<PAGE>
As filed with the Securities and Exchange Commission on October 10, 1995
Registration No. ______________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
----------------
UNITED STATES FILTER CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 33-0266015
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
73-710 Fred Waring Drive
Palm Desert, California 92260
(619) 340-0098
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
----------------
DAMIAN C. GEORGINO
Vice President, General Counsel and Secretary
United States Filter Corporation
73-710 Fred Waring Drive
Palm Desert, California 92260
(619) 340-0098
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
With copies to:
WILLIAM J. FEIS, ESQ.
RICHARD L. PICHENY, ESQ.
Troy & Gould Professional Corporation
1801 Century Park East, Suite 1600
Los Angeles, California 90067
(310) 553-4441
Approximate date of commencement of proposed sale to public: From time to
time after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, please check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================================
Proposed Maximum Proposed Maximum
Title of Each Class of Securities Amount To Be Offering Price Aggregate Offering Amount of
To Be Registered Registered Per Security Price(1) Registration Fee
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
6% Convertible Subordinated Notes
due 2005.......................... $140,000,000 100% $140,000,000 $48,276
Common Stock ($.01 par value)(2)... 5,090,909(3) N/A N/A N/A
================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457.
(2) Represents shares initially issuable upon conversion of the Notes.
(3) Plus an indeterminate number of additional shares of Common Stock that may
be issuable upon conversion of the Notes as a result of the antidilution
provisions thereof.
----------------
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment that specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
<PAGE>
PROSPECTUS Subject to Completion, Dated October 10, 1995
UNITED STATES FILTER CORPORATION
$140,000,000
6% Convertible Subordinated Notes Due 2005
and
Shares of Common Stock
Issuable Upon Conversion Thereof
This Prospectus covers the resale from time to time by the holders (the
"Selling Securityholders") of up to $140,000,000 aggregate principal amount of
6% Convertible Subordinated Notes due 2005 (the "Notes") of United States Filter
Corporation (the "Company"). This Prospectus also covers sales by the Selling
Securityholders from time to time of shares of common stock, $.01 par value (the
"Common Stock"), of the Company into which the Notes are convertible (the
"Conversion Shares").
The Notes are convertible at the option of the holder into shares of Common
Stock of the Company, at any time at or prior to maturity, unless previously
redeemed, at a conversion price of $27.50 per share (equivalent to a conversion
rate of 36.36 shares per $1,000 principal amount of Notes), subject to
adjustment in certain events. Interest on the Notes is payable semi-annually on
March 15 and September 15 of each year, commencing on March 15, 1996.
The Notes are redeemable, in whole or in part, at the option of the Company,
at any time on or after September 23, 1998, at the redemption prices set forth
herein, plus accrued and unpaid interest to the date of redemption. The Company
is required to offer to purchase the Notes upon a Change of Control (as
defined), at 101% of the principal amount thereof, plus accrued and unpaid
interest to the date of purchase.
The Notes are unsecured general obligations of the Company, subordinated in
right of payment to all existing and future Senior Indebtedness of the Company,
and are structurally subordinated to all liabilities (including trade payables)
of the Company's subsidiaries. The Indenture does not restrict the incurrence
of Senior Indebtedness or other indebtedness by the Company or its subsidiaries.
At June 30, 1995, as adjusted to give effect to (i) the acquisitions of
Polymetrics, Inc. and Interlake Water Systems on October 2, 1995 and August 11,
1995, respectively, (ii) the exercise on September 18, 1995 of certain warrants
to purchase Common Stock and related delivery of $45 million of Subordinated
Notes due 2001 (as defined), (iii) the repurchase on September 18, 1995 of all
of the outstanding shares of the Company's Series B Convertible Preferred Stock,
and (iv) the sale on September 18, 1995 of the Notes and the use of the net
proceeds therefrom, the Company would have had approximately $11,429,000 of
Senior Indebtedness, and the Company's subsidi-aries would have had
approximately $134,672,000 of trade payables and accrued liabilities. See
"Description of Notes."
The Notes were issued by the Company on September 18, 1995 in a private
placement and were resold by the initial purchaser thereof to qualified
institutional buyers or other accredited institutional investors in transactions
exempt from registration under the Securities Act of 1933, as amended (the
"Securities Act"), and in sales outside the United States within the meaning of
Regulation S under the Securities Act.
The Selling Securityholders may offer Notes or Conversion Shares from time to
time to purchasers directly or through underwriters, dealers or agents. Such
Notes or Conversion Shares may be sold at market prices prevailing at the time
of sale or at negotiated prices. Each Selling Securityholder will be
responsible for payment of any and all commission to brokers, which will be
negotiated on an individual basis.
The Notes have been designated for trading in the Private Offerings, Resales
and Trading through Automated Linkages ("PORTAL") Market. The Common Stock is
listed on the New York Stock Exchange (the "NYSE") under the trading symbol USF.
On October 5, 1995, the last reported sale price of the Common Stock as reported
on the NYSE was $23.125 per share. The Conversion Shares have been listed on
the NYSE. For a description of certain federal income tax consequences to the
holders of the Notes, see "Certain Federal Income Tax Consequences."
The Company will not receive any of the proceeds from the sale of any Notes
or Conversion Shares by the Selling Securityholders. Expenses of preparing and
filing the registration statement to which this Prospectus relates and all post-
effective amendments will be borne by the Company. See "Plan of Distribution"
for a description of the indemnification arrangements between the Company and
the Selling Securityholders.
See "Risk Factors" on pages 3 through 6 of the Prospectus for certain
information relevant to this offering.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
The date of this Prospectus is ________, 1995.
<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (together with all
amendments and exhibits, referred to as the "Registration Statement") under
the Securities Act with respect to the Notes and Conversion Shares offered by
this Prospectus. This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the Rules and Regulations of the Commission. For further
information with respect to the Company and the securities offered hereby,
reference is made to the Registration Statement and the exhibits and schedules
thereto, all of which may be obtained from the Commission in Washington, D.C.
as described below.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files periodic reports, proxy materials and other information with
the Commission. Such reports, proxy materials and other information may be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and
at the following regional offices of the Commission: Seven World Trade Center,
New York, New York 10048 and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. Copies may also be obtained from the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. In addition, such reports, proxy materials and other
information may be inspected and copied at the New York Stock Exchange, 20
Broad Street, New York, New York 10005.
The Company will make available to any prospective purchaser of the Notes
copies of the Indenture and Registration Rights Agreement, and the reports,
proxy material or other information filed with the Commission under the
Exchange Act and such additional information reasonably requested in
connection with the consideration of an investment in the Notes. Any such
request should be directed to the General Counsel of the Company at 73-710
Fred Waring Drive, Suite 222, Palm Desert, California 92260 (telephone number:
(619) 340-0098).
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company (Commission File No. 1-10728)
with the Commission under the Exchange Act are incorporated in this Offering
Memorandum by reference: (a) the Company's Annual Report on Form 10-K for the
fiscal year ended March 31, 1995; (b) the Company's Quarterly Report on Form
10-Q for the quarter ended June 30, 1995; and (c) the Company's current
reports on Form 8-K dated April 3, 1995 (two reports on that date), May 3,
1995, May 4, 1995 (as amended on Form 8-KA on October 6, 1995), June 12, 1995,
June 27, 1995, July 13, 1995, August 11, 1995, August 30, 1995, September 7,
1995, September 18, 1995, October 2, 1995 and October 5, 1995 and all other
reports filed pursuant to Section 13(a) or 15(d) of the Exchange Act since
March 31, 1995.
