<PAGE> 1
EXHIBIT 4
US BANK TRUST NATIONAL ASSOCIATION
TRUSTEE
INDENTURE
DATED AS OF _________, 2000
VARIABLE DENOMINATION SUBORDINATED
FIXED RATE TERM NOTES
Reconciliation and Tie between Trust Indenture Act of 1939 and Indenture
<TABLE>
<CAPTION>
Trust Indenture Trust Indenture
Act Section Indenture Section Act Section Indenture Section
-------------- ----------------- --------------- -----------------
<S> <C> <C> <C>
Section 310 (a)(1) 609 Section 316 (a) 101
(a)(2) 609 (a)(a)(A) 502, 512
(a)(3) Not Applicable (a)(1)(B) 513
(a)(4) Not Applicable (a)(2) Not Applicable
(a)(5) 609 (b) 508
(b) 608 and 610 (c) 104(5)
Section 311 (a) 613(1) Section 317 (a)(1) 503
(b) 613(2) (a)(2) 504
(b)(2) 703(1)(b), 703(2) (b) 903
Section 312 (a) 701, 702(1) Section 318 (a) 107
(b) 702(2)
(c) 702(3)
Section 313 (a) 703(1)
(b) 703(2)
(c) 703(1), 703(2)
(d) 703(3)
Section 314 (a)(1) 704
(a)(2) 704
(a)(3) 704
(a)(4) 904
(b) Not Applicable
(c)(1) 102
(c)(2) 102
(c)(3) Not Applicable
(d) Not Applicable
(e) 102
Section 315 (a) 601(1)
(b) 602, 703(1)(f)
(c) 601(2)
(d) 601(3)
(d)(1) 601(1)(a)
(d)(2) 601(3)(b)
(d)(3) 601(3)(c)
(e) 514
</TABLE>
Securities: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Indenture.
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
RECITALS OF THE COMPANY.................................................................................1
ARTICLE ONE.............................................................................................1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION............................................1
SECTION 101. Definitions..................................................................1
SECTION 102. Compliance Certificates and Opinions.........................................5
SECTION 103. Form of Documents Delivered to Trustee.......................................5
SECTION 104. Acts of Holders..............................................................6
SECTION 105. Notices, Etc., to Trustee and Company........................................6
SECTION 106. Notice to Holders; Waiver....................................................7
SECTION 107. Conflict with Trust Indenture Act............................................7
SECTION 108. Effect of Headings, Table of Contents, and Reconciliation and Tie............7
SECTION 109. Successors and Assigns.......................................................7
SECTION 110. Separability Clause..........................................................7
SECTION 111. Benefits of Indenture........................................................7
SECTION 112. Governing Law................................................................8
SECTION 113. Legal Holidays...............................................................8
SECTION 114. Persons Deemed Owners........................................................8
ARTICLE TWO.............................................................................................8
AMOUNT, PAYMENT AND RESTRICTION OF TRANSFER OF SECURITIES..........................................8
SECTION 201. Amount Limited...............................................................8
ARTICLE THREE...........................................................................................8
REDEMPTION OF SECURITIES...........................................................................8
SECTION 301. Redemption at Option of the Company..........................................8
SECTION 302. Notice of Redemption.........................................................8
SECTION 303. Payment of Redemption Price..................................................9
SECTION 304. Redemption of Notes if Holder is Not Eligible to Participate in the Program..9
ARTICLE FOUR............................................................................................9
SATISFACTION AND DISCHARGE OF INDENTURE............................................................9
SECTION 401. Satisfaction and Discharge of Indenture......................................9
SECTION 402. Application of Trust Money...................................................9
SECTION 403. Repayment by Paying Agents..................................................10
ARTICLE FIVE...........................................................................................10
REMEDIES..........................................................................................10
SECTION 501. Events of Default...........................................................10
SECTION 502. Acceleration of Maturity; Rescission and Annulment..........................12
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee.............12
SECTION 504. Trustee May File Proofs of Claim............................................13
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
SECTION 505. Trustee May Enforce Claim Without Possession of Securities..................13
SECTION 506. Application of Money Collected..............................................13
SECTION 507. Limitation on Suits.........................................................14
SECTION 508. Unconditional Right of Holders to Receive Principal, and Interest...........14
SECTION 509. Restoration of Rights and Remedies..........................................14
SECTION 510. Rights and Remedies Cumulative..............................................14
SECTION 511. Delay or Omission Not Waiver................................................15
SECTION 512. Control by Holders..........................................................15
SECTION 513. Waiver of Past Defaults.....................................................15
SECTION 514. Undertaking for Costs.......................................................15
SECTION 515. Waiver of Stay or Extension Laws............................................16
ARTICLE SIX............................................................................................16
THE TRUSTEE.......................................................................................16
SECTION 601. Certain Duties and Responsibilities.........................................16
SECTION 602. Notice of Defaults..........................................................17
SECTION 603. Certain Rights of Trustee...................................................17
SECTION 604. Not responsible for Recitals or Issuance of Securities......................18
SECTION 605. May Hold Securities.........................................................18
SECTION 606. Money Held in Trust.........................................................18
SECTION 607. Compensation and Reimbursement..............................................18
SECTION 608. Disqualification; Conflicting Interests.....................................19
SECTION 609. Corporate Trustee Required; Eligibility.....................................19
SECTION 610. Resignation and Removal; Appointment of Successor...........................19
SECTION 611. Acceptance of Appointment by Successor......................................20
SECTION 612. Merger, Conversion, Consolidation or Succession to Business.................21
SECTION 613. Preferential Collection of Claim Against Company............................21
ARTICLE SEVEN..........................................................................................21
HOLDERS' LISTS, PROGRAM INFORMATION AND REPORTS BY TRUSTEE AND COMPANY............................21
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders...................21
SECTION 702. Preservation of Information; Communications to Holders......................21
SECTION 703. Reports by Trustee..........................................................23
SECTION 704. Reports by Company..........................................................23
</TABLE>
<PAGE> 4
<TABLE>
<S> <C>
ARTICLE EIGHT..........................................................................................23
SUPPLEMENTAL INDENTURES...........................................................................23
SECTION 801. Supplemental Indentures without Consent of Holders..........................23
SECTION 802. Supplemental Indentures with Consent of Holders.............................24
SECTION 803. Execution of Supplemental Indentures........................................24
SECTION 804. Effect of Supplemental Indentures...........................................25
SECTION 805. Conformity with Trust Indenture Act.........................................25
ARTICLE NINE...........................................................................................25
COVENANTS.........................................................................................25
SECTION 901. Administration of Program; Payment of Principal and Interest................25
SECTION 902. Maintenance of Security Register, Maintenance of Office or Agency...........25
SECTION 903. Money for Securities Payments to Be Held in Trust...........................26
SECTION 904. Certificate of Officers of the Company......................................26
SECTION 905. Waiver of Certain Covenants.................................................27
ARTICLE 10.............................................................................................27
SUBORDINATION.....................................................................................27
SECTION 1001. Agreement to Subordinate....................................................27
SECTION 1002. Subordination...............................................................27
SECTION 1003. Payments by Trustee or Securities Holders to Holders of Senior Indebtedness.28
SECTION 1004. Subrogation.................................................................28
SECTION 1005. Obligation of Company Unconditional.........................................28
SECTION 1006. Payments on Securities Permitted............................................29
SECTION 1007. Effectuation of Subordination by Trustee....................................29
SECTION 1008. Trustee Not Charged with Knowledge of Prohibition...........................29
SECTION 1009. Trustee May Hold Senior Indebtedness........................................29
SECTION 1010. Rights of Holders of Senior Indebtedness Not Impaired.......................29
SECTION 1011. Rights and Obligations Subject to Power of Court............................30
</TABLE>
<PAGE> 5
INDENTURE, dated as of __________, 2000 between TruServ Corporation, a
corporation duly organized and existing under the laws of the State of Delaware,
(herein called the "Company"), having its principal office at 8600 W. Bryn Mawr
Avenue, Chicago, Illinois 60631 and U.S. Bank Trust National Association, having
its principal offices at 111 E. Wacker Drive, Chicago, Illinois 60601, a
national banking organization organized under the laws of the United States, as
Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
subordinated variable denomination fixed rate term Securities (herein called the
"Securities") pursuant subordinated to the Program (as defined below).
