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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): March 23, 1995
JONES INTERCABLE, INC.
(Exact name of registrant as specified in its charter)
Colorado 1-9953 84-0613514
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(State of Organization) (Commission File No.) (IRS Employer
Identification No.)
P.O. Box 3309
9697 E. Mineral Avenue, Englewood, CO 80155-3309
----------------------------------------------------
(Address of principal executive office and Zip Code)
Registrant's telephone number, including area code (303) 792-3111
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Item 5. Other Events.
Pursuant to its effective Registration Statement (No. 33-64604)
allowing it to offer up to $500,000,000 aggregate principal amount of
debentures, notes and/or other unsecured evidences of indebtedness
consisting of senior debt securities, senior subordinated debt securities
and subordinated debt securities, Jones Intercable, Inc. (the "Company")
sold $200,000,000 of its 9 5/8% Senior Notes Due 2002 (the "Notes"). The
Notes were sold on March 23, 1995. The Notes are payable semiannually on
March 15 and September 15 of each year, commencing September 15, 1995. The
Notes will mature on March 15, 2002. The Notes will not be redeemable
prior to maturity.
The Company anticipates that the net proceeds from the offering of the
Notes will be used for the acquisition of a cable television system serving
the areas in and around Augusta, Georgia (the "Augusta System"), owned by
Cable TV Fund 12-B, Ltd., one of the Company's managed limited
partnerships. The purchase price for the Augusta System is $141,718,000.
The Augusta System is contiguous with the cable television system owned by
the Company serving areas in and around North Augusta, South Carolina. The
closing of the acquisition of the Augusta System, which is expected to
close in late summer 1995, is subject to a number of conditions, including
the approval of the holders of a majority of the limited partnership
interests in the selling partnership. The Company believes that the
approval of the limited partners will be received.
The remaining net proceeds, together with cash on hand or funds
available under the Company's revolving credit facility, will be used to
acquire the cable television systems serving Manassas, Manassas Park,
Haymarket and portions of unincorporated Prince William County, all in
Virginia (the "Virginia Systems"), from a third party. The purchase price
for the Virginia Systems is $71,100,000, subject to normal closing
adjustments. The acquisition of the Virginia Systems is subject to a
number of conditions, including the negotiation of a definitive agreement,
the approval of the applicable governmental authorities to the transfer of
the franchises for the Virginia Systems, the approval of the Department of
Justice and the Federal Trade Commission pursuant to the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, and the consent of various other third
parties. The Company believes that the acquisition of the Virginia
Systems, if completed, will add to its present presence in the Washington,
D.C./Baltimore metropolitan area where the Company owns or manages, on
behalf of certain of its limited partnerships, cable television systems.
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If either acquisition is not completed, the unused net proceeds will
be used for the acquisition of other cable television systems either from
among those currently owned by the Company's managed partnerships or from
unrelated third parties or for general corporate purposes. Pending any
such use of the proceeds, the proceeds will be invested temporarily in
interest-bearing short-term securities.
Item 7. Financial Statements and Exhibits
(a) Not applicable.
(b) Not applicable.
(c) Exhibits.
1.1 Underwriting Agreement Basic Provisions dated March 15,
1995.
1.2 Terms Agreement dated as of March 15, 1995, between the
Company and Salomon Brothers Inc, Morgan Stanley & Co.
Incorporated and PaineWebber Incorporated.
4.1 Indenture dated March 23, 1995 with respect to the Senior
Notes, between the Company and U.S. Trust Company of
California, N.A. (the "Trustee").
4.2 First Supplemental Indenture dated as of March 23, 1995 with
respect to $200,000,000 aggregate principal amount of the
Company's 9 5/8% Senior Notes due 2002, between the Company
and the Trustee.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
JONES INTERCABLE, INC.
Dated: March 23, 1995 By: /s/ Elizabeth M. Steele
Elizabeth M. Steele
Vice President
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibit Numbered
No. Description Page
-------- ----------- ------------
<S> <C> <C>
1.1 Underwriting Agreement Basic Provisions dated March 15,
1995.
1.2 Terms Agreement dated as of March 15, 1995, between the
Company and Salomon Brothers Inc, Morgan Stanley & Co.
Incorporated and PaineWebber Incorporated.
4.1 Indenture dated March 23, 1995 with respect to the Senior
Notes, between the Company and U.S. Trust Company of
California, N.A. (the "Trustee").
4.2 First Supplemental Indenture dated as of March 23, 1995 with
respect to $200,000,000 aggregate principal amount of the
Company's 9 5/8% Senior Notes due 2002, between the Company
and the Trustee.
</TABLE>
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JONES INTERCABLE, INC.
DEBT SECURITIES
UNDERWRITING AGREEMENT BASIC PROVISIONS
March 15th, 1995
To the Representative or Representatives
named in the Terms Agreement referred to
below
Jones Intercable, Inc., a Colorado corporation (the
"Company"), may issue and sell from time to time its debt securities consisting
of senior debt securities ("Senior Debt Securities"), senior subordinated debt
securities ("Senior Subordinated Debt Securities") and subordinated debt
securities ("Subordinated Debt Securities"; the Senior Debt Securities, the
Senior Subordinated Debt Securities and the Subordinated Debt Securities being
collectively referred to as the "Securities") registered under the registration
statement referred to in Section 2(a) hereof. Such Securities may have varying
designations, denominations, interest rates and payment dates, maturities,
redemption provisions and selling prices. The Securities may be convertible,
as described in the Indentures (as defined below), into shares of the Company's
Class A Common Stock, $.01 par value (the "Class A Common Stock"). The basic
provisions set forth herein are intended to be incorporated by reference in a
terms agreement of the type referred to in Section 1 hereof relating to the
designation (including whether Senior Debt Securities, Senior Subordinated Debt
Securities or Subordinated Securities and whether, and on what terms, such
Securities are convertible) and series of Securities to be issued and sold by
the company pursuant thereto (the "Offered Securities") to the several
underwriters named therein (the "Underwriters"). The Senior Debt Securities
will be issued under an indenture (the "Senior Debt Securities Indenture"), to
be entered into between the Company and U.S. Trust Company of California, N.A.,
as trustee (the "Senior Debt Securities Indenture Trustee"); the Senior
Subordinated Debt Securities will be issued under an indenture (the "Senior
Subordinated Debt Securities Indenture") entered into between the Company and
First Trust National Association, as trustee (the "Senior Subordinated Debt
Securities Indenture Trustee"); the Subordinated Debt Securities will be issued
under an indenture (the "Subordinated Debt Securities Indenture") to be entered
into between the Company and Bank of America National Trust and Savings
Association, as trustee (the "Subordinated Debt Securities Indenture Trustee")
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(the Senior Debt Securities Indenture, the Senior Subordinated Debt Securities
Indenture and the Subordinated Debt Securities Indenture pursuant to which the
Offered Securities are issued are individually referred to as an "Indenture";
the Senior Debt Securities Indenture Trustee, the Senior Subordinated Debt
Securities Indenture Trustee and the Subordinated Debt Securities Indenture
Trustee are individually referred to as a "Trustee" and collectively referred
to as the "Trustees"). The Terms Agreement relating to the Offered Securities
(the "Terms Agreement"), together with the provisions hereof incorporated
therein by reference (which provisions shall not become effective until so
incorporated by reference), is herein referred to as this "Agreement." If the
Underwriters consist only of the firm or firms referred to in the Terms
Agreement as Representative or Representatives, then the terms "Underwriters"
and "Representatives," as used herein, shall each be deemed to refer to such
firm or firms.
1. Terms Agreement. The obligation of the Underwriters
to purchase, and the Company to sell, the Offered Securities is evidenced by
the Terms Agreement delivered at the time the Company determines to sell the
Offered Securities. The Terms Agreement specifies the firm or firms which will
be Underwriters, the principal amount of the Offered Securities to be purchased
by each Underwriter, the purchase price to be paid by the Underwriters for the
Offered Securities, the public offering price, if any, of the Offered
Securities, whether, and on what terms, the Offered Securities are convertible
into shares of Class A Common Stock, whether the Underwriters are authorized to
solicit institutional investors to purchase Offered Securities pursuant to
Delayed Delivery Contracts (as hereinafter defined), certain terms thereof and
the Underwriters' compensation therefor and any terms of the Offered Securities
not otherwise specified in the applicable Indenture (including, but not limited
to, designations, denominations, interest rates and payment dates, maturity,
redemption provisions and sinking fund requirements) and such other terms that
may be decided between the Company and the Underwriters as specified in the
Terms Agreement. The Terms Agreement specifies any details of the terms of the
offering that should be reflected in a post-effective amendment to the
Registration Statement or the Prospectus Supplement (each as hereinafter
defined).
2. Representations and Warranties of the Company. The
Company represents and warrants to and agrees with each Underwriter that:
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(a) A registration statement on Form S-3,
including a prospectus, with respect to the Securities and the shares
of Class A Common Stock that may be issuable upon conversion of any
convertible Securities, (i) has been prepared by the Company in
conformity with the requirements of the Securities Act of 1933, as
amended (the "Act") and the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the
"Commission") thereunder, (ii) has been filed with the Commission and
(iii) has become effective. Such registration statement and
prospectus may have been amended or supplemented from time to time
prior to the date of this Agreement; any such amendment to the
Registration Statement was so prepared and filed and any such
amendment has become effective. A prospectus supplement (the
"Prospectus Supplement"), including a prospectus, relating to the
Offered Securities has been so prepared. The Prospectus Supplement,
and if not previously filed, such prospectus will be filed pursuant to
Rule 424 under the Act within the time prescribed by such Rule. Copies
of such registration statement and prospectus, any such amendment or
supplement, the Prospectus Supplement and all documents incorporated
by reference therein which were filed with the Commission on or prior
to the date of the Terms Agreement (including one fully executed copy
of the registration statement and of each amendment thereto for
counsel for the Underwriters) have been delivered to you. Such
registration statement and prospectus, as amended or supplemented to
the date of the Terms Agreement and as supplemented by the Prospectus
Supplement are herein referred to as the "Registration Statement" and
the "Prospectus," respectively. Any reference herein to the
Registration Statement or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein which were
filed with the Commission on or prior to the date of the Terms
Agreement and any reference to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement or the
Prospectus shall be deemed to refer to and include, except with
respect to Paragraph 5(d) hereof, the filing of any document with the
Commission deemed to be incorporated by reference therein after the
date of the Terms Agreement and on or prior to the Closing Date.
(b) The Registration Statement, at the time it
became effective, any post-effective amendment thereto, at the time it
became effective, the Registration Statement and the Prospectus, as of
the date of the Terms Agreement and at the Closing Date (as
hereinafter defined),
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and any amendment or supplement thereto, conformed or will conform in
all material respects to the requirements of the Act, the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act") and the
Rules and Regulations; and no such document included or will include
an untrue statement of a material fact or omitted or will omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided that the Company
makes no representation or warranty as to information contained in or
omitted from the Registration Statement or the Prospectus in reliance
upon and in conformity with written information furnished to the
Company by or on behalf of any Underwriter specifically for inclusion
therein or information contained in the Statements of Eligibility
on Form T-1 of the Trustees other than information furnished to the
Trustees by the Company specifically for inclusion therein.
(c) The documents incorporated by reference in
the Registration Statement or the Prospectus, when they became
effective or were filed with the Commission, as the case may be, under
the Securities Exchange Act of 1934 (the "Exchange Act"), conformed,
and any documents so filed and incorporated by reference after the
date of the Terms Agreement and on or prior to the Closing Date will,
when they are filed with the Commission, will conform, in all material
respects to the requirements of the Act and the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder.
(d) Neither the Company nor any of its
subsidiaries (as defined in Paragraph 12) is in violation of its
corporate charter or by-laws, in the case of the Company and its
corporate subsidiaries, or the applicable limited partnership
agreement, in the case of the Company's affiliated partnerships, or in
default under any agreement, indenture or instrument, the effect of
which violation or default would constitute a Material Adverse Effect;
neither the issuance or sale of the Offered Securities or the issuance
of the shares of Class A Common Stock upon conversion of any
convertible Offered Securities nor the consummation of any other of
the transactions contemplated herein or in the Delayed Delivery
Contracts nor fulfillment of the terms hereof or thereof or of the
Indenture will conflict with, or result in the creation or imposition
of any lien, charge or encumbrance, which in either case would have a
Material Adverse Effect upon any of the assets of the Company or any
of its subsidiaries pursuant to the terms of, or constitute a default
under, any
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agreement, indenture or instrument, or result in a violation of the
corporate charter or by-laws of the Company, in the case of the
Company and its corporate subsidiaries, or the applicable limited
partnership agreement, in the case of the Company's affiliated
partnerships, or any order, rule or regulation of any court or
governmental agency having jurisdiction over the Company, any of its
subsidiaries or their property, the effect of which default or
violation would constitute a Material Adverse Effect; and except as
required by the Act, the Exchange Act, the Trust Indenture Act, and
applicable state securities laws, no consent, authorization or order
of, or filing or registration with, any court or governmental agency
is required for the execution, delivery and performance of this
Agreement.
(e) Except as described in or contemplated by the
Registration Statement and the Prospectus, subsequent to the
respective dates as of which information is given in the Registration
Statement and the Prospectus, there has not been any Material Adverse
Effect in, or any adverse development which materially affects, the
business, franchises, properties, financial condition, results of
operations or prospects of the Company and its subsidiaries and its
interests in its affiliated partnerships taken as a whole.
(f) The Indenture relating to the Offered
Securities has been validly authorized and, when executed by the
proper officers of the Company (assuming the due execution and
delivery thereof by the Trustee) and delivered by the Company, will
constitute the legally binding obligation of the Company, subject to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting the enforcement of creditors'
rights and to general equity principles; the Offered Securities have
been validly authorized, and, upon due execution, authentication and
delivery against payment therefore in accordance with the provisions
of this Agreement, the Indenture (and, in the case of any Contract
Securities, as contemplated by the Delayed Delivery Contracts with
respect thereto) will be validly issued and outstanding, and will
constitute legally binding obligations of the Company, subject to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting the enforcement of creditors'
rights and to general equity principles, entitled to the benefits of
the Indenture; and the Offered Securities, and any shares of Class A
Common Stock issuable upon conversion of any Offered Securities, and
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the Indenture will conform to the descriptions thereof contained in
the Registration Statement and the Prospectus.
(g) Any convertible Offered Securities are
convertible into shares of Class A Common Stock in accordance with the
terms of the Indenture relating to such Offered Securities; the
appropriate number of shares of Class A Common Stock initially
issuable upon conversion of any such Offered Securities in accordance
with the terms of the Indenture have been duly authorized and reserved
for issuance, and will, when issued in accordance with the terms of
the Indenture, be validly issued, fully paid and non-assessable with
no personal liability attaching to the ownership thereof; and none of
the shares of Class A Common Stock into which any such Offered
Securities will be convertible will be subject to any preemptive
right, or any lien, charge or encumbrance or any other claim of any
third party.
(h) Each of the Company and its subsidiaries has
been duly incorporated, and each of the Company's affiliated
partnerships has been duly formed, and are validly existing and in
good standing as corporations, in the case of the Company and its
corporate subsidiaries, or as limited partnerships, in the case of its
affiliated partnerships, under the laws of their respective
jurisdictions of incorporation, or formation, and are duly qualified
to do business and in good standing as a foreign corporation or
partnership in each jurisdiction in which their respective ownership
or lease of property or the conduct of their respective business
requires such qualification (except where the failure so to qualify
would not have a Material Adverse Effect), and has all corporate or
partnership power and authority necessary to own or hold their
respective properties and to conduct the business in which they are
engaged. Except as described in the Registration Statement and the
Prospectus, all of the outstanding shares of each of the Company's
corporate subsidiaries are owned by the Company directly, or
indirectly through wholly-owned subsidiaries, free and clear of any
liens, claims, equities or encumbrances, except liens, claims,
equities or encumbrances arising in connection with bank indebtedness
incurred in the ordinary course of business, have been duly authorized
and are validly issued and outstanding, fully paid and non-assessable.
(i) Except as set forth in or contemplated by the
Registration Statement or the Prospectus, there is no material
litigation or
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governmental proceeding pending or, to the knowledge of the Company,
threatened against the Company or any of its subsidiaries which, if
determined adversely to the Company or any of its corporate
subsidiaries or affiliated partnerships, would result in any Material
Adverse Effect or which is required to be disclosed in the
Registration Statement and the Prospectus.
(j) The financial statements and schedules and
information of the Company incorporated by reference in the
Registration Statement and Prospectus fairly present the financial
condition and results of operations of the entities purported to be
shown thereby, at the dates and for the periods indicated, and have
been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved. Arthur Andersen & Co., who have examined such financial
statements, as set forth in their reports incorporated by reference in
the Registration Statement and the Prospectus, are independent public
accountants within the meaning of the Act and the Rules and
Regulations.
(k) There are no contracts or other documents
which are required to be filed as exhibits to the Registration
Statement by the Act or by the Rules and Regulations which have not
been filed as exhibits to the Registration Statement.
(l) The Company and each of its subsidiaries own
or possess adequate licenses or other rights to use all patents,
trademarks, service marks, trade names, copyrights and know-how
necessary to conduct the business now or proposed to be operated by
them as described in the Prospectus, and, except as described in the
Prospectus, neither the Company nor any of its subsidiaries has
received any notice of infringement of or conflict with (or know of
any such infringement of or conflict with) asserted rights of others
with respect to any patents, trademarks, service marks, trade names,
copyrights or know-how which is likely to be sustained and, if such
infringement or conflict were sustained, would result in any Material
Adverse Effect.
(m) The Company and its subsidiaries have filed
all necessary federal, state and foreign income and franchise tax
returns and have paid all taxes shown as due thereon; and there is no
tax deficiency
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that has been asserted against the Company or any of its subsidiaries
that would result in any Material Adverse Effect.
(n) The Company and its subsidiaries have good
and marketable title to all properties and assets described in the
Prospectus as owned by them free and clear of all liens, charges,
encumbrances, or restrictions, except, with respect to the Company and
its corporate subsidiaries, as set forth in the Prospectus and, with
respect to the Company's affiliated partnerships, liens, charges,
encumbrances, and restrictions arising in connection with bank debt
incurred in the ordinary course of business; to the best of the
Company's knowledge all of the material leases, licenses and franchise
agreements under which the Company and its subsidiaries hold or use
tangible or intangible properties or assets as lessee, licensee or
franchisee are in full force and effect and no material claim has been
asserted by anyone adverse to their rights as lessee, licensee or
franchisee under any of such leases, licenses or franchise agreements,
or affecting or questioning their right to the continued possession or
use of the leased, licensed or franchised tangible or intangible
property or assets under any such lease, license or franchise
agreement which claim is likely to be sustained and, if sustained,
would have a Material Adverse Effect.
(o) The Company maintains a system of internal
accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management's general
or specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity
with generally accepted accounting principles and to maintain
accountability for assets, (iii) access to assets is permitted only in
accordance with management's general or specific authorization, and
(iv) the recorded accountability for assets is compared with existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(p) Neither the Company nor any of its
subsidiaries is an "investment company" or a company "controlled" by
an "investment company" within the meaning of the Investment Company
Act of 1940, as amended (the "40 Act").
(q) (i) The property, assets and operations of
the Company and its subsidiaries comply in all material respects with
all
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applicable Environmental Laws (as defined below) (except to the extent
that failure to comply with such Environmental Laws would not have a
Material Adverse Effect), (ii) to the knowledge of the Company after
reasonable inquiry, none of the property, assets or operations of the
Company or its subsidiaries is the subject of any federal, state or
local investigation evaluating whether any remedial action is needed
to respond to a release of any Hazardous Materials (as defined below)
into the environment or is in contravention of any federal, state or
local law, order or regulation that would have a Material Adverse
Effect, (iii) neither the Company nor any of its subsidiaries has
received any notice or claim, nor are there pending, threatened or
reasonably anticipated lawsuits against them, with respect to
violations of an Environmental Law or in connection with any release
of any Hazardous Materials into the environment that would result in a
Material Adverse Effect, and (iv) neither the Company nor any of its
subsidiaries has any material contingent liability (material to the
Company and its subsidiaries and its interests in its affiliated
partnerships taken as a whole) in connection with any release of any
Hazardous Materials into the environment (as used herein,
"Environmental Laws" means any federal, state, territorial, provincial
or local law, common law doctrine, rule, order, decree, judgment,
injunction, license, permit or regulation relating to environmental
matters, and "Hazardous Materials" means those substances that are
regulated by or form the basis of liability under any Environmental
Laws).
(r) Neither the Company nor any of the
subsidiaries is involved in any labor dispute nor, to the best
knowledge of the Company, is any dispute imminent, other than routine
disciplinary and grievance matters.
3. Purchase, Sale and Delivery of Securities. The
Offered Securities to be purchased by the Underwriters will be delivered by the
Company to you for the accounts of the several Underwriters at the office
specified in the Terms Agreement against payment of the purchase price therefor
by certified or official bank check or checks in New York Clearing House funds
(or as otherwise specified in the Terms Agreement) payable to the order of the
Company on the date and at the times specified in the Terms Agreement, or at
such other time not later than eight full business days thereafter as you and
the Company determine, such time being herein referred to as the "Closing
Date." The Offered Securities will be prepared in definitive form and in such
authorized
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denominations and registered in such names as you may require upon at least two
business days' prior notice to the Company and will be made available for
checking and packaging at the office at which they are to be delivered on the
Closing Date (or such other office as may be specified for that purpose in the
Terms Agreement) at least one business day prior to the Closing Date.
It is understood that you, acting individually and not in a
representative capacity, may (but shall not be obligated to) make payment to
the Company on behalf of any other Underwriter for the Offered Securities to be
purchased by such Underwriter. Any such payment by you shall not relieve any
such Underwriter of any of its obligations hereunder.
The Company will pay you on the Closing Date for the accounts
of the Underwriters any fee, commission or other compensation specified in the
Terms Agreement. Such payment will be made by certified or official bank check
in New York Clearing House funds.
If so authorized in the Terms Agreement, the Underwriters may
solicit offers from investors of the types set forth in the Prospectus to
purchase Offered Securities from the Company pursuant to delayed delivery
contracts ("Delayed Delivery Contracts"). Such contracts shall be
substantially in the form of Exhibit I hereto but with such changes therein as
the Company may approve. Offered Securities to be purchased pursuant to
Delayed Delivery Contracts are herein called "Contract Securities." When
Delayed Delivery Contracts are authorized in the Terms Agreement, the Company
will enter into a Delayed Delivery Contract in each case where a sale of
Contract Securities arranged through you has been approved by the Company but,
except as the Company may otherwise agree, such Delayed Delivery Contracts must
be for at least the minimum amount of Contract Securities set forth in the
Terms Agreement. You will advise the Company of the proposed sales of the
Contract Securities not later than 10:00 A.M., New York City time on the third
full business day preceding the Closing Date (or at such later time as the
Company may otherwise agree). The Company will advise you not later than 10:00
A.M., New York City time, on the second full business day preceding the Closing
Date (or at such later time as you may otherwise agree) of the sales of the
Contract Securities which have been so approved. You and the other
Underwriters will not have any responsibility in respect of the validity or
performance of Delayed Delivery Contracts.
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The amount of Offered Securities to be purchased by each
Underwriter as set forth in the Terms Agreement shall be reduced by an amount
which shall bear the same proportion to the total amount of Contract Securities
as the amount of Offered Securities set forth opposite the name of such
Underwriter bears to the total amount of Offered Securities set forth in the
Terms Agreement, except to the extent that you determine that such reduction
shall be otherwise than in such proportion and so advise the Company; provided,
however, that the total amount of Offered Securities to be purchased by all
Underwriters shall be the total amount of Offered Securities set forth in the
Terms Agreement less the aggregate amount of Contract Securities.
4. Substitution of Underwriters. (a) The Company shall
not be obligated to deliver any Offered Securities except upon payment for all
the Offered Securities to be purchased hereunder or as hereinafter provided.
(b) If any Underwriter or Underwriters shall fail
to take up and pay for the principal amount of Offered Securities agreed by
such Underwriter or Underwriters to be purchased hereunder, upon tender of such
Offered Securities in accordance with the terms hereof, and the principal
amount of Offered Securities not purchased does not aggregate more than 10% of
the total principal amount of the Offered Securities set forth in the Terms
Agreement, the remaining Underwriters shall be obligated to take up and pay for
(in proportion to their respective underwriting obligations hereunder as set
forth in the Terms Agreement, except as may otherwise be determined by you) the
Offered Securities which the withdrawing or defaulting Underwriters agreed but
failed to purchase.
(c) If any Underwriter or Underwriters shall fail
to take up and pay for the principal amount of Offered Securities agreed by
such Underwriter or Underwriters to be purchased hereunder, upon tender of such
Offered Securities in accordance with the terms hereof, and the principal.
amount of Offered Securities not purchased aggregates more than 10% of the
total principal amount of Offered Securities set forth in the Terms Agreement,
and arrangements satisfactory to you and the Company for the purchase of such
Offered Securities by other persons are not made within 36 hours thereafter,
this Agreement shall terminate.
(d) In the event of a default by any Underwriter
as set forth in this Paragraph 4, the Closing Date shall be postponed for such
period, not to exceed seven full business days, as you shall determine in order
that the
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required changes in the Registration Statement and the Prospectus or in any
other documents or arrangements may be effected. In the event of any such
termination, the Company shall not be under any liability to any Underwriter
(except to the extent provided in Paragraphs 5(j) and 9 hereof) nor shall any
Underwriter (other than an Underwriter who shall have failed, otherwise than
for some reason permitted under this Agreement, to purchase the principal
amount of Offered Securities agreed by such Underwriter to be purchased under
this Agreement) be under any liability to the Company (except to the extent
provided in Paragraph 9 hereof). Nothing contained in this Agreement shall
relieve any defaulting Underwriter of its liability, if any, to the Company and
any non-defaulting Underwriter for damages occasioned by its default hereunder.
5. Covenants. The Company agrees:
(a) To furnish promptly to you and to counsel for
the Underwriters a signed copy of the Registration Statement and the
Prospectus (including all documents incorporated by reference therein)
as originally filed, and each amendment thereto filed with the
Commission, including all consents and exhibits filed therewith and
all documents incorporated by reference therein;
(b) To deliver promptly to you and to each
Underwriter such number of conformed copies of the Registration
Statement as originally filed and each amendment thereto (excluding
exhibits other than this Agreement), the Prospectus and any amended or
supplemented Prospectus as you may reasonably request;
(c) To cause the Prospectus Supplement to be
filed pursuant to Rule 424 under the Act within the time prescribed
therein and to notify you promptly of such filing;
(d) At any time when a prospectus relating to the
Offered Securities is required to be delivered under the Act, prior
to filing with the Commission, any amendment to the Registration
Statement or subsequent supplement to the Prospectus, or to filing any
prospectus pursuant to Rule 424 of the Rules and Regulations, to
furnish a copy thereof to you and counsel for the Underwriters and
obtain your consent to the filing;
(e) To advise you promptly (i) when any amendment
to the Registration Statement has become effective or any subsequent
supplement to the Prospectus has been filed, (ii) of any request or
<PAGE> 13
-13-
proposed request by the Commission for any amendment to the
Registration Statement, a supplement to the Prospectus or for any
additional information, (iii) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement
or the initiation or threat of any stop order proceedings, (iv) of
receipt by the Company of any notification with respect to the
suspension of the qualification of the Offered Securities for sale in
any jurisdiction or the initiation or threat of any proceeding for
that purpose, and (v) of the happening of any event which makes untrue
any statement of a material fact made in the Registration Statement or
the Prospectus, or which requires the making of a change in the
Registration Statement or the Prospectus in order to make any material
statement therein not misleading;
(f) Within the time during which a prospectus
relating to the Offered Securities is required to be delivered under
the Act, the Company will comply as far as it is able with all
requirements imposed upon it by the Act, as now and hereafter amended,
and by the Rules and Regulations, as from time to time in force, so
far as necessary to permit the continuance of sales of or dealings in
the Offered Securities as contemplated by the provisions hereof and
the Prospectus. If during such period any event occurs as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances then existing, not misleading, or if during such period
it is necessary to amend or supplement the Registration Statement or
the Prospectus to comply with the Act, the Company will amend or
supplement the Registration Statement or the Prospectus (at the
expense of the Company) so as to correct such statement or omission or
effect such compliance;
(g) The Company will make generally available to
its securities holders and to you as soon as practicable, but in any
event not later than 15 months after the end of the Company's current
fiscal quarter, an earnings statement (which need not be audited)
covering a 12-month period beginning after the date upon which the
Prospectus Supplement is filed pursuant to Rule 424 under the Act
which shall satisfy the provisions of Section 11(a) of the Act;
<PAGE> 14
-14-
(h) So long as the Offered Securities are
outstanding, to furnish to you copies of all public reports and all
reports and financial statements furnished by the Company to any
securities exchange pursuant to requirements of or agreements with any
such exchange or to the Commission pursuant to the Exchange Act or any
rule or regulation of the Commission thereunder;
(i) To endeavor in all reasonable respects to
qualify the Offered Securities for offer and sale under the securities
laws of such jurisdictions as you may reasonably request;
(j) To pay the costs incident to the
authorization, issuance, sale and delivery of the Offered Securities
and any taxes payable in that connection; the costs incident to the
preparation, printing and filing under the Act of the Registration
Statement and any amendments and exhibits thereto; the costs of
distributing to the Underwriters and any selected dealers the
Registration Statement as originally filed and each amendment thereto
and any post-effective amendments thereof (including exhibits), the
Prospectus and any amendment or supplement to the Prospectus as
provided in this Agreement; the costs of printing this Agreement; the
costs of filings and clearance with the National Association of
Securities Dealers, Inc. (including the reasonable fees and
disbursements of counsel for the Underwriters related thereto); the
fees paid to rating agencies in connection with the rating of the
Offered Securities; the reasonable fees and expenses of qualifying the
Offered Securities under the securities laws of the several
jurisdictions as provided in this Paragraph and of preparing and
printing a Blue Sky Memorandum (including related fees and expenses of
counsel for the Underwriters); and all other costs and expenses
incident to the performance of the obligations of the Company under
this Agreement, including, without limitation, the fees of the
Trustee, the cost of printing and engraving the certificates
representing the Securities, the cost of their personnel and other
internal costs, and all expenses and taxes incident to the sale and
delivery of the Securities to you; provided that, except as provided
in this Paragraph or in the Terms Agreement, the Underwriters shall
pay their own costs and expenses, including the fees and expenses of
their counsel; any transfer taxes on the Offered Securities which they
may sell and the expenses of advertising any offering of the Offered
Securities made by the Underwriters; and
<PAGE> 15
-15-
(k) The Company will not, without your consent,
offer or sell, or publicly announce its intention to offer or sell any
debt securities having a maturity of more than one year (except under
prior contractual commitments) during the period beginning on the date
of the Terms Agreement and ending the business day following the
Closing Date. If the Offered Securities are convertible into shares
of Class A Common Stock, the Company will comply with any similar (or
additional) restrictions on offers and sales of the Company's Class A
Common Stock, or other equity securities or securities convertible
into or exercisable for equity securities that may be specified in the
Terms Agreement. The Company has not taken, and will not take,
directly or indirectly, any action which might reasonably be expected
to cause or result in the stabilization or manipulation of the price
of any security to facilitate the sale or resale of the Offered
Securities.