Any statement contained herein or in a document incorporated or deemed to
be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus and any amendment or supplement
hereto to the extent that a statement contained herein (or in any other
subsequently filed document which also is, or is deemed to be, incorporated by
reference herein) modifies or supersedes such statement. Any such statement
so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus or any such amendment or
supplement.
On request, the Company will provide, without charge, to each person,
including any beneficial owner, to whom this Prospectus is delivered a copy of
any or all of the documents incorporated by reference (other than exhibits to
such documents that are not specifically incorporated by reference in such
documents). Requests for such copies should be directed to Dorrie B. Osborne,
Assistant Secretary and Director of Stockholder Relations, United States
Filter Corporation, 73-710 Fred Waring Drive, Palm Desert, Suite 222,
California 92260 (telephone number (619) 340-0098).
2.
<PAGE>
THE COMPANY
The Company is a leading global provider of industrial and commercial
water treatment systems and services, with an installed base of more than
90,000 systems in the United States, Europe, Latin America and the Far East.
The Company offers a single-source solution to its industrial, commercial and
municipal customers through what the Company believes to be the industry's
broadest range of cost-effective water treatment systems, services and proven
technologies. The Company capitalizes on its substantial installed base to
sell additional systems and utilizes its global network of 124 sales and
service facilities, including 12 manufacturing plants, to provide customers
with ongoing service and maintenance. In addition, the Company is a leading
international provider of service deionization ("SDI") and outsourced water
services, including operation of water purification and wastewater treatment
systems at customer sites.
The Company's principal executive offices are located at 73-710 Fred
Waring Drive, Suite 222, Palm Desert, California 92260. The Company's
telephone number is (619) 340-0098. References herein to the Company shall
mean United States Filter Corporation and its subsidiaries, unless the context
requires otherwise.
RISK FACTORS
Prospective purchasers should carefully consider the following factors
relating to the business of the Company and the Notes, together with the
information and financial data included or incorporated by reference in this
Prospectus, before purchasing Notes and Conversion Shares offered hereby.
Acquisition Strategy
In pursuit of its strategic objective of becoming the leading global
single-source provider of water treatment systems and services the Company
has, since 1991, acquired and successfully integrated more than 18 domestic
and international businesses with strong market positions and substantial
water treatment expertise. The Company's acquisition strategy entails the
potential risks inherent in assessing the value, strengths, weaknesses,
contingent or other liabilities and potential profitability of acquisition
candidates and in integrating the operations of acquired companies. Although
the Company generally has been successful in pursuing these acquisitions,
there can be no assurance that acquisition opportunities will continue to be
available, that the Company will have access to the capital required to
finance potential acquisitions, that the Company will continue to acquire
businesses or that any business acquired will be integrated successfully or
prove profitable.
The Company has made and expects it will continue to make acquisitions and
to obtain contracts in Europe, Latin America, the Far East and other areas
outside the United States. While these activities may provide important
opportunities for the Company to offer its products and services
internationally, they also entail the risks associated with conducting
business internationally, including the risk of currency fluctuations and
social, political and economic instability.
Reliance on Key Personnel
The Company's operations are dependent on the continued efforts of senior
management, in particular Richard J. Heckmann, its Chairman, Chief Executive
Officer and President. Should any of the senior managers be unable to
continue in their present roles, the Company's prospects could be adversely
affected.
Profitability of Fixed Price Contracts
A significant portion of the Company's revenues are generated under fixed
price contracts. To the extent that original cost estimates are inaccurate,
costs to complete increase, delivery schedules are delayed or progress under a
contract is otherwise impeded, revenue recognition and profitability from a
particular contract may be adversely affected. The Company routinely records
upward or downward adjustments
3.
<PAGE>
with respect to fixed price contracts due to changes in estimates of costs to
complete such contracts. There can be no assurance that future downward
adjustments will not be material.
Cyclicality of Capital Equipment Sales
The sale of capital equipment within the water treatment industry is
cyclical and influenced by various economic factors including interest rates
and general fluctuations of the business cycle. The Company's revenues from
capital equipment sales were approximately 60% of total revenues for the
fiscal year ended March 31, 1995 and 48% for the three months ended June 30,
1995. While the Company sells capital equipment to customers in diverse
industries and in domestic and international markets, cyclicality of capital
equipment sales and instability of general economic conditions could have an
adverse effect on the Company's revenues and profitability.
Potential Environmental Risks
The Company's business and products may be significantly influenced by the
constantly changing body of environmental laws and regulations, which require
that certain environmental standards be met and impose liability for the
failure to comply with such standards. While the Company endeavors at each of
its facilities to assure compliance with environmental laws and regulations,
there can be no assurance that the Company's operations or activities, or
historical operations by others at the Company's locations, will not result in
civil or criminal enforcement actions or private actions that could have a
materially adverse effect on the Company. In particular, the Company's
activities as owner and operator of a hazardous waste treatment and recovery
facility are subject to stringent laws and regulations and compliance reviews.
Failure of this facility to comply with those regulations could result in
substantial fines and the suspension or revocation of the facility's hazardous
waste permit. In addition, to some extent, the liabilities and risks imposed
by such environmental laws on the Company's customers may adversely impact
demand for certain of the Company's products or services or impose greater
liabilities and risks on the Company, which could also have an adverse effect
on the Company's competitive or financial position.
Competition
The water purification and wastewater treatment industry is fragmented and
highly competitive. The Company competes with many domestic and international
companies in its global markets. The principal methods of competition in the
markets in which the Company competes are technology, service, price, product
specifications, customized design, product knowledge and reputation, ability
to obtain sufficient performance bonds, timely delivery, the relative ease of
system operation and maintenance, and the prompt availability of replacement
parts. In the municipal contract bid process, pricing and ability to meet bid
specifications are the primary considerations. While no competitor is
considered dominant, there are competitors that are larger and have
significantly greater resources than the Company, which, among other things,
could be a competitive disadvantage to the Company in securing certain
projects.
Technological and Regulatory Change
The water purification and wastewater treatment business is characterized
by changing technology, competitively imposed process standards and regulatory
requirements, each of which influences the demand for the Company's products
and services. Changes in regulatory or industrial requirements may render
certain of the Company's purification and treatment products and processes
obsolete. Acceptance of new products may also be affected by the adoption of
new government regulations requiring stricter standards. The Company's
ability to anticipate changes in technology and regulatory standards and to
successfully develop and introduce new and enhanced products on a timely basis
will be a significant factor in the Company's ability to grow and to remain
competitive. There can be no assurance that the Company will be able to
achieve the technological advances that may be necessary for it to remain
competitive or that certain of its products will not become obsolete. In
addition, the Company is subject to the risks generally associated with new
product introductions and applications, including lack of market acceptance,
delays in development or failure of products to operate properly.
4.
<PAGE>
Shares Eligible for Future Sale
The market price of the Company's Common Stock could be adversely affected
by the availability for sale of shares held by the current stockholders of the
Company, including 7,794,001 shares outstanding or issuable upon conversion of
other securities of the Company that are currently registered under three
shelf registration statements, and 1,649,732 shares beneficially owned on
September 30, 1995 by directors and executive officers of the Company that,
after December 17, 1995, may be sold, subject, in the case of affiliates, to
the volume and manner of sale limitations of Rule 144 adopted under the
Securities Act of 1933, as amended (the "Securities Act").