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Securities, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act or by Commission rule under the Trust Indenture Act,
either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with
respect to any computation required or permitted hereunder shall
mean such accounting principles as are generally accepted in the
United States of America at the date of such computation; and
(4) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
Certain terms, used principally in Article Six, are defined in that
Article.
"Act", when used with respect to any Holder, has the meaning specified
in Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
<PAGE> 6
"Agent Bank" means a bank or corporation, and its successors and
assigns, appointed by the Company to act as agent under the Program and to
perform all functions required of such agent pursuant to the provisions of the
Program and to serve as Paying Agent pursuant to the provisions of this
Indenture.
"Board of Directors" means either the board of directors of the Company
or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which the Agent Bank or Trustee is authorized or
obligated by law to close.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Securities Exchange Act of 1934, or, if
at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor corporation.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its President or
a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or
an Assistant Secretary, and delivered to the Trustee.
"Consolidated Net Tangible Assets" means as of any particular time the
aggregate amount of assets after deducting therefrom (a) all current liabilities
(excluding any such liability that by its terms is extendable or renewable at
the option of the obligor thereon to a time more than 12 months after the time
as of which the amount thereof is being computed) and (b) all goodwill, excess
of cost over assets acquired, patents, copyrights, trademarks, trade names,
unauthorized debt discount and expense and other like intangibles, all as shown
in the most recent consolidated financial statements of the Company and its
Subsidiaries prepared in accordance with generally accepted accounting
principles.
"Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which at the date hereof is located at 111 E. Wacker Drive, Chicago, Illinois
60601. With respect to the Paying Agent, the Corporate Trust Office means the
principal office of the Paying Agent at which any particular time its
____________ shall be administered, which at the date hereof is located
at__________________________.
"Corporation" includes corporations, associations, companies and
business trusts.
"Event of Default" has the meaning specified in Section 501.
"Holder" means, with respect to a Security, a Person in whose name at
the time a particular Security is registered in the Security Register.
"Indebtedness" with respect to any Person at any date means and
includes all items of indebtedness or liability which, in accordance with
generally accepted accounting principles, would be included in determining total
liabilities as shown on the liabilities side of a balance sheet of such Person
at such date, and shall include (a) amounts due trade creditors, (b) all
indebtedness guaranteed or endorsed (other than for purposes of collection in
the ordinary course of business), directly or indirectly, in any manner, by such
Person, and contingent obligations of such Person in respect of, or to purchase
or otherwise acquire, indebtedness of others
2
<PAGE> 7
(regardless of whether such indebtedness would appear on a balance sheet), and
(c) all indebtedness secured by any mortgage, lien, pledge, charge or
encumbrance upon property owned by such Person, whether or not the indebtedness
so secured has been assumed by such Person (but if such Person has not assumed
such indebtedness, the amount thereof shall be deemed the lesser of the amount
of such indebtedness or the fair market value of the property that is subject to
such lien, based on the appraisal of a reputable appraiser that is independent
of the Company, which appraisal is as of a date not more than twelve months
prior to the date of determination).
"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.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Company, and
delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for or an employee of the Company or other counsel satisfactory to the
Trustee, which is delivered to the Trustee.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities in which Holders have made investments as
shown on the Securities Register, except:
(1) Securities or portions thereof theretofore redeemed by the Holders
pursuant to the provisions of the Program and this Indenture;
(2) Securities or portions thereof theretofore redeemed by the Company
pursuant to the provisions of this Indenture;
(3) Securities or portions thereof for whose payment or redemption
money in the necessary amount has been theretofore deposited with
the trustee or any Paying Agent (other than the Company) in trust
or set aside and segregated in trust by the Company (if the
Company shall act as its own Paying Agent), for the Holders of
such Securities; provided that, if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant
to this Indenture or provision therefor satisfactory to the
Trustee has been made; provided, however, that in determining
whether the Holders of the requisite principal amount of the
Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder,
Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other
obligor shall be disregarded and deemed not to be Outstanding,
except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Securities which the
Trustee knows to be so owned shall be so disregarded.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Securities on behalf of
the Company. The Agent Bank shall serve as Paying Agent pursuant to the terms of
this Indenture.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Program" means the TruServ Corporation Variable Denomination
Subordinated Fixed Rate Term Note Program established by the Company and in
effect on the date hereof, as the same may be amended or supplemented by the
Company from time to time.
"Principal Amount", when used with reference to a Security, means, as
of a particular time, the sum of the funds invested in a Security, plus the sum
of interest accrued, paid and reinvested in a Security, less the sum of
redemptions from time to time.
3
<PAGE> 8
"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.
"Responsible Officer", when used with respect to the Trustee, means the
chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
or any assistant controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Secured Debt" means indebtedness for money borrowed which is secured
by a mortgage, pledgee, lien, security interest or encumbrance on any property
of any character of the Company.
"Security" or "Securities" means any Variable Denomination Subordinated
Fixed Rate Term Note or Notes, as the case may be, issued pursuant to the
Program and under this Indenture, which are evidenced by an individual record or
entries in the name of the Particular Holder established on the Security
Register.
"Security Register" has the meaning specified in Section 902.
"Senior Indebtedness" means the principal amount of, and the interest
on, fees, expenses, indemnities, reimbursement obligations and all other
obligations with respect to any Indebtedness of the Company for money borrowed,
whether presently outstanding or hereafter incurred, unless it is provided in
the appropriate instruments that such Indebtedness for money borrowed is not
senior to the Securities.
"Subsidiary" means, with respect to the Company, a corporation more
than fifty percent (50%) of the outstanding voting stock of which is owned,
directly or indirectly, by the Company or by one or more other Subsidiaries, or
by the Company and one or more other Subsidiaries. For the purposes of this
definition, "voting stock" means stock which ordinarily has voting power for the
election of directors, whether at all times or only so long as no senior class
of stock has such voting power by reason of any contingency.