6. Indemnification. (a) The Company shall indemnify and
hold harmless each Underwriter, the directors, officers, agents and employees
of each Underwriter and each person, if any, who controls any Underwriter
within the meaning of the Act from and against any loss, claim, damage or
liability, joint or several, and any action in respect thereof, to which
that Underwriter or controlling person may become subject, under the Act
or otherwise, insofar as such loss, claim, damage, liability or action arises
out of, or is based upon, any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement when it became effective,
the Registration Statement or the Prospectus, or any related preliminary
prospectus supplement, or arises out of, or is based upon, the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and shall reimburse
each Underwriter and each such controlling person for any legal and other
expenses reasonably incurred by that Underwriter or controlling person in
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action; provided that the Company shall not be liable in
any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in any preliminary prospectus or
in the Registration Statement or the Prospectus or any amendment or supplement
thereto in reliance upon and in conformity with written information furnished
to the Company by or on behalf of any Underwriter specifically for inclusion
therein; and, provided further, that as to any preliminary prospectus
supplement this indemnity agreement shall not inure to the benefit of any
Underwriter or any person controlling that Underwriter on account of any loss,
claim, damage, liability or action arising
<PAGE> 16
-16-
from the sale of Offered Securities to any person by the Underwriter if that
Underwriter failed to send or give a copy of the Prospectus, as the same may
be amended or supplemented, to that person within the time required by the Act,
and the untrue statement or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact in such preliminary
prospectus supplement was corrected in the Prospectus. The foregoing indemnity
agreement is in addition to any liability which the Company may otherwise have
to any Underwriter or any controlling person of that Underwriter.
(b) Each Underwriter (severally, but not jointly) shall
indemnify and hold harmless the Company, each of its directors, each of its
officers who signed the Registration Statement and any person who controls the
Company within the meaning of the Act from and against any loss, claim, damage
or liability, joint or several, and any action in respect thereof, to which the
Company or any such director, officer or controlling person may become subject,
under the Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement when it
became effective, the Registration Statement or the Prospectus, or any related
preliminary prospectus supplement, or arises out of, or is based upon, the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
that Underwriter specifically for inclusion therein, and shall reimburse the
Company and any such officer, director or controlling person for any legal and
other expenses reasonably incurred by the Company or any such director, officer
or controlling person in investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action. The foregoing
indemnity agreement is in addition to any liability which any Underwriter may
otherwise have to the Company or any of its directors, officers or controlling
persons.
(c) Promptly after receipt by an indemnified party under
this Paragraph of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under this Paragraph, notify the indemnifying party in
writing of the claim or the commencement of that action, provided that the
failure to notify the indemnifying party shall not relieve it from any
liability
<PAGE> 17
-17-
which it may have to an indemnified party except to the extent that the
failure to give notice has materially prejudiced the indemnifying party. If
any such claim or action shall be brought against an indemnified party, and it
shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein, and, to the extent that it wishes, jointly
with any other similarly notified indemnifying party, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party. After
notice from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying party shall not be
liable to the indemnified party under this Paragraph for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof; provided that the indemnified party shall have the right to
employ counsel to represent such indemnified party who may be subject to
liability arising out of any claim in respect of which indemnity may be sought
by the indemnified party against the indemnifying party under this Paragraph,
if in the reasonable judgment of the indemnified party, it is advisable for
such indemnified party to be represented by separate counsel, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless (i) the employment of counsel by such indemnified party has been
authorized by the indemnifying party, (ii) the named parties to any such action
(including any impleaded parties) include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be one or more legal defenses available to the indemnified party
which are different from or additional to those available to the indemnifying
party (in which case the indemnifying party shall not have the right to direct
the defense of such action on behalf of the indemnified party) or (iii) the
indemnifying party shall not in fact have employed counsel to assume the
defense of such action, in each of which cases the fees and expenses of such
separate counsel shall be paid by the indemnifying party. An indemnifying party
will not, without the prior written consent of the indemnified parties, settle
or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding.
(d) If the indemnification provided for in this Paragraph
shall for any reason be unavailable to an indemnified party under Paragraph
6(a) or 6(b) in respect of any loss, claim, damage or liability, or any action
in respect thereof, referred to therein, then each indemnifying party shall, in
lieu of indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage or
liability, or action in respect thereof, (i) in such proportion as shall be
appropriate to reflect the relative benefits received by the Company on the one
hand and the Underwriters on the other from the offering of the Offered
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand
<PAGE> 18
-18-
and the Underwriters on the other with respect to the statements or omissions
which resulted in such loss, claim, damage or liability, or action in respect
thereof, as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the Underwriters on the
other with respect to such offering shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Offered
Securities (before deducting expenses) received by the Company bear to the
total underwriting discounts and commissions received by the Underwriters with
respect to such offering, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact relates to information
supplied by the Company or the Underwriters, the intent of the parties and
their relative knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriters agree
that it would not be just and equitable if contributions pursuant to this
Paragraph were to be determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other
method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an
indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Paragraph shall be deemed
to include, for purposes of this Paragraph, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Paragraph, no Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Offered Securities
underwritten by it and distributed to the public was offered to the public
exceeds that amount of any damages which such Underwriter has otherwise paid or
become liable to pay by reason of any untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Paragraph 6(d) are several in proportion to their respective underwriting
obligations and not joint.
(e) The indemnity agreements contained in this Paragraph
and the representations, warranties and agreements of the Company in Paragraphs
2 and 5 shall survive the delivery of the Offered Securities and shall remain
in full force and effect, regardless of any termination or cancellation of this
Agreement or any investigation made by or on behalf of any indemnified party.
<PAGE> 19
-19-
7. Effective Date of Agreement and Termination. (a) This
Agreement shall become effective on the day on which this Agreement is
executed.
(b) The obligations of the Underwriters hereunder may be
terminated by you, in your absolute discretion, by notice given to and received
by the Company prior to delivery of and payment for the Offered Securities, if
prior to that time (i) since the respective date as of which information is
given in the Registration Statement and the Prospectus, any adverse change or
development involving a prospective adverse change in the financial condition
of the Company and its subsidiaries taken as a whole or the earnings or
business affairs of the Company and its subsidiaries taken as a whole, whether
or not arising in the ordinary course of business, which would, in your
judgment, make it impracticable to market the Securities on the terms and in
the manner contemplated in the Prospectus, (ii) any outbreak or escalation of
hostilities or other national or international calamity or crises, if the
effect of such outbreak, escalation, calamity, or crisis would, in your
judgment, make the offering or delivery of the Offered Securities
impracticable, (iii) existing financial, political, economic or stock market
conditions in Europe, the United States or elsewhere, or international monetary
conditions, shall have undergone a material change which, in your judgment,
materially and adversely affects the market for the Offered Securities or makes
the offering or delivery of the Offered Securities impracticable; (iv) the
suspension or material limitation of trading in securities on the New York
Stock Exchange, the American Stock Exchange or the NASDAQ National Market
System or limitation on prices for securities on any such exchange or National
Market System, (v) the enactment, publication, decree or other promulgation of
any federal or state statute, regulation, rule or order of any court or other
governmental authority which in your opinion materially and adversely affects,
or will materially and adversely affect, the business or operations of the
Company or any subsidiary, (vi) the declaration of a banking moratorium by
either federal or New York State authorities or (vii) the taking of any action
by any federal, state or local government or agency in respect of its monetary
or fiscal affairs which in your opinion has a material adverse effect on the
financial markets in the United States.
8. Conditions of the Underwriters' Obligations. The obligations
of the Underwriters to purchase and pay for the Offered Securities as provided
herein are subject to the accuracy, as of the date of the Terms Agreement and
the Closing Date (as if made at the Closing Date) of the representations and
warranties of the Company contained herein, to performance by the Company of
<PAGE> 20
-20-
its obligations thereunder, and to each of the following additional terms and
conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement shall have been issued, and prior to that time
no stop order proceeding shall have been initiated or threatened (and
such threat shall not have been withdrawn) by the Commission; any
request by the Commission for inclusion of additional information in
the Registration Statement or the Prospectus or otherwise shall have
been complied with; and the Company shall not have filed with the
Commission the Prospectus or any amendment or supplement to the
Registration Statement or the Prospectus without the consent of the
Representatives; and
(b) All corporate proceedings and other legal matters
incident to the authorization and validity of this Agreement, the
Terms Agreement, the Indenture and the authorization, form and
validity of the Offered Securities and the shares of Class A Common
Stock issuable upon conversion of any convertible Offered Securities
and the form of the Registration Statement and the Prospectus, other
than financial statements and other financial data, and all other
legal matters relating to this Agreement and the transactions
contemplated hereby shall be satisfactory in all respects to
Cahill Gordon & Reindel, counsel for the Underwriters, and the Company
shall have furnished to such counsel all documents and information
that they may reasonably request to enable them to pass upon such
matters.
(c) Counsel to the Company shall have furnished to you
their opinion addressed to the Underwriters and dated the Closing Date
to the effect that:
(i) Such counsel has no reason to believe that
any material licenses, permits, franchises and authorizations
of the Company and its subsidiaries and affiliated
partnerships are not in full force and effect and that the
Company and its subsidiaries and affiliated partnerships are
not in all material respects complying therewith.
(ii) The Company has been duly incorporated and is
validly existing in good standing as a corporation under the
laws of the State of Colorado, with corporate power and
authority to own
<PAGE> 21
-21-
its properties and conduct its business as now documented and
described in the Prospectus, and is duly qualified to do
business as a foreign corporation and in good standing in all
other jurisdictions where the ownership or leasing of its
properties or the conduct of its business requires such
qualifications, except where the failure to be so qualified
will not have a Material Adverse Effect.
(iii) Each of the Company's subsidiaries has been
duly incorporated and is validly existing in good standing as
a corporation under the laws of its jurisdiction of
incorporation, with corporate power and authority to own its
properties and conduct its business as now conducted and
described in the Prospectus, and is duly qualified to do
business as a foreign corporation and in good standing in all
other jurisdictions where the ownership or leasing of its
properties or the conduct of its business requires such
qualification, except where the failure to be so qualified
will not have a Material Adverse Effect. The outstanding
shares of capital stock of each of the Company's subsidiaries
have been duly authorized and validly issued, are fully paid
and nonassessable and are owned, directly or indirectly, by
the Company free and clear of all liens, encumbrances,
equities and claims, except as set forth in the Prospectus or
except liens, encumbrances, equities and claims arising in
connection with bank indebtedness incurred in the ordinary
course of business.
(iv) Each of the Company's affiliated partnerships
has been duly formed and is validly existing in good standing
as a limited partnership under the laws of its jurisdiction of
formation, with power and authority to own its properties and
conduct its business as now conducted and described in the
Prospectus, and is duly qualified to do business as a foreign
limited partnership and in good standing in all other
jurisdictions where the ownership or leasing of its properties
or the conduct of its business requires such qualification,
except where the failure to be so qualified will not have a
Material Adverse Effect.
(v) The execution, delivery and performance of
this Agreement and any Delayed Delivery Contract by the
Company, consummation by the Company of the transactions
herein contemplated and compliance by the Company with the
provisions
<PAGE> 22
-22-
of the Indenture and the Offered Securities and if, the
Offered Securities are convertible, the shares of Class A
Common Stock issuable upon conversion of the Offered
Securities, will not conflict with, or result in the creation
or imposition of any lien, charge or encumbrance upon any of
the assets of the Company or any of its subsidiaries pursuant
to the terms of, or constitute or result in a breach or
violation of, or default under, the articles of incorporation
or bylaws of the Company or any of its subsidiaries, or the
respective certificates of or agreements of limited
partnership of any of the Company's affiliated partnerships,
or any indenture, mortgage, deed of trust, loan agreement,
lease or other agreement or instrument known to such counsel,
to which the Company or any of its subsidiaries or affiliated
partnerships is a party or by which it or any of them or their
respective properties may be bound, or any law or statute or
any judgment, decree, order, rule or regulation of any court,
governmental agency or other body applicable to the Company or
any of its subsidiaries or affiliated partnerships of any of
their respective properties. (In the case of any law, order,
rule or regulation relating to the Federal Communications Act
or the Federal Communications Commission, such counsel may
rely upon the opinion of Dow, Lohnes & Albertson, Washington,
D.C.)
(vi) The Indenture has been validly authorized by
the Company and is a valid and legally binding instrument of
the Company, subject to bankruptcy, insolvency, fraudulent
conveyance, reorganization and other laws of general
applicability relating to or affecting the enforcement of
creditors' rights and to general equity principles.
(vii) The Agreement and the Offered Securities have
been validly authorized and duly executed by authorized
officers of the Company, and when duly authenticated and
delivered by the Trustee in accordance with the provisions of
the Indenture (and, in the case of any Contract Securities, in
accordance with the provisions of the Delayed Delivery
Contracts with respect thereto), will be validly issued and
legally binding obligations of the Company, subject to
bankruptcy, insolvency, fraudulent conveyance, reorganization
and other laws of general applicability
<PAGE> 23
-23-
relating to or affecting the enforcement of creditors' rights
and to general equity principles, entitled to the benefits of
the Indenture.
(viii) If the Offered Securities are convertible,
the Offered Securities are convertible into shares of Class A
Common Stock in accordance with the terms of the Indenture;
the appropriate number of shares of Class A Common Stock
initially issuable upon conversion of the Offered Securities
in accordance with the terms of the Indenture have been duly
authorized and reserved for issuance, and will, when issued in
accordance with the terms of the Indenture, be validly issued,
fully paid and non-assessable with no personal liability
attaching to the ownership thereof; and none of the shares of
Class A Common Stock into which the Offered Securities will be
convertible will be subject to any preemptive right, or any
lien, charge or encumbrance or any other claim of any third
party.
(ix) The Offered Securities, and, if the Offered
Securities are convertible, the shares of Class A Common Stock
issuable upon conversion of the Offered Securities, and the
Indenture conform as to legal matters to the statements
concerning them in the Registration Statement and the
Prospectus.
(x) The Registration Statement is effective under
the Act and the Indenture has been qualified under the Trust
Indenture Act, and no stop order suspending its effectiveness
has been issued, and, to the knowledge of such counsel, no
proceeding for that purpose is pending or threatened by the
Commission.
(xi) To the best of the knowledge of such counsel,
there is not pending or threatened any action, suit,
proceeding, inquiry or investigation to which the Company or
any of its subsidiaries or affiliated partnerships is a party,
or to which the property of the Company or any of its
subsidiaries or affiliated partnerships is subject, before or
brought by any court or governmental agency or body, except as
described in the Prospectus and except for litigation incident
to the kind of business conducted by the Company and its
subsidiaries and affiliated partnerships which, individually
or in the aggregate, will not have a Material Adverse Effect.
<PAGE> 24
-24-
(xii) Such counsel has no reason to believe that
the Company and its subsidiaries and affiliated partnerships
have not obtained all licenses, permits, franchises and other
governmental authorizations (in the case of any law, order,
rule or administrative regulation relating to the Federal
Communications Act or the Federal Communications Commission,
such counsel may rely upon the opinion of Dow, Lohnes &
Albertson, Washington, D.C.), the lack of which would have a
Material Adverse Effect.
(xiii) Such counsel does not know of any litigation
or any governmental proceeding pending or threatened against
the Company of any of its subsidiaries which would affect the
subject matter of this Agreement or the Terms Agreement or is
required to be disclosed in the Prospectus which is not
disclosed and correctly summarized therein.
(xiv) To the best of such counsel's knowledge,
neither the Company nor any of its subsidiaries is in default
under any material agreement, indenture or instrument or in
violation of its corporate charter or bylaws.
(xv) Neither the Company nor any of its
subsidiaries is an "investment company" or a company
"controlled" by an "investment company" within the meaning of
the 40 Act.
(xvi) Such counsel does not know of any contracts
or other documents which are required to be filed as exhibits
to the Registration Statement by the Act, the Exchange Act or
by the rules and regulations which have not been filed as
exhibits to the Registration Statement or incorporated therein
by reference as permitted by the Rules and Regulations.
(xvii) The Statements made by the Prospectus under
the captions "Description of the Debt Securities" and
"Description of Capital Stock," insofar as they constitute a
summary of the provisions of documents or agreements
specifically referred to therein, fairly present the
information called for with respect thereto by Form S-3.
<PAGE> 25
-25-
In addition, as part of their opinion letter, such counsel
shall advise that, except as to financial statements and FCC
regulatory matters as to which such counsel need not express any
opinion, such counsel (A) is of the opinion that the Registration
Statement, all Preliminary Prospectuses, the Prospectus and any
supplements or amendments thereto, as of their respective effective or
issue dates, complied as to form in all material respects with the
Act, the applicable Rules and Regulations and the Trust Indenture Act,
(B) that the documents incorporated by reference in the Prospectus,
when they were filed with the Commission, complied as to form in all
material respects with the requirements of the Exchange Act and the
Rules and Regulations thereunder, (C) believes that the descriptions
in the Registration Statement and the Prospectus of statutes,
contracts and other documents, and to the best knowledge of such
counsel, all descriptions of legal or governmental proceedings and
legislative proposals (in the case of any law, order, rule or
administrative regulation relating to the Federal Communications Act
or the Federal Communications Commission, such counsel may rely upon
the opinion of Dow, Lohnes & Albertson, Washington, D.C.), are
accurate and present fairly the information required to be presented
by the Act or the Rules and Regulations and (D) although such counsel
is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and Prospectus (relying as to materiality to a
large extent upon the opinions of officers, counsel and other
representatives of the Company) nothing has come to such counsel's
attention which would lead such counsel to believe that the
Registration Statement and the Prospectus (and any amendments or
supplements thereto), as of their respective effective or issue dates
or as of the date hereof, or the documents incorporated by reference
therein at the time they were filed, contained an untrue statement of
a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading,
or that the Prospectus (if amended or supplemented), as of the Closing
Date, contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading.
In rendering such opinion, such counsel may rely, (A) as to
matters of fact, upon statements and certificates from officers of the
Company, public officials and other sources reasonably believed by
such counsel to
<PAGE> 26
-26-
be reliable, and (B) as to matters of law of jurisdictions other than
jurisdictions in which such counsel are admitted to the practice of
law upon opinions of other counsel reasonably acceptable to the
Underwriters; provided such counsel shall furnish the Underwriters
copies of any such opinions.
(d) Dow, Lohnes & Albertson, as special counsel to the
Company, shall have furnished to you their opinion addressed to the
Underwriters and dated the Closing Date to the effect that with
respect to matters arising under the Communications Act of 1934, as
amended, and the rules and regulations of the Federal Communications
Commission (the "FCC"):
(i) No approval of the FCC is required in
connection with the issuance and sale of the Offered
Securities;
(ii) Based on due inquiry and investigation as
described in such opinion, the Company and its subsidiaries
have such licenses relating to the cable communications
industry as are necessary under the Communications Act or
1934, as amended, and the rules and regulations of the FCC to
own their cable television systems and to conduct their cable
television business in the manner described in the Prospectus
except where the failure to have or comply with such licenses
would have a materially adverse effect on the business or
financial condition of the Company and its subsidiaries as a
whole, and such licenses contain no burdensome restrictions
not adequately described in the Prospectus, which restrictions
would have a materially adverse effect on the Company and its
subsidiaries as a whole.
(iii) The execution, delivery and performance of
this Agreement by the Company and compliance by the Company
with the provisions of the Indenture and the Offered
Securities does not and will not violate the Communications
Act of 1934, as amended, or the rules and regulations of the
FCC;
(iv) Except for matters described in the
Registration Statement, such counsel does not know of any
proceeding before the FCC to which the Company or any of its
subsidiaries is a party or involving the cable television
systems, licenses or authorizations
<PAGE> 27
-27-
of the Company or its subsidiaries, or of any cable
communications law or regulation relevant to such systems,
licenses or authorizations required pursuant to SEC Regulation
S-K to be described in the Registration Statement or the
Prospectus which is not described as required;
(v) The statements made in the Company's most
recent Annual Report on Form 10-K filed with the Commission
under the caption "Regulation and Legislation" and as updated
in the Prospectus under the caption "Risk Factors-Government
Regulation of the Cable Television Industry" and "Telephone
Company Competition," insofar as they purport to summarize
current and proposed federal legislation and regulations of
the FCC and certain court decisions specifically referred to
therein, have been reviewed by such counsel and such counsel
has no reason to believe that such sections of the
Registration Statement, as of the effective date of the
Registration Statement and as of the Closing Date, contain any
untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to
make such statements not misleading.
(e) You shall have received from Cahill Gordon & Reindel,
or such other counsel for the Underwriters designated in the
Terms Agreement ("Counsel for the Underwriters"), an opinion or
opinions, dated the Closing Date, covering the matters referred to in
sub-heading (vi), (vii) and (x) of paragraph (c) of this Section 6
and such other related matters as you may require, and the Company
shall have furnished to such counsel such documents as they request
for the purpose of enabling them to pass upon such matters. In
rendering such opinion, such counsel may rely, as to the incorporation
of the Company and as to all other matters governed by the laws of the
State of Colorado, upon the opinion of counsel for the Company
referred to above.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of
the Company, counsel for the Company, representatives of the
independent certified public accountants of the Company and
representatives of the Underwriters at which the contents of the
Registration Statement and Prospectus and related matters were
discussed and, although such counsel is not passing upon and does not
assume any responsibility for the
<PAGE> 28
-28-
accuracy, completeness or fairness of the statements contained in the
Registration Statement and Prospectus, on the basis of the foregoing
(relying as to materiality to a large extent upon the opinions of
officers, counsel and other representatives of the Company), no facts
have come to the attention of such counsel which lead such counsel to
believe that either the Registration Statement, as of the date of this
Agreement, or the Prospectus, as of the date of the Prospectus
Supplement, and any amendments or supplements thereto (except
amendments or supplements relating to securities that are not Offered
Securities), as of their respective effective or issue dates,
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading (it being understood that such
counsel need make no comment with respect to the financial statements
and other financial and statistical information included in the
Registration Statement or Prospectus).
(f) The Company shall have furnished to you on the
Closing Date a certificate, dated the Closing Date, of its President
and its principal accounting officer stating that:
(i) The representations, warranties and
agreements of the Company in Paragraph 2 are true and correct
as of the Closing Date; the Company has complied with all its
agreements contained herein; and the conditions set forth in
Paragraph 8(a) have been fulfilled; and
(ii) They have carefully examined the Registration
Statement and the Prospectus and, in their opinion, (A) as of
the effective date of the Registration Statement, the
Registration Statement and Prospectus did not include any
untrue statement of a material fact and did not omit to state
a material fact required to be stated therein or necessary to
make the statements therein not misleading, and (B) since the
effective date of the Registration Statement, no event has
occurred which should have been set forth in a supplement to
or amendment of the Prospectus which has not been set forth in
such a supplement or amendment.
(g) The Company shall have furnished to you on the
Closing Date a letter, in form and substance satisfactory to you, of
Arthur Andersen & Co., addressed to the Underwriters and dated the
Closing
<PAGE> 29
-29-
Date, confirming that they are independent public accountants within
the meaning of the Act and are in compliance with the applicable
requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission, and containing statements
and information of the type ordinarily included in accountants
"comfort letters" to underwriters with respect to financial statements
and certain financial information contained in or incorporated by
reference in the Registration Statement and the Prospectus.
(h) The Company shall have obtained such agreements
regarding the sale of the Company's Class A Common Stock, other equity
securities or securities convertible into or exercisable for equity
securities as may be specified in the Terms Agreement relating to
convertible Securities.
(i) After the execution and delivery of this Agreement,
there shall not have been any downgrading in the ratings of the
Company's debt securities by any "nationally recognized statistical
rating agency" (as defined in Rule 426(g) under the Act) or any notice
given thereby of, or any other action thereby threatening, any
intended or potential downgrading in any such rating or of a possible
change in any such rating that does not indicate the direction of the
possible change or any action thereby placing the Company under
special surveillance.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance
satisfactory to counsel for the Underwriters.
9. Expenses of Underwriters. If the Company shall fail to tender
the Offered Securities for delivery to the Underwriters for any reason
permitted under this Agreement, or if the Underwriters shall decline to
purchase the Offered Securities for any reason permitted under this Agreement
other than as set forth in Paragraph 4 or Paragraph 7(b), the Company shall
reimburse the Underwriters for the reasonable fees and expenses of their
counsel and for such other out-of-pocket expenses as shall have been incurred
by them in connection with this Agreement and the proposed purchase of the
Offered Securities, and upon demand the Company shall pay the full amount
thereof to the Underwriters.
10. Notices. All notices or communications hereunder shall be
sufficient if in writing and if sent to you shall be mailed, delivered or
telegraphed and confirmed to you at your address set forth for that purpose in
the Terms Agreement. Any notice by the Underwriters to the Company shall be
sufficient if given in writing or by telegraph addressed to the Company at 9697
East Mineral Avenue, Englewood, Colorado 80112, Attention of the General
Counsel.
<PAGE> 30
-30-
11. Parties. This agreement shall inure to the benefit of and be
binding upon the Underwriters, the Company and their respective successors.
This Agreement and the terms and provisions hereof are for the sole benefit of
only those persons, except that (a) the representations, warranties,
indemnities and agreements of the Company contained in this Agreement shall
also be deemed to be for the benefit of the person or persons, if any, who
control any Underwriter within the meaning of Section 15 of the Act, and (b)
the indemnity agreement of the Underwriters contained in Paragraph 6 of this
Agreement shall be deemed to be for the benefit of directors of the Company,
officers of the Company who have signed the Registration Statement and any
person controlling the Company. Nothing in this Agreement is intended or shall
be construed to give any person other than the persons referred to in this
Paragraph any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision contained herein.
12. Certain Definition. For purposes of this Agreement, (a)
"business day" means any day on which the New York Stock Exchange, Inc. is open
for trading, (b) "subsidiary" has the meaning set forth in Rule 405 of the
Rules and Regulations and shall include affiliated partnerships only if the
Company or one of its corporate subsidiaries is a general partner of such
partnership, (c) "affiliate" has the meaning set forth in Rule 144 of the Rules
and Regulations and (d) "Material Adverse Effect" means a material adverse
effect, financial or otherwise, on the Company and its subsidiaries and its
interests and its affiliated partnerships taken as a whole.
13. Governing Law; Counterparts. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York. This
Agreement may be executed in one or more counterparts, and if executed in more
than one counterpart the executed counterparts shall together constitute a
single instrument.
<PAGE> 31
EXHIBIT I
JONES INTERCABLE, INC.
{Insert specific title of securities*}
DELAYED DELIVERY CONTRACT
{Insert date of initial public offering}*
JONES INTERCABLE, INC.
c/o*
Gentlemen:
The undersigned hereby agrees to purchase from Jones
Intercable Inc. (hereinafter called the "Company"), and the Company agrees to
sell to the undersigned. {If one delayed closing, insert -- as of the date
hereof, for delivery on _____________, 19_____ ("Delivery Date")}
{$} __________________
principal amount of the Company's {title of Securities} (the "Securities"),
offered by the Company's Prospectus relating thereto, receipt of a copy of
which is hereby acknowledged, at a purchase price of ____% of the principal
amount thereof plus accrued interest, if any, and on the further terms and
conditions set forth in this contract.
{If two or more delayed closings, insert the following:
_________________
* To be completed when the Terms Agreement is executed by the parties thereto.
<PAGE> 32
-2-
The undersigned will purchase from the Company as of the date
hereof, for delivery on the dates set forth below, Securities in the principal
amounts set forth below:
<TABLE>
<CAPTION>
Delivery Date Principal Amount
------------- ----------------
<S> <C>
</TABLE>
Each of such delivery dates is hereinafter referred to as a Delivery Date.}
Payment for the Securities which the undersigned has agreed to
purchase for delivery on {the} {each} Delivery Date shall be made to the
Company or its order by certified or official bank check in New York Clearing
House funds (as otherwise specified in the Terms Agreement) at the office of
_________________________ at __.m., _________ time, on such Delivery Date upon
delivery to the undersigned of the Securities to be purchased by the
undersigned for delivery on such Delivery Date in definitive form and in such
denominations and registered in such names as the undersigned may designate by
written or telegraphic communication addressed to the Company not less than
five full business days prior to such Delivery Date. If no designation is
received, the Securities will be registered in the name of the undersigned and
issued in a denomination equal to the aggregate principal amount of Securities
to be purchased by the undersigned on such Delivery Date.
