption price at maturity of the Short-Term Discount
Note over the Holder's tax basis in the Note at the time of acquisition.
Acquisition discount will be treated as accruing on a ratable basis or, at the
election of the Holder, using a constant interest method. The market discount
rules do not apply with respect to Short-Term Discount Notes.
For purposes of determining the amount of original issue discount subject
to these rules, the OID Regulations provide that no interest payments on Notes
with maturities of one year or less are qualified stated interest, but instead
such interest payments are included in such Note's stated redemption price at
maturity.
In the event that a person purchases an Original Issue Discount Note
(including a Short-Term Discount Note) at an acquisition premium, i.e., at a
price in excess of the issue price plus the original issue discount accrued
prior to acquisition and minus any payments (other than payments of qualified
stated interest) made with respect to such Note prior to acquisition (such
amount, the Note's "revised issue price"), the amount includible in income in
each taxable year as original issue discount will be reduced by that portion of
the acquisition premium properly allocable to such year or, alternatively, a
Holder may elect to treat its purchase price as the Note's issue price.
The market discount and bond premium rules discussed above under "Purchase,
Sale and Retirement of Notes" may apply to an Original Issue Discount Note
purchased at a price that is less than such Note's revised issue price (in the
case of market discount) or that is greater than such Note's remaining stated
redemption price at maturity (in the case of bond premium), respectively. In
such case, the amount of market discount will generally equal the excess of the
Original Issue Discount Note's revised issue price over the Holder's purchase
price for the Note, and the amount of bond premium will equal the excess of the
Holder's purchase price over the Original Issue Discount Note's remaining stated
redemption price at maturity. A Holder of an Original Issue Discount Note with
bond premium will not be subject to the original issue discount rules described
above.
A Holder's tax basis of an Original Issue Discount Note generally will be
the Holder's cost increased by any original issue discount included in income
(and market discount, if any, if the Holder has elected to include accrued
market discount in income on an annual basis) and decreased by the amount of any
payment (other than qualified stated interest) received with respect to the
Original Issue Discount Note. Gain or loss on the sale, exchange or redemption
of an Original Issue Discount Note generally will be long-term capital gain or
loss if the Original Issue Discount Note has been held for more than a year
except to the extent that gain represents market discount not previously
included in the Holder's income.
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The original issue discount rules will not be applied to treat Notes as
having original issue discount solely by virtue of the contingent U.S. dollar
values of payments on Notes denominated in a Foreign Currency.
A Holder may elect to treat all interest that accrues on a Note as original
issue discount applying the constant yield method described above to accrue such
interest, with the modifications described below. For purposes of this election,
interest includes stated interest, original issue discount, de minimis original
issue discount, market discount, acquisition discount, de minimis market
discount and unstated interest, as adjusted by any amortizable bond premium
(described above) or acquisition premium.
In applying the constant yield method to a Note with respect to which this
election has been made, the issue price of the Note will equal the electing
Holder's adjusted basis in the Note immediately after its acquisition, the issue
date of the Note will be the date of its acquisition by the electing Holder, and
no payments on the Note will be treated as payments of qualified stated
interest. This election will generally apply only to the Note with respect to
which it is made and may not be revoked without the consent of the IRS. If this
election is made with respect to a Note with amortizable bond premium, then the
electing Holder will be deemed to have elected to apply amortizable bond premium
against interest with respect to all debt instruments with amortizable bond
premium (other than debt instruments the interest on which is excludable from
gross income) held by such electing Holder as of the beginning of the taxable
year in which the Note with respect to which the election is made is acquired or
thereafter acquired. The deemed election with respect to amortizable bond
premium may not be revoked without the consent of the IRS.
If the election described above to apply the constant yield method to all
interest on a Note is made with respect to a Note that has market discount, as
described above, then the electing Holder will be treated as having made the
election discussed above under "Purchase, Sale, and Retirement of Notes" to
include market discount in income currently over the life of all debt
instruments held or thereafter acquired by such Holder.
Subsequent Interest Periods and Extensions of Maturity
If a reset of the interest rate, Spread and/or Spread Multiplier of a Note
(either alone or in conjunction with each other) by any Issuer or extension of
the maturity of a Note is treated as an exchange of such Note for a new Note,
then a United States person who is a Holder of such Note may recognize taxable
gain or loss (subject to characterization as capital gain or loss or ordinary
income or loss depending on the effect of the original issue discount, foreign
currency, or other rules described herein) equal to the difference between the
fair market value of such Note and the Holder's adjusted tax basis in such Note
at the time of the reset or extension. In such case, the Holder will have a tax
basis in a new Note equal to such fair market value. The tax consequences
described above with respect to the timing and character of income, gain or loss
would apply to the holding of the new Note. If, on the other hand, the interest
reset or maturity extension is not treated as an exchange, then a United States
person who is a Holder will not recognize gain or loss upon the reset or
extension, but the reset or extension may affect the timing, character, and
amount of income, gain or loss with respect to the subsequent holding period of
the Note. On June 26, 1996, final regulations were published in the Federal
Register which govern the resolution of the issue or whether an interest reset
or maturity extension would or would not result in an exchange.
NON-UNITED STATES PERSONS
Under the United States Federal tax laws as in effect on the date of this
Prospectus Supplement and subject to the discussion of backup withholding below,
payments of principal (and premium, if any) and interest, including original
issue discount, by any Issuer, the Guarantor or any agent of such Issuer or the
Guarantor (acting in its capacity as such) to any Holder of a Note who is not a
United States person will not be subject to United States Federal withholding
tax, provided, in the case of interest, including original issue discount, that
(i) such Holder does not actually or constructively own 10% or more of the
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total combined voting power of all classes of stock of such Issuer entitled to
vote, (ii) such Holder is not a controlled foreign corporation for United States
tax purposes that is related to such Issuer through stock ownership, (iii) the
Holder is not receiving interest ineligible for exemption from withholding by
reason of the application of Section 881(c)(3)(A) of the Code, (iv) the Holder
is not a foreign private foundation and (v) either (A) the beneficial owner of
the Note certifies to the last United States person (the "Withholding Agent") in
the chain of payment, under penalties of perjury, that he is a non-United States
person and provides his name and address, or (B) a securities clearing
organization, bank or other financial institution that holds customers'
securities in the ordinary course of its trade or business (a "financial
institution") and holds such Note certifies to the Withholding Agent, under
penalties of perjury, that such statement has been received from the beneficial
owner by it or by another financial institution and furnishes the payor with a
copy thereof. Applicable regulations contain certain other requirements
regarding the timing, form, and maintenance by the Withholding Agent of the
certification described in the preceding sentence.
Notes issued by both of the Subsidiary Issuers will be considered debt of
the respective Subsidiary Issuer. Subject to the discussion below under "Backup
Withholding and Information Reporting", no United States withholding tax should
apply to payments of principal or interest on such Notes by either the
respective Subsidiary Issuer or the Guarantor.
Payments of certain types of contingent interest to a person who is not a
United States person may be subject to United States withholding tax equal to
30% of each such payment (or such lower amount as provided by treaty). The
applicable Pricing Supplement will state whether any Notes having contingent
payments will be subject to any U.S. withholding taxes.
If a Holder of a Note who is not a United States person is engaged in a
trade or business in the United States and interest, including original issue
discount, on the Note is effectively connected with the conduct of such trade or
business, such Holder, although exempt from the withholding tax discussed in the
preceding paragraph, may be subject to United States Federal income tax on such
interest, and original issue discount, in the same manner as if it were a United
States person. In addition, if such a Holder is a foreign corporation, it may be
subject to a branch profits tax equal to 30% of its effectively connected
earnings and profits for the taxable year, subject to certain adjustments. For
purposes of the branch profits tax, interest (including original issue discount)
on a Note will be included in the earnings and profits of such Holder if such
interest (or original issue discount) is effectively connected with the conduct
by such Holder of a trade or business in the United States. In lieu of the
certificate described in the second preceding paragraph, such a Holder must
provide the payor with a properly executed Internal Revenue Service Form 4224 to
claim an exemption from United States Federal withholding tax. However, such a
Holder of a Note may still be required to provide the certification described in
the second preceding paragraph in order to obtain an exemption from "backup"
withholding, discussed below.
Any capital gain or market discount realized upon retirement or disposition
of a Note by a Holder who is not a United States person will not be subject to
United States Federal income or withholding taxes if (i) such gain is not
effectively connected with a United States trade or business of the Holder, and
(ii) in the case of an individual, such Holder is either (A) not present in the
United States for 183 days or more in the taxable year of the retirement or
disposition or (B) such individual does not have a "tax home" (as defined in the
Code) in the United States and the gain is not attributable to an office or
other fixed place of business maintained by such individual in the United
States.
Notes held by an individual who is neither a citizen nor a resident of the
United States for United States Federal income tax purposes at the time of such
individual's death will not be subject to United States Federal estate tax
provided that the income from such Notes was not or would not have been
effectively connected with a United States trade or business of such individual
and that such individual qualified for the exemption from United States Federal
withholding tax (without regard to the certification requirements) that is
described above.
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BACKUP WITHHOLDING AND INFORMATION REPORTING
For each calendar year in which the Notes are outstanding, the payor of
interest (including original issue discount, if any), principal, premium, or the
proceeds of disposition to a Holder is required to provide the IRS with certain
information, including the Holder's name, address and taxpayer identification
number ("TIN") (either the Holder's Social Security number or its employer
identification number, as the case may be), the aggregate amount of principal,
interest (including original issue discount, if any), premium, or the proceeds
of disposition paid to that Holder during the calendar year and the amount of
tax withheld, if any. This obligation, however, does not apply with respect to
certain United States persons who are Holders, including corporations,
tax-exempt organizations, qualified pension and profit sharing trusts and
individual retirement accounts, but such entities may be required to establish
their status as such.
A "backup withholding" tax equal to 31% of each payment on the Notes will
apply to a United States person who is a Holder subject to the reporting
requirements described above if such Holder (i) fails to furnish his TIN or (ii)
under certain circumstances, fails to certify, under penalty of perjury, that he
has both furnished a correct TIN and not been notified by the IRS that he is
subject to backup withholding for failure to report interest and dividend
payments. Backup withholding will also apply if the payor is notified by the IRS
that the payee has failed to report properly a correct TIN or interest and
dividends earned by the payee. This backup withholding tax is not an additional
tax and may be credited against the United States person's United States Federal
income tax liability.
Under current Treasury regulations, backup withholding and information
reporting will not apply to payments made by any Issuer, the Guarantor or any
agent of such Issuer or the Guarantor (in its capacity as such) to a Holder of a
Note who is not a United States person if the Holder has provided required
certification that it is not a United States person as set forth in clause
(v)(A) in the first paragraph under "Non-United States Persons", or has
otherwise established an exemption (provided that none of such Issuer, the
Guarantor and such agent has actual knowledge that the Holder is a United States
person or that the conditions of any exemption are not in fact satisfied).
If such principal or interest is collected outside the United States by the
non-United States office of a foreign custodian, foreign nominee or other
foreign agent of the beneficial owner of a Note and is paid by such office
outside the United States to such owner, or if the non-United States office of a
foreign "broker" (as defined in the Treasury regulations) pays the proceeds of
the sale or exchange of a Note outside the United States to the seller thereof,
backup withholding and information reporting will not apply to such payment
(provided, except in the case of interest on a Note of a Subsidiary Issuer, that
such nominee, custodian, agent or broker derives less than 50% of its gross
income for certain specified periods from the conduct of a trade or business in
the United States and is not a controlled foreign corporation for United States
tax purposes). Except in the case of interest on a Note of a Subsidiary Issuer,
principal and interest so paid by the non-United States office of other
custodians, nominees or agents, or the payment by the foreign office of other
brokers of the proceeds of the sale or exchange of a Note will not be subject to
backup withholding, but will be subject to information reporting unless the
custodian, nominee, agent or broker has documentary evidence in its records that
the beneficial owner or seller is not or was not, as the case may be, a United
States person who is a Holder and certain conditions are met or the beneficial
owner or seller otherwise establishes an exemption. (Under current regulations,
interest on a Note of a Subsidiary Issuer paid outside the United States is not
subject to information reporting or backup withholding under any circumstances.
Under regulations proposed by the United States Treasury Department on April 15,
1996, which are not yet effective, the information reporting requirements with
respect to such payments will be conformed to the existing rules applicable to
interest on a Note of the Company paid outside the United States as discussed
above.) Principal and interest on any Note paid by the United States office of a
custodian, nominee or agent, or the payment by the United States office of a
broker of the proceeds of a sale or exchange of a Note is subject to both backup
withholding and information reporting unless the beneficial owner or seller
certifies its non-United States person status under penalties of perjury or
otherwise establishes an exemption.
S-34
<PAGE> 36
On February 29, 1988, September 27, 1990 and April 15, 1996, the United
States Treasury Department issued proposed regulations concerning the
application of information reporting requirements and the backup withholding tax
to non-United States persons. If adopted in their current form, these proposed
regulations would not, except as discussed in the immediately preceding
paragraph, materially affect the application of the rules discussed above. It is
impossible to predict whether or in what form the proposed regulations will
become final and what the scope or effective date of any such final regulations
might be.
PLAN OF DISTRIBUTION
The Notes are being offered on a continuous basis by each Issuer through
the Agents, each of which has agreed to use its reasonable best efforts to
solicit purchases of the Notes. Unless otherwise specified in the applicable
Pricing Supplement, with respect to Notes with Maturity Dates of 30 years or
less from the date of issue, the Issuer thereof will pay each Agent a commission
(or grant a discount) ranging from .125% to .750% of the principal amount of
each Note, depending upon the Maturity Date, sold through such Agent. With
respect to Notes with a Maturity Date that is longer than 30 years from the date
of issue sold through any Agent, the rate of commission (or discount) will be
negotiated at the time of sale and will be specified in the applicable Pricing
Supplement.
The Notes also may be sold by any of the Issuers to any Agent, acting as
principal, at a discount for resale to one or more purchasers at varying prices
related to prevailing market prices at the time of resale, or, if set forth in
the applicable Pricing Supplement, the Agent may also resell such Notes at a
fixed public offering price, as determined by the Agent. In connection with any
resale of Notes purchased, an Agent may use a selling or dealer group and may
reallow any portion of the discount or commission payable pursuant thereto to
dealers or purchasers. After any initial public offering of Notes to be resold
to investors and other purchasers, the public offering price (in the case of
Notes to be resold at a fixed public offering price), the commission and
discount may be changed. Unless otherwise specified in the applicable Pricing
Supplement, any Note purchased by an Agent as principal will be purchased at
100% of the principal amount thereof less a percentage equal to the commission
(or discount) applicable to an agency sale of a Note of identical Maturity Date.
In addition, any of the Issuers may appoint additional agents for the purpose of
soliciting offers to purchase the Notes. Each such additional agent will solicit
purchasers of the Notes on a reasonable best efforts basis. Any of the Issuers
may also sell the Notes directly to, and may accept offers to purchase the Notes
from, investors on its own behalf in those jurisdictions where it is authorized
to do so. In the case of sales made directly by an Issuer, no commission will be
payable and no discount will be granted. The Issuers have agreed to reimburse
the Agents for certain of the Agents' expenses, and the Issuers contemplate that
they will enter into similar arrangements with any additional agents that they
subsequently appoint.
Each Issuer will have the sole right to accept offers to purchase Notes to
be issued by it and may reject any proposed purchase of Notes to be issued by it
in whole or in part. Each Agent (and each additional agent subsequently
appointed) will have the right, in its discretion reasonably exercised, to
reject in whole or in part any offer to purchase Notes received by such Agent.
Each Agent, as an agent or principal, and each additional agent
subsequently appointed by an Issuer, may be deemed to be an "underwriter" within
the meaning of the Securities Act of 1933. Each Issuer has agreed to indemnify
each Agent (and will agree to indemnify each additional agent that it
subsequently appoints) against certain liabilities, including liabilities under
the Securities Act of 1933, or to contribute to payments each Agent (or
additional agent) may be required to make in respect thereof.
No Note will have an established trading market when issued. The Notes will
not be listed on any securities exchange. Each Agent and each subsequently
appointed agent may make a market in the Notes, but such Agent or agent is not
obligated to do so and may discontinue any marketmaking at any time without
notice. There can be no assurance of a secondary market for any Notes or that
the Notes will be sold.
In connection with the offering, the Agents may purchase and sell the Notes
in the open market. These transactions may include overallotment and stabilizing
transactions and purchases to cover short positions created by the Agents in
connection with the offering. The Agents also may impose a penalty
S-35
<PAGE> 37
bid, whereby selling concessions allowed to broker-dealers in respect of the
securities sold in the offering may be reclaimed by the Agents if such Notes are
repurchased by the Agents in stabilizing or covering transactions. These
activities may stabilize, maintain or otherwise affect the market price of the
Notes, which may be higher than the price that might otherwise prevail in the
open market, and these activities, if commenced, may be discontinued at any
time. These transactions may be effected in the over-the-counter market or
otherwise.
In the ordinary course of their respective businesses, Goldman, Sachs & Co.
and affiliates, Lehman Brothers, Lehman Brothers Inc. and affiliates, Merrill
Lynch, Pierce, Fenner & Smith Incorporated and affiliates, Morgan Stanley & Co.
Incorporated and affiliates, and Salomon Brothers Inc and affiliates have
engaged, and may in the future engage, in investment banking transactions with
each of the Issuers and its affiliates. In the ordinary course of its business,
J.P. Morgan Securities Inc. and affiliates have engaged, and may in the future
engage, in investment banking and commercial banking transactions with each of
the Issuers and its affiliates.
S-36
<PAGE> 38
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION DATED AUGUST 25, 1997
PROSPECTUS
XEROX CORPORATION
XEROX OVERSEAS HOLDINGS PLC
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY XEROX CORPORATION
RANK XEROX CAPITAL (EUROPE) PLC
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY XEROX CORPORATION
DEBT SECURITIES
Any of Xerox Corporation, a New York corporation ("Xerox" or the
"Company"), Xerox Overseas Holdings plc ("Xerox Overseas") and Rank Xerox
Capital (Europe) plc ("Xerox Capital") may from time to time issue debt
securities (the "Debt Securities") from which the applicable issuer will receive
proceeds of up to an aggregate of $2,250,000,000 (or the equivalent thereof in
one or more foreign denominated currencies or units consisting of multiple
currencies, including European Currency Units ("ECU")) and which will be offered
on terms to be determined at the time of sale. Xerox Overseas is a wholly-owned
subsidiary of Xerox, and Xerox Capital is a wholly-owned subsidiary of Rank
Xerox Limited, which in turn is a wholly-owned subsidiary of Xerox. Both Xerox
Overseas and Xerox Capital are public limited companies organized under the laws
of England and Wales. Xerox Overseas and Xerox Capital are collectively referred
to herein as the "Subsidiary Issuers" and, Xerox, in its capacity as an issuer,
and the Subsidiary Issuers are collectively referred to herein as the "Issuers".
The Debt Securities may be issued in one or more series with the same or various
maturities at par or with an original issue discount and may be issued as
individual securities in registered form without coupons or as one or more
global securities in registered form (each a "Global Security"). The purchase
price for the principal of and any premium and any interest on the Debt
Securities may be payable in U.S. dollars or in one or more foreign denominated
currencies or currency units.
The specific title, aggregate principal amount, designated currency or
currency units, offering price, maturity, rate (which may be fixed or variable)
or method of calculating interest and time of any payment of interest (if any),
the currency or currency units in which payments of Debt Securities may be made,
any right on the part of the holders of Debt Securities to require the
repurchase thereof by the applicable Issuer, any redemption, prepayment, sinking
fund and other terms and any securities exchange listing of Debt Securities (the
"Offered Debt Securities") in respect of which this Prospectus is being
delivered will be set forth in a supplement to this Prospectus (the "Prospectus
Supplement") together with the terms of the offering. The Prospectus Supplement
will also contain information where applicable about material United States
Federal income tax considerations relating to the Debt Securities covered by
such Prospectus Supplement.
The Debt Securities offered by the Company are unsecured and will rank pari
passu with all other unsecured and unsubordinated debt of the Company. The Debt
Securities offered by the Subsidiary Issuers will be irrevocably and
unconditionally guaranteed (the "Guarantees") by the Company (in such capacity,
the "Guarantor"), and the Guarantees will rank pari passu with all other
unsecured and unsubordinated debt of the Company.
The Issuers may sell the Offered Debt Securities in any one or more of the
following ways: (1) directly to investors, (2) to investors through agents, (3)
to broker-dealers as principals, (4) through underwriting syndicates led by one
or more managing underwriters as the applicable Issuer may select from time to
time, or (5) through one or more underwriters acting alone. If any underwriters,
agents or dealers are involved in the sale of the Offered Debt Securities, their
names and any applicable fee, commission or discount arrangements with them will
be set forth in the Prospectus Supplement. See "Plan of Distribution".
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF OFFERED DEBT
SECURITIES UNLESS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
------------------------
The date of this Prospectus is August , 1997.
<PAGE> 39
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by the Company can be inspected and
copied at the public reference facilities of the Commission at 450 Fifth Street
N.W. (Room 1024), Judiciary Plaza, Washington, D.C. 20549, as well as at the
Regional Offices of the Commission located at Northwestern Atrium Center, 500
West Madison Street (Suite 1400), Chicago, Illinois 60661; and Seven World Trade
Center (13th Floor), New York, New York 10048. Copies of such material can be
obtained 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 that contains reports, proxy statements and other
information regarding registrants that file electronically with the Commission
at http://www.sec.gov. Such reports, proxy statements and other information
concerning the Company also may be inspected at the offices of the New York
Stock Exchange, Inc., 20 Broad Street, New York, New York 10005, and the Chicago
Stock Exchange, One Financial Plaza, 120 South LaSalle Street, Chicago, Illinois
60603. This Prospectus does not contain all the information set forth in the
Registration Statement and Exhibits thereto which the Issuers have filed with
the Commission under the Securities Act of 1933 and to which reference is hereby
made.
The Company, on behalf of the Subsidiary Issuers, and each Subsidiary
Issuer intend to make application to the Commission for an order of the
Commission exempting each Subsidiary Issuer from the reporting requirements of
the Exchange Act. If such order is granted, or the Commission otherwise grants
relief to the Subsidiary Issuers from such reporting requirements, neither of
the Subsidiary Issuers will be subject to the reporting requirements of the
Exchange Act. Subject to Commission relief, the Company intends to include in
its audited consolidated financial statements separate financial information
with respect to Xerox Overseas, but does not intend to include in its
consolidated financial statements any separate financial information with
respect to Xerox Capital. In addition, in view of the Guarantees of the Debt
Securities of the Subsidiary Issuers given by the Company, neither of the
Subsidiary Issuers intends to furnish to holders of its Debt Securities separate
financial statements or other reports.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
There are incorporated herein by reference the following documents filed
with the Commission (File No. 1-4471) by the Company pursuant to the Exchange
Act:
(1) Annual Report on Form 10-K for the fiscal year ended December 31,
1996, as amended;
(2) Quarterly Reports on Form 10-Q for the quarterly periods ended
March 31, 1997, as amended, and June 30, 1997; and
(3) Current Reports on Form 8-K dated January 22, 1997, April 7, 1997,
May 19, 1997, June 6, 1997 and June 30, 1997.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14
(other than the information required by paragraphs (k) and (l) of sec.229.402 of
Regulation S-K) or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offerings of the Debt Securities
offered hereby shall be deemed to be incorporated by reference into this
Prospectus. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, including any beneficial owner, upon written or oral
request of such person, a copy of any or all of the foregoing documents
incorporated herein by reference (other than exhibits to such documents, unless
such exhibits are specifically incorporated by reference in such documents).
Requests should be directed to The Customer Service Unit of State Street Bank
and Trust Company, Two International Place, Boston, Massachusetts 02110,
telephone: (617) 664-5750.
2
<PAGE> 40
THE COMPANY
Xerox is a New York corporation with its principal executive offices
located at 800 Long Ridge Road, Stamford, Connecticut 06904, telephone (203)
968-3000.
Xerox is The Document Company and a leader in the global document market,
providing document solutions that enhance productivity. References herein to
"Xerox" refer to Xerox and consolidated subsidiaries unless the context
specifically requires otherwise. Xerox distributes its products in the Western
Hemisphere through divisions and wholly-owned subsidiaries. In Europe, Africa,
the Middle East and parts of Asia, including Hong Kong, India and China, Xerox
distributes through Rank Xerox Limited and related companies ("Xerox Limited").
In Japan and other areas of the Pacific Rim, Australia and New Zealand, document
processing products are distributed by Fuji Xerox Co. Ltd., an unconsolidated
joint venture, which is equally owned by Fuji Photo Film Company, Ltd. of Japan
and Xerox Limited.
In June 1997, Xerox acquired the remaining 20 percent of Xerox Limited from
The Rank Group Plc ("Rank Group") in a transaction valued at 940 million pounds
sterling, or approximately $1.5 billion. As a result of this transaction, Xerox
now owns 100 percent of Xerox Limited. The transaction was funded entirely by
debt consisting of 500 million pounds sterling of third party debt and 440
million pounds sterling of notes payable issued to Rank Group, which will be
paid in deferred installments, half within one year and the other half at the
end of two years. An additional payment of up to 60 million pounds sterling
would be made in 2000 based upon achievement of certain Xerox Limited earnings
growth targets by 1999.
Beginning in 1995, the results of Xerox' Insurance operations were
accounted for as discontinued operations. The Document Processing business is
now the only component of continuing operations.
Xerox' Document Processing activities encompass developing, manufacturing,
marketing, servicing and financing a complete range of document processing
products and services designed to make offices around the world more productive.
Xerox believes that documents will play a central role in business, government,
education and other organizations far into the future and that efficient
processing of documents offers significant opportunities for productivity
improvements. The financing of Xerox equipment is generally carried out by Xerox
Credit Corporation ("XCC") in the United States and internationally by foreign
financing subsidiaries and divisions in most countries that Xerox operates.
Document Processing operations employed 86,700 people worldwide at year-end
1996.
XEROX OVERSEAS
Xerox Overseas was organized as a private limited company on November 7,
1996 under the name of 2032nd Single Member Shelf Investment Company Limited
pursuant to the Companies Act 1985 of England and Wales. Its name was
subsequently changed on June 10, 1997 to Xerox Overseas Holdings Limited, and on
June 13, 1997 it was re-registered as a public company under the name Xerox
Overseas Holdings Public Limited Company. Its principal executive offices are
located at Parkway, Marlow, Buckinghamshire 5L7 1YL, England, and the telephone
number at such address is 44-1-628-89-0000. Xerox Overseas is a wholly-owned
subsidiary of the Company. Xerox Overseas is the majority shareholder of Xerox
Limited and also owns 100 percent of those companies of Rank Group which were
acquired in June 1997. See "The Company". Xerox Overseas may undertake
borrowings on behalf of the Company and certain of its subsidiaries and advance
the proceeds of such borrowings to the Company and certain of its subsidiaries.
ENFORCEABILITY OF CERTAIN CIVIL LIABILITIES
Some of the directors and executive officers of Xerox Overseas (and certain
of the experts named herein) are citizens or residents of jurisdictions other
than the United States. All or a substantial portion of the assets of such
directors, executive officers and experts residing outside of the United States
and all of the assets of Xerox Overseas are or may be located outside the United
States. As a result, it may not be possible to effect service of process on such
directors, executive officers or experts or Xerox Overseas in the United States
or to enforce, collect or realize, in United States courts, upon judgments that
may be
3
<PAGE> 41
obtained against such persons in United States courts and predicated upon civil
liability under United States securities laws. The Company and Xerox Overseas
have been advised by Lovell White Durrant, special English counsel to the
Company and Xerox Overseas, that there is doubt as to the enforceability in
England and Wales, in original actions or actions for the enforcement of
judgments of United States courts, of civil liabilities predicated solely on
United States Federal securities laws. The indenture pursuant to which the Debt
Securities will be issued will provide that Xerox Overseas will appoint the
Company as its agent for service of process in any suit, action or proceeding
with respect to such indenture brought under Federal or state securities laws in
any Federal or state court located in The City of New York, and will submit to
such jurisdiction.
XEROX CAPITAL
Xerox Capital was organized as a public limited company on June 20, 1995
under the name of Timedfuture Plc pursuant to the Companies Act 1985 of England
and Wales. Its name was subsequently changed on November 28, 1995 to Rank Xerox
Capital (Europe) plc and its principal executive offices are located at Parkway,
Marlow, Buckinghamshire, SL7 1YL, England, and the telephone number at such
address is 44-1-628-89-0000. Xerox Capital is a wholly-owned subsidiary of Rank
Xerox Limited, a private limited company incorporated under the laws of England
and Wales and a wholly-owned subsidiary of the Company. The purpose of Xerox
Capital is to undertake borrowings on behalf of the Company and certain of its
subsidiaries and to advance the proceeds of such borrowings to the Company and
certain of its subsidiaries.
ENFORCEABILITY OF CERTAIN CIVIL LIABILITIES
Some of the directors of Xerox Capital (and certain of the experts named
herein) are citizens or residents of jurisdictions other than the United States.
All or a substantial portion of the assets of such directors, executive officers
and experts reading outside of the United States and all of the assets of Xerox
Capital are or may be located outside the United States. As a result, it may not
be possible to effect service of process on such directors, executive officers
or experts or Xerox Capital in the United states or to enforce, collect or
realize, in United States courts, upon judgments that may be obtained against
such persons in United States courts and predicated upon civil liability under
United States securities laws. The Company and Xerox Capital have been advised
by Lovell White Durrant, special English counsel to the Company and Xerox
Capital, that there is doubt as to the enforceability in England and Wales in
original actions or actions for the enforcement of judgments of United States
courts, of civil liabilities predicated solely on United States Federal
securities laws. The indenture pursuant to which the Debt Securities will be
issued will provide that Xerox Capital will appoint the Company as its agent for
service of process in any suit, action or proceeding with respect to such
indenture brought under Federal or state securities laws in any Federal or state
court located in The City of New York, and will submit to such jurisdiction.
Xerox Capital, Xerox Overseas and Rank Xerox Limited are proposing to enter
into an Amended and Restated Subscription Agreement (the "Subscription
Agreement") which, when executed, will amend and restate an existing amended and
restated subscription agreement dated as of April 18, 1997 between Rank Xerox
Limited and Xerox Capital (the "Original Subscription Agreement"). Pursuant to
the Subscription Agreement, Rank Xerox Limited or, if Xerox Capital shall at the
relevant time have become a majority-owned subsidiary of Xerox Overseas, Xerox
Overseas will agree, on written demand by Xerox Capital, to subscribe for
additional shares in the share capital of Xerox Capital and to pay in cash to
Xerox Capital in exchange therefor an amount equal to the Required Amount, which
is 25 percent of Xerox Capital's then outstanding indebtedness (excluding
contingent liabilities). In addition, if at any time after Xerox Capital has
served a first demand under the Subscription Agreement, the Shareholding, which
is an amount equal to the par value, together with any premium, of Rank Xerox
Limited's or Xerox Overseas', as the case may be, shareholding in Xerox Capital,
shall be less than the Required Amount, Rank Xerox Limited or, if Xerox Capital
at the relevant time shall have become a majority-owned subsidiary of Xerox
Overseas, Xerox Overseas, will agree, upon written demand by Xerox Capital, to
4
<PAGE> 42
subscribe and pay in cash for further shares of Xerox Capital in an amount equal
to the difference between the Required Amount and the Shareholding. In the
indenture pursuant to which any Debt Securities of Xerox Capital will be issued,
Xerox Capital has agreed that, in the event of a default by Xerox Capital in the
performance of its obligations to pay the principal of, premium, if any, and
interest, if any, on any such Debt Securities, any Holder of such Debt
Securities shall be entitled to serve upon Xerox Capital a demand requiring it
to serve a written demand on Rank Xerox Limited or, if the Subscription
Agreement shall have been executed and if Xerox Capital shall then have become a
majority-owned subsidiary of Xerox Overseas, Xerox Overseas for the subscription
of additional shares in the share capital of Xerox Capital in accordance with
and subject to the provisions of the Subscription Agreement (or, prior to
execution thereof, the Original Subscription Agreement). The Original
Subscription Agreement and (following the execution thereof) the Subscription
Agreement may be inspected during normal business hours at the principal
executive office of Xerox Capital. The obligations of Rank Xerox Limited and
Xerox Overseas under the Original Subscription Agreement and the Subscription
Agreement are and will be unsecured, and Rank Xerox Limited is not subject to
any restrictive covenants thereunder. The Original Subscription Agreement and
the Subscription Agreement are and will be governed by English Law.
USE OF PROCEEDS
Except as otherwise set forth in the applicable Prospectus Supplement, the
net proceeds from the sale of the Debt Securities will be added to the general
funds of the Issuers and their subsidiaries and will be used for general
corporate purposes and for the financing or refinancing of any indebtedness
incurred in connection with the acquisition of Rank Group's remaining 20 percent
financial interest in Xerox Limited. See "The Company". The approximate amount
of such net proceeds will be specified in the applicable Prospectus Supplement
and will depend upon the type, aggregate principal amount and initial offering
price of the particular series of Debt Securities to be determined at the time
of sale.
RATIO OF EARNINGS TO FIXED CHARGES OF THE COMPANY
The following table shows the ratio of earnings to fixed charges of the
Company for the periods indicated.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
------------ ---------------------------------
1997 1996 1996 1995 1994 1993* 1992
---- ---- ---- ---- ---- ----- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges(1)(2)..... 3.44 3.28 3.71 3.54 3.23 0.66 2.34
</TABLE>
- ---------------
(1) The ratio of earnings to fixed charges has been computed based on the
Company's continuing operations by dividing total earnings available for
fixed charges, excluding capitalized interest, by total fixed charges. Fixed
charges consist of interest, including capitalized interest, one-third of
rent expense as representative of the interest portion of rentals, and
preferred stock dividend requirements of subsidiaries. Debt has been
assigned to discontinued operations based on historical levels assigned to
the businesses when they were continuing operations, adjusted for subsequent
paydowns. Discontinued operations consist of the Company's Insurance and
Other Financial Services businesses and its real-estate development and
third-party financing businesses.
(2) The Company's ratio of earnings to fixed charges includes the effect of the
Company's finance subsidiaries, which primarily finance Xerox equipment.
Financing businesses are more highly leveraged and, therefore, tend to
operate at lower earnings to fixed charges ratio levels than do non-
financial businesses.
* 1993 earnings were inadequate to cover fixed charges. The coverage
deficiency was $249 million.
5
<PAGE> 43
DESCRIPTION OF THE DEBT SECURITIES AND THE GUARANTEES
The following description of the terms of the Debt Securities and the
Guarantees sets forth certain general terms and provisions of the Debt
Securities and Guarantees to which any Prospectus Supplement may relate. The
particular terms of the Debt Securities and Guarantees offered by any Prospectus
Supplement and the extent, if any, to which such general provisions may apply to
the Debt Securities and Guarantees will be described in the Prospectus
Supplement relating to such Debt Securities and Guarantees. Accordingly, for a
description of the terms of a particular issue of Debt Securities, reference
must be made to both the Prospectus Supplement relating thereto and to the
following description.
The Debt Securities and Guarantees will be issued in one or more series
under an Indenture dated as of August , 1997, among the Company, the
Subsidiary Issuers and Citibank, N.A., as Trustee (the "Trustee") (as may be
amended, supplemented or modified from time to time, the "Indenture"). A copy of
the Indenture is filed as an exhibit to the Registration Statement. The
following summaries of certain provisions of the Indenture do not purport to be
complete and are subject to, and are qualified in their entirety by reference
to, all the provisions of the Indenture and the provisions of the Trust
Indenture Act of 1939, as amended (the "TIA"). Capitalized terms used but not
defined herein shall have the meanings assigned to such terms in the Indenture.