"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 or include each Person who is then a Trustee
hereunder.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed, except as
provided in Section 805.
"United States" means the United States of America (including the
States and the District of Columbia), its territories, its possessions and other
areas subject to its jurisdiction.
"Vice President", when used with respect to the Company, means any vice
president, whether or not designated by a number or a word or words added before
or after the title "vice president".
"Wholly-owned Subsidiary" means any Subsidiary of which, at the time of
determination, all of the outstanding voting stock (other than directors'
qualifying shares) is owned by the Company, directly or indirectly. For purposes
of this definition, "voting stock" has the same meaning as under the definition
of "Subsidiary".
4
<PAGE> 9
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than annual
certificates provided pursuant to Section 905) shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein relating
thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he/she
has made such examination or investigation as is necessary to enable him/her to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his/her certificate or opinion is based
are erroneous. Any such certificate or Opinion of Counsel may be based, insofar
as it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
5
<PAGE> 10
SECTION 104. Acts of Holders.
(1) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or
taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders
in person or by agent duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the
Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as
the "Act" of the Holders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of
this Indenture and (subject to Section 601) conclusive in favor of
the Trustee and the Company, if made in the manner provided in
this Section.
(2) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness
of such execution or by a certificate of a notary public or other
officer authorized by law to take acknowledgments of deeds,
certifying that the individual signing such instrument or writing
acknowledged to him the execution thereof. Where such execution is
by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of
the Person executing the same, may also be proved in any other
manner which the Trustee deems sufficient.
(3) The ownership of Securities shall be proved by reference to the
Security Register.
(4) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made upon
such Security.
(5) The Company may set a record date for purposes of determining the
identity of Holders entitled to give any request, demand,
authorization, direction, notice, consent, waiver or other Act
which record date shall be the later of ten (10) days prior to the
first solicitation of such action or the date of the most recent
list of Holders furnished to the Trustee pursuant to Section 701
of this Indenture 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 or to revoke any such
previous action, whether or not such persons continue to be
Holders after such record date. No such request, demand,
authorization, direction, notice, consent, waiver or other Act
shall be valid or effective for more than one hundred and twenty
(120) days after such record date.
SECTION 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in
writing to or with the Trustee and received at its Corporate Trust
Office, Attention: Corporate Trust Department, or
6
<PAGE> 11
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid,
to the Company addressed to it at the address of its principal
office specified in the first paragraph of this instrument or at
any other address previously furnished in writing, to the Trustee
or Holders by the Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address, as it appears in the Security Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Indenture provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
SECTION 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with the duties
imposed by any of Sections 310 to 317, inclusive, of the Trust Indenture Act
through operation of Section 318(c) thereof, such imposed duties shall control.
SECTION 108. Effect of Headings, Table of Contents, and Reconciliation and Tie.
The Article and Section headings herein and the Table of Contents and
Reconciliation and Tie are for convenience only and shall not affect the
construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
7
<PAGE> 12
SECTION 112. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with Federal law and with the laws of the State of Illinois.
SECTION 113. Legal Holidays.
In any case where any Redemption Date shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of the redemption price need not be made on such date, but may be made
on the next succeeding Business Day with the same force and effect as if made on
the Redemption Date, provided that no interest shall accrue for the period from
and after such Redemption Date.
SECTION 114. Persons Deemed Owners.
The Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Security is registered as the owner of
such Security for the purpose of receiving payment of principal of or interest
on such Security and for all other purposes whatsoever, whether or not such
Security be overdue, and neither the Company, the Trustee nor any agent of the
Company or the Trustee shall be affected by notice to the contrary.
ARTICLE TWO
AMOUNT, PAYMENT AND
RESTRICTION OF TRANSFER OF SECURITIES
Section 201. Amount Limited.
The Securities shall be issued pursuant to the Program and under this
Indenture in a principal amount not to exceed the amount of Securities as stated
in the Program's prospectus dated ____________, 2000.
SECTION 202. Payment.
The Securities shall be payable at the office or agency of the Agent
Bank as may from time to time be designated in writing, maintained for such
purpose in such coin or currency of the United States of America as at the time
of payment is legal tender for the payment of public and private debts.
SECTION 203. Restriction on Transfer and Pledge of Securities.
The Securities may not be transferred or pledged, in whole or in part,
either directly or by operation of law or otherwise.
ARTICLE THREE
REDEMPTION OF SECURITIES
SECTION 301. Redemption at Option of the Company.
The Company may redeem, at any time in its discretion, all or any
portion of the Securities issued pursuant to the Program and under this
Indenture. Any partial redemption of the entirety of the Notes will be effected
by lot or pro rata or by any other method that is deemed fair and appropriate by
the Trustee.
SECTION 302. Notice of Redemption.
The Company may give prior written notice of at least thirty (30) days
but not more than ninety (90) days to Holders whose Notes are subject to full or
partial redemption. A copy of any notices shall be given to the Trustee. Such
notice from the Company will specify the effective date of redemption, the
amount being redeemed and the effective date the redeemed amount shall become
due and payable and that interest shall cease to accrue as of that date. All
partial redemption notices will list the remaining, principal amount of the
Security.
8
<PAGE> 13
SECTION 303. Payment of Redemption Price.
Upon redemption the full or partial Security being redeemed, plus
accrued and unpaid interest therein to the date of redemption, shall be paid by
check to the Holder. The Company covenants that it will pay or cause to be paid
to the Trustee or to the Agent Bank or to another Paying Agent cash in an amount
sufficient to pay the principal amount of the Security or portion thereof to be
redeemed on such date. Interest on the redeemed amount shall cease to accrue on
and after the effective date the redeemed amount shall have become due and
payable.
SECTION 304. Redemption of Notes if Holder is Not Eligible to Participate in
the Program.
The Company also may redeem, at any time in its sole and absolute
discretion, any Security issued pursuant to the Program and under this Indenture
if the Holder of such Security is not eligible to participate in the Program as
defined in the annual Program Description. Notice of such redemption will be
given in the manner provided in Section 302, and payment of the redemption price
shall be made as provided in Section 303.
ARTICLE FOUR
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 401. Satisfaction and Discharge of Indenture.
If at any time:
(1) the Company shall have terminated the Program pursuant to its
provisions,
(2) all the Notes shall have become due and payable,
(3) the Company shall have deposited or caused to be deposited with
the Trustee as trust funds the entire amount (other than moneys
repaid by any Paying Agent to the Trustee in accordance with
Section 403) sufficient to pay all the Notes, including principal
and interest due or to become due to such date of maturity, and
(4) the Company shall have paid or caused to be paid all other sums
payable hereunder by the Company, then this Indenture shall cease
to be of further effect, and the Trustee, on demand of and at the
cost and expense of the Company shall execute proper instruments
acknowledging satisfaction of and discharge of this Indenture,
which instruments shall be prepared by the Company. The Company
agrees to reimburse the Trustee for any costs or expenses
thereafter reasonably and properly incurred by the Trustee in
connection with this Indenture, the Program or the Notes.
SECTION 402. Application of Trust Money.