The obligation of the undersigned to take delivery of, and
make payment for, Securities on {the} {each} Delivery Date shall be subject
only to the condition that (1) investment in the Securities shall not at such
Delivery Date be prohibited under the laws of any jurisdiction in the United
States to which the undersigned is subject, which investment the undersigned
represents is not prohibited on the date hereof and (2) the Company shall have
delivered to the Underwriters the principal amount of the Securities to be
purchased by them pursuant to the Underwriting Agreement referred to in the
Prospectus mentioned above and received payment therefor. The obligation of
the undersigned to take delivery of and make payment for Securities hereunder,
and the obligation of the Company to sell and deliver Securities hereunder,
shall not be affected by the failure of any purchaser to take delivery of and
make payment for Securities pursuant to other contracts similar to this
contract. As a material inducement to the acceptance of this offer by the
Company, the undersigned represents and
<PAGE> 33
-3-
warrants to you that its investment in the Securities which the undersigned
hereby offers to purchase is not, as of the date hereof, prohibited under the
laws of any jurisdiction to which the undersigned is subject and which govern
such investment, and the undersigned will, if the Securities are being
purchased by the undersigned under a "basket" clause or similar authorization,
use its best efforts to reserve an amount thereunder sufficient to permit such
purchase on the Delivery Date.
Promptly after completion of the sale to the Underwriters, the
Company will mail or deliver to the undersigned at its address set forth below
notice to such effect, accompanied by a copy of the opinion of counsel for the
Company delivered to the Underwriters in connection therewith.
By execution hereof, the undersigned represents and warrants
to the Company that all necessary corporate action for the due execution and
delivery of this contract and the payment for and purchase of the Securities
which the undersigned hereby offers to purchase has been taken by it and no
further authorization or approval of any governmental or other regulatory
authority is required for such execution, delivery, payment or purchase, and
that, upon acceptance hereof by the Company and mailing or delivery of a copy
as provided below, this contract will constitute a valid and binding agreement
of the undersigned in accordance with its terms.
This contract will inure to the benefit of and be binding upon
the parties hereto and their respective successors, but will not be assignable
by either party hereto without the written consent of the other.
It is understood that the acceptance of this contract and any
other similar contracts is in the Company's sole discretion and, without
limiting the foregoing, need not be on a first come-first served basis. If
this contract is acceptable to the Company, it is requested that the Company
sign the form of acceptance below and mail or deliver one of the counterparts
hereof to the undersigned at its address set forth below. This will become a
binding contract between the Company and the undersigned when such counterpart
is mailed or delivered.
This contract shall be governed by, and construed in
accordance with, the laws of the State of New York.
<PAGE> 34
-4-
Very truly yours,
(Name of Purchaser)
By
(Title of Signatory)
(Address of Purchaser)
Accepted, as of the above date.
JONES INTERCABLE, INC.
By
(Title of Signatory)
<PAGE> 1
TERMS AGREEMENT
March 15, 1995
Jones Intercable, Inc.
9697 East Mineral Avenue
Englewood, CO 80112
Attn: Mr. Kevin Coyle
Dear Sirs:
We (the "Underwriters") understand that Jones Intercable, Inc., a Colorado
corporation (the "Company"), proposes to issue and sell $200,000,000 aggregate
principal amount of its senior debt securities (the "Underwritten Securities").
Subject to the terms and conditions set forth herein or incorporated by
reference herein, the Underwriters named in Schedule I hereto offer to
purchase, severally and not jointly, the principal amounts of such Underwritten
Securities set forth opposite their names in such list at 98.25% of the
principal amount thereof (plus accrued interest, if any, on the Underwritten
Securities from March 23, 1995 to Closing Date). The Closing Date shall be
March 23, 1995, at 10 a.m. at the offices of Cahill Gordon & Reindel, 80 Pine
Street, New York, New York 10005.
The Underwritten Securities shall have the terms set forth in the
Prospectus dated July 9, 1993, and the Prospectus Supplement dated March 16,
1995, including the following:
Title: 9-5/8% Senior Notes Due 2002
Maturity: March 15, 2002
Interest Rate: 9-5/8%
Interest Payment Dates: March 15 and September 15
Redemption Provisions: Not redeemable prior to maturity
Public Offering Price: 100.0% of principal amount, plus accrued
interest, if any, from March 23, 1995
All the provisions contained in the document entitled "Jones Intercable,
Inc. -- Debt Securities -- Underwriting Agreement Basic Provisions" and dated
March 15, 1995 (the "Basic Provisions"), a copy of which you have previously
received, are herein incorporated by reference in their entirety and shall be
deemed to be a part of this Terms Agreement to the same extent as if the Basic
Provisions had been set forth in full herein, except as provided for below.
Terms defined in the Basic Provisions are used herein as therein defined.
<PAGE> 2
-2-
Please accept this offer no later than nine o'clock a.m. on March 16,
1995, by signing a copy of this Terms Agreement in the space set forth below
and returning the signed copy to us, or by sending us a written acceptance in
the following form:
"We hereby accept your offer, set forth in the Terms Agreement, dated
March 16, 1995, to purchase the Underwritten Securities on the terms set forth
therein."
Very truly yours,
SALOMON BROTHERS INC
MORGAN STANLEY & CO. INCORPORATED
PAINEWEBBER INCORPORATED
By Salomon Brothers Inc
By: /s/ RICHARD ZOGHEB
Richard Zogheb
Vice President
Seven World Trade Center
New York, New York 10048
Attention: Richard Zogheb
Accepted:
JONES INTERCABLE, INC.
By: /s/ ELIZABETH M. STEELE
Elizabeth M. Steele
Vice President/General Counsel
<PAGE> 3
SCHEDULE I
<TABLE>
<CAPTION>
Principal Amount
of Securities to
Underwriters Be Purchased
- ------------ ----------------
<S> <C>
Salomon Brothers Inc . . . . . . . . . . . . . . . $100,000,000
Morgan Stanley & Co. Incorporated . . . . . . . . . 50,000,000
PaineWebber Incorporated . . . . . . . . . . . . . 50,000,000
------------
Total . . . . . . . . . . . . . . . . . . . . . $200,000,000
</TABLE>
<PAGE> 1
_______________________________________________________________________________
JONES INTERCABLE, INC.
AND
U.S. TRUST COMPANY OF CALIFORNIA, N.A.
Trustee
____________________
INDENTURE
Dated as of March 23, 1995
____________________
Senior Debt Securities
_______________________________________________________________________________
<PAGE> 2
RECONCILIATION AND TIE SHEET
between
Provisions of the Trust Indenture Act of 1939
and
Indenture, Dated as of March 23, 1995
between
JONES INTERCABLE, INC.
and
U.S. TRUST COMPANY OF CALIFORNIA, N.A.
Trustee
<TABLE>
<CAPTION>
Section of Act Section of Debenture
- -------------- --------------------
<S> <C>
310(a)(1).................................... 8.09
310(a)(2).................................... 8.09
310(a)(3).................................... Inapplicable
310(a)(4).................................... Inapplicable
310(a)(5).................................... 8.08
310(b)....................................... 8.08, 8.10
310(c)....................................... Inapplicable
311(a)....................................... 8.13(a), 8.13(c)
311(b)....................................... 8.13(b), 8.13(c)
311(c)....................................... Inapplicable
312(a)....................................... 6.01, 6.02(a)
312(b)....................................... 6.02(b)
312(c)....................................... 6.02(c)
313(a)....................................... 6.04(a)
313(b)(1).................................... Inapplicable
313(b)(2).................................... 6.04(b)
313(c)....................................... 6.04(c)
313(d)....................................... 6.04(d)
314(a)(1).................................... 6.03(a)
314(a)(2).................................... 6.03(b)
314(a)(3).................................... 6.03(c)
314(a)(4).................................... 5.05
314(b)....................................... Inapplicable
314(c)(1).................................... 15.05
314(c)(2).................................... 15.05
314(c)(3).................................... Inapplicable
314(d)....................................... Inapplicable
314(e)....................................... 15.05
314(f)....................................... Omitted
315(a)....................................... 8.01
315(b)....................................... 7.07
315(c)....................................... 8.01
315(d)....................................... 8.01
315(e)....................................... 7.08
316(a)(1).................................... 7.06, 9.04
316(a)(2).................................... Omitted
316(b)....................................... 7.04
316(c)....................................... 9.05
317(a)....................................... 7.02
</TABLE>
-i-
<PAGE> 3
<TABLE>
<S> <C>
317(b)....................................... 5.04(a)
318(a)....................................... 15.07
318(b)....................................... 15.07
318(c)....................................... 15.07
</TABLE>
-ii-
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Parties............................................................. 1
ARTICLE ONE
Definitions
Section 1.01 Certain terms defined............................. 1
Affiliated Partnership............................ 2
Board of Directors................................ 2
Board Resolution.................................. 2
Business Day...................................... 2
Capital Stock..................................... 2
Company........................................... 2
Company Order..................................... 2
Convertible Securities............................ 3
Corporate Trust Office............................ 3
Defaulted Interest................................ 3
Event of Default.................................. 3
Indenture......................................... 3
interest.......................................... 3
Interest Payment Date............................. 3
Maturity.......................................... 3
Officers' Certificate............................. 3
Opinion of Counsel................................ 4
Original Issue Discount Security.................. 4
Person............................................ 4
Place of Payment.................................. 4
Predecessor Security.............................. 4
Regular Record Date............................... 4
Reporting Date.................................... 4
Responsible Officer............................... 5
Security or Securities; outstanding............... 5
Securityholder; holder of Securities;
registered holder............................... 6
Security Register................................. 6
Significant Subsidiary............................ 6
Special Record Date............................... 6
Stated Maturity................................... 6
Subsidiary........................................ 6
Trustee; principal corporate trust office......... 6
Trust Indenture Act of 1939, as amended........... 7
Section 1.02 References are to Indenture....................... 7
</TABLE>
-iii-
<PAGE> 5
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Section 1.03 Security Forms.................................... 7
ARTICLE TWO
The Securities
Section 2.01 Amount Unlimited; Issuable in Series.............. 8
Section 2.02 Denominations..................................... 11
Section 2.03 Execution, Authentication,
Delivery and Dating............................. 11
Section 2.04 Payment of Interest; Interest
Rights Preserved................................ 12
Section 2.05 Persons Deemed Owners............................. 14
Section 2.06 Computation of Interest........................... 14
Section 2.07 Exchange of Securities............................ 14
Section 2.08 Temporary Securities.............................. 15
Section 2.09 Mutilated, destroyed, lost or stolen
Securities...................................... 16
Section 2.10 Cancellation of surrendered Securities............ 17
ARTICLE THREE
INTENTIONALLY OMITTED
ARTICLE FOUR
Redemption of Securities - Sinking Fund
Section 4.01 Applicability of Article.......................... 18
Section 4.02 Notice of redemption; selection of
Securities...................................... 18
Section 4.03 When Securities called for redemption become
due and payable................................. 19
Section 4.04 Sinking Fund...................................... 20
Section 4.05 Redemption of Securities for Sinking Fund......... 20
Section 4.06 Redemption in Event of Default.................... 21
Section 4.07 Manner of redeeming Securities.................... 22
Section 4.08 Cancellation of redeemed Securities............... 22
</TABLE>
-iv-
<PAGE> 6
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE FIVE
Particular Covenants of the Company
Section 5.01 Payment of principal of and interest on
Securities...................................... 22
Section 5.02 Maintenance of office or agency for
registration of transfer, exchange and
payment of Securities........................... 23
Section 5.03 Appointment to fill a vacancy in the office
of Trustee...................................... 23
Section 5.04 Provision as to paying agent...................... 23
Section 5.05 Officers' Certificates as to default.............. 24
ARTICLE SIX
Securityholders' lists and reports by
the Company and the Trustee
Section 6.01 Company to furnish Trustee information as to
names and addresses of Securityholders.......... 25
Section 6.02 Preservation and disclosure of lists.............. 26
Section 6.03 Reports by the Company............................ 27
Section 6.04 Reports by the Trustee............................ 28
ARTICLE SEVEN
Remedies of the Trustee and Securityholders
On Event of Default
Section 7.01 Events of Default defined......................... 30
Section 7.02 Payment of Securities on default; suit
therefor........................................ 32
Section 7.03 Application of moneys collected by Trustee........ 34
Section 7.04 Limitations on suits by holders of
Securities...................................... 35
Section 7.05 Proceedings by Trustee; remedies cumulative
and continuing.................................. 36
Section 7.06 Rights of holders of majority in principal
amount of Securities to direct Trustee and
to waive defaults............................... 37
</TABLE>
-v-
<PAGE> 7
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Section 7.07 Trustee to give notice of defaults known to
it, but may withhold in certain
circumstances.................................. 37
Section 7.08 Requirements of an undertaking to pay costs
in certain suits under the Indenture or
against the Trustee............................ 38
ARTICLE EIGHT
Concerning the Trustee
Section 8.01 Duties and responsibilities of Trustee........... 39
Section 8.02 Reliance on documents, opinions, etc............. 40
Section 8.03 No responsibility for recitals, etc.............. 42
Section 8.04 Trustee, paying agent or Security registrar
may own Securities............................. 42
Section 8.05 Moneys received by Trustee to be held in
trust without interest......................... 42
Section 8.06 Compensation and expenses of Trustee............. 43
Section 8.07 Right of Trustee to rely on Officers'
Certificate where no other evidence
specifically prescribed........................ 43
Section 8.08 Conflicting interest of Trustee.................. 44
Section 8.09 Requirements for eligibility of Trustee.......... 51
Section 8.10 Resignation or removal of Trustee................ 52
Section 8.11 Acceptance of Appointment by Successor........... 53
Section 8.12 Successor to Trustee by merger,
consolidation or succession to business........ 55
Section 8.13 Limitations on rights of Trustee as a
creditor....................................... 56
ARTICLE NINE
Concerning the Securityholders
Section 9.01 Evidence of action by securityholders............ 61
Section 9.02 Proof of execution of instrument and of
holding of Securities.......................... 61
Section 9.03 Who may be deemed owners of Securities........... 62
</TABLE>
-vi-
<PAGE> 8
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Section 9.04 Securities owned by Company or controlled or
controlling persons disregarded for
certain purposes............................... 62
Section 9.05 Record date for action by securityholders........ 63
Section 9.06 Instruments executed by securityholders bind
future holders................................. 63
ARTICLE TEN
Securityholders' Meetings
Section 10.01 Purposes for which meetings may be called........ 64
Section 10.02 Manner of calling meetings; record date.......... 65
Section 10.03 Call of meeting by Company or
securityholders................................ 65
Section 10.04 Who may attend and vote at meetings.............. 66
Section 10.05 Regulations...................................... 66
Section 10.06 Manner of voting at meeting and record to be
kept........................................... 67
Section 10.07 Exercise of rights of Trustee and
securityholders not to be hindered or
delayed........................................ 68
ARTICLE ELEVEN
Supplemental Indentures
Section 11.01 Purposes for which supplemental indentures
may be entered into without consent of
securityholders............................... 68
Section 11.02 Modification of Indenture with consent of
holders of a majority in principal amount
of Securities of a Series..................... 69
Section 11.03 Effect of supplemental indentures............... 71
Section 11.04 Securities may bear notation of changes by
supplemental indentures....................... 71
Section 11.05 Opinion of Counsel.............................. 71
Section 11.06 Conformity with Trust Indenture Act............. 71
</TABLE>
-vii-
<PAGE> 9
<TABLE>
<CAPTION>
Page
------
<S> <C> <C>
ARTICLE TWELVE
Consolidation, Merger and Sale
Section 12.01 Company may consolidate, etc., only on
certain terms.................................. 72
Section 12.02 Successor corporation to be substituted.......... 73
Section 12.03 Opinion of Counsel............................... 74
ARTICLE THIRTEEN
Satisfaction and Discharge of Indenture;
Unclaimed Moneys
Section 13.01 Satisfaction and discharge of Indenture.......... 74
Section 13.02 Application by Trustee of funds deposited
for payment of Securities...................... 75
Section 13.03 Repayment of moneys held by paying agent......... 75
Section 13.04 Repayment of moneys held by Trustee.............. 75
ARTICLE FOURTEEN
Immunity of Incorporators, Shareholders,
Officers, Directors and Employees
Section 14.01 Incorporators, shareholders, officers,
directors and employees of Company exempt
from individual liability...................... 76
ARTICLE FIFTEEN
Miscellaneous Provisions
Section 15.01 Successors and assigns of Company bound by
Indenture...................................... 76
Section 15.02 Acts of Board, committee or officers of
successor corporation valid.................... 77
Section 15.03 Required notices or demands may be served by
mail; waiver................................... 77
</TABLE>
-viii-
<PAGE> 10
<TABLE>
<CAPTION>
Page
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<S> <C> <C>
Section 15.04 Indenture and Securities to be construed in
accordance with the laws of the State of
Colorado....................................... 77
Section 15.05 Evidence of compliance with conditions
precedent...................................... 78
Section 15.06 Payments due on Saturdays, Sundays or
holidays....................................... 79
Section 15.07 Provisions required by Trust Indenture Act
of 1939, as amended, to control................ 79
Section 15.08 Provisions of the Indenture and Securities
for the sole benefit of the parties and
the securityholders............................ 79
Section 15.09 Indenture may be executed in counterparts;
acceptance by Trustee.......................... 80
Section 15.10 Article and Section headings..................... 80
Section 15.11 Action by Executive Committee of Board of
Directors...................................... 80
Section 15.12 Separability clause.............................. 80
Section 15.13 Maximum lawful rate.............................. 80
Testimonium.................................... 82
Signatures and seals........................... 82
</TABLE>
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<PAGE> 11
THIS INDENTURE, dated as of the 23th day of March, 1995,
between JONES INTERCABLE, INC., a corporation duly organized and existing
under the laws of the State of Colorado (hereinafter sometimes referred to
as the "Company"), and U.S. TRUST COMPANY OF CALIFORNIA, N.A. a national
banking association duly organized and existing under and by virtue of the
laws of the United States of America (hereinafter sometimes referred to as
the "Trustee").
W I T N E S S E T H :
WHEREAS, the Company has duly authorized the execution and
delivery of this Indenture to provide for the issuance from time to time of
its unsecured debentures, notes or other evidences of indebtedness (the
"Securities"), to be issued in one or more series as in this Indenture
provided; and
WHEREAS, all acts and 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:
That in order to declare the terms and conditions upon which
the Securities are authenticated, issued, delivered and held, and in
consideration of the promises, and of the purchase and acceptance of the
Securities by the holders thereof and of the sum of one dollar to it duly
paid by the Trustee at the execution of these presents, the receipt whereof
is hereby acknowledged, the Company covenants and agrees with the Trustee,
for the equal and proportionate benefit of the respective holders from time
to time of the Securities, as follows:
ARTICLE ONE
Definitions
Section 1.01. Certain Terms Defined. The terms defined in
this Section 1.01 (except as otherwise expressly provided or unless the
context otherwise requires) for all purposes of this Indenture and of any
indenture supplemental hereto shall have the respective meanings specified
in this Section 1.01. All other terms used in this Indenture which are
defined in the Trust Indenture Act of 1939, as amended, or which are by
reference therein defined in the Securities Act of
<PAGE> 12
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1933, as amended (except as herein otherwise expressly provided or unless
the context otherwise requires), shall have the meanings assigned to such
terms in said Trust Indenture Act of 1939, as amended, and in said
Securities Act of 1933, as amended, as they are in force at the date of the
execution of this Indenture.
Affiliated Partnership: The term "Affiliated Partnership"
shall mean any general or limited partnership, joint venture or other
entity of a similar nature of which the Company or any Subsidiary is
general or managing partner or venturer and of which the Company or any
Subsidiary owns or controls at least a 0.5% interest.
Board of Directors: The term "Board of Directors," when used
with reference to the Company, shall mean the Board of Directors of the
Company, or the Executive Committee of the Board of Directors of the
Company, if any.
Board Resolution: The term "Board Resolution" shall mean a
copy of a resolution or resolutions 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: The term "business day" shall mean a day other
than a Saturday, a Sunday or a day which shall be in the City of Los
Angeles, California, a day on which banking institutions are authorized or
obligated by law or regulation to close.
Capital Stock: The term "Capital Stock" shall mean, in respect
of any Person, any and all shares, interests, rights to purchase, warrants,
options, participations or other equivalents of or interests in (however
designated) corporate stock.
Company: The term "Company" shall mean Jones Intercable, Inc.,
a Colorado corporation, and, subject to the provisions of Article Twelve,
shall also include its successors and assigns.
Company Order: The term "Company Order" shall mean a written
order signed in the name of the Company by its Chairman of the Board, its
President or a Vice President, and by its
<PAGE> 13
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Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary,
and delivered to the Trustee.
Convertible Securities: The term "Convertible Securities"
shall mean any publicly issued security or other evidence of indebtedness
which is issued by the Company in a public offering and which is
convertible at any time into shares of Capital Stock of the Company.
Corporate Trust Office: The term "Corporate Trust Office"
shall mean the principal office of the Trustee in Los Angeles, California
or such other or additional offices as may be specified to the Company by
the Trustee in writing at which at any particular time its corporate trust
business shall be administered.
Defaulted Interest: The term "Defaulted Interest" shall have
the meaning specified in Section 2.04.
Event of Default: The term "Event of Default" shall mean any
event specified in Section 7.01, continued for the period of time, if any,
and after the giving of notice, if any, therein designated.
Indenture: The term "Indenture" shall mean this instrument as
originally executed, or as it may from time to time be supplemented or
amended by one or more indentures supplemental hereto entered into pursuant
to the applicable provisions hereof and shall include the form and terms of
particular series of Securities established as contemplated by
Section 2.01.
interest: The term "interest," when used with respect to an
Original Issue Discount Security which by its terms bears interest only
after Maturity, shall mean interest payable after Maturity.
Interest Payment Date: The term "Interest Payment Date," when
used with respect to any Security, shall mean the Stated Maturity of an
instalment of interest on such Security.
Maturity: The term "Maturity," when used with respect to any
Security, shall mean the date on which the principal of such Security or an
instalment of principal becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration of acceleration,
call for redemption or otherwise.
<PAGE> 14
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Officers' Certificate: The term "Officers' Certificate" shall
mean a certificate signed by the Chairman of the Board or the President or
any Vice President and by the Treasurer or an Assistant Treasurer or the
Secretary or an Assistant Secretary of the Company. Each such certificate
shall include the statements provided for in Section 15.05, if and to the
extent required by the provisions thereof.
Opinion of Counsel: The term "Opinion of Counsel" shall mean
an opinion in writing signed by legal counsel, who may be an employee of,
or of counsel to, the Company and who shall be satisfactory to the Trustee.
Each such opinion shall include the statements provided for in Section
15.05, if and to the extent required by the provisions thereof.
Original Issue Discount Security: The term "Original Issue
Discount Security" shall mean any Security which provides for an amount
less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to
Section 7.01.
Person: The term "Person" shall mean any individual,
corporation, partnership, joint venture, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
Place of Payment: The term "Place of Payment," when used with
respect to the Securities of any series, shall mean the place or places
where the principal of (and premium, if any) and interest on the Securities
of that series are payable as specified in accordance with Section 2.01.
Predecessor Security: The term "Predecessor Security" of any
particular Security shall mean every previous Security evidencing all or a
portion of the same debt as that evidenced by such particular Security;
and, for the purposes of this definition, any Security authenticated and
delivered under Section 2.09 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Security shall be deemed to evidence the same
debt as the mutilated, destroyed, lost or stolen Security.
Regular Record Date: The term "Regular Record Date" for the
interest payable on any Interest Payment Date on the Securities of any
series shall mean the date specified for that purpose in accordance with
Section 2.01.
<PAGE> 15
-5-
Reporting Date: The term "Reporting Date" shall mean, when
used with respect to any series of Securities, unless otherwise specified
in a Board Resolution of supplemental indenture establishing a such series,
May 15 of each year.
Responsible Officer: The term "Responsible Officer," when used
with respect to the Trustee, means any officer within the Corporate Trust
Department of the Trustee, including any Vice President, Assistant Vice
President, any trust officer or any other officer performing functions
similar to those performed by the person who at the time shall be such
officers, and any other officer of the Trustee to whom corporate trust
matters are referred because of his knowledge of and familiarity with the
particular subject.
Security or Securities; outstanding: The term "Security" or
"Securities" shall mean any Security or Securities of the same series, as
the case may be, authenticated and delivered under this Indenture.
The term "outstanding," when used with reference to Securities
of a series, shall, subject to the provisions of Section 9.04, mean, as of
any particular time, all Securities of such series authenticated and
delivered by the Trustee under this Indenture, except:
(a) Securities of such series theretofore cancelled by the
Trustee or delivered to the Trustee for cancellation;
(b) Securities of such series, or portions thereof, for the
payment or redemption of which moneys in the necessary amount shall
have been deposited in trust with the Trustee or with any paying
agent (other than the Company) or shall have been set aside and
segregated in trust by the Company (if the Company shall act as its
own paying agent), provided that such Securities shall have reached
their stated maturity, or, if such Securities are to be redeemed
prior to the maturity thereof, notice of such redemption shall have
been given as provided in Article Four, or provision satisfactory to
the Trustee shall have been made for giving such notice; and
(c) Securities in lieu of or in substitution for which other
Securities shall have been authenticated and delivered pursuant to
the terms of Section 2.07, unless
<PAGE> 16
-6-
proof satisfactory to the Trustee is presented that any such
Securities are held by bona fide holders in due course.
Securityholder; holder of Securities; registered holder: The
term "securityholder," "holder of Securities," "registered holder," or
other similar term, shall mean any person who shall at the time be the
registered holder of any Security or Securities on the books of the Company
kept for that purpose in accordance with the provisions of the Indenture
and shall also mean the executors, administrators and other legal
representatives of such person.
Security Register: The term "Security Register" shall have the
meaning specified in Section 2.07.
Significant Subsidiary: The term "Significant Subsidiary"
shall have the meaning ascribed to it in Rule 1-02 of Regulation S-X of the
Securities and Exchange Commission.
Special Record Date: The term "Special Record Date" for the
payment of any Defaulted Interest shall mean a date fixed by the Trustee
pursuant to Section 2.04.
Stated Maturity: The term "Stated Maturity," when used with
respect to any Security or any installment of principal thereof or interest
thereon, shall mean the date specified in such Security as the fixed date
on which the principal of such Security or such instalment of principal or
interest is due and payable.
Subsidiary: The term "Subsidiary" of any specified Person
shall mean a corporation whose Capital Stock with voting power, under
ordinary circumstances, to elect a majority of the directors is at any
time, directly or indirectly, owned by such Person or by such Person and a
Subsidiary or Subsidiaries of such Person or by a Subsidiary or
Subsidiaries of such Person. Unless otherwise qualified, all references to
a "Subsidiary" or "Subsidiaries" herein shall refer to a Subsidiary or
Subsidiaries of the Company.
Trustee; principal corporate trust office: The term "Trustee"
shall mean U.S. Trust Company of California, N.A. and, subject to the
provisions of Article Eight, shall also include its successors. The term
"principal corporate trust office" of the Trustee shall mean the principal
corporate trust
<PAGE> 17
-7-
office of the Trustee, at which at any particular time its corporate trust
business may be administered.
Trust Indenture Act of 1939, as amended: The term "Trust
Indenture Act of 1939, as amended," shall mean the Trust Indenture Act of
1939, as amended, as it is in force at the date of execution of this
Indenture.
Section 1.02. References are to Indenture. Unless the context
otherwise requires, all references herein to "Articles," "Sections" and
other subdivisions refer to the corresponding Articles, Sections and other
subdivisions of this Indenture, and the words "herein," "hereof," "hereby,"
"hereunder" and words of similar import refer to this Indenture as a whole
and not to any particular Article, Section or other subdivision hereof.
Section 1.03. Security Forms. (a) The Securities of each
series shall be in substantially the form established from time to time by
or pursuant to a Board Resolution or in one or more indentures
supplemental hereto, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted
by this Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such
Securities, as evidenced by their execution of such Securities. Any
portion of the text of any Security may be set forth on the reverse
thereof, with an appropriate reference thereto on the face of the Security.
If the form of Securities of any series is established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the
Company Order contemplated by Section 2.03 for the authentication and
delivery of such Securities. Any such Board Resolution or record of such
action shall have attached thereto a true and correct copy of the form of
Security referred to therein approved by or pursuant to such Board
Resolution.
The Trustee's certificate of authentication shall be in
substantially the form set forth in this Article.
The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be
<PAGE> 18
-8-
produced in any other manner, all as determined by the officers executing
such Securities, as evidenced by their execution of such Securities.
(b) The Trustee's certificate of authentication on all
Securities shall be in substantially the following form:
"This is one of the Securities of the series designated therein
issued under the within-mentioned Indenture.