References in parentheticals below to sections or articles are to Sections or
Articles of the Indenture.
The Indenture does not contain any covenants or provisions which may afford
holders of Debt Securities protection in the event of a highly leveraged
transaction by any of the Issuers. No such transaction is contemplated.
GENERAL
The Indenture does not limit the aggregate principal amount of Debt
Securities that may be issued thereunder. The Debt Securities may be issued in
one or more series as may be authorized from time to time by the applicable
Issuer. The Company will irrevocably and unconditionally guarantee payments of
principal, premium, if any, and interest, if any, with respect to Debt
Securities issued by the Subsidiary Issuers. Reference is made to the applicable
Prospectus Supplement for the following terms of the Debt Securities: (1) the
title and aggregate principal amount of such Debt Securities; (2) the percentage
or percentages of their principal amount at which such Debt Securities will be
issued; (3) the date or dates on which such Debt Securities will mature; (4) the
rate or rates (which may be fixed or variable) or the method of determination
thereof, at which such Debt Securities will bear interest, if any; (5) the dates
on which such interest, if any, shall accrue or the method by which such dates
shall be determined and the dates on which such interest, if any, will be
payable; (6) the terms for redemption or early repayment, if any; (7) the
denominations in which such Debt Securities are authorized to be issued; (8)
whether such Debt Securities are issuable in registered and/or bearer form; (9)
whether such Debt Securities are to be issued as Discount Securities (as defined
below) and the amount of discount with which such Debt Securities will be
issued; (10) whether such Debt Securities are to be issued in whole or in part
in the form of one or more Global Securities and, if so, the identity of the
Depositary (as defined below) for such Global Security or Securities; (11) if a
temporary Debt Security is to be issued with respect to such series, whether any
interest thereon payable on an Interest Payment Date prior to the issuance of a
definitive Debt Security of the series will be credited to the account of the
Persons entitled thereto on such Interest Payment Date; (12) if a temporary
Global Security is to be issued with respect to such series, the terms upon
which beneficial interests in such temporary Global Security may be exchanged in
whole or in part for beneficial Interests in a definitive Global Security or for
individual Debt Securities of the series and the terms upon which beneficial
interests in a definitive Global Security, if any, may be exchanged for
individual Debt Securities of the series; (13) the currency, currencies or
currency units in which the purchase price for, the principal of and any premium
and any interest on, the Debt Securities may be payable; (14) if the currency,
currencies or currency units in which the purchase price for, the principal of
and any premium and any interest on, the Debt Securities may be payable is at
the purchaser's election, the time period within which, and the manner in which
and the terms and conditions upon which such election may be made; (15) the
securities exchange or exchanges, if any, on which the
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Debt Securities will be listed; (16) whether any underwriter(s) will act as
market maker(s) for the Debt Securities; (17) if the Debt Securities are listed
on a securities exchange and no underwriter(s) intends to make a market in the
Debt Securities, the nature of the exchange market for the Debt Securities; (18)
if the Debt Securities are not listed on a securities exchange, the extent to
which a secondary market is expected to develop; (19) any addition to or change
in the Events of Default with respect to the Debt Securities and any change in
the right of the Trustee or the holders to declare the principal, premium and
interest with respect to such Debt Securities due and payable; (20) Debt
Securities issued by a Subsidiary Issuer will be entitled to the benefits of the
Guarantees afforded by the Indenture, or any other form of Guarantee to be
endorsed on the Debt Securities; and (21) any additional terms (which terms
shall not be inconsistent with the provisions of the Indenture).
One or more series of Debt Securities may be sold at a substantial discount
below their stated principal amount, bearing no interest or interest at a rate
which at the time of issuance is below market rates ("Discount Securities"). One
or more series of Debt Securities may be variable rate debt securities that may
be exchanged for fixed rate Debt Securities. Federal income tax consequences and
special considerations applicable to any such series will be described in the
Prospectus Supplement relating thereto.
Debt Securities may be issued, from time to time, with the principal amount
payable on any principal payment date, or the amount of interest, if any,
payable on an interest payment date, to be determined by reference to one or
more currency exchange rates, commodity prices, equity indices or other factors.
Holders of such Debt Securities may receive a principal amount on any principal
date, or a payment of interest, if any, on any interest payment date, that is
greater than or less than the amount of principal or interest otherwise payable
on such dates, depending upon the value on such dates of the applicable
currencies, commodities, equity indices or other factors. Information as to the
methods for determining the amount of principal or interest, if any, payable on
any date, the currencies, commodities, equity indices or other factors to which
the amount payable on such date is linked and certain additional Federal income
tax considerations will be set forth in the Prospectus Supplement relating
thereto.
As used herein, the term Debt Securities shall include Debt Securities
denominated in U.S. dollars or, at the option of the applicable Issuer if so
specified in the applicable Prospectus Supplement, in any other freely
transferable currency or units based on or relating to foreign currencies,
including ECU.
If a Prospectus Supplement specifies that Debt Securities are denominated
in a currency or currency unit other than U.S. dollars, such Prospectus
Supplement shall also specify the denominations in which such Debt Securities
will be issued and the coin or currency in which the principal, premium, if any,
and interest, if any, on such Debt Securities, will be payable, which may be
U.S. dollars based upon the exchange rate for such other currency existing on or
about the time a payment is due.
Unless otherwise indicated in the applicable Prospectus Supplement, the
Debt Securities will be issued in fully registered form without coupons and in
denominations of $1,000 and any integral multiple thereof. (Section 3.02)
Subject to the limitations provided in the Indenture and in the Prospectus
Supplement relating thereto, Debt Securities which are issued in registered form
may be transferred or exchanged at the office of the transfer agent maintained
in the Borough of Manhattan, The City of New York or the Principal Corporate
Trust Office of the Trustee, without the payment of any service charge, other
than any tax or other governmental charge payable in connection therewith.
(Section 3.05)
GUARANTEES
The Company will irrevocably and unconditionally guarantee to each Holder
of Debt Securities issued by a Subsidiary Issuer the due and punctual payment of
the principal of, and any premium and interest on, such Debt Securities, when
and as the same shall become due and payable, whether at maturity, upon
acceleration or otherwise. The Company has (a) agreed that its obligations under
the Guarantees upon the occurrence and continuance of an Event of Default will
be as if it were principal obligor and not merely surety, and will be
enforceable irrespective of any invalidity, irregularity or unenforceability of
any series of the Debt Securities or the Indenture and (b) waived its right to
require the Trustee or the
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Holders of Debt Securities to pursue or exhaust their legal or equitable
remedies against the applicable Subsidiary Issuer prior to exercising their
rights under the Guarantees.
With respect to any Debt Securities issued by Xerox Capital, in the event
of a default by Xerox Capital in the performance of its obligations to pay the
principal of, premium, if any, and interest, if any, on any such Debt
Securities, any Holder of such Debt Securities shall be entitled to serve upon
Xerox Capital a demand and upon receipt Xerox Capital shall, if and to the
extent that it shall have rights to call for the subscription of further shares
under the Original Subscription Agreement, serve upon Rank Xerox Limited, or if
the Subscription Agreement shall then have been executed, serve upon Rank Xerox
Limited or, if Xerox Capital shall then have become a majority-owned subsidiary
of Xerox Overseas, Xerox Overseas, a written demand for the subscription of
additional shares in the share capital of Xerox Capital pursuant to and subject
to the provisions of the Original Subscription Agreement or the Subscription
Agreement, as the case may be.
RANKING
The Debt Securities issued by the Company and the Guarantees will be
unsecured obligations of the Company, and will rank pari passu with all other
unsecured and unsubordinated debt of the Company. The Debt Securities issued by
a Subsidiary Issuer will be unsecured obligations of such Subsidiary Issuer, and
will rank pari passu with all other unsecured and unsubordinated debt of such
Subsidiary Issuer.
GLOBAL SECURITIES
Unless otherwise specified in the applicable Prospectus Supplement, the
following provisions will apply to Debt Securities issued by the Issuers.
The Debt Securities of a series may be issued in whole or in part in the
form of one or more Global Securities that will be deposited with, or on behalf
of, a depositary (the "Depositary") identified in the Prospectus Supplement
relating to such series. Global Securities will be issued in registered form and
in either temporary or definitive form. Unless and until it is exchanged in
whole or in part for the individual Debt Securities represented thereby, a
Global Security may not be transferred except as a whole by the Depositary for
such Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any such nominee to a successor of such Depositary or a nominee of
such successor. (Sections 3.01, 3.03 and 3.05)
The specific terms of the depositary arrangement with respect to any Debt
Securities of a series and the rights of and limitations upon owners of
beneficial interests in a Global Security representing a series of Debt
Securities will be described in the Prospectus Supplement relating to such
series. The Issuers anticipate that the following provisions will generally
apply to depositary arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security or its nominee will credit, on its book-entry registration and transfer
system, the respective principal amounts of the individual Debt Securities
represented by such Global Security to the accounts of persons that have
accounts with such Depositary. Such accounts shall be designated by the dealers,
underwriters or agents with respect to such Debt Securities or by the Company if
such Debt Securities are offered and sold directly by the Company. Ownership of
beneficial interests in a Global Security will be limited to persons that have
accounts with the applicable Depositary ("participants") or persons that may
hold interests through participants. Ownership of beneficial interests in such
Global Security will be shown on, and the transfer of that ownership will be
effected only through, records maintained by the applicable Depositary or its
nominee (with respect to interests of participants) and the records of
participants (with respect to interests of persons other than participants). The
laws of some states require that certain purchasers of securities take physical
delivery of such securities in definitive form. Such limits and such laws may
impair the ability to transfer beneficial interests in Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or
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holder of the Debt Securities represented by such Global Security for all
purposes under the Indenture governing such Debt Securities. Except as provided
below, owners of beneficial interests in a Global Security will not be entitled
to have any of the individual Debt Securities of the series represented by such
Global Security registered in their names, will not receive or be entitled to
receive physical delivery of any such Debt Securities of such series in
definitive form and will not be considered the owners or holders thereof under
the Indenture governing such Debt Securities.
Payments of principal, premium, if any, and interest, if any, on individual
Debt Securities represented by a Global Security registered in the name of a
Depositary or its nominee will be made to the Depositary or its nominee, as the
case may be, as the registered owner of the Global Security representing such
Debt Securities. None of the Issuers, the Trustee for such Debt Securities, any
paying agent (a "Paying Agent"), or the Registrar for such Debt Securities will
have any responsibility or liability for any aspect of the records relating to
or payments made by the Depositary or any participants on account of beneficial
ownership interests of the Global Security for such Debt Securities or for
maintaining, supervising or reviewing any records relating to such beneficial
ownership interests.
The Issuers expect that the Depositary for a series of Debt Securities or
its nominee, upon receipt of any payment of principal, premium or interest in
respect of a permanent Global Security representing any of such Debt Securities,
immediately will credit participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the principal amount
of such Global Security for such Debt Securities as shown on the records of such
Depositary or its nominee. The Issuers also expect that payments by participants
to owners of beneficial interests in such Global Security held through such
participants will be governed by standing instructions and customary practices,
as is now the case with securities held for the accounts of customers in bearer
form or registered in "street name". Such payments will be the responsibility of
such participants.
If the Depositary for a series of Debt Securities is at any time unwilling,
unable or ineligible to continue as depositary and a successor depositary is not
appointed by the applicable Issuer within 90 days, such Issuer will issue
definitive Debt Securities of such series in exchange for the Global Security or
Securities representing such series of Debt Securities. In addition, the
applicable Issuer may at any time and in its sole discretion, subject to any
limitations described in the Prospectus Supplement relating to such Debt
Securities, determine not to have any Debt Securities of a series represented by
one or more Global Securities, and, in such event, will issue definitive Debt
Securities of such series in exchange for the Global Security or Securities
representing such series of Debt Securities. Further, if the applicable Issuer
so specifies with respect to the Debt Securities of a series, an owner of a
beneficial interest in a Global Security representing Debt Securities of such
series may, on terms acceptable to such Issuer, the Trustee, and the Depositary
for such Global Security, receive definitive Debt Securities of such series in
exchange for such beneficial interests, subject to any limitations described in
the Prospectus Supplement relating to such Debt Securities. In any such
instance, an owner of a beneficial interest in a Global Security will be
entitled to physical delivery of definitive Debt Securities of the series
represented by such Global Security equal in principal amount to such beneficial
interest and to have such Debt Securities registered in its name. Definitive
Debt Securities of such series so issued will be issued in denominations, unless
otherwise specified by the applicable Issuer, of $1,000 and integral multiples
thereof.
COVENANTS
Limitations on Liens. So long as any of the Debt Securities of any Issuer
are outstanding, the Company will not create or suffer to exist, or permit any
of its Restricted Subsidiaries to create or suffer to exist, any lien, security
interest or other charge or encumbrance, or any other type of preferential
arrangement, upon or with respect to any of its properties (other than "margin
stock" as that term is defined in Regulation U issued by the Board of Governors
of the Federal Reserve System), whether now owned or hereafter acquired, or
assign, or permit any of its Restricted Subsidiaries to assign, any right to
receive income, in each case to secure any Debt without making effective
provision whereby all of the Debt Securities of each series (together with, if
the Company shall so determine, any other Debt of the Company or such Restricted
Subsidiary then existing or thereafter created which is not subordinate to the
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Debt Securities) shall be equally and ratably secured with the indebtedness or
obligations secured by such security; provided, however, that the Company or its
Restricted Subsidiaries may create or suffer to exist any lien, security
interest, charge, encumbrance or preferential arrangement of any kind in, of or
upon any of the properties or assets of the Company or its Restricted
Subsidiaries to secure any Debt or Debts in an aggregate amount at any time
outstanding not greater than 20% of the Consolidated Net Worth of the Company;
and provided, further, that the foregoing restrictions shall not apply to any of
the following: (1) deposits, liens or pledges arising sin the ordinary course of
business to enable the Company or any of its Restricted Subsidiaries to exercise
any privilege or license or to secure payments of workers' compensation or
unemployment insurance, or to secure the performance of bids, tenders, contracts
(other than for the payment of money) or statutory landlords' liens or to secure
public or statutory obligations or surety, stay or appeal bonds, or other
similar deposits or pledges made in the ordinary course of business; (2) liens
imposed by law or other similar liens, if arising in the ordinary course of
business, such as mechanic's, materialman's, workman's, repairman's or carrier's
liens, or deposits or pledges in the ordinary course of business to obtain the
release of such liens; (3) liens arising out of judgments or awards against the
Company or any of its Restricted Subsidiaries in an aggregate amount not to
exceed the greater of (a) 15% of the Consolidated Net Worth of the Company or
(b) the minimum amount which, if subtracted from such Consolidated Net Worth,
would reduce such Consolidated Net Worth below $3.2 billion and, in each case,
with respect to which the Company or such Restricted Subsidiary shall in good
faith be prosecuting an appeal or proceedings for review, or liens for the
purpose of obtaining a stay or discharge in the course of any legal proceedings;
(4) liens for taxes if such taxes are not delinquent or thereafter can be paid
without penalty, or are being contested in good faith by appropriate
proceedings, or minor survey exceptions or minor encumbrances, easements or
restrictions which do not in the aggregate materially detract from the value of
the property so encumbered or restricted or materially impair their use in the
operation of the business of the Company or any Restricted Subsidiary owning
such property; (5) liens in favor of any government or department or agency
thereof or in favor of a prime contractor under a government contract and
resulting from the acceptance of progress or partial payments under government
contracts or subcontracts thereunder; (6) liens, security interests, charges,
encumbrances, preferential arrangements and assignments of income existing on
the date of the Indenture; (7) purchase money liens or security interests in
property acquired or held by the Company or any Restricted Subsidiary in the
ordinary course of business to secure the purchase price thereof or indebtedness
incurred to finance the acquisition thereof; (8) liens or security interests
existing on property at the time of its acquisition; (9) the rights of XCC
relating to a certain reserve account established pursuant to an operating
agreement dated as of November 1, 1980, between the Company and XCC; (10) the
replacement, extension or renewal of any of the foregoing and (11) liens on any
assets of any Restricted Subsidiary of up to $500,000,000 incurred in connection
with the sale or assignment of assets of such Restricted Subsidiary for cash
where the proceeds are applied to repayment of Debt of such Restricted
Subsidiary and/or invested by such Restricted Subsidiary in assets which would
be reflected as receivables on the balance sheet of such Restricted Subsidiary.
(Section 5.06)
"Consolidated Net Worth" means, at any time, as to a given entity, (a) the
sum of the amounts appearing on the latest consolidated balance sheet of such
entity and its Subsidiaries, prepared in accordance with generally accepted
accounting principles consistently applied, as (i) the par or stated value of
all outstanding capital stock (including preferred stock), (ii) capital paid-in
and earned surplus or earnings retained in the business plus or minus cumulative
translation adjustments, (iii) any unappropriated surplus reserves, (iv) any net
unrealized appreciation of equity investments, and (v) minorities' interests in
equity of subsidiaries, less (b) treasury stock, plus (c) in the case of the
Company, $600,000,000.
"Debt" means (i) indebtedness for borrowed money or for the deferred
purchase price of property or services (excluding trade accounts payable
incurred in the ordinary course with a maturity of not greater than 90 days),
(ii) obligations as lessee under capital leases, (iii) obligations under direct
or indirect guaranties in respect of, and obligations (contingent or otherwise)
to purchase or otherwise acquire, or otherwise to assure a creditor against loss
in respect of, indebtedness or obligations of others
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of the kinds referred to in clause (i) or (ii) (excluding obligations of the
Company from time to time under (1) a certain support agreement between the
Company and XCC, and (2) a certain support agreement between Xerox Canada Inc.
and Xerox Canada Finance Inc.), and (iv) the amount of unfunded benefit
liabilities, as defined in Section 4001 (a)(18) of the Employee Retirement
Income Security Act of 1974, as amended from time to time, and any successor
statute or statute, under plans covered by Title IV thereof.
"Restricted Subsidiary" means any consolidated Subsidiary of the Company
from time to time having a Consolidated Net Worth of at least $100 million;
provided, however, that "Restricted Subsidiary" does not include Xerox Financial
Services, Inc., XCC and any other corporation principally engaged in any
business or businesses other than development, manufacture and/or marketing of
(x) business equipment (including, without limitation, reprographic, computer
(including software) and facsimile equipment), (y) merchandise or (z) services
(other than financial services). At the date hereof, the Company has the
following Restricted Subsidiaries: (i) Lyell Holdings Limited, (ii) Rank Xerox
Limited, (iii) Rank Xerox Holding B.V., (iv) Rank Xerox Manufacturing
(Nederland) B.V., (v) Xerox do Brazil Ltda., (vi) Xerox Canada Inc., (vii) Xerox
Canada Ltd., and (viii) Xerox Mexicana S.A. de C.V. The Company intends to
change the names of Rank Xerox Limited, Rank Xerox Holding B.V. and Rank Xerox
Manufacturing (Nederland) B.V. to Xerox Limited, Xerox Holding B.V. and Xerox
Manufacturing (Nederland) B.V., respectively, or to other names which denote the
nonaffiliation of Rank Group in such companies.
"Subsidiary" means, as to any entity, any corporation of which more than
50% of the outstanding capital stock having ordinary voting power to elect a
majority of the Board of Directors of such corporation is at the time directly
or indirectly owned by such entity.
Consolidation, Merger or Sale of Assets of the Company. The Company shall
not consolidate with or merge into any other corporation or sell its assets
substantially as an entirety, unless (1) the corporation formed by such
consolidation or into which the Company is merged or the corporation which
acquires its assets is organized in the United States and expressly assumes the
due and punctual payment of the principal of, premium, if any, and interest, if
any, on all the Debt Securities of the Company and the Guarantees and the
performance of every covenant of the Indenture on the part of the Company to be
performed or observed and (2) immediately after giving effect to such
transaction, no Event of Default, and no event which, after notice or lapse of
time, or both, would become an Event of Default, shall have occurred and be
continuing. (Section 10.01) Upon any such consolidation, merger or sale, the
successor corporation formed by such consolidation or into which the Company is
merged or to which such sale is made shall succeed to and be substituted for the
Company under the Indenture. (Section 10.02)
Consolidation, Merger or Sale of Assets of Subsidiary Issuers. Neither of
the Subsidiary Issuers shall consolidate with or merge into any other
corporation or sell its assets substantially as an entirety, unless (1) the
corporation formed by such consolidation or into which such Subsidiary Issuer is
merged or the corporation which acquires its assets is organized in the United
States or in England and Wales and expressly assumes the due and punctual
payment of the principal of, premium, if any, and interest, if any, on all the
Debt Securities of such Subsidiary Issuer and the performance of every covenant
of the Indenture on the part of such Subsidiary Issuer to be performed or
observed and (2) immediately after giving effect to such transaction, no Event
of Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have occurred and be continuing. (Section
10.02) Notwithstanding the foregoing, any Subsidiary Issuer shall be entitled at
any time to sell, transfer or assign all or any part of its assets for fair
value or grant any interest therein to any person or persons in accordance with
any Securitization in relation to such assets (whether or not by such Subsidiary
Issuer or any of its subsidiaries) and to enter into any arrangements in
connection therewith. (Section 10.02) Upon any such consolidation, merger or
sale, the successor corporation formed by such consolidation, or into which any
such Subsidiary Issuer is merged or to which such sale is made shall succeed to
and be substituted for such Subsidiary Issuer under the Indenture. (Section
10.03)
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For the purposes of the immediately preceding paragraph, "Securitization"
means any financing (whether or not by any Subsidiary Issuer, involving the
transfer, assignment or charging for fair value of lease, trade and/or finance
receivables and whether or not involving the issue of securities) where payments
of principal and interest thereunder are derived principally either directly or
after conversion through one or more interest rate and/or currency swap
agreements from moneys receivable (for a fair value) under or in connection with
such lease, trade and/or finance receivables and where the proceeds of such
financing are applied in repayment of debt and/or invested in assets.
ASSIGNMENT
The Indenture provides that for so long as any of the Debt Securities of a
Subsidiary Issuer are outstanding, such Subsidiary Issuer may assign its
obligations under any series of Debt Securities to any other subsidiary of the
Company (the "Subsidiary Assignee") and such Subsidiary Assignee shall be
treated as the successor to such Subsidiary Issuer with respect to such series
of Debt Securities; provided, that the conditions set forth under
"Consolidation, Merger or Sale of Assets of Xerox Overseas" or "Consolidation,
Merger or Sale of Assets of Xerox Capital" above, as applicable, that would
apply to the merger of such Subsidiary Issuer into such Subsidiary Assignee are
satisfied.
EVENTS OF DEFAULT, NOTICE AND WAIVER
The Indenture provides that, if an Event of Default specified therein in
respect of any series of Debt Securities of an Issuer or any Guarantees thereof
shall have happened and be continuing, either the Trustee or the Holders of not
less than 25% in principal amount of the outstanding Debt Securities of such
series of such Issuer may declare the principal amount (or a portion thereof in
the case of certain Debt Securities of such Issuer issued with an original issue
discount) of all the Debt Securities of such series of such Issuer to be
immediately due and payable. (Section 7.02)
Events of Default in respect of any series of Debt Securities of an Issuer
or any Guarantees thereof are defined in the Indenture as being: default for 30
days in payment of any interest installment when due; default in payment of
principal of or premium, if any, (including accrued original issue discount, in
the case of certain Debt Securities of such Issuer issued with original issue
discount) on, or any sinking fund installment or analogous obligation with
respect to, Debt Securities of such series of such Issuer when due; default for
90 days after notice to such Issuer or the Guarantor by the Trustee or by the
holders of at least 25% in principal amount of the outstanding Debt Securities
of such series of such Issuer in performance of any covenant in such Indenture
in respect of the Debt Securities of such series of such Issuer; certain events
of bankruptcy, insolvency and reorganization involving such Issuer or the
Guarantor; and any other Event of Default provided for with respect to the Debt
Securities of such series of such Issuer. (Section 7.01)
The TIA provides that the Trustee will, within 90 days after the occurrence
of a default in respect of any series of Debt Securities of an Issuer or any
Guarantees thereof, give to the Holders of such series of such Issuer notice of
all uncured and unwaived defaults known to it; provided that, except in the case
of default in the payment of principal of, premium, if any, or interest, if any,
on, or any sinking fund installment or analogous obligation with respect to, any
of the Debt Securities of such series of such Issuer, the Trustee will be
protected in withholding such notice if it in good faith determines that the
withholding of such notice is in the interest of the Holders of such series of
such Issuer. The term "default" for the purpose of this provision means any
event which is, or after notice or lapse of time or both would become, an Event
of Default with respect to Debt Securities of such series of such Issuer or any
Guarantees thereof.
The Indenture provides that the Holders of a majority in principal amount
of the outstanding Debt Securities of any series of an Issuer may, subject to
certain limitations, direct the time, method and place of conducting proceedings
for remedies available to the Trustee, or exercising any trust or power
conferred on the Trustee, in respect of the Debt Securities of such series of
such Issuer. (Section 7.11)
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The Indenture contains provisions entitling the Trustee, subject to the
duty of the Trustee during an Event of Default in respect of any series of Debt
Securities of an Issuer or any Guarantees thereof to act with the required
standard of care, to be indemnified by the Holders of the Debt Securities of
such series of such Issuer before proceeding to exercise any right or power
under such Indenture at the request of Holders of the Debt Securities of such
series of such Issuer. (Section 8.01)
The Indenture includes covenants that the Company will file annually with
the Trustee a certificate of no default, or specifying any default that exists.
(Section 5.04)
In certain cases, the Holders of a majority in principal amount of the
outstanding Debt Securities of a series of an Issuer may, on behalf of the
Holders of all Debt Securities of such series of such Issuer, waive any past
default or Event of Default, or compliance with certain provisions of the
Indenture, except for defaults not theretofore cured in the payment of the
principal of, premium, if any, or interest on, or any sinking fund instalment or
analogous obligation with respect to, any of the Debt Securities of such series
of such Issuer and compliance with certain covenants. (Sections 5.07, 7.02 and
7.12)
The Indenture provides that for purposes of calculating the principal
amount of Debt Securities of any series denominated in a foreign currency or in
units based on or relating to currencies thereunder, such principal amount shall
be deemed to be that amount of United States dollars that could be obtained for
such principal amount on the basis of a spot rate of exchange, specified to the
Trustee by the applicable Issuer in an Officers' Certificate, for such currency
or currency units into United States dollars as of the date of any such
calculation. (Section 1.15)
ASSUMPTION BY THE COMPANY
The Company may, at its option, assume the obligations of any Subsidiary
Issuer as obligor under any series of Debt Securities, provided, that (a) the
Company shall expressly assume such obligations in an assumption agreement or
supplemental indenture duly executed and delivered to the Trustee in form
reasonably satisfactory to the Trustee and (b) immediately after giving effect
to such assumption, no Event of Default, and no event which, after notice or
lapse of time, or both, would become an Event of Default, shall have occurred
and be continuing. Upon any such assumption, the Company shall succeed to, and
be substituted for, and may exercise every right and power of, the applicable
Subsidiary Issuer under such series of Debt Securities and the Indenture with
the same effect as if the Company had been the Issuer thereof, and the
applicable Subsidiary Issuer shall be released from its liability as obligor
under such series of Debt Securities. (Section 10.05)
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting the applicable Issuer, the
Guarantor and the Trustee, with the consent of the Holders of at least a
majority in principal amount of the outstanding Debt Securities of the affected
series, to execute supplemental indentures adding any provisions to or changing
or eliminating any of the provisions of the Indenture or modifying the rights of
the holders of Debt Securities of such series, except that no such supplemental
indenture may, without the consent of the Holders of all of the affected Debt
Securities, among other things, change the maturity of any Debt Securities, or
the currency in which such Debt Securities are payable, reduce the principal
amount thereof or any premium thereon, reduce the rate or extend the time of
payment of interest thereon, change the method of computing the amount of
principal thereof on any date or reduce the aforesaid percentage of Debt
Securities, the consent of the holders of which is required for any such
supplemental indenture. (Section 9.02)
SATISFACTION AND DISCHARGE OF THE INDENTURES; DEFEASANCE
The Indenture shall generally cease to be of any further effect with
respect to a series of Debt Securities if (a) the applicable Issuer or the
Guarantor has delivered to the Trustee for cancellation all such Debt Securities
of such series (with certain limited exceptions) or (b) all such Debt Securities
of such series not theretofore delivered to the Trustee for cancellation shall
have become due and payable,
13
<PAGE> 51
or are by their terms to become due and payable within one year or are to be
called for redemption within one year, and the applicable Issuer or the
Guarantor shall have deposited with the Trustee as trust funds the entire amount
sufficient to pay at maturity or upon redemption all such Debt Securities of
such series (and if, in either case, the applicable Issuer or the Guarantor
shall also pay or cause to be paid all other sums payable under the Indenture by
such Issuer or Guarantor in respect of all such Debt Securities of such series
and deliver to the Trustee an officers' certificate and an opinion of counsel,
each stating that all conditions precedent in the Indenture have been complied
with). (Section 11.01)
The Trustee shall hold in trust all money deposited with it as described
above and shall apply the deposited money, in accordance with the provisions of
the Debt Securities of the defeased series and the Indenture, to the payment,
either directly or through any Paying Agent, as the Trustee may determine, to
the Persons entitled thereto, of principal, premium, if any, and interest for
whose payment such money has been deposited with the Trustee. (Section 11.02)
CONCERNING THE TRUSTEE
The Issuers may from time to time maintain credit facilities, and have
other customary banking relationships with Citibank, N.A., the Trustee under the
Indenture.
SUBMISSION TO JURISDICTION AND SERVICE OF PROCESS
Each Subsidiary Issuer submits for the exclusive benefit of the Holders of
its Debt Securities to the non-exclusive jurisdiction of any United States
Federal or New York State court sitting in New York City, the Borough of
Manhattan solely for the purpose of any legal action or proceeding brought to
enforce rights under its Debt Securities and the Indenture. As long as any of
its Debt Securities remains outstanding (unless all payments are then being made
by the Guarantor), each Subsidiary Issuer shall either have an authorized agent
or maintain an office in New York State upon whom process may be served in any
such legal action or proceeding. Service of process upon any Subsidiary Issuer
at its office or upon its agent with written notice of such service mailed or
delivered to such Subsidiary Issuer shall to the fullest extent permitted by
applicable law be deemed in every respect effective service of process upon such
Subsidiary Issuer in any such legal action or proceeding. Each Subsidiary Issuer
hereby appoints the Company, Xerox Square, 100 Clinton Avenue South, Rochester,
New York, 14644, U.S.A., Attention: General Counsel, as its agent in New York
State for such purpose, and the Company accepts such appointment. Each
Subsidiary Issuer covenants and agrees that service of process in any legal
action or proceeding may be made upon it at its office, or upon its agent in New
York State. Each Subsidiary Issuer irrevocably waives (and irrevocably agrees
not to raise) any objection which it may now have or hereafter to the laying of
venue of any such actions or proceedings in any such court referred to in this
paragraph and any claim that any such actions or proceedings have been brought
in an inconvenient forum and further irrevocably agrees that a judgment in any
action or proceeding brought in any court referred to in this paragraph shall be
conclusive and binding upon it and may be enforced in the courts of any other
jurisdiction.
GOVERNING LAW
The Indenture, the Debt Securities and the Guarantees shall be construed in
accordance with and governed by the laws of the State of New York, without
giving effect to the principles thereof relating to conflicts of law (other than
Section 5-1401 of the General Obligations Law of the State of New York, and any
successor statute or statutes); provided, however, that all matters governing
the authorization and execution of the Indenture and the Debt Securities of each
Subsidiary Issuer shall be construed in accordance with and governed by the laws
of the jurisdiction of organization of such Subsidiary Issuer.
LIMITATIONS AFFECTING SECURITY HOLDERS
Neither the law of England and Wales nor the organizational documents of
any Subsidiary Issuer imposes any restriction on the ability of non-United
Kingdom Holders to hold or vote the Debt Securities.
14
<PAGE> 52
PLAN OF DISTRIBUTION
Each Issuer may sell the Debt Securities being offered hereby in any one or
more of the following ways: (1) directly to investors, (2) to investors through
agents, (3) to broker-dealers as principals, (4) through underwriting syndicates
led by one or more managing underwriters as such Issuer may select from time to
time, or (5) through one or more underwriters acting alone.
If an underwriter or underwriters are utilized in the sale, the specific
managing underwriter or underwriters with respect to the offer and sale of the
Offered Debt Securities are set forth on the cover of the Prospectus Supplement
relating to such Offered Debt Securities and the members of the underwriting
syndicate, if any, are named in such Prospectus Supplement.
Sales of the Offered Debt Securities by underwriters may be in negotiated
transactions, at a fixed offering price or at various prices determined at the
time of sale. The Prospectus Supplement describes the method of reoffering by
the underwriters. The Prospectus Supplement also describes the discounts and
commissions to be allowed or paid to the underwriters, if any, all other items
constituting underwriting compensation, the discounts and commissions to be
allowed or paid to dealers, if any, and the exchanges, if any, on which the Debt
Securities offered thereby will be listed.
If so indicated in the Prospectus Supplement, each Issuer will authorize
underwriters to solicit offers by certain institutions to purchase Debt
Securities from such Issuer at the price set forth in the Prospectus Supplement
pursuant to Delayed Delivery Contracts providing for payment and delivery at a
future date.
If any Debt Securities are sold pursuant to an Underwriting Agreement, the
several underwriters will agree, subject to the terms and conditions set forth
therein, unless the Prospectus Supplement provides otherwise, to purchase all
the Debt Securities offered by the accompanying Prospectus Supplement if any of
such securities are purchased and, in the event of default by any underwriter,
in certain circumstances, the purchase commitments may be increased or the
Underwriting Agreement may be terminated.
Offers to purchase Debt Securities may be solicited directly by any of the
Issuers or by agents designated by any such Issuer from time to time. Any such
agent, who may be deemed to be an underwriter as the term is defined in the
Securities Act of 1933 (the "Act"), involved in the offer or sale of the Offered
Debt Securities in respect of which this Prospectus is delivered will be named,
and any commissions payable by any of the Issuers to such agent set forth, in a
Prospectus Supplement. Unless otherwise indicated in such Prospectus Supplement,
any such agent will be acting on a best efforts basis.
If a broker-dealer is utilized in the sale of the Offered Debt Securities
in respect of which this Prospectus is delivered, the Issuers will sell such
Offered Debt Securities to the dealer, as principal. The dealer may then resell
such Offered Debt Securities to the public at varying prices to be determined by
such dealer at the time of resale.
Agents, broker-dealers or underwriters may be entitled under agreements
which may be entered into with an Issuer to indemnification or contribution by
such Issuer in respect of certain civil liabilities, including liabilities under
the Act, and may be customers of, engage in transactions with or perform
services for such Issuer in the ordinary course of business.
The place and time of delivery for the Offered Debt Securities in respect
of which this Prospectus is delivered are set forth in the accompanying
Prospectus Supplement.
The Offered Debt Securities may or may not be listed on a national
securities exchange. No assurances can be given that there will be a market for
the Offered Debt Securities.