All moneys deposited with the Trustee pursuant to Section 401 shall be
held in trust and applied by it to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent), to the
Holders of the Notes for the payment of which such moneys have been deposited
with the Trustee of all sums due and to become due thereon for principal and
interest. The Trustee shall be under no obligation to invest or pay interest on
any moneys so held in trust.
SECTION 403. Repayment by Paying Agents.
In connection with the satisfaction and discharge of this Indenture all
moneys then held by any Paying Agent under the provisions of this Indenture
shall, upon demand of the Company, be repaid to it or paid to the Trustee and
thereupon such Paying Agent shall be released from all further liability with
respect to such moneys.
9
<PAGE> 14
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Events of Default", means any one of the following events (whatever
the reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) default in the payment of any part of or all the principal of or
interest on any Security as and when the same shall be due and
payable, in accordance with the then current provisions and rules
and regulations of the Program and this Indenture; provided,
however, that:
(a) the failure of the Company to make any payment of the
principal of or interest on any Security, or any delay in
making such payment shall not be considered in determining
whether an "Event of Default" shall have occurred if:
(i) the Trustee believes in good faith that the Security
is subject to a conflicting claim, attachment, lien or
proceeding, or any person demanding such payment is
not, or may not be, legally entitled thereto, or the
amount of the payment demanded exceeds the principal
amount of the Security according to the Security
Register, or the demand for payment has not been made
in accordance with the then current provisions and
rules and regulations of the Program, or the payment
cannot be made in accordance with the then current
provisions and rules and regulations of the Program,
or
(ii) the Company shall have paid over to the Trustee for
deposit to an account not subject to offset, charge or
encumbrance by the Trustee the amount of the principal
of or interest on any Security which has become due
and payable, and if requested by the Trustee the
Company shall have furnished the Trustee with an
Officers' Certificates as to the matters described in
the foregoing clauses (i) and (ii); or
(b) an administrative error relating to a Security or improperly
identifying the Security of a Holder shall not be considered
in determining whether an "Event of Default" shall have
occurred unless such error shall have continued uncorrected
for a period of sixty (60) days after written notification
thereof to the Agent Bank or the Trustee by a Holder, the
Trustee to be the sole judge of whether the error has been
corrected (the above enumeration of specific examples of
situations which shall not be considered in determining
whether an "Event of Default" shall have occurred shall not
be exclusive, and the Trustee may determine in any particular
instance and, absence bad faith, shall incur no liability to
any person in so determining whether the circumstances
concerning a particular Security should be considered in
determining whether an "Event of Default" shall have
occurred); or
(2) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is
elsewhere in this Section specifically dealt with), and
continuance of such default or breach for a period of sixty (60)
days after there has been given, by
10
<PAGE> 15
registered or certified mail, to the Company by the Trustee or to
the Company and the Trustee by the Holders of at least twenty-five
per cent (25%) in principal amount of the Outstanding Securities 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
(3) the entry by a court having jurisdiction in the premises of:
(a) a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable Federal
or State bankruptcy, insolvency, reorganization or other
similar law or
(b) a decree or order adjudging the Company a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or
in respect of the Company under any applicable Federal or
State law, or appointing a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of
the Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and
the continuance of any such decree or order for relief or any
such decree or order remains unstayed and in effect for a
period of sixty (60) consecutive days; or
(4) the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or of any other case or
proceeding to be adjudicated a bankrupt or insolvent, or the
consent by it to the entry of a decree or order for relief in
respect of the Company in an involuntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any
bankruptcy or insolvency case or proceeding against it, or the
filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable Federal or State
law, or the consent by it to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or similar official of
the Company or of any substantial part of its property, or the
making by it of an assignment for the benefit of creditors, or the
admission by it in writing of its inability to pay its debts
generally as they become due, or the taking of corporate action by
the Company in furtherance of any such action; or
(5) in connection with any proceeding under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors,
involving the Company or one of its Subsidiaries an order for
relief shall be entered by a court of competent jurisdiction which
affects any significant part of the assets of the Company or any
of its Subsidiaries.
11
<PAGE> 16
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to the Notes occurs and is
continuing, then in every such case the Trustee or the Holders of not less than
fifty percent (50%) in the principal amount of the Outstanding Securities may
declare all of the Securities to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), and upon any
such declaration such principal amount shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
the Securities 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, by written notice to the Company and the Trustee, shall rescind and
annul such declaration and its consequences if:
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(a) the principal of any Securities which have become due
otherwise than by such declaration of acceleration and
interest thereon at the rate or rates prescribed therefor in
such Securities;
(b) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates
prescribed therefor in such Securities, and
(c) 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 the Securities, other than
the non-payment of the principal of Securities which have become due solely by
such declaration of acceleration, have been cured or waived as provided in
Section 513.
No such rescission shall affect any subsequent default or impair any
right consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if default is made in the payment of the
principal of or interest on any Security when the same shall have become due and
payable the Company will, upon demand of the Trustee, pay to it, for the benefit
of the Holders of such Securities, the whole amount then due and payable on such
Securities for principal and interest and, to the extent that payment of such
interest shall be legally enforceable, interest on any overdue principal and on
any overdue interest, at the rate or rates prescribed therefor in such
Securities, and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
If the Company 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, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company 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 the Company or any other obligor upon such Securities, wherever
situated.
If an Event of Default with respect to the 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 the Securities 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.
12
<PAGE> 17
SECTION 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise:
(1) to file and prove a claim for the whole amount of principal and
interest owing and unpaid in respect of the Securities, to
participate as a member, voting or otherwise, of any official
committee appointed in such matter, and to file such other papers
or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee
and any predecessor Trustee, their agents and counsel) and of the
Holders allowed in such judicial proceeding, and
(2) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator
or other similar official in any such judicial proceeding is
hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the
Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee and any
predecessor Trustee, their agents and counsel, and any other
amounts due the Trustee and any predecessor Trustee under Section
607.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claim Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the 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.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee:
FIRST: To the payment of all amounts due the Trustee and any predecessor Trustee
under Section 607; and SECOND: To the payment of the amounts then due and unpaid
for principal of and interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal and interest, respectively.
13
<PAGE> 18
SECTION 507. Limitation on Suits.
No Holder of any Security shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless:
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities;
(2) the Holders of not less than fifty percent (50%) in principal
amount of the Outstanding Securities 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 sixty (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 sixty (60) day period by the Holders of
a majority in principal amount of the Outstanding Securities; it
being understood and intended that no one or more of such Holders
shall have any right in any manner whatever by virtue of, or by
availing of, any provision of this Indenture to affect, disturb or
prejudice the rights of any other of such Holders, or to obtain or
to seek to obtain priority or preference over any other of such
Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit
of all such Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal, and Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest on such Security on the
applicable due date provided therefor pursuant to the Program (or, in the case
of redemption, on the redemption date) and to institute suit for the enforcement
of any such payment, and such rights shall not be impaired without the consent
of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the 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, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
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.
14
<PAGE> 19
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities
to exercise any right or remedy acting 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.