U.S. TRUST COMPANY OF CALIFORNIA, N.A.
as Trustee
By ___________________________
Authorized Signatory"
ARTICLE TWO
The Securities
Section 2.01. Amount Unlimited; Issuable in Series. The
aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There
shall be established in or pursuant to a Board Resolution, and set forth in
an Officers' Certificate, or established in one or more indentures
supplemental hereto, prior to the issuance of Securities of any series,
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from all other Securities);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered
under this Indenture (except for Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in
lieu of, other securities of the series pursuant to Section 2.07,
2.08, 2.09, 4.03 or 11.04);
(3) the date or dates on which the principal (and premium, if
any) of the Securities of the series is payable or the method of
determination thereof;
<PAGE> 19
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(4) the rate or rates (which may be fixed or variable), or
the method of determination thereof, at which the Securities of the
series shall bear interest, if any, including the rate of interest
applicable on overdue payments of principal or interest, if different
from the rate of interest stated in the title of the Security, the
date or dates from which such interest shall accrue or the method of
determination thereof, the Interest Payment Dates on which such
interest shall be payable and the Regular Record Date for the
interest payable on any Interest Payment Date;
(5) the Paying Agent or Paying Agents for the Securities of
the series if other than the Trustee;
(6) the Place of Payment of the Securities of the series if
other than the Corporate Trust Office of the Trustee;
(7) if applicable, the period or periods within which, the
price or prices at which and the terms and conditions upon which
Securities of the series may be redeemed, in whole or in part, at the
option of the Company;
(8) the obligation, if any, of the Company to redeem or
purchase Securities of the series pursuant to any sinking fund or
analogous provisions or at the option of a Holder thereof and the
period or periods within which, the price or prices at which and the
terms and conditions upon which Securities of the series shall be
redeemed or purchased, in whole or in part, pursuant to such
obligation;
(9) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of the series
shall be issuable;
(10) if other than the principal amount thereof, the portion
of the principal amount of Securities of the series which shall be
payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 7.01;
(11) any deletions from or modifications of or additions to
the Events of Default set forth in Section 7.01 pertaining to the
Securities of the series;
<PAGE> 20
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(12) the form of the Securities of the series;
(13) the obligation, if any, of the Company to permit the
conversion of the Securities into Capital Stock and the terms and
conditions upon which such conversion shall be effected (including,
without limitation, the initial conversion rate, the conversion
period, adjustments to the conversion rate and any other provision
relative to such obligation);
(14) any deletions from or modifications of or additions to
the covenants set forth in Article Five per- taining to the
Securities of the series;
(15) any modification of Section 11.02 to provide that certain
other provisions of this Indenture cannot be modified or waived
without the consent of the holder of each Security of the series;
(16) any other terms of a particular series and any other
provisions expressing or referring to the terms and conditions upon
which the Securities of that series are to be issued, which terms and
provisions are not in conflict with the provisions of this Indenture
or do not adversely affect the rights of Holders of any other series
of Securities then outstanding; provided, however, that the addition
to or subtraction from or variation of Articles Five, Seven, Twelve
and Thirteen (and Section 1.01 insofar as it relates to the
definition of certain terms as used in such Articles) with regard to
the Securities of a particular series shall not be deemed to
constitute a conflict with the provisions of those Articles; and
(17) the Reporting Date of the Securities of the series.
All Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided
in or pursuant to such Board Resolution and set forth in such Officers'
Certificate or in any such indenture supplemental hereto.
The Securities of all series shall rank on a parity in right of
payment.
If any of the terms of the series are established by action
taken pursuant to a Board Resolution, a copy of an
<PAGE> 21
-11-
appropriate record of such action shall be certified by the Secretary or an
Assistant Secretary of the Company and delivered to the Trustee at or prior
to the delivery of the Officers' Certificate setting forth the terms of the
series.
Section 2.02. Denominations. The Securities of each series
shall be issuable in registered form without coupons in such denominations
as shall be specified in accordance with Section 2.01. In the absence of
any such provisions with respect to the Securities of any series, the
Securities of such series shall be issuable in denominations of $1,000 and
any integral multiple thereof.
Section 2.03. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman
of the Board, its President or one of its Vice Presidents, under its
corporate seal reproduced thereon attested by its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on the
Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall
bind the Company, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery of
such Securities or did not hold such offices at the date of such
Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any
series executed by the Company to the Trustee for authentication, together
with a Company Order for the authentication and delivery of such
Securities, and the Trustee in accordance with the Company Order shall
authenticate and deliver such Securities. In authenticating such
Securities, and accepting the additional responsibilities under this
Indenture in relation to such Securities, the Trustee shall be entitled to
receive and (subject to Section 8.01) shall be fully protected in relying
upon the documents specified in Section 314 of the Trust Indenture Act,
and, in addition:
(a) a Board Resolution relating thereto, and if applicable,
an appropriate record of any action taken pursuant to such Board
Resolution, certified by the Secretary or Assistant Secretary of the
Company;
(b) an executed supplemental indenture, if any; and
<PAGE> 22
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(c) an Opinion of Counsel which shall state
(1) that the form and terms of such Securities have
been established by or pursuant to Board Resolutions, by a
supplemental indenture or by both such resolution or
resolutions and such supplemental indenture in conformity with
the provisions of this Indenture;
(2) that the supplemental indenture, if any, when
executed and delivered by the Company and the Trustee, will
constitute a valid and legally binding obligation of the
Company, enforceable in accordance with its terms, subject to
bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting the enforcement
of creditors' rights and to general equity principles; and
(3) that such Securities, when authenticated and
delivered by the Trustee and issued by the Company in the
manner and subject to any conditions specified in such Opinion
of Counsel, will constitute valid and legally binding
obligations of the Company, enforceable in accordance with
their terms, subject to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or
affecting the enforcement of creditors' rights and to general
equity principles, and will be entitled to the benefits of this
Indenture.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on
such Security a certificate of authentication substantially in the form
provided for herein executed by the Trustee by manual signature, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
Section 2.04. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment
<PAGE> 23
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Date shall be paid to the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest.
At the option of the Company, interest on the Securities of any
series that bear interest may be paid by mailing a check to the address of
the Person entitled thereto as such address shall appear in the Security
Register.
Any interest on any Security of any series which is payable,
but is not punctually paid or duly provided for, on any Interest Payment
Date ("Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date by virtue of having been such
Holder, and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such series
(or their respective Predecessor Securities) are registered at the
close of business on a Special Record Date for the payment of such
Defaulted Interest, which shall be fixed in the following manner.
The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Security of such
series and the date of the proposed payment, and at the same time the
Company shall deposit with the Trustee an amount of money equal to
the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for
such deposit prior to the date of the proposed payment, such money
when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this Clause provided.
Thereupon the Trustee shall fix a Special Record Date for the payment
of such Defaulted Interest which shall be not more than 15 days and
not less than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of the notice
of the proposed payment. The Trustee shall promptly notify the
Company of such Special Record Date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor to be
mailed, first-class postage prepaid, to each Holder of Securities of
such series at his address as it appears in the Security Register,
not less than 10 days prior to such Special Record Date. Notice of
the
<PAGE> 24
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proposed payment of such Defaulted Interest and the Special Record
Date therefor having been so mailed, such Defaulted Interest shall be
paid to the Persons in whose names the Securities of such series (or
their respective Predecessor Securities) are registered at the close
of business on such Special Record Date and shall no longer be
payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on
the Securities of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange on
which such Securities may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company to
the Trustee of the proposed payment pursuant to this Clause, such
manner of payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or
in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such
other security.
Section 2.05. Persons Deemed Owners. Prior to due presentment
of a Security for registration or transfer, 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 (and premium, if any) and (subject to
Section 2.04) interest on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and none of the
Company, the Trustee or any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Section 2.06. Computation of Interest. Except as otherwise
specified in accordance with Section 2.01 for Securities of any series,
interest on the Securities of each series shall be computed on the basis of
a year of twelve 30-day months.
Section 2.07. Exchange of Securities. Securities may be
exchanged for a like aggregate principal amount of Securities of the same
series of other authorized denominations. The Securities to be exchanged
shall be surrendered at the office or agency to be maintained by the
<PAGE> 25
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Company in accordance with the provisions of Section 5.02, and the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor the Security or Securities which the securityholder making the
exchange shall be entitled to receive.
The Company shall keep, at the office or agency to be
maintained by the Company in accordance with the provisions of
Section 5.02, a register or registers (such register or registers being
herein sometimes referred to as the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall
register Securities and shall register the transfer of Securities as in
this Article Two provided. Upon surrender for registration of transfer of
any Security at such office or agency, the Company shall execute and the
Trustee shall authenticate and deliver in the name of the transferee or
transferees a new Security or Securities of the same series for a like
aggregate principal amount. The Trustee shall have the right to examine
the register at any time.
All Securities presented or surrendered for exchange,
registration or transfer, redemption or payment shall, if so required by
the Company or the Trustee, be accompanied by a written instrument or
instruments of transfer, in form satisfactory to the Company or the
Trustee, duly executed by the registered holder or by his duly authorized
attorney.
No service charge shall be made for any exchange or
registration of transfer of Securities, but the Company may require payment
of a sum sufficient to cover any tax or other governmental charge that may
be imposed in relation thereto.
The Company shall not be required to issue, register the
transfer of or exchange any Securities for a period of fifteen days next
preceding any date for the selection of Securities of the same series to be
redeemed. The Company shall not be required to register the transfer of,
or exchange any Security called or being called for redemption.
Section 2.08. Temporary Securities. Pending the preparation
of definitive Securities, the Company may execute and the Trustee shall
authenticate and deliver temporary Securities (printed, lithographed or
typewritten) of any authorized denomination and substantially in the form
of the definitive Securities, but with or without a recital of specific
redemption prices and with such omissions, insertions
<PAGE> 26
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and variations as may be appropriate for temporary Securities, all as may
be determined by the Board of Directors of the Company. Temporary
Securities shall contain such reference to any provisions of the Indenture
as may be appropriate. Every such temporary Security shall be
authenticated by the Trustee upon the same conditions and in substantially
the same manner, and with the same effect, as the definitive Securities.
Without unnecessary delay, the Company will execute and deliver to the
Trustee definitive Securities and thereupon any or all temporary Securities
may be surrendered in exchange therefor, at the office or agency to be
maintained by the Company in accordance with the provisions of Section
5.02, and the Trustee shall authenticate and deliver in exchange for such
temporary Securities an equal aggregate principal amount of definitive
Securities of the same series. Until so exchanged, the temporary
Securities shall in all respects be entitled to the same benefits under
this Indenture as definitive Securities of the same series authenticated
and delivered hereunder.
Section 2.09. Mutilated, destroyed, lost or stolen Securities.
In case any temporary or definitive Securities shall become mutilated or be
destroyed, lost or stolen, the Company, in the case of any mutilated
Security shall, and in the case of any destroyed, lost or stolen Security
in its discretion may, execute, and upon its request the Trustee shall
authenticate and deliver, a new Security of the same series bearing a
number not contemporaneously outstanding in exchange and in substitution
for the mutilated Security, or in lieu of and in substitution for the
Security so destroyed, lost or stolen, or, if any such Security shall have
matured or shall be about to mature, instead of issuing a substituted
Security, the Company may pay the same without surrender thereof except in
the case of mutilated Security. In every case the applicant for a
substituted Security or for such payment shall furnish to the Company and
to the Trustee such security or indemnity as may be required by them to
save each of them harmless, and, in every case of destruction, loss or
theft, the applicant shall also furnish to the Company and to the Trustee
evidence to their satisfaction of the destruction, loss or theft of such
Security and of the ownership thereof. The Trustee may authenticate any
substituted Security and deliver the same, or the Trustee or any paying
agent of the Company may make any such payment, upon the written request or
authorization of any officer of the Company, and shall incur no liability
to anyone by reason of anything done or omitted to be done by it in good
faith under the provisions of this Section 2.09. Upon the issue of any
such substituted Security, the Company may require
<PAGE> 27
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the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses
connected therewith.
Every substituted Security issued pursuant to the provisions of
this Section 2.09 in substitution for any destroyed, lost or stolen
Security shall constitute an additional contractual obligation of the
Company, whether or not the destroyed, lost or stolen Security shall be
found at any time, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Securities
duly issued hereunder.
All Securities shall be held and owned upon the express
condition that the foregoing provisions are exclusive with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Securities,
and shall preclude (to the extent lawful) any and all other rights or
remedies, notwithstanding any law or statute existing or hereafter enacted
to the contrary with respect to the replacement or payment of negotiable
instruments or other securities without their surrender.
Section 2.10. Cancellation of surrendered Securities. All
Securities surrendered upon or for the purpose of payment, redemption,
exchange, substitution or registration of transfer, or in discharge in
whole or in part of any sinking fund payment or analogous obligation,
shall, if surrendered to the Company or any paying agent or registrar, be
delivered to the Trustee and the same, together with Securities surrendered
to the Trustee, shall be cancelled by it, and no Securities shall be issued
in lieu thereof except as expressly permitted by any of the provisions of
this Indenture. The Trustee shall destroy cancelled Securities as may be
permitted by law and deliver a certificate of destruction thereof to the
Company. Unless otherwise provided in the Supplemental Indenture pursuant
to which any series of Securities is issued, Securities surrendered to the
Trustee for cancellation and cancelled by the Trustee may be used by the
Company, at its election, to reduce the amount of subsequent sinking fund
payments or analogous obligations pursuant to Section 4.04, unless such
Securities have theretofore been made the basis for the reduction of a
Sinking Fund payment. If the Company shall purchase or otherwise acquire
any of the Securities, however, such purchase or acquisition shall not
operate as a payment, redemption or satisfaction of the indebtedness
represented by such Securities, and may not be used as a reduction of a
<PAGE> 28
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sinking fund payment, unless and until the Company, at its option, shall
deliver or surrender the same to the Trustee for cancellation.
ARTICLE THREE
INTENTIONALLY OMITTED
ARTICLE FOUR
Redemption of Securities -- Sinking Fund
Section 4.01. Applicability of Article. Securities of any
series which are redeemable before their Stated Maturity shall be
redeemable in accordance with their terms and (except as otherwise
specified in accordance with Section 2.01 for Securities of any series) in
accordance with this Article.
Section 4.02. Notice of redemption; selection of Securities.
In case the Company shall desire to exercise a right to redeem all or, as
the case may be, any part of the Securities of any series in accordance
with the right reserved so to do, the Company (or the Trustee at the
request of the Company and at the Company's expense) shall give notice of
such redemption to holders of the Securities of the series to be redeemed
as hereinafter provided in this Section 4.02.
Notice of redemption shall be given to the holders of
Securities of the series to be redeemed as a whole or in part by mailing by
first-class mail a notice of such redemption not less than 30 days nor more
than 60 days prior to the date fixed for redemption to their last addresses
as they shall appear upon the registry books, but failure to give such
notice by mailing to the holder of any Security designated for redemption
as a whole or in part, or any defect therein, shall not affect the validity
of the proceedings for the redemption of any other Securities.
Any notice which is mailed in the manner herein provided shall
be conclusively presumed to have been duly given, whether or not the holder
receives the notice.
Each such notice of redemption shall specify the total
principal amount to be redeemed, the date fixed for redemption and the
redemption price at which the Securities are
<PAGE> 29
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to be redeemed, and shall state that payment of the redemption price of the
Securities to be redeemed will be made at the office or agency to be
maintained by the Company or the Trustee in accordance with the provisions
of Section 5.02 (and shall state the name and address of such office or
agency if different from the Company or the Trustee as set forth in Section
5.02), upon presentation and surrender of such Securities, that interest
accrued to the date fixed for redemption will be paid as specified in said
notice, and that on and after said date interest thereon will cease to
accrue. If less than all the Securities of a series are to be redeemed,
the notice of redemption to each holder shall identify the Securities to be
redeemed. In case any Security is to be redeemed in part only, the notice
which relates to such Security shall state the portion of the principal
amount thereof to be redeemed (which shall be $1,000 or an integral
multiple thereof) and shall state that on and after the redemption date,
upon surrender of such Security, the holder will receive the redemption
price together with accrued interest in respect of the principal amount
thereof called for redemption and, without charge, a new Security or
Securities of the same series of authorized denominations for the principal
amount thereof remaining unredeemed.
Prior to the redemption date specified in the notice of
redemption given as provided in this Section 4.02, the Company will deposit
with the Trustee or with one or more paying agents an amount of money
sufficient to redeem on the redemption date all the Securities or portions
of Securities of the series so called for redemption at the appropriate
redemption price, together with accrued interest to the date fixed for
redemption.
If less than all the Securities of a series are to be redeemed,
the Company shall give the Trustee, at least 60 days (or such shorter
period acceptable to the Trustee) in advance of the date fixed for
redemption, notice of the aggregate principal amount of Securities to be
redeemed, and thereupon the Trustee shall select pro rata or by lot the
Securities or portions of Securities thereof of the series to be redeemed
and shall thereafter promptly notify the Company in writing of the numbers
of the Securities or portions thereof to be redeemed.
Section 4.03. When Securities called for redemption become due
and payable. If the giving of notice of redemption shall have been
completed as above provided, the Securities or portions of Securities
specified in such notice shall become
<PAGE> 30
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due and payable on the date and at the place stated in such notice at the
applicable redemption price, together with interest accrued to the date
fixed for redemption, and on and after such date fixed for redemption
(unless the Company shall default in the payment of such Securities at the
redemption price, together with interest accrued to the date fixed for
redemption) interest on the Securities or portions of Securities so called
for redemption shall cease to accrue. On presentation and surrender of
such Securities at the place of payment in said notice specified, the said
Securities shall be paid and redeemed by the Company at the applicable
redemption price, together with interest accrued to the date fixed for
redemption. If the date fixed for redemption is an Interest Payment Date,
such payment shall not include accrued interest, which interest shall be
paid in the usual manner otherwise provided for herein. Upon presentation
of any Security which is redeemed in part only, the Company shall execute
and register and the Trustee shall authenticate and deliver at the expense
of the Company, a new Security or Securities of the same series in
principal amount equal to the unredeemed portion of the Security so
presented.
Section 4.04. Sinking Fund. Except as otherwise specified in
accordance with Section 2.01 for Securities of a series, at its option the
Company may reduce its obligation to make any sinking fund payment in
respect of Securities of a particular series in cash by an amount not
exceeding the sum of the following:
(i) the principal amount of Securities of the same series
theretofore issued and reacquired (otherwise than through redemption
pursuant to this Article Four) by the Company and delivered to the
Trustee for cancellation and not theretofore made the basis for the
reduction of a sinking fund payment; and
(ii) the principal amount of Securities of the same series
redeemed and paid pursuant to the provisions of this Article Four
(otherwise than through the operation of the sinking fund) and
delivered to the Trustee for cancellation, or which shall have been
duly called for redemption (otherwise than through the operation of
the sinking fund) and the redemption price of which shall have been
deposited in trust for that purpose, and which have not theretofore
been made the basis for the reduction of a sinking fund payment.
<PAGE> 31
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Section 4.05. Redemption of Securities for Sinking Fund. Not
less than 60 days prior to each sinking fund payment date for any series of
Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment
for that series pursuant to the terms of that series, the portion thereof,
if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and crediting
Securities of that series pursuant to Section 4.04 and will also deliver to
the Trustee any Securities to be so delivered. Not less than 30 days
before each such sinking fund payment date the Trustee shall select the
Securities to be redeemed upon such sinking fund payment date in the manner
specified in Section 4.02 and cause notice of the redemption thereof to be
given in the name of and at the expense of the Company in the manner
provided in Section 4.02. Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the
manner stated in Sections 4.06 and 4.07.
Section 4.06. Redemption in Event of Default. The Trustee
shall not redeem any Securities of a particular series with sinking fund
moneys or mail any notice of redemption of Securities of such series by
operation of the sinking fund during any period in which the Trustee is
charged with knowledge of the continuance of either a default in payment of
interest on the Securities of such series or of any Event of Default (other
than an Event of Default occurring as a consequence of this paragraph),
except that if the notice of redemption of any Securities shall theretofore
have been mailed in accordance with the provisions hereof, the Trustee
shall redeem such Securities if cash sufficient for that purpose shall be
paid to the Trustee for that purpose in accordance with the terms of this
Article Four. Except as aforesaid, any moneys in the sinking fund during
any period in which the Trustee is charged with knowledge of the
continuance of any such default or Event of Default shall, during such
period, be held as security for the payment of all Securities of the same
series; provided, however, that in case such Event of Default or default
shall have been cured or waived as provided herein, such moneys shall
thereafter be applied on the next sinking fund payment date on which such
money may be applied pursuant to the provisions of this Section 4.06.
Subject to Section 7.07, the Trustee shall not be charged with
knowledge of the continuance either of default in payment of interest on
the Securities or of any Event of Default unless either (a) a Responsible
Officer of the Trustee
<PAGE> 32
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assigned to its corporate trust services department shall, as such officer,
have actual knowledge thereof or (b) written notice of such continuance
shall have been given to the Trustee by the Company or by the holders of at
least 5% in principal amount of the Securities of the series in question at
the time outstanding.
Section 4.07. Manner of redeeming Securities. The Securities
to be redeemed from time to time as in Section 4.05 provided shall be
selected by the Trustee for redemption in the manner provided in Section
4.02 and notice thereof shall be given by the Trustee to the Company, and
the Company hereby authorizes the Trustee, in the name of and at the
expense of the Company, to give notice on behalf of the Company of the call
of such Securities, all in the manner and with the effect in this Article
Four specified except that, in addition to the matters required to be
included in such notice by Section 4.02, such notice shall also state that
the Securities therein designated for redemption are to be redeemed through
operation of a sinking fund. Subject to the provisions of Section 4.06 and
to the receipt by the Trustee of the cash and the accrued interest to be
paid to the Trustee pursuant to Sections 4.04 and 4.05, the Trustee shall
cause such Securities to be so redeemed and paid in accordance with such
notice in the manner and with the effect provided in Sections 4.02 and
4.03.
Section 4.08. Cancellation of redeemed Securities. All
Securities surrendered to the Trustee, pursuant to the provisions of this
Article Four, shall be forthwith cancelled by it and shall be destroyed by
the Trustee, as may be permitted by law, which shall deliver its
certificate of destruction thereof to the Company.
ARTICLE FIVE
Particular Covenants of the Company
The Company covenants as follows:
Section 5.01. Payment of principal of and interest on
Securities. The Company will duly and punctually pay or cause to be paid
the principal of and interest on each of the Securities at the time and
place and in the manner provided in the Security and this Indenture. If at
any time Securities of any series are listed on the New York or American
Stock Exchange and checks for payment of principal and interest are
<PAGE> 33
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drawn on a bank located outside of the City of New York, New York,
additional arrangements shall be made for payment on such checks at a bank,
trust company or agency located in the City of New York, New York; these
additional arrangements shall be disclosed to the securityholder upon
payment by such check.
Section 5.02. Maintenance of office or agency for registration
of transfer, exchange and payment of Securities. So long as any of the
Securities shall remain outstanding, the Company will maintain an office or
agency either in the City of Englewood, Colorado, or in the City of Los
Angeles, California, or if at any time Securities of any series are listed
on the New York or American Stock Exchange in the City of New York, New
York, where the Securities may be surrendered for exchange or registration
of transfer as in this Indenture provided, and where notices and demands to
or upon the Company in respect of the Securities or of this Indenture may
be served, and where the Securities may be presented or surrendered for
payment or, for Securities of each series that is convertible, for
conversion. The Company hereby initially appoints the principal corporate
trust office of the Trustee in the City of Los Angeles, California its
office or agency for each of said purposes. The Company will give to the
Trustee notice of the location of any such office or agency and of any
change of location thereof. In case the Company shall fail to maintain any
such office or agency or shall fail to give such notice of the location
thereof or of any change in the location thereof, such surrenders,
presentations and demands may be made and notices may be served at the
principal corporate trust office of the Trustee in the City of Los Angeles,
California, and the Company hereby appoints the Trustee its agent to
receive at the aforesaid offices all such surrenders, presentations,
notices and demands.
Section 5.03. Appointment to fill a vacancy in the office of
Trustee. The Company, whenever necessary to avoid or fill a vacancy in the
office of Trustee, will appoint, in the manner provided in Section 8.10, a
Trustee, so that there shall at all times be a Trustee hereunder.
Section 5.04. Provision as to paying agent.
(a) If the Company shall appoint a paying agent other than
the Trustee, it will cause such paying agent to execute and deliver to the
Trustee an instrument in which such agent shall agree with the Trustee,
subject to the provisions of this Section 5.04,
<PAGE> 34
-24-
(1) that it will hold all sums held by it as such agent for
payment of the principal of or interest on the Securities (whether
such sums have been paid to it by the Company or by any other obligor
on the Securities) in trust for the benefit of the securityholders or
the Trustee, and
(2) that it will give the Trustee notice of any failure by
the Company (or by any other obligor on the Securities) to make any
payment of the principal of or interest on the Securities when the
same shall be due and payable.
(b) 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 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 holders of Securities entitled to such principal or
interest, and (unless such paying agent is the Trustee) the Company will
promptly notify the Trustee of its failure so to act.
(c) If the Company shall act as its own paying agent, it
will, on or before each due date of the principal of or interest on the
Securities, set aside, segregate and hold in trust for the benefit of the
persons entitled thereto, a sum sufficient to pay such principal or
interest so becoming due and will notify the Trustee of any failure to take
such action.
(d) Anything in this Section 5.04 to the contrary
notwithstanding, the Company may, at any time, for the purpose of obtaining
a satisfaction and discharge of this Indenture pursuant to Article Thirteen
hereof, or for any other reason, pay or cause to be paid to the Trustee all
sums held in trust by it, or any paying agent hereunder, as required by
this Section 5.04, such sums to be held by the Trustee upon the trusts
herein contained.
(e) Anything in this Section 5.04 to the contrary
notwithstanding, the agreement to hold sums in trust as provided in this
Section 5.04 is subject to the provisions of Sections 13.03 and 13.04.
Section 5.05. Officers' Certificates as to default. The
Company will, so long as any of the Securities are outstanding:
<PAGE> 35
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(a) deliver to the Trustee, forthwith upon becoming aware of
any default or defaults in the performance of any covenant, agreement
or condition contained in this Indenture, an Officers' Certificate
specifying such default or defaults, and
(b) deliver to the Trustee within 90 days after the end of
each fiscal year of the Company, beginning with the fiscal year
ending May 31, 1996, an Officers' Certificate stating, as to each
signer thereof, that:
(1) a review of the activities of the Company during
such year and of performance under this Indenture has been made
under his supervision, and
(2) to the best of his knowledge, based on such review,
the Company has fulfilled all its obligations under this
Indenture throughout such year, or, if there has been a default
in the fulfillment of any such obligation, specifying each such
default known to him and the nature and status thereof.
ARTICLE SIX
Securityholders' lists and reports
by the Company and the Trustee
Section 6.01. Company to furnish Trustee information as to
names and addresses of Securityholders. The Company will furnish or cause
to be furnished to the Trustee:
(a) semi-annually, either (i) not later than May 15 and
November 15 in each year in the case of Original Issue Discount
Securities of any series which by their terms do not bear interest
prior to Maturity, or (ii) not more than 15 days after each Regular
Record Date in the case of Securities of any other series, a list,
each in such form as the Trustee may reasonably require, of the names
and addresses of the Holders of Securities of such series as of the
preceding May 1 or November 1 or as of such Regular Record Date, as
the case may be, and
(b) at such other times as the Trustee may request in
writing, within 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 15 days prior to the
<PAGE> 36
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time such list is furnished, provided, however, that so long as the
Trustee is the Security registrar in respect of a series, no such
list shall be required to be furnished as to such series.
Section 6.02. Preservation and disclosure of lists.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses of
the holders of Securities of a series (1) contained in the most recent list
furnished to it as provided in Section 6.01 and (2) received by it in the
capacity of paying agent (if so acting) and Security registrar. The
Trustee may destroy any list furnished to it as provided in Section 6.01
upon receipt of a new list so furnished.
(b) In case three or more holders of Securities of such
series (hereinafter 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 of such series for a period of at least six
months preceding the date of such application, and such application states
that the applicants desire to communicate with other holders of Securities
of such series with respect to their rights under this Indenture or under
the Securities of such series, and is accompanied by a copy of the form of
proxy or other communication which such applicants proposed to transmit,
then the Trustee shall, within five business days after the receipt of such
application, notify the Company of such application and its election either
(1) afford such applicants access to the information
preserved at the time by the Trustee in accordance with the
provisions of subsection (a) of this Section 6.02, or
(2) inform such applicants as to the approximate number of
holders of Securities of such series whose names and addresses appear
in the information preserved at the time by the Trustee in accordance
with the provisions of subsection (a) of this Section 6.02, and as to
the approximate cost of mailing to such securityholders the form of
proxy or other communication, if any, specified in such application.
If the Trustee shall elect not to afford such applicants access to
such information, the Trustee shall, upon the written request of such
applicants, mail to each securityholder whose name and address
appears in the information preserved at the time
<PAGE> 37
-27-
by the Trustee in accordance with the provisions of subsection (a) of
this Section 6.02, a copy of the form of proxy or other communication
which is specified in such request, with reasonable promptness after
a tender to the Trustee of the material to be mailed and of payment,
or provision for the payment, of the reasonable expenses of mailing,
unless within five days after such tender, the Trustee shall mail to
such applicants, with a copy to the Company, and file with the
Securities and Exchange Commission, together with a copy of the
material to be mailed, a written statement to the effect that in the
opinion of the Trustee, such mailing would be contrary to the best
interests of the holders of Securities or would be in violation of
applicable law. Such written statement shall specify the basis of
such opinion. If said 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, said 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 securityholders 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) Each and every holder of the Securities, by receiving and
holding the same, agrees with the Company and the Trustee that neither the
Company nor the Trustee nor any paying agent nor the Security registrar
shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the holders of Securities in
accordance with the provisions of subsection (b) of this Section 6.02,
regardless of the source from which such information was derived, and that
the Trustee shall not be held accountable by reason of mailing any material
pursuant to a request made under said subsection (b).