15
<PAGE> 53
LEGAL OPINIONS
The validity of the Debt Securities and the Guarantees to be offered by the
Company will be passed upon for the Company by Martin S. Wagner, Esq., Associate
General Counsel, Corporate, Finance and Ventures of the Company. The due
authorization, execution and delivery of the Debt Securities to be offered by
the Subsidiary Issuers will be passed upon for such Subsidiary Issuers by Carole
Shephard, Esq., the Company Secretary of Rank Xerox Limited and a Solicitor in
England. Certain other legal matters in connection with the offerings
contemplated herein will be passed upon for the Company and the Subsidiary
Issuers by Martin S. Wagner, Esq., Associate General Counsel, Corporate, Finance
and Ventures of the Company. Certain legal matters in connection with the
offerings contemplated herein will be passed upon for the underwriters, agents
or dealers, as the case may be, by Cravath, Swaine & Moore, Worldwide Plaza, 825
Eighth Avenue, New York, New York. Certain United States Federal income tax
consequences resulting from the purchase, ownership or disposition of the Debt
Securities will be passed upon for the Company by Ivins, Phillips & Barker,
Chartered, 1700 Pennsylvania Avenue, N.W., Washington, D.C.
EXPERTS
The consolidated financial statements and schedule of the Company and
consolidated subsidiaries included in the Company's Annual Report on Form 10-K
as of December 31, 1996 and 1995, and for each of the years in the three-year
period ended December 31, 1996, have been incorporated by reference herein and
elsewhere in the Registration Statement, in reliance upon the report set forth
therein of KPMG Peat Marwick LLP, independent certified public accountants,
incorporated by reference herein, and upon the authority of said firm as experts
in accounting and auditing.
16
<PAGE> 54
=========================================================
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS, IN CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY, ANY SUBSIDIARY ISSUER OR ANY OF THE AGENTS. NEITHER THE DELIVERY OF
THIS PROSPECTUS SUPPLEMENT (INCLUDING THE ACCOMPANYING PRICING SUPPLEMENT) AND
THE PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE
COMPANY OR ANY SUBSIDIARY ISSUER SINCE THE DATES AS OF WHICH INFORMATION IS
GIVEN IN THIS PROSPECTUS SUPPLEMENT (INCLUDING THE ACCOMPANYING PRICING
SUPPLEMENT) AND THE PROSPECTUS. THIS PROSPECTUS SUPPLEMENT (INCLUDING THE
ACCOMPANYING PRICING SUPPLEMENT) AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER
OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION.
------------------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Risk Factors............................ S-2
Description of Notes.................... S-6
Important Currency Exchange
Information........................... S-25
United States Taxation.................. S-26
Plan of Distribution.................... S-35
PROSPECTUS
Available Information................... 2
Incorporation of Certain Documents by
Reference............................. 2
The Company............................. 3
Xerox Overseas.......................... 3
Xerox Capital........................... 4
Use of Proceeds......................... 5
Ratio of Earnings to Fixed Charges...... 5
Description of the Debt Securities...... 6
Plan of Distribution.................... 15
Legal Opinions.......................... 16
Experts................................. 16
</TABLE>
=========================================================
=========================================================
U.S. $2,250,000,000
XEROX CORPORATION
XEROX OVERSEAS HOLDINGS PLC
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY
XEROX CORPORATION
RANK XEROX CAPITAL
(EUROPE) PLC
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY
XEROX CORPORATION
MEDIUM-TERM NOTES,
SERIES E
DUE NINE MONTHS OR MORE
FROM DATE OF ISSUE
-----------------------------------------
PROSPECTUS SUPPLEMENT
-----------------------------------------
GOLDMAN, SACHS & CO.
LEHMAN BROTHERS
MERRILL LYNCH & CO.
J.P. MORGAN & CO.
MORGAN STANLEY DEAN WITTER
SALOMON BROTHERS INC
DATED AUGUST , 1997
=========================================================
<PAGE> 55
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.*
The following statement sets forth the expenses, other than underwriting
discounts and commissions, to be borne by the Issuers in connection with the
distribution of the Debt Securities:
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee......... $ 606,061
Printing and Engraving...................................... 50,000
Fees of Legal Counsel to Agents............................. 35,000
Fees of Issuers' Independent Auditors....................... 55,000
Blue Sky Fees and Expenses (including legal fees and
disbursements)............................................ 15,000
Trustee Fees and Expenses (including counsel fees).......... 60,000
Listing Fees................................................ -0-
Rating Agency Fees.......................................... 585,000
Miscellaneous Expenses...................................... -0-
----------
Total................................................ $1,406,061
==========
</TABLE>
- ---------------
* The foregoing expenses, other than the Securities and Exchange Commission
Registration Fee, are estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article VIII, Section 2 of the Company's By-laws states:
"Indemnification of Directors and Officers: Except to the extent
expressly prohibited by law, the Company shall indemnify any person, made
or threatened to be made, a party in any civil or criminal action or
proceeding, including an action or proceeding by or in the right of the
Company to procure a judgment in its favor or by or in the right of any
other corporation of any type or kind, domestic or foreign, or any
partnership, joint venture, trust, employee benefit plan or other
enterprise, which any Director or officer of the Company served in any
capacity at the request of the Company, by reason of the fact that he, his
testator or intestate is or was a Director or officer of the Company or
serves or served such other corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, in any capacity, against
judgments, fines, penalties, amounts paid in settlement and reasonable
expenses, including attorneys' fees, incurred in connection with such
action or proceeding, or any appeal therein, provided that no such
indemnification shall be required with respect to any settlement unless the
Company shall have given its prior approval thereto. Such indemnification
shall include the right to be paid advances of any expenses incurred by
such person in connection with such action, suit or proceeding, consistent
with the provisions of applicable law. In addition to the foregoing, the
Company is authorized to extend rights to indemnification and advancement
of expenses to such persons by i) resolution of the shareholders, ii)
resolution of the Directors or iii) an agreement, to the extent not
expressly prohibited by law."
Reference is made to Sections 721 through 726 of the Business Corporation
Law of the State of New York.
The above provisions of the Company's By-laws provide for indemnification
of directors and officers of subsidiaries of the Company who are also directors
or officers of the Company, to the same extent as directors and officers of the
Company. In addition, paragraph 35 of Xerox Oversea's Articles of Association
and paragraph 111 of Xerox Capital's Articles of Association state:
II-1
<PAGE> 56
"Subject to the provisions of [the Companies Act 1985], every
director, other officer or auditor of the company or person acting as an
alternate director shall be entitled to be indemnified out of the assets of
the company against all costs, charges, expenses, losses or liabilities
which he may sustain or incur in or about the execution of his duties to
the company or otherwise in relation thereto."
ITEM 16. EXHIBITS
<TABLE>
<S> <C>
(1)(a) -- Form of Underwriting Agreement, incorporated by reference to Exhibit
(1)(a) to the Company's Registration Statement on Form S-3, Registration
No. 33-44597.
(1)(b) -- Form of Selling Agency Agreement, incorporated by reference to Exhibit
(1)(b) to the Company's Current Report on Form 8-K dated March 10, 1992.
(4)(a) -- Form of Indenture, incorporated by reference to Exhibit (4)(a) to the
Company's Registration Statement on Form S-3, Registration No. 333-13179.
(4)(b) -- Form of Indenture.
(4)(c) -- Form of Debt Security, incorporated by reference to Exhibit 4(b) to the
Company's Registration Statement on Form S-3, Registration No. 33-7415.
The Form of Debt Security is hereby modified, effective as of August 25,
1997, by replacing all references to Bankers Trust Company with Citibank,
N.A. and changing the date of the indenture referred to therein to as of
August 25, 1997.
(4)(d) -- Form of Debt Security, incorporated by reference to Exhibit 4(c) to the
Company's Registration Statement on Form S-3, Registration No. 33-7415.
The Form of Debt Security is hereby modified, effective as of August 25,
1997, by replacing all references to Bankers Trust Company with Citibank,
N.A. and changing the date of the indenture referred to therein to as of
August 25, 1997.
(4)(e) -- Form of Debt Security, incorporated by reference to Exhibit (1) to the
Company's Registration Statement on Form 8-A dated December 1, 1986 for
its 8 1/8% Notes due 1996. The Form of Debt Security is hereby modified,
effective as of August 25, 1997, by replacing all references to Bankers
Trust Company with Citibank, N.A. and changing the date of the indenture
referred to therein to as of August 25, 1997.
(4)(f) -- Form of Debt Security, incorporated by reference to Exhibit 4(b) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(g) -- Form of Debt Security, incorporated by reference to Exhibit 4(c) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(h) -- Form of Debt Security, incorporated by reference to Exhibit 4(d) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(i) -- Form of Debt Security, incorporated by reference to Exhibit 4(e) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(j) -- Form of Debt Security, incorporated by reference to Exhibit 4(f) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(k) -- Form of Debt Security, incorporated by reference to Exhibit (4)(k) to the
Company's Current Report on Form 8-K dated March 10, 1992.
(4)(l) -- Form of Debt Security, incorporated by reference to Exhibit (4)(k) to the
Company's Current Report on Form 8-K dated May 25, 1994.
(4)(m) -- Form of Debt Security, incorporated by reference to Exhibit (4)(l) to the
Company's Registration Statement on Form S-3, Registration No. 333-13179.
(4)(n) -- Additional Forms of Debt Securities Incorporated by reference to the
Company's subsequently filed reports on Form 8-K.
(4)(o) -- Amended and Restated Subscription Agreement between Rank Xerox Limited and
Xerox Capital.
(4)(p) -- Form of Amended and Restated Subscription Agreement among Rank Xerox
Limited, Xerox Overseas and Xerox Capital.
</TABLE>
II-2
<PAGE> 57
<TABLE>
<S> <C>
(5)(a) -- Opinion of Martin S. Wagner, Esq., as to legality of Debt Securities of
the Company and the Guarantees and certain other legal matters.
(5)(b) -- Opinion of Carole Shephard, Esq., as to legality of Debt Securities of the
Subsidiary Issuers.
(5)(c) -- Opinion of Ivins, Phillips & Barker, Chartered, special U.S. tax counsel
to the Issuers, as to material U.S. tax consequences.
(12) -- Computation of Ratio of Earnings to Fixed Charges of the Company.
(23)(a) -- Consent of Independent Auditors (see page II-6).
(23)(b) -- Consent of Martin S. Wagner, Esq. (see Exhibit 5(a)).
(23)(c) -- Consent of Carole Shephard, Esq. (see Exhibit 5(b)).
(23)(d) -- Consent of Ivins, Phillips & Barker, Chartered, special U.S. tax counsel
to the Company (see Exhibit 5(c)).
(24)(a) -- Certified Resolution of the Board of Directors of the Company.
(24)(b) -- Certified Resolutions of the Boards of Directors of the Subsidiary
Issuers.
(24)(c) -- Power of Attorney of the Company.
(24)(d) -- Power of Attorney of Xerox Overseas.
(24)(e) -- Power of Attorney of Xerox Capital.
(25) -- Statement of Eligibility under the Trust Indenture Act of 1939 on Form T-1
of Citibank, N.A. to act as Trustee under the Indenture.
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned registrants hereby undertakes:
(1) To file, during any period in which offers or sales of the
securities registered hereby 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 of 1933 (the "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 and 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 20
percent change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement; and (iii) to include any material information with respect to
the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement, provided, however, that paragraphs (i) and (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 Company
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that
are incorporated by reference in this registration statement.
(2) That, for the purpose of determining any liability under the 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.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) If the registrant is a foreign private Issuer, to file a
post-effective amendment to the registration statement to include any
financial statements required by Rule 3-19 of Regulation S-X at
II-3
<PAGE> 58
the start of any delayed offering or throughout a continuous offering.
Financial statements and information otherwise required by Section 10(a)(3)
of the Act need not be furnished, provided that the registrant includes in
the prospectus, by means of a post-effective amendment, financial
statements required pursuant to this paragraph (a)(4) and other information
necessary to ensure that all other information in the prospectus is at
least as current as the date of those financial statements. Notwithstanding
the foregoing, with respect to registration statements on Form F-3, a
post-effective amendment need not be filed to include financial statements
and information required by Section 10(a)(3) of the Act or Rule 3-19 of
Regulation S-X if such financial statements and information are contained
in periodic reports filed with or furnished to the Commission by the
registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Form F-3.
(5) That, for purposes of determining any liability under the Act,
each filing of the registrant's annual report pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(6) That, for purposes of determining any liability under the Act, the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(7) That, for the purposes of determining any liability under the Act,
each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the provisions described under Item 15 above, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-4
<PAGE> 59
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF STAMFORD AND STATE OF CONNECTICUT, ON THE 25TH DAY OF
AUGUST, 1997.
XEROX CORPORATION
(Registrant)
By: PAUL A. ALLAIRE*
----------------------------------
(Chairman of the Board and
Chief Executive Officer)
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON AUGUST 25, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- -------------------------------------- ----------------------------------------------------
<S> <C>
PRINCIPAL EXECUTIVE OFFICER:
PAUL A. ALLAIRE* Chairman of the Board, Chief Executive Officer and
Director
PRINCIPAL FINANCIAL OFFICER:
BARRY D. ROMERIL* Executive Vice President and Chief Financial Officer
CONTROLLER:
PHILIP D. FISHBACH* Vice President and Controller
</TABLE>
DIRECTORS:
B. R. INMAN
ANTONIA AX:SON JOHNSON
VERNON E. JORDAN, JR.
YOTARO KOBAYASHI
HILMAR KOPPER
RALPH S. LARSEN
JOHN D. MACOMBER
GEORGE J. MITCHELL
N. J. NICHOLAS, JR.
JOHN E. PEPPER
MARTHA R. SEGER
THOMAS C. THEOBALD
*By: MARTIN S. WAGNER
----------------------------
(Martin S. Wagner,
Attorney-in-fact)
II-5
<PAGE> 60
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF STAMFORD AND STATE OF CONNECTICUT, ON THE 25TH DAY OF
AUGUST, 1997.
XEROX OVERSEAS HOLDINGS PLC
(Registrant)
By: BERNARD D. FOURNIER*
----------------------------------
(Director)
By: PATRICK H. PONCHON*
----------------------------------
(Director)
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON AUGUST 25, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ----------------------- -----------------------------------
<S> <C> <C>
BERNARD D. FOURNIER* Director (Principal Executive Officer)
PATRICK H. PONCHON* Director (Principal Financial and Accounting Officer)
CHARLES P. GILLIAM* Director
RUSSELL Y. OKASAKO* Director
EUNICE M. FILTER* Director
DAVID N. MAW* Director
CAROLE SHEPHARD* Director
</TABLE>
*By: MARTIN S. WAGNER
(Martin S. Wagner,
Attorney-in-fact)
II-6
<PAGE> 61
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF STAMFORD AND STATE OF CONNECTICUT, ON THE 25TH DAY OF
AUGUST, 1997.
RANK XEROX CAPITAL (EUROPE) PLC
(Registrant)
By: B.D. FOURNIER*
----------------------------------
(Director)
By: P.H. PONCHON*
----------------------------------
(Director)
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON AUGUST 25, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- --------------------- -------------------------------------
<S> <C> <C>
B.D. FOURNIER* Director (Principal Executive Officer)
P.H. PONCHON* Director (Principal Financial and Accounting Officer)
D.N. MAW* Director
E.M. FILTER* Director
</TABLE>
*By: MARTIN S. WAGNER
(Martin S. Wagner,
Attorney-in-fact)
II-7
<PAGE> 62
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Xerox Corporation:
We consent to the use of our report incorporated herein by reference and to
the reference to our firm under the heading "Experts" in the Prospectus.
KPMG PEAT MARWICK LLP
Stamford, Connecticut
August 25, 1997
II-8
<PAGE> 63
EXHIBIT INDEX
<TABLE>
<S> <C>
(1)(a) -- Form of Underwriting Agreement, incorporated by reference to Exhibit
(1)(a) to the Company's Registration Statement on Form S-3, Registration
No. 33-44597.
(1)(b) -- Form of Selling Agency Agreement, incorporated by reference to Exhibit
(1)(b) to the Company's Current Report on Form 8-K dated March 10, 1992.
(4)(a) -- Form of Indenture, incorporated by reference to Exhibit (4)(a) to the
Company's Registration Statement on Form S-3, Registration No. 333-13179.
(4)(b) -- Form of Indenture.
(4)(c) -- Form of Debt Security, incorporated by reference to Exhibit 4(b) to the
Company's Registration Statement on Form S-3, Registration No. 33-7415.
The Form of Debt Security is hereby modified, effective as of August 25,
1997, by replacing all references to Bankers Trust Company with Citibank,
N.A. and changing the date of the indenture referred to therein to as of
August 25, 1997.
(4)(d) -- Form of Debt Security, incorporated by reference to Exhibit 4(c) to the
Company's Registration Statement on Form S-3, Registration No. 33-7415.
The Form of Debt Security is hereby modified, effective as of August 25,
1997, by replacing all references to Bankers Trust Company with Citibank,
N.A. and changing the date of the indenture referred to therein to as of
August 25, 1997.
(4)(e) -- Form of Debt Security, incorporated by reference to Exhibit (1) to the
Company's Registration Statement on Form 8-A dated December 1, 1986 for
its 8 1/8% Notes due 1996. The Form of Debt Security is hereby modified,
effective as of August 25, 1997, by replacing all references to Bankers
Trust Company with Citibank, N.A. and changing the date of the indenture
referred to therein to as of August 25, 1997.
(4)(f) -- Form of Debt Security, incorporated by reference to Exhibit 4(b) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(g) -- Form of Debt Security, incorporated by reference to Exhibit 4(c) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(h) -- Form of Debt Security, incorporated by reference to Exhibit 4(d) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(i) -- Form of Debt Security, incorporated by reference to Exhibit 4(e) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(j) -- Form of Debt Security, incorporated by reference to Exhibit 4(f) to the
Company's Registration Statement on Form S-3, Registration No. 2-78982.
(4)(k) -- Form of Debt Security, incorporated by reference to Exhibit (4)(k) to the
Company's Current Report on Form 8-K dated March 10, 1992.
(4)(l) -- Form of Debt Security, incorporated by reference to Exhibit (4)(k) to the
Company's Current Report on Form 8-K dated May 25, 1994.
(4)(m) -- Form of Debt Security, incorporated by reference to Exhibit (4)(l) to the
Company's Registration Statement on Form S-3, Registration No. 333-13179.
(4)(n) -- Additional Forms of Debt Securities Incorporated by reference to the
Company's subsequently filed reports on Form 8-K.
(4)(o) -- Amended and Restated Subscription Agreement between Rank Xerox Limited and
Xerox Capital.
(4)(p) -- Form of Amended and Restated Subscription Agreement among Rank Xerox
Limited, Xerox Overseas and Xerox Capital.
(5)(a) -- Opinion of Martin S. Wagner, Esq., as to legality of the Debt Securities
of the Company and the Guarantees and certain other legal matters.
(5)(b) -- Opinion of Carole Shephard, Esq., as to legality of Debt Securities of the
Subsidiary Issuers.
(5)(c) -- Opinion of Ivins, Phillips & Barker, Chartered, special U.S. tax counsel
to the Issuers, as to material U.S. tax consequences.
</TABLE>
<PAGE> 64
<TABLE>
<S> <C>
(12) -- Computation of Ratio of Earnings to Fixed Charges of the Company.
(23)(a) -- Consent of Independent Auditors (see page II-6).
(23)(b) -- Consent of Martin S. Wagner, Esq. (see Exhibit 5(a)).
(23)(c) -- Consent of Carole Shephard, Esq. (see Exhibit 5(b)).
(23)(d) -- Consent of Ivins, Phillips & Barker, Chartered, special U.S. tax counsel
to the Company (see Exhibit 5(c)).
(24)(a) -- Certified Resolution of the Board of Directors of the Company.
(24)(b) -- Certified Resolutions of the Boards of Directors of the Subsidiary
Issuers.
(24)(c) -- Power of Attorney of the Company.
(24)(d) -- Power of Attorney of Xerox Overseas.
(24)(e) -- Power of Attorney of Xerox Capital.
(25) -- Statement of Eligibility and Qualification under the Trust Indenture Act
of 1939 on Form T-1 of Citibank, N.A. to act as Trustee under the
Indenture.
</TABLE>
<PAGE> 1
Exhibit 4(b)
XEROX CORPORATION
XEROX OVERSEAS HOLDINGS PLC
RANK XEROX (CAPITAL) EUROPE PLC
and
CITIBANK, N.A.
Trustee
Indenture
Dated as of August , 1997
<PAGE> 2
i
TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
<TABLE>
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PAGE
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<S> <C>
SECTION 1.01. Definitions ................................... 1
"this Indenture" and certain other terms .................. 1
"Act" ..................................................... 2
"Affiliate" ............................................... 2
"Authenticating Agent" .................................... 2
"Authorized Newspaper" .................................... 2
"Board of Directors" ...................................... 2
"Board Resolution" ........................................ 2
"Business Day" ............................................ 3
"Commission" .............................................. 3
"Company" ................................................. 3
"Consolidated Net Worth" .................................. 3
"Coupon Security" ......................................... 3
"Debt" .................................................... 3
"Defaulted Interest" ...................................... 3
"Depositary" .............................................. 4
"Event of Default" ........................................ 4
"Exchange Act" ............................................ 4
"Federal Bankruptcy Code" ................................. 4
"Fully Registered Security" ............................... 4
"Global Security" ......................................... 4
"Guarantee" ............................................... 4
"Guarantor" ............................................... 4
"Holder" .................................................. 4
"Indenture" ............................................... 4
"Interest" ................................................ 4
"Interest Payment Date" ................................... 5
"Issuer" .................................................. 5
"Issuer Request" and "Issuer Order" ....................... 5
"Majority Shareholder" .................................... 5
"Maturity" ................................................ 5
"Mortgage" ................................................ 5
"Officers' Certificate" ................................... 5
"Opinion of Counsel" ...................................... 5
"Original Issue Discount Security" ........................ 5
"Original Subscription Agreement" ......................... 5
"Outstanding" ............................................. 5
"Paying Agent" ............................................ 6
"Person" .................................................. 6
"Place of Payment" ........................................ 6
"Predecessor Security" .................................... 6
"Principal Corporate Trust Office" ........................ 6
</TABLE>
<PAGE> 3
ii
<TABLE>
<CAPTION>
PAGE
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<S> <C>
"Redemption Date" ......................................... 6
"Redemption Price" ........................................ 7
"Registered Coupon Security" .............................. 7
"Registered Holder" ....................................... 7
"Registered" .............................................. 7
"Regular Record Date" ..................................... 7
"Repayment Date" .......................................... 7
"Repayment Price" ......................................... 7
"Responsible Officer" ..................................... 7
"Restricted Subsidiary" ................................... 7
"Securities" .............................................. 7
"Securitization" .......................................... 7
"Securityholder" .......................................... 7
"Security Register" ....................................... 7
"Security Registrar" ...................................... 8
"Special Record Date" ..................................... 8
"Stated Maturity" ......................................... 8
"Subscription Agreement" .................................. 8
"Subsidiary" .............................................. 8
"Trustee" ................................................. 8
"Trustee Indenture Act" or "TIA" .......................... 8
"Unregistered Security" ................................... 8
"Vice President" .......................................... 8
SECTION 1.02. Compliance Certificates and Opinions .......... 8
SECTION 1.03. Form of Documents Delivered to Trustee ........ 8
SECTION 1.04. Acts of Securityholders ....................... 9
SECTION 1.05. Notices, etc., to Trustee, Issuers and
Guarantor ..................................... 10
SECTION 1.06. Notices to Securityholders; Waiver ............ 10
SECTION 1.07. Effect of Headings and Table of Contents ...... 11
SECTION 1.08. Successors and Assigns ........................ 11
SECTION 1.09. Separability Clause ........................... 11
SECTION 1.10. Benefits of Indenture ......................... 11
SECTION 1.11. Legal Holidays ................................ 11
SECTION 1.12. Governing Law ................................. 12
SECTION 1.13. Submission to Jurisdiction; Appointment of
Agent for Service of Process .................. 12
SECTION 1.14. Trust Indenture Act ........................... 12
SECTION 1.15. Counterparts .................................. 12
SECTION 1.16. Securities Denominated in a Currency Other
Than United States Dollars .................... 12
ARTICLE TWO
SECURITY FORMS
SECTION 2.01. Forms Generally ............................... 13
SECTION 2.02. Forms of Securities ........................... 13
SECTION 2.03. Form of Trustee's Certificate or
Authentication ................................ 14
SECTION 2.04. Form of Notation of Guarantees ................ 14
</TABLE>
<PAGE> 4
iii
ARTICLE THREE
THE SECURITIES
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SECTION 3.01. Title and Terms ............................... 15
SECTION 3.02. Denominations ................................. 16
SECTION 3.03. Execution, Authentication, Delivery and
Dating ........................................ 16
SECTION 3.04. Temporary Securities .......................... 19
SECTION 3.05. Registration, Registration of Transfer and
Exchange ...................................... 20
SECTION 3.06. Mutilated, Destroyed, Lost and Stolen
Securities .................................... 22
SECTION 3.07. Payment of Interest; Interest Rights
Preserved ..................................... 23
SECTION 3.08. Persons Deemed Owners ......................... 24
SECTION 3.09. Cancellation .................................. 24
SECTION 3.10. Computation of Interest ....................... 25
SECTION 3.11. Compliance with Certain Laws and Regulations .. 25
ARTICLE FOUR
REDEMPTION OF SECURITIES
SECTION 4.01. Applicability of Article ...................... 25
SECTION 4.02. Election to Redeem; Notice to Trustee ......... 25
SECTION 4.03. Selection by Trustee of Securities to be
Redeemed ...................................... 25
SECTION 4.04. Notice of Redemption .......................... 26
SECTION 4.05. Deposit of Redemption Price ................... 27
SECTION 4.06. Securities Payable on Redemption Date ......... 27
SECTION 4.07. Securities Redeemed in Part ................... 27
SECTION 4.08. Provisions With Respect to any Sinking Funds .. 27
SECTION 4.09. Applicability of Early Repayment Provisions ... 28
SECTION 4.10. Repayment of Securities ....................... 28
SECTION 4.11. Exercise of Option ............................ 29
SECTION 4.12. When Securities Presented for Repayment
Become Due and Payable ........................ 29
SECTION 4.13. Securities Repaid in Part ..................... 29
ARTICLE FIVE
COVENANTS
SECTION 5.01. Payment of Principal, Premium and Interest;
Compliance with Terms ......................... 29
SECTION 5.02. Maintenance of Office or Agency ............... 30
SECTION 5.03. Money for Security Payments to be Held in
Trust ......................................... 30
SECTION 5.04. Statement as to Compliance .................... 31
SECTION 5.05. Corporate Existence ........................... 31
SECTION 5.06. Limitation on Liens ........................... 31
SECTION 5.07. Waiver of Covenants ........................... 33
</TABLE>
ARTICLE SIX
SECURITYHOLDERS' LISTS AND REPORTS BY
TRUSTEE, ISSUERS AND GUARANTOR
<PAGE> 5
<TABLE>
<CAPTION>
PAGE
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<S> <C>
SECTION 6.01. Issuers and Guarantor to Furnish Trustee
Names and Addresses of Securityholders ........ 33
iv
SECTION 6.02. Preservation of Information; Communications
to Securityholders ............................ 34
SECTION 6.03. Reports by Trustee ............................ 35
SECTION 6.04. Reports by Issuers and Guarantor .............. 35
ARTICLE SEVEN
REMEDIES
SECTION 7.01. Events of Default ............................. 35
SECTION 7.02. Acceleration of Maturity; Rescission and
Annulment ..................................... 36
SECTION 7.03. Collection of Indebtedness and Suits for
Enforcement by Trustee ........................ 37
SECTION 7.04. Trustee May File Proofs of Claim .............. 38
SECTION 7.05. Trustee May Enforce Claims Without Possession
of Securities ................................. 38
SECTION 7.06. Application of Money Collected ................ 38
SECTION 7.07. Limitation on Suits ........................... 39
SECTION 7.08. Restoration of Rights and Remedies ............ 39
SECTION 7.09. Rights and Remedies Cumulative ................ 39
SECTION 7.10. Delay or Omission Not Waiver .................. 39
SECTION 7.11. Control by Securityholders .................... 40
SECTION 7.12. Waiver of Past Defaults ....................... 40
SECTION 7.13. Waiver of Stay or Extension Laws .............. 40
SECTION 7.14. Original Subscription Agreement and
Subscription Agreement ........................ 41
ARTICLE EIGHT
THE TRUSTEE
SECTION 8.01. Certain Rights of Trustee ..................... 41
SECTION 8.02. Not Responsible for Recitals or Issuance of
Securities .................................... 42
SECTION 8.03. May Hold Securities ........................... 42
SECTION 8.04. Money Held in Trust ........................... 42
SECTION 8.05. Compensation and Reimbursement ................ 42
SECTION 8.06. Corporate Trustee Required; Eligibility ....... 43
SECTION 8.07. Resignation and Removal; Appointment of
Successor ..................................... 43
SECTION 8.08. Acceptance of Appointment by Successor ........ 44
SECTION 8.09. Merger, Conversion, Consolidation or
Succession to Business of Trustee ............. 45
SECTION 8.10. Appointment of Authenticating Agent ........... 45
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 9.01. Supplemental Indentures Without Consent of
Securityholders ............................... 46
SECTION 9.02. Supplemental Indentures With Consent of
Securityholders ............................... 47
</TABLE>
<PAGE> 6
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SECTION 9.03. Execution of Supplemental Indentures .......... 48
SECTION 9.04. Effect of Supplemental Indentures ............. 48
SECTION 9.05. Conformity with Trust Indenture Act ........... 48
SECTION 9.06. Reference in Securities to Supplemental
Indentures .................................... 48
v
ARTICLE TEN
CONSOLIDATION, MERGER, CONVEYANCE OR TRANSFER
SECTION 10.01. Company May Consolidate, etc., Only on
Certain Terms ................................ 48
SECTION 10.02. Subsidiary Issuers May Consolidate, etc.,
Only on Certain Terms ........................ 49
SECTION 10.03. Successor Corporation Substituted ............ 49
SECTION 10.04. Securities to be Secured in Certain Events ... 49
SECTION 10.05. Assumption by Company of Subsidiary Issuers'
Obligations .................................. 50
ARTICLE ELEVEN
SATISFACTION AND DISCHARGE
SECTION 11.01. Satisfaction and Discharge of Indenture ...... 50
SECTION 11.02. Application of Trust Money ................... 51
ARTICLE TWELVE
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
SECTION 12.01. Exemption from Individual Liability .......... 51
ARTICLE THIRTEEN
MEETINGS OF HOLDERS OF SECURITIES
SECTION 13.01. Purposes of Meetings ......................... 52
SECTION 13.02. Call of Meetings by Trustee .................. 52
SECTION 13.03. Call of Meetings by Issuers or
Securityholders .............................. 53
SECTION 13.04. Qualifications for Voting .................... 53
SECTION 13.05. Quorum; Adjourned Meetings ................... 53
SECTION 13.06. Regulations .................................. 54
SECTION 13.07. Voting Procedure ............................. 54
SECTION 13.08. Written Consent in Lieu of Meetings .......... 55
SECTION 13.09. No Delay of Rights by Meeting ................ 55
ARTICLE FOURTEEN
GUARANTEES OF SECURITIES OF SUBSIDIARY ISSUERS
SECTION 14.01 Guarantees .................................... 55
SECTION 14.02 Execution of Guarantees ....................... 56
TESTIMONIUM ..................................................... 57
SIGNATURES AND SEALS ............................................ 57
ACKNOWLEDGMENTS ................................................. 59
</TABLE>
<PAGE> 7
THIS INDENTURE is entered into as of August , 1997, among XEROX
CORPORATION, a corporation organized and existing under the laws of
the State of New York (hereinafter called the "Company" and, in its
capacity as the guarantor with respect to Securities (as hereinafter
defined) issued by any of the Subsidiary Issuers (as hereinafter
defined), the "Guarantor"), having its principal executive office at
800 Long Ridge Road, P.O. Box 1600, Stamford, Connecticut
06904-1600, XEROX OVERSEAS HOLDING PLC, a public limited company
organized under the laws of England and Wales (hereinafter called
"Xerox Overseas"), having its principal executive office at Parkway,
Marlow, Buckinghamshire, SL7 1YL, England, RANK XEROX CAPITAL
(EUROPE) PLC (hereinafter called "Xerox Capital", and collectively
with Xerox Overseas, the "Subsidiary Issuers", and each a
"Subsidiary Issuer"), having its principal executive office at
Parkway, Marlow, Buckinghamshire, SL7 1YL, England, and CITIBANK,
N.A., a national banking association (hereinafter called the
"Trustee"), having its Principal Corporate Trust Office on the date
hereof at 120 Wall Street, New York, New York 10043. The Company and
the Subsidiary Issuers, each in its capacity as an issuer of
Securities is herein referred to as an "Issuer", and collectively as
the "Issuers".
RECITALS
Each of the Issuers deems it necessary from time to time to issue its
unsecured debentures, notes, bonds or other evidences of indebtedness (including
instruments in global, temporary or definitive form), to be issued in one or
more series (hereinafter called the "Securities") as hereinafter set forth, and
to provide therefor each such Issuer has duly authorized the execution and
delivery of this Indenture.
All things necessary to make this Indenture a valid agreement of each of
the Issuers and the Guarantor, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities or any series thereof, as
follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions. For all purposes of this Indenture,
except as otherwise expressly provided or unless the context otherwise
requires:
(1) the term "this Indenture" means this instrument, as originally
executed or as it may from time to time be supplemented or amended by one or
more indentures supplemental hereto entered into pursuant to the applicable
provisions hereof, and shall include the terms of particular series of
Securities established as contemplated by Section 3.01;
<PAGE> 8
(2) all references in this instrument to designated "Articles",
"Sections" and other subdivisions are to be designated Articles, Sections and
other subdivisions of this Indenture. The words "herein", "hereof" and
"hereunder" and other words of similar import refer to this Indenture as a whole
and not to any particular Article, Section or other subdivision;
(3) the terms defined in this Article have the meanings assigned to
them in this Article, and include the plural as well as the singular;
(4) all references to the "applicable Issuer" are to the Issuer of the
Securities being described;
(5) all references to the "Guarantee" and the "Guarantor" are operative
only where a Subsidiary Issuer is, was or may become the Issuer of the relevant
series of Securities, and only with respect to such series of Securities.
(6) 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; and
(7) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles as
in effect on the date of computation.
"Act" when used with respect to any Securityholder, has the meaning
specified in Section 1.04.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise,
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 8.10 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Authorized Newspaper" means a newspaper of general circulation in the
relevant area, printed in the English language and customarily published on each
Business Day, whether or not published on Saturdays, Sundays or holidays.
Whenever successive weekly publications in an Authorized Newspaper are
authorized hereunder, they may be made (unless otherwise expressly provided
herein) on the same or different days of the week and in the same or different
Authorized Newspapers.
"Board of Directors", when used with reference to any of the Issuers or
the Guarantor, means the board of directors (or any duly authorized committee
thereof) of such Issuer or the Guarantor, as the case may be.
"Board Resolution", when used with reference to any of the Issuers or the
Guarantor, means a copy of a resolution certified by the Secretary or an
Assistant Secretary (or any person holding a similar office) of such Issuer or
2
<PAGE> 9
the Guarantor, as the case may be, to have been duly adopted by the Board of
Directors of such Issuer or the Guarantor, as the case may be, and to be in full
force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means each day which is neither a Saturday, Sunday or other
day on which banking institutions in The City of New York or the pertinent Place
of Payment are authorized or required by law or executive order to be closed,
except as otherwise provided with respect to a particular issue of Securities as
contemplated in Section 3.01.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or if at any time after the
execution and delivery of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties on such date.
"Company" means the Person named as the "Company" in the first paragraph of
this instrument until any successor Person shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
any such successor Person.