SECTION 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding
Securities 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,
provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture,
(2) subject to Section 601, the Trustee shall have the right to
decline to follow any such direction if the Trustee shall
reasonably determine, in good faith, that the action or proceeding
so directed would be unjustly prejudicial to any Holders not
joining in such direction or would involve the Trustee in any
personal liability unless indemnified to its reasonable
satisfaction, and
(3) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities may on behalf of the Holders of all the Securities waive
any past default hereunder and its consequences, except a default:
(1) in the payment of the principal of or interest on any Security, or
(2) in respect of a covenant or provision hereof which under Article
Eight cannot be modified or amended without the consent of the
Holders of each Outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
SECTION 514. Undertaking for Costs.
All Parties to this Indenture agree, and each Holder of any Security by
his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than ten percent
(10%) in principal amount of the Outstanding Securities, or to any suit
instituted by any Holder for the enforcement of the payment of the principal of
or interest on the Security on or after the applicable due date therefor
provided pursuant to the Program (or, in the case of redemption, on or after,
the Redemption Date).
SECTION 515. Waiver of Stay or Extension Laws.
15
<PAGE> 20
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
(1) Except during the continuance of an Event of Default,
(a) the Trustee undertakes to perform such duties and
only such duties as are specifically set forth in
this Indenture, and no implied covenants or
obligations shall be read into this Indenture against
the Trustee; and
(b) in the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the
requirements of the Indenture; but in the case of any
such certificates or opinions which by any provision
hereof are specifically required to be furnished to
the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they
conform to the requirements of this Indenture.
(2) In case an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers
vested in it by this Indenture, and use the same degree of
care and would in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of
his/her own affairs.
(3) No provision of this Indenture shall be construed to relieve
the Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct,
except that
(a) this Subsection shall not be construed to limit the
effect of Subsection (1) of this Section;
(b) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer,
unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts;
(c) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders
of a majority in principal amount of the Outstanding
Securities, determined as provided in Section 512,
relating to the time, method and place of conducting
any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred
upon the Trustee, under this Indenture with respect
to the Securities; and
(d) 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 it shall
16
<PAGE> 21
have reasonable grounds for believing that repayment
of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it.
(4) Whether or not therein expressly so provided, every provision
of this Indenture relating to the conduct or affecting the
liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
SECTION 602. Notice of Defaults.
Within ninety (90) days after the occurrence of any default hereunder
with respect to the Securities, the Trustee shall transmit by mail to all
Holders of Securities, as their names and addresses appear in the Security
Register, notice of such default hereunder known to the Trustee, unless such
default shall have been cured or waived; provided, however, that, except in the
case of a default in the payment of the principal of or interest on any
Security, the Trustee shall be protected in withholding such notice if and so
long as the board of directors, the executive committee or a trust committee of
directors or Responsible Officers of the Trustee in good faith determine that
the withholding of such notice is in the interest of the Holders of Securities;
and provided, further, that in the case of any default of the character
specified in Section 501(3) with respect to the Securities, no such notice to
Holders shall be given until at least thirty (30) days after the occurrence
thereof. For the purpose of this Section, the term "default" means any event
which is, or after notice or lapse of time or both would become, an Event of
Default.
SECTION 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, Securities, other
evidence of indebtedness or other paper or document believed
to be genuine and to have been signed or presented by the
proper party or parties;
(2) any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company
Order and any resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder,
the Trustee (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith on its part, rely
upon an Officers' Certificate;
(4) the Trustee may consult with counsel and the written advice,
or oral advice subsequently confirmed in writing, of such
counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in
reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by 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;
(6) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, Note, other
evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such
17
<PAGE> 22
further inquiry or investigation into such facts or matters as
it may see fit, and, if the Trustee shall determine to make
such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company,
personally or by agent or attorney;
(7) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be
responsible for any misconduct or negligence on the part of
any agent or attorney appointed with due care by it hereunder;
and
(8) 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 the Indenture.
SECTION 604. Not responsible for Recitals or Issuance of Securities.
The recitals contained herein and the statements in the Program
prospectus shall be taken as the statements of the Company, 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 Company of securities or the proceeds thereof.
SECTION 605. May Hold Securities.
Subject to the provisions of the Program with respect to Persons who
may hold Securities, the Trustee, the Agent Bank, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner of Securities and, subject to Sections 608 and
613, may otherwise deal with the Company with the same rights it would have if
it were not Trustee, Agent Bank, Paying Agent, Security Registrar or such other
agent.
SECTION 606. 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 in writing with the Company
SECTION 607. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse
the 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 or willful misconduct; and
(3) to indemnify each of the Trustee and any predecessor Trustee
for, and to hold it harmless against, any loss, liability or
expense incurred without negligence, bad faith or willful
misconduct, on Trustee's or any predecessor Trustee's part,
arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder or the
performance of their duties hereunder, including the costs and
expenses of enforcing this Indenture against the Company
(including this Section 607), defending itself against any
claim (whether
18
<PAGE> 23
asserted by any Holder or the Company) or liability in
connection with the exercise or performance of any of its
powers or duties hereunder.
To secure the Company's payment obligations in this Section 607, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee, except that held in trust to pay particular
Securities.
The Company's payment obligations pursuant to this Section 607 shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a default specified in Sections 501(3), (4) or (5), the
expenses are intended to constitute expenses of administration, under federal or
state bankruptcy laws.
SECTION 608. Disqualification; Conflicting Interests.
The Trustee shall be subject to the provisions of Section 310(b) of the
Trustee Indenture Act during the period of time provided for therein. Nothing
herein shall prevent the Trustee from filing with the Commission the application
referred to in the second-to-last paragraph of Section 310(b) of the Trust
Indenture Act.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least $50,000,000, subject to supervision or examination by Federal or
State authority; provided, however, that if Section 310(a) of the Trust
Indenture Act or the rules and regulations of the Commission under the Trust
Indenture Act at any time permit a corporation organized and doing business
under the laws of any other jurisdiction to serve as trustee of an indenture
qualified under the Trust Indenture Act, this Section 609 shall be automatically
amended to permit a corporation organized and doing business under the laws of
any such other jurisdiction to serve as Trustee hereunder. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for the purposes
of this Section, the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. Neither the Company nor any person directly or
indirectly controlling, controlled by or under common control with the Company
may serve as Trustee. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
SECTION 610. Resignation and Removal; Appointment of Successor.
(1) No resignation or removal of the Trustee and no appointment of
a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor
Trustee in accordance with the applicable requirements of
Section 611.
(2) The Trustee may resign at any time with respect to the
Securities by giving written notice thereof to the Company. If
the instrument of acceptance by a successor Trustee required
by Section 611 shall not have been delivered to the Trustee
within thirty (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 the Securities of such series.
(3) The Trustee may be removed at any time with respect to the
Securities by Act of the Holders of a majority in principal
amount of the Outstanding Securities, delivered to the Trustee
and to the Company.