Subordination
The Notes are subordinated in right of payment to all existing and future
Senior Indebtedness and are structurally subordinated to all liabilities
(including trade payables) of the Company's subsidiaries. The Indenture does
not restrict the incurrence of Senior Indebtedness or other indebtedness by
the Company or its subsidiaries. At June 30, 1995, as adjusted to give effect
to (i) the acquisitions of Polymetrics, Inc and Interlake Water Systems on
October 2, 1995 and August 11, 1995, respectively, (ii) the exercise on
September 18, 1995 of certain warrants to purchase Common Stock and related
delivery of $45 million of Subordinated Notes due 2001 (as defined), (iii) the
repurchase on September 18, 1995 of all of the outstanding shares of the
Company's Series B Convertible Preferred Stock, and (iv) the sale on September
18, 1995 of the Notes and the use of the net proceeds therefrom, the Company
would have had approximately $11.4 million of Senior Indebtedness outstanding.
By reason of such subordination of the Notes, in the event of the insolvency,
bankruptcy, liquidation, reorganization, dissolution or winding up of the
business of the Company or upon a default in payment with respect to any
indebtedness of the Company or an event of default with respect to such
indebtedness resulting in the acceleration thereof, the assets of the Company
will be available to pay the amounts due on the Notes only after all Senior
Indebtedness has been paid in full. The Notes rank pari passu in all respects
with other unsecured subordinated obligations of the Company, including the
Company's 5% Convertible Subordinated Debentures due 2000 (as defined). See
"Description of the Notes-Subordination."
The Company conducts its operations through its subsidiaries.
Accordingly, the Company's ability to meet its cash obligations is dependent
in part upon the ability of its subsidiaries to make cash distributions to the
Company. The ability of its subsidiaries to make distributions to the Company
is and will continue to be restricted by, among other limitations, applicable
provisions of the laws of national or state governments and contractual
provisions. The Indenture does not limit the ability of the Company's
subsidiaries to incur such restrictions in the future. The right of the
Company to participate in the assets of any subsidiary (and thus the ability
of holders of the Notes to benefit indirectly from such assets) are generally
subject to the prior claims of creditors, including trade creditors, of that
subsidiary except to the extent that the Company is recognized as a creditor
of such subsidiary, in which case the Company's claims would still be subject
to any security interest of other creditors of such subsidiary. The Notes,
therefore, are structurally subordinated to creditors, including trade
creditors, of subsidiaries of the Company with respect to the assets of the
subsidiaries against which such creditors have a claim. At June 30, 1995, as
adjusted to give effect to (i) the acquisitions of Polymetrics and Interlake
on October 2, 1995 and August 11, 1995, respectively, and (ii) the exercise on
September 18, 1995 of certain warrants to purchase Common Stock and related
delivery of $45 million of Subordinated Notes due 2001, the Company's
subsidiaries would have had approximately $134.7 million of trade payables and
accrued liabilities.
Absence of Existing Market for Notes
There is no established public trading market for the Notes. The Company
does not intend to list the Notes on any national securities exchange or to
seek the admission thereof to trading in the National Association of
Securities Dealers Automated Quotation system. The Company has been advised
by Donaldson, Lufkin & Jenrette Securities Corporation ("DLJ") and PaineWebber
Incorporated ("PaineWebber"), the initial purchasers of the Notes (the
"Initial Purchasers"), that DLJ and PaineWebber are making and currently
intend to continue making a market in the Notes. However, DLJ and
5.
<PAGE>
PaineWebber are not obligated to make such a market and any market-making
activities may be discontinued at any time without notice. In addition, such
market-making activity is subject to the limits imposed by the Securities Act
and the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
may be limited during the pendency of the shelf registration statement to
which this Prospectus relates. See "Description of the Notes-Registration
Rights; Liquidated Damages." Although the Notes have been designated for
trading through PORTAL, no assurance can be given that an active trading
market for the Notes will develop or, if such market develops, as to the
liquidity or sustainability of such market. If a trading market does not
develop or is not maintained, holders of the Notes may experience difficulty
in reselling the Notes or may be unable to sell them at all. If a market for
the Notes develops, any such market may be discontinued at any time. If a
public trading market develops for the Notes, future trading prices of the
Notes will depend on many factors, including, among other things, prevailing
interest rates, the Company's results of operations and the market for similar
securities. Depending on prevailing interest rates, the market for similar
securities and other factors, including the financial condition of the
Company, the Notes may trade at a discount from their principal amount.
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Three Months
Year Ended March 31, ended June 30,(1)
---------------------------- -----------------
1991 1992 1993 1994 1995 1994 1995
---- ---- ---- ---- ---- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed
Charges(2)............. -- -- 1.3x -- 3.3x 2.8x 3.4x
</TABLE>
- -------------
(1) The historical consolidated financial data from which the Ratios of
Earnings to Fixed Charges were derived for the fiscal years ended March
31, 1991 through March 31, 1994 and for the three months ended June 30,
1994 has been restated to include the accounts and operations of
Liquipure, which was merged with the Company in July 1994 and accounted
for as a pooling of interests.
(2) The ratio of earnings to fixed charges has been computed by dividing
earnings available for fixed charges (income before interest expense,
interest income and income taxes, plus fixed charges) by fixed charges.
Fixed charges consist of interest expense (including amortization of
deferred financing costs) and the portion of rental expense that is
representative of the interest factor (deemed by the Company to be one-
third). Fixed charges exceeded loss before fixed charges by $1,848,000,
$6,290,000 and $4,874,000 for the years ended March 31, 1991, 1992 and
1994, respectively.
USE OF PROCEEDS
The Selling Securityholders will receive all of the net proceeds from the
sale of the Notes and Conversion Shares offered hereby. The Company will not
receive any of the proceeds from any such sale.
6.
<PAGE>
DESCRIPTION OF THE NOTES
Set forth below is a summary of certain provisions of the Notes. The
Notes were issued pursuant to an indenture (the "Indenture") dated as of
September 18, 1995, by and between the Company and The First National Bank of
Boston, as trustee (the "Trustee"). State Street Bank and Trust Company is
the successor to The First National Bank of Boston, as Trustee. The following
summary of the Notes, the Indenture and the Registration Rights Agreement does
not purport to be complete and is subject to, and is qualified in its entirety
by, reference to all of the provisions of the Indenture and the Registration
Rights Agreement, including the definitions thereof. Copies of the Indenture
and the Registration Rights Agreement can be obtained from the Company upon
request. Capitalized terms used herein without definition have the meanings
ascribed to them in the Indenture or the Registration Rights Agreement, as
appropriate. As used in this section, "the Company" refers to United States
Filter Corporation, exclusive of its subsidiaries. Wherever particular
provisions of the Indenture are referred to in this summary, such provisions
are incorporated by reference as a part of the statements made and such
statements are qualified in their entirety by such reference.
General
The Notes are unsecured, subordinated, general obligations of the Company,
limited in aggregate principal amount to $140,000,000. The Notes are
subordinated in right of payment to all Senior Indebtedness of the Company, as
described under "Subordination" below. The Notes were issued only in fully
registered form, without coupons, in denominations of $1,000 and integral
multiples thereof.
The Notes mature on September 15, 2005. The Notes bear interest at 6% per
annum from the date of issuance or from the most recent Interest Payment Date
to which interest has been paid or provided for, payable semi-annually on
March 15 and September 15 of each year, commencing March 15, 1996, to the
persons in whose names such Notes are registered at the close of business on
March 1 or September 1 immediately preceding such Interest Payment Date.
Principal of, premium, if any, and interest on, and liquidated damages with
respect to, the Notes will be payable, the Notes will be convertible and the
Notes may be presented for registration of transfer or exchange, at the office
or agency of the Company maintained for such purpose, which office or agency
shall be maintained in the Borough of Manhattan, The City of New York.