"Consolidated Net Worth" means, at any time, as to a given Person, the sum
of (a) the amounts appearing on the latest consolidated balance sheet of such
Person and its Subsidiaries, prepared in accordance with generally accepted
accounting principles consistently applied, as
(i) the par or stated value of all outstanding capital stock (including
preferred stock),
(ii) capital paid-in and earned surplus or earnings retained in the
business plus or minus cumulative translation adjustments,
(iii) any unappropriated surplus reserves,
(iv) any net unrealized appreciation of equity investments, and
(v) minorities' interests in equity of Subsidiaries;
less (b) treasury stock; plus (c) in the case of the Company, the sum of
$600,000,000.
"Coupon Security" means any Security authenticated and delivered with one
or more interest coupons appertaining thereto.
"Debt" means (i) indebtedness for borrowed money or for the deferred
purchase price of property or services (excluding trade accounts payable
incurred in the ordinary course with a maturity of not greater than 90 days),
(ii) obligations as lessee under leases which shall have been or should be, in
accordance with generally accepted accounting principles, recorded as capital
leases, (iii) obligations under direct or indirect guaranties in respect of, and
obligations (contingent or otherwise) to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clause (i) or (ii) above
(excluding, in the case of the Company, obligations of the Company from time to
time under (1) the Support Agreement dated as of November 1, 1980, between
3
<PAGE> 10
the Company and Xerox Credit Corporation, as amended from time to time, and (2)
the Support Agreement dated as of February 6, 1985, between Xerox Canada Inc.
and Xerox Canada Finance Inc., as amended from time to time), and (iv) the
amount of unfunded benefit liabilities as defined in Section 4001(a)(18) of
ERISA under plans covered by Title IV of ERISA.
"Defaulted Interest" has the meaning specified in Section 3.07.
"Depositary" means, with respect to the Securities of any series issuable
or issued, in whole or in part, in the form of a Global Security, the Person
designated as Depositary by the applicable Issuer pursuant to Section 3.01 until
a successor Depositary shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter "Depositary" shall mean or include
each Person who is then a Depositary hereunder, and if at any time there is more
than one such Person, "Depositary" as used with respect to the Securities of any
such series shall mean the Depositary with respect to the Securities of that
series.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute or statutes. Section and
Title references to ERISA are to ERISA, as in effect at the date of this
Indenture and any subsequent amendatory provision thereof.
"Event of Default" has the meaning specified in Section 7.01.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, and any successor statute or statutes.
"Federal Bankruptcy Code" means Title 11 of the United States Code entitled
"Bankruptcy", as amended from time to time, and any successor statute or
statutes.
"Fully Registered Security" means any Security registered as to principal
and interest, if any.
"Global Security" means a Security issued to evidence all or a part of any
series of Securities which is executed by the applicable Issuer and
authenticated by the Trustee and delivered to the Depositary or pursuant to the
Depositary's instructions, and which the Guarantor executed, as applicable, the
notation of any Guarantee pursuant to Article Fourteen, all in accordance with
this Indenture and pursuant to an Issuer Order, which shall be registered in the
name of the Depositary or its nominee and which shall represent the amount of
uncertificated Securities of such series as specified therein.
"Guarantee" means the irrevocable and unconditional guarantee by the
Guarantor of any Security of any series of any Subsidiary Issuer authenticated
and delivered (i) as contemplated by Section 3.01 and endorsed on such Security,
if specified in a Board Resolution of the Guarantor, or (ii) otherwise pursuant
to Article Fourteen.
"Guarantor" means the Person named as the "Guarantor" in the first
paragraph of this instrument until any successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Guarantor" shall mean any such successor Person.
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"Holder", when used with respect to any Security, means a Securityholder
and, when used with respect to any coupon, means the bearer thereof.
"Indenture" means this instrument as originally executed and 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 shall
include the terms of particular series of Securities established as contemplated
by Section 3.01.
"Interest", when used with respect to an Original Issue Discount Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity.
"Interest Payment Date", when used with respect to any series of
Securities, means the Stated Maturity of an installment of interest, if any, on
such Securities.
"Issuer" means (i) any of the Persons named as an "Issuer" in the first
paragraph of this instrument until any successor Person shall have become such
pursuant to the applicable provisions of this Indenture in respect of any such
Person, and thereafter "Issuer", in respect of such Person shall mean any such
successor Person, and (ii) when used with respect to Securities, shall mean the
Issuer of Securities of the relevant series.
"Issuer Request" and "Issuer Order" means, with respect to Securities of a
series, a written request or order signed in the name of the Issuer of such
Securities or the Guarantor, if applicable, by any one of such Issuer's or the
Guarantor's, if applicable, director, Chairman of the Board, President or a Vice
President, and any one of such Issuer's or the Guarantor's, if applicable,
Treasurer, an Assistant Treasurer, Controller, an Assistant Controller,
Secretary, or an Assistant Secretary, (or in each case by any persons holding
similar offices) and delivered to the Trustee or any other Person, as required
by this Indenture.
"Majority Shareholder" means Rank Xerox Limited, or, if the Subscription
Agreement shall then have been executed, either Rank Xerox Limited or Xerox
Overseas, according to which of them shall, at the time any demand is served in
accordance with the terms of the Subscription Agreement, be the majority
shareholder of Xerox Capital.
"Maturity", when used with respect to any Security, means the date on which
the principal of such Security becomes due and payable as therein or herein
provided, whether on a Repayment Date, at the Stated Maturity or by declaration
of acceleration, call for redemption or otherwise.
"Mortgage" has the meaning specified in Section 10.03
"Officers' Certificate" means, with respect to an Issuer or the Guarantor,
a certificate signed by any director, the Chairman of the Board, the President
or a Vice President (as hereinafter defined), and by the Treasurer, an Assistant
Treasurer, the Controller, an Assistant Controller, the Secretary or an
Assistant Secretary, of such Issuer or the Guarantor, as the case may be, and
delivered to the Trustee in accordance with Section 314 of the TIA, to the
extent applicable.
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"Opinion of Counsel" means a written opinion of counsel, who may (except as
otherwise expressly provided in this Indenture) be an employee of an Issuer or
the Guarantor, and who shall be reasonably satisfactory to the Trustee.
"Original Issue Discount Security" means any Security which provides for an
amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 7.02.
"Original Subscription Agreement" means the Amended and Restated
Subscription Agreement dated as of April 18, 1997 between Rank Xerox Limited and
Xerox Capital.
"Outstanding" when used with respect to Securities or Securities of any
series, means, as of the date of determination, all such Securities theretofore
authenticated and delivered under this Indenture, except:
(a) such Securities theretofore canceled by the Trustee or delivered
to the Trustee for cancellation;
(b) such Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the applicable Issuer or the Guarantor) in trust or set aside and
segregated in trust by the applicable Issuer or the Guarantor (if such Issuer or
the Guarantor shall be acting as its or their own Paying Agent) for the Holders
of such Securities, provided that, if such Securities are to be redeemed, notice
of such redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been made; and
(c) such Securities in exchange for or in lieu of which other Securities
have been authenticated and delivered pursuant to this Indenture;
provided, however, that in determining whether the Holders of the requisite
principal amount of such Securities Outstanding have given any request, demand,
authorization, direction, notice, consent or waiver hereunder (i) the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding shall be the amount of the principal thereof that would be due and
payable as of the date of such determination upon a declaration of acceleration
of the Maturity thereof pursuant to Section 7.02 and (ii) Securities owned by
any of the Issuers or the Guarantor or any other obligor upon the Securities or
any Affiliate of any of the Issuers or the Guarantor or such other obligor shall
be disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which the
Trustee knows to be so owned shall be disregarded. Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Securities and that the pledgee is not an Issuer or the
Guarantor or any other obligor upon the Securities or any Affiliate of an Issuer
or the Guarantor or such other obligor.
"Paying Agent" means any Person authorized by any Issuer to pay the
principal of, premium, if any, or interest, if any, on any Securities on behalf
of such Issuer.
"Person" means any individual, corporation (including a business trust),
partnership, joint venture, joint-stock company, trust, unincorporated
association or other entity, or the United States or a foreign state or a
political subdivision of either thereof or any agency of the United States or
such state or subdivision.
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"Place of Payment" means a city or any political subdivision thereof
designated as such in Section 3.01.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security, and for the purposes of this definition, any Security
authenticated and delivered under Section 3.06 in lieu of a lost, destroyed or
stolen Security shall be deemed to evidence the same debt as the lost, destroyed
or stolen Security.
"Principal 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 initial execution of
this Indenture, is 120 Wall Street, New York, New York 10043.
"Redemption Date", when used with respect to any Security to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be redeemed,
means the price specified in such Security at which it is to be redeemed
pursuant to this Indenture.
"Registered Coupon Security" means any Coupon Security registered as to
principal.
"Registered Holder", when used with respect to a Registered Security, means
the person in whose name such Security is registered in the Security Register.
"Registered Security" means any Security registered in the Security
Register.
"Regular Record Date" for the interest payable on any Security on any
Interest Payment Date means the date, if any, specified in such Security as the
"Regular Record Date".
"Repayment Date", when used with respect to any Security to be repaid,
means the date fixed for such repayment pursuant to such Security.
"Repayment Price", when used with respect to any Security to be repaid,
means the price at which it is to be repaid pursuant to such Security.
"Responsible Officer", when used with respect to the Trustee means any
officer within the Corporate Trust and Agency Group (or any successor group) of
the Trustee including any vice president, assistant vice president, assistant
secretary, or any other officer or assistant officer of the Trustee customarily
performing functions similar to those performed by the persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred at the Corporate Trust Office because of his or her knowledge or any
familiarity with the particular subject.
"Restricted Subsidiary" means any Subsidiary of the Company from time to
time having a Consolidated Net Worth of at least $100,000,000; provided,
however, that each of Xerox Financial Services, Inc., Xerox Credit Corporation
and any other corporation principally engaged in any business or businesses
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other than development, manufacture and/or marketing of (x) business equipment
(including, without limitation, reprographic, computer (including software) and
facsimile equipment), (y) merchandise or (z) services (other than financial
services) shall be excluded as a "Restricted Subsidiary" of the Company.
"Securities" has the meaning stated in the first recital of this Indenture
and shall mean any Securities authenticated and delivered pursuant to this
Indenture.
"Securitization" means, with respect to any Subsidiary Issuer, any
financing (whether or not by such Subsidiary Issuer, involving the transfer,
assignment or charging for fair value of lease, trade and/or finance receivables
and whether or not involving the issue of securities) where payments of
principal and interest thereunder are derived principally either directly or
after conversion through one or more interest rate and/or currency swap
agreements from moneys receivable (for a fair value) under or in connection with
such lease, trade and/or finance receivables and where the proceeds of such
financing are applied in repayment of debt and/or invested in assets.
"Securityholder" means a bearer of an Unregistered Security or a
Registered Holder of a Registered Security.
"Security Register" has the meaning specified in Section 3.05.
"Security Registrar" means the Person who keeps the Security Register
specified in Section 3.05.
"Special Record Date" for the payment of any Defaulted Interest (as defined
in Section 3.07) means the date fixed by the Trustee pursuant to Section 3.07.
"Stated Maturity", when used with respect to any Security, or any
installment of principal thereof or interest, if any, thereon, means the date
specified in such Security as the fixed date on which the principal of such
Security, or such installment of principal or interest, if any,, is due and
payable.
"Subscription Agreement" means the proposed Amended and Restated
Subscription Agreement expected to be among Rank Xerox Limited, Xerox Overseas
and Xerox Capital.
"Subsidiary" means, as to any Person, any corporation of which more than
50% of the outstanding capital stock having ordinary voting power to elect a
majority of the board of directors of such corporation (irrespective of whether
or not at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person, by such
Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939, as
amended by the Trust Indenture Reform Act of 1990, and as in force at the date
as of which this instrument was executed, except as provided in Section 9.05.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean and
include each Person who is then a Trustee hereunder. If at any time
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there is more than one such Person, "Trustee" as used with respect to the
Securities of any series shall mean the Trustee with respect to Securities of
that series.
"Unregistered Security" means any Coupon Security, or bearer Security,
not registered as to principal.
"Vice President", when used with respect to the Company or 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".
SECTION 1.02. Compliance Certificates and Opinions. Except as provided by
Section 5.04, any certificate required by this Indenture or the TIA to be
delivered by an Issuer or the Guarantor to the Trustee shall be signed by a
director, the Chairman of the Board, the President or a Vice President, and by
the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller,
the Secretary or an Assistant Secretary, of such Issuer or the Guarantor and be
in compliance with Section 314 of the TIA, to the extent applicable.
Any opinion of counsel required by this Indenture or the TIA to be
delivered by or on behalf of an Issuer or the Guarantor to the Trustee shall be
in compliance with Section 314 of the TIA, to the extent applicable, and be
provided by counsel to such Issuer or the Guarantor, who may (except as
otherwise expressly provided in this Indenture or in the TIA) be an employee of
any of the Issuers or the Guarantor, and who shall be reasonably satisfactory to
the Trustee.
SECTION 1.03. 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 a director or an officer of an Issuer or the
Guarantor may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such director
or officer knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the matters upon which
his certificate or opinion is based are erroneous. Any such certificate or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, a director or directors or
an officer or officers of an Issuer or the Guarantor stating that the
information with respect to such factual matters is in the possession of such
Issuer or the Guarantor, 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
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instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.04. Acts of Securityholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Securityholders of any series may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Securityholders in person or by an agent duly appointed in
writing or by the record of the holders of Securities voting in favor thereof at
any meeting of such Securityholders duly called and held in accordance with the
provisions of Article Thirteen; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
or any such record is delivered to the Trustee, and, where it is hereby
expressly required, to the applicable Issuer and the Guarantor. Such instrument
or instruments or such record (and the action embodied therein and evidenced
thereby) is herein sometimes referred to as the "Act" of the Securityholders
signing such instrument or instruments or voting at such meeting. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section 8.01)
conclusive in favor of the Trustee, such Issuer and the Guarantor, if made in
the manner provided in this Section. The record of any Securityholders' meeting
shall be proved in the manner provided in Section 13.07 and the record so proved
shall be sufficient for any purpose of this Indenture and (subject to Section
8.01) conclusive in favor of the Trustee, the applicable Issuer and the
Guarantor, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by
the certificate of any notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
or on behalf of any legal entity other than an individual, such certificate or
affidavit shall also constitute proof of the authority of the Person executing
the same. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which the Trustee deems sufficient.
(c) The ownership of Registered Securities shall be proved by the
Security Register.
(d) The amount of Unregistered Securities held by any Person executing any
such instrument or writing as a Securityholder, and the numbers of such
Unregistered Securities, and the date of his holding the same, may be proved by
the production of such Securities or by a certificate executed by any trust
company, bank, banker or member of a national securities exchange (wherever
situated), as depositary, if such certificate is in form satisfactory to the
Trustee, showing that at the date therein mentioned such Person had on deposit
with such depositary, or exhibited to it, the Unregistered Security therein
described; or such facts may be proved by the certificate or affidavit of the
Person executing such instrument or writing as a Securityholder, if such
certificate or affidavit is in a form satisfactory to the Trustee. The Trustee,
the applicable Issuer and the Guarantor may assume that such
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ownership of any Unregistered Security continues until (i) another certificate
bearing a later date issued in respect of the same Unregistered Security is
produced, or (ii) such Unregistered Security is produced by some other Person,
or (iii) such Unregistered Security is registered as to principal or is
surrendered in exchange for a Fully Registered Security, or (iv) such
Unregistered Security has been cancelled in accordance with Section 3.09.
(e) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Security shall bind the Holder of every
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof, in respect of any action taken, suffered or omitted
by the Trustee or the applicable Issuer or the Guarantor in reliance thereon,
whether or not notation of such action is made upon such Security.
(f) The applicable Issuer or the Guarantor may, but shall not be obligated
to, fix a record date for the purpose of determining the Holders entitled to
take any action under this Indenture by vote or consent. Such record date shall
be the later of 30 days prior to the first solicitation of such consent or vote
or the date of the most recent list of Holders furnished to the Trustee pursuant
to Section 6.01 prior to such solicitation. If a record date is fixed, those
Persons who were Holders of Securities at such record date (or their duly
designated proxies), and only those Persons, shall be entitled to take such
action by vote or consent or to revoke any vote or consent previously given,
whether or not such Persons continue to be Holders after such record date;
provided, however, that unless such vote or consent is obtained from the Holders
(or their designated proxies) of the requisite principal amount of Outstanding
Securities prior to the date which is the 120th day after such record date, any
such vote or consent previously given shall automatically and without further
action by any Holder be cancelled and of no further effect.
SECTION 1.05. Notices, etc., to Trustee, Issuers and Guarantor. Any
request, demand, authorization, direction, notice, consent, waiver or Act of
Securityholders 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 Securityholder or by an Issuer or the Guarantor
shall be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Principal Corporate Trust Office,
or
(2) an Issuer or the Guarantor by the Trustee or by any Securityholder
shall be sufficient for every purpose hereunder (except as provided in Section
7.01(4)) if in writing and mailed, first-class, postage prepaid, to such Issuer
or the Guarantor addressed to such party at the respective addresses of their
principal offices specified in the first paragraph of this Indenture or at any
other address previously furnished in writing to the Trustee by such Issuer or
the Guarantor.
SECTION 1.06. Notices to Securityholders; Waiver. Where this
Indenture or any Security provides for notice to Holders of any event, (1) if
any of the Securities affected by such event are Registered Securities, such
notice shall be sufficiently given (unless otherwise herein or in such
Securities expressly provided) if in writing and mailed, first-class, postage
prepaid, to each Registered Holder of
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such Securities, 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) if any of the Securities affected by such
event are Unregistered Securities, such notice shall be sufficiently given
(unless otherwise herein or in such Securities expressly provided) if published
once in an Authorized Newspaper in the Place of Payment or, if such Unregistered
Securities are listed on the Luxembourg Stock Exchange and if so requested by
such exchange, in Luxembourg, not later than the latest date, and not earlier
than the earliest date, prescribed for the giving of such notice. In any case
where notice to Securityholders is given by mail, neither the failure to mail
such notice, nor any defect in any notice so mailed, to any particular
Securityholder shall affect the sufficiency of such notice with respect to other
Securityholders. 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 Securityholders 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.
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
impossible to make publication of any notice in an Authorized Newspaper or
Authorized Newspapers as required by any Security or this Indenture, then such
method of publication or notification as shall be made with the approval of the
Trustee shall constitute a sufficient publication of such notice.
In case, by reason of the suspension of regular mail service as a result of
a strike, work stoppage or otherwise, it shall be impracticable to mail notice
of any event to the Holders of Securities when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Trustee, the applicable Issuer or
the Guarantor shall be deemed to be a sufficient giving of such notice.
SECTION 1.07. 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 1.08. Successors and Assigns. All covenants and agreements in this
Indenture by the Issuers or the Guarantor shall bind its successors and assigns,
whether so expressed or not.
SECTION 1.09. Separability Clause. In case any provision in this Indenture
or in the Securities shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
SECTION 1.10. Benefits of Indenture. Nothing in this Indenture or in the
Securities or in the Guarantees, express or implied, shall give to any Person,
other than the parties hereto and their successors hereunder, any Paying Agent,
the Security Registrar and the Holders, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 1.11. Legal Holidays. Except as may otherwise be provided with
respect to Securities of any series, in any case where the date of any Interest
Payment Date or Redemption Date or Repayment Date or the Maturity of any
Security or any date on which any Defaulted Interest is proposed to be paid or
the date on or by which any other action (including a date for giving notice) is
proposed or required to be taken shall not be a Business Day in a Place of
Payment, then payment of the principal of, premium, if any, or
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interest, if any, on any Securities may be made, and such action may be taken,
on the next succeeding Business Day with the same force and effect as if made on
the nominal date of any such Interest Payment Date or Redemption Date or
Repayment Date or Maturity or on the date on which Defaulted Interest is
proposed to be paid or taken or the nominal date on or by which such action is
proposed or required to be taken, as the case may be, and no interest shall
accrue on the payment so deferred for the period from and after any such nominal
date.
SECTION 1.12. GOVERNING LAW. THIS INDENTURE, THE SECURITIES AND THE
GUARANTEES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING TO
CONFLICTS OF LAW (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK, AND ANY SUCCESSOR STATUTE OR STATUTES); PROVIDED,
HOWEVER, THAT ALL MATTERS GOVERNING THE AUTHORIZATION AND EXECUTION OF THIS
INDENTURE AND THE SECURITIES BY EACH SUBSIDIARY ISSUER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE JURISDICTION OF ORGANIZATION OF
SUCH SUBSIDIARY ISSUER.
SECTION 1.13. Submission to Jurisdiction; Appointment of Agent for Service
of Process. Each Subsidiary Issuer submits for the exclusive benefit of the
Holders of its Securities to the non-exclusive jurisdiction of any United States
Federal or New York State court sitting in New York City, the Borough of
Manhattan solely for the purpose of any legal action or proceeding brought to
enforce rights under its Securities and this Indenture. As long as any of its
Securities remains Outstanding (unless all payments are then being made by the
Guarantor), each Subsidiary Issuer shall either have an authorized agent or
maintain an office in New York State upon whom process may be served in any such
legal action or proceeding. Service of process upon any Subsidiary Issuer at its
office or upon its agent with written notice of such service mailed or delivered
to such Subsidiary Issuer shall to the fullest extent permitted by applicable
law be deemed in every respect effective service of process upon such Subsidiary
Issuer in any such legal action or proceeding. Each Subsidiary Issuer hereby
appoints the Company, Xerox Square, 100 Clinton Avenue South, Rochester, New
York, 14644, U.S.A., Attention: General Counsel, as its agent in New York State
for such purpose, any the Company accepts such appointment. Each Subsidiary
Issuer covenants and agrees that service of process in any legal action or
proceeding may be made upon it at its office, or upon its agent in New York
State. Each Subsidiary Issuer irrevocably waives (and irrevocably agrees not to
raise) any objection which it may now have or hereafter to the laying of venue
of any such actions or proceedings in any such court referred to in this
paragraph and any claim that any such actions or proceedings have been brought
in an inconvenient forum and further irrevocably agrees that a judgment in any
action or proceeding brought in any court referred to in this paragraph shall be
conclusive and binding upon it and may be enforced in the courts of any other
jurisdiction.
SECTION 1.14 Trust Indenture Act. This Indenture is subject to the TIA and
if any provision hereof limits, qualifies or conflicts with the TIA, the TIA
shall control.
SECTION 1.15 Counterparts. This Indenture may be executed in any number of
counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
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SECTION 1.16 Securities Denominated in a Currency Other Than United States
Dollars. For the purposes of calculating the principal amount of Securities
denominated in a currency other than U.S. dollars (including units consisting of
multiple currencies) for any purpose under this Indenture the principal amount
of such Securities at any time Outstanding shall be deemed to be that amount of
U.S. dollars that could be obtained for such principal amount on the basis of
the spot rate of exchange for such currency into U.S.
dollars as of the date of any such calculation.
ARTICLE TWO
SECURITY FORMS
SECTION 2.01. Forms Generally. The Securities of each series and the
certificates of authentication thereon shall have such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
this Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon, as may be
required to comply with the rules of any securities exchange, or as may,
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of such Securities. Any portion of the text of
any Security may be set forth on the reverse thereof, with an appropriate
reference thereto on the face of the Security.
The definitive Securities, if any, shall be printed, lithographed or
engraved or produced by any combination of these methods on steel engraved
borders or otherwise or may be produced in any other manner as the applicable
Issuer may elect, to the extent, if such Securities are listed thereon,
permitted by the rules of any securities exchange, all as determined by the
officers executing such Securities, as evidenced by their execution of such
Securities.
SECTION 2.02. Forms of Securities. Each Security shall be in one of the
forms approved from time to time by or pursuant to a Board Resolution, or
established in one or more indentures supplemental hereto. Prior to the delivery
of a Security to the Trustee for authentication in any form approved by or
pursuant to a Board Resolution, the applicable Issuer shall deliver to the
Trustee the Board Resolution by or pursuant to which such form of Security has
been approved, which Board Resolution shall have attached thereto a true and
correct copy of the form of Security which has been approved by or pursuant
thereto, or, if a Board Resolution authorizes a specific officer or officers to
approve a form of Security, a certificate of such officer or officers approving
the form of Security attached thereto. Any form of Security approved by or
pursuant to a Board Resolution must be acceptable as to form to the Trustee,
such acceptance to be evidenced by a certificate signed by a Responsible Officer
of the Trustee and delivered to the applicable Issuer or by the execution by the
Trustee of the certificate of authentication thereon.
If any Security of a series is issuable as a Global Security (in whole or
in part), such Global Security may provide that it shall represent the aggregate
amount of Outstanding Securities 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 reduced to reflect exchanges or
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may from time to time be increased to reflect the issuance of additional
uncertificated Securities of such series. Any endorsement of a Global Security
to reflect the amount, or any increase or decrease in the amount, of Outstanding
Securities represented thereby shall be made by the Trustee pursuant to such
instructions and in such manner as shall be specified in such Global Security or
in or pursuant to the Issuer Order to be delivered to the Trustee pursuant to
Section 3.03.
If Article Fourteen is to be applicable to Securities of any series, the
Securities of each such series shall bear a notation of the Guarantees in
substantially the form set forth in Section 2.04. For any other series of
Securities, the Guarantees shall be endorsed on the Securities and shall be
substantially in the form established by or pursuant to a Board Resolution of
the Guarantor in accordance with Section 3.01 or one or more indentures
supplemental hereto. Notwithstanding the foregoing, the notation of the
Guarantees to be endorsed on the Securities of any series may have such
appropriate insertions, omissions, substitutions and other corrections from the
forms thereof referred to above as are required or permitted by this Indenture
and may have such letters, numbers or other marks of identification and such
legends or endorsements placed thereon as may be required to comply with the
rules of any securities exchange or as may, consistently herewith, be determined
by the officers delivering the same, in each case as evidenced by such delivery.
SECTION 2.03. Form of Trustees Certificate of Authentication. The Trustee's
certificate of authentication for any Security issued pursuant to this Indenture
shall be substantially in the following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities, of the series designated herein, described
in the within mentioned Indenture.
CITIBANK, N.A.,
AS TRUSTEE
Dated: By. . . . . . . . . . . . . . . . . .
Authorized Signatory
SECTION 2.04. Form of Notation of Guarantees. XEROX CORPORATION, a New York
corporation (the "Guarantor", which term includes any successor thereto under
the Indenture (the "Indenture") referred to in the Security on which this
notation is endorsed) has unconditionally guaranteed, pursuant to the terms of
the Guarantees contained in Article Fourteen of the Indenture, the due and
punctual payment of the principal of and any premium and interest on this
Security, when and as the same shall become due and payable, whether at the
Stated Maturity, by declaration of acceleration, call for redemption, early
repayment or otherwise, in accordance with the terms of this Security and the
Indenture.
The obligations of the Guarantor to the Holders of the Securities and to
the Trustee pursuant to the Guarantees and the Indenture are expressly set forth
in Article Fourteen of the Indenture, and reference is hereby made to such
Article and Indenture for the precise terms of the Guarantees.
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The Guarantees shall not be valid or obligatory for any purpose until the
certificate of authentication on the Security upon which this notation of the
Guarantees is endorsed shall have been executed by the Trustee under the
Indenture by the manual signature of one of its authorized signatories.
ARTICLE THREE
THE SECURITIES
SECTION 3.01. Title and Terms. The aggregate principal amount of Securities
which may be authenticated and delivered under this Indenture is unlimited. The
Securities may be issued up to the aggregate principal amount of Securities from
time to time authorized by or pursuant to Board Resolutions of the applicable
Issuer and the Guarantor.
The Securities may be issued in one or more series. All Securities of each
series issued under this Indenture shall in all respects be equally and ratably
entitled to the benefits hereof with respect to such series without preference,
priority or distinction on account of the actual time or times of the
authentication and delivery or Maturity of the Securities of such series. All
Securities of any one series need not be issued at the same time, and unless
otherwise provided, a series may be reopened for issuance of additional
Securities of such series up to the maximum aggregate principal amount
authorized at the time the series is reopened. There shall be established in or
pursuant to Board Resolutions of the applicable Issuer and the Guarantor, and
set forth in an Officers' Certificate, or established in one or more indentures
supplemental hereto, prior to the issuance of Securities of any series,
(1) the title of the Securities of the series (which shall distinguish the
Securities of the series from all other Securities);
(2) any limit upon the aggregate principal amount of the Securities of the
series which may be authenticated and delivered under this Indenture (except for
Securities authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Securities of that series pursuant to this
Article Three, Article Four or Article Nine);
(3) the date or dates or the periodic intervals on which the principal and
premium, if any, of the Securities of such series is payable, or the method of
determination thereof;
(4) the rate or rates (which may be fixed or variable), or the method of
determination thereof, at which the Securities of such series shall bear
interest, if any, which, if so provided in or pursuant to the authority granted
by the Board Resolutions of the applicable Issuer or the Guarantor with respect
to such series, may be determined by such Issuer or Guarantor from time to time
and set forth in the Securities of such series issued from time to time, the
date or dates from which such interest shall accrue, or the method of
determination thereof, the Interest Payment Dates on which such interest shall
be payable and the record dates, if any, for the determination of Holders to
whom interest is payable;
(5) the place or places where the principal of, and premium, if any, and
interest, if any, if other than as set forth in Section 3.01, on Securities of
such series shall be payable;
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(6) the price or prices at which, the period or periods within which and
the terms and conditions upon which Securities of such series may be redeemed,
in whole or in part, at the option of the applicable Issuer or pursuant to any
sinking fund or otherwise;
(7) the obligation, if any, of the applicable Issuer to redeem, purchase or
repay Securities of such series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof, and the price or prices at
which and the period or periods within which and the terms and conditions
upon which Securities of such series shall be redeemed, purchased or repaid, in
whole or in part, pursuant to such obligation;
(8) if other than denominations of $1,000 and integral multiples thereof,
the denominations in which Securities of such series shall be issuable;
(9) whether the Securities of the series shall be issued (a) as other than
Fully Registered Securities or (b) in whole or in part in the form of a Global
Security or Securities and, in such case, (i) the terms and conditions, if any,
upon which such Global Security or Securities may be exchanged in whole or in
part for other definitive Securities, (ii) the Depositary for such Global
Security or Securities and (iii) whether such Global Security shall be
definitive or temporary;
(10) if the Securities of such series will be entitled to the benefits of
the Guarantees afforded by Article Fourteen or, if not, the form of the
Guarantees to be endorsed on the Securities of such series;
(11) if other than the principal amount thereof, the portion of the
principal amount of an Original Issue Discount Security which shall be payable
upon declaration of acceleration of the maturity thereof pursuant to Section
7.02; and
(12) any and all other terms of such series, including denominations of
securities in currencies other than U.S. dollars (including units consisting of
multiple currencies) and including any election as to any optional provision,
which shall be necessary to complete the form of Security for such series, which
shall be one of the forms approved or established pursuant to Section 2.02
hereof (which terms shall not be inconsistent with the provisions of this
Indenture).
The principal of, premium, if any, and interest, if any, on the Securities
shall be payable at the office or agency of the applicable Issuer or the
Guarantor in the Borough of Manhattan, The City of New York, unless the form of
any such Security shall designate a different place of payment (any such office
or place of payment being herein called the "Place of Payment"); provided,
however, and unless otherwise provided in the form of Security for any series
approved or established pursuant to Section 2.02, that payment of interest, if
any, with respect to Registered Securities may be made at the option of the
applicable Issuer or the Guarantor by check mailed to the address of the person
entitled thereto as such address shall appear in the Security Register.
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SECTION 3.02. Denominations. The Securities of each series shall be
issuable in such form and denominations as shall be specified in the form of
Security for such series approved or established pursuant to Section 2.02 or in
the Officers' Certificate delivered pursuant to Section 3.01. In the absence of
any specification with respect to the Securities of any series, the Securities
of such series shall be issuable only as Fully Registered Securities without
coupons in denominations of $1,000 and any integral multiple thereof.
SECTION 3.03. Execution, Authentication, Delivery and Dating. The
Securities shall be executed on behalf of applicable Issuer and any Guarantees
to be endorsed on the Securities shall be executed on behalf of the Guarantor by
the Chairman of the Board, the President or one of the Vice Presidents and by
the Secretary or one of the Assistant Secretaries of such Issuer or the
Guarantor. Interest coupons appertaining to a Coupon Security shall be executed
on behalf of by its Chairman of the Board, its President or one of its Vice
Presidents. The signatures of any or all of these officers on the Securities and
the Guarantees, as the case may be, may be manual or facsimile.
The notation of any Guarantees endorsed on the Securities shall be executed as
provided in Section 2.04.
Securities and the Guarantees, as the case may be, bearing the manual or
facsimile signatures of individuals who were at any time the proper officers of
the applicable Issuer or the Guarantor shall bind such Issuer or the Guarantor,
as the case may be, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery of such
Securities or Guarantees or did not hold such offices at the date of such
Securities or Guarantees.
At any time and from time to time after the execution and delivery of this
Indenture, the applicable Issuer may deliver Securities of any series executed
by it bearing the notation of any Guarantees pursuant to Article Fourteen or
having any Guarantees endorsed thereon, as applicable, in each case, executed by
the Guarantor, to the Trustee for authentication together with an Issuer Order
for authentication and delivery of such Securities; and the Trustee in
accordance with such Issuer Order shall authenticate and deliver such Securities
as in this Indenture provided and not otherwise, without further action by such
Issuer. If all the Securities of any series are not to be issued at one time and
if the Board Resolution or supplemental indenture establishing such series shall
so permit, such Issuer Order may set forth procedures acceptable to the Trustee
for the issuance of such Securities and determining the terms of particular
Securities of such series such as interest rate, maturity date, date of issuance
and date from which interest, if any, shall accrue, in which case it shall not
be necessary to deliver additional Issuer Orders with respect to Securities of
the same series.
Prior to any such authentication and delivery, the Trustee shall be
entitled to receive and shall be fully protected in relying upon:
(1) the Opinion of Counsel to be furnished to the Trustee
pursuant to Section 314(c)(2) of the TIA with the Officers' Certificate
relating to the issuance of any series of Securities;
(2) a Board Resolution relating thereto, certified by the
Secretary or an Assistant Secretary of the applicable Issuer and the
Guarantor, as applicable;
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(3) an executed supplemental indenture, if any, relating
thereto; and
(4) an Opinion of Counsel which shall state
(a) all instruments furnished to the Trustee conform to
the requirements of this Indenture and constitute sufficient
authority hereunder for the Trustee to authenticate and deliver such
Securities;
(b) all laws and requirements with respect to the form and
execution by the applicable Issuer and, if applicable, the Guarantor
of the supplemental indenture, if any, have been complied with, such
Issuer and, if applicable, the Guarantor have corporate powers to
execute and deliver any such supplemental indenture and have taken all
necessary corporate actions for those purposes and any such
supplemental indenture has been duly executed and delivered by such
Issuer and, if applicable, the Guarantor and constitutes the legal,
valid and binding obligations of such Issuer and, if applicable, the
Guarantor, enforceable against such Issuer and, if applicable, the
Guarantor, in accordance with its terms (subject, as to enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws affecting creditors' rights generally from
time to time in effect and to general equity principles);
(c) the form and terms or the procedure for determining
the terms of such Securities have been established in conformity
with the provisions of this Indenture;
(d) subject to such conditions as may be set forth in said
Opinion of Counsel, all laws and requirements with respect to the
execution and delivery by the applicable Issuer of such Securities
and, if applicable, the Guarantees by the Guarantor, have been
complied with, such Issuer and, if applicable, the Guarantor have the
corporate power to issue such Securities and, if applicable, the
Guarantees, and such Securities and, if applicable, the Guarantees,
have been duly authorized by such Issuer and, if applicable, the
Guarantor and, assuming due execution by such Issuer and, if
applicable, the Guarantor and due authentication and delivery by the
Trustee, will constitute legal, valid and binding obligations of such
Issuer and, if applicable, the Guarantor enforceable in accordance
with their respective terms, subject to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting the enforcement of creditors' rights and to general equity
principles, and will be entitled to the benefits of this Indenture,
equally and ratably with all other Securities, if any, of such series
Outstanding;
(e) the amount of Securities Outstanding, including such
Securities, does not exceed the amount at the time permitted by law
or under the terms of this Indenture;
(f) the Indenture is qualified under the Trust Indenture
Act; and
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(g) subject to such conditions as may be set forth in said
Opinion of Counsel, the issuance of the Securities does not contravene
the charter or by-laws of the applicable Issuer or, if applicable, the
Guarantor and does not violate the terms or provisions of this
Indenture or of any indenture, mortgage or other agreement known to
such counsel to which such Issuer and, if applicable, the Guarantor is
a party.