(4) If at any time:
(a) the Trustee shall fail to comply with Section 608
after written request therefor by the Company or by
any Holder who has been a bona fide Holder of a
Security for at least six (6) months,
19
<PAGE> 24
unless the Trustee's duty to resign has been stayed
as provided in Section 310(b) of the Trust Indenture
Act, or
(b) the Trustee shall cease to be eligible under Section
609 and shall fail to resign after written request
therefor by the Company or by any such Holder, or
(c) the Trustee shall become incapable of acting or shall
be adjudged a bankrupt or insolvent or a receiver of
the Trustee or of its property shall be appointed or
any public officer shall take charge or control of
the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or
liquidation.
then, in any case, (i) the Company by a Board Resolution may
remove the Trustee with respect to all Securities, or (ii)
subject to Section 514, any Holder who has been a bona fide
Holder of a Security for at least six (6) months may, on
behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the removal of the
Trustee with respect to all Securities and the appointment of
a successor Trustee or Trustees.
(5) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee
for any cause, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee and shall comply with the
applicable requirements of Section 611. If, within one (1)
year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be
appointed by Act of the Holders of a majority in principal
amount of the Outstanding Securities delivered to the Company
and the retiring Trustee, the successor Trustee so appointed
shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 611,
become the successor Trustee and to that extent supersede the
successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the
Holders and accepted appointment in the manner required by
Section 611, any Holder who has been a bona fide Holder of a
Security for at least six (6) months may, on behalf of himself
and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor
Trustee.
(6) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor
Trustee by mailing written notice of such event by first-class
mail, postage prepaid, to all Holders of Securities as their
names and addresses appear in the Security Register. Each
notice shall include the name of the successor Trustee and the
address of its Corporate Trust Office.
SECTION 611. Acceptance of Appointment by Successor.
(1) In case of the appointment hereunder of a successor Trustee,
every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring
Trustee an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all
the rights, powers, trusts and duties of the retiring Trustee;
but, on the request of the Company or the successor Trustee,
such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver
to such successor Trustee all property and money held by such
retiring Trustee hereunder.
(2) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly
vesting in and
20
<PAGE> 25
confirming to such successor Trustee all such rights, powers
and trusts referred to in paragraph (1) of this Section.
(3) No successor Trustee shall accept its appointment unless at
the time of such acceptance such successor Trustee shall be
qualified and eligible under this Article.
SECTION 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.
SECTION 613. Preferential Collection of Claim Against Company.
Upon and so long as the Indenture is qualified under the TIA, the
Trustee is subject to TIA Section 311(a), excluding any creditor relationship
listed in TIA Section 311(b). A Trustee who has resigned or been removed is
subject to TIA Section 311(a) to the extent indicated.
ARTICLE SEVEN
HOLDERS' LISTS, PROGRAM INFORMATION AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee:
(1) semi-annually, not later than March 1 and September 1 in each
year, a list in such form as the Trustee may reasonably
require, of the names and addresses of the Holders as of the
preceding February 15 or August 15, as the case may be;
(2) at such other times as the Trustee may request in writing,
within thirty (30) days after the receipt by the Company of
any such request, a list of similar form and content as of a
date not more than fifteen (15) days prior to the time such
list is furnished; and
(3) from time to time, all current information and rules and
regulations regarding the Program, including all amendments
thereto.
excluding from any such list names and addresses received by the Trustee in the
event that it is the Security Registrar.
SECTION 702. Preservation of Information; Communications to Holders.
(1) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders
contained in the most recent list furnished to the Trustee as
provided in Section 701 and the names and addresses of Holders
received by the Trustee in its capacity as Security Registrar.
The Trustee may destroy any list furnished to it as provided
in Section 701 upon receipt of a new list so furnished.
(2) If three (3) or more Holders (herein referred to as
"applicants") apply in writing to the Trustee, and furnish to
the Trustee reasonable proof that each such applicant has
owned a Security for a period of at least six (6) months
preceding the date of such application, and such application
states that the applicants desire to communicate with other
Holders with respect to their rights under this Indenture or
under the Securities and is accompanied by a copy of the form
of proxy or other communication which such applicants propose
to transmit, then
21
<PAGE> 26
the Trustee shall, within five (5) business days after
the receipt of such application, at its election, either
(a) afford such applicants access to the information
preserved at the time by the Trustee in accordance
with Section 702(1), or
(b) inform such applicants as to the approximate number
of Holders whose names and addresses appear in the
information preserved at the time by the Trustee in
accordance with Section 702(1), 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 written request of such applicants, mail
to each Holder whose name and address appear in the
information preserved at the time by the Trustee in
accordance with Section 702(1) 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
(5) 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 interest of the Holders 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
such Holders 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 respecting
their application.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company
nor the Trustee nor any agent of either of them shall be held
accountable by reason of the disclosure of any such information as to
the names and addresses of the Holders in accordance with Section
702(2), regardless of the source from which such information was
derived, and that the Trustee shall not be hold accountable by reason
of mailing any material pursuant to a request made under Section 702.
22
<PAGE> 27
SECTION 703. Reports by Trustee.
(1) Within sixty (60) days after May 15 of each year beginning
with the year 2001, the Trustee shall transmit by mail to all
Holders, as their names and addresses appear in the Security
Register, a brief report dated as of such May 15 that complies
with TIA Section 313(a), if required by such Section 313(a).
The Trustee also shall comply with TIA Section 313(b).
(2) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each
stock exchange upon which any Securities are listed, with the
Commission and with the Company. The Company will notify the
Trustee when any Securities are listed on any stock exchange.
SECTION 704. Reports by Company.
The Company shall:
(1) file with the Trustee, within fifteen (15) days after the
Company is required to file the same with the Commission,
copies of the annual reports and of the information, documents
and other reports (or copies of such portions of any of the
foregoing as the Commission may from time to time by rules and
regulations prescribe) which the Company may be required to
file with the Commission pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934; or, if the
Company is not required to file information, documents or
reports pursuant to either of said Sections, then it shall
file with the Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time by the
Commission, such of the supplementary and periodic
information, documents and reports which may be required
pursuant to Section 13 of the Securities Exchange Act of 1934
in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in
such rules and regulations;
(2) file with the Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time by the
Commission, such additional information, documents and reports
with respect to compliance by the Company with the conditions
and covenants of this Indenture as may be required from time
to time by such rules and regulations; and
(3) transmit by mail to all Holders, as their names and addresses
appear in the Security Register, within thirty (30) days after
the filing thereof with the Trustee, such summaries of any
information, documents and reports required to be filed by the
Company pursuant to paragraphs (1) and (2) of this Section as
may be required by rules and regulations prescribed from time
to time by the Commission.
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 801. Supplemental Indentures without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into 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 the
Company and the assumption by any such successor of the
covenants of the Company herein and in the Securities; or
23
<PAGE> 28
(2) to add to the covenants of the Company for the benefit of the
Holders of the Securities or to surrender any right or power
herein conferred upon the Company; or
(3) to add any additional Events of Default; or
(4) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee and to add to or change any
of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the
requirements of Section 611(2); or
(5) to cure any ambiguity, or correct or supplement any provision
herein which may be defective or inconsistent with any other
provision herein, or to make any other provisions with respect
to matters or questions arising under this Indenture, provided
that such action shall not adversely affect the interests of
the Holders of Securities in any material respect.