Interest will be calculated on the basis of a 360-day year consisting of
twelve 30-day months.
At the option of the Company, payment of interest and liquidated damages
may be made by check mailed to the Holders of the Notes at the addresses set
forth upon the registry books of the Company. No service charge will be made
for any registration of transfer or exchange of Notes, but the Company may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith. Until otherwise designated by the
Company, the Company's office or agency is the corporate trust office of the
Trustee presently located at 150 Royall Street, Canton, Massachusetts 02021.
Conversion Rights
The Holder of any Notes has the right, at the Holder's option, to convert
any portion of the principal amount thereof that is an integral multiple of $
1,000 into shares of Common Stock at any time prior to the second Business Day
prior to the Stated Maturity of the Note (unless earlier redeemed or
repurchased) at the Conversion Price of $27.50 per share (equivalent to a
conversion rate of 36.36 shares per $1,000 principal amount of Notes) (subject
to adjustment as described below). The right to convert a Note called for
redemption or delivered for repurchase will terminate at the close of business
on the fifth or second Business Day, respectively, prior to the Redemption
Date or Repurchase Date for such Note, unless the Company subsequently fails
to pay the applicable Redemption Price or Repurchase Price, as the case may
be.
In the case of any Note that has been converted after any Record Date, but
on or before the next Interest Payment Date, interest the stated due date of
which is on such Interest Payment Date shall be payable on such Interest
Payment Date notwithstanding such conversion, and such interest shall be paid
7.
<PAGE>
to the Holder of such Note who is a Holder on such Record Date. Any Note so
converted must be accompanied by payment of an amount equal to the interest
payable on such Interest Payment Date on the principal amount of Notes being
surrendered for conversion. No fractional shares will be issued upon
conversion but, in lieu thereof, an appropriate amount will be paid in cash by
the Company based on the market price of Common Stock (as determined in
accordance with the Indenture) at the close of business on the day of
conversion.
The Conversion Price is subject to adjustment in certain events,
including: (a) any payment of a dividend (or other distribution) payable in
Common Stock on any class of Capital Stock of the Company, (b) any issuance to
all holders of Common Stock of rights, options or warrants entitling them to
subscribe for or purchase Common Stock at less than the then current market
price (as determined in accordance with the Indenture) of Common Stock,
provided, however, that if such options or warrants are only exercisable upon
the occurrence of certain triggering events, then the conversion price will
not be adjusted until such triggering events occur, (c) any subdivision,
combination or reclassification of Common Stock, (d) any distribution to all
holders of Common Stock of evidences of indebtedness, shares of Capital Stock
other than Common Stock, cash or other assets (including securities, but
excluding those dividends, rights, options, warrants and distributions
referred to above and excluding dividends and distributions paid exclusively
in cash), (e) any distribution consisting exclusively of cash (excluding any
cash portion of distributions referred to in (d) above, or cash distributed
upon a merger or consolidation to which the second succeeding paragraph
applies) to all holders of Common Stock in an aggregate amount that, combined
together with (i) all other such all-cash distributions made within the then
preceding 12 months in respect of which no adjustment has been made and (ii)
any cash and the fair market value of other consideration paid or payable in
respect of any tender offer by the Company or any of its subsidiaries for
Common Stock concluded within the preceding 12 months in respect of which no
adjustment has been made, exceeds 15% of the Company's market capitalization
(defined as being the product of the then current market price of the Common
Stock times the number of shares of Common Stock then outstanding) on the
record date of such distribution, and (f) the completion of a tender offer
made by the Company or any of its Subsidiaries for Common Stock that involves
an aggregate consideration that, together with (i) any cash and other
consideration payable in a tender offer by the Company or any of its
Subsidiaries for Common Stock expiring within the 12 months preceding the
expiration of such tender offer in respect of which no adjustment has been
made and (ii) the aggregate amount of any such all-cash distributions referred
to in (e) above to all holders of Common Stock within the 12 months preceding
the expiration of such tender offer in respect of which no adjustments have
been made, exceeds 15% of the Company's market capitalization on the
expiration of such tender offer. The Company reserves the right to make such
reductions in the conversion price in addition to those required in the
foregoing provisions as it considers to be advisable in order that any event
treated for Federal income tax purposes as a dividend of stock or stock rights
will not be taxable to the recipients. No adjustment of the conversion price
is required to be made until the cumulative adjustments amount to 1.0% or more
of the conversion price as last adjusted.
In the event that the Company distributes rights or warrants (other than
those referred to in (b) in the preceding paragraph) pro rata to holders of
Common Stock, so long as any such rights or warrants have not expired or been
redeemed by the Company, the Holder of any Note surrendered for conversion is
entitled to receive upon such conversion, in addition to the shares of Common
Stock issuable upon such conversion (the "Conversion Shares"), a number of
rights or warrants to be determined as follows: (i) if such conversion occurs
on or prior to the date for the distribution to the holders of rights or
warrants of separate certificates evidencing such rights or warrants (the
"Distribution Date"), the same number of rights or warrants to which a holder
of a number of shares of Common Stock equal to the number of Conversion Shares
is entitled at the time of such conversion in accordance with the terms and
provisions of and applicable to the rights or warrants, and (ii) if such
conversion occurs after such Distribution Date, the same number of rights or
warrants to which a holder of the number of shares of Common Stock into which
such Note was convertible immediately prior to such Distribution Date would
have been entitled on such Distribution Date in accordance with the terms and
provisions of and applicable to the rights or warrants. The conversion price
of the Notes is not subject to adjustment on account of any declaration,
distribution or exercise of such rights or warrants.
8.
<PAGE>
In case of any reclassification, consolidation or merger of the Company
with or into another Person or any merger of another Person with or into the
Company (with certain exceptions), or in case of any sale, transfer or
conveyance of all or substantially all of the assets of the Company (computed
on a consolidated basis), each Note then outstanding will, without the consent
of any Holder of Notes, become convertible only into the kind and amount of
securities, cash and other property receivable upon such reclassification,
consolidation, merger, sale, transfer or conveyance by a holder of the number
of shares of Common Stock into which such Note was convertible immediately
prior thereto, after giving effect to any adjustment event, who failed to
exercise any rights of election and received per share the kind and amount
received per share by a plurality of non-electing shares.
The Company will use its best efforts to cause all registrations with, and
to obtain any approvals by, any governmental authority under any Federal or
state law of the United States that may be required in connection with the
conversion of the Notes into Common Stock. If at any time during the three-
year period following September 18, 1995, a registration statement under the
Securities Act covering the shares of Common Stock issuable upon conversion of
the Notes is not effective, shares of Common Stock issued upon conversion of
the Notes ("Restricted Shares") may not be sold or otherwise transferred
except in accordance with or pursuant to an exemption from, or otherwise in a
transaction not subject to, the registration requirements of the Securities
Act and, if a registration statement under the Securities Act is not effective
at the time of a conversion, the Restricted Shares will bear a legend to that
effect. The Transfer Agent for the Common Stock is not required to accept for
registration or transfer any Restricted Shares, except upon presentation of
satisfactory evidence that these restrictions on transfer have been complied
with, all in accordance with such reasonable regulations as the Company may
from time to time agree with the Transfer Agent. Under certain circumstances,
the holders of the Notes are entitled to liquidated damages during such
period. See "Description of the Notes-Registration Rights; Liquidated
Damages."