If all the Securities of any series are not to be issued at one time, it
shall not be necessary to deliver the documents specified in (1), (2), (3) and
(4) immediately above at the time of issuance of each Security, but such
documents, with appropriate modifications, shall be delivered at or prior to the
time of issuance of the first Security of such series.
The Trustee shall not be required to authenticate such Securities if the
issue thereof will adversely affect the Trustee's own rights, duties or
immunities under the Securities, the Guarantees and this Indenture or otherwise
in a manner which is not reasonably acceptable to the Trustee. The Trustee shall
not be required to authenticate Securities denominated in a coin or currency
other than U.S. dollars if the Trustee reasonably determines that such
Securities impose duties or obligations on the Trustee which the Trustee is not
able or reasonably willing to accept.
Unless otherwise provided in the form of Security for any series, all
Securities shall be dated the date of their authentication.
Subject to Section 3.11, each Depositary designated pursuant to Section
3.01 or this Section 3.03 for a Global Security must, at the time of its
designation and at all times while it serves as Depositary, be a clearing agency
registered under the Exchange Act, or any other applicable statute or
regulation.
If at any time the Depositary for Global Securities of a series notifies
the applicable Issuer in writing that it is unwilling or unable to continue as
Depositary for the Global Securities of such series or if at any time the
Depositary for the Global Securities for such series shall no longer be eligible
under this Section 3.03 or in good standing under the Exchange Act, or other
applicable statute or regulation, such Issuer shall appoint a successor
Depositary with respect to the Securities for such series. If a successor
Depositary for the Securities of such series is not appointed by such Issuer
within 90 days after such Issuer receives such notice or becomes aware of such
ineligibility, such Issuer will execute, and the Guarantor will execute, as
applicable, the notation of any Guarantees pursuant to Article Fourteen or any
Guarantees endorsed on, and the Trustee, upon receipt of an Issuer Order for the
authentication and delivery of definitive Securities of such series, will
authenticate and deliver Securities of such series of like tenor and terms in
definitive form in an aggregate principal amount equal to the principal amount
of the Global Security or Securities representing such series in exchange for
such Global Security or Securities, having the notation of any Guarantees
pursuant to Article Fourteen or any Guarantees endorsed thereon.
The applicable Issuer may at any time and in its sole discretion determine
that the Securities of any series issued in the form of one or more
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Global Securities shall no longer be represented by such Global Security or
Securities. In such event, such Issuer will execute, and the Guarantor will
execute, as applicable, the notation of any Guarantees pursuant to Article
Fourteen or any Guarantees endorsed on, and the Trustee, upon receipt of an
Issuer Order for the authentication and delivery of definitive Securities of
such series, will authenticate and deliver Securities of such series of like
tenor and terms in definitive form in an aggregate principal amount equal to the
principal amount of the Global Security or Securities representing such series
in exchange for such Global Security or Securities, having the notation of any
Guarantees pursuant to Article Fourteen or any Guarantees endorsed thereon.
If specified by the applicable Issuer pursuant to Section 3.01 with respect
to a series of Securities, the Depositary for such series of Securities may
surrender a Global Security for such series of Securities in exchange in whole
or in part for Securities of such series of like tenor and terms in definitive
form on such terms as are acceptable to such Issuer, the Trustee and such
Depositary. Thereupon, the applicable Issuer shall execute, and the Guarantor
will execute, as applicable, the notation of any Guarantees pursuant to Article
Fourteen or any Guarantees endorsed on, and the Trustee, upon receipt of an
Issuer Order, shall authenticate and deliver without service charge to the
Holders, (i) to the Depositary or to each Person specified by such Depositary a
new Security or Securities of the same series, of like tenor and terms and of
any authorized denomination as requested by such person in an aggregate
principal amount equal to and in exchange for such Person's beneficial interest
in the Global Security, having the notation of any Guarantees pursuant to
Article Fourteen or any Guarantees endorsed thereon; and (ii) to such Depositary
a new Global Security of like tenor and terms and in a denomination equal to the
difference, if any, between the principal amount of the surrendered Global
Security and the aggregate principal amount of securities delivered pursuant to
clause (i) hereof, having the notation of any Guarantees pursuant to Article
Fourteen or any Guarantees endorsed thereon.
No Security or Guarantee shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose, unless there appears on
such Security a certificate of authentication substantially in the form provided
for herein executed by the Trustee by manual signature, and such certificate
upon any Security shall be conclusive evidence, and the only evidence, that such
Security or Guarantee has been duly authenticated and delivered hereunder.
SECTION 3.04. Temporary Securities. Pending the preparation of definitive
Securities of any series, the applicable Issuer may execute, and the Guarantor
may execute, as applicable, the notation of any Guarantees pursuant to Article
Fourteen or any Guarantees endorsed on, and upon receipt of the documents
required by Sections 3.01 and 3.03, together with an Issuer Order , the Trustee
shall authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denominations, substantially of the tenor of the definitive Securities in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities or
Guarantees or notations of the Guarantees pursuant to Article Fourteen, as
applicable, may
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determine, as conclusively evidenced by their execution of such Securities or
Guarantees or notations, as the case may be.
If temporary Securities of any series are issued, the applicable Issuer
will cause definitive Securities of such series to be prepared without
unreasonable delay. After the preparation of definitive Securities, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of such Issuer in the Place of Payment, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities the applicable Issuer shall execute, and the Guarantor
shall execute, as applicable, the notation of any Guarantees pursuant to Article
Fourteen or the Guarantees endorsed on, and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Securities of
such series of authorized denominations and of the same tenor. Until so
exchanged the temporary Securities of such series shall in all respects be
entitled to the same benefits under this Indenture as definitive Securities of
such series.
SECTION 3.05. Registration, Registration of Transfer and Exchange. Each of
the Issuers shall keep or cause to be kept a register (herein sometimes referred
to as the "Security Register") in which, subject to such reasonable regulations
as it may prescribe, such Issuer shall provide for the registration of each
series of Registered Securities and the registration of transfers of Registered
Securities of such series. Any such register shall be in written form or in any
other form capable of being converted into written form within a reasonable
time. At all reasonable times the information contained in such register or
registers shall be available for inspection by the Trustee at the office or
agency to be maintained by such Issuer as provided in Section 5.02.
Upon surrender for registration of transfer of any Registered Security of
any series at the office or agency of the applicable Issuer in the Place of
Payment or at the Principal Corporate Trust Office, such Issuer shall execute,
and the Guarantor shall execute, as applicable, the notation of any Guarantees
pursuant to Article Fourteen or the Guarantees endorsed on, and the Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Registered Securities of such series of any
authorized denominations and of a like tenor, aggregate principal amount and
Stated Maturity and the notation of any Guarantees pursuant to Article Fourteen
or the Guarantees endorsed thereon.
Notwithstanding any other provision of this Section 3.05, unless and until
it is exchanged in whole or in part for Securities in a definitive form, a
Global Security representing all or a portion of the Securities of a series, and
the notation of any Guarantees pursuant to Article Fourteen or the Guarantees
endorsed thereon, may not be transferred except as a whole by the Depositary of
such series to a nominee of such Depositary or by a nominee of such Depositary
to such Depositary or another nominee of such Depositary or by such Depositary
or any such nominee to a successor Depositary of such series or a nominee of
such successor Depositary, and any such Global Security shall contain a legend
to the following effect: "Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to Issuer or its agent for registration of transfer, exchange, or payment, and
any certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of DTC (and any payment is
made to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS
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WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein."
Upon the exchange of a Global Security for Securities in definitive form,
such Global Security shall be cancelled by the Trustee. Definitive Securities
issued in exchange for a Global Security pursuant to Section 3.03 shall be
registered in such names and in such authorized denominations and delivered to
the Depositary or to such addresses as the Depositary for such Global Security,
pursuant to instructions from its direct or indirect participants or otherwise,
shall instruct the Trustee in writing. The Trustee shall deliver such Securities
to the Depositary or to the persons in whose names such Securities are so
registered.
At the option of the Holder, Registered Securities of any series may be
exchanged for other Registered Securities of such series, of any authorized
denominations and of a like tenor, aggregate principal amount and Stated
Maturity and the notation of any Guarantees pursuant to Article Fourteen or the
Guarantees endorsed on, upon surrender of the Registered Securities to be
exchanged at the office or agency of the applicable Issuer in the Place of
Payment or at the Principal Corporate Trust Office. Whenever any Registered
Securities are so surrendered for exchange, the applicable Issuer shall execute,
and the Guarantor shall execute, as applicable, the notation of any Guarantees
pursuant to Article Fourteen or the Guarantees endorsed on, and the Trustee
shall authenticate and deliver, the Registered Securities which the
Securityholder making the exchange is entitled to receive.
Upon presentation for registration of any Unregistered Security of any
series which by its terms is registrable as to principal at the office or agency
of the applicable Issuer in the Place of Payment or at the Principal Corporate
Trust Office, such Security shall be registered as to principal in the name of
the Holder thereof and such registration shall be noted on such Security. Any
Security so registered shall be transferable on the Security Register, upon
presentation of such Security at such office or agency for similar notation
thereon, but such Security may, to the extent and under the circumstances
specified pursuant to Section 3.11, be discharged from registration by being in
like manner transferred to bearer, whereupon transferability by delivery shall
be restored. Unregistered Securities shall continue to be subject to successive
registrations and discharges from registration at the option of the Holders
thereof.
Coupon Securities shall be transferable by delivery except while registered
as to principal. Registration of any Coupon Security shall not affect the
transferability by delivery of the coupons appertaining thereto, which shall
continue to be payable to bearer and transferable by delivery.
At the option of the Holder thereof, Coupon Securities of any series which
by their terms are registrable as to principal and interest may be exchanged for
Fully Registered Securities of such series of any authorized denominations and
of a like aggregate principal amount and Stated Maturity and with the notation
of any Guarantees pursuant to Article Fourteen or the Guarantees endorsed
thereon, upon surrender of the Coupon Securities to be exchanged at such office
or agency with all unmatured coupons and all matured coupons in default thereto
appertaining, and upon payment, if the applicable Issuer shall so require, of
the charges hereinafter provided. At the option of the Holder thereof and to the
extent and under the circumstances specified pursuant to Section 3.11, Fully
Registered Securities of any series, which by
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their terms provide for the issuance of Coupon Securities, may be exchanged for
Coupon Securities or Fully Registered Securities of such series, of any
authorized denominations and of a like tenor, aggregate principal amount and
Stated Maturity and with the notation of any Guarantees pursuant to Article
Fourteen or the Guarantees endorsed thereon, upon surrender of the Securities to
be exchanged at such office or agency, and upon payment if shall so require of
the charges hereinafter provided. Whenever any Securities are so surrendered for
exchange, the applicable Issuer shall execute, and the Trustee shall
authenticate and deliver, the Securities which the Holder making the exchange is
entitled to receive.
All Securities and any Guarantees issued upon any registration of transfer
or exchange of Securities shall be the valid obligations of the applicable
Issuer and the Guarantor, respectively, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Securities surrendered upon
such registration of transfer or exchange and any Guarantees thereof.
Every Registered Security presented or surrendered for registration of
transfer, exchange, redemption or repayment shall (if so required by the
applicable Issuer or the Trustee) be duly endorsed, or be accompanied by a
written instrument of transfer in form satisfactory to such Issuer and the
Trustee duly executed, by the Holder thereof or his attorney duly authorized in
writing.
Unless otherwise provided in the Securities to be transferred or exchanged,
no service charge shall be made for any registration of transfer or exchange of
Securities, but the applicable Issuer may (unless otherwise provided in such
Securities) require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Securities, other than exchanges pursuant to Section
3.04, 4.07, or 9.06 not involving any transfer.
The applicable Issuer shall not be required (i) to issue, register the
transfer of or exchange any Securities of any series during a period beginning
at the opening of business 15 days before the day of selection of Securities of
such series to be redeemed under Section 4.03 and ending at the close of
business on the day of the mailing of a notice of redemption of Securities of
such series so selected for redemption, or (ii) to register the transfer or
exchange of any Securities so selected for redemption in whole or that part of
any Security so selected in the case of Securities selected for redemption in
part.
SECTION 3.06. Mutilated, Destroyed, Lost and Stolen Securities. If (i) any
mutilated Security or any Security to which a mutilated coupon is annexed is
surrendered to the Trustee, or if the applicable Issuer, the Guarantor and the
Trustee receive evidence to their satisfaction of the destruction, loss or theft
of any Security or any coupon appurtenant to a Coupon Security, and (ii) there
is delivered to the applicable Issuer, the Guarantor, the Trustee and the
Security Registrar such security or indemnity as may be required by them to save
each of them harmless, then, in the absence of notice to such Issuer and the
Trustee that such Security or coupon has been acquired by a bona fide purchaser,
such Issuer shall execute, and the Guarantor shall execute, as applicable, the
notation of any Guarantees pursuant to Article Fourteen or the Guarantees
endorsed on, and upon such Issuer's request the Trustee shall authenticate and
deliver, in exchange for
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or in lieu of any such mutilated, destroyed, lost or stolen Security or the
Coupon Security to which such mutilated, destroyed, lost or stolen coupon
appertains, a new Security of the same series and of like tenor and principal
amount, having the notation of any Guarantees pursuant to Article Fourteen or
the Guarantees endorsed thereon, as applicable, and bearing a number not
contemporaneously Outstanding.
In case any such mutilated, destroyed, lost or stolen Security or coupon
has become or is about to become due and payable, the applicable Issuer or the
Guarantor, each in its own discretion, may, instead of issuing a new Security,
pay such Security or coupon.
Upon the issuance of any new Security under this Section, the applicable
Issuer or the Guarantor, as the case may be, 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 (and appurtenant coupon) issued pursuant to this Section
in lieu of any destroyed, lost or stolen Security or coupon, and any Guarantees
thereof, shall constitute an original additional contractual obligation of the
applicable Issuer and the Guarantor, whether or not the destroyed, lost or
stolen Security or 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 and coupons and Guarantees of the same series
duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities or coupons.
SECTION 3.07. Payment of Interest; Interest Rights Preserved. Interest on
any Fully Registered Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall unless otherwise provided in
such Security be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered on the Regular Record Date for such
interest. Subject to the penultimate paragraph of this Section, interest on any
Unregistered Security which is payable, and is punctually paid or duly provided
for, on any Interest Payment Date shall be paid to the Holder of such
Unregistered Security, or the coupon appertaining thereto, as the case may be.
Any interest on any Fully Registered Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
of such Fully Registered Security, on the relevant Regular Record Date by virtue
of his having been such Holder, and such Defaulted Interest shall be paid by the
applicable Issuer or the Guarantor, at its election in each case, as provided
in Clause (1) or Clause (2) below:
(1) The applicable Issuer or the Guarantor may elect to make payments
of any Defaulted Interest to the Persons in whose names any such Fully
Registered Securities (or their respective Predecessor Securities) are
registered at the close of business on a Special Record Date for the
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payment of such Defaulted Interest, which shall be fixed in the following
manner. Such Issuer or the Guarantor shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Fully
Registered Security and the date of the proposed payment, and at the same
time such Issuer or the Guarantor shall deposit with the Trustee an amount
of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this Clause provided. Thereupon
the Trustee shall fix a Special Record Date for the payment of such
Defaulted Interest which shall be not more than 15 nor 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 such Issuer or the Guarantor of such Special
Record Date and, in the name and at the expense of such Issuer or the
Guarantor, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be mailed, first-class,
postage prepaid, to each Fully Registered Holder 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 such Issuer or the Guarantor, notify Fully Registered
Holders by causing a similar notice to be published at least once in an
Authorized Newspaper in the Place of Payment, 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 Persons in whose names such Fully
Registered Securities (or their respective Predecessor Securities) are
registered on such Special Record Date and shall no longer be payable
pursuant to the following Clause (2).
(2) The applicable Issuer or the Guarantor may make payment of any
Defaulted Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of that
series may be listed, and upon such notice as may be required by such
exchange, if, after notice given by such Issuer or the Guarantor to the
Trustee of the proposed payment pursuant to this Clause; such payment shall
be deemed practicable by the Trustee.
Any Defaulted Interest payable in respect of any Security which is not a
Fully Registered Security shall be payable pursuant to such procedures as may be
satisfactory to the Trustee in such manner that there is no discrimination as
between the Holders of Fully Registered Securities and other Securities of the
same series, and notice of the payment date therefor shall be given by the
Trustee, in the name and at the expense of such Issuer or the Guarantor, by
publication at least once in any Authorized Newspaper in the Place of Payment,
subject to Section 1.06.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of, or in exchange
for, or in lieu of, any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
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SECTION 3.08. Persons Deemed Owners. Prior to and at the time of due
presentment for registration of transfer of any Registered Security, the
applicable Issuer, the Guarantor, the Trustee and any agent of such Issuer, the
Guarantor or the Trustee may treat the Person in whose name such Registered
Security is registered as the owner of such Registered Security for the purpose
of receiving payment of principal of, premium, if any, on, and, if such
Registered Security is a Fully Registered Security (subject to Section 3.07)
interest, if any, on, such Registered Security, and for all purposes whatsoever
(except the payment of coupons appertaining to any Registered Coupon Security
and the payment of interest, if any, payable on presentation of any temporary
Security), whether or not such Registered Security be overdue, and neither such
Issuer, the Guarantor, the Trustee nor any agent of such Issuer, the Guarantor
or the Trustee shall be affected by notice to the contrary. The applicable
Issuer, the Guarantor, the Trustee and any agent of such Issuer, the Guarantor
or the Trustee may treat the Holder of any Unregistered Security or the Holder
of any coupon, whether or not the Security to which such coupon appertains be
registered, as the owner of such Unregistered Security or coupon for the purpose
of receiving payment thereof and for all other purposes whatsoever, whether or
not such Unregistered Security or coupon be overdue, and neither such Issuer,
the Guarantor, the Trustee nor any agent of such Issuer, the Guarantor or the
Trustee shall be affected by notice to the contrary.
None of Issuers, the Guarantor, 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 and they shall be
protected in acting or refraining from acting on any such information provided
by the Depositary.
SECTION 3.09. Cancellation. All Securities surrendered for payment,
registration of transfer, exchange, repayment or redemption, and all coupons
surrendered for payment, shall, if surrendered to any Person other than the
Trustee, be delivered to the Trustee, and any such Securities and coupons, and
Securities and coupons surrendered directly to the Trustee for any such purpose,
shall be promptly canceled by it. Any Issuer or the Guarantor may at any time
deliver to the Trustee for cancellation any Securities previously authenticated
and delivered hereunder which such Issuer or the Guarantor may have acquired in
any manner whatsoever, and all Securities so delivered shall be promptly
cancelled by the Trustee. No Securities shall be authenticated in lieu of or in
exchange for any Securities canceled as provided in this Section, except as
expressly permitted by this Indenture or such Securities. All canceled
Securities and coupons held by the Trustee shall be disposed of in accordance
with its standard procedures and the Trustee shall furnish to the applicable
Issuer and the Guarantor a certificate of disposition or, at the written request
of such Issuer and the Guarantor, the Trustee shall deliver such cancelled
Securities to the applicable Issuer or the Guarantor. If the applicable Issuer
or the Guarantor shall acquire any of the Securities, however, such acquisition
shall not operate as a redemption or satisfaction of the indebtedness
represented by such Securities unless and until the same are surrendered to the
Trustee for cancellation.
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SECTION 3.10. Computation of Interest. Except as otherwise specified in the
form of Security for any series approved or established pursuant to Section 2.02
or in the Officers' Certificate delivered pursuant to Section 3.01 with respect
to Securities of any series, interest, if any, on the Securities of each series
shall be computed on the basis of a 360-day year of twelve 30-day months.
SECTION 3.11. Compliance with Certain Laws and Regulations. If any
Unregistered Securities are to be issued in any series of Securities, the
applicable Issuer and the Guarantor will provide for arrangements and procedures
reasonably designed pursuant to then applicable laws and regulations, if any, to
ensure that Unregistered Securities are sold or resold (in connection with their
original issuance), exchanged, transferred and paid only in compliance with such
laws and regulations and without adverse consequences to such Issuer or the
Guarantor.
ARTICLE FOUR
REDEMPTION AND REPAYMENT OF SECURITIES
SECTION 4.01. Applicability of Article. Any of the Issuers may reserve the
right to redeem and pay before Stated Maturity all or any part of the Securities
of any series of such Issuer, either by optional redemption, sinking fund or
otherwise, by provision therefor in the form of Security for such series
approved or established pursuant to Section 2.02 and on such terms as are
specified in such form or the Officers' Certificate delivered pursuant to
Section 3.01 or the indenture supplemental hereto as provided in Section 3.01
with respect to Securities of such series. Redemption of Securities of any
series shall be made in accordance with the terms of such Securities and, to the
extent that this Article does not conflict with such terms, in accordance with
this Article.
SECTION 4.02. Election to Redeem; Notice to Trustee. The election of an
Issuer to redeem any Securities of such Issuer redeemable at the option of such
Issuer shall be evidenced by a Board Resolution of such Issuer and/or by an
Officers' Certificate made pursuant to a Board Resolution of such Issuer. In the
case of any redemption at the election of an Issuer of less than all the
Securities of any series of such Issuer, such Issuer shall notify the Trustee of
such Redemption Date and of the principal amount of Securities of such series to
be redeemed not less than 45 nor more than 60 days prior to the Redemption Date
(unless a shorter notice shall be satisfactory to the Trustee).
SECTION 4.03. Selection by Trustee of Securities to be Redeemed. To the
extent that the Securities of a given series have different terms, the
applicable Issuer in its sole and absolute discretion shall select the
Securities to be redeemed if less than all of the series are to be redeemed. If
less than all the Securities of a given series having the same terms are to be
redeemed, the particular Securities to be redeemed shall be selected not less
than 35 nor more than 45 days prior to the Redemption Date by the Trustee from
the Outstanding Securities of such series having such terms not previously
called for redemption, pro rata or by lot or by such method as the Trustee shall
deem fair and appropriate (so long as such method is not prohibited by the rules
of any stock exchange on which the Securities of such series may be then listed)
and which may provide for the selection for redemption of portions of the
principal of Securities
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of such series of a denomination larger than the minimum authorized denomination
for Securities of such series. Unless otherwise provided by the terms of the
Securities of any series so selected for partial redemption, the portions of the
principal of Securities of such series so selected for partial redemption shall
be equal to $1,000 or an integral multiple thereof and the principal amount
which remains outstanding shall not be less than the minimum authorized
denomination for Securities of such series.
If less than all of the Securities of a given series having different terms
are to be redeemed, the applicable Issuer shall notify the Trustee of the
Securities to be redeemed not less than 45 nor more than 60 days prior to the
Redemption Date (unless a shorter notice shall be satisfactory to the Trustee.
If less than all the Securities of a series having the same terms are to be
redeemed, the Trustee shall promptly notify the applicable Issuer in writing of
the Securities selected for redemption and, in the case of any Security 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 Security redeemed or to be redeemed only in part, to the portion of
the principal of such Security which has been or is to be redeemed. The Trustee
shall notify the applicable Issuer promptly of the Securities or portions of
Securities to be redeemed.
SECTION 4.04. Notice of Redemption. Notice of redemption shall be given in
the manner provided in Section 1.06, not less than 30 nor more than 60 days
prior to the Redemption Date, to each Holder of Securities to be redeemed at his
address appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) the CUSIP number; provided, that such notice shall state to the
effect that no representation is made as to the correctness of any such CUSIP
number, either as printed on the Security or as contained in any such notice,
and that reliance may be placed only on the other identification numbers printed
on the Securities and any redemption shall not be affected by any defect in or
omission of such numbers,
(4) the name and address of the Paying Agent,
(5) if less than all Outstanding Securities of any series are to be
redeemed, the identification (and, in the case of partial redemption, the
respective principal amounts) of the Securities to be redeemed,
(6) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security or portion thereof, and that interest, if
any, thereon shall cease to accrue on and after said date,
(7) the place where such Securities and all coupons, if any, are to be
surrendered for payment of the Redemption Price, which shall be the office or
agency of the applicable Issuer in the Place of Payment,
(8) that the redemption is on account of a sinking fund, if that be
the case.
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Notice of redemption of Securities to be redeemed at the election of any of
the Issuers shall be given by the applicable Issuer or, at such Issuer's
request, by the Trustee in the name and at the expense of such Issuer.
SECTION 4.05. Deposit of Redemption Price. On or prior to any Redemption
Date, but, in any event, not later than (i) 12:00 noon New York City time on the
applicable Redemption Date for Securities payable only in the United States, or
(ii) the close of business on the Business Day prior to the applicable
Redemption Date for Securities with a Place of Payment outside the United
States, the applicable Issuer shall deposit with the Trustee or with a Paying
Agent in immediately available funds (or, if such Issuer is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 5.03) an amount
of money sufficient to pay the Redemption Price of, which shall include any
premium, if any, and interest, if any, payable on, all the Securities which are
to be redeemed on that date.
SECTION 4.06. Securities Payable on Redemption Date. Notice of redemption
having been given as aforesaid, the Securities so to be redeemed shall, on the
Redemption Date, become due and payable at the Redemption Price therein
specified and on such date (unless the applicable Issuer shall default in the
payment of the Redemption Price) such Securities shall cease to bear interest.
Upon surrender of such Securities for redemption in accordance with said notice,
such Securities shall be paid by the applicable Issuer at the Redemption Price.
In the case of Fully Registered Securities, unless otherwise provided in such
Securities, installments of interest, if any, whose Stated Maturity is on or
prior to the Redemption Date shall be payable to the Holders of such Fully
Registered Securities registered as such on the relevant Regular Record Dates
according to their terms and the provisions of Section 3.07.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal shall, until paid, bear interest from the
Redemption Date at the rate borne by such Security, or as otherwise provided in
such Security.
SECTION 4.07. Securities Redeemed in Part. Any Security which is to be
redeemed only in part shall be surrendered at the office or agency of the
applicable Issuer in the Place of Payment (with, if the applicable Issuer or the
Trustee so requires, due endorsement by, or a written instrument of transfer in
form satisfactory to such Issuer and the Trustee duly executed by, the Holder of
any Registered Security or his attorney duly authorized in writing) and the
applicable Issuer shall execute, the Guarantor shall execute the notation of the
Guarantees pursuant to Article Fourteen or the Guarantees endorsed on, and the
Trustee shall authenticate and deliver to the Holder of such Security without
service charge, a new Security or Securities of the same series, tenor and
Stated Maturity of any authorized denominations 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.
SECTION 4.08. Provisions with Respect to any Sinking Funds. If the form or
terms of any series of Securities shall provide that, in lieu of making all or
any part of any mandatory sinking fund payment with respect to such series of
Securities in cash, the applicable Issuer may at its option (1) deliver to the
Trustee for cancellation any Securities of such series theretofore acquired by
such Issuer, or (2) receive credit for any Securities
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of such series (not previously so credited) acquired by such Issuer and
theretofore delivered to the Trustee for cancellation or redeemed other than
through the mandatory sinking fund, then (i) Securities so delivered, redeemed
or credited shall be credited at the applicable sinking fund Redemption Price
with respect to Securities of such series, and (ii) on or before the 60th day
next preceding each sinking fund Redemption Date with respect to such series of
Securities, such Issuer will deliver to the Trustee (A) an Officers' Certificate
specifying the portions of such sinking fund payment to be satisfied by payment
of cash and by the delivery or credit of Securities of such series acquired or
so redeemed by such Issuer, and (B) any Securities to be so delivered, to the
extent not previously surrendered. Such Officers' Certificate shall also state
that the Securities for which such Issuer elects to receive credit have not been
previously so credited and were not acquired by such Issuer through operation of
the mandatory sinking fund, if any, provided with respect to such Securities or
are required to be delivered to the Trustee pursuant to Section 3.09 and shall
also state that no Event of Default with respect to Securities of such series
has occurred and is continuing. All Securities so delivered to the Trustee shall
be canceled by the Trustee and no Securities shall be authenticated in lieu
thereof.
If the sinking fund payment or payments (mandatory or optional) with
respect to any series of Securities made in cash plus any unused balance of any
preceding sinking fund payments with respect to Securities of such series made
in cash shall exceed $50,000 (or a lesser sum if the applicable Issuer shall so
request), unless otherwise provided by the terms of such series of Securities,
said cash shall be applied by the Trustee on the sinking fund Redemption Date
with respect to Securities of such series next following the date of such
payment to the redemption of Securities of such series at the applicable sinking
fund Redemption Price with respect to Securities of such series, together with
accrued interest, if any, to the date fixed for redemption, with the effect
provided in Section 4.06. The Trustee shall select, in the manner provided in
Section 4.03, for redemption on such sinking fund Redemption Date a sufficient
principal amount of Securities of such series to utilize said cash and shall
thereupon cause notice of redemption of the Securities of such series for the
sinking fund to be given in the manner provided in Section 4.04 (and with the
effect provided in Section 4.06) for the redemption of Securities in part at the
option of the applicable Issuer. Any sinking fund moneys not so applied or
allocated by the Trustee to the redemption of Securities of such series shall be
added to the next cash sinking fund payment with respect to Securities of such
series received by the Trustee and, together with such payment, shall be applied
in accordance with the provisions of this Section 4.08. Any and all sinking fund
moneys with respect to Securities of any series held by the Trustee at the
Maturity of Securities of such series, and not held for the payment or
redemption of particular Securities of such series, shall be applied by the
Trustee, together with other moneys, if necessary, to be deposited sufficient
for the purpose, to the payment of the principal of the Securities of such
series at Maturity.
On or before each sinking fund Redemption Date provided with respect to
Securities of any series, the applicable Issuer shall pay to the Trustee in cash
a sum equal to all accrued interest, if any, to the date fixed for redemption on
Securities to be redeemed on such sinking fund Redemption Date pursuant to this
Section 4.08.
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SECTION 4.09. Applicability of Early Repayment Provisions. Repayment of
Securities of any series of any Issuer before their Stated Maturity at the
option of Holders thereof shall be made in accordance with the terms of such
Securities and (except as otherwise specified as contemplated by Section 3.01
for Securities of any series) in accordance with this Section and Sections 4.10,
4.11, 4.12 and 4.13.
SECTION 4.10. Repayment of Securities. Securities of any series of any
Issuer subject to repayment in whole or in part at the option of the Holders
thereof will, unless otherwise provided in the terms of such Securities, be
repaid at a price equal to the principal amount thereof, together with interest,
if any, thereon accrued to the Repayment Date specified in the terms of such
Securities. On or before the Repayment Date, the applicable Issuer will deposit
with the Trustee or with a Paying Agent (or, if such Issuer is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 5.03) an amount
of money sufficient to pay the Repayment Price of all the Securities which are
to be repaid on such date.
SECTION 4.11. Exercise of Option. Unless otherwise provided in the terms of
such Securities, to be repaid at the option of the Holder, (a) in the case of
any definitive Security so providing for such repayment, such Security, together
with the "Option to Elect Repayment" form on the reverse thereof duly completed
by the Holder, or (b) in the case of any Global Security so providing for such
repayment, such notice or notices as may be set forth therein, must be received
by the Trustee or any other Person designated by the applicable Issuer at the
Place of Payment therefor specified in the terms of such Security (or at such
other place or places of which such Issuer shall from time to time notify the
Holders of such Securities) not earlier than 30 days nor later than 15 days
(unless a shorter notice shall be satisfactory to the Trustee) prior to the
Repayment Date. If less than the entire principal amount of such Security is to
be repaid in accordance with the terms of such Security, the principal amount of
such Security to be repaid, in increments of $1,000 unless otherwise specified
in the terms of such Security, and the denomination or denominations of the
Security or Securities to be issued to the Holder for the portion of the
principal amount of such Security surrendered that is not to be repaid must be
specified. The principal amount of any Security providing for repayment at the
option of the Holder thereof may not be repaid in part, if, following such
repayment, the unpaid principal amount of such Security would be less than the
minimum authorized denomination of Securities of the series of which such
Security to be repaid is a part. Except as otherwise may be provided by the
terms of any Security providing for repayment at the option of the Holder
thereof, exercise of the repayment option by the Holder shall be irrevocable
unless waived by the applicable Issuer.
SECTION 4.12. When Securities Presented for Repayment Become Due and
Payable. If Securities of any series of any Issuer providing for repayment at
the option of the Holders thereof shall have been surrendered as provided in
Section 4.11 and as provided by the terms of such Securities, such Securities or
the portions thereof, as the case may be, to be repaid shall become due and
payable and shall be paid by such Issuer on the Repayment Date therein
specified, and on and after such Repayment Date (unless such Issuer shall
default in the payment of such Securities on such Repayment Date) interest, if
any, on such Securities or the portions thereof, as the case may be, shall cease
to accrue.
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SECTION 4.13. Securities Repaid in Part. Upon surrender of any Security
which is to be repaid in part only, the applicable Issuer shall execute, the
Guarantor shall execute the notation of the Guarantees pursuant to Article
Fourteen or the Guarantees endorsed on, and the Trustee shall authenticate and
deliver to the Holder of such Security, without service charge and at the
expense of such Issuer, a new Security or Securities of the same series and
Stated Maturity, of any authorized denomination specified by the Holder, in an
aggregate principal amount equal to and in exchange for the portion of the
principal of such Security so surrendered which is not to be repaid.
ARTICLE FIVE
COVENANTS
SECTION 5.01. Payment of Principal, Premium and Interest; Compliance with
Terms. Each of the Issuers covenants and agrees for the benefit of the Holders
of each series of Securities of such Issuer that it will duly and punctually pay
the principal of, premium, if any, and interest, if any, on the Securities of
such series in accordance with the terms of the Securities of such series and
this Indenture, and will duly comply with all the other terms, agreements and
conditions contained in, or made in the Indenture for the benefit of, the
Securities of such series.
SECTION 5.02. Maintenance of Office or Agency. Each of the Issuers will
maintain an office or agency in each Place of Payment where Securities of such
Issuer may be presented or surrendered for payment, where Registered Securities
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon such Issuer in respect of the Securities and this
Indenture may be served. Each applicable Issuer will give prompt written notice
to the Trustee of the location, and of any change in the location, of such
office or agency. If at any time any Issuer shall fail to maintain any such
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
Principal Corporate Trust Office of the Trustee, and each of the Issuers hereby
appoints the Trustee its agent to receive all such presentations, surrenders,
notices and demands.
The Guarantor will maintain an office or agency in each Place of Payment
where Securities to which the Guarantees apply where such Securities may be
presented or surrendered for payment pursuant to the Guarantees and where
notices and demands to or upon the Guarantor in respect of the Guarantees and
this Indenture may be served. The Guarantor 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 Guarantor shall fail to maintain any such office or
agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders and demands may be made or served at the Principal
Corporate Trust Office of the Trustee, and the Guarantor hereby appoints the
Trustee as its agent to receive all such presentations, surrenders and demands.