SECTION 802. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than sixty-six and
two-thirds percent (66 2/3%) in principal amount of the Outstanding Securities,
by Act of said Holders delivered to the Company and the Trustee, the Company,
when authorized by a Board Resolution, and the Trustee may enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of modifying in any manner the rights of the Holders of
Securities under this Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Security
affected thereby,
(1) reduce the principal amount of any Security or impair the
right to institute suit for the enforcement of any such
payment on or after the applicable due date thereof (or, in
the case of redemption, on or after the Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding
Securities, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders
is required for any waiver (of compliance with certain
provisions of this Indenture or certain defaults hereunder and
their consequences) provided for in this Indenture, or
(3) Change any obligation of the Company, with respect to
Outstanding Securities, to maintain an office or agency in the
places and for the purposes specified in Section 902, or
(4) modify any of the provisions of this Section, Section 513 or
Section 904, 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; provided, however,
that this clause shall not be deemed to require the consent of
any Holder with respect to changes in the references to "the
Trustee" and concomitant changes in this Section and Section
904, or the deletion of this proviso, in accordance with the
requirements of Sections 611(2) and 801(5).
It shall not be necessary for any Act of Holders under this Section to approve
the particular form of any proposed supplemental indenture, but it shall be
sufficient if such Act shall approve the substance thereof.
SECTION 803. 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 (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating
24
<PAGE> 29
that the execution of such supplemental indenture is authorized or permitted by
this Indenture. The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
SECTION 804. 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 805. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
ARTICLE NINE
COVENANTS
SECTION 901. Administration of Program; Payment of Principal and Interest.
(1) The Company covenants and agrees to maintain and administer
the Program and the Securities issued pursuant thereto in
accordance with the provisions of the Program, as the same may
from time to time be in force and effect, and this Indenture;
provided, however, that nothing herein shall prevent the
Company from exercising any of its rights to amend, modify or
terminate the Program, or to adopt, amend or rescind the rules
established under the Program, as provided therein.
(2) The Company covenants and agrees for the benefit of Holders of
Securities that it will duly and punctually pay the principal
of and interest on the Securities in accordance with the terms
of the Program and this Indenture. Interest will accrue on the
Securities in accordance with the provisions of the Program.
The interest rate on the Securities shall be determined in
accordance with the provisions of the Program. Interest rates
will vary from time to time. There are no minimum or maximum
interest rates.
SECTION 902. Maintenance of Security Register, Maintenance of Office or
Agency.
(1) The Company will keep at an office or agency proper books of
record and account (which books may be in written form or in
any other form capable of being converted into written form)
in which full and correct entries shall be made of all funds
invested in the Securities, together with interest accrued
thereon, and all redemptions thereof, in accordance with sound
accounting practice and which shall contain the names and
addresses of all Holders and the principal amounts of their
respective Securities (collectively, the "Security Register").
(2) The Company will maintain in the City of Chicago or such other
city where the Company maintains its corporate headquarters an
office or agency where notices and demands hereunder may be
given to or made upon the Company in respect of the Securities
and this Indenture may be served. The Company will give prompt
written notice to the Trustee and the Holders of the location,
and any change in the location, of any such office or agency.
If at any time the Company shall fail to maintain any such
required office or agency or shall fail to furnish the Trustee
with the address thereof, such notices and demands may be made
or served at the Corporate Trust Office of the Trustee.
SECTION 903. Money for Securities Payments to Be Held in Trust.
Whenever the Company shall have one or more Paying Agents, it will,
prior to each due date of the principal of, or interest on any Securities,
deposit with a
25
<PAGE> 30
Paying Agent a sum sufficient to pay the principal or interest so becoming due,
such sum to be held in trust for the benefit of the Persons entitled to such
principal or interest. If the Company fails to deposit such sums with the Paying
Agent, unless such Paying Agent is the Trustee, the Company will promptly notify
the Trustee of its failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject, to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of
or interest on Securities in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities) in the making of any
payment of principal or interest on the Securities; and
(3) at any time during the continuance of any such default, upon
the written request of the Trustee, forthwith pay to the
Trustee all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paving Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of or interest on any
Security and remaining unclaimed for three years after such principal or
interest has become due and payable shall be paid to the Company upon the
Company's request; and the Holder of such Security shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the City of
Chicago, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than thirty (30) days from the date
of such publication, any unclaimed balance of such money then remaining will be
repaid to the Company.
SECTION 904. Certificate of Officers of the Company.
On or before the last day of March of each year beginning with the year
2001, the Company will file with the Trustee a certificate of the principal
executive officer, principal financial officer or principal accounting officer
stating whether or not the signer has obtained knowledge of any action or
failure to act on the part of the Company during the preceding calendar year in
violation of any covenant, agreement, provision or condition contained in this
Indenture and, if so, specifying, each such default of which the signers may
have knowledge and the nature thereof. For purposes of this Section 904,
compliance shall be determined without regard to any period of grace or
requirement of notice provided pursuant to the terms of this Indenture.
SECTION 905. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 902 to 904, inclusive, if
before the time for such compliance the Holders of at least sixty-six and
two-thirds percent (66 2/3%) in principal amount of the Outstanding Securities
shall, by Act of such
26
<PAGE> 31
Holders, either waive such compliance in such instance or general waive
compliance with such term, provision or condition, but no such waiver shall
extend to or affect such term, provision or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such term,
provision or condition shall remain in full force and effect.
ARTICLE 10
SUBORDINATION
SECTION 1001. Agreement to Subordinate
The Company covenants and agrees, and each Holder of Securities by his
or her acceptance thereof, likewise covenants and agrees, that the Indebtedness
represented by the Securities and the payment of the principal of and interest
on each and all of the Securities and all claims arising in connection with the
Securities, including without limitation, the payment of all fees, other costs,
rescission claims and indemnities, is hereby expressly subordinated, to the
extent and in the manner hereinafter set forth, in right of payment to the prior
payment in full of all Senior Indebtedness and all liabilities of the Company
and its Subsidiaries incurred in the ordinary course of business as provided in
this Article 10.
SECTION 1002. Subordination
Upon any distribution of assets of the Company upon any dissolution,
winding up, liquidation or reorganization of the Company (whether in bankruptcy,
insolvency, reorganization or receivership proceedings) or upon an assignment
for the benefit of creditors or any other marshalling of the assets and
liabilities of the Company or if an event of default shall have occurred and be
continuing with respect to any Senior Indebtedness or if the principal of the
Securities shall have been declared due and payable pursuant to Section 5.02
hereof and such declaration shall not have been rescinded and annulled as
provided in such Section 5.02, then:
(a) the holders of all Senior Indebtedness shall first be entitled
to receive payment in full of the principal thereof and
interest due thereon, or adequate provision shall be made for
such payment, before the Holders are entitled to receive any
further payment on account of the principal of or interest on
indebtedness evidenced by the Securities; and
(b) any further payment by, or distribution of assets of, the
Company of any kind or character, whether in cash, property or
securities (other than securities of the Company as
reorganized or readjusted or securities of the Company or any
Person provided for by a plan of reorganization or
readjustment the payment of which is subordinate, at least to
the extent provided in this Article 10 with respect to the
Securities, to the payment of all Senior Indebtedness,
provided that the rights of the holders of Senior Indebtedness
are not altered by such reorganization or readjustment), to
which the Holders or the Trustee would be entitled except for
the provisions of this Article 10 shall be paid or delivered
by the person making such payment or distribution, whether a
trustee in bankruptcy, a receiver or liquidating trustee or
otherwise directly to the holders of Senior Indebtedness or
their representative or representatives or to the trustee or
trustees under any indenture under which any instruments
evidencing any of such Senior Indebtedness may have been
issued, ratably according to the aggregate amounts remaining
unpaid on account of the Senior Indebtedness and held or
represented by each, to the extent necessary to make payment
in full of all Senior Indebtedness remaining unpaid after
giving effect to any concurrent payment or distribution to the
holders of such Senior Indebtedness or provision therefor.