Section 6.03. Reports by the Company.
(a) The Company covenants and agrees to file with the
Trustee, within 15 days after the Company is required to file the same with
the Securities and Exchange Commission, copies of the annual reports and of
the information, documents
<PAGE> 38
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and other reports (or copies of such portions of any of the foregoing as
said Commission may from time to time by rules and regulations prescribe)
which the Company may be required to file with said Commission pursuant to
Sections 13, 14 or Section 15(d) of the Securities Exchange Act of 1934, as
amended; or, if the Company is not required to file information, documents
or reports pursuant to any of such sections, then to file with the Trustee
and said Commission, in accordance with rules and regulations prescribed
from time to time by said Commission, such of the supplementary and
periodic information, documents and reports which may be required to be
filed pursuant to Section 13 of the Securities Exchange Act of 1934, as
amended, in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in such rules
and regulations.
(b) The Company covenants and agrees to file with the Trustee
and the Securities and Exchange Commission, in accordance with the rules
and regulations prescribed from time to time by said Commission, such
additional information, documents and reports with respect to compliance by
the Company with the conditions and covenants provided for in this
Indenture as may be required from time to time by such rules and
regulations.
(c) The Company covenants and agrees to transmit to the
holders of Securities within 30 days after the filing thereof with the
Trustee, in the manner and to the extent provided in subsection (c) of
Section 6.04 with respect to reports pursuant to subsection (a) of said
Section 6.04, such summaries of any information, documents and reports
required to be filed by the Company pursuant to subsections (a) and (b) of
this Section 6.03 as may be required by rules and regulations prescribed
from time to time by the Securities and Exchange Commission.
(d) The Company covenants and agrees to transmit to the
Trustee written notice of any Event of Default, as defined in Section 7.01
hereof, within 15 days of its occurrence.
Section 6.04. Reports by the Trustee.
(a) Within 60 days after the first Reporting Date occurring
subsequent to the initial issuance of Securities hereunder and within 60
days after each Reporting Date occurring thereafter, the Trustee shall
transmit by mail to the Holders, as hereinabove provided, a brief report
(but in no
<PAGE> 39
-29-
event shall such report be transmitted more than twelve months after the
date of the initial issuance of the Securities in the case of the first
such report and at stated intervals of more than twelve months in the case
of each subsequent report) dated as of such Reporting Date with respect to
any of the events the Trustee is required to include in such report
pursuant to Section 313(a) of the Trust Indenture Act of 1939, as amended.
(b) The Trustee shall transmit to the security holders, as
hereinafter provided, a brief report with respect to the character and
amount of any advances (and if the Trustee elects so to state, the
circumstances surrounding the making thereof) made by the Trustee (as such)
since the date of the last report transmitted pursuant to the provisions of
subsection (a) of this Section 6.04 (or if no such report has yet been so
transmitted, since the date of execution of this Indenture), for the
reimbursement of which it claims or may claim a lien or charge prior to
that of the Securities on property or funds held or collected by it as
Trustee, and which it has not previously reported pursuant to this
subsection, except that the Trustee shall not be required (but may elect)
to report such advances if such advances remaining unpaid at any time
aggregate ten per cent or less of the principal amount of Securities
outstanding at such time, such report to be transmitted within 90 days
after such time.
(c) Reports pursuant to this Section 6.04 shall be
transmitted by mail (1) to all holders of Securities, as the names and
addresses of such holders appear upon the registration books of the
Company; (2) to such holders of Securities as have, within the two years
preceding such transmission, filed their names and addresses with the
Trustee for that purpose; and (3) except in the case of reports pursuant to
Section 6.04(b), to all holders of Securities whose names and addresses
have been furnished to or received by the Trustee pursuant to Section 6.01.
(d) A copy of each such report shall, at the time of such
transmission to securityholders, be filed by the Trustee with each stock
exchange upon which the Securities are listed and also with the Securities
and Exchange Commission. The Company will notify the Trustee when and as
the Securities become listed on any stock exchange.
<PAGE> 40
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ARTICLE SEVEN
Remedies of the Trustee and Securityholders
On Event of Default
Section 7.01. Events of Default defined. "Event of Default,"
wherever used herein with respect to Securities of any series, means any
one of the following events (whatever the reason for such Event of Default
and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court
or any order, rule or regulation of any administrative or governmental
body):
(a) default in the payment of any installment of interest
upon any of the Securities of that series as and when the same shall
become due and payable, and continuance of such default for a period
of 30 days; or
(b) default in the payment of the principal or premium (if
any) of any of the Securities of that series as and when the same
shall become due and payable either at maturity, or upon redemption,
by declaration or otherwise; or
(c) failure on the part of the Company duly to observe or
perform any other of the covenants or agreements on the part of the
Company contained in this Indenture or applicable Securities of that
series (other than a covenant or agreement a default in whose
performance or whose breach is elsewhere in this Section specifically
dealt with or which has expressly been included in this Indenture
solely for the benefit of series of Securities other than that
series) for a period of 60 days after the date on which written
notice of such failure, requiring the same to be remedied, shall have
been given to the Company by the Trustee, or to the Company and the
Trustee by the holders of at least 25% in principal amount of the
Securities of that series at the time outstanding; or
(d) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Company or any corporate
Significant Subsidiary in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee,
<PAGE> 41
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custodian, trustee, sequestrator (or similar official) of the Company
or any corporate Significant Subsidiary or for all or substantially
all of its property, or ordering the winding-up or liquidation of its
affairs, and such decree or order shall remain unstayed and in effect
for a period of 60 consecutive days; or
(e) the Company or any corporate Significant Subsidiary shall
commence a voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or shall consent to
the entry of an order for relief in an involuntary case under any
such law, or shall consent to the appointment of or taking possession
by a receiver, liquidator, assignee, trustee, custodian, sequestrator
(or similar official) of the Company or any corporate Significant
Subsidiary or for all or substantially all of its property, or shall
make any general assignment for the benefit of creditors, or shall
fail generally to pay its debts as they become due; or
(f) any other Event of Default provided with respect to
Securities of that series;
then and in each and every such case, unless the principal amount (or, if
the Securities of that series are Original Issue Discount Securities, such
portion of the principal amount as may be specified in the terms of that
series) of all the Securities of that series shall have already become due
and payable, either the Trustee or the holders of not less than 25% in
aggregate principal amount of the Securities of that series then
outstanding hereunder, by notice in writing to the Company (and to the
Trustee if given by securityholders), may declare the principal amount (or,
if the Securities of that series are Original Issue Discount Securities,
such portion of the principal amount as may be specified in the terms of
that series) of all the Securities of that series to be due and payable
immediately, and upon any such declaration the same shall become and shall
be immediately due and payable, anything in this Indenture or in the
Securities of that series contained to the contrary notwithstanding. This
provision, however, is subject to the condition that if, at any time after
the principal amount (or specified amount) of the Securities of that series
shall have been so declared due and payable, and before any judgment or
decree for the payment of the moneys due shall have been obtained or
entered as hereinafter provided, the Company shall pay or shall deposit
with the Trustee a sum sufficient to pay all matured installments of
interest upon all
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the Securities of that series and the principal of any and all Securities
of that series which shall have become due otherwise than by declaration
(with interest on overdue installments of interest to the extent permitted
by law, and on such principal at the rate of interest borne by the
Securities of that series to the date of such payment or deposit) and the
expenses of the Trustee, and any and all defaults under the Indenture,
other than the nonpayment of principal of and accrued interest on
Securities of that series which shall have become due by declaration, shall
have been remedied -- then and in every such case the holders of a majority
in aggregate principal amount of the Securities of that series then
outstanding, by written notice to the Company and to the Trustee, may waive
all defaults and rescind and annul such declaration and its consequences;
but no such waiver or rescission and annulment shall extend to or shall
affect any subsequent default, or shall impair any right consequent
thereon.
In case the Trustee shall have proceeded to enforce any right
under this Indenture and such proceedings shall have been discontinued or
abandoned because of such rescission or annulment or for any other reason
or shall have been determined adversely to the Trustee, then and in every
such case the Company, the Trustee and the holders of the Securities of
that series shall be restored respectively to their former positions and
rights hereunder, and all rights, remedies and powers of the Company and
the Trustee shall continue as though no such proceedings had been taken.
Section 7.02. Payment of Securities on default; suit therefor.
The Company covenants that (1) in case default shall be made in the payment
of any installment of interest on any of the Securities of a series, as and
when the same shall become due and payable, and such default shall have
continued for a period of 30 days, or (2) in case default shall be made in
the payment of the principal of any of the Securities of a series when the
same shall have become due and payable, whether upon maturity of the
Securities or upon redemption or upon declaration or otherwise -- then,
upon demand of the Trustee, the Company will pay to the Trustee, for the
benefit of the holders of the Securities of that series, the whole amount
that then shall have become due and payable on all such Securities of that
series for principal or interest, or both, as the case may be, with
interest upon the overdue principal and installments of interest (to the
extent permitted by law) at the rate of interest borne by the Securities of
that series; and, in addition thereto, such further amount as shall be
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sufficient to cover the costs and expenses of collection, including a
reasonable compensation to the Trustee, its agents, attorneys and counsel,
and any expenses or liabilities incurred by the Trustee hereunder other
than through its negligence or bad faith.
In case the Company shall fail forthwith to pay such amounts
upon such demand, the Trustee, in its own name and as trustee of an express
trust, shall be entitled and empowered to institute any actions or
proceedings at law or in equity for the collection of the sums so due and
unpaid, and may prosecute any such action or proceeding to judgment or
final decree, and may enforce any such judgment or final decree against the
Company or any other obligor upon the Securities of that series, and
collect in the manner provided by law out of the property of the Company or
any obligor upon the Securities of that series wherever situated the moneys
adjudged or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy
or for the reorganization of the Company or any other obligor upon the
Securities under the federal bankruptcy laws or any other applicable law or
in connection with the insolvency of the Company or any other obligor upon
the Securities or in case a receiver or trustee shall have been appointed
for its property, or in case of any other judicial proceedings relative to
the Company or any other obligor upon the Securities or to the creditors or
property of the Company or such other obligor, 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 pursuant to the provisions
of this Section 7.02, shall be entitled and empowered, by intervention in
such proceedings or otherwise, to file and prove a claim or claims for the
whole amount of principal and interest owing and unpaid in respect of the
Securities except as may be limited by applicable federal bankruptcy laws
or any other applicable law, and to file such other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee
and of the securityholders allowed in any judicial proceeding relative to
the Company or any other obligor upon the Securities, its creditors, or its
property, and to collect and receive any moneys or other property payable
or deliverable on any such claims, and to distribute the same after the
deduction of its charges and expenses; and any receiver, assignee or
trustee in bankruptcy or reorganization is hereby authorized by each of
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the securityholders to make such payments to the Trustee, and, in the event
that the Trustee shall consent to the making of such payments directly to
the securityholders, to pay to the Trustee any amount due it for
compensation and expenses, including counsel fees incurred by it up to the
date of such distribution. To the extent that such payment of reasonable
compensation, expenses, liabilities and counsel fees out of the estate in
any such proceedings shall be denied for any reason, payment of the same
shall be secured by a lien on, and shall be paid out of, any and all
distributions, dividends, moneys, securities and other property which the
holders of the Securities may be entitled to receive in such proceedings,
whether in liquidation or under any plan of reorganization or arrangement
or otherwise.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
securityholders any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of securityholders, or
to authorize the Trustee to vote in respect of the claim of any
securityholders in any such proceeding.
All rights of action and of asserting claims under this
Indenture, or under any of the Securities of a series, may be enforced by
the Trustee without the possession of any of the Securities of such series,
or the production thereof at any trial or other proceeding relative
thereto, and any such suit or proceeding instituted by the Trustee shall be
brought in its own name as trustee of an express trust, and any recovery of
judgment shall be for the ratable benefit of the holders of the Securities
of such series.
Section 7.03. Application of moneys collected by Trustee. Any
moneys collected by the Trustee pursuant to Section 7.02 shall be applied
in the order following, at the date or dates fixed by the Trustee for the
distribution of such moneys, upon presentation of several Securities of a
series, and stamping thereon the payment, if only partially paid, and upon
surrender thereof if fully paid.
First: To the payment of all amounts due the Trustee pursuant
to Section 8.06;
Second: In case no principal of the outstanding Securities of
such series shall have become due and be unpaid, to the payment of interest
on the Securities of such series in
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respect of which or for the benefit of which such money has been collected,
in the order of the maturity of the installments of such interest, with
interest upon the overdue installments of interest (so far as permitted by
law and to the extent that such interest has been collected by the Trustee)
at the rate of interest borne by the Securities of such series, such
payments to be made ratably to the persons entitled thereto, without
discrimination or preference;
Third: In case any principal of the outstanding Securities of
such series shall have become due, by declaration or otherwise, to the
payment of the whole amount then owing and unpaid upon the Securities of
such series in respect of which or for the benefit of which such money has
been collected for principal and interest, with interest on the overdue
principal (and premium, if any) and installments of interest (so far as
permitted by law and to the extent that such interest has been collected by
the Trustee) at the rate of interest borne by the Securities of such
series; and in case such moneys shall be insufficient to pay in full the
whole amount so due and unpaid upon the Securities of such series, then to
the payment of such principal and interest, without preference or priority
of principal over interest, or of interest over principal or of any
installment of interest over any other installment of interest, ratably to
the aggregate of such principal (and premium, if any) and accrued and
unpaid interest; and
Fourth: To the payment of the remainder, if any, to the
Company, its successors or assigns, or to whosoever may be lawfully
entitled to receive the same, or as a court of competent jurisdiction may
direct.
Section 7.04. Limitations on suits by holders of Securities.
No holder of any Security shall have any right by virtue or by availing
itself of any provision of this Indenture to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Indenture or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless such holder previously shall have given to the
Trustee written notice of default and of the continuance thereof, as
hereinabove provided, and unless also the holders of not less than 25% in
aggregate principal amount of the Securities of that series then
outstanding shall have made written request upon the Trustee to institute
such action, suit or proceeding in its own name as Trustee hereunder and
shall have offered to the Trustee such reasonable indemnity as it may
require against the costs, expenses and liabilities to be
<PAGE> 46
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incurred therein or thereby, and the Trustee, for 60 days after its receipt
of such notice, request and offer of indemnity, shall have neglected or
refused to institute any such action, suit or proceeding and no direction
inconsistent with such written request shall have been given to the Trustee
pursuant to Section 7.06; it being understood and intended, and being
expressly covenanted by the taker and holder of every Security with every
other taker and holder and the Trustee, that no one or more holders of
Securities shall have any right in any manner whatever by virtue or by
availing of any provision of this Indenture to affect, disturb or prejudice
the rights of the holders of any other of such Securities of the same
series, or to obtain or seek to obtain priority over or preference to any
other such holder, or to enforce any right under this Indenture, except in
the manner herein provided and for the equal, ratable and common benefit of
all holders of Securities of that series. For the protection and
enforcement of the provisions of this Section 7.04, each and every
securityholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Notwithstanding any other provisions in this Indenture, the
right of any holder of any Security to receive payment of the principal of
and interest on such Security, on or after the respective due dates
expressed in such Security, or to institute suit for the enforcement of any
such payment on or after such respective dates, shall not be impaired or
affected without the consent of such holder.
Section 7.05. Proceedings by Trustee; remedies cumulative and
continuing. In case of a default hereunder the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any of such rights, either by
suit in equity or by action at law or by proceeding in bankruptcy or
otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any
power granted in this Indenture, or to enforce any other legal or equitable
right vested in the Trustee by this Indenture or by law. All powers and
remedies given by this Article Seven to the Trustee or to the
securityholders shall, to the extent permitted by law, be deemed cumulative
and not exclusive of any thereof or of any other powers and remedies
available to the Trustee or the holders of the Securities, by judicial
proceedings or otherwise, to enforce the performance or observance of the
covenants and agreements
<PAGE> 47
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contained in this Indenture, and no delay or omission of the Trustee or of
any holder of any of the Securities to exercise any right or power accruing
upon any default occurring and continuing as aforesaid shall impair any
such right or power, or shall be construed to be a waiver of any such
default or an acquiescence therein; and, subject to the provisions of
Section 7.04, every power and remedy given by this Article Seven or by law
to the Trustee or to the securityholders may be exercised from time to
time, and as often as shall be deemed expedient, by the Trustee or by the
securityholders.
Section 7.06. Rights of holders of majority in principal
amount of Securities to direct Trustee and to waive defaults. The holders
of a majority in aggregate principal amount of Securities of a series at
the time outstanding (determined as provided in Section 9.04), or, if a
record date is set in accordance with Section 9.05, as of such record date,
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; provided, however, that subject to
the provisions of Section 8.01, the Trustee shall have the right to decline
to follow any such direction if the Trustee being advised by counsel shall
determine that the action so directed may not lawfully be taken, or if the
Trustee in good faith shall, by a Responsible Officer or officers of the
Trustee, determine that the proceedings so directed would be illegal or
involve it in personal liability or be unduly prejudicial to the
securityholders not consenting, and provided further that nothing in this
Indenture shall impair the right of the Trustee in its discretion to take
any action deemed proper by the Trustee and which is not inconsistent with
such direction by the securityholders. Prior to the declaration of the
maturity of the Securities of a series as provided in Section 7.01, the
holders of a majority in aggregate principal amount of the Securities of
that series at the time outstanding (determined as provided in Sections
9.04 and 9.05) may on behalf of the holders of all the Securities of that
series waive any past default hereunder and its consequences, except a
default in the payment of interest on, or the principal of, any of the
Securities of that series. In the case of any such waiver the Company, the
Trustee and the holders of the Securities of that series shall be restored
to their former positions and rights hereunder, respectively; but no such
waiver shall extend to any subsequent or other default or impair any right
consequent thereon.
<PAGE> 48
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Section 7.07. Trustee to give notice of defaults known to it,
but may withhold in certain circumstances. The Trustee shall, within 90
days after the occurrence of a default hereunder, give to the
securityholders, in the manner and to the extent provided in subsection (c)
of Section 6.04 with respect to reports pursuant to subsection (a) of
Section 6.04, notice of such defaults known to the Trustee unless such
defaults shall have been cured or waived before the giving of such notice
(the term "defaults" for the purposes of this Section 7.07 being hereby
defined to be the events specified in clauses (a), (b), (c), (d), (e) and
(f) of Section 7.01, not including any periods of grace provided for in
clauses (a) and (c), respectively, and irrespective of the giving of notice
specified in clause (c)); provided that, in the event such notice is given
prior to subsequent cure or waiver of such default, the Trustee shall,
within 30 days after such cure or waiver, give to the securityholders like
notice of such cure or waiver and provided that, except in the case of
default in the payment of the principal of (or premium, if any) or interest
on any of the Securities or any sinking fund payment, the Trustee shall be
protected in withholding such notice if and so long as the board of
directors, the executive committee, or a trust committee of directors
and/or Responsible Officers of the Trustee in good faith determines that
the withholding of such notice is in the interest of the securityholders.
Section 7.08. Requirements of an undertaking to pay costs in
certain suits under the Indenture or against the Trustee. 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 7.08 shall not
apply to any suit instituted by the Trustee, to any suit instituted by any
securityholder of a series, or group of securityholders of a series,
holding in the aggregate more than ten percent in aggregate principal
amount of the Securities of that series outstanding, or to any suit
instituted by any securityholder for the enforcement of the payment of the
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principal of or interest on any Security, on or after the due date
expressed in such Security.
ARTICLE EIGHT
Concerning the Trustee
Section 8.01. Duties and responsibilities of Trustee. The
Trustee, prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically
set forth in this Indenture. In case an Event of Default has occurred
(which has not been cured or waived) the Trustee shall exercise such of the
rights and powers vested in it by this Indenture, and use the same degree
of care and skill in their exercise, as a prudent man would exercise or use
under the circumstances in the conduct of his own affairs.
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, provided, however, that
(a) prior to the occurrence of an Event of Default and after
the curing or waiving of all Events of Default which may have
occurred:
(1) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Indenture,
and the Trustee shall not be liable except for the performance
of such duties and obligations as are specifically set forth in
this Indenture, and no implied covenants or obligations shall
be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture;
but in the case of any such certificates or opinions which by
any provisions hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under
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a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture;
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or officers of the
Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(c) the Trustee shall not be liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of the holders of not less than a
majority in principal amount of the Securities of any series at the
time outstanding (determined as provided in Sections 9.04 And 9.05)
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 of such series.
None of the provisions contained in this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it. Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct of or affecting the liability of or
affording protections to the Trustee shall be subject to the provisions of
this Section 8.01.
Section 8.02. Reliance on documents, opinions, etc. Subject
to the provisions of Section 8.01:
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, approval, bond, security or other paper or document believed
by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) Any request, direction, order or demand of the Company
mentioned herein shall be sufficiently evidenced
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by an Officers' Certificate (unless other evidence in respect thereof
be herein specifically prescribed); and any resolution of the Board
of Directors of the Company may be evidenced to the Trustee by a copy
thereof certified by the Secretary or any Assistant Secretary of the
Company;
(c) The Trustee may consult with counsel of its choosing and
the advice of such counsel or any Opinion of Counsel shall be full
and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(d) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the
request, order or direction of any of the securityholders, pursuant
to the provisions of this Indenture, unless such securityholders
shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which may be incurred
therein or thereby; but nothing herein contained shall, however,
relieve the Trustee of the obligation, upon the occurrence of an
Event of Default (which has not been cured or waived), to exercise
such of the rights and powers vested in it by this Indenture, and to
use the same degree of care and skill in their exercise, as a prudent
man would exercise or use under the circumstances in the conduct of
his own affairs;
(e) The Trustee shall not be liable for any actions taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or right or powers conferred upon
it by this Indenture;
(f) Prior to the occurrence of an Event of Default hereunder
and after the curing or waiving of all Events of Default, the Trustee
shall not be obligated to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, direction, order,
approval, bond, security, or other paper or document, unless
requested in writing to do so by the holders of not less than a
majority in aggregate principal amount of the Securities of a series
then outstanding (determined as provided in Sections 9.04 or 9.05) in
which case the Trustee shall make such inquiry and investigation as
it
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may deem appropriate; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is,
in the opinion of the Trustee, not reasonably assured to the Trustee
by the security afforded to it by the terms of this Indenture, the
Trustee may require reasonable indemnity against such expense or
liability as a condition to so proceeding. The actual, reasonable
out-of-pocket expense of every such examination shall be paid by the
Company or, if paid by the Trustee, shall be repaid by the Company
upon demand. If the Trustee shall determine to make such further
inquiry or investigations, it shall be entitled to examine the books,
records and premises of the Company, personally, or by agent or
attorney; and
(g) The Trustee may exercise any of the rights or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys. 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.
Section 8.03. No responsibility for recitals, etc. The
recitals contained herein and in the Securities (other than the certificate
of authentication on the Securities) shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for the correctness
of the same. The Trustee makes no representation 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 any of the
Securities or of the proceeds of such Securities, or for the use or
application of any moneys paid over by the Trustee in accordance with any
provision of this Indenture, or for the use or application of any moneys
received by any paying agent other than the Trustee.
Section 8.04. Trustee, paying agent or Security registrar may
own Securities. The Trustee or any paying agent or Debenture registrar, in
its individual or any other capacity, may become the owner or pledgee of
Securities and, subject to Section 8.08 and the Trust Indenture Act, as
amended, conduct business with the Company, its Subsidiaries and Affiliated
Partnerships, and other affiliates of the Company, with the same rights it
would have if it were not Trustee, paying agent or Security registrar.
<PAGE> 53
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Section 8.05. Moneys received by Trustee to be held in trust
without interest. Subject to the provisions of Section 13.04, all moneys
received by the Trustee shall, until used or applied as herein provided, be
held in trust for the purposes for which they were received, but 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 moneys received by
it hereunder except such as it may agree in writing with the Company to pay
thereon.
Section 8.06. Compensation and expenses of Trustee. The
Company covenants and agrees to pay to the Trustee from time to time, and
the Trustee shall be entitled to, reasonable and customary compensation
(which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust), and the Company will pay or
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in connection
with the acceptance or administration of its trust under this Indenture
(including the reasonable compensation and the expenses and disbursements
of its counsel and of all persons not regularly in its employ) except any
such expense, disbursement or advance as may arise from its negligence,
wilful misconduct or bad faith. The Company also covenants to indemnify
the Trustee for, and to hold it harmless against, any loss, liability or
expense incurred without negligence, wilful misconduct or bad faith on the
part of the Trustee and arising out of or in connection with (a) the
acceptance or administration of this trust, including liability which the
Trustee may incur as a result of the failure to withhold, pay or report,
any tax, assessment or governmental charge and including the costs and
expenses of defending itself against any claim or liability in connection
with the exercise or performance of any of its powers or duties hereunder,
or (b) any act or omission of any Security registrar or paying agent other
than the Trustee. The obligations of the Company under this Section 8.06
to compensate the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness
hereunder and shall survive the satisfaction and discharge of this
Indenture. Such additional indebtedness shall be secured by a lien prior
to the Securities upon all property and funds held or collected by the
Trustee as such, except funds held in trust for the benefit of the holders
of particular Securities.
Section 8.07. Right of Trustee to rely on Officers'
Certificate where no other evidence specifically prescribed.
<PAGE> 54
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Subject to the provisions of Section 8.01, whenever in the administration
of the provisions of this Indenture the Trustee shall deem it necessary or
desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, such matter (unless other evidence in
respect thereof be herein specifically prescribed) may, in the absence of
negligence, wilful misconduct or bad faith on the part of the Trustee, be
deemed to be conclusively proved and established by an Officers'
Certificate delivered to the Trustee, and such Officers' Certificate, in
the absence of negligence, wilful misconduct or bad faith on the part of
the Trustee, shall be full warrant to the Trustee for any action taken,
suffered or omitted by it under the provisions of this Indenture upon the
faith thereof.
Section 8.08. Conflicting interest of Trustee.
(a) If the Trustee has or shall acquire any conflicting
interest, as defined in this Section 8.08, it shall, within 90 days after
ascertaining that it has such conflicting interest, and if the default to
which such conflicting interest relates has not been cured or duly waived
or otherwise eliminated before the end of such 90-day period, the Trustee
shall either eliminate such conflicting interest or, except as otherwise
provided in subsection (e) of this Section 8.08, resign in the manner and
with the effect specified in Section 8.10, such resignation to become
effective upon the appointment of a successor trustee and such successor's
acceptance of such appointment, and the Company shall take prompt steps to
have a successor appointed in the manner provided in Section 8.10.
(b) In the event that the Trustee shall fail to comply with
the provisions of subsection (a) of this Section 8.08, the Trustee shall,
within ten days after the expiration of such 90-day period, transmit notice
of such failure to the securityholders in the manner and to the extent
provided in subsection (c) of Section 6.04 with respect to reports pursuant
to subsection (a) of Section 6.04.
(c) For the purposes of this Section 8.08 the Trustee shall
be deemed to have a conflicting interest if a default has occurred with
respect to Securities of any series and:
(1) the Trustee is trustee under another indenture under
which any other securities, or certificates of
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interest or participation in any other securities, of the Company are
outstanding, unless such other indenture is a collateral trust
indenture under which the only collateral consists of Securities
issued under this Indenture, provided that there shall be excluded
from the operation of this paragraph any other indenture or
indentures under which other securities, or certificates of interest
or participation in other securities, of the Company are outstanding
if (i) this Indenture and such other indenture or indentures are
wholly unsecured and such other indenture or indentures are qualified
under the Trust Indenture Act of 1939, as amended, unless the
Securities and Exchange Commission shall have found and declared by
order pursuant to Subsection (b) of Section 305 or Subsection (c) of
Section 307 of the Trust Indenture Act of 1939, as amended, that
differences exist between the provisions of this Indenture and the
provisions of such other indenture or indentures which are so likely
to involve a material conflict of interest as to make it necessary in
the public interest or for the protection of investors to disqualify
the Trustee from acting as such under this Indenture and such other
indenture or indentures, or (ii) the Company shall have sustained the
burden of proving, on application to the Securities and Exchange
Commission and after opportunity for hearing thereon, that the
trusteeship under this Indenture and such other indenture is not so
likely to involve a material conflict of interest as to make it
necessary in the public interest or for the protection of investors
to disqualify the Trustee from acting as such under one of such
indentures;
(2) the Trustee or any of its directors or executive officers
is an obligor upon the Securities or an underwriter for the Company;
(3) the Trustee directly or indirectly controls or is
directly or indirectly controlled by or is under direct or indirect
common control with the Company or an underwriter for the Company;
(4) the Trustee or any of its directors or executive officers
is a director, officer, partner, employee, appointee, or
representative of the Company, or of an underwriter (other then the
Trustee itself) for the Company who is currently engaged in the
business of underwriting, except that (A) one individual may be a
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director and/or an executive officer of the Trustee and a director
and/or an executive officer of the Company, but may not be at the
same time an executive officer of both the Trustee and the Company;
(B) if and so long as the number of directors of the Trustee in
office is more than nine, one additional individual may be a director
and/or an executive officer of the Trustee and a director of the
Company; and (C) the Trustee may be designated by the Company or by
an underwriter for the Company to act in the capacity of transfer
agent, escrow agent, registrar, custodian, paying agent, fiscal
agent, escrow agent, or depositary, or in any other similar capacity,
or, subject to the provisions of paragraph (1) of this subsection
(c), to act as trustee whether under an indenture or otherwise;
(5) 10% or more of the voting securities of the Trustee is
beneficially owned either by the Company or by any director, partner
or executive officer thereof, or 20% or more of such voting
securities is beneficially owned, collectively, by any two or more of
such persons; or 10% or more of the voting securities of the Trustee
is beneficially owned either by an underwriter for the Company or by
any director, partner, or executive officer thereof, or is
beneficially owned, collectively, by any two or more persons;
(6) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, (A) 5% or
more of the voting securities, or 10% or more of any other class of
security, of the Company, not including the Securities issued under
this Indenture and securities issued under any other indenture under
which the Trustee is also trustee, or (B) 10% or more of any class of
security of an underwriter for the Company;
(7) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, 5% or more
of the voting securities of any person who, to the knowledge of the
Trustee, owns 10% or more of the voting securities of, or controls
directly or indirectly or is under direct or indirect common control
with, the Company;
(8) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, 10% or
more of any class of security of any
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person who, to the knowledge of the Trustee, owns 50% or more of the
voting securities of the Company;
(9) the Trustee owns on the date of default upon the
Securities, or any anniversary of such default while such default
upon the Securities remains outstanding, in the capacity of executor,
administrator, testamentary or inter vivos trustee, guardian,
committee or conservator, or in any other similar capacity, an
aggregate of 25% or more of the voting securities, or of any class of
security, of any person, the beneficial ownership of a specified
percentage of which would have constituted a conflicting interest
under paragraphs (6), (7) or (8) of this subsection (c). As to any
such securities of which the Trustee acquired ownership through
becoming executor, administrator, or testamentary trustee of an
estate which included them, the provisions of the preceding sentence
shall not apply, for a period of two years from the date of such
acquisition, to the extent that such securities included in such
estate do not exceed 25% of such voting securities or 25% of any such
class of security. Promptly after the date of any such default upon
the Securities and annually in each succeeding year that the
Securities remain in default, the Trustee shall make a check of its
holdings of such securities in any of the above-mentioned capacities
as of such date. If the Company fails to make payment in full of
principal of (or premium, if any) or interest on any of the
Securities when and as the same becomes due and payable and such
failure continues for 30 days thereafter, the Trustee shall make a
prompt check of its holdings of such securities in any of the above-
mentioned capacities as of the date of the expiration of such 30-day
period, and after such date, notwithstanding the foregoing provisions
of this paragraph (9), all such securities so held by the Trustee,
with sole or joint control over such securities vested in it shall,
but only so long as such failure shall continue, be considered as
though beneficially owned by the Trustee for the purposes of para-
graphs (6), (7) and (8) of this subsection (c); or
(10) except under the circumstances described in paragraphs
(1), (3), (4), (5) or (6) of Section 8.13(b), the Trustee shall be or
shall become a creditor to the Company.