Subordination
The Notes are general, unsecured obligations of the Company, subordinated
in right of payment to all existing and future Senior Indebtedness of the
Company and rank pari passu in all respects with other unsecured subordinated
indebtedness of the Company, including the 5% Convertible Subordinated
Debentures due 2000. The Notes are structurally subordinated in right of
payment to all liabilities (including trade payables and capitalized lease
obligations) of the Company's subsidiaries. At June 30, 1995, as adjusted to
give effect to (i) the acquisitions of Polymetrics, Inc. and Interlake Water
Systems on October 2, 1995 and August 11, 1995, respectively, (ii) the
exercise on September 18, 1995 of certain warrants to purchase Common Stock
and related delivery of $45 million of Subordinated Notes due 2001 (as
defined), (iii) the repurchase on September 18, 1995 of all of the outstanding
shares of the Company's Series B Convertible Preferred Stock, and (iv) the
sale on September 18, 1995 of the Notes and the use of the net proceeds
therefrom, the Company would have had $11,429,000 of Senior Indebtedness
outstanding. The rights of Holders are subordinated by operation of law to
all existing and future indebtedness of the Company's subsidiaries, which as
of June 30, 1995 was approximately $134,672,000 of trade payables and accrued
liabilities. The Indenture does not restrict the incurrence of Senior
Indebtedness or other indebtedness by the Company or its Subsidiaries.
The Indenture provides that no payment may be made by the Company on
account of the principal of, premium, if any, interest on, or liquidated
damages with respect to, the Notes, or to acquire any of the Notes (including
repurchases of Notes at the option of the Holder) for cash or property (other
than Junior Securities), or on account of the redemption provisions of the
Notes, (i) upon the maturity of any Senior Indebtedness of the Company by
lapse of time, acceleration (unless waived) or otherwise, unless and until all
principal of, premium, if any, and interest on such Senior Indebtedness are
first paid in full (or such payment is duly provided for), or (ii) in the
event of default in the payment of any principal of, premium, if any, or
interest on any Senior Indebtedness of the Company when it becomes due and
payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise (a "Payment Default"), unless and until such Payment
Default has been cured or waived or otherwise has ceased to exist.
9.
<PAGE>
Upon (i) the happening of an event of default (other than a Payment
Default) that permits the holders of Senior Indebtedness or their
representative immediately to accelerate its maturity and (ii) written notice
of such event of default given to the Company and the Trustee by the holders
of an aggregate of at least $20,000,000 principal amount outstanding of such
Senior Indebtedness or their representative (a "Payment Notice"), then, unless
and until such event of default has been cured or waived or otherwise has
ceased to exist, no payment (by setoff or otherwise) may be made by or on
behalf of the Company on account of the principal of, premium, if any,
interest on, or liquidated damages with respect to, the Notes, or to acquire
or repurchase any of the Notes for cash or property, or on account of the
redemption provisions of the Notes, in any such case other than payments made
with Junior Securities of the Company. Notwithstanding the foregoing, unless
(i) the Senior Indebtedness in respect of which such event of default exists
has been declared due and payable in its entirety within 179 days after the
Payment Notice is delivered as set forth above (the "Payment Blockage
Period"), and (ii) such declaration has not been rescinded or waived, at the
end of the Payment Blockage Period, the Company shall be required to pay all
sums not paid to the Holders of the Notes during the Payment Blockage Period
due to the foregoing prohibitions and to resume all other payments as and when
due on the Notes. Any number of Payment Notices may be given; provided,
however, that (i) not more than one Payment Notice shall be given within a
period of any 360 consecutive days, and (ii) no default that existed upon the
date of such Payment Notice or the commencement of such Payment Blockage
Period (whether or not such event of default is on the same issue of Senior
Indebtedness) shall be made the basis for the commencement of any other
Payment Blockage Period.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company (other than Junior Securities) shall be
received by the Trustee or the Holders at a time when such payment or
distribution is prohibited by the foregoing provisions, such payment or
distribution shall be held in trust for the benefit of the holders of Senior
Indebtedness of the Company, and shall be paid or delivered by the Trustee or
such Holders, as the case may be, to the holders of the Senior Indebtedness of
the Company remaining unpaid or unprovided for or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any of such Senior Indebtedness of the
Company may have been issued, ratably according to the aggregate amounts
remaining unpaid on account of the Senior Indebtedness of the Company held or
represented by each, for application to the payment of all Senior Indebtedness
of the Company remaining unpaid, to the extent necessary to pay or to provide
for the payment of all such Senior Indebtedness in full after giving effect to
any concurrent payment or distribution to the holders of such Senior
Indebtedness.
Upon any distribution of assets of the Company upon any dissolution,
winding up, total or partial liquidation or reorganization of the Company,
whether voluntary or involuntary, in bankruptcy, insolvency, receivership or a
similar proceeding or upon assignment for the benefit of creditors or any
marshalling of assets or liabilities, (i) the holders of all Senior
Indebtedness of the Company will first be entitled to receive payment in full
(or have such payment duly provided for) before the Holders are entitled to
receive any payment on account of the principal of, premium, if any, interest
on, and liquidated damages with respect to, the Notes (other than Junior
Securities) and (ii) any payment or distribution of assets of the Company of
any kind or character, whether in cash, property or securities (other than
Junior Securities) to which the Holders or the Trustee on behalf of the
Holders would be entitled (by setoff or otherwise), except for the
subordination provisions contained in the Indenture, will be paid by the
liquidating trustee or agent or other person making such a payment or
distribution directly to the holders of Senior Indebtedness of the Company or
their representative to the extent necessary to make payment in full of all
such Senior Indebtedness remaining unpaid, after giving effect to any
concurrent payment or distribution to the holders of such Senior Indebtedness.
No provision contained in the Indenture or the Notes affects the
obligation of the Company, which is absolute and unconditional, to pay, when
due, principal of, premium, if any, interest on, and liquidated damages with
respect, to the Notes. The subordination provisions of the Indenture and the
Notes do not prevent the occurrence of any Default or Event of Default under
the Indenture or limit the rights of the Trustee or any Holder, subject to the
two preceding previous paragraphs, to pursue any other rights or remedies with
respect to the Notes.
10.
<PAGE>
As a result of these subordination provisions, in the event of the
liquidation, bankruptcy, reorganization, insolvency, receivership or similar
proceeding or an assignment for the benefit of the creditors of the Company or
any of its Subsidiaries or a marshalling of assets or liabilities of the
Company and its Subsidiaries, Holders of the Notes may receive ratably less
than other creditors.
The Company conducts its operations through its Subsidiaries.
Accordingly, the Company's ability to meet its cash obligations is dependent
upon the ability of its Subsidiaries to make cash distributions to the
Company. The ability of its Subsidiaries to make distributions to the Company
is and will continue to be restricted by, among other limitations, applicable
provisions of the laws of national and state governments and contractual
provisions. The Indenture does not limit the ability of the Company's
subsidiaries to incur such restrictions in the future. The right of the
Company to participate in the assets of any Subsidiary (and thus the ability
of holders of the Notes to benefit indirectly from such assets) is generally
subject to the prior claims of creditors, including trade creditors, of that
Subsidiary except to the extent that the Company is recognized as a creditor
of such Subsidiary, in which case the Company's claims would still be subject
to any security interest of other creditors of such Subsidiary. The Notes,
therefore, are structurally subordinated to creditors, including trade
creditors, of Subsidiaries of the Company with respect to the assets of the
Subsidiaries against which such creditors have a claim.