SECTION 1003. Payments by Trustee or Securities Holders to Holders of Senior
Indebtedness
27
<PAGE> 32
In the event that any payment by, or distribution of assets of, the
Company of any kind or character, whether in cash, property or securities (other
than securities of the Company as reorganized or readjusted or securities of the
Company or any Person provided for by a plan of reorganization or readjustment
the payment of which is subordinate, at least to the extent provided in this
Article 10 with respect to the Securities, to the payment of all Senior
Indebtedness, provided that the rights of the holders of Senior Indebtedness are
not altered by such reorganization or readjustment), shall be received by the
Trustee or the Holders before all Senior Indebtedness is paid in full, contrary
to the provisions of this Article 10, such payment or distribution shall be paid
over to the holders of such Senior Indebtedness (which shall have been
identified in writing to the Trustee) or their representative or representatives
or to the trustee or trustees under any indenture under which any instruments
evidencing any of such Senior Indebtedness may have been issued, ratably as
aforesaid, for application to the payment of all Senior Indebtedness remaining
unpaid until all such Senior Indebtedness shall have been paid in full, after
giving effect to any concurrent payment or distribution to the holders of such
Senior Indebtedness or provision therefor.
SECTION 1004. Subrogation
Subject to the payment in full of all Senior Indebtedness, the Holders
shall be subrogated to the rights of the holders of Senior Indebtedness to
receive payments or distributions of cash, property or securities of the Company
applicable to the Senior Indebtedness until all amounts owing on the Securities
shall be paid in full, and, as between the Company, its creditors other than
holders of Senior Indebtedness and the Holders, no such payment or distribution
made to the holders of Senior Indebtedness by virtue of this Article 10 which
otherwise would have been made to the Holders shall be deemed to be a payment by
the Company on account of the Senior Indebtedness, it being understood that the
provisions of this Article 10 are and are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand, and the holders of
Senior Indebtedness on the other hand.
SECTION 1005. Obligation of Company Unconditional
Nothing contained in this Article 10 or elsewhere in this Indenture or
in the Securities is intended to or shall impair, as between the Company, its
creditors other than the holders of Senior Indebtedness and the Holders, the
obligation of the Company, which is absolute and unconditional, to pay to the
Holders the principal of and interest on the Securities as and when the same
shall become due and payable in accordance with their terms, or affect the
relative rights of the Holders and creditors of the Company other than the
holders of Senior Indebtedness, nor shall anything herein or therein prevent the
Trustee or the Holder of any Securities from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article 10 of the holders of Senior Indebtedness in
respect of cash, property or securities of the Company received upon the
exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to
in this Article 10, the Trustee and the Holders shall be entitled to rely upon
any order or decree made by any court of competent jurisdiction in which any
such dissolution, winding-up, liquidation or reorganization proceeding affecting
the affairs of the Company is pending or upon a certificate of the liquidating
trustee or agent or other person making any payment or distribution to the
Trustee or to the Holders for the purpose of ascertaining the persons entitled
to participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount paid or distributed therein and all other facts
pertinent thereto or to this Article 10.
SECTION 1006. Payments on Securities Permitted
Nothing contained in this Indenture, or in any of the Securities, shall
affect the obligation of the Company to make, or prevent the Company from
making, payments of principal of or interest on the Securities, except as
otherwise provided in this Article 10.
SECTION 1007. Effectuation of Subordination by Trustee
28
<PAGE> 33
Each Holder of Securities, by his or her acceptance thereof, authorizes
and directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article 10 and appoints the Trustee such Holder's attorney-in-fact for any and
all such purposes.
SECTION 1008. Trustee Not Charged with Knowledge of Prohibition
Notwithstanding the provisions of this Article or any other provision
of this Indenture, but subject to the provisions of Section 601 as between the
Holders of Securities and the Trustee, neither the Trustee nor any Paying Agent
shall be charged with knowledge of any facts which would prohibit the making of
any payment of moneys to or by the Trustee or any such Paying Agent, unless and
until the Trustee or such Paying Agent shall have received written notice
thereof at its Corporate Trust Office from the Company or any holder of Senior
Indebtedness or the trustee or representative of any holder of such Senior
Indebtedness on his behalf; and, prior to the receipt of any such written
notice, the Trustee and any such Paying Agent shall be entitled to assume that
no such facts exist. If the Trustee or Paying Agent, as the case may be, shall
not have received, at least five Business Days prior to the date upon which by
the terms hereof any such moneys may become payable for any purpose (including,
without limitation, the payment of the principal of, premium, if any, or the
interest on any Security) with respect to such moneys, the notice provided for
in this Section, then, anything herein contained to the contrary
notwithstanding, the Trustee and such Paying Agent, as the case may be, shall
have full power and authority to receive such moneys and to apply the same to
the purpose for which they were received and shall not be affected by any notice
to the contrary which may be received by it within five Business Days prior to
such date.
SECTION 1009. Trustee May Hold Senior Indebtedness
The Trustee shall be entitled to all the rights set forth in this
Article 10 with respect to any Senior Indebtedness at the time held by it, to
the same extent as any other holder of Senior Indebtedness and nothing in
Section 6.13 or elsewhere in this Indenture shall deprive the Trustee of any of
its rights as such holder. Nothing in this Article shall apply to claims of, or
payments to, the Trustee under or pursuant to Sections 506 or 607.
SECTION 1010. Rights of Holders of Senior Indebtedness Not Impaired
No right of any present or future holder of any Senior Indebtedness to
enforce the subordination herein shall at any time or in any way be prejudiced
or impaired by any act or failure to act on the part of the Company or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof any such holder may have or be
otherwise charged with.
29
<PAGE> 34
SECTION 1011. Rights and Obligations Subject to Power of Court
The right of the holders of Senior Indebtedness and the obligations of
the Trustee and the Noteholders set forth in this Article 10 are subject to the
power of a court of competent jurisdiction to make other equitable provision
reflecting the rights conferred in this Indenture upon the Senior Indebtedness
and the holders thereof with respect to the Securities and the Holders thereof
by a plan of reorganization under applicable bankruptcy law.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the day and year first above written.
TruServ Corporation
By: _________________________
Vice President
U.S. Bank Trust
National Association
By: _________________________
Vice President
30