SECTION 5.03. Money for Security Payments to Be Held in Trust. If any of
the Issuers or the Guarantor shall at any time act as its own Paying Agent for
any series of Securities, it will, subject to Section 4.05, on or before each
due date of the principal of, premium, if any, or interest, if
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any, on any of the Securities of such series, segregate and hold in trust for
the benefit of the Persons entitled thereto a sum sufficient to pay the
principal, premium or interest so becoming due until such sums shall be paid to
such Persons or otherwise disposed of as herein provided, and will promptly
notify the Trustee of its action or failure so to act.
Whenever any of the Issuers or the Guarantor shall have one or more Paying
Agents for any series of Securities, it will, subject to Section 4.05, on or
prior to each due date of the principal of, premium, if any, or interest, if
any, on any Securities of such series, deposit with a Paying Agent a sum
sufficient to pay the principal, premium or interest so becoming due, such sum
to be held in trust for the benefit of the Persons entitled to such principal,
premium or interest, and (unless such Paying Agent is the Trustee) the
applicable Issuer will promptly notify the Trustee of its action or failure so
to act.
The applicable Issuer will cause each Paying Agent other than the Trustee
for any series of Securities to execute and deliver to the Trustee an instrument
in which such Paying Agent shall agree with the Trustee subject to the
provisions of this Section, that such Paying Agent will
(1) hold all sums held by it for the payment of principal of, premium,
if any, or interest, if any, on 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 herein provided;
(2) give the Trustee notice of any default by the applicable Issuer
(or any other obligor upon the Securities of such series) in the making of
any payment of principal, premium, if any, or interest, if any, on 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.
Any of the Issuers 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 applicable Issuer or such Paying Agent, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held by such
Issuer or such Paying Agent; and, upon such payment by such Issuer or such
Paying Agent to the Trustee, such Issuer or such Paying Agent shall be released
from all further liability with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held by
any of the Issuers or the Guarantor, in trust for the payment of the principal,
premium, if any, or interest, if any, on any Security of any series and
remaining unclaimed for two years after such principal, premium, if any, or
interest, if any, has become due and payable shall be paid to the applicable
Issuer or the Guarantor on Issuer Request, or (if then held by such Issuer or
the Guarantor) shall be discharged from such trust; and the Holder of such
Security shall thereafter, as an unsecured general creditor, look only to the
applicable Issuer or the Guarantor for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust
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money, and all liability of such Issuer or the Guarantor 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
applicable Issuer or the Guarantor cause to be mailed to the Holder at the
Holder's last known address or published once, in an Authorized Newspaper in the
Place of Payment, 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 mailing or publication, any unclaimed balance of such money then remaining
will be repaid to such Issuer or the Guarantor.
SECTION 5.04. Statement as to Compliance. The Company will deliver to the
Trustee, within 120 days after the end of each fiscal year of the Company, a
certificate of the principal executive officer, principal financial officer or
principal accounting officer of the Company stating that
(1) a review of the activities of the Company and the Subsidiary
Issuers during such year and of performance under this Indenture and under
the terms of the Securities has been made under his supervision and
(2) to the best of his knowledge, based on such review, the Company
and the Subsidiary Issuers has complied with all conditions and covenants
under this Indenture and under the terms of the Securities throughout such
year, or, if there has been a default in compliance with such conditions
and covenants, specifying each such default known to him and the nature and
status thereof.
For purposes of this Section 5.04, such compliance shall be determined
without regard to any period of grace or requirement of notice provided under
this Indenture.
SECTION 5.05. Corporate Existence. Subject to Article Ten, each of the
Issuers and the Guarantor will do, or cause to be done, all things necessary to
preserve and keep in full force and effect its corporate existence.
SECTION 5.06. Limitation on Liens. So long as any of the Securities any of
the Issuers shall be Outstanding, the Company will not create or suffer to
exist, or permit any of its Restricted Subsidiaries to create or suffer to
exist, any lien, security interest or other charge or encumbrance, or any other
type of preferential arrangement, upon or with respect to any of its properties
(other than any "margin stock" as that term is defined in Regulation U issued by
the Board of Governors of the Federal Reserve System), whether now owned or
hereafter acquired, or assign, or permit any of its Restricted Subsidiaries to
assign, any right to receive income, in each case to secure any Debt of any
Person without making effective provision whereby all of the Securities of each
series (together with, if the Company shall so determine, any other Debt of the
Company or such Restricted Subsidiary then existing or thereafter created which
is not subordinate to the Securities of each series) shall be equally and
ratably secured with the indebtedness or obligations secured by such security;
provided, however, that the Company or its Restricted Subsidiaries may create or
suffer to exist any lien, security interest, charge, encumbrance or preferential
arrangement of any kind in, of or upon any of the properties or assets of the
Company or its Restricted Subsidiaries to secure any Debt or Debts in an
aggregate amount at any time outstanding not greater than 20% of the
Consolidated Net Worth of the
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Company; and provided, further, that the foregoing restrictions shall not apply
to any of the following:
(i) deposits, liens or pledges to enable the Company or any Restricted
Subsidiary to exercise any privilege or license or to secure payments of
workers' compensation or unemployment insurance, or to secure the performance of
bids, tenders, contracts (other than for the payment of money) or statutory
landlords' liens under leases to which the Company or any such Restricted
Subsidiary is a party or to secure public or statutory obligations of the
Company or any such Restricted Subsidiary or to secure surety, stay or appeal
bonds to which the Company or any such Restricted Subsidiary is a party, but as
to all of the foregoing only if the same shall arise and continue in the
ordinary course of business or other similar deposits or pledges made and
continued in the ordinary course of business;
(ii) liens imposed by law, such as mechanic's, materialmen's, workman's,
repairman's or carrier's liens but only if arising, and only so long as
continuing, in the ordinary course of business or other similar liens arising
and continuing in the ordinary course of business or deposits or pledges in the
ordinary course of business to obtain the release of such liens;
(iii) liens arising out of judgments or awards against the Company or any
Restricted Subsidiary in an aggregate amount not to exceed the greater of (a)
15% of the Consolidated Net Worth of the Company or (b) the minimum amount
which, if subtracted from such Consolidated Net Worth would reduce such
Consolidated Net Worth below $3.2 billion, and in each case with respect to
which the Company or any such Restricted Subsidiary shall in good faith be
prosecuting an appeal or proceeding for review or liens incurred by the Company
or any such Restricted Subsidiary for the purpose of obtaining a stay or
discharge in the course of any legal proceedings to which the Company or any
such Restricted Subsidiary is a party;
(iv) liens for taxes if such taxes shall not at the time be delinquent or
thereafter can be paid without penalty, or are being contested in good faith and
by appropriate proceedings, or minor survey exceptions or minor encumbrances,
easements or reservations of or rights of others for rights of way, sewers,
electric lines, telegraph and telephone lines and other similar purposes or
zoning or other restrictions as to the use of real properties which
encumbrances, easements, reservations, rights and restrictions do not in the
aggregate materially detract from the value of the said properties or materially
impair their use in the operation of the business of the Company or any
Restricted Subsidiary owning the same;
(v) liens in favor of any government or any department or agency thereof or
in favor of a prime contractor under a government contract and resulting from
the acceptance of progress or partial payments under government contracts or
sub-contracts thereunder;
(vi) liens, security interests, charges, encumbrances, preferential
arrangements and assignments of income in existence on the date hereof;
(vii) purchase money liens or purchase money security interests upon or in
any property acquired or held by the Company or any Restricted Subsidiary
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in the ordinary course of business to secure the purchase price of such property
or to secure indebtedness incurred solely for the purpose of financing the
acquisition of such property;
(viii) liens or security interests existing on property at the time of
its acquisition;
(ix) the rights of Xerox Credit Corporation relating to the reserve account
established pursuant to the Operating Agreement, dated as of November 1, 1980,
between the Company and Xerox Credit Corporation, as such Operating Agreement is
amended from time to time;
(x) the replacement, extension or renewal of any lien, security interest,
charge or encumbrance, preferential arrangement or assignment of income
permitted by clauses (i) through (ix) above upon or in the same property
theretofore subject thereto or the replacement, extension or renewal (without
increase of principal amount) of the indebtedness secured thereby; and
(xi) liens on any assets of any Restricted Subsidiary of up to $500,000,000
which may be incurred in connection with the sale or assignment of assets of
such Restricted Subsidiary for cash where the proceeds are applied to repayment
of Debt of such Restricted Subsidiary and/or invested by such Restricted
Subsidiary in assets which would be reflected as receivables on the such
Restricted Subsidiary's balance sheet in accordance with generally accepted
accounting principles.
SECTION 5.07. Waiver of Covenants. Any of the Issuers and the Guarantor may
omit, in respect of any series of Securities of such Issuer, in any particular
instance to comply with any covenant or condition set forth in Section 5.06
hereof, if before or after the time for such compliance the Holders of a
majority in aggregate principal amount of the Securities at the time Outstanding
of such series shall, by Act of such Holders, either waive such compliance in
such instance or generally waive compliance with such covenant or condition, but
no such waiver shall extend to or affect such covenant or condition except to
the extent so expressly waived, and, until such waiver shall become effective,
the obligations of such Issuer and the Guarantor and the duties of the Trustee
in respect of any such covenant or condition shall remain in full force and
effect.
ARTICLE SIX
SECURITYHOLDERS' LISTS AND REPORTS BY TRUSTEE, ISSUERS AND GUARANTOR
SECTION 6.01. Issuers and Guarantor to Furnish Trustee Names and Addresses
of Securityholders. Each of the Issuers and the Guarantor will furnish or cause
to be furnished to the Trustee (a) semiannually, not more than 15 days after
each [August] 1 and [February] 1, commencing [February 1, 1998], a list, in such
form as the Trustee may reasonably require, containing all the information in
the possession or control of such Issuer and the Guarantor, or any of its Paying
Agents other than the Trustee, as to the names and addresses of the Holders of
Securities of each series of such Issuer as of such [August 1] or [February 1],
as the case may be, and (b) at such other times as the Trustee may request in
writing, within 30 days after receipt by the applicable Issuer and the Guarantor
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 and all of the Securities of
any series of the
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applicable Issuer are Registered Securities, no such list shall be required to
be furnished by such Issuer or the Guarantor in respect of such series, but in
any event such Issuer and the Guarantor shall be required to furnish such
information concerning the Holders of Unregistered Securities which is known to
such Issuer and the Guarantor; provided, however, that neither such Issuer nor
the Guarantor shall have any obligation to investigate any matter relating to
any Holder of an Unregistered Security.
SECTION 6.02. Preservation of Information; Communications to
Securityholders. (a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information furnished to it or received by it in
its capacity of Security Registrar pursuant to Section 6.01.
(b) If three or more Holders of Securities of any series (hereinafter
referred to as "applicants") apply in writing to the Trustee, accompanied by
reasonable proof that each such applicant has owned a Security of such series
for a period of at least six months preceding the date of such application and
by a copy of the form of proxy or other communication which such applicants
propose to transmit, and such application states that the applicants desire to
communicate with other Holders of Securities of such series or with the Holders
of all Securities with respect to their rights under this Indenture or under
such Securities and the Guarantees, then the Trustee shall, within five Business
Days after receipt of the application, at its election, either (i) afford such
applicants access to the information preserved at the time by the Trustee in
accordance with Section 6.02(a), or (ii) inform such applicants as to the
approximate number of Holders of Securities of such series or all Securities, as
the case may be, whose names and addresses appear in the information preserved
at the time by the Trustee in accordance with Section 6.02(a), and as to the
approximate cost of mailing to such Holders the form of proxy or other
communication, if any, specified in such application.
If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon the written request of such applicants,
mail to each Holder of a Security of such series or to all Holders, as the case
may be, whose names and addresses appear in the information preserved at the
time by the Trustee in accordance with Section 6.02(a), a copy of the form of
proxy or other communication which is specified in such request, with reasonable
promptness after a tender to the Trustee of the material to be mailed and of
payment, or provision for the payment, of the reasonable expenses of mailing,
unless within five days after such tender, the Trustee shall mail to such
applicants and file with the Commission, together with a copy of the material to
be mailed, a written statement to the effect that, in the opinion of the
Trustee, such mailing would be contrary to the best interests of the Holders of
Securities of such series or all Holders, as the case may be, or would be in
violation of applicable law. Such written statement shall specify the basis of
such opinion. If the Commission, after opportunity for a hearing upon the
objections specified in the written statement so filed, shall enter an order
refusing to sustain any of such objections or if, after the entry of an order
sustaining one or more of such objections, the Commission shall find, after
notice and opportunity for hearing, that all the objections so sustained have
been met and shall enter an order so declaring, the Trustee shall mail copies of
such material to all Holders of such series or all Holders , as the case may be,
with reasonable promptness after the entry of such order and the renewal of such
tender; otherwise, the Trustee shall be relieved of any obligation or duty to
such applicants with respect to their application.
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(c) Every Holder of Securities, by receiving and holding the same, agrees
with each of the Issuers, the Guarantor and the Trustee that none of the
Issuers, the Guarantor and the Trustee shall be held accountable by reason of
the disclosure of any such information as to the names and address of the
Holders of Securities in accordance with Section 6.02(b), 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 6.02(b).
SECTION 6.03. Reports by Trustee. Within 60 days after each [August] 15,
commencing [August] 15, 1998, the Trustee shall transmit to Securityholders a
report as provided in Section 313(a) of the TIA if so required by such Section.
SECTION 6.04. Reports by Issuers and Guarantor. Each of the Issuers and the
Guarantor will
(a) file with the Trustee, within 30 days after such Issuer and the
Guarantor 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 such Issuer and the Guarantor may be
required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act; or, if the such Issuer and the Guarantor is not required to file
information, documents and reports pursuant to either of said Sections, then it
will 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 or 15(d) 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;
(b) 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 such Issuer and
the Guarantor with the conditions and covenants of this Indenture as may be
required from time to time such rules and regulations; and
(c) mail or cause to be mailed to all Securityholders, in the manner and to
the extent provided in Section 313(c) of the TIA, such summaries of any
information, documents and reports required to be filed by such Issuer and the
Guarantor pursuant to clauses (a) and (b) of this Section as may be required by
rules and regulations prescribed from time to time by the Commission.
ARTICLE SEVEN
REMEDIES
SECTION 7.01. Events of Default. "Event of Default", with respect to any
series of Securities of an Issuer or any Guarantees thereof, wherever used
herein, means each 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
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governmental body), unless it is either inapplicable to a particular series or
it is specifically deleted or modified in the supplemental indenture under which
such series of Securities is issued or in the form of Security for such series:
(1) default in the payment of any interest upon any Security of such series
when the same becomes due and payable, and continuance of such default for a
period of 30 days; or
(2) default in the payment of the principal of or premium, if any, on any
Security of such series at its Maturity; or
(3) default in the making or satisfaction of any sinking fund payment or
analogous obligation when the same becomes due by the terms of the Securities of
such series; or
(4) default in the performance, or breach, of any covenant or warranty of
such Issuer or the Guarantor in respect of the Securities of such series (other
than a covenant or warranty in respect of the Securities of such series a
default in whose performance or whose breach is elsewhere in this Section
specifically dealt with), and continuance of such default or breach for a period
of 90 days after there has been given, by registered or certified mail, to such
Issuer and the Guarantor by the Trustee or to such Issuer, the Guarantor 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 of a decree by a court having jurisdiction in the premises
adjudging the applicable Issuer or the Guarantor bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization, arrangement,
adjustment or composition of or in respect of such Issuer or the Guarantor under
the Federal Bankruptcy Code or any other applicable Federal or State law or
equivalent legislation in the jurisdiction of incorporation of such Issuer, if
not the United States, or appointing a receiver, liquidator, assignee, trustee,
sequestrator or other similar official of such Issuer or the Guarantor or of any
substantial part of its property, or ordering the winding-up or liquidation of
its affairs, and the continuance of any such decree or order unstayed and in
effect for a period of 60 consecutive days; or
(6) the institution by the applicable Issuer or the Guarantor of
proceedings to be adjudicated a bankrupt or insolvent or the consent by such
Issuer or the Guarantor to the institution of bankruptcy or insolvency
proceedings against such Issuer or the Guarantor, or the filing by such Issuer
or the Guarantor of a petition or answer or consent seeking reorganization or
relief under the Federal Bankruptcy Code or any other applicable Federal or
State law or equivalent legislation in the jurisdiction of incorporation of such
Issuer, if not the United States, or the consent by such Issuer or the Guarantor
to the filing of any such petition or to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator or other similar official of such
Issuer or the Guarantor or of any substantial part of its property, or the
making by such Issuer or the Guarantor of an assignment for the benefit of
creditors, or the admission by such Issuer or the Guarantor in writing of its
inability to pay its debts generally as they become due, or the
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taking of corporate action by such Issuer or the Guarantor in furtherance of any
such action; or
(7) any other Event of Default provided in the supplemental indenture under
which such series of Securities is issued or in the form of Security for such
series.
SECTION 7.02. Acceleration of Maturity; Rescission and Annulment. If an
Event of Default with respect to any series of Securities of any Issuer for
which there are Securities Outstanding occurs and is continuing, then, and in
every such case, the Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities of such series of such Issuer (each such
series acting as a separate class) may declare the principal (or, if the
Securities of such series are Original Issue Discount Securities, such portion
of the principal amount as may be specified in the terms of the Securities of
such series of such Issuer) of all the Securities of such series of such Issuer
to be immediately due and payable, by a notice in writing to such Issuer and the
Guarantor (and to the Trustee if given by Securityholders), and upon any such
declaration the same shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of such series, by written notice to the applicable
Issuer, the Guarantor and the Trustee, may rescind and annul such declaration
and its consequences if
(1) such Issuer or the Guarantor has paid or deposited with the
Trustee a sum sufficient to pay
(A) all overdue installments of interest, if any, on all
Securities of such series,
(B) the principal of and premium, if any, on any Securities of
such series which have become due otherwise than by such declaration of
acceleration, and interest, if any, thereon at the rate or rates
prescribed therefor by the terms of the Securities of such series, to
the extent that payment of such interest is lawful,
(C) to the extent that payment of such interest is lawful,
interest upon overdue installments of interest at the rate or rates
prescribed therefor by the terms of the Securities of such series, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel; and
(2) all Events of Default with respect to such series of Securities,
other than the non-payment of the principal of Securities of such series
which have become due solely by such acceleration, have been cured or
waived as provided in Section 7.12.
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No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 7.03. Collection of Indebtedness and Suits for Enforcement by
Trustee. Each of the Issuers and the Guarantor covenants that if
(1) default is made in the payment of any installment of interest on
any Security of any series when such interest becomes due and payable and
such default continues for a period of 30 days, or
(2) default is made in the payment of the principal of or premium, if
any, on any Security of any series at the Maturity thereof, or
(3) default is made in the making or satisfaction of any sinking fund
payment or analogous obligation when the same becomes due by the terms of
the Securities of any series,
such Issuer or the Guarantor will, upon demand of the Trustee, pay to it, for
the benefit of the Holder of any such Security (or Holders of Securities of any
such series in the case of Clause (3) above), the whole amount then due and
payable on any such Security (or Securities of any such series in the case of
Clause (3) above) for principal, premium, if any, and interest, if any, with
interest upon the overdue principal and premium, if any (to the extent that
payment of such interest is lawful), and (to the extent that payment of such
interest shall be legally enforceable) upon overdue installments of interest, at
the rate or rates prescribed therefor by the terms of any such Security (or
Securities of any such series in the case of Clause (3) above); and, in addition
thereto, such further amount as shall be sufficient to cover the reasonable
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
If such Issuer or the Guarantor fails to pay such amounts forthwith upon
such demand, the Trustee, in its own name and as trustee of an express trust,
may institute a judicial proceeding for the collection of the sums so due and
unpaid, and may prosecute such proceeding to judgment or final decree, and may
enforce the same against such Issuer or the Guarantor or any other obligor upon
such Securities and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of such Issuer or the Guarantor or
any other obligor upon such Securities, wherever situated.
If an Event of Default with respect to any series of Securities occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
SECTION 7.04. Trustee May File Proofs of Claim. With respect to any proofs
of claims filed by the Trustee pursuant to Section 317 of the TIA, the Trustee
shall be entitled to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same and any
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receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Securityholder 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 Securityholders, 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 8.05.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof, or to authorize the trustee to
vote in respect of the claim of any Securityholder in any such proceeding.
SECTION 7.05. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under the Indenture or under the Securities of
any series or the Guarantees may be prosecuted and enforced by the Trustee
without the possession of any of the Securities of such series or the related
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 of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities of such series in respect of which such judgment
has been recovered.
SECTION 7.06. Application of Money Collected. Any money collected by the
Trustee with respect to a series of Securities or the Guarantees 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, premium, if any, or interest, if any, upon presentation of the
Securities of such series or the coupons appertaining thereto, 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 under Section 8.05;
SECOND: To the payment of the amounts then due and unpaid upon the
Securities of such series for principal, premium, if any, and interest, if any,
in respect of which or for the benefit of which such money has been collected,
ratably, without preference or priority of any kind, according to the amounts
due and payable on Securities of such series, for principal, premium, and
interest, respectively; and
THIRD: To the applicable Issuer or the Guarantor.
SECTION 7.07. Limitation on Suits. No Holder of any Security of any series
of an Issuer 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 Securities of such series of
such Issuer;
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(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of such series of such Issuer 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 of such
Issuer;
it being understood and intended that no one or more Holders of Securities of
such series of such Issuer shall have any right in any manner whatever by virtue
of, or by availing of, any provision of this Indenture to affect, disturb or
prejudice the rights of any other Holders of Securities of such series of such
or any other Issuer or to obtain or to seek to obtain priority or preference
over any other such Holders or to enforce any right under this Indenture, except
in the manner herein provided and for the equal and ratable benefit of all the
Holders of Securities of such series of such Issuer.
SECTION 7.08. Restoration of Rights and Remedies. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then and in
every such case the applicable Issuer, the Guarantor, the Trustee and the
Holders 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 the Holders shall continue as though
no such proceeding had been instituted.
SECTION 7.09. Rights and Remedies Cumulative. Except as provided in the
last paragraph of Section 3.06, no right or remedy herein conferred upon or
reserved to the Trustee or to the Holders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent permitted
by law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 7.10. Delay or Omission Not Waiver. No delay or omission of the
Trustee or of any Holder 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 the Holders may be exercised from
time to time, and as often as may be deemed expedient, by the Trustee or by the
Holders, as the case may be.
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SECTION 7.11. Control by Securityholders. The Holders of a majority in
principal amount of the Outstanding Securities of any series of an Issuer 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 of such
Issuer, provided that
(1) such direction shall not be in conflict with any rule of law or with
this Indenture,
(2) the Trustee shall have the right to decline to follow any such
direction if the Trustee in good faith shall, by a Responsible Officer or
Officers of the Trustee, determine that the proceeding so directed would be
prejudicial to the Holders of Securities of such series of such Issuer not
joining in any such direction or would involve the Trustee in personal
liability,
(3) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and
(4) the Trustee has reasonable indemnity against the costs, expenses and
liabilities incurred in compliance with such direction.
SECTION 7.12. Waiver of Past Defaults. The Holders of a majority in
principal amount of the Outstanding Securities of any series of an Issuer may on
behalf of the Holders of all the Securities of such series of such Issuer waive
any past default hereunder and its consequences, except a default not
theretofore cured
(1) in the payment of the principal of, premium, if any, or interest, if
any, on any Security of such series of such Issuer, or in the payment of any
sinking fund installment or analogous obligation with respect to Securities of
such series of such Issuer, 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 of such Issuer 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 the Securities of such series of such Issuer under this Indenture; but no
such waiver shall extend to any subsequent or other default or impair any right
consequent thereon.
SECTION 7.13. Waiver of Stay or Extension Laws. Each of the Issuers and the
Guarantor covenants (to the extent that it may lawfully do so) that it will not
at any time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and each of the Issuers and the Guarantor (to the extent that
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it will not hinder, delay or impede the execution
of any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.
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SECTION 7.14 Original Subscription Agreement and Subscription Agreement.
In the event of a default by Xerox Capital in the performance of its obligations
to pay the principal of, premium, if any, or interest, if any, on any of its
Securities, any Holder of such Securities shall have the right to serve upon
Xerox Capital a demand requiring Xerox Capital to thereafter serve a demand upon
its then Majority Shareholder to subscribe for additional shares in the share
capital of Xerox Capital pursuant to and in accordance with the provisions of
the Original Subscription Agreement or (following execution) the Subscription
Agreement. Upon receipt of any such demand from any Holder of such Securities,
Xerox Capital shall, if and to the extent that it shall have rights to call for
the subscription of further shares under the Original Subscription Agreement or
the Subscription Agreement, as the case may be, serve upon its then Majority
Shareholder a written demand for the subscription of additional shares in the
share capital of Xerox Capital pursuant to and subject to the provisions of the
Original Subscription Agreement or the Subscription Agreement, as the case may
be.
ARTICLE EIGHT
THE TRUSTEE
SECTION 8.01. Certain Rights of Trustee. Except as otherwise provided in
Section 315 of the TIA:
(a) 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, note or other paper or
document believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request or direction of an Issuer or the Guarantor mentioned herein
shall be sufficiently evidenced by an Issuer Request or Issuer Order and any
resolution of the Board of Directors of such Issuer or the Guarantor may be
sufficiently evidenced by a Board Resolution;
(c) 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 be herein
specifically prescribed) may, in the absence of bad faith on its part, rely upon
an Officers' Certificate;
(d) the Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;
(f) 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, note 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,
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and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the applicable Issuer and the Guarantor, personally or by agent or attorney;
(g) 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;
(h) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Indenture; and
(i) no provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers, if the Trustee in good faith believes that the repayment of such funds
or adequate indemnity against such risk or liability is not reasonably assured
to it.
SECTION 8.02. Not Responsible for Recitals or Issuance of Securities. The
recitals contained herein and in the Securities, except the certificates of
authentication, shall be taken as the statements of the Issuers or the
Guarantor, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Securities. The Trustee shall not be accountable for the use
or application by the Issuers or the Guarantor of Securities or the proceeds
thereof.
SECTION 8.03. May Hold Securities. The Trustee, any Paying Agent, Security
Registrar or any other agent of any of the Issuers or the Guarantor, in its
individual or any other capacity, may become the owner or pledgee of Securities
and, subject to Sections 310(b) and 311 of the TIA, may otherwise deal with each
of the Issuers and the Guarantor with the same rights it would have if it were
not Trustee, Paying Agent, Security Registrar or such other agent.
The following indentures shall be excluded from the operation of Section
310(b)(1) of the TIA: Indenture dated as of December 1, 1991, between Xerox
Corporation and Citibank, N.A., as Trustee; and Indenture dated as of September
20, 1996, between Xerox Corporation and Citibank, N.A., as Trustee.
SECTION 8.04. Money Held in Trust. Money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required
by law. The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed with the applicable Issuer
or the Guarantor, as the case may be.
SECTION 8.05. Compensation and Reimbursement. Each of the Issuers and the
Guarantor agrees
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(1) to pay to the Trustee from time to time such reasonable compensation
for all services rendered by it hereunder as may be agreed upon between any such
Issuer, the Guarantor and the Trustee (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 its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of this
trust, including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder.
As security for the performance of the obligations of each such Issuer and
the Guarantor under this Section the Trustee shall have a lien prior to the
Securities of such Issuer upon all property and funds held or collected in
respect of such Securities of such Issuer by the Trustee as such, except funds
held in trust for the payment of principal of, premium, if any, or interest, if
any, on particular Securities of such Issuer.
SECTION 8.06. Corporate Trustee Required; Eligibility. The Trustee shall at
all times satisfy the eligibility requirements of Section 310 of the TIA and
together with its immediate parent maintain a combined capital and surplus of at
least $50,000,000. If the Trustee together with its immediate parent publishes a
report of condition at least annually, pursuant to law or pursuant to the
requirements of any Federal, State, territorial, or District of Columbia
supervising or examining authority to which the Trustee is subject, then, for
purposes of this section, the combined capital and surplus of the Trustee shall
be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee with respect to any series of
Securities 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 8.07. Resignation and Removal; Appointment of Successor. (a) 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 under Section 8.08.
(b) The Trustee may resign with respect to any series of Securities of an
Issuer at any time by giving written notice thereof to such Issuer and the
Guarantor. If an instrument of acceptance by a successor Trustee 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
Securities of such series.
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(c) The Trustee may be removed with respect to any series of Securities of
an Issuer at any time by Act of the Holders of a majority in principal amount of
the Outstanding Securities of such series, delivered to the Trustee and to such
Issuer and the Guarantor.
(d) If at any time:
(1) the Trustee for a series of Securities shall fail to comply with
Section 310(b)(i) of the TIA after written request therefor by the
applicable Issuer or the Guarantor or by any Securityholder who has been a
bona fide Holder of a Security of such series for at least six months, or
(2) the Trustee for a series of Securities shall cease to be
eligible under Section 8.06 hereof or Section 310(a) of the TIA and shall
fail to resign after written request therefor by the applicable Issuer or
the Guarantor or by any such Securityholder, or
(3) the Trustee for a series of Securities 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 applicable Issuer or the Guarantor by or
pursuant to a Board Resolution may remove the Trustee with respect to such
series of Securities, or (ii) subject to Section 315(e) of the TIA, any
Securityholder 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 and
the appointment of a successor Trustee with respect to such series.
(e) If the Trustee shall resign, be removed or become incapable of acting
with respect to any series of Securities, or if a vacancy shall occur in the
office of Trustee with respect to any series of Securities of an Issuer for any
cause, such Issuer and the Guarantor, by or pursuant to a Board Resolution,
shall promptly appoint a successor Trustee with respect to such series of
Securities. If, within one year after such resignation, removal or incapability,
or the occurrence of such vacancy, a successor Trustee with respect to such
series of Securities shall be appointed by the Act of the Holders of a majority
in principal amount of the Outstanding Securities of such series delivered to
such Issuer and the Guarantor and the retiring Trustee with respect to such
series, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment, become the successor Trustee with respect to such series
and supersede the successor Trustee appointed by such Issuer and the Guarantor
with respect to such series. If no successor Trustee with respect to such series
shall have been so appointed by such Issuer and the Guarantor or the Holders of
Securities of such series and accepted appointment in the manner hereinafter
provided, any Securityholder 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
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any court of competent jurisdiction for the appointment of a successor Trustee
with respect to such series.
(f) The applicable Issuer shall give notice of each resignation and each
removal of the Trustee with respect to any series of Securities of such Issuer
and each appointment of a successor Trustee with respect to any series of
Securities of such Issuer by mailing written notice of such event by first-class
mail, postage prepaid, to Registered Holders of Securities of such series as
their names and addresses appear in the Security Register and to all other
Holders of Securities of such series by publishing notice of such event once in
an Authorized Newspaper in the Place of Payment. Each notice shall include the
name of such successor Trustee and the address of its Principal Corporate Trust
Office.
SECTION 8.08. Acceptance of Appointment by Successor. In case of the
appointment hereunder of a successor Trustee with respect to all Securities,
every such successor Trustee appointed hereunder shall execute, acknowledge and
deliver to each of the Issuers, the Guarantor and the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective with respect to all or any series
as to which it is resigning as Trustee, 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 all or any
such series; but, on request of any of the Issuers, the Guarantor or such
successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of such retiring Trustee with respect to all or any
such series; and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to all or any such series; subject nevertheless to its lien, if any,
provided for in Section 8.05. Upon request of any such successor Trustee, each
of the Issuers and the Guarantor 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.
In case of the appointment hereunder of a successor Trustee with respect to
the Securities of one or more (but not all) series of one or more Issuers, the
applicable Issuer, the Guarantor, the retiring Trustee and each successor
Trustee with respect to the Securities of any applicable series shall execute
and deliver an indenture supplemental hereto which 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 any series as to which the retiring Trustee is not retiring shall continue to
be vested in the retiring Trustee, and shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be Trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee.
No successor Trustee with respect to a series of Securities of any Issuer
shall accept its appointment unless at the time of such acceptance such
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successor Trustee shall be qualified and eligible with respect to such series
under this Article and the TIA.
SECTION 8.09. Merger Conversion, Consolidation or Succession to Business of
Trustee. 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,
provided that such corporation shall be otherwise qualified and eligible under
this Article and the TIA, 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 8.10. Appointment of Authenticating Agent. As of the date of the
Indenture and at any time when any of the Securities remain Outstanding the
Trustee, with the consent of the applicable Issuer and the Guarantor, may
appoint an Authenticating Agent or Agents with respect to one or more series of
Securities of such Issuer which shall be authorized to act on behalf of the
Trustee to authenticate Securities of such series issued upon exchange,
registration of transfer, or partial redemption thereof, and Securities so
authenticated shall be entitled to the benefits of this Indenture and shall be
valid and obligatory for all purposes as if authenticated by the Trustee
hereunder.
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 applicable Issuer and the
Guarantor and shall meet the requirements of Section 8.06, unless otherwise
agreed to by such Issuer and the Guarantor, as though it were trustee.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee, the applicable Issuer and the Guarantor. The Trustee may
at any time terminate the agency of an Authenticating Agent by giving written
notice thereof to such Authenticating Agent and to the applicable Issuer and the
Guarantor. 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
applicable Issuer and the Guarantor and shall give notice of such appointment in
accordance with Section 1.06 to all Holders of Securities of the series with
respect to which such Authenticating Agent will serve. 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.
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The provisions of Sections 3.08, 8.02 and 8.03 shall be applicable to each
Authenticating Agent.
The applicable Issuer and the Guarantor agree to pay to each Authenticating
Agent from time to time reasonable compensation for its services under this
Section.
The Trustee shall incur no liability for the appointment or for any
misconduct or negligence of an Authenticating Agent. In the event the Trustee
does incur liability for any such misconduct or negligence of the Authenticating
Agent, the applicable Issuer and the Guarantor agree to indemnify the Trustee
for, and hold it harmless against, any such liability, including the costs and
expenses of defending itself against any liability in connection with such
misconduct or negligence of the Authenticating Agent.
If an appointment with respect to one or more series is made pursuant to
this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternate
certificate of authentication in the following form:
This is one of the Securities, of the series designated herein, described
in the within-mentioned Indenture.
CITIBANK, N.A.
as Trustee
Dated: By. . . . . . . . . . . . . . . . . .
As Authenticating Agent
By. . . . . . . . . . . . . . . . . .
Authorized Signatory
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 9.01. Supplemental Indentures Without Consent of Securityholders.
Without the consent of any Holders of any Securities, any Issuer or the
Guarantor, when authorized by or pursuant to a Board Resolution of such Issuer
or the Guarantor, as the case may be, 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 corporation to such Issuer or the
Guarantor, and the assumption by any such successor of the covenants of such
Issuer or the Guarantor herein and in the Securities or the Guarantees
contained; or
(2) to evidence and provide for the acceptance of appointment by another
corporation as a successor Trustee hereunder with respect to one or more series
of Securities of one or more Issuers and to add to or change any
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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 Section 8.08; or
(3) to add to the covenants of such Issuer or the Guarantor, for the
benefit of the Holders of Securities of all or any series, or to surrender any
right or power herein conferred upon such Issuer or the Guarantor, provided that
such action shall not adversely affect the interests of the Holders of
Securities of any series of such Issuer in any material respect; or
(4) to cure any ambiguity, to correct or supplement any provision in this
Indenture or in the Securities of such Issuer or the Guarantees which may be
inconsistent with any other provision in this Indenture or in such Securities or
in such Guarantees, or to make any other provisions with respect to matters or
questions arising under this Indenture or in such Securities or the Guarantees;
or
(5) to establish the form of any Security, as permitted by Section 2.02,
and to provide for the issuance of any series of Securities, as permitted by
Section 3.01, and to set forth the terms thereof; or
(6) to make any other amendments, modifications or supplements hereto or to
the Securities or the Guarantees, provided, that such amendments, modifications
or supplements shall only apply to Securities of one or more series and the
Guarantees to be thereafter issued or shall not adversely affect the rights of
any Holder of any Outstanding Security of such Issuer.