Redemption at the Company's Option
The Notes are not subject to redemption prior to September 23, 1998 and
are redeemable on such date and thereafter at the option of the Company, in
whole or in part, upon not less than 30 nor more than 60 days' notice to each
Holder, at the following redemption prices (expressed as percentages of the
principal amount) if redeemed during the 12-month period commencing September
15 of the years indicated below, in each case (subject to the right of Holders
of record on a Record Date to receive interest due on an Interest Payment Date
that is on or prior to such Redemption Date) together with accrued and unpaid
interest and liquidated damages, if any, to the Redemption Date:
<TABLE>
<CAPTION>
Year............................... Percentage
----............................... ----------
<S>................................ <C>
1998............................... 103.75%
1999............................... 103.00%
2000............................... 102.25%
2001............................... 101.50%
2002............................... 100.75%
2003 and thereafter................ 100%
</TABLE>
In the case of a partial redemption, the Trustee shall select the Notes or
portions thereof for redemption on a pro rata basis, by lot or in such other
manner it deems appropriate and fair. The Notes may be redeemed in part in
multiples of $1,000 only.
The Notes will not have the benefit of any sinking fund.
Notice of any redemption will be sent, by first-class mail, at least 30
days and not more than 60 days prior to the date fixed for redemption, to the
Holder of each Note to be redeemed to such Holder's last address as then shown
upon the registry books of the Registrar. The notice of redemption must state
the Redemption Date, the Redemption Price and the amount of accrued interest
to be paid. Any notice that relates to a Note to be redeemed in part only
must state the portion of the principal amount equal to the unredeemed portion
thereof and must state that on and after the Redemption Date, upon surrender
of such Note, a new Note or Notes in principal amount equal to the unredeemed
portion thereof will be issued. On and after the Redemption Date, interest
will cease to accrue on the Notes or portions thereof called for redemption,
unless the Company defaults in its obligations with respect thereto.
11.
<PAGE>
Repurchase of Notes at the Option of the Holder Upon a Change of Control
The Indenture provides that in the event that a Change of Control (as
defined) has occurred, each Holder of Notes will have the right, at such
Holder's option, pursuant to an irrevocable and unconditional offer by the
Company (the "Repurchase Offer"), to require the Company to repurchase all or
any part of such Holder's Notes (provided, that the principal amount of such
Notes must be $1,000 or an integral multiple thereof) on the date (the
"Repurchase Date") that is no later than 40 Business Days after the occurrence
of such Change of Control at a cash price (the "Repurchase Price") equal to
101% of the principal amount thereof, together with accrued and unpaid
interest to the Repurchase Date. The Repurchase Offer shall be made within 15
Business Days following a Change of Control and shall remain open for 20
Business Days following its commencement (the "Repurchase Offer Period").
Upon expiration of the Repurchase Offer Period, the Company shall purchase all
Notes tendered in response to the Repurchase Offer. If required by applicable
law, the Repurchase Date and the Repurchase Offer Period may be extended as so
required; however, if so extended, it shall nevertheless constitute an Event
of Default if the Repurchase Date does not occur within 60 Business Days of
the Change of Control.
The Indenture provides that a "Change of Control" occurs (i) upon any
merger or consolidation of the Company with or into any person or any sale,
transfer or other conveyance, whether direct or indirect, of all or
substantially all of the assets of the Company, on a consolidated basis, in
one transaction or a series of related transactions, if, immediately after
giving effect to such transaction, any "person" or "group" (as such terms are
used for purposes of Sections 13(d) and 14(d) of the Exchange Act, whether or
not applicable) is or becomes the "beneficial owner," directly or indirectly,
of more than 50% of the total voting power in the aggregate normally entitled
to vote in the election of directors, managers, or trustees, as applicable, of
the transferee or surviving entity, (ii) when any "person's or "group" (as
such terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
Act, whether or not applicable) is or becomes the "beneficial owner," directly
or indirectly, of more than 50% of the total voting power in the aggregate
normally entitled to vote in the election of directors of the Company, or
(iii) when, during any period of 12 consecutive months after the Issue Date,
individuals who at the beginning of any such 12-month period constituted the
Board of Directors of the Company (together with any new directors whose
election by such Board or whose nomination for election by the shareholders of
the Company was approved by a vote of a majority of the directors then still
in office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved), cease for any
reason to constitute a majority of the Board of Directors of the Company then
in office.
On or before the Repurchase Date, the Company will (i) accept for payment
Notes or portions thereof properly tendered pursuant to the Repurchase Offer,
(ii) deposit with the Paying Agent cash sufficient to pay the Repurchase Price
(together with accrued and unpaid interest) of all Notes so tendered and (iii)
deliver to the Trustee Notes so accepted, together with an Officers'
Certificate listing the Notes or portions thereof being purchased by the
Company. The Paying Agent will promptly mail to the Holders of Notes so
accepted payment in an amount equal to the Repurchase Price (together with
accrued and unpaid interest), and the Trustee will promptly authenticate and
mail or deliver to such Holders a new Note or Notes equal in principal amount
to any unpurchased portion of the Notes surrendered. Any Notes not so
accepted will be promptly mailed or delivered by the Company to the Holder
thereof. The Company will publicly announce the results of the Repurchase
Offer on or as soon as practicable after the Repurchase Date.
The phrase "all or substantially all" of the assets of the Company is
likely to be interpreted by reference to applicable state law at the relevant
time, and will be dependent on the facts and circumstances existing at such
time. As a result, there may be a degree of uncertainty in ascertaining
whether a sale or transfer of "all or substantially all" of the assets of the
Company has occurred. In addition, no assurances can be given that the
Company will be able to acquire the Notes tendered upon the occurrence of a
Change of Control.
For purposes of this definition, (i) the terms "person" and "group" shall
have the meaning used for purposes of Rules 13d-3 and 13d-5 of the Exchange
Act as in effect on the Issue Date, whether or not applicable; and (ii) the
term "beneficial owner" shall have the meaning used in Rules 13d-3 and 13d-5
12.
<PAGE>
under the Exchange Act as in effect on the Issue Date, whether or not
applicable, except that a "person" shall be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire,
whether such right is exercisable immediately or only after the passage of
time or upon the occurrence of certain events.
The Change of Control purchase feature of the Notes may make more
difficult or discourage a takeover of the Company, and, thus, the removal of
incumbent management. The Change of Control purchase feature resulted from
negotiations between the Company and the Initial Purchasers.
The provisions of the Indenture relating to a Change of Control may not
afford the Holders protection in the event of a highly leveraged transaction,
reorganization, restructuring, merger, spin-off or similar transaction that
may adversely affect Holders, if such transaction does not constitute a Change
of Control, as set forth above. In addition, the Company may not have
sufficient financial resources available to fulfill its obligation to
repurchase the Notes upon a Change of Control or to repurchase other debt
securities of the Company or its Subsidiaries providing similar rights to the
holders thereof.
To the extent applicable and if required by law, the Company will comply
with Section 14 of the Exchange Act and the provisions of Regulation 14E and
any other tender offer rules under the Exchange Act and any other securities
laws, rules and regulations that may then be applicable to any offer by the
Company to purchase the Notes at the option of Holders upon a Change of
Control.
The right to require the Company to repurchase Notes as a result of the
occurrence of a Change of Control could create an event of default under
Senior Indebtedness as a result of which any repurchase could, absent a
waiver, be blocked by the subordination provision of the Notes. See "-
Subordination." Failure of the Company to repurchase the Notes when required
would result in an Event of Default with respect to the Notes whether or not
such repurchase is permitted by the subordination provisions.