The specifications of percentages in paragraphs (5) to (9),
inclusive, of this subsection (c) shall not be
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construed as indicating that the ownership of such percentages of the
securities of a person is or is not necessary or sufficient to constitute
direct or indirect control for the purposes of paragraphs (3) or (7) of
this subsection (c).
For the purposes of paragraphs (6), (7), (8) and (9) of this
subsection (c) only, (A) the terms "security" and "securities" shall
include only such securities as are generally known as corporate
securities, but shall not include any note or other evidence of
indebtedness issued to evidence an obligation to repay moneys lent to a
person by one or more banks, trust companies or banking firms, or any
certificate of interest or participation in any such note or evidence of
indebtedness; (B) an obligation shall be deemed to be in default when a
default in payment of principal shall have continued for thirty days or
more and shall not have been cured; and (C) the Trustee shall not be deemed
to be the owner or holder of (i) any security which it holds as collateral
security (as trustee or otherwise) for an obligation which is not in
default as defined in clause (B) above, or (ii) any security which it holds
as collateral security under this Indenture, irrespective of any default
hereunder, or (iii) any security which it holds as agent for collection, or
as custodian, escrow agent, or depositary, or in any similar representative
capacity.
Except as above provided, the word "security" or "securities"
as used in this Indenture, shall mean any note, stock, treasury stock,
bond, debenture, evidence of indebtedness, certificate of interest or
participation in any profit-sharing agreement, collateral-trust
certificate, preorganization certification or subscription, transferable
share, investment contract, voting-trust certificate, certificate of
deposit for security, fractional undivided interest in oil, gas, or other
mineral rights, or in general, any interest or instrument commonly known as
a "security," or any certificate of interest or participation in, temporary
or interim certificate for, receipt for, guarantee of, or warrant or right
to subscribe to or purchase, any of the foregoing.
(d) For the purposes of this Section 8.08:
(1) The term "underwriter" when used with reference to the
Company shall mean every person, who, within one year prior to the
time as of which the determination is made, has purchased from the
Company with a view to, or has offered or sold for the Company in
connection with,
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the distribution of any security of the Company outstanding at such
time, or has participated or has had a direct or indirect
participation in any such undertaking, or has participated or has had
a participation in the direct or indirect underwriting of any such
undertaking, but such term shall not include a person whose interest
was limited to a commission from an underwriter or dealer not in
excess of the usual and customary distributor's or seller's
commission.
(2) The term "director" shall mean any director of a
corporation or any individual performing similar functions with
respect to any organization whether incorporated or unincorporated.
(3) The term "person" shall mean an individual, a
corporation, a partnership, an association, a joint-stock company, a
trust, an unincorporated organization, or a government or political
subdivision thereof. As used in this paragraph, the term "trust"
shall include only a trust where the interest or interests of the
beneficiary or beneficiaries are evidenced by a security.
(4) The term "voting security" shall mean any security
presently entitling the owner or holder thereof to vote in the
direction or management of the affairs of a person, or any security
issued under or pursuant to any trust, agreement or arrangement
whereby a trustee or trustees or agent or agents for the owner or
holder of such security are presently entitled to vote in the
direction or management of the affairs of a person.
(5) The term "Company" shall mean any obligor upon the
Securities.
(6) The term "executive officer" shall mean the president,
every vice president, every assistant vice president, every trust
officer, the cashier, the secretary, and the treasurer of a
corporation, and any individual customarily performing similar
functions with respect to any organization whether incorporated or
unincorporated, but shall not include the chairman of the board of
directors.
(7) The term "default" shall mean any event which is, or
after notice or lapse of time or both would become, an Event of
Default.
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The percentages of voting securities and other securities
specified in this Section 8.08 shall be calculated in accordance with the
following provisions:
(A) A specified percentage of the voting securities of the
Trustee, the Company or any other person referred to in this Sec-
tion 8.08 (each of whom is referred to as a "person" in this
paragraph) means such amount of the outstanding voting securities of
such person as entitles the holder or holders thereof to cast such
specified percentage of the aggregate votes which the holders of all
the outstanding voting securities of such person are entitled to cast
in the direction or management of the affairs of such person.
(B) A specified percentage of a class of securities of a
person means such percentage of the aggregate amount of securities of
the class outstanding.
(C) The term "amount," when used in regard to securities,
means the principal amount if relating to evidences of indebtedness,
the number of shares if relating to capital shares, and the number of
units if relating to any other kind of security.
(D) The term "outstanding" means issued and not held by or
for the account of the issuer. The following securities shall not be
deemed outstanding within the meaning of this definition:
(i) Securities of an issuer held in a sinking fund
relating to securities of the issuer of the same class;
(ii) Securities of an issuer held in a sinking fund
relating to another class of securities of the issuer, if the
obligation evidenced by such other class of securities is not
in default as to principal or interest or otherwise;
(iii) Securities pledged by the issuer thereof as
security for an obligation of the issuer not in default as to
principal or interest or otherwise; and
(iv) Securities held in escrow if placed in escrow by
the issuer thereof; provided, however, that any voting
securities of an issuer shall be deemed
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outstanding if any person other than the issuer is entitled to
exercise the voting rights thereof.
(E) A security shall be deemed to be of the same class as
another security if both securities confer upon the holder or holders
thereof substantially the same rights and privileges, provided,
however, that, in the case of secured evidences of indebtedness, all
of which are issued under a single indenture, differences in the
interest rates or maturity dates of various series thereof shall not
be deemed sufficient to constitute such series different classes, and
provided, further, that, in the case of unsecured evidences of
indebtedness, differences in the interest rates or maturity dates
thereof shall not be deemed sufficient to constitute them securities
of different classes, whether or not they are issued under a single
indenture.
(e) Except in the case of a default in the payment of the
principal of or interest on any Security, or in the payment of any sinking
or purchase fund installment, the Trustee shall not be required to resign
as provided by this Section 8.08 if the Trustee shall have sustained the
burden of proving on application to the Securities and Exchange Commission
(the "Commission") and after opportunity for hearing thereon, that:
(1) the default under the Indenture may be cured or waived
during a reasonable period and under the procedures described in such
application, and
(2) a stay of the Trustee's duty to resign will not be
inconsistent with the interests of the holders of the Securities.
The filing of such application shall automatically stay the
performance of the duty to resign until the Commission orders
otherwise.
Section 8.09. Requirements for eligibility of Trustee. The
Trustee hereunder shall at all times be a corporation organized and doing
business under the laws of the United States or any State or territory
thereof or of the District of Columbia authorized under such laws to
exercise corporate trust powers, having assets of at least one hundred
million dollars and a combined capital and surplus of at least twenty-five
million dollars, subject to supervision or examination by federal, state,
territorial, or District of Columbia authority. If such corporation
publishes reports of
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condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section 8.09, 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. In case at any time the Trustee
shall cease to be eligible in accordance with the provisions of this
Section 8.09, the Trustee shall resign immediately in the manner and with
the effect specified in Section 8.10.
Section 8.10. Resignation or removal of Trustee.
(a) The Trustee, or any trustee hereafter appointed, may at
any time resign with respect to the Securities of one or more series by
giving written notice of such resignation to the Company and to the holders
of Securities of such series, such notice to such holders to be given at
Company expense by mailing (by first-class mail) the same within thirty
days after such notice is given to the Company. Upon receiving such notice
of resignation and evidence satisfactory to it of such mailing, the Company
shall promptly appoint a successor trustee or trustees with respect to the
Securities of that or those series (it being understood that any such
successor trustee may be appointed with respect to the Securities of one or
more or all such series and that at any time there shall be only one
trustee with respect to the Securities of any particular series) by written
instrument, executed by order by the Board of Directors of the Company, one
copy of which instrument shall be delivered to the resigning Trustee and
one copy to each successor trustee. If no successor trustee or trustees
shall have been so appointed and have accepted appointment within sixty
days after the mailing of such notice of resignation, the resigning Trustee
may petition any court of competent jurisdiction for the appointment of a
successor trustee or trustees, or any holder of Securities of such series
who has been a bona fide holder of a Security or Securities of such series
for at least six months may, subject to the provisions of Section 7.08, on
behalf of himself and all others similarly situated, petition any such
court for the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribed,
appoint a successor trustee or trustees.
(b) In case at any time any of the following shall occur --
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(1) the Trustee shall fail to comply with the provisions of
subsection (a) of Section 8.08 after written request therefor by the
Company or by any securityholder who has been a bona fide holder of a
Security or Securities for at least six months, or
(2) the Trustee shall cease to be eligible in accordance with
the provisions of Section 8.09 and shall fail to resign after written
request therefor by the Company or by any such securityholder, or
(3) the Trustee shall become incapable of acting, or shall be
adjudged as bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation,
then, in any such case, the Company may remove the Trustee with respect to
all Securities and appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors of the Company, one
copy of which instrument shall be delivered to the trustee so removed and
one copy to the successor trustee, or, subject to the provisions of Sec-
tion 7.08, any securityholder who has been a bona fide holder of a Security
or Securities for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee with respect to all Securities and the
appointment of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and prescribed, remove the Trustee
with respect to all Securities and appoint a successor trustee.
(c) The holders of a majority in aggregate principal amount
of the Securities of any series at the time outstanding (determined as
provided in Article 9) may at any time remove the Trustee with respect to
the Securities of such series and appoint a successor trustee by written
instrument or instruments signed by such holders or their attorneys-in-fact
duly authorized, or by the affidavits of the permanent chairman and
secretary of a meeting of the holders evidencing the vote upon a resolution
or resolutions submitted thereto with respect to such removal and
appointment (as provided in Article Ten), and by delivery thereof to the
Trustee so removed, to the successor trustee and to the Company.
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(d) Any resignation or removal of the Trustee and appointment
of any successor trustee pursuant to any of the provisions of this Section
8.10 shall become effective upon acceptance of appointment by the successor
trustee as provided in Section 8.11.
Section 8.11. Acceptance of Appointment by Successor. (a)
In case of the appointment hereunder of a successor trustee with respect to
all Securities, every such successor trustee 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.
(b) In case of the appointment hereunder of a successor
trustee with respect to the Securities of one or more (but not all) series,
the Company, the retiring trustee and each successor trustee with respect
to the Securities of one or more series shall execute and deliver an
indenture supplemental hereto wherein each successor trustee shall accept
such appointment and which (1) shall contain such provisions as shall be
necessary or desirable to transfer and confirm to, and to vest in, each
successor trustee all the rights, powers, trusts and duties of the retiring
trustee with respect to the Securities of that or those series to which the
appointment of such successor trustee relates, (2) if the retiring trustee
is not retiring with respect to all Securities, shall contain such
provisions as shall be deemed necessary or desirable to confirm that all
the rights, powers, trusts and duties of the retiring trustee with respect
to the securities of that or those series as to which the retiring trustee
is not retiring shall continue to be vested in the retiring trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall
be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one trustee, it being understood that nothing herein
or in such supplemental indenture shall constitute such trustees
co-trustees of the same trust and that each such trustee shall be trustee
of a
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trust or trusts hereunder separate and apart from any trust or trusts
hereunder administered by any other such trustee; and upon the execution
and delivery of such supplemental indenture the resignation or removal of
the retiring trustee shall become effective to the extent provided therein
and each such successor trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring trustee with respect to the Securities of that or
those series to which the appointment of such successor trustee relates;
but on request of the Company or any successor trustee, such retiring
trustee shall duly assign, transfer and deliver to such successor trustee
all property and money held by such retiring trustee hereunder with respect
to the Securities of that or those series to which the appointment of such
successor trustee relates.
(c) Upon request of any such successor trustee, the Company
shall execute any and all instruments for more fully and certainly vesting
in and confirming to such successor trustee all right, powers and trusts
referred to in paragraph (a) or (b) of this Section, as he case may be.
(d) No successor trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be qualified
and eligible under this Article.
(e) The Company shall give notice of each resignation and
each removal of the trustee with respect to the Securities of any series
and each appointment of a successor trustee with respect to the Securities
of any series by mailing written notice of such event to all holders of
Securities of such series as their names and addresses appear in the
Security Register. Each notice shall include the name of the successor
trustee with respect to the Securities of such series and the address of
its Corporate Trust office.
Section 8.12. Successor to Trustee by merger, 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 or conversion or consolidation to
which the Trustee shall be party, or any corporation succeeding to the
corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, provided such corporation shall be qualified under the
provisions of Section 8.08 and eligible under the provisions of Sec-
tion 8.09, without the execution or filing of
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any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
In case at the time such successor to the Trustee shall succeed
to the trusts created by this Indenture and any of the Securities shall
have been authenticated but not delivered, any such successor to the
Trustee may adopt the certificate of authentication of any predecessor
Trustee, and deliver such Securities so authenticated; and in case at that
time any of the Securities shall not have been authenticated, any successor
to the Trustee may authenticate such Securities either in the name of any
predecessor hereunder or in the name of the successor trustee; and in all
such cases such certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the certificate of the
Trustee shall have; provided, however, that the right to adopt the
certificate of authentication of any predecessor Trustee or authenticate
Securities in the name of any predecessor Trustee shall apply only to its
successor or successors by merger, conversion or consolidation.
Section 8.13. Limitations on rights of Trustee as a creditor.
(a) Subject to the provisions of subsection (b) of this Sec-
tion 8.13, if the Trustee shall be or shall become a creditor, directly or
indirectly, secured or unsecured, of the Company within three months prior
to a default, as defined in subsection (c) of this Section 8.13, or
subsequent to such a default, then, unless and until such default shall be
cured or waived, the Trustee shall set apart and hold in a special account
for the benefit of the Trustee individually, the holders of the Securities,
and the holders of other indenture securities (as defined in subsection (c)
of this Section 8.13);
(1) an amount equal to any and all reductions in the amount
due and owing upon any claim as such creditor in respect of principal
or interest, effected after the beginning of such three-month period,
and valid as against the Company and its other creditors, except any
such reduction resulting from the receipt or disposition of any
property described in paragraph (2) of this subsection, or from the
exercise of any right of set-off which the Trustee could have
exercised if a petition in bankruptcy had been filed by or against
the Company upon the date of such default; and
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(2) all property received by the Trustee in respect of any
claims as such creditor, either as security therefor, or in
satisfaction or composition thereof, or otherwise, after the
beginning of such three-month period, or an amount equal to the
proceeds of any such property if disposed of, subject, however, to
the rights, if any, of the Company and its other creditors in such
property or such proceeds.
Nothing herein contained, however, shall affect the right of
the Trustee:
(A) to retain for its own account (i) payments made on
account of any such claim by any person (other than the Company) who
is liable thereon, and (ii) the proceeds of the bona fide sale of any
such claim by the Trustee to a third person, and (iii) distributions
made in cash, securities, or other property in respect of claims
filed against the Company in bankruptcy or receivership or in
proceedings for reorganization pursuant to the federal bankruptcy
laws or applicable state laws;
(B) to realize, for its own account, upon any property held
by it as security for any such claim, if such property was so held
prior to the beginning of such three-month period;
(C) to realize, for its own account, but only to the extent
of the claim hereinafter mentioned, upon any property held by it as
security for any such claim, if such claim was created after the
beginning of such three-month period and such property was received
as security therefor simultaneously with the creation thereof, and if
the Trustee shall sustain the burden of proving at the time such
property was so received the Trustee had no reasonable cause to
believe that a default, as defined in subsection (c) of this Sec-
tion 8.13 would occur within three months; or
(D) to receive payment on any claim referred to in para-
graph (B) or (C), against the release of any property held as
security for such claim as provided in such paragraph (B) or (C), as
the case may be, to the extent of the fair value of such property.
For the purposes of paragraphs (B), (C), and (D), property
substituted after the beginning of such three-month
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period for property held as security at the time of such substitution
shall, to the extent of the fair value of the property released, have the
same status as the property released, and to the extent that any claim
referred to in any such paragraphs is created in renewal of or in
substitution for or for the purpose of repaying or refunding any
preexisting claim of the Trustee as such creditor, such claim shall have
the same status as such preexisting claim.
If the Trustee shall be required to account, the funds and
property held in such special account and the proceeds thereof shall be
apportioned between the Trustee, the securityholders, and the holders of
other indenture securities in such manner that the Trustee, the
securityholders and the holders of other indenture securities realize, as a
result of payments from such special account and payments of dividends on
claims filed against the Company in bankruptcy or receivership or in
proceedings for reorganization pursuant to the federal bankruptcy laws or
applicable state law, the same percentage of their respective claims,
figured before crediting to the claim of the Trustee anything on account of
receipt by it from the Company of the funds and property in such special
account and before crediting to the respective claims of the Trustee, the
securityholders, and the holders of other indenture securities dividends on
claims filed against the Company in bankruptcy or receivership or in
proceedings for reorganization pursuant to the federal bankruptcy laws or
applicable state law, but after crediting thereon receipts on account of
the indebtedness represented by their respective claims from all sources
other than from such dividends and from the funds and property so held in
such special account. As used in this paragraph, with respect to any
claim, the term "dividends" shall include any distribution with respect to
such claim in bankruptcy or receivership or in proceedings for
reorganization pursuant to the federal bankruptcy laws or applicable state
law, whether such distribution is made in cash, securities, or other
property, but shall not include any such distribution with respect to the
secured portion, if any, of such claim. The court in which such
bankruptcy, receivership or proceeding for reorganization is pending shall
have jurisdiction (i) to apportion between the Trustee, the
securityholders, and the holders of other indenture securities, in
accordance with the provisions of this paragraph, the funds and property
held in such special account and the proceeds thereof, or (ii) in lieu of
such apportionment, in whole or in part, to give to the provisions of this
paragraph due consideration in determining the fairness of the
distributions to be made to the Trustee,
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the securityholders and the holders of other indenture securities with
respect to their respective claims, in which event it shall not be
necessary to liquidate or to appraise the value of any securities or other
property held in such special account or as security for any such claim, or
to make a specific allocation of such distributions as between the secured
and unsecured portions of such claims, or otherwise to apply the provisions
of this paragraph as a mathematical formula.
Any Trustee who has resigned or been removed after the
beginning of such three-month period shall be subject to the provisions of
this subsection (a) as though such resignation or removal had not occurred.
If any Trustee has resigned or been removed prior to the beginning of such
three-month period, it shall be subject to the provisions of this
subsection (a) if and only if the following conditions exist:
(i) the receipt of property or reduction of claim which would
have given rise to the obligation to account, if such Trustee had
continued as trustee, occurred after the beginning of such three
month period; and
(ii) such receipt of property or reduction of claim occurred
within three months after such resignation or removal.
(b) there shall be excluded from the operation of subsection
(a) of this Section 8.13 a creditor relationship arising from
(1) the ownership or acquisition of securities issued under
any indenture, or any security or securities having a maturity of one
year or more at the time of acquisition by the Trustee;
(2) advances authorized by a receivership or bankruptcy court
of competent jurisdiction, or by this Indenture, for the purpose of
preserving any property which shall at any time be subject to the
lien of this Indenture or of discharging tax liens or other prior
liens or encumbrances thereon, if notice of such advance and of the
circumstances surrounding the making thereof is given to the
securityholders at the time and in the manner provided in Sec-
tion 6.04 with respect to reports pursuant to subsections (a) and (b)
thereof, respectively;
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(3) disbursements made in the ordinary course of business in
the capacity of trustee under an indenture, transfer agent,
registrar, custodian, paying agent, fiscal agent or depositary, or
other similar capacity;
(4) an indebtedness created as a result of services rendered
or premises rented; or an indebtedness created as a result of goods
or securities sold in a cash transaction as defined in subsection (c)
of this Section 8.13;
(5) the ownership of stock or of other securities of a
corporation organized under the provisions of Section 25(a) of the
Federal Reserve Act, as amended, which is directly or indirectly a
creditor of the Company; or
(6) the acquisition, ownership, acceptance or negotiation of
any drafts, bills of exchange, acceptances or obligations which fall
within the classification of self-liquidating paper as defined in
subsection (c) of this Section 8.13.
(c) As used in this Section 8.13:
(1) The term "default" shall mean any failure to make payment
in full of the principal or interest upon any of the Securities or
upon the other indenture securities when and as such principal or
interest becomes due and payable.
(2) The term "other indenture securities" shall mean
securities upon which the Company is an obligor (as defined in the
Trust Indenture Act of 1939, as amended), outstanding under any other
indenture (A) under which the Trustee is also trustee, (B) which
contains provisions substantially similar to the provisions of
subsection (a) of this Section 8.13, and (C) under which a default
exists at the time of the apportionment of the funds and property
held in said special account.
(3) The term "cash transaction" shall mean any transaction in
which full payment for goods or securities sold is made within seven
days after delivery of the goods or securities in currency or in
checks or other orders drawn upon banks or bankers and payable upon
demand.
(4) The term "self-liquidating paper" shall mean any draft,
bill of exchange, acceptance or obligation which is
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made, drawn, negotiated or incurred by the Company for the purpose of
financing the purchase, processing, manufacture, shipment, storage or
sale of goods, wares or merchandise and which is secured by documents
evidencing title to, possession of, or a lien upon, the goods, wares
or merchandise or the receivables or proceeds arising from the sale
of goods, wares or merchandise previously constituting the security,
provided the security is received by the Trustee simultaneously with
the creation of the creditor relationship with the Company arising
from the making, drawing, negotiating or incurring of the draft, bill
of exchange, acceptance or obligation.
(5) The term "Company" shall mean any obligor upon the
Securities.
ARTICLE NINE
Concerning the Securityholders
Section 9.01. Evidence of action by securityholders. Whenever
in this Indenture it is provided that the holder of a specified percentage
in aggregate principal amount of the Securities of a series may take any
action (including the making of any demand or request, the giving of any
notice, consent, or waiver or the taking of any other action) the fact that
the holders of such specified percentage, determined as of the time such
action was taken or, if a record date was set with respect thereto pursuant
to Section 9.05, as of such record date, have joined therein may be
evidenced (a) by any instrument or any number of instruments of similar
tenor executed by securityholders of that series in person or by agent or
proxy appointed in writing, or (b) by the record of the holders of
Securities of that series voting in favor thereof at any meeting of
securityholders of that series duly called and held in accordance with the
provisions of Article Ten, or (c) by combination of such instrument or
instruments and any such record of such meeting of securityholders of that
series.
Section 9.02. Proof of execution of instrument and of holding
of Securities. Subject to the provisions of Sections 8.01, 8.02 and 10.05,
proof of the execution of any instrument by a securityholder or his agent
or proxy shall be sufficient if made in accordance with such reasonable
rules and
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regulations as may be prescribed by the Trustee or in such manner as shall
be satisfactory to the Trustee.
The ownership of Securities shall be proved by the Security
Register, or by a certificate of the registrar thereof.
The Trustee may accept such other proof or require such
additional proof of any matter referred to in this Section 9.02 as it shall
deem reasonable.
The record of any securityholders' meeting shall be proved in
the manner provided in Section 10.06.
Section 9.03. Who may be deemed owners of Securities. The
Company, the Trustee, any paying agent and any Security registrar may deem
and treat the person in whose name any Security shall be registered upon
the books of the Company as the absolute owner of such Security (whether or
not such Security shall be overdue and notwithstanding any notation of
ownership or other writing thereon) for the purpose of receiving payment of
or on account of the principal and interest on such Security and for all
other purposes; and neither the Company nor the Trustee nor any paying
agent nor any Security registrar shall be affected by any notice to the
contrary. All such payments so made to, or upon the order of, any such
holder shall be valid, and, to the extent of the sum or sums so paid,
effectual to satisfy and discharge the liability for moneys payable upon
any such Security. Notwithstanding anything to the contrary contained
herein, any sale, transfer, or assignment of a Security shall be effective
only upon registration of the name of the transferee in the Security
register.
Section 9.04. Securities owned by Company or controlled or
controlling persons disregarded for certain purposes. In determining
whether the holders of the requisite aggregate principal amount of
Securities have concurred in any demand, direction, request, notice,
consent, waiver or other action under this Indenture, Securities which are
owned by the Company or any other obligor on the Securities or by any
person directly or indirectly controlling or controlled by or under direct
or indirect common control with the Company or any other obligor on the
Securities shall be disregarded and deemed not to be outstanding for the
purpose of any such determination, provided that for the purposes of
determining whether the Trustee shall be protected in relying on any such
demand,
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direction, request, notice, consent or waiver, only Securities which the
Trustee knows are so owned shall be disregarded. Securities so owned which
have been pledged in good faith may be regarded as outstanding for the
purposes of this Section 9.04 if the pledgee shall establish to the
satisfaction of the Trustee the pledgee's right to vote such Securities and
that the pledgee is not a person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company
or any such other obligor. In case of a dispute as to such right, any
decision by the Trustee taken upon the advice of counsel shall be full
protection to the Trustee.
Section 9.05. Record date for action by securityholders.
Whenever in this Indenture it is provided that holders of a specified
percentage in aggregate principal amount of the Securities of a series may
take any action (including the making of any demand or request, the giving
of any direction, notice, consent or waiver or the taking of any other
action), other than any action taken at a meeting of securityholders called
pursuant to Article Ten, the Company, pursuant to a resolution of its Board
of Directors, or the holders of at least 10% in aggregate principal amount
of the Securities of that series then outstanding, may request the Trustee
to fix a record date for determining securityholders entitled to notice of
and to take any such action. In case the Company or the holders of
Securities of that series in the amount specified shall desire to request
securityholders to take any such action and shall request the Trustee to
fix a record date with respect thereto by written notice setting forth in
reasonable detail the securityholder action to be requested, the Trustee
shall promptly (but in any event within five days of receipt of such
request) fix a record date which shall be a business day not less than 15
nor more than 20 days after the date on which the Trustee receives such
request. If the Trustee shall fail to fix a record date as hereinabove
provided, then the Company or the holders of Securities of that series in
the amount above specified may fix the same by mailing written notice
thereof (the record date to be fixed to be a business day not less than 15
nor more than 20 days after the date on which such written notice shall be
given) to the Trustee. If a record date is fixed according to this Section
9.05, only persons shown as securityholders of that series on the
registration books of the Company at the close of business on the record
date so fixed shall be entitled to take the requested action and the taking
of such action by the holders on the record date of the required percentage
of the aggregate
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principal amount of the Securities of that series shall be binding on all
securityholders of that series, provided that the taking of the requested
action by the holders on the record date of the percentage in aggregate
principal of the Securities of that series specified in this Indenture in
connection with such action shall have been evidenced to the Trustee, as
provided in Section 9.01, not later than 180 days after such record date.
Section 9.06. Instruments executed by securityholders bind
future holders. At any time prior to (but not after) the evidencing to the
Trustee, as provided in Section 9.01, of the taking of any action by the
holders of the percentage in aggregate principal amount of the Securities
of a series specified in this Indenture in connection with such action, any
holder of a Security of that series which is shown by the evidence to be
included in the Securities the holders of which have consented to such
action may, by filing written notice with the Trustee at its principal
corporate trust office and upon proof of holding as provided in Section
9.02, revoke such action so far as concerns such Security. Except as
aforesaid any such action taken by the holder of any Security of that
series and any direction, demand, request, waiver, consent, vote or other
action of the holder of any Security which by any provisions of this
Indenture is required or permitted to be given shall be conclusive and
binding upon such holder and upon all future holders and owners of such
Security, and of any Security issued in lieu thereof, irrespective of
whether or not any notation in regard thereto is made upon such Security.