SECTION 9.02. Supplemental Indentures with Consent of Securityholders. 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 or indentures (each such series voting separately as a class), by Act
of said Holders delivered to the applicable Issuer, the Guarantor and the
Trustee, the applicable Issuer and the Guarantor, when authorized by or pursuant
to a Board Resolution of such Issuer and the Guarantor, as the case may be, 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 such Securities or of modifying in
any manner the rights of the Holders of Securities of each such series under
this Indenture or such Securities; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Security
affected thereby:
(1) change the Maturity of the principal of, or the premium, if any, or the
Stated Maturity of any installment of interest, if any, on, any Security, or
reduce the principal amount thereof or any premium thereon or the rate of
interest thereon, or change the method of computing the amount of principal
thereof on any date or change the coin or currency in which any Security or any
premium or interest thereon is payable, or impair the right to institute suit
for the enforcement of any such payment on or after the Maturity or the Stated
Maturity, as the case may be, thereof (or, in the case of redemption or
repayment, on or after the Redemption Date or the Repayment Date, as the case
may be); 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 of certain
defaults hereunder and their consequences) provided for in this Indenture; or
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(3) modify any of the provisions of this Section, Section 5.07 or Section
7.12, 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.
It shall not be necessary for any Act of Securityholders 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 9.03. Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel in compliance with Section 314
of the TIA stating that the execution of such supplemental indenture is
authorized or permitted by and complies with 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 9.04. Effect of Supplemental Indentures. Upon the execution of any
supplemental indenture under this Article, this Indenture shall be modified in
accordance therewith, and such supplemental indenture shall form a part of this
Indenture for all purposes; and every Holder of Securities theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.
SECTION 9.05. Conformity with Trust Indenture Act. Every supplemental
indenture executed pursuant to this Article shall conform to the requirements of
TIA as then in effect.
SECTION 9.06. 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 applicable Issuer and the
Guarantor shall so determine, new Securities of any Series so modified as to
conform, in the opinion of the Trustee, such Issuer and the Guarantor, to any
such supplemental indenture may be prepared and executed by such Issuer, the
notation of the Guarantor of the Guarantees endorsed thereon may be prepared and
executed by the Guarantor and such Securities may be authenticated and delivered
by the Trustee in exchange for Outstanding Securities of such series.
ARTICLE TEN
CONSOLIDATION, MERGER, CONVEYANCE OR TRANSFER
SECTION 10.01. Company May Consolidate, etc., Only on Certain Terms. So
long as any Securities of any of the Issuers are Outstanding, the Company shall
not consolidate with or merge into any other corporation or convey or transfer
its properties and assets substantially as an entirety to any Person, unless
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(1) the corporation formed by such consolidation or into which the Company
is merged or the Person which acquires by conveyance or transfer the properties
and assets of the Company substantially as an entirety shall be organized and
existing under the laws of the United States of America or any State or the
District of Columbia, and shall expressly assume, by an indenture supplemental
hereto, executed and delivered to the Trustee, in form satisfactory to the
Trustee, the due and punctual payment of the principal of, premium, if any, and
interest, if any, on all the Securities and the performance of every covenant of
this Indenture on the part of the Company to be performed or observed (including
the performance or observance of the Guarantees);
(2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have happened and be continuing; and
(3) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel each stating that such consolidation, merger, conveyance
or transfer and such supplemental indenture comply with this Article and that
all conditions precedent herein provided for relating to such transaction have
been complied with.
SECTION 10.02. Subsidiary Issuers May Consolidate, etc., Only on Certain
Terms. So long as any Securities of any Subsidiary Issuer are outstanding, such
Subsidiary Issuer shall not consolidate with or merge into any other corporation
or sell its assets substantially as an entirety, unless (i) the corporation
formed by such consolidation or into which such Subsidiary Issuer is merged or
the corporation which acquires its assets is organized in the United States or
of England and Wales and expressly assumes the due and punctual payment of the
principal of, premium, if any, and interest, if any, on all Securities of such
Subsidiary Issuer and the performance of every covenant of this Indenture on the
part of such Subsidiary Issuer to be performed or observed and (ii) immediately
after giving effect to such transaction, no Event of Default, and no event
which, after notice or lapse of time, or both, would become an Event of Default,
shall have occurred and be continuing.
Notwithstanding the immediately preceding paragraph, any Subsidiary Issuer
shall be entitled at any time to sell, transfer or assign all or any part of its
assets for fair value or grant any interest therein to any person or persons in
connection with any Securitization in relation to such assets (whether or not by
such Subsidiary Issuer or any of its subsidiaries) and to enter into any
arrangements in connection therewith.
SECTION 10.03. Successor Corporation Substituted. Upon any consolidation or
merger, or any conveyance or transfer of the properties and assets of an Issuer
or the Guarantor substantially as an entirety in accordance with Section 10.01
or Section 10.02, the successor corporation formed by such consolidation or into
which such Issuer or the Guarantor is merged or to which such conveyance or
transfer is made shall succeed to, and be substituted for, and may exercise
every right and power of, such Issuer and the Guarantor under this Indenture
with the same effect as if such successor corporation had been named as such
Issuer and the Guarantor herein. In the event of any such conveyance or
transfer, the applicable Issuer and the
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Guarantor as the predecessor corporation shall be discharged from its
obligations hereunder and may be dissolved, wound up and liquidated at any time
thereafter.
SECTION 10.04. Securities to be Secured in Certain Events. If, upon any
such consolidation or merger of the Company, or upon any conveyance or transfer
of the properties and assets of the Company substantially as an entirety to any
other Person, any property, whether now owned or hereafter acquired, or right to
receive income of the Company or any Restricted Subsidiary would thereupon
become subject to any lien, security interest or other charge or encumbrance, or
any other type of preferential arrangement (any such lien, security interest or
other charge or encumbrance, or any other type of preferential arrangement being
herein called a "Mortgage"), unless the Company could create such Mortgage
pursuant to Section 5.06 without equally and ratably securing the Securities,
the Company, prior to such consolidation, merger, conveyance or transfer, will
secure the Outstanding Securities of each series hereunder, equally and ratably
with (or prior to) the Debt secured by such Mortgage.
SECTION 10.05. Assumption by Company of Subsidiary Issuers' Obligations.
(a) The Company may, at its option, assume the obligations of a Subsidiary
Issuer as obligor under any series of Securities of such Subsidiary Issuer and
this Indenture; provided that:
(i) the Company expressly assumes in an assumption agreement or
supplemental indenture executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal
of and any premium and interest on such Securities and the performance or
observance of every covenant of this Indenture on the part of such
Subsidiary Issuer to be performed or observed;
(ii) immediately after giving effect to such assumption, no Event of
Default and no event, which after notice or lapse of time or both, would
become an Event of Default, shall have occurred and be continuing; and
(iii) the Company shall have delivered to the Trustee an Officers'
Certificate stating that such assumption and such assumption agreement
comply with this Article and that all conditions precedent herein provided
for relating to such assumption have been complied with.
(b) Upon any assumption pursuant to Section 10.05, the Company shall
succeed to, and be substituted for, any may exercise every right and power of,
the applicable Subsidiary Issuer under such Securities and this Indenture with
the same effect as if the Company had been such Issuer thereof, and such
Subsidiary Issuer shall be released from its liability as obligor upon such
Securities and this Indenture.
ARTICLE ELEVEN
SATISFACTION AND DISCHARGE
SECTION 11.01. Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect (except as to any surviving
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rights of registration of transfer or exchange of Securities herein expressly
provided for and rights to receive payments thereon pursuant to Section 11.02),
with respect to a series of Securities, and the Trustee, on demand of and at the
expense of the applicable Issuer or the Guarantor, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture with
respect to such series of Securities, when
(1) either
(A) all Securities of such series theretofore authenticated and
delivered (other than (i) Securities of such series which have been
destroyed, lost or stolen and which have been replaced or paid as provided
in Section 3.06, and (ii) Securities of such series for whose payment money
has theretofore been deposited in trust or segregated and held in trust by
such Issuer or the Guarantor and thereafter repaid to such Issuer or the
Guarantor or discharged from such trust, as provided in Section 5.03) have
been delivered to the Trustee for cancellation; or
(B) all such Securities of such series not theretofore
delivered to the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Maturity within
one year, or
(iii) 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 such
Issuer or the Guarantor,
and such Issuer or the Guarantor, 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 the purpose, an amount sufficient to pay and discharge the entire
indebtedness on such Securities of such series not theretofore delivered to
the Trustee for cancellation, for principal, premium, if any, and interest,
if any, to the date of such deposit (in the case of Securities of such
series which have become due and payable), or to the Maturity or Redemption
Date, as the case may be;
(2) such Issuer or the Guarantor has paid or caused to be paid all other
sums payable hereunder by such Issuer or the Guarantor with respect to the
Securities of such series;
(3) such Issuer or the Guarantor has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this Indenture
with respect to the Securities of such series have been complied with; and
(4) such Issuer or the Guarantor has delivered to the Trustee an Opinion of
Counsel stating that (i) such Issuer or the Guarantor has received from, or
there has been published by, the Internal Revenue Service a ruling or (ii) since
the date of this Indenture there has been a change in the
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<PAGE> 64
applicable Federal income tax law, in either case to the effect that, and based
thereon such Opinion will confirm that, the Holders of the Outstanding
Securities of such series will not recognize income, gain or loss for Federal
income tax as a result of such satisfaction and discharge and will be subject to
the Federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such satisfaction and discharge had not
occurred.
Notwithstanding the satisfaction and discharge of the Indenture, the obligations
of such Issuer and the Guarantor to the Trustee under Section 8.05 shall
survive.
SECTION 11.02. Application of Trust Money. All money deposited with the
Trustee pursuant to Section 11.01 shall be held in trust and applied by it, in
accordance with the provisions of the Securities and this Indenture, to the
payment, either directly or through any Paying Agent (including the applicable
Issuer or the Guarantor acting as its own Paying Agent), as the Trustee may
determine, to the Persons entitled thereto, of the principal, premium, if any,
and interest, if any, for whose payment such money has been deposited with the
Trustee; but such money need not be segregated from other funds except to the
extent required by law.
ARTICLE TWELVE
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
SECTION 12.01. Exemption from Individual Liability. No recourse for the
payment of the principal of, or premium, if any, or interest, if any, on any
Security, or for any claim based thereon or otherwise in respect thereof, and no
recourse under or upon any obligation, covenant or agreement of any Issuer or
the Guarantor in this Indenture or any supplemental indenture, or in any
Security, or under any Guarantee, or for any claim based thereon or otherwise in
respect thereof, shall be had against any incorporator, stockholder, officer or
director, as such, past, present or future, of any Issuer or the Guarantor or of
any successor corporation, either directly or through any Issuer or the
Guarantor, whether by virtue of any constitution, statute or rule of law, or by
the enforcement of any assessment or penalty or otherwise; it being expressly
understood that this Indenture and the obligations issued hereunder are solely
corporate obligations of the applicable Issuer or the Guarantor, and that no
such personal liability whatever shall attach to, or is or shall be incurred by,
the incorporators, stockholders, officers or directors, as such, of any Issuer
or the Guarantor or of any successor corporation, or any of them, because of the
creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or any
supplemental indenture, or in any of the Securities, or in any of the Guarantees
or implied therefrom; and that any and all such personal liability, either at
common law or in equity or by constitution or statute, of, and any and all such
rights and claims against, every such incorporator, stockholder, officer or
director, as such, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or agreements
contained in this Indenture or any supplemental indenture, or in any of the
Securities or in any of the Guarantees or implied therefrom, are hereby
expressly waived and released as a condition of, and as consideration
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for, the execution of this Indenture and the Guarantees and the issuance of the
Securities.
ARTICLE THIRTEEN
MEETINGS OF HOLDERS OF SECURITIES
SECTION 13.01. Purposes of Meetings. A meeting of Holders of Securities of
all or any series may be called at any time and from time to time pursuant to
the provisions of this Article for any of the following purposes:
(1) to give any notice to any of the Issuers, the Guarantor or the Trustee,
or to give any directions to the Trustee, or to waive any default hereunder and
its consequences, or to take any other action authorized to be taken by the
Holders of Securities pursuant to any of the provisions of Article Seven;
(2) to remove the Trustee and appoint a successor Trustee pursuant to the
provisions of Article Eight;
(3) to consent to the execution of an indenture or indentures supplemental
hereto pursuant to the provisions of Section 9.02; or
(4) to take any other action authorized to be taken by or on behalf of the
Holders of any specified percentage in aggregate principal amount of the
Securities of all or any series, as the case may be, under any other provision
of this Indenture or under applicable law.
SECTION 13.02. Call of Meetings by Trustee. The Trustee may at any time
call a meeting of Holders of Securities of all or any series to take any action
specified in Section 13.01 to be held at such time and at such place as the
Trustee shall determine or at such other place as may be provided with respect
to the Securities of such series. Notice of every meeting of the Holders of
Securities of all or any series, setting forth the time and place of such
meeting and in general terms the action proposed to be taken at such meeting,
shall be given to all holders of Securities of each series that are to be
affected by the action proposed to be taken at such meeting by publication at
least twice in an Authorized Newspaper in the Borough of Manhattan, The City of
New York or in such other place as may be provided with respect to the
Securities of such series prior to the date fixed for the meeting, the first
publication to be not less than 20 nor more than 180 days prior to the date
fixed for the meeting, and the last publication to be not more than five days
prior to the date fixed for the meeting, or such notice may be given to
Registered Holders by mailing the same by registered mail, postage prepaid, to
the Holders of Registered Securities at the time Outstanding, at their address
as they shall appear in the Security Register, not less than 20 nor more than 60
days prior to the date fixed for the meeting. Failure to receive such notice or
any defect therein shall in no case affect the validity of any action taken at
such meeting. Any meeting of Holders of Securities of all or any series of any
Issuer shall be valid without notice if the Holders of all such Securities
Outstanding, such Issuer and the Trustee are present in person or by proxy or
shall have waived notice thereof before or after the meeting.
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SECTION 13.03. Call of Meetings by Issuers or Securityholders. In case at
any time any Issuer, by or pursuant to a Board Resolution of such Issuer, or the
Holders of at least 10% in aggregate principal amount of Securities then
Outstanding of each series that may be affected by the action proposed to be
taken at the meeting shall have requested the Trustee to call a meeting of
Holders of Securities of all series that may be so affected to take any action
authorized in Section 13.01 by written request setting forth in reasonable
detail the action proposed to be taken at the meeting, and the Trustee shall not
have mailed or made the first publication of the notice of such meeting within
30 days after receipt of such request, then such Issuer or the Holders in the
amount above specified may determine the time and the place referred to in
Section 13.02 for such meeting and may call such meeting by mailing or
publishing notice thereof as provided in Section 13.02.
SECTION 13.04. Qualifications for Voting. To be entitled to vote at any
meeting of Securityholders a Person shall (a) be a Holder of one or more
Securities of a series affected by the action proposed to be taken, or (b) be a
Person appointed by an instrument in writing as proxy by the Holder of one or
more such Securities. The right of Securityholders to have their votes counted
shall be subject to the proviso in the definition of "Outstanding" in Section
1.01. The only Persons who shall be entitled to be present or to speak at any
meeting of Securityholders shall be the Persons entitled to vote at such meeting
and their counsel, any representatives of the Trustee and its counsel, any
representatives of the applicable Issuer and its counsel, and any
representatives of the Guarantor and its counsel.
SECTION 13.05. Quorum; Adjourned Meetings. At any meeting of
Securityholders, the presence of Persons holding or representing Securities in
an aggregate principal amount sufficient to take action on the business for the
transaction of which such meeting was called shall be necessary to constitute a
quorum. No business shall be transacted in the absence of a quorum unless a
quorum is represented when the meeting is called to order. In the absence of a
quorum within 30 minutes of the time appointed for any such meeting, the meeting
shall, if convened at the request of the Holders of Securities (as provided in
Section 13.03), be dissolved. In any other case the Persons holding or
representing a majority in aggregate principal amount of the Securities
represented at the meeting may adjourn such a meeting for a period of not less
than 10 days with the same effect, for all intents and purposes, as though a
quorum had been present. In the absence of a quorum at any such adjourned
meeting, such adjourned meeting may be similarly further adjourned for a period
of not less than 10 days. Notice of the reconvening of any such adjourned
meeting shall be given as provided in Section 13.02 except that, in the case of
publication, such notice need be published only once but must be given not less
than five days prior to the date on which the meeting is scheduled to be
reconvened, and in the case of mailing, such notice may be mailed not less than
five days prior to such date.
Any Holder of a Security who has executed an instrument in writing
complying with the provisions of Section 1.04 shall be deemed to be present for
the purposes of determining a quorum and be deemed to have voted; provided,
however, that such holder shall be considered as present or voting only with
respect to the matters covered by such instrument in writing.
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Any resolution passed or decision taken at any meeting of the Holders of
Securities of any series duly held in accordance with this Section shall be
binding on all Holders of such series of Securities whether or not present or
represented at the meeting.
SECTION 13.06. Regulations. 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, in regard to proof of the
holding of Securities 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 think fit.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by any Issuer
or by Holders of Securities as provided in Section 13.03, in which case such
Issuer or the Holders of Securities 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 Holders of a
majority in principal amount of the Securities represented at the meeting.
At any meeting each Holder of a Security of a series entitled to vote at
such meeting, or proxy therefor, shall be entitled to one vote for each $1,000
principal amount (in the case of Original Issue Discount Securities, such
principal amount to be determined as provided in the definition of
"Outstanding") 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 Securities of such series or proxy therefor.
Any meeting of Holders of Securities duly called pursuant to the provisions of
Section 13.02 or 13.03 at which a quorum is present may be adjourned from time
to time, and the meeting may be held as so adjourned without further notice.
SECTION 13.07. Voting Procedure. The vote upon any resolution submitted to
any meeting of Securityholders shall be by written ballot on which shall be
subscribed the signatures of the Holders of Securities entitled to vote at such
meeting, or proxies therefor, and on which shall be inscribed an identifying
number or numbers or to which shall be attached a list of identifying numbers of
the Securities so 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 duplicate of all
votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of Holders of Securities 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 mailed or published as provided in
Section 13.02 and, if applicable, Section 13.05. The record shall be signed and
verified by the permanent chairman and secretary of the meeting and one of the
triplicates shall be delivered to the applicable Issuer, the other to the
Guarantor, and the other to the Trustee to be preserved by the Trustee, the
latter to have attached thereto the ballots voted at the meeting.
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Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
SECTION 13.08. Written Consent in Lieu of Meetings. The written
authorization or consent by the Holders of the requisite percentage in aggregate
principal amount of Securities of any series herein provided, entitled to vote
at any such meeting, evidenced as provided in Section 1.04 and filed with the
Trustee, shall be effective in lieu of a meeting of the Holders of Securities of
such series, with respect to any matter provided for in this Article Thirteen.
SECTION 13.09. No Delay of Rights by Meeting. Nothing in this Article
contained shall be deemed or construed to authorize or permit, by reason of any
call of a meeting of Holders of Securities of any or all series or any rights
expressly or impliedly conferred hereunder to make such call, any hindrance or
delay in the exercise of any right or rights conferred upon or reserved to the
Trustee or the Holders of the Securities of any or all such series under any
provisions of this Indenture or the Securities.
ARTICLE FOURTEEN
GUARANTEES OF SECURITIES OF SUBSIDIARY ISSUERS
SECTION 14.01. Guarantees. This Section 14.01 and Section 14.02 apply to
the Securities of any series of any Subsidiary Issuer to the extent that the
form of the Guarantees to be endorsed on such Securities is not otherwise
established as contemplated by Section 3.01.
The Guarantor hereby fully and unconditionally guarantees to each Holder of
a Security of each series issued by a Subsidiary Issuer, authenticated and
delivered by the Trustee the due and punctual payment of the principal
(including any amount due in respect of any Original Issue Discount Security) of
and any premium and interest on such Security, and the due and punctual payment
of any sinking fund payments provided for pursuant to the terms of such
Security, when and as the same shall become due and payable, whether at the
Stated Maturity, by declaration of acceleration, call for redemption, early
repayment or otherwise, in accordance with the terms of such Security and this
Indenture. The Guarantor hereby agrees that in the event of an Event of Default
its obligations hereunder shall be as if it were a principal debtor and not
merely a surety, and shall be absolute and unconditional, irrespective of, and
shall be unaffected by, any invalidity, irregularity or unenforceability of any
Security of any series or this Indenture, any failure to enforce the provisions
of any Security of any series or this Indenture, any waiver, modification or
indulgence granted to the applicable Subsidiary Issuer with respect thereto, by
the Holder of any Security of any series of such Subsidiary Issuer or the
Trustee, or any other circumstances which may otherwise constitute a legal or
equitable discharge of a surety or Guarantor; provided, however, that,
notwithstanding the foregoing, no such waiver, modification or indulgence shall,
without the consent of the Guarantor, increase the principal amount of any
Security of a Subsidiary Issuer or the interest rate thereon or increase any
premium payable upon redemption thereof. The Guarantor hereby waives diligence,
presentment, demand of payment, filing of claims with a court in the event of
merger or bankruptcy of the applicable Subsidiary Issuer, any right to require a
proceeding first against such
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Subsidiary Issuer, the benefit of discussion, protest or notice with respect to
any Security of such Subsidiary Issuer or the indebtedness evidenced thereby or
with respect to any sinking fund payment required pursuant to the terms of such
Security issued under this Indenture and all demands whatsoever, and covenants
that this Guarantee will not be discharged with respect to such Security except
by payment in full of the principal thereof and any premium and interest thereon
or as provided in Article Eleven or Section 10.01. If any Holder or the Trustee
is required by any court or otherwise to return to any Subsidiary Issuer, the
Guarantor, or any custodian, trustee, liquidator or other similar official
acting in relation to such Issuer or the Guarantor any amount paid by such
Issuer or the Guarantor to the Trustee or such Holder, this Guarantee to the
extent theretofore discharged, shall be reinstated in full force and effect. The
Guarantor further agrees that, as between the Guarantor, on the one hand, and
the Holders and the Trustee, on the other hand, the Maturity of the obligations
guaranteed hereby may be accelerated as provided in Article Seven hereof for the
purposes of this Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations
guaranteed hereby.
The Guarantor also agrees, to pay any and all reasonable costs and expenses
(including reasonable attorneys' fees and expenses) incurred by the Trustee or
any Holders in enforcing any rights under this Guarantee.
The Guarantor hereby waives any right of set-off which the Guarantor may
have against the Holder of any Security of a Subsidiary Issuer in respect of any
amounts which are or may become payable by such Holder to such Subsidiary
Issuer.
The Guarantor shall be subrogated to all rights of the Holders of any
series of Securities and the Trustee against the applicable Subsidiary Issuer in
respect of any amounts paid to such Holders and the Trustee by the Guarantor
pursuant to the provisions of the Guarantees; provided, however, that the
Guarantor shall not be entitled to enforce or to receive any payments arising
out of or based upon, such right of subrogation until the principal of, premium,
if any, and interest, if any, on all of the Securities of such series shall have
been paid in full.
No past, present or future stockholder, officer, director, employee or
incorporator of the Guarantor shall have any personal liability under the
Guarantees set forth in this Section 14.01 by reason of his or its status as
such stockholder, officer, director, employee or incorporator.
The Guarantees set forth in this Section 14.01 shall not be valid or become
obligatory for any purpose with respect to a Security until the certificate of
authentication on such Security shall have been signed by or on behalf of the
Trustee.
SECTION 14.02. Execution of Guarantees. To evidence its Guarantee to the
Holders specified in Section 14.01, the Guarantor hereby agrees to execute the
notation of the Guarantee in substantially the form set forth in Section 2.04 to
be endorsed on each Security of each Subsidiary Issuer authenticated and
delivered by the Trustee. The Guarantor hereby agrees that its Guarantee set
forth in Section 14.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Security of each Subsidiary
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<PAGE> 70
Issuer a notation of such Guarantee. Each such notation of such Guarantee shall
be signed on behalf of the Guarantor by any proper officer of the Guarantor
prior to the authentication of the Security on which it is endorsed, and the
delivery of such Security by the Trustee, after the due authentication thereof
by the Trustee hereunder, shall constitute due delivery of the Guarantee on
behalf of the Guarantor. Such signatures upon the notation of the Guarantee may
be manual or facsimile signatures of any present, past or future such proper
officer of the Guarantor and may be imprinted or otherwise reproduced below the
notation of the Guarantee, and in case any such proper officer of the Guarantor
who shall have signed the notation of the Guarantee shall cease to be such
officer before the Security on which such notation is endorsed shall have been
authenticated and delivered by the Trustee or disposed of by the applicable
Subsidiary Issuer, such Security nevertheless may be authenticated and delivered
or disposed of as though the person who signed the notation of the Guarantee had
not ceased to be such officer of the Guarantor.
Citibank, N.A. hereby accepts the trusts in this Indenture declared and
provided, upon the terms and conditions hereinabove set forth.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
XEROX CORPORATION,
as an Issuer and the Guarantor
BY _____________________________
Title:
Attest:
______________________________ [CORPORATE SEAL]
Title:
XEROX OVERSEAS HOLDINGS PLC,
as an Issuer
BY _____________________________
Title:
BY _____________________________
Title:
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<PAGE> 71
Attest:
______________________________ [CORPORATE SEAL]
Title:
RANK XEROX CAPITAL (EUROPE) PLC,
as an Issuer
BY _____________________________
Title:
BY _____________________________
Title:
Attest:
______________________________ [CORPORATE SEAL]
Title:
CITIBANK, N.A., as Trustee
BY _____________________________
Title:
Attest:
______________________________ [CORPORATE SEAL]
Title:
65
<PAGE> 72
COUNTY OF FAIRFIELD, )
) ss.:
STATE OF CONNECTICUT, )
On this day of August, 1997, before me personally appeared , to me known,
who being by me duly sworn, did depose and say that (s)he resides at
;
that (s)he is of XEROX CORPORATION, one of the corporations
described in and which executed the foregoing instrument; that (s)he knows the
corporate seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation; and that (s)he signed her/his name thereto by
like authority.
---------------------------------
Notary Public
My Commission Expires
[NOTARIAL SEAL]
COUNTY OF FAIRFIELD, )
) ss.:
STATE OF CONNECTICUT, )
On this day of August, 1997, before me personally appeared , to me known,
who being by me duly sworn, did depose and say that (s)he resides at
;
that (s)he is of XEROX OVERSEAS HOLDINGS PLC, one of the corporations described
in and which executed the foregoing instrument; that (s)he knows the corporate
seal of said corporation; that the seal affixed to said instrument is such
corporate seal; that it was so affixed by authority of the Board of Directors of
said corporation; and that (s)he signed her/his name thereto by like authority.
---------------------------------
Notary Public
My Commission Expires
[NOTARIAL SEAL]
COUNTY OF FAIRFIELD, )
) ss.:
STATE OF CONNECTICUT, )
66
<PAGE> 73
On this day of August, 1997, before me personally appeared ,
to me known, who being by me duly sworn, did depose and say that (s)he resides
at
;
that (s)he is of RANK XEROX CAPITAL
(EUROPE) PLC, one of the corporations described in and which executed the
foregoing instrument; that (s)he knows the corporate seal of said corporation;
that the seal affixed to said instrument is such corporate seal; that it was so
affixed by authority of the Board of Directors of said corporation; and that
(s)he signed her/his name thereto by like authority.
---------------------------------
Notary Public
My Commission Expires
[NOTARIAL SEAL]
COUNTY OF NEW YORK )
) ss.:
STATE OF NEW YORK )
On this day of August, 1997, before me personally appeared , to
me known, who, being by me duly sworn, did depose and say that (s)he resides at
;
that (s)he is of , one of the corporations
described in and which executed the foregoing instrument; that (s)he knows the
corporate seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation; and that (s)he signed her/his name thereto by
like authority.
---------------------------------
Notary Public
My Commission Expires
[NOTARIAL SEAL]
67
<PAGE> 1
Exhibit 4(o)
AMENDED AND RESTATED
SUBSCRIPTION AGREEMENT
The Subscription Agreement made on 1st December, 1995, between Rank Xerox
Limited ("RXL") of Parkway, Marlow, Buckinghamshire SL7 1YL and its wholly-owned
U.K. subsidiary, Rank Xerox Capital (Europe) plc ("RX Capital") of Parkway,
Marlow, Buckinghamshire SL7 1YL, is being amended and restated by the parties as
of 18th April, 1997 (as amended and restated, the "Agreement").
The purpose of this Agreement is to set out the terms and conditions under which
RXL wishes to obligate itself to subscribe on demand by RX Capital for
additional ordinary shares in the share capital of RX Capital (the "Shares") in
return for the RX Capital undertakings contained herein; and
RX Capital wishes to obligate itself to issue the Shares upon receipt of the
consideration therefor herein provided.
NOW, THEREFORE, in consideration of the mutual covenants set forth below and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:
1. RX Capital shall be permitted, at any time or times when the aggregate par
value of the ordinary share capital, together with any related share premium, of
RX Capital held by RXL (the "RXL Shareholding") shall be less than an amount
(the "Required Amount") equal to twenty-five percent (25%) of RX Capital's
outstanding indebtedness (disregarding contingent liabilities) (the difference
between the Required Amount and the RXL Shareholding being expressed in Sterling
and referred to herein as the "Subscription Amount"), to serve written demand on
RXL requiring it to subscribe for additional Shares in the value of the
Subscription Amount, provided that upon the first exercise by RX Capital of its
right to serve written demand on RXL hereunder the Subscription Amount shall
equal the Required Amount (and shall not be reduced by the amount of the RXL
Shareholding). Each demand shall state the Subscription Amount, giving
reasonable details of how the same is calculated, and shall be signed by two
directors of RX Capital. Upon the date specified in the demand (which shall be
not less than two business days' thereafter) RXL shall pay the Subscription
Amount in cash (the "Subscription Date").
2. Upon payment of the Subscription Amount, RX Capital hereby agrees to issue at
par such number of Shares as shall be equivalent to the Subscription Amount.
3. RX Capital hereby agrees to continue to act as the financing vehicle for
RXL and its Subsidiaries.
4. This Agreement shall not be terminated or amended or modified in a manner
materially prejudicial to RX Capital at any time when RX Capital has outstanding
any indebtedness for borrowed money to parties other than Xerox Corporation or
entities controlled by Xerox Corporation ("Debt").
5. The parties further agree that the holders from time to time of Debt are
intended to be beneficiaries ("Third Party Beneficiaries") of this Agreement.
Such Third Party Beneficiaries will have the right, under the terms and
conditions of the Debt, to require RX Capital to serve on RXL a demand requiring
it to subscribe for the Shares and pay the Subscription Amount, at
<PAGE> 2
such time as there is a default in the performance by RX Capital of its
obligations to pay the principal of, premium, if any, or interest on the Debt.
6. For the purpose of determining the Subscription Amount, any outstanding
indebtedness of RX Capital which is not denominated in Sterling shall be
notionally converted into Sterling at the spot exchange rates prevailing at
11:00 a.m. on the second London business day prior to the Subscription Date.
7. This Agreement shall be binding upon, and inure to the mutual benefit of, RXL
and its successors and RX Capital and its successors.
8. This Agreement shall be governed by and construed in accordance with the
laws of England and Wales.
IN WITNESS WHEREOF this Agreement has been executed by the parties hereto as of
the date above written.
Signed Signed Signed
For and on behalf of For and on behalf of For and on behalf of
Rank Xerox Limited Rank Xerox (Capital) Xerox Overseas
Europe plc Holdings plc
by ___________________ by ___________________ by ___________________
Director Director Director
<PAGE> 1
Exhibit 4(p)
AMENDED AND RESTATED
SUBSCRIPTION AGREEMENT
The Subscription Agreement made on 1st December, 1995, between Rank Xerox
Limited ("RXL") of Parkway, Marlow, Buckinghamshire SL7 1YL and its wholly-owned
U.K. subsidiary, Rank Xerox Capital (Europe) plc ("RX Capital") of Parkway,
Marlow, Buckinghamshire SL7 1YL, was amended and restated by the parties as of
18th April, 1997, and is being further amended and restated by the parties and
by Xerox Overseas Holdings plc ("XOH") as of 1997 (as amended and restated, the
"Agreement").
The purpose of this Agreement is to set out the terms and conditions under which
RXL or XOH (based on which of them shall at the relevant time be the majority
shareholder of RX Capital) wishes to obligate itself to subscribe on demand by
RX Capital for additional ordinary shares in the share capital of RX Capital
(the "Shares") in return for the RX Capital undertakings contained herein.
RX Capital wishes to obligate itself to issue the Shares upon receipt of the
consideration therefor herein provided.
References herein to the "Relevant Shareholder" shall (except where the context
otherwise requires) be to RXL or XOH, based on which of them shall at the time
any demand is served under Clause 1 be the majority shareholder of RX Capital.
NOW, THEREFORE, in consideration of the mutual covenants set forth below and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:
1. RX Capital shall be permitted, at any time or times when the aggregate par
value of the ordinary share capital, together with any related share premium, of
RX Capital held by the Relevant Shareholder (the "Relevant Shareholding") shall
be less than an amount (the "Required Amount") equal to twenty-five percent
(25%) of RX Capital's outstanding indebtedness (disregarding contingent
liabilities) (the difference between the Required Amount and the Relevant
Shareholding being expressed in Sterling and referred to herein as the
"Subscription Amount"), to serve written demand on the Relevant Shareholder
requiring it to subscribe for additional Shares in the value of the Subscription
Amount, provided that upon the first exercise by RX Capital of its right to
serve written demand on the Relevant Shareholder hereunder the Subscription
Amount shall equal the Required Amount (and shall not be reduced by the amount
of the Relevant Shareholding). Each demand shall state the Subscription Amount,
giving reasonable details of how the same is calculated, and shall be signed by
two directors of RX Capital. Upon the date specified in the demand (which shall
be not less than two business days' thereafter) the Relevant Shareholder shall
pay the Subscription Amount in cash (the "Subscription Date").
2. Upon payment of the Subscription Amount, RX Capital hereby agrees to issue at
par such number of Shares as shall be equivalent to the Subscription Amount.
3. RX Capital hereby agrees to continue to act as the financing vehicle for
XOH and its Subsidiaries.
<PAGE> 2
4. This Agreement shall not be terminated or amended or modified in a manner
materially prejudicial to RX Capital at any time when RX Capital has outstanding
any indebtedness for borrowed money to parties other than Xerox Corporation or
entities controlled by Xerox Corporation ("Debt").
5. The parties further agree that the holders from time to time of Debt are
intended to be beneficiaries ("Third Party Beneficiaries") of this Agreement.
Such Third Party Beneficiaries will have the right, under the terms and
conditions of the Debt, to require RX Capital to serve on the Relevant
Shareholder a demand requiring it to subscribe for the Shares and pay the
Subscription Amount, at such time as there is a default in the performance by RX
Capital of its obligations to pay the principal of, premium, if any, or interest
on the Debt.
6. For the purpose of determining the Subscription Amount, any outstanding
indebtedness of RX Capital which is not denominated in Sterling shall be
notionally converted into Sterling at the spot exchange rates prevailing at
11:00 a.m. on the second London business day prior to the Subscription Date.
7. This Agreement shall be binding upon, and inure to the mutual benefit of,
RXL, XOH and their successors and RX Capital and its successors.