Rule 144A Information Requirement
The Company has agreed to furnish to the Holders or beneficial holders of
the Notes or the underlying Common Stock and prospective purchasers of the
Notes or the underlying Common Stock designated by the Holders of the Notes or
the underlying Common Stock, upon their request, the information required to
be delivered pursuant to Rule 144A(d)(4) under the Securities Act until such
time as such securities are no longer "restricted securities" within the
meaning of Rule 144 under the Securities Act.
Limitation on Merger, Sale or Consolidation
The Indenture provides that the Company may not, directly or indirectly,
consolidate with or merge with or into another person or sell, lease, convey
or transfer all or substantially all of its assets (computed on a consolidated
basis), whether in a single transaction or a series of related transactions,
to another Person or group of affiliated Persons, unless (i) either (a) in the
case of a merger or consolidation the Company is the surviving entity or (b)
the resulting, surviving or transferee entity is a corporation organized under
the laws of the United States, any state thereof or the District of Columbia
and expressly assumes by supplemental indenture all of the obligations of the
Company in connection with the Notes and the Indenture; and (ii) no Default or
Event of Default shall exist or shall occur immediately after giving effect on
a pro forma basis to such transaction.
Upon any consolidation or merger or any transfer of all or substantially
all of the assets of the Company in accordance with the foregoing, the
successor corporation formed by such consolidation or into which the Company
is merged or to which such transfer is made, shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
the Indenture with the same effect as if such successor corporation had been
named therein as the Company, and the Company will be released from its
obligations under the Indenture and the Notes, except as to any obligations
that arise from or as a result of such transaction.
13.
<PAGE>
Reports
Whether or not the Company is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, the Company shall deliver to the
Trustee and to each Holder, within 15 days after it is or would have been
required to file such with the SEC, annual and quarterly consolidated
financial statements substantially equivalent to financial statements that
would have been included in reports filed with the SEC if the Company was
subject to the requirements of Section 13 or 15(d) of the Exchange Act,
including, with respect to annual information only, a report thereon by the
Company's certified independent public accountants as such would be required
in such reports to the SEC and, in each case, together with a management's
discussion and analysis of financial condition and results of operations as
such would be so required.
Events of Default and Remedies
The Indenture defines an Event of Default as (i) the failure by the
Company to pay any installment of interest on, or liquidated damages with
respect to, the Notes as and when due and payable and the continuance of any
such failure for 30 days, (ii) the failure by the Company to pay all or any
part of the principal of, or premium, if any on the Notes when and as the same
become due and payable at maturity, redemption, by acceleration or otherwise,
including, without limitation, pursuant to any Repurchase Offer or otherwise,
(iii) the failure of the Company to perform any conversion of Notes required
under the Indenture and the continuance of any such failure for 30 days, (iv)
the failure by the Company to observe or perform any other covenant or
agreement contained in the Notes or the Indenture and, subject to certain
exceptions, the continuance of such failure for a period of 60 days after
written notice is given to the Company by the Trustee or to the Company and
the Trustee by the Holders of at least 25% in aggregate principal amount of
the Notes outstanding, (v) certain events of bankruptcy, insolvency or
reorganization in respect of the Company or any of its Subsidiaries, (vi) a
default in the payment of principal, premium or interest when due that extends
beyond any stated period of grace applicable thereto or an acceleration for
any other reason of the maturity of any Indebtedness of the Company or any of
its Subsidiaries with an aggregate principal amount in excess of $15 million,
and (vii) final unsatisfied judgments not covered by insurance aggregating in
excess of $15 million, at any one time rendered against the Company or any of
its Subsidiaries and not stayed, bonded or discharged within 75 days. The
Indenture provides that if a Default occurs and is continuing, the Trustee
must, within 90 days after the occurrence of such default, give to the Holders
notice of such default.
The Indenture provides that if an Event of Default occurs and is
continuing (other than an Event of Default specified in clause (v) above),
then in every such case, unless the principal of all of the Notes shall have
already become due and payable, either the Trustee or the Holders of 25% in
aggregate principal amount of the Notes then outstanding, by notice in writing
to the Company (and to the Trustee if given by Holders) (an "Acceleration
Notice"), may declare all principal and accrued interest thereon to be due and
payable immediately. If an Event of Default specified in clause (v) above
occurs, all principal and accrued interest thereon will be immediately due and
payable on all outstanding Notes without any declaration or other act on the
part of the Trustee or the Holders. The Holders of no less than a majority in
aggregate principal amount of Notes generally are authorized to rescind such
acceleration if all existing Events of Default, other than the non-payment of
the principal of, premium, if any, and interest on, and liquidated damages
with respect to, the Notes that have become due solely by such acceleration,
have been cured or waived.
Prior to the declaration of acceleration of the maturity of the Notes, the
Holders of a majority in aggregate principal amount of the Notes at the time
outstanding may waive on behalf of all the Holders any default, except a
default in the payment of principal of or interest on any Note not yet cured,
or a default with respect to any covenant or provision that cannot be modified
or amended without the consent of the Holder of each outstanding Note
affected. Subject to the provisions of the Indenture relating to the duties
of the Trustee, the Trustee is under no obligation to exercise any of its
rights or powers under the Indenture at the request, order or direction of any
of the Holders, unless such Holders have offered to the Trustee reasonable
security or indemnity. Subject to all provisions of the Indenture and
applicable law, the Holders of a majority in aggregate principal amount of the
Notes at the time outstanding have the right
14.
<PAGE>
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.
Amendments and Supplements
The Indenture contains provisions permitting the Company and the Trustee
to enter into a supplemental indenture for certain limited purposes without
the consent of the Holders. With the consent of the Holders of not less than
a majority in aggregate principal amount of the Notes at the time outstanding,
the Company and the Trustee are permitted to amend or supplement the Indenture
or any supplemental indenture or modify the rights of the Holders; provided,
that no such modification may, without the consent of each Holder affected
thereby: (i) change the Stated Maturity of any Note or reduce the principal
amount thereof or the rate (or extend the time for payment) of interest
thereon or any premium payable upon the redemption thereof, or change the
place of payment where, or the coin or currency in which, any Note or any
premium or the interest thereon is payable, or impair the right to institute
suit for the enforcement of any such payment or the conversion of any Note on
or after the due date thereof (including, in the case of redemption, on or
after the Redemption Date), or reduce the Repurchase Price, or alter the
Repurchase Offer or redemption provisions in a manner adverse to the Holders,
or (ii) reduce the percentage in principal amount of the outstanding Notes,
the consent of whose Holders is required for any such amendment, supplemental
indenture or waiver provided for in the Indenture, or (iii) adversely affect
the right of such Holder to convert Notes, or (iv) modify any of the waiver
provisions, except to increase any required percentage or to provide that
certain other provisions of the Indenture cannot be modified or waived without
the consent of the Holder of each outstanding Note affected thereby.
No Personal Liability of Stockholders, Officer, Directors and Employees
The Indenture provides that no stockholder, employee, officer or director,
as such, past, present or future of the Company or any successor corporation
shall have any personal liability in respect of the obligations of the Company
under the Indenture or the Notes by reason of his, her or its status as such
stockholder, employee, officer or director.
Transfer and Exchange
A Holder may transfer or exchange the Notes in accordance with the
Indenture. The Company may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents, and to pay any taxes and fees
required by law or permitted by the Indenture. The Company is not required to
transfer or exchange any Notes selected for redemption. Also, the Company is
not required to transfer or exchange any Notes for a period of 15 days before
a selection of Notes to be redeemed.
The registered holder of a Note may be treated as the owner of it for all
purposes.