Any action taken by the holders of the percentage in aggregate principal
amount of the Securities specified in this Indenture in connection with
such action shall be conclusively binding upon the Company, the Trustee and
the holders of all the Securities of that series.
ARTICLE TEN
Securityholders' Meetings
Section 10.01. Purposes for which meetings may be called. A
meeting of securityholders of a series may be called at any time and from
time to time pursuant to the provisions of this Article Ten for any of the
following purposes:
(1) to give any notice to the Company or to the Trustee, or
to give any directions to the Trustee, or to
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consent to the waiving of any default hereunder and its consequences,
or take any other action authorized to be taken by securityholders of
a series pursuant to any of the provisions of Article Seven;
(2) to remove the Trustee and appoint a successor trustee
pursuant to the provisions of Article Eight;
(3) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 11.02; or
(4) to take any other action authorized to be taken by or on
behalf of the holders of any specified aggregate principal amount of
the Securities of a series under any other provisions of this
Indenture or under applicable law.
Section 10.02. Manner of calling meetings; record date. The
Trustee may at any time call a meeting of securityholders of a series to
take any action specified in Section 10.01, to be held at such time and at
such place as the Trustee shall reasonably determine. Notice of every
meeting of the securityholders of that series, setting forth the time and
the place of such meeting and in general terms the action proposed to be
taken at such meeting shall be mailed not less than 20 nor more than 60
days prior to the date fixed for the meeting to such securityholders at
their registered addresses. For the purposes of determining
securityholders entitled to notice of any meeting of securityholders of
that series, the Trustee shall fix in advance a date as the record date for
such determination, such date to be a business day not more than 10 days
prior to the date of the mailing of such notice as hereinabove provided.
Only persons in whose name any Security of that series shall be registered
upon the books of the Company on a record date fixed by the Trustee as
aforesaid, or by the Company or the securityholders as in Section 10.03
provided, shall be entitled to notice of the meeting of securityholders of
that series with respect to which such record date was fixed.
Section 10.03. Call of meeting by Company or securityholders.
In case at any time the Company, pursuant to a resolution of its Board of
Directors, or the holders of at least 10% in aggregate principal amount of
the Securities of a series then outstanding, shall have requested the
Trustee to call a meeting of securityholders of a series to take any
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action authorized in Section 10.01 by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have mailed notice of such meeting within 20 days after
receipt of such request, then the Company or the holders of the Securities
of that series in the amount above specified, as the case may be, may fix
the record date with respect to, and determine the time and the place in
said City of Englewood, Colorado, for, such meeting and may call such
meeting to take any action authorized in Section 10.01, by mailing notice
thereof as provided in Section 10.02. The record date fixed as provided in
the preceding sentence shall be set forth in a written notice to the
Trustee and shall be a business day not less than 15 nor more than 20 days
after the date on which such notice is sent to the Trustee.
Section 10.04. Who may attend and vote at meetings. Only
persons entitled to receive notice of a meeting of securityholders and
their respective proxies duly appointed by an instrument in writing shall
be entitled to vote at such meeting. The only persons who shall be
entitled to be present or to speak at any meeting of securityholders shall
be the persons entitled to vote at such meeting and their counsel and any
representatives of the Trustee and its counsel and any representatives of
the Company and its counsel. When a determination of securityholders
entitled to vote at any meeting of securityholders has been made as
provided in this section, such determination shall apply to any adjournment
thereof.
Section 10.05. Regulations. Notwithstanding any other
provisions of this Indenture, the Trustee may make such reasonable
regulations as it may deem advisable for any meeting of securityholders of
a series, in regard to proof of the holding of Securities of that series
and of the appointment of proxies, and in regard to the appointment and
duties of inspectors of votes, the submission and examination of proxies,
certificates and other evidence of the right to vote, and such other
matters concerning the conduct of the meeting as it shall think fit.
Except as otherwise permitted or required by any such regulations, the
holding of Securities shall be proved in the manner specified in Section
9.02.
The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been
called by the Company or by securityholders as provided in Section 10.03,
in which case the Company or the
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securityholders calling the meeting, as the case may be, shall in like
manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by a vote of the holders of a
majority in principal amount of the Securities represented at the meeting
and entitled to vote.
Subject to the provisions of Section 9.04, at any meeting each
securityholder of a series or proxy entitled to vote thereat shall be
entitled to one vote for each $1,000 principal amount of Securities of that
series held or represented by him, provided, however, that no vote shall be
cast or counted at any meeting in respect of any Security challenged as not
outstanding and ruled by the chairman of the meeting to be not outstanding.
The chairman of the meeting shall have no right to vote other than by
virtue of Securities held by him or instruments in writing as aforesaid
duly designated him as the person to vote on behalf of other
securityholders. Any meeting of securityholders duly called pursuant to
the provisions of Section 10.02 or 10.03 may be adjourned from time to
time, and the meeting may be held as so adjourned without further notice.
At any meeting of securityholders of a series, the presence of
persons who held, or who are acting as proxy for persons who held, an
aggregate principal amount of Securities of that series on the record date
for such meeting sufficient to take action on the business for the
transaction of which such meeting was called shall constitute a quorum,
but, if less than a quorum is present, the persons holding or representing
a majority in aggregate principal amount of the Securities of that series
represented at the meeting may adjourn such meeting with the same effect,
for all intents and purposes, as though a quorum had been present.
Section 10.06. Manner of voting at meeting and record to be
kept. The vote upon any resolution submitted to any meeting of
securityholders shall be by written ballots on each of which shall be
subscribed the signature of the securityholder or proxy casting such ballot
and the identifying number or numbers of the Securities held or represented
in respect of which such ballot is cast. The permanent chairman of the
meeting shall appoint two inspectors of votes who shall count all votes
cast at the meeting for or against any resolution and who shall make and
file with the secretary of the meeting their verified written reports in
duplicate of all votes cast at the meeting. A record in duplicate of the
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proceedings of each meeting of securityholders shall be prepared by the
secretary of the meeting and there shall be attached to said record the
original reports of the inspectors of votes on any vote by ballot taken
thereat and affidavits by one or more persons having knowledge of the facts
setting forth a copy of the notice of the meeting and showing that said
notice was mailed as provided in Section 10.02. The record shall show the
identifying numbers of the Securities voting in favor of or against any
resolution. Each counterpart of such record shall be signed and verified
by the affidavits of the permanent chairman and secretary of the meeting
and one of the counterparts shall be delivered to the Company and the other
to the Trustee to be preserved by the Trustee.
Any counterpart record so signed and verified shall be
conclusive evidence of the matters therein stated and shall be the record
referred to in clause (b) of Section 9.01.
Section 10.07. Exercise of rights of Trustee and
securityholders not to be hindered or delayed. Nothing in this Article Ten
contained shall be deemed or construed to authorize or permit, by reason of
any call of a meeting of holders of Securities of a series or any right
expressly or impliedly conferred hereunder to make such call, any hindrance
or delay in the exercise of any right or rights conferred upon or reserved
to the Trustee or to the holders of Securities of such series under any of
the provisions of this Indenture or of the Securities.
ARTICLE ELEVEN
Supplemental Indentures
Section 11.01. Purposes for which supplemental indentures may
be entered into without consent of securityholders. The Company, when
authorized by a Board Resolution, and the Trustee may from time to time and
at any time enter into an indenture or indentures supplemental hereto
(which shall comply with the provisions of the Trust Indenture Act of 1939,
as amended, as then in effect) for one or more of the following purposes:
(a) to evidence the succession of another corporation to the
Company, or successive successions, and the assumption by the
successor corporation of the
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covenants, agreements and obligations of the Company pursuant to
Article Twelve;
(b) to add to the covenants of the Company such further
covenants, restrictions or conditions as its Board of Directors and
the Trustee shall consider to be for the protection of the holders of
all or any series of Securities, and to make the occurrence, or the
occurrence and continuance, of a default in any of such additional
covenants, restrictions or conditions a default or an Event of
Default permitting the enforcement of all or any of the several
remedies provided in this Indenture as herein set forth; provided,
however, that in respect of any such additional covenant, restriction
or condition, such supplemental indenture may provide for a
particular period of grace after default (which period may be shorter
or longer than that allowed in the case of other defaults) or may
provide for an immediate enforcement upon such default or may limit
the remedies available to the Trustee upon such default;
(c) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture which may
be defective or inconsistent with any other provision contained
herein or in any supplemental indenture, or to make such other
provisions in regard to matters or questions arising under this
Indenture or any supplemental indenture as shall not materially
adversely affect the interests of the holders of the Securities of
any series; and
(d) to provide for the issuance under this Indenture of
Securities, whether or not then outstanding, in coupon form
(including Securities registrable as to principal only) and to
provide for exchangeability of such Securities with Securities issued
hereunder in fully registered form and to make all appropriate notice
provision and other changes for such purpose.
(e) to establish the form or terms of Securities of any
series as permitted by Sections 1.03 and 2.01.
The Trustee is hereby authorized to join with the Company in
the execution of any such supplemental indenture, to make any further
appropriate agreements and stipulations which may be therein contained and
to accept the conveyance, transfer, mortgage, pledge or assignment of any
property
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thereunder, provided that if any such supplemental indenture affects the
Trustee's own rights, duties or immunities under this Indenture or
otherwise, the Trustee may in its discretion, but shall not be obligated
to, enter into such supplemental indenture.
Any supplemental indenture authorized by the provisions of this
Section 11.01 may be executed by the Company and the Trustee without the
consent of the holders of any of the Securities at the time outstanding,
notwithstanding any of the provisions of Section 11.02.
Section 11.02. Modification of Indenture with consent of
holders of a majority in principal amount of Securities of a Series. With
the consent (evidenced as provided in Section 9.01) of the holders of not
less than a majority in aggregate principal amount of the Securities of
each series affected by such supplemental indenture at the time outstanding
(determined as provided in Section 9.04) as of such record date, the
Company, when authorized by a Board Resolution, and the Trustee may from
time to time and at any time enter into an indenture or indentures
supplemental hereto (which shall comply with the provisions of the Trust
Indenture Act of 1939, as amended, as then in effect) for the purpose of
adding any provisions to or changing in any manner or eliminating any of
the provisions of this Indenture (including, but without limitation, those
relating to any sinking fund obligations) or of any supplemental indenture
or modifying in any manner the rights of the holders of the Securities of
such series; provided, however, that no such supplemental indenture shall
(i) extend the Stated Maturity of any Security, or reduce the rate or
extend the time of payment of interest thereon, or reduce the principal
amount thereof or impair the right to institute suit for the enforcement of
any such payment on or after the Stated Maturity thereof (or, in the case
of redemption, on or after the redemption date), without the consent of the
holder of each Security so affected, or (ii) reduce the aforesaid
percentage of Securities of any series, the consent of the holders of which
is required for any such supplemental indenture, without the consent of the
holders of all Securities of that series then outstanding; or (iii) modify
any of the provisions of this Section 11.02, 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
Security affected thereby.
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Upon the request of the Company, accompanied by a copy of a
Board Resolution certified by the Secretary or an Assistant Secretary of
the Company authorizing the execution of any such supplemental indenture,
and upon the filing with the Trustee of evidence of the consent of
securityholders as aforesaid, the Trustee shall join with the Company in
the execution of such supplemental indenture, provided that if such
supplemental indenture materially adversely affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, the Trustee
may in its discretion, but shall not be obligated to, enter into such
supplemental indenture.
It shall not be necessary for the consent of the
securityholders under this Section 11.02 to approve the particular form of
any proposed supplemental indenture, but it shall be sufficient if such
consent shall approve the substance thereof.
Promptly after the execution by the Company and the Trustee of
any supplemental indenture pursuant to the provisions of this Section
11.02, the Company shall mail a notice to the securityholders, setting
forth in general terms the substance of such supplemental indenture. Any
failure of the Company to mail such notice, or any defect therein, shall
not, however, in any way impair or affect the validity of any such
supplemental indenture.
Section 11.03. Effect of supplemental indentures. Upon the
execution of any supplemental indenture pursuant to the provisions of this
Article Eleven, this Indenture shall be and be deemed to be modified and
amended in accordance therewith and the respective rights, limitations of
rights, obligations, duties and immunities under this Indenture of the
Trustee, the Company and the holders of Securities shall thereafter be
determined, exercised and enforced hereunder subject in all respects to
such modifications and amendments, and all the terms and conditions of any
such supplemental indenture shall be and be deemed to be part of the terms
and conditions of this Indenture for any and all purposes.
Section 11.04. Securities may bear notation of changes by
supplemental indentures. Securities of any series authenticated and
delivered after the execution of any supplemental indenture pursuant to the
provisions of this Article Eleven, or after any action taken at a
securityholders' meeting pursuant to Article Ten, may bear a notation in
form approved by the Trustee and the Company as to any matter
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provided for in such supplemental indenture or as to any action taken at
any such meeting. If the Company or the Trustee shall so determine, new
Securities of a series so modified as to conform, in the opinion of the
Trustee and the Board of Directors of the Company, to any modification of
this Indenture contained in any such supplemental indenture may be prepared
by the Company, authenticated by the Trustee and delivered in exchange for
the Securities of that series then outstanding.
Section 11.05. Opinion of Counsel. The Trustee may rely upon
an Opinion of Counsel as conclusive evidence that any such supplemental
indenture complies with the provisions of this Article Eleven.
Section 11.06. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall conform to
the requirements of the Trust Indenture Act of 1939, as amended, as then in
effect if this Indenture shall then be qualified under that Act.
ARTICLE TWELVE
Consolidation, Merger and Sale
Section 12.01. Company may consolidate, etc., only on certain
terms. The Company shall not consolidate or merge with or into, or sell,
assign, transfer, lease, convey or otherwise dispose of its assets as an
entirety or substantially as an entirety to any Person unless
(a) immediately after such consolidation, merger, sale, assignment,
transfer, lease, conveyance or other disposition, the entity (whether the
Company or such other corporation) formed by or surviving any such
consolidation or merger, or to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made, shall not be
in default in performance or observance of any of the terms, covenants and
conditions of this Indenture to be kept or performed by the Company and no
Event of Default shall have occurred and be continuing; (b) the entity (if
other than the Company) formed by or surviving any such consolidation or
merger, or to which such sale, assignment, transfer, lease, conveyance or
other disposition shall have been made, shall be a corporation organized
and existing under the laws of the United States of America or any State
thereof or the District of Columbia; and (c) the due and punctual payment
of the principal of and interest on all of the Securities, according to
their tenor, and the due and punctual
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performance and observance of all the covenants and conditions of this
Indenture to be performed or observed by the Company, shall be expressly
assumed, by supplemental indenture complying with the requirements of
Article Eleven, satisfactory in form to the Trustee, executed and delivered
to the Trustee by the corporation formed by such consolidation, or into
which the Company shall have been merged, or by the corporation which shall
have acquired such property; provided, however, that the granting of a
security interest or creation of a lien shall not in and of itself
constitute a sale, assignment, transfer, lease, conveyance or other
disposition. If at any time there be any consolidation or merger or sale
or conveyance of property to which the covenant of this Section 12.01 is
applicable, then in any such event the successor corporation will promptly
deliver to the Trustee:
(1) an Officers' Certificate stating that as of the time
immediately after the effective date of any such transaction the
covenants of the Company contained in this Section 12.01 have been
complied with and the successor corporation is not in default under
the provisions of the Indenture; and
(2) an Opinion of Counsel stating that in his opinion such
covenants have been complied with and that any instrument or
instruments executed in the performance of such covenants comply with
the requirements thereof.
Section 12.02. Successor corporation to be substituted. In
case of any such consolidation, merger, sale, assignment, transfer, lease,
conveyance or other disposition and upon the assumption by the successor
corporation, in the manner hereinabove provided, of the due and punctual
payment of the principal of, and premium (if any), and interest on all the
Securities and the due and punctual performance and observance of all of
the covenants and conditions of this Indenture to be performed or observed
by the Company, such successor corporation shall succeed to and be
substituted for the Company, with the same effect as if it had been named
herein as the party of the first part and all obligations of the
predecessor corporation shall thereafter cease. Such successor corporation
thereupon may cause to be signed, and may issue either in its own name or
in the name of the Company, any or all of the Securities issuable hereunder
which theretofore shall not have been signed by the Company and delivered
to the Trustee; and, upon the order of such successor corporation (instead
of the Company) and subject to all the terms,
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conditions and limitations in this Indenture prescribed, the Trustee shall
authenticate and shall deliver any Securities which previously shall have
been signed and delivered by the officers of the Company to the Trustee for
authentication, and any Securities which such successor corporation
thereafter shall cause to be signed and delivered to the Trustee for that
purpose. All the Securities so issued shall in all respects have the same
legal rank and benefit under this Indenture as the Securities theretofore
or thereafter issued in accordance with the terms of this Indenture as
though all of such Securities had been issued at the date of the execution
hereof.
In case of any such consolidation, merger, sale, assignment,
transfer, lease, conveyance or other disposition such changes in
phraseology and form (but not in substance) may be made in the Securities
thereafter to be issued as may be appropriate.
Section 12.03. Opinion of Counsel. The Trustee, subject to
the provisions of Sections 8.01 and 8.02, may receive and rely on an
Opinion of Counsel as conclusive evidence that any such consolidation,
merger, sale, assignment, transfer, lease, conveyance or other disposition
and any such assumption, complies with the provisions of this Article
Twelve.
ARTICLE THIRTEEN
Satisfaction and Discharge of Indenture;
Unclaimed Moneys
Section 13.01. Satisfaction and discharge of Indenture. If
(a) the Company shall deliver to the Trustee for cancellation all
Securities of any series theretofore authenticated (other than any
Securities of such series which shall have been destroyed, lost or stolen
and which shall have been replaced or paid as provided in Section 2.07) and
not theretofore cancelled, or (b) all the Securities of any series not
theretofore cancelled or delivered to the Trustee for cancellation shall
have become due and payable, or are by their terms to become due and
payable within one year or are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the giving of notice of
redemption, and the Company shall deposit with the Trustee as trust funds
the entire amount sufficient to pay at maturity or upon redemption all of
such Securities of such series not
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theretofore cancelled or delivered to the Trustee for cancellation,
including principal and interest due or to become due to such date of
maturity or redemption date, as the case may be, and if in either case the
Company shall also pay or cause to be paid all other sums payable hereunder
by the Company with respect to the Securities of such series then (except
as otherwise provided in this Article Thirteen) this Indenture shall cease
to be of further effect with respect to the Securities of such series, and
the Trustee, on demand of the Company and at the cost and expense of the
Company, shall execute proper instruments acknowledging satisfaction of and
discharging this Indenture with respect to the Securities of such series;
the Company, however, hereby agrees to reimburse the Trustee for any costs
or expenses theretofore and thereafter reasonably and properly incurred by
the Trustee in connection with this Indenture or the Securities of such
series.
Section 13.02. Application by Trustee of funds deposited for
payment of Securities. All moneys deposited with the Trustee pursuant to
Section 13.01 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 particular Securities, for
the payment or redemption of which such moneys have been deposited with the
Trustee, of all sums due and to become due thereon for principal of, and
premium (if any), and interest.
Section 13.03. Repayment of moneys held by paying agent. 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 paid to the Trustee and thereupon
such paying agent shall be released from all further liability with respect
to such moneys.
Section 13.04. Repayment of moneys held by Trustee. Any
moneys deposited with the Trustee or any paying agent for the payment of
the principal of, and premium (if any), or interest on any Securities and
not applied but remaining unclaimed by the holders of Securities for two
years after the date upon which such payment shall have become due, shall
be repaid to the Company by the Trustee or by such paying agent on demand;
and thereupon the Trustee and such paying agent shall be released from all
further liability with respect to such moneys, and the holder of any of the
Securities entitled to receive such payment shall thereafter look only to
the Company
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for the payment thereof; provided, however, that the Trustee or any paying
agent before being required to make any such repayment may at the expense
of the Company mail to each holder or cause to be published once in a
financial newspaper, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than thirty days
from the date of such publication, any unclaimed balance of such money then
remaining will be repaid to the Company.
ARTICLE FOURTEEN
Immunity of Incorporators, Shareholders,
Officers, Directors and Employees
Section 14.01. Incorporators, shareholders, officers,
directors and employees of Company exempt from individual liability. No
recourse under or upon any obligation, covenant or agreement of this
Indenture, or of any Securities, or for any claim based thereon or
otherwise in respect thereof, shall be had against any incorporator,
shareholder, officer, director or employee as such, past, present or
future, of the Company or of any successor corporation, either directly or
through the Company, whether by virtue of any constitution, statute or rule
of law, or by the enforcement of any assessment or penalty or otherwise; it
being expressly understood that this Indenture and the obligations issued
hereunder are solely corporate obligations, and that no such personal
liability whatever shall attach to, or is or shall be incurred by, the
incorporators, shareholders, officers, directors or employees as such, of
the Company or of any successor corporation, or any of them, because of the
creation of the indebtedness hereby authorized, or under or by reason of
the obligations, covenants or agreements contained in this Indenture or in
any of the Securities or implied therefrom; that any and all such personal
liability of every name and nature, either at common law or in equity or by
constitution or statute, of, and any and all such rights and claims
against, every such incorporator, shareholder, officer, director or
employee as such, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or
agreements contained in this Indenture or in any of the Securities or
implied therefrom are hereby expressly waived and released as a condition
of, and as a consideration for, the execution of this Indenture and the
issue of such Securities.
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ARTICLE FIFTEEN
Miscellaneous Provisions
Section 15.01. Successors and assigns of Company bound by
Indenture. All the covenants, stipulations, promises and agreements in
this Indenture contained by or in behalf of the Company shall bind its
successors and assigns, whether so expressed or not.
Section 15.02. Acts of board, committee or officers of
successor corporation valid. Any act or proceeding by any provision of
this Indenture authorized or required to be done or performed by any board,
committee or officer of the Company shall and may be done and performed
with like force and effect by the board, committee or officer of any
corporation that shall at the time be the lawful sole successor of the
Company.
Section 15.03. Required notices or demands may be served by
mail; waiver. Any notice or demand which by any provisions of this
Indenture is required or permitted to be given or served by the Trustee or
by the holders of Securities to or on the Company may be given or served by
being deposited, first class postage prepaid, in a post office letter box
addressed (until another address is filed by the Company with the Trustee
for such purpose), as follows: Jones Intercable, Inc., 9697 E. Mineral
Avenue, Englewood, Colorado 80112, marked to the attention of the
President. Any notice, direction, request or demand by any securityholder
to or upon the Trustee shall be deemed to have been sufficiently given or
made, for all purposes, if given or made at the principal corporate trust
office of the Trustee in the State of California which on the date hereof
is located at 555 South Flower Street, Suite 2700, Los Angeles, California,
Attention: Corporate Trust Department, Telecopier No.: (213) 488-4039.
Where this Indenture provides for notice to securityholders 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 securityholder 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.
Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the person
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entitled to receive such notice, either before or after the event or action
relating thereto, and such waiver shall be equivalent of such notice.
Waivers of notice by securityholders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any
action taken in reliance upon such waiver.
Section 15.04. Indenture and Securities to be construed in
accordance with the laws of the State of Colorado. This Indenture and each
Security shall be deemed to a contract made under the laws of the State of
Colorado, and for all purposes shall be governed by and construed in
accordance with the laws of said State.
Section 15.05. Evidence of compliance with conditions
precedent. Upon any request or application by the Company to the Trustee
to take any action under any of the provisions 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, except that in the case of
any such application or demand as to which the furnishing of such document
is specifically required by any provision of this Indenture relating to
such particular application or demand, no additional certificate or opinion
need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or
covenant provided for in this Indenture shall include (1) a statement that
the person making such certificate or opinion has read such covenant or
condition; (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 such person, he has made such examination or
investigation as is necessary to enable him to express an informed opinion
as to whether or not such covenant or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such person, such
condition or covenant has been complied with.
Any certificate, statement 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 that the certificate or opinion or representations with
respect to the matters upon
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which his certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the same
are erroneous. Any certificate, statement or opinion of counsel may be
based, insofar as it relates to factual matters or information with respect
to which is in the possession of the Company, upon the certificate,
statement or opinion of or representations by an officer or officers of the
Company, unless such counsel knows that the certificate, statement or
opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous,
or in the exercise of reasonable care should know that the same are
erroneous.
Any certificate, statement or opinion of an officer of the
Company or of counsel may be based, insofar as it relates to accounting
matters, upon a certificate or opinion of or representations by an
accountant or firm of accountants unless such officer or counsel, as the
case may be, knows that the certificate or opinion or representations with
respect to the accounting matters upon which his certificate, statement or
opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous. Any certificate
or opinion of any independent firm of public accountants filed with the
Trustee shall contain a statement that such firm is independent.
Section 15.06. Payments due on Saturdays, Sundays or holidays.
In any case where the date of payment of interest on or principal of the
Securities or the date fixed for redemption of any Security or the making
of any sinking fund payment shall not be a business day then payment of
interest or principal (and premium, if any) 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 date of payment or the date fixed for redemption,
and no interest shall accrue for the period after such date.
Section 15.07. Provisions required by Trust Indenture Act of
1939, as amended, to control. If and to the extent that any provision of
this Indenture limits, qualifies or conflicts with another provision
included in this Indenture which is required to be included in this
Indenture by any of Sections 310 to 317, inclusive, of the Trust Indenture
Act of 1939, as amended, such required provision shall control.
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Section 15.08. Provisions of the Indenture and Securities for
the sole benefit of the parties and the securityholders. Nothing in this
Indenture or in the Securities, expressed or implied, shall give or be
construed to give any person, firm or corporation, other than the parties
hereto and the holders of the Securities, any legal or equitable right,
remedy or claim under or in respect of this Indenture, or under any
covenant, condition or provision herein contained, all its covenants,
conditions and provisions being for the sole benefit of the parties hereto
and the holders of the Securities.
Section 15.09. Indenture may be executed in counterparts;
acceptance by Trustee. This Indenture may be executed in any number of
counterparts, each of which shall be an original; but such counterparts
shall together constitute but one and the same instrument. U.S. Trust
Company of California, N.A., the party of the second part, hereby accepts
the trusts in this Indenture declared and provided, upon the terms and
conditions hereinabove set forth.
Section 15.10. Article and Section headings. The Article and
Section references herein and in the Table of Contents are for convenience
only and shall not affect the construction hereof.
Section 15.11. Action by Executive Committee of Board of
Directors. Whenever by the terms of this Indenture any action is permitted
or required to be taken by the Board of Directors of the Company, such
action shall be deemed to have been taken by the Board of Directors of the
Company if such action is taken by the Executive Committee thereof if such
Committee is duly authorized so to act under applicable law and the
Company's Articles of Incorporation and Bylaws.
Section 15.12. 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 15.13. Maximum lawful rate. It is the intention of
the Company to conform strictly to usury laws now or hereafter in effect
under applicable law, and in no event shall the Company be required to pay,
or any securityholder of any Securities of any series be entitled to
receive, interest on the Securities at a rate in excess of the highest
lawful
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rate permitted by applicable law. To the extent permitted by applicable
law, in determining whether or not the interest paid or payable, under any
specific contingency, exceeds the highest lawful rate permitted by
applicable law, (a) any nonprincipal payment shall be characterized as an
expense, fee or premium rather than as interest, (b) any voluntary
prepayment and the effect thereof shall be excluded, and (c) the total
amount of interest shall be spread throughout the entire contemplated term
of the Securities of a series; provided that if any of the Securities of
any series are paid prior to their maturity, and if the interest paid on
any Securities of such series to a securityholder for the actual period
such Security was outstanding exceeds the highest lawful rate permitted by
applicable law, any excess shall be repaid to the Company; further
provided, however, that the Company shall not take any action pursuant to
the voluntary redemption provisions of Section 4.01 which results, or may
result, in the requirement for any such repayment.
The Company shall be solely responsible for the calculation of
whether interest paid or payable exceeds the highest lawful rate permitted
by applicable law; and the Trustee shall bear no responsibility for any
such calculation or payments made in excess of such rate.
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IN WITNESS WHEREOF, Jones Intercable, Inc., has caused this
Indenture to be signed and acknowledged by its Chairman of the Board,
President and Chief Executive Officer or one of its Vice Presidents and
U.S. Trust Company of California, N.A. has caused this Indenture to be
signed and acknowledged by one of its officers, all as of the date and year
first written above.
JONES INTERCABLE, INC.
By: /s/ ELIZABETH M. STEELE
Vice President
U.S. TRUST COMPANY OF CALIFORNIA,
N.A.
By: /s/ SANDEE PARKS
Authorized Signatory
<PAGE> 1
________________________________________________________________________________
JONES INTERCABLE, INC.
and
U.S. TRUST COMPANY OF CALIFORNIA, N.A., Trustee
_____________________________
First Supplemental Indenture
Dated as of March 23, 1995
______________________________
9-5/8% Senior Notes Due 2002
________________________________________________________________________________
<PAGE> 2
FIRST SUPPLEMENTAL INDENTURE, dated as of March 23, 1995
(the "First Supplemental Indenture"), to the Indenture, dated
as of March 23, 1995 (the "Indenture"), between JONES
INTERCABLE, INC., a corporation duly organized and existing
under the laws of the State of Colorado (the "Company"), having
its principal office at 9697 E. Mineral Avenue, Englewood,
Colorado 80112, and U.S. TRUST COMPANY OF CALIFORNIA, N.A., a
national banking association organized and existing under and
by virtue of the laws of the United States of America (the
"Trustee").