8. This Agreement shall be governed by and construed in accordance with the
laws of England and Wales.
IN WITNESS WHEREOF this Agreement has been executed by the parties hereto as of
the date above written.
Signed Signed Signed
For and on behalf of For and on behalf of For and on behalf of
Rank Xerox Limited Rank Xerox (Capital) Xerox Overseas
Europe plc Holdings plc
by ___________________ by ___________________ by ___________________
Director Director Director
<PAGE> 1
EXHIBIT 5(A)
Xerox Corporation
P.O. Box 1600
Stamford, Connecticut 06904-1600
203-968-3000
Office of General Counsel
Martin S. Wagner
Associate General Counsel,
Corporate, Finance and Ventures
August 25, 1997
Xerox Corporation
P.O. Box 1600
Stamford, Connecticut 06904-1600
Gentlemen:
As Associate General Counsel, Corporate, Finance and Ventures of Xerox
Corporation, I am familiar with the Registration Statement on Form S-3 filed
under the Securities Act of 1933, as amended ("Registration Statement"),
relating to the proposed offering and sale from time to time by Xerox
Corporation, a New York corporation ("Company"), Xerox Overseas Holdings PLC
("Xerox Overseas") and Rank Xerox Capital (Europe) plc ("Xerox Capital", and
together with Xerox Overseas, the "Subsidiary Issuers", and the Subsidiary
Issuers collectively with the Company, the "Issuer") of debt securities ("Debt
Securities") from which the Issuers may receive an aggregate of up to
$2,000,000,000 of proceeds and which will be offered on terms to be determined
at the time of sale. Debt Securities of the Subsidiary Issuers will be
irrevocably and unconditionally guaranteed by the Company (in such capacity, the
"Guarantor") pursuant to the Indenture referred to below (the "Guarantees"). In
rendering the opinions set forth herein, either I or other attorneys in the
Office of General Counsel of the Company who report either directly or
indirectly to me have examined an Indenture among the Issuers, the Guarantor and
Citibank, N.A., as Trustee, substantially in the form filed as an exhibit to the
Registration Statement (the "Indenture"), under which the Debt Securities are to
be issued, the Company's certificate of incorporation and by-laws, each as
amended to date, certain minutes of meetings of the Board of Directors of the
Company and such other documents and matters of law as have been considered
necessary or desirable in rendering the opinions set forth herein.
Based upon the foregoing, it is my opinion that:
1. The Company has been duly incorporated and is validly existing in good
standing under the laws of New York.
2. The Debt Securities, when duly authorized by appropriate corporate action and
duly executed and authenticated, and when issued and delivered against
payment therefor as described in the Registration Statement and a Prospectus
Supplement, will be legally issued and validly and legally binding
obligations of the applicable Issuer and such Debt Securities will be
entitled to the benefits of the Indenture under which they are issued.
3. The Guarantees, when duly authorized by appropriate corporate action and duly
executed and delivered, and when the Debt Securities to which such Guarantees
relate have been duly authorized by appropriate corporate action and duly
executed, authenticated, issued and delivered against payment therefor as
described in the Registration Statement and a Prospectus Supplement, will be
the legal, valid and binding obligations of the Company and such Guarantees
will be entitled to the benefits of the Indenture under which they are
issued.
I consent to the reference to my name under the caption "Legal Opinions" in the
Prospectus contained in the Registration Statement and to the filing of this
letter as an exhibit to the Registration Statement.
Very truly yours,
MARTIN S. WAGNER
Associate General Counsel,
Corporate, Finance and Ventures
<PAGE> 1
Exhibit 5(b)
[LETTERHEAD OF CAROLE SHEPHARD]
25 August, 1997
Xerox Overseas Holdings plc
Parkway
Marlow
Buckinghamshire SL7 1YL
Rank Xerox Capital (Europe) plc
Parkway
Marlow
Buckinghamshire SL7 1YL
Dear Sirs,
I am the Company Secretary of Rank Xerox Limited, a private limited company
incorporated under the laws of England and Wales("Rank Xerox Limited"), and a
Barrister in England and have acted as English legal adviser to Xerox Overseas
Holdings plc ("Xerox Overseas") and Rank Xerox Capital (Europe) plc ("Xerox
Capital" and, together with Xerox Overseas, the "Subsidiary Issuers"), each a
public limited company incorporated under the laws of England and Wales, in
connection with the preparation and filing under the United States Securities
Act of 1933, as amended, by the Subsidiary Issuers and Xerox ("Xerox" and,
collectively with the Subsidiary Issuers, the "Issuers") of a Form S-3
Registration Statement (the "Registration Statement") relating to the proposed
offering and sale from time to time by the Issuers of debt securities ("Debt
Securities") from which the Issuers may receive up to an aggregate of
$2,000,000,000 of proceeds. Debt Securities of the Subsidiary Issuers will be
issued under an Indenture among the Issuers, Xerox, as guarantor (the
"Guarantor"), and Citibank, N.A., as trustee, substantially in the form filed as
an exhibit to the Registration Statement (the "Indenture"), and will be
irrevocably and unconditionally guaranteed by the Guarantor.
In rendering the opinions set forth herein, I have examined (i) the Prospectus
and Prospectus Supplement filed as part of the Registration Statement
(collectively, the "Prospectus"), (ii) the Indenture, (iii) the draft of the
Selling Agency Agreement pursuant to which the Debt Securities will be offered
and sold (the "Selling Agency Agreement"), (iv) the Amended and Restated
Subscription Agreement dated as of 18th April 1997 between Rank Xerox Limited
and Xerox Capital (the "Original Subscription Agreement"), (v) the Amended and
Restated Subscription Agreement to be entered into among Rank Xerox Limited,
Xerox Overseas and Xerox Capital, substantially in the form filed as an exhibit
to the Registration Statement (the "Proposed Subscription Agreement" and,
collectively with the Indenture, the Selling Agency Agreement and the Original
Subscription Agreement, the "Relevant Agreements"), (vi) the Memorandum and
Articles of Association of each of the Subsidiary Issuers, each as amended to
date and (vii) certain minutes of meetings of the Board of Directors of each of
the Subsidiary Issuers and Rank Xerox Limited. In addition, I have examined
originals or copies, certified or otherwise identified to my satisfaction, of
such other agreements, instruments, certificates of public officials and
corporate officers of Rank Xerox Limited and Subsidiary Issuers and such other
documents, certificates, records, authorizations and
<PAGE> 2
proceedings as I deemed requisite to enable me to express the opinions
hereinafter set forth.
This opinion is limited to English law as presently applied by the English
courts and is given on the basis that it will be governed by and construed in
accordance with English law. I have made no investigation of the laws of any
jurisdiction other than England and neither express nor imply any opinion as to
any other laws and in particular the laws of the State of New York and the
United States of America.
Based upon the foregoing, it is my opinion that:
1. Each of the Subsidiary Issuers has been duly incorporated and is validly
existing as a public limited company under English law with power and authority
to conduct the business carried on by it as described in the Prospectus; and
Rank Xerox Limited has been duly incorporated and is validly existing as a
private limited company under English law with power and authority to carry on
the business carried on by it as described in the Prospectus;
2. Each of the Subsidiary Issuers has the corporate power to execute and deliver
the Relevant Agreements to which it is a party and perform its obligations
thereunder, to issue and deliver against payment therefor as described in the
Prospectus the Debt Securities and perform its obligations thereunder, and to
submit to the jurisdiction of any United States or New York State court in the
Borough of Manhattan, The City of New York, New York and to appoint Xerox as its
respective authorised agent for the purposes and to the extent described in the
Indenture;
3. Rank Xerox Limited has the corporate power to execute and deliver the
Relevant Agreements to which it is a party and perform its obligations
thereunder;
4. When (i) the Indenture has been duly authorised by appropriate corporate
action and executed by each of the parties thereto, (ii) the terms of the Debt
Securities and their issuance and sale have been duly established in conformity
with the Indenture so as not to violate any applicable law of any jurisdiction
(not being England and Wales), and (iii) the Debt Securities have been duly
authorised by appropriate corporate action and duly issued in accordance with
the Indenture and duly delivered to and paid for by the purchasers thereof, the
Debt Securities will, insofar as English law is concerned, constitute valid and
binding obligations of the applicable Subsidiary Issuer, enforceable against it
in accordance with their respective terms;
5. The Original Subscription Agreement has been duly authorised, executed and
delivered by the parties thereto and constitutes valid and binding obligations
of each such party, enforceable against it in accordance with its terms; and
6. When the Proposed Subscription Agreement has been duly authorised by
appropriate corporate action and executed by each of the parties thereto, the
Proposed Subscription Agreement will constitute valid and binding obligations of
each such party, enforceable against it in accordance with its terms.
The expression "enforceable" as used in paragraphs 4, 5 and 6 above means that
the obligations of each of the Subsidiary Issuers and Rank Xerox Limited created
by the Relevant Agreements to which it is a party are of a type which English
courts enforce. It does not mean that those obligations will
<PAGE> 3
necessarily be enforced in all circumstances in accordance with their terms.
In particular (without limitation):
(i) enforcement may be limited by applicable bankruptcy, insolvency,
liquidation, reorganisation and other laws or principles of equity or public
policy from time to time in force, in each case affecting the rights of
creditors generally;
(ii) the power of a court to order certain equitable remedies, such as an
injunction or specific performance, is discretionary and an English court may in
its discretion make an award of damages where this is considered an adequate
remedy;
(iii) enforcement of obligations may become time barred by statute or may be or
become subject to defences of set-off or counter-claim depending on the
circumstances;
(iv) where obligations are to be performed or observed in jurisdictions outside
England and Wales, or by a person subject to the laws of a jurisdiction outside
England and Wales, they may not be enforceable under English law to the extent
that performance or observance would be illegal or contrary to public policy
under the laws of any such jurisdiction or by virtue of any international treaty
to which England is a party; and
(v) any person who is not a party to an agreement may not be able to enforce any
provisions of that agreement which are expressed to be for the benefit of that
person.
I consent to the reference to my name under the caption "Legal Opinions" in the
Prospectus and to the filing of this letter as an exhibit to the Registration
Statement.
Yours faithfully
CAROLE SHEPHARD
Company Secretary and Barrister
<PAGE> 1
EXHIBIT 5(C)
August 25, 1997
<TABLE>
<S> <C> <C>
Xerox Corporation Xerox Overseas Holdings plc Rank Xerox Capital (Europe) plc
800 Long Ridge Road Parkway Parkway
P.O. Box 1600 Marlow Marlow
Stamford, CT 06904-1600 Buckinghamshire SL7 1YL Buckinghamshire SL7 1YL
England England
</TABLE>
Gentlemen:
We have acted as special U.S. tax counsel for Xerox Corporation (the
"Company"), Xerox Overseas Holdings PLC ("Xerox Overseas") and Rank Xerox
Capital (Europe) plc ("Xerox Capital", and collectively with the Company and
Xerox Overseas, the "Issuers") in connection with the preparation and filing
under the Securities Act of 1933, as amended, of the Registration Statement on
Form S-3 (the "Registration Statement") relating to the proposed offering and
sale from time to time by the Issuers of debt securities ("Debt Securities")
from which the Issuers may receive up to an aggregate of $2,000,000,000 of
proceeds and which will be issued under an indenture among the Company, Xerox
Overseas, Xerox Capital and Citibank, N.A., as trustee, substantially in the
form filed as an exhibit to the Registration Statement (the "Indenture"). Debt
Securities of Xerox Overseas and Xerox Capital will be irrevocably and
unconditionally guaranteed by the Company pursuant to the Indenture.
It is our opinion that if the offer and sale of the Debt Securities is
conducted in the manner described in the Prospectus (the "Prospectus") and the
Prospectus Supplement (the "Prospectus Supplement") filed as part of the
Registration Statement and if the terms of Debt Securities are as contemplated
by the Prospectus and Prospectus Supplement, then the statements under the
caption "United States Taxation" in the Prospectus Supplement (the "Tax
Section") correctly describe certain United States Federal income tax
consequences resulting from the purchase, ownership and disposition of Debt
Securities by an initial holder thereof subject to United States income
taxation. As described in the Tax Section, United States Federal income tax
consequences with respect to Debt Securities having certain terms will be set
forth in the pricing supplement to the Prospectus Supplement relating to the
offer and sale of such Debt Securities.
We do not purport to be expert in, or to express any opinion concerning,
the laws of any jurisdiction other than the Federal laws of the United States.
We hereby consent to the reference to us and to the use of our name under
the caption "Legal Opinions" in the Prospectus and the caption "United States
Taxation" in the Prospectus Supplement, and to the filing of a copy of this
opinion as an exhibit to the Registration Statement.
Very truly yours,
IVINS, PHILLIPS & BARKER, CHARTERED
<PAGE> 1
EXHIBIT 12
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES OF THE COMPANY
(IN MILLIONS)
<TABLE>
<CAPTION>
SIX MONTHS
ENDED JUNE 30, YEAR ENDED DECEMBER 31,
--------------- -----------------------------------------
1997 1996 1996 1995 1994 1993* 1992
------ ------ ------ ------ ------ ----- ------
<S> <C> <C> <C> <C> <C> <C> <C>
Fixed charges:
Interest expense................. $ 288 $ 295 $ 592 $ 603 $ 520 $ 540 $ 627
Rental expense................... 60 74 140 142 170 180 187
Preferred stock dividend of
subsidiary.................... 23 -- -- -- -- -- --
------ ------ ------ ------ ------ ----- ------
Total fixed charges before
capitalized interest and
preferred stock dividend of
subsidiary.................. 371 369 732 745 690 720 814
Capitalized interest............. -- -- -- -- 2 5 17
------ ------ ------ ------ ------ ----- ------
Total fixed charges........... $ 371 $ 369 $ 732 $ 745 $ 692 $ 725 $ 831
====== ====== ====== ====== ====== ====== ======
Earnings available for fixed
charges:
Earnings**....................... $ 993 $ 905 $2,067 $1,980 $1,602 $(193) $1,183
Less undistributed income in
minority owned companies...... (65) (62) (84) (90) (54) (51) (52)
Add fixed charges before
capitalized interest.......... 348 369 732 745 690 720 814
------ ------ ------ ------ ------ ----- ------
Total earnings available for
fixed charges............... $1,276 $1,212 $2,715 $2,635 $2,238 $ 476 $1,945
====== ====== ====== ====== ====== ====== ======
Ratio of earnings to fixed
charges (1)(2)................... 3.44 3.28 3.71 3.54 3.23 0.66 2.34
</TABLE>
- ---------------
(1) The ratio of earnings to fixed charges has been computed based on Xerox'
continuing operations by dividing total earnings available for fixed
charges, excluding capitalized interest, by total fixed charges. Fixed
charges consist of interest, including capitalized interest, one-third of
rent expense as representative of the interest portion of rentals, and
preferred stock dividend requirements of subsidiaries. Debt has been
assigned to discontinued operations based on historical levels assigned to
the businesses when they were continuing operations, adjusted for subsequent
paydowns. Discontinued operations consist of Xerox' Insurance and Other
Financial Services businesses and its real-estate development and
third-party financing businesses.
(2) Xerox' ratio of earnings to fixed charges includes the effect of Xerox'
finance subsidiaries which primarily finance Xerox equipment. Financing
businesses are more highly leveraged and, therefore, tend to operate at
lower earnings to fixed charges ratio levels than do non-financial
businesses.
* 1993 earnings were inadequate to cover fixed charges. The coverage
deficiency was $249 million.
** Sum of "Income (Loss) before Income Taxes, Equity Income and Minorities'
Interests" and "Equity in Net Income of Unconsolidated Affiliates."
<PAGE> 1
EXHIBIT 24(A)
CERTIFICATE
I, Martin S. Wagner, Assistant Secretary of Xerox Corporation, a New York
corporation (the "Company"), DO HEREBY CERTIFY that Exhibit A is a true and
correct copy of a resolution duly adopted at a meeting of the Board of Directors
of the Company duly held and convened on May 16, 1996, at which meeting a duly
constituted quorum of the Board of Directors was present and acting throughout
and that such resolution has not been modified, rescinded or revoked and is at
present in full force and effect.
IN WITNESS WHEREOF, the undersigned has executed this Certificate and
affixed the corporate seal of the Company hereto this 25th day of August, 1997.
MARTIN S. WAGNER
MARTIN S. WAGNER
ASSISTANT SECRETARY
---------------------
EXHIBIT A
RESOLVED: that each officer and director of the Company who may be required
to execute the Registration Statements or any amendment thereto (whether on
behalf of the Company or as an officer or director thereof) be and hereby is
authorized to execute a power of attorney appointing E. M. Filter, G.R. Roth and
M. S. Wagner, and each of them, as true and lawful attorneys and agents to
execute in his or her name, place and stead (in any such capacity) the
Registration Statements and any and all amendments thereto, and any and all
documents in connection therewith, and to file the same, in electronic or paper
form, with the SEC, each of said attorneys and agents to have power to act with
or without the other and to have the full power and authority to do and perform
in the name and on behalf of each of said officers and directors, or both, as
the case may be, every act whatsoever necessary or advisable to be done in the
premises as fully and to all intents and purposes as any such officer or
director might or could do in person.
<PAGE> 1
EXHIBIT 24(B)
CERTIFICATE
I, Carole Shephard, Company Secretary of Xerox Overseas Holdings PLC
("Xerox Overseas") and Rank Xerox Capital (Europe) plc ("Xerox Capital"), DO
HEREBY CERTIFY that Exhibit A is a true and correct copy of resolutions duly
adopted at meetings of the Board of Directors of Xerox Overseas and Xerox
Capital duly held and convened on July 21, 1997, and that such resolutions have
not been modified, rescinded or revoked and are at present in full force and
effect.
IN WITNESS WHEREOF, the undersigned has executed this Certificate this 25th
day of August, 1997.
CAROLE SHEPHARD
CAROLE SHEPHARD
COMPANY SECRETARY
---------------------
EXHIBIT A
XEROX OVERSEAS HOLDINGS PLC
RESOLVED: that each officer and director of the Company who may be required
to execute the Registration Statements or any amendment thereto (whether on
behalf of the Company or as an officer or director thereof) be and hereby is
authorized to execute a power of attorney appointing E. M. Filter, G.R. Roth and
M. S. Wagner, and each of them, as true and lawful attorneys and agents to
execute in his or her name, place and stead (in any such capacity) the
Registration Statements and any and all amendments thereto, and any and all
documents in connection therewith, and to file the same, in electronic or paper
form, with the SEC, each of said attorneys and agents to have power to act with
or without the other and to have the full power and authority to do and perform
in the name and on behalf of each of said officers and directors, or both, as
the case may be, every act whatsoever necessary or advisable to be done in the
premises as fully and to all intents and purposes as any such officer or
director might or could do in person.
RANK XEROX CAPITAL (EUROPE) PLC
RESOLVED: that each officer and director of the Company who may be required
to execute the Registration Statements or any amendment thereto (whether on
behalf of the Company or as an officer or director thereof) be and hereby is
authorized to execute a power of attorney appointing E. M. Filter, G.R. Roth and
M. S. Wagner, and each of them, as true and lawful attorneys and agents to
execute in his or her name, place and stead (in any such capacity) the
Registration Statements and any and all amendments thereto, and any and all
documents in connection therewith, and to file the same, in electronic or paper
form, with the SEC, each of said attorneys and agents to have power to act with
or without the other and to have the full power and authority to do and perform
in the name and on behalf of each of said officers and directors, or both, as
the case may be, every act whatsoever necessary or advisable to be done in the
premises as fully and to all intents and purposes as any such officer or
director might or could do in person.
<PAGE> 1
EXHIBIT 24(C)
POWER OF ATTORNEY
XEROX CORPORATION (THE "COMPANY") AND EACH PERSON WHOSE SIGNATURE APPEARS
BELOW AUTHORIZE EACH OF EUNICE M. FILTER, GEORGE R. ROTH AND MARTIN S. WAGNER
(EACH AN "APPOINTEE") TO FILE, EITHER IN PAPER OR ELECTRONIC FORM, FROM TIME TO
TIME ONE OR MORE REGISTRATION STATEMENTS AND AMENDMENTS THERETO (INCLUDING
POST-EFFECTIVE AMENDMENTS), UNDER THE SECURITIES ACT OF 1933, AS AMENDED, FOR
THE PURPOSE OF REGISTERING THE OFFERING AND SALE OF AN UNLIMITED AMOUNT OF DEBT
SECURITIES OF THE COMPANY, WHICH REGISTRATION STATEMENTS AND AMENDMENTS SHALL
CONTAIN SUCH INFORMATION AND EXHIBITS AS ANY SUCH APPOINTEE DEEMS ADVISABLE.
EACH SUCH PERSON HEREBY APPOINTS EACH APPOINTEE AS ATTORNEY-IN-FACT, WITH FULL
POWER TO ACT ALONE, TO EXECUTE ANY SUCH REGISTRATION STATEMENTS AND ANY AND ALL
AMENDMENTS THERETO AND ANY AND ALL OTHER DOCUMENTS IN CONNECTION THEREWITH, IN
THE NAME OF AND ON BEHALF OF THE COMPANY AND EACH SUCH PERSON, INDIVIDUALLY AND
IN EACH CAPACITY STATED BELOW, INCLUDING THE POWER TO ENTER ELECTRONICALLY SUCH
COMPANY IDENTIFICATION NUMBERS, PASSWORDS AND OTHER INFORMATION AS MAY BE
REQUIRED TO EFFECT SUCH FILING AS PRESCRIBED UNDER THE RULES AND REGULATIONS OF
THE SECURITIES AND EXCHANGE COMMISSION (THE "SEC"), AND TO FILE, EITHER IN PAPER
OR ELECTRONIC FORM, WITH THE SEC A FORM OF THIS POWER OF ATTORNEY. EACH SUCH
PERSON INDIVIDUALLY AND IN SUCH CAPACITIES STATED BELOW HEREBY GRANTS TO SAID
ATTORNEYS-IN-FACT, AND EACH OF THEM, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING WHATSOEVER THAT SAID ATTORNEY OR ATTORNEYS MAY DEEM
NECESSARY OR ADVISABLE TO CARRY OUT FULLY THE INTENT OF THE FOREGOING AS THE
UNDERSIGNED MIGHT OR COULD DO PERSONALLY OR IN THE CAPACITIES AS AFORESAID.
XEROX CORPORATION
Dated as of September 17, 1996
By: /s/ PAUL A. ALLAIRE
------------------------------------
PAUL A. ALLAIRE
CHAIRMAN OF THE BOARD AND CHIEF
EXECUTIVE OFFICER
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ----------------------------------- ----------------------------------------
<S> <C> <C>
/s/ PAUL A. ALLAIRE Chairman of the Board, Chief Executive Officer and Director
- ------------------------- (Principal Executive Officer)
PAUL A. ALLAIRE
/s/ BARRY D. ROMERIL Executive Vice President and Chief Financial Officer
- ------------------------- (Principal Financial Officer)
BARRY D. ROMERIL
/s/ PHILIP D. FISHBACH Vice President and Controller
- ------------------------- (Principal Accounting Officer)
PHILIP D. FISHBACH
/s/ B.R. INMAN Director
- --------------------------
B.R. INMAN
/s/ ANTONIA AX:SON JOHNSON Director
- ---------------------------
ANTONIA AX:SON JOHNSON
/s/ VERNON E. JORDAN, JR. Director
- ---------------------------
VERNON E. JORDAN, JR.
</TABLE>
<PAGE> 2
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ----------------------------------- ----------------------------------------
<S> <C>
/s/ YOTARO KOBAYASHI Director
- ---------------------------
YOTARO KOBAYASHI
/s/ HILMAR KOPPER Director
- ---------------------------
HILMAR KOPPER
/s/ RALPH S. LARSEN Director
- ---------------------------
RALPH S. LARSEN
/s/ JOHN D. MACOMBER Director
- --------------------------
JOHN D. MACOMBER
/s/ GEORGE J. MITCHELL Director
- ---------------------------
GEORGE J. MITCHELL
/s/ N. J. NICHOLAS, JR. Director
- ----------------------------
N. J. NICHOLAS, JR.
/s/ JOHN E. PEPPER Director
- ----------------------------
JOHN E. PEPPER
/s/ MARTHA R. SEGER Director
- ----------------------------
MARTHA R. SEGER
/s/ THOMAS C. THEOBALD Director
- -----------------------------
THOMAS C. THEOBALD
</TABLE>
<PAGE> 1
EXHIBIT 24(d)
POWER OF ATTORNEY
Xerox Overseas Holdings Plc (the "Company") and each person whose signature
appears below authorize each of Eunice M. Filter, George R. Roth and Martin S.
Wagner (each an "appointee") to file, either in paper or electronic form, from
time to time one or more registration statements and amendments thereto
(including post-effective amendments), under the Securities Act of 1933, as
amended, for the purpose of registering the offering and sale of an unlimited
amount of debt securities of the Company, which registration statements and
amendments shall contain such information and exhibits as any such appointee
deems advisable. Each such person hereby appoints each appointee as
attorney-in-fact, with full power to act alone, to execute any such registration
statements and any and all amendments thereto and any and all other documents in
connection therewith, in the name of and on behalf of the Company and each such
person, individually and in each capacity stated below, including the power to
enter electronically such company identification numbers, passwords and other
information as may be required to effect such filing as prescribed under the
rules and regulations of the Securities and Exchange Commission (the "SEC"), and
to file, either in paper or electronic form, with the SEC a form of this Power
of Attorney. Each such person individually and in such capacities stated below
hereby grants to said attorneys-in-fact, and each of them, full power and
authority to do and perform each and every act and thing whatsoever that said
attorney or attorneys may deem necessary or advisable to carry out fully the
intent of the foregoing as the undersigned could do personally or in the
capacities as aforesaid.
EXECUTED AS A DEED BY XEROX OVERSEAS HOLDINGS PLC ACTING BY
Dated as of 21 July, 1997 By: /s/ DAVID N. MAW
------------------------------------
David N. Maw
Director
/s/ CAROLE SHEPHARD
------------------------------------
Carole Shephard
Director
<TABLE>
<C> <S>
/s/ BERNARD D FOURNIER Director
- --------------------------------------------- (Principal Executive)
(Bernard D Fournier)
/s/ PATRICK H PONCHON Director
- --------------------------------------------- (Principal Financial and Accounting Officer)
(Patrick H Ponchon)
/s/ CHARLES P. GILLIAM Director
- ---------------------------------------------
(Charles P. Gilliam)
/s/ RUSSELL Y. OKASAKO Director
- ---------------------------------------------
(Russell Y. Okasako)
</TABLE>
<PAGE> 2
<TABLE>
<C> <S>
/s/ EUNICE M. FILTER Director
- ---------------------------------------------
(Eunice M. Filter)
/s/ DAVID N. MAW Director
- ---------------------------------------------
(David N. Maw)
/s/ RUSSELL Y. OKASAKO Director
- ---------------------------------------------
(Russell Y. Okasako)
/s/ CAROLE SHEPHARD Director
- ---------------------------------------------
(Carole Shephard)
</TABLE>
<PAGE> 1
EXHIBIT 24(e)
POWER OF ATTORNEY
Rank Xerox Capital (Europe) plc (the "Company") and each person whose
signature appears below authorize each of Eunice M. Filter, George R. Roth and
Martin S. Wagner (each an "appointee") to file, either in paper or electronic
form, from time to time one or more registration statements and amendments
thereto (including post-effective amendments), under the Securities Act of 1933,
as amended, for the purpose of registering the offering and sale of an unlimited
amount of debt securities of the Company, which registration statements and
amendments shall contain such information and exhibits as any such appointee
deems advisable. Each such person hereby appoints each appointee as attorney-
in-fact, with full power to act alone, to execute any such registration
statements and any and all amendments thereto and any and all other documents in
connection therewith, in the name of and on behalf of the Company and each such
person, individually and in each capacity stated below, including the power to
enter electronically such company identification numbers, passwords and other
information as may be required to effect such filing as prescribed under the
rules and regulations of the Securities and Exchange Commission (the "SEC"), and
to file, either in paper or electronic form, with the SEC a form of this Power
of Attorney. Each such person individually and in such capacities stated below
hereby grants to said attorneys-in-fact, and each of them, full power and
authority to do and perform each and every act and thing whatsoever that said
attorney or attorneys may deem necessary or advisable to carry out fully the
intent of the foregoing as the undersigned could do personally or in the
capacities as aforesaid.
EXECUTED AS A DEED BY RANK XEROX CAPITAL (EUROPE) PLC ACTING BY
Dated as of 21 July, 1997 By: /s/ P. H. PONCHON
------------------------------------
P. H. Ponchon
Director
/s/ D. N. MAW
------------------------------------
D. N. Maw
Director
<TABLE>
<S> <C>
/s/ B. D. FOURNIER Director
- ----------------------------------- (Principal Executive)
(B. D. Fournier)
/s/ P. H. PONCHON Director
- ----------------------------------- (Principal Financial and Accounting Officer)
(P. H. Ponchon)
/s/ D. N. MAW Director
- -----------------------------------
(D. N. Maw)
/s/ E. M. FILTER Director
- -----------------------------------
(E. M. Filter)
</TABLE>
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an application to determine eligibility of a Trustee
pursuant to Section 305 (b)(2) ____
------------------------
CITIBANK, N.A.
(Exact name of trustee as specified in its charter)
13-5266470
(I.R.S. employer
identification no.)
399 Park Avenue, New York, New York 10043
(Address of principal executive office) (Zip Code)
-----------------------
XEROX CORPORATION
(Exact name of obligor as specified in its charter)
New York 16-0468020
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
P. O. Box 1600
Stamford, Connecticut 06904-1600
(Address of principal executive offices) (Zip Code)
XEROX OVERSEAS HOLDINGS PLC
(Exact name of obligor as specified in its charter)
United Kingdom N/A
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Parkway
Marlow
Buckinghamshire England SL7 1YL
(Address of principal executive offices) (Zip Code)
RANK XEROX CAPITAL (EUROPE) PLC
(Exact name of obligor as specified in its charter)
United Kingdom N/A
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Parkway
Marlow
Buckinghamshire England SL7 1YL
(Address of principal executive offices) (Zip Code)
-------------------------
Debt Securities
(Title of the indenture securities)
<PAGE> 2
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
<TABLE>
<CAPTION>
Name Address
---- -------
<S> <C> <C>
Comptroller of the Currency Washington, D.C.
Federal Reserve Bank of New York New York, NY
33 Liberty Street
New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
</TABLE>
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each
such affiliation.
None.
Item 16. List of Exhibits.
List below all exhibits filed as a part of this Statement of
Eligibility.
Exhibits identified in parentheses below, on file with the
Commission, are incorporated herein by reference as exhibits
hereto.
Exhibit 1 - Copy of Articles of Association of the Trustee, as
now in effect. (Exhibit 1 to T-1 to Registration Statement No.
2-79983)
Exhibit 2 - Copy of certificate of authority of the Trustee to
commence business. (Exhibit 2 to T-1 to Registration Statement
No. 2-29577).
Exhibit 3 - Copy of authorization of the Trustee to exercise
corporate trust powers. (Exhibit 3 to T-1 to Registration
Statement No. 2-55519)
Exhibit 4 - Copy of existing By-Laws of the Trustee. (Exhibit
4 to T-1 to Registration Statement No. 33-34988)
Exhibit 5 - Not applicable.
Exhibit 6 - The consent of the Trustee required by Section
321(b) of the Trust Indenture Act of 1939. (Exhibit 6 to T-1
to Registration Statement No. 33- 19227.)
Exhibit 7 - Copy of the latest Report of Condition of
Citibank, N.A. (as of March 31, 1997 - attached)
<PAGE> 3
Exhibit 8 - Not applicable.
Exhibit 9 - Not applicable.
------------------
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, Citibank, N.A., a national banking association organized and existing
under the laws of the United States of America, has duly caused this statement
of eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in The City of New York and State of New York, on the 22nd day
of August, 1997.
CITIBANK, N.A.
By /s/Wafaa Orfy
--------------------------------------
Wafaa Orfy
Senior Trust Officer
<PAGE> 4
Charter No. 1461
Comptroller of the Currency
Northeastern District
REPORT OF CONDITION
CONSOLIDATING
DOMESTIC AND FOREIGN
SUBSIDIARIES OF
CITIBANK, N.A.
of New York in the State of New York, at the close of business on March 31,
1997, published in response to call made by Comptroller of the Currency, under
Title 12, United States Code, Section 161. Charter Number 1461 Comptroller of
the Currency Northeastern District.
ASSETS
<TABLE>
<CAPTION>
THOUSANDS
OF DOLLARS
<S> <C>
Cash and balances due from
depository institutions:
Noninterest-bearing balances
and currency and coin .............................. $ 6,045,000
Interest-bearing balances ................................... 13,753,000
Held-to-maturity securities ................................. 0
Available-for-sale securities ............................... 28,164,000
Federal funds sold and
securities purchased under
agreements to resell ............................... 8,655,000
Loans and lease financing receivables:
Loans and Leases, net of
unearned income .................... $144,695,000
LESS: Allowance for loan
and lease losses ................. 4,252,000
Loans and leases, net of unearned income, allowance,
and reserve ........................................ 140,443,000
Trading assets .............................................. 29,022,000
Premises and fixed assets (includ-
ing capitalized leases) ............................ 3,498,000
Other real estate owned ..................................... 788,000
Investments in unconsolidated
subsidiaries and associated
companies .......................................... 1,240,000
Customers' liability to this bank
on acceptances outstanding ......................... 2,196,000
Intangible assets ........................................... 145,000
Other assets ................................................ 8,018,000
------------
TOTAL ASSETS ................................................ $241,967,000
============
LIABILITIES
Deposits:
In domestic offices ................................ $ 35,600,000
Noninterest-
bearing .......................... $ 11,892,000
Interest-
bearing .......................... 23,708,000
------------
In foreign offices, Edge and
Agreement subsidiaries, and
IBFs ............................................... 133,267,000
Noninterest-
bearing .......................... 10,371,000
Interest-
bearing .......................... 122,896,000
------------
Federal funds purchased and
securities sold under
agreements to repurchase ........................... 6,959,000
Trading liabilities ......................................... 22,107,000
Other borrowed money (includes
mortgage indebtedness and
obligations under capitalized
leases):
With a remaining maturity of one
year or less ....................................... 7,949,000
With a remaining maturity of more
than one year ...................................... 3,273,000
Bank's liability on acceptances
executed and outstanding ........................... 2,239,000
Subordinated notes and
debentures .................................................. 4,700,000
Other liabilities ........................................... 9,267,000
------------
TOTAL LIABILITIES ........................................... $225,361,000
============
EQUITY CAPITAL
Perpetual preferred stock
and related surplus ................................ 0
Common stock ................................................ $ 751,000
Surplus ..................................................... 7,264,000
Undivided profits and capital
reserves ........................................... 8,619,000
Net unrealized holding gains (losses)
on available-for-sale securities ................... 582,000
Cumulative foreign currency
translation adjustments ............................ (610,000)
------------
TOTAL EQUITY CAPITAL ........................................ $ 16,606,000
============
TOTAL LIABILITIES, LIMITED-
LIFE PREFERRED STOCK, AND
EQUITY CAPITAL ..................................... $241,967,000
============
</TABLE>
I, Roger W. Trupin, Controller of the above-named bank do hereby declare that
this Report of Condition is true and correct to the best of my knowledge and
belief.
ROGER W. TRUPIN
CONTROLLER
We, the undersigned directors, attest to the correctness of this Report of
Condition. We declare that it has been examined by us, and to the best of our
knowledge and belief has been prepared in conformance with the instructions and
is true and correct.
PAUL J. COLLINS
JOHN S. REED
WILLIAM R. RHODES
DIRECTORS