RECITALS OF THE COMPANY
WHEREAS, the Company has duly authorized the
execution and delivery of the Indenture to provide for the
issuance from time to time of one or more series of its senior
debt securities (the "Securities") to be issued in one or more
series as in the Indenture provided;
WHEREAS, the Company desires and has requested the
Trustee to join it in the execution and delivery of this First
Supplemental Indenture in order to establish and provide for
the issuance by the Company of a series of Securities
designated as its 9-5/8% Senior Notes Due 2002 in the aggregate
principal amount of $200,000,000, substantially in the form
attached hereto as Exhibit A (the "9-5/8% Senior Notes"), on
the terms set forth herein.
WHEREAS, Section 11.01 of the Indenture provides that
a supplemental indenture may be entered into by the Company and
the Trustee without the consent of any holder of any Securities
for such purpose provided certain conditions are met;
WHEREAS, the conditions set forth in the Indenture
for the execution and delivery of this First Supplemental
Indenture have been complied with; and
WHEREAS, all things necessary to make this First
Supplemental Indenture a valid agreement of the Company and the
Trustee, in accordance with its terms, and a valid amendment
of, and supplement to, the Indenture have been done;
NOW THEREFORE:
In consideration of the premises and the purchase and
acceptance of the 9-5/8% Senior Notes by the holders thereof
the Company mutually covenants and agrees with the Trustee, for
the equal and proportionate benefit of all holders of the
9-5/8% Senior Notes, that the Indenture is supplemented and
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amended, to the extent and for the purposes expressed herein, as follows:
PARAGRAPH A. SCOPE OF THIS FIRST
SUPPLEMENTAL INDENTURE
The changes, modifications and supplements to the Indenture
effected by this First Supplemental Indenture in Paragraphs B and C hereof
shall only be applicable with respect to, and govern the terms of, the
9-5/8% Senior Notes issued by the Company, which shall be limited in
aggregate principal amount to $200,000,000, except as provided in
Section 2.01(2) of the Indenture, and shall not apply to any other
Securities which may be issued under the Indenture unless a supplemental
indenture with respect to such other Securities specifically incorporates
such changes, modifications and supplements.
PARAGRAPH B. ADDITIONAL PROVISIONS
B1. ADDITIONAL DEFINITIONS - Each of the following
definitions, which constitute part of this First Supplemental Indenture,
shall be inserted in proper alphabetical order in Article 1:
Affiliate: The term "Affiliate" of any specified Person shall
mean 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" (including, with correlative
meanings, the terms "controlled by" and "under common control with"), when
used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management
or policies of such Person, whether through the ownership of voting
securities or by agreement or otherwise.
Annualized Pro Forma Operating Cash Flow: The term "Annualized
Pro Forma Operating Cash Flow" shall mean Pro Forma Operating Cash Flow for
the latest fiscal quarter ended prior to the date as of which the
Annualized Pro Forma Operating Cash Flow is being determined multiplied by
four.
Asset Sale: The term "Asset Sale" shall mean the sale,
transfer or other disposition (other than to the Company or any of its
Subsidiaries) in any single transaction or series of related transactions
of (a) any Capital Stock of any Subsidiary, (b) all or substantially all of
the assets of the
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Company or any Subsidiary or (c) all or substantially all of the assets of
a division, line of business, cable television system, or comparable
business segment of the Company or any Subsidiary.
Capitalized Lease Obligation: The term "Capitalized Lease
Obligation" shall mean, as applied to any Person, any lease of any property
(whether real, personal, or mixed) by that Person as lessee which, in
conformity with GAAP, is required to be accounted for as a capital lease on
the balance sheet of that Person.
Cash Flow Available for Interest Expense: The term "Cash Flow
Available for Interest Expense" shall mean, for any Person, for any period,
(A) the sum of the amount for such period of (i) Net Income, (ii) Interest
Expense, (iii) provisions for taxes based on income (excluding taxes
related to gains and losses excluded from the definition of Net Income),
(iv) depreciation expense, (v) amortization expense, and (vi) any other
non-cash items reducing the Net Income of such Person for such period,
minus (B) all non-cash items increasing Net Income of such Person, all as
determined on a consolidated basis in accordance with GAAP; provided that
if, during such period, such Person shall have made any Asset Sale, Cash
Flow Available for Interest Expense of such Person for such period shall be
reduced by an amount equal to the Cash Flow Available for Interest Expense
(if positive) directly attributable to the assets which are the subject of
such Asset Sale for the period or increased by an amount equal to the Cash
Flow Available for Interest Expense (if negative) directly attributable
thereto for such period.
Currency Agreement: The term "Currency Agreement" shall mean
any foreign exchange contract, currency swap agreement or other similar
agreement or arrangement designed to protect against fluctuations in
currency values.
Debt: The term "Debt" of any Person shall mean (without
duplication) any indebtedness, contingent or otherwise, in respect of
borrowed money (whether or not the recourse of the lender is to the whole
of the assets of such Person or only to a portion thereof), or evidenced by
bonds, notes, debentures or similar instruments or representing the balance
deferred and unpaid of the purchase price of any property (except any such
balance that constitutes a trade payable or an accrued liability arising in
the ordinary course of business that is not overdue by more than 120 days
or that
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is being contested in good faith), if and to the extent any of the
foregoing indebtedness would appear as a liability upon a balance sheet of
the Company in accordance with GAAP.
9-5/8% Senior Notes: The term 9-5/8% Senior Notes shall mean
the Company's 9-5/8% Senior Notes Due 2002 originally issued in the
aggregate principal amount of $200,000,000 pursuant to this First
Supplemental Indenture.
GAAP: The term "GAAP" shall mean generally accepted accounting
principles set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants
and statements and pronouncements of the Financial Accounting Standards
Board or in such other statements by such other entity as may be approved
by a significant segment of the accounting profession as in effect on the
date hereof.
incurrence: The term "incurrence" shall have the meaning
assigned to such term in Section 5.09 hereof.
Indebtedness: The term "Indebtedness" of any Person shall mean
the Debt of such Person and shall also include, to the extent not otherwise
included, any Capitalized Lease Obligation, the maximum fixed repurchase
price of any Redeemable Stock, the aggregate liquidation preference of the
issued and outstanding shares of preferred stock of any Subsidiary,
indebtedness secured by a Lien to which the property or assets owned or
held by such Person are subject (whether or not the obligations secured
thereby shall have been assumed), guarantees of items that would constitute
Indebtedness under this definition (whether or not such items would appear
upon the balance sheet of such Person), letters of credit and letter of
credit reimbursement obligations (whether or not such items would appear on
such balance sheet), and obligations in respect of Currency Agreements and
Interest Swap Obligations, and any renewal, extension, refunding or
amendment of any of the foregoing. For purposes of the preceding sentence,
the maximum fixed repurchase price shall be calculated in accordance with
the terms of such Redeemable Stock as if such Redeemable Stock were
repurchased on any date on which Indebtedness shall be required to be
determined pursuant to this Indenture, and if such price is based upon or
measured by the fair market value of such Redeemable Stock (or any equity
security for which it may be exchanged or converted), such fair market
value shall be determined in good faith by the Board of Directors. The
amount of Indebtedness of
<PAGE> 6
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any Person at any date shall be the outstanding balance at such date of all
unconditional obligations as described above and the maximum liability of
any such contingent obligations at such date.
Interest Expense: The term "Interest Expense" of any Person
shall mean, for any period, the aggregate amount of (i) interest in respect
of Indebtedness of such Person (excluding interest attributable to cable
television systems held for resale and including amortization of original
issue discount on any such Indebtedness and the interest portion of any
deferred payment obligation, calculated in accordance with the effective
interest method of accounting, all commissions, discounts and other fees
and charges owed with respect to letters of credit and bankers' acceptance
financing and the net costs associated with Interest Swap Obligations and
Currency Agreements), and (ii) all but the principal component of rentals
in respect of Capitalized Lease Obligations, paid, accrued or scheduled to
be paid or accrued by such Person during such period.
Interest Swap Obligations: The term "Interest Swap
Obligations" shall mean the obligations of any Person pursuant to any
arrangement with any other Person whereby, directly or indirectly, such
Person is entitled to receive from time to time periodic payments
calculated by applying either a floating or a fixed rate of interest on a
stated notional amount in exchange for periodic payments made by such
Person calculated by applying a fixed or a floating rate of interest on the
same notional amount.
Lien: The term "Lien" shall mean any lien, security interest,
charge or encumbrance of any kind (including any conditional sale or other
title retention agreement, any lease in the nature thereof, and any
agreement to give any security interest).
Maturity Date: The term "Maturity Date" shall mean the earlier
to occur of March 15, 2002 and the date upon which the 9-5/8% Senior Notes
shall be declared due and payable pursuant to the terms of Section 7.01
Net Income: The term "Net Income" of any Person shall mean the
net income (loss) of such Person, determined in accordance with GAAP,
excluding, however, (i) any gain or loss realized upon an Asset Sale
(including, without limitation, dispositions pursuant to sale and leaseback
transactions) of
<PAGE> 7
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such Person not in the ordinary course of business, (ii) the amount of any
non-recurring distribution from any Affiliated Partnership and
(iii) extraordinary gains and losses.
Pro Forma Operating Cash Flow: The term "Pro Forma Operating
Cash Flow" shall mean, for any period, (A) the sum of the amount for such
period of (i) Net Income, (ii) Interest Expense, (iii) provisions for taxes
based on income (excluding taxes related to gains and losses excluded from
the definition of Net Income), (iv) depreciation expense, (v) amortization
expense, (vi) any other non-cash items reducing the Net Income of such
Person for such period, minus (B) all non-cash items increasing Net Income
of such Person for such period; all as determined on a consolidated basis
for the Company and its Subsidiaries in accordance with GAAP after giving
effect to the following: (i) if, during such period, the Company or any
Subsidiary shall have any cable television systems held for resale, to the
extent not otherwise included, Pro Forma Operating Cash Flow of the Company
for such period shall be increased by an amount equal to the Pro Forma
Operating Cash Flow (if positive) of such cable television system held for
resale for such period or increased by an amount equal to the Pro Forma
Operating Cash Flow (if negative) directly attributable thereto for such
period; (ii) if, during such period, the Company or any of its Subsidiaries
shall have made any Asset Sale, Pro Forma Operating Cash Flow of the
Company for such period shall be reduced by an amount equal to the Pro
Forma Operating Cash Flow (if positive) directly attributable to the assets
which are the subject of such Asset Sale for the period or decreased by an
amount equal to Pro Forma Operating Cash Flow (if negative) directly
attributable thereto for such period; and (iii) if, during such period,
Indebtedness is incurred by the Company or any of its Subsidiaries for or
in connection with the acquisition of any Person or business which
immediately after acquisition is a Subsidiary or whose assets are held
directly by the Company or a Subsidiary, Pro Forma Operating Cash Flow
shall be computed so as to give pro forma effect to the acquisition of such
Person or business as if such acquisition had occurred as of the first day
of such period.
Redeemable Stock: The term "Redeemable Stock" shall mean any
Capital Stock which, by its terms (or by the terms of any security into
which it is convertible or for which it is exchangeable), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the
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holder thereof, in whole or in part, on or prior to the Maturity Date.
Restricted Payment: The term "Restricted Payment" shall mean,
with respect to any Person, (i) the declaration or payment of any dividend
on, or the making of any distribution to the holders (as such) of, any
shares of its Capital Stock (other than (A) dividends or distributions
payable in Capital Stock (other than Redeemable Stock) of the Company or
(B) dividends or distributions from a Subsidiary to any wholly-owned
Subsidiary or to the Company); or (ii) the direct or indirect purchase,
redemption or other acquisition or retirement value of any Capital Stock of
such Person; or (iii) any direct or indirect payment to redeem, repurchase,
defease or otherwise acquire or retire for value, prior to any scheduled
maturity, scheduled repayment or scheduled sinking fund payment, any
Indebtedness of the Company that (a) is subordinate in right of payment to
the 9-5/8% Senior Notes and (b) has a scheduled maturity subsequent to the
Maturity Date of the 9-5/8% Senior Notes.
B2. ADDITIONAL SECTIONS - Each of the following provisions,
which constitute part of this First Supplemental Indenture, is numbered to
conform with the format of the Indenture:
SECTION 4.09. Redemption.
No 9-5/8% Senior Notes may be redeemed by the Company prior to
the Maturity Date.
SECTION 5.06. Limitation on Restricted Payments.
The Company shall not, and shall not permit any Subsidiary to,
make any Restricted Payment if at the time of making such Restricted
Payment:
(i) an Event of Default shall have occurred and be
continuing, or shall occur as a consequence thereof, or
(ii) if upon giving effect to such payment the aggregate
amount expended for all such Restricted Payments subsequent to February 29,
1992 shall exceed the sum of (a) the excess of (x) the aggregate of Cash
Flow Available for Interest Expense of the Company and its Subsidiaries, on
a consolidated basis, accrued during all fiscal quarters ended subsequent
to February 29, 1992 over (y) the product of (1) 1.2 and (2) the
<PAGE> 9
-8-
aggregate of Interest Expense of the Company and its Subsidiaries, on a
consolidated basis, accrued during all fiscal quarters ended subsequent to
February 29, 1992, (b) the net proceeds received by the Company from the
issuance or sale, after February 29, 1992, of Capital Stock of the Company
(other than Redeemable Stock) and of any convertible securities which have
been converted into Capital Stock (other than Redeemable Stock) and
(c) $15,000,000.
The foregoing provisions will not prohibit (i) the payment of
any dividend within 60 days after the date of declaration when the payment
would have complied with the dividend restriction set forth above on the
date of declaration; (ii) the retirement of any shares of the Company's
Capital Stock in exchange for, or out of the net proceeds of the
substantially concurrent sale (other than to a Subsidiary of the Company)
of, other shares of the Company's Capital Stock (other than Redeemable
Stock); and (iii) the redemption, repurchase or retirement of any
Indebtedness which is subordinated to the 9-5/8% Senior Notes with the
proceeds of, or in exchange for, (a) any Indebtedness of the Company which
(x) is subordinate in right of payment to the 9-5/8% Senior Notes and
(y) has a scheduled final maturity subsequent to the Maturity Date of the
9-5/8% Senior Notes, or (b) any shares of the Company's Capital Stock other
than Redeemable Stock. Payments pursuant to clause (i) of the preceding
sentence shall be included, and payments pursuant to clauses (ii) and (iii)
of such sentence shall be excluded in calculating the aggregate amount of
Restricted Payments pursuant to the first paragraph of this Section 5.06;
provided in the case of clauses (ii) and (iii)(b) that the net proceeds
from the sale of Capital Stock so applied to retire, repurchase or redeem
Capital Stock or subordinated Indebtedness are excluded in calculating
amounts under clause (ii)(b) of the first paragraph of this Section 5.06.
SECTION 5.07. Limitation On Transactions with Affiliates.
The Company shall not, and shall not permit any Subsidiary to,
engage in any single transaction or series of related transactions having a
value in excess of $10,000,000 with an Affiliate of the Company (other than
a Subsidiary), or any director, officer or employee of the Company or any
Subsidiary, except for (i) any payment for goods or services purchased in
the ordinary course of business, (ii) temporary loans or advances to any
Affiliated Partnership on a basis consistent with past practice,
(iii) allocation of corporate overhead to Affiliates of the Company and to
the Company and
<PAGE> 10
-9-
its Subsidiaries on a basis which is fair and reasonable, and (iv) the
making of any payment pursuant to any agreement or arrangement with any
Affiliate entered into prior to the date of this Indenture.
Notwithstanding the foregoing, such provision shall not prohibit any such
transaction the terms of which, taken as a whole, are determined by the
Board of Directors of the Company to be fair and in the best interests of
the Company or any Subsidiary.
SECTION 5.09. Limitation on Additional Indebtedness.
The Company shall not, and shall not permit any Subsidiary to,
directly or indirectly, create, incur, issue, assume, or become liable for,
contingently or otherwise (collectively, an "incurrence"), any Indebtedness
(other than the 9-5/8% Senior Notes) unless, after giving effect to such
incurrence on a pro forma basis, Indebtedness of the Company and its
Subsidiaries, on a consolidated basis, shall not be more than nine times
Annualized Pro Forma Operating Cash Flow for the latest fiscal quarter
preceding such incurrence for which financial statements are available.
Notwithstanding the above, neither the Company nor any Subsidiary shall be
prohibited from incurring (i) Indebtedness incurred in connection with
Currency Agreements or Interest Swap Obligations, (ii) Indebtedness
outstanding on the date of this Indenture, (iii) letters of credit and
letter of credit reimbursement obligations that support performance
obligations not to exceed $15,000,000 in the aggregate outstanding at any
time and (iv) Indebtedness resulting from the extension, refunding or
renewal of any Indebtedness existing prior to such extension, renewal or
refunding which does not result in an increase in the principal amount of
such existing Indebtedness then outstanding or, in the case of existing
Indebtedness which matures subsequent to the Maturity Date, does not result
in the maturity of such Indebtedness prior to the Maturity Date of the
9-5/8% Senior Notes or, if the existing indebtedness is subordinated in
right of payment to the 9-5/8% Senior Notes, the Indebtedness resulting
from such extension , renewal or refunding is also subordinated in right of
payment to the 9-5/8% Senior Notes.
SECTION 7.01. Events of Default.
Section 7.01 of the Indenture is amended by deleting subclause
(f) in its entirety and substituting in lieu thereof the following:
<PAGE> 11
-10-
(f) default in the payment at final maturity of principal, or
premium, if any, aggregating $5,000,000 or more with respect to any
Indebtedness of the Company or any Subsidiary or the acceleration of any
such Indebtedness, which default shall not be cured or waived, or which
acceleration shall not be rescinded or annulled; for purposes of this
Section 7.01(f), "final maturity" shall mean, in the case of Indebtedness
which is payable in installments, the date on which the last installment of
such Indebtedness is due or the date on which such Indebtedness is due as a
result of the acceleration thereof; and
(g) any final judgment or judgments for the payment of money
in excess of $5,000,000 shall be rendered against the Company or any
Subsidiary and shall not be discharged for any period of 60 consecutive
days during which a stay of enforcement shall not be in effect.
SECTION 12.01. Company may Consolidate, etc. Only
on Certain Terms.
Section 12.01 is amended by (i) deleting the word "and" at the
end of subclause b, (ii) deleting the period at the end of subclause c and
substituting in lieu thereof a semi-colon followed by the word "and" and
(iii) adding the following subclause at the end thereof, to read in its
entirety as follows:
(d) immediately after giving effect to such transaction on a pro forma
basis, the consolidated Indebtedness of the Person formed by or surviving
any such consolidation or merger, or to which such sale, assignment,
transfer, lease or conveyance or disposition shall be made, shall not be
more than nine times Annualized Pro Forma Operating Cash Flow for the
latest fiscal quarter preceding such transaction for which financial
statements are available.
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed all as of the day and year first
above written.
JONES INTERCABLE, INC.
By: /s/ ELIZABETH M. STEELE
Title: Vice President
<PAGE> 12
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U.S. TRUST COMPANY OF CALIFORNIA,
N.A.
By: /s/ SANDEE PARKS
Title: Vice President
<PAGE> 13
A-1
EXHIBIT A
[Form of Face of Note]
No. $
JONES INTERCABLE, INC.
9-5/8% SENIOR NOTE DUE 2002
Jones Intercable, Inc., a corporation duly organized and
existing under the laws of the State of Colorado (together with any
successor corporation under the Indenture hereinafter referred to, the
"Company"), for value received, hereby promises to pay to , or
registered assigns, the principal sum of Dollars, on March 15,
2002.
Interest Payment Dates: March 15 and September 15, commencing
on September 15, 1995.
Record Dates: March 1 and September 1.
This Note is continued on the reverse hereof and the additional
provisions there set forth shall for all purposes have the same effect as
if set forth at this place.
This Note shall not be valid or become obligatory for any
purpose until the certificate of authentication hereto shall have been
signed by the Trustee under the Indenture.
IN WITNESS WHEREOF, Jones Intercable, Inc. has caused this Note
to be signed manually or by facsimile by its duly authorized officers and a
facsimile of its corporate seal to be affixed hereto or imprinted hereon.
Dated: JONES INTERCABLE, INC.
By ___________________________
[Corporate Seal]
Attest:
________________________ ___________________________
Secretary Chairman of the Board
<PAGE> 14
A-2
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 9-5/8% Senior Notes Due 2002 referred to in
the Indenture dated as of March 23, 1995, as supplemented by the First
Supplemental Indenture, dated as of March 23, 1995, between Jones
Intercable, Inc. and U.S. Trust Company of California, N.A., as Trustee.
U.S. TRUST COMPANY OF
CALIFORNIA, N.A.
By ___________________________
Authorized Signatory
Authentication Date:
<PAGE> 15
A-3
[Form of Reverse of Note]
JONES INTERCABLE, INC.
9-5/8% SENIOR NOTE DUE 2002
1. Interest and Principal Payments. JONES INTERCABLE, INC.
(together with any successor corporation under the Indenture hereinafter
referred to, the "Company") promises to pay interest on the principal
amount of this 9-5/8% Senior Note Due 2002 (this "Note") at a rate equal to
9-5/8% per annum. The Company will pay interest semi-annually in arrears
on each March 15 and September 15 (an "Interest Payment Date") of each year
commencing September 15, 1995 to the holder of record of this Note at the
close of business on the preceding March 1 and September 1, respectively.
Interest on this Note will accrue from the most recent date as to which
interest has been paid or, if no interest has been paid, from March 23,
1995. Interest will be computed on the basis of a 360-day year of twelve
30-day months.
The Company will pay the principal amount of this Note on
March 15, 2002. The Company shall pay interest on overdue principal at the
rate of 9-5/8% per annum and interest on overdue installments of interest,
to the extent lawful, at the same rate.
2. Method of Payment. The Company will pay the interest on
this Note provided for in paragraph 1 above (except defaulted interest) to
the person who is the registered holder of this Note (also referred to as
the "Noteholder") at the close of business on the March 1 or September 1,
as the case may be, next preceding the Interest Payment Date. The holder
must surrender this Note to the Office of the Trustee in Los Angeles,
California, to collect principal payments. The Company will pay principal
and interest in money of the United States that at the time of payment is
legal tender for payment of public and private debts. The Company may pay
such principal and interest by its check payable in such money by mailing
an interest check to the holder's registered address. If a payment date is
not a Business Day, payment may be made on the next succeeding Business
Day, and no interest shall accrue for the intervening period.
<PAGE> 16
A-4
3. Office or Agency of Company. The principal office of the
Trustee in Los Angeles, California, shall be the office or agency of the
Company where Notes may be presented for registration of transfer, where
notices and demands with respect to the Notes and the Indenture may be
served and where the Notes may be presented for payment, unless the Company
shall maintain some other office or agency for such purpose and shall give
the Trustee written notice thereof. In case the Company shall fail to
maintain such other office or agency, presentations may be made and notices
and demands may be served at the principal office of the Trustee.
4. Indenture. The Company issued the Notes under an
Indenture dated as of March 23, 1995, as supplemented by the First
Supplemental Indenture, dated as of March 23, 1995 (as supplemented, the
"Indenture"), between the Company and the Trustee. The terms of the Notes
include those stated in the Indenture and those made part of the Indenture
by reference to the Trust Indenture Act of 1939 (15 U.S.C. {{ 77aaa-77bbbb)
as in effect on the date of the Indenture. The Notes are subject to all
such terms, and holders of Notes are referred to the Indenture and such Act
for a statement of such terms. The Notes are general obligations of the
Company limited to 200,000,000 in aggregate principal amount, except for
Notes issued in substitution for exchanged, destroyed, lost or stolen
Notes. Capitalized terms used in this Note and not defined in this Note
shall have the respective meanings set forth in the Indenture.
5. Redemption. The Notes are not redeemable by the Company
prior to the maturity of the Notes. The Notes are not subject to any
mandatory sinking fund or mandatory redemption.
6. Satisfaction and Discharge of Indenture. Subject to
certain conditions set forth in the Indenture, the Company may, by the
deposit of funds with the Trustee, discharge its obligations under the
Indenture with respect to the Notes.
7. Denominations, Transfer, Exchange. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and Notes may
be exchanged as provided in the Indenture. The officer or agent of the
Company referred to in Section 3 hereof may require a holder, among other
things, to furnish appropriate endorsements and transfer documents and to
<PAGE> 17
A-5
pay any taxes and fees required by law or permitted by the Indenture.
8. Persons Deemed Owners. The Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in whose name this
Note is registered upon the books maintained at the office or agency of the
Company for the registration of Notes as the owner for all purposes.
9. Amendments and Waivers. The Company and the trustee,
with the consent of the holders of not less than a majority in aggregate
principal amount of the Notes at the time outstanding, may execute
supplemental indentures (which shall comply with the provisions of the
Trust Indenture Act of 1939, as amended, as then in effect) for the purpose
of adding, changing or eliminating any of the provisions of the Indenture
or of any supplemental indenture or modifying in any manner the rights of
the holders of the Notes; provided, however, that no such supplemental
indenture may (i) extend the stated maturity of the Notes, reduce the rate
or extend the time of payment of interest thereon, reduce the principal
amount thereof or impair the right to institute suit for the enforcement of
any such payment on or after the stated maturity thereof (or, in the case
of redemption, on or after the redemption date), without the consent of
each holder of the Notes, (ii) reduce the aforesaid percentage of Notes,
the consent of the holders of which is required for any such supplemental
indenture, without the consent of each holder of the Notes then
outstanding, or (iii) modify any of the provisions concerning modification
of the Indenture except to increase any such percentage or to provide that
certain other provisions of the Indenture cannot be modified or waived
without the consent of each holder of the Notes.
10. Events of Default and Remedies. Events of Default under
the Indenture include the following: a default in payment of principal of,
or premium, if any, on the Notes at maturity; a default in payment of
interest on the Notes, and continuance of such default for a period of 30
days; a failure by the Company for 60 days after notice in the manner
prescribed in the Indenture to perform any other of the covenants or
agreements in the Indenture; certain events of bankruptcy, insolvency or
reorganization of the Company or any Significant Subsidiary; default in the
payment at the final maturity of principal or premium, if any, aggregating
$5,000,000 or more with respect to other Indebtedness of the Company or any
Subsidiary or the acceleration of any such
<PAGE> 18
A-6
Indebtedness which default shall not be cured or waived, or which
acceleration shall not be rescinded or annulled; or a rendering of a final
judgment in excess of $5,000,000 against the Company or any Subsidiary that
is not discharged for any period of 60 consecutive days during which a stay
of enforcement shall not be in effect. Subject to certain limitations in
the Indenture, if an Event of Default occurs and is continuing, the Trustee
or the holders of at least 25% of the aggregate principal amount of the
Notes then outstanding may declare the principal amount of the Notes to be
due and payable immediately. The Indenture provides that such declaration
in certain events may be annulled by the holders of a majority in aggregate
principal amount of the Notes then outstanding. Noteholders may not
enforce the Indenture or the Notes except as provided in the Indenture.
The Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Notes. Subject to certain limitations, holders of a
majority in principal amount of the Notes then outstanding may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold
from Noteholders notice of any continuing default (except a default in
payment of principal, premium, if any, or interest) if it determines that
withholding notice is in their interest. The Company must furnish annual
compliance certificates to the Trustee. The above description of Events of
Default and remedies is qualified by reference and is subject in its
entirety to the more complete description thereof contained in the
Indenture.
11. Trustee Dealings with Company. The Trustee under the
Indenture, in its individual or any other capacity, may engage or be
interested in any financial or other transactions with the Company or any
Subsidiary or Affiliate, and may buy, own, hold and sell any Notes or other
securities of the Company or its Subsidiaries and Affiliates, make loans to
and maintain any and all other general banking and business relations with
the Company or its Subsidiaries and Affiliates, and may otherwise deal with
the Company or its Subsidiaries and Affiliates, as if it were not the
Trustee.
12. No Recourse Against Others. No recourse shall be had for
the payment of the principal of or the interest on this Note, or for any
claim based hereon, or otherwise in respect hereof, or based on or in
respect of the Indenture or any indenture supplemental thereto, against any
incorporator, shareholder, officer, director or employee, as such, past,
present or future, of the Company or of any successor corporation, whether
by virtue of any constitution, statute or
<PAGE> 19
A-7
rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such liability being, by the acceptance hereof and as part
of the consideration for the issue hereof, expressly waived and released.
13. Authentication. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.
14. Unclaimed Money. If money for the payment of principal
of or interest on the Notes remains unclaimed for two years after the date
upon which such payment shall have become due, the Trustee or any paying
agent will pay the money back to the Company at its request. After such
payment, holders entitled to any portion of such money must look solely to
the Company for payment thereof.
15. Definitions and Abbreviations. All terms used in this
Note which are defined in the Indenture shall have the meanings assigned to
them in the Indenture. Customary abbreviations may be used in the name of
a Noteholder or an assignee such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A
(= Uniform Gifts to Minors Act).
The Company will furnish to any Noteholder upon written request
and without charge a copy of the Indenture. Requests may be made to:
Jones Intercable, Inc., 9697 E. Mineral Avenue, Englewood, Colorado 80112.
<PAGE> 20
A-8
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (We) assign and
transfer this Note to
________________________________________________________________________________
(insert assignee's soc. sec. or tax I.D. No.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(print or type assignee's name, address and zip code)
and irrevocably appoint
________________________________________________________________________________
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
Date: _____ Your Signature: __________________________________
(Sign exactly as your name
appears on the other side
of this Note.)
Signature Guarantee:____________________