Book-Entry, Delivery and Form
Except as set forth below, the Notes were initially issued in the form of
registered Notes in global form (the "Global Notes"). Each Global Note was
deposited on the date of the closing of the sale of the Notes (the "Closing
Date") with, or on behalf of, The Depository Trust Company (the "Depositary")
and registered in the name of Cede & Co., as nominee of the Depositary.
Interests in Global Notes are available for purchase only by "qualified
institutional buyers," as defined in Rule 144A under the Securities Act
("QIBs").
Notes that were (i) originally issued to or transferred to institutional
"accredited investors," as defined in Rule 501(a)(1), (2), (3) or (7) under
the Securities Act, who are not QlBs or to any other persons who are not QIBs
or (ii) issued as described below under "Certificated Notes," were issued in
the form of registered definitive securities ("Certificated Notes"). Upon the
transfer to a QIB of Certificated Notes, such Certificated Notes will, unless
the Global Note has previously been exchanged for Certificated
15.
<PAGE>
Notes, be exchanged for an interest in the Global Note representing the
principal amount of Notes being transferred.
The Depositary has advised the Company that it is a limited-purpose trust
company that was created to hold securities for its participating
organizations (collectively, the "Participants") and to facilitate the
clearance and settlement of transactions in such securities between
Participants through electronic book-entry changes in accounts of its
Participants. The Depositary's Participants include securities brokers and
dealers (including the Initial Purchasers), banks and trust companies,
clearing corporations and certain other organizations. Access to the
Depositary's system is also available to other entities such as banks,
brokers, dealers and trust companies (collectively, "Indirect Participants")
that clear through or maintain a custodial relationship with a Participant,
either directly or indirectly. QIBs may elect to hold Notes purchased by them
through the Depositary. QIBs who are not Participants may beneficially own
securities held by or on behalf of the Depositary only through Participants or
Indirect Participants. Persons that are not QIBs may not hold Notes through
the Depositary.
The Company expects that pursuant to procedures established by the
Depositary (i) upon deposit of the Global Notes, the Depositary will credit
the accounts of Participants designated by the Initial Purchasers with an
interest in the Global Note and (ii) ownership of the Notes evidenced by the
Global Note will be shown on, and the transfer of ownership thereof will be
effected only through, records maintained by the Depositary (with respect to
the interests of Participants), the Participants and the Indirect
Participants. The laws of some states require that certain persons take
physical delivery in definitive form of securities that they own and that
security interests in negotiable instruments can only be perfected by delivery
of certificates representing the instruments. Consequently, the ability to
transfer Notes evidenced by the Global Note will be limited to such extent.
So long as the Depositary or its nominee is the registered owner of a
Note, the Depositary or such nominee, as the case may be, will be considered
the sole owner or holder of the Notes represented by the Global Note for all
purposes under the Indenture. Except as provided below, owners of beneficial
interests in a Global Note will not be entitled to have Notes represented by
such Global Note registered in their names, will not receive or be entitled to
receive physical delivery of Certificated Notes, and will not be considered
the owners or holders thereof under the Indenture for any purpose, including
with respect to the giving of any directions, instructions or approvals to the
Trustee thereunder. As a result, the ability of a person having a beneficial
interest in Notes represented by a Global Note to pledge such interest to
persons or entities that do not participate in the Depositary's system, or to
otherwise take actions with respect to such interest, may be affected by the
lack of a physical certificate evidencing such interest.
Neither the Company nor the Trustee has any responsibility or liability
for any aspect of the records relating to or payments made on account of Notes
by the Depositary, or for maintaining, supervising or reviewing any records of
the Depositary relating to such Notes.
Payments with respect to the principal of, premium, if any, interest on,
and liquidated damages with respect to, any Note represented by a Global Note
registered in the name of the Depositary or its nominee on the applicable
record date are payable by the Trustee to or at the direction of the
Depositary or its nominee in its capacity as the registered Holder of the
Global Note representing such Notes under the Indenture. Under the terms of
the Indenture, the Company and the Trustee may treat the persons in whose
names the Notes, including the Global Notes, are registered as the owners
thereof for the purpose of receiving such payments and for any and all other
purposes whatsoever. Consequently, neither the Company nor the Trustee has or
will have any responsibility or liability for the payment of such amounts to
beneficial owners of Notes (including principal, premium, if any, interest, or
liquidated damages with respect thereto), or to immediately credit the
accounts of the relevant Participants with such payment, in amounts
proportionate to their respective holdings in principal amount of beneficial
interests in the Global Note as shown on the records of the Depositary.
Payments by the Participants and the Indirect Participants to the beneficial
owners of Notes are governed by standing instructions and customary practice
and are the responsibility of the Participants or the Indirect Participants.
16.
<PAGE>
Certificated Notes
If (i) the Company notifies the Trustee in writing that the Depositary is
no longer willing or able to act as a depositary and the Company is unable to
locate a qualified successor within 90 days, or (ii) the Company, at its
option, notifies the Trustee in writing that it elects to cause the issuance
of Notes in definitive form under the Indenture, then, upon surrender by the
Depositary of the Global Notes, Certificated Notes will be issued to each
person that the Depositary identifies as the beneficial owner of the Notes
represented by Global Notes. In addition, subject to certain conditions, any
person having a beneficial interest in a Global Note may, upon request to the
Trustee, exchange such beneficial interest for Notes in the form of
Certificated Notes. Upon any such issuance, the Trustee is required to
register such Certificated Notes in the name of such person or persons (or the
nominee of any thereof), and cause the same to be delivered thereto.
Neither the Company nor the Trustee shall be liable for any delay by the
Depositary or any Participant or Indirect Participant in identifying the
beneficial owners of the Notes, and the Company and the Trustee may
conclusively rely on, and shall be protected in relying on, instructions from
the Depositary for all purposes (including with respect to the registration
and delivery, and the respective principal amounts, of the Notes to be
issued).
Same-Day Funds Settlement and Payment
The Indenture requires that payments in respect of the Notes represented
by the Global Notes (including principal, premium, if any, interest and
liquidated damages with respect thereto) be made by wire transfer of
immediately available funds to the accounts specified by the Depositary. With
respect to Notes represented by Certificated Notes, the Company will make all
payments of principal, premium, if any, interest and liquidated damages with
respect thereto, by mailing a check to each such Holder's registered address.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearing-house or next-day funds. In contrast, the Notes
represented by the Global Notes have been designated for trading in the PORTAL
market and to trade in the Depositary's Same-Day Funds Settlement System, and
any permitted secondary market trading activity in such Notes will, therefore,
be required by the Depositary to be settled in immediately available funds.
The Company expects that secondary trading in the Certificated Notes will also
be settled in immediately available funds.
Registration Rights; Liquidated Damages
The Company and the Initial Purchasers have entered into a Registration
Rights Agreement dated as of September 18, 1995 (the "Registration Rights
Agreement").
Pursuant to the Registration Rights Agreement, the Company has filed with
the SEC a shelf registration statement under the Securities Act (the "Shelf
Registration Statement") on Form S-3, to cover resales of Transfer Restricted
Securities by the holders thereof who satisfy certain conditions relating to
the provision of information in connection with the Shelf Registration
Statement. The Company will use its best efforts to cause the applicable
registration statement to be declared effective by the SEC as soon as
practicable after the date of filing and to keep such registration statement
effective until September 18, 1998, three years after the date of original
issue of the Notes, or until the Shelf Registration Statement is no longer
required for transfer of the Notes or the underlying Common Stock. For
purposes of the foregoing, "Transfer Restricted Securities" means each Note
and share of Common Stock issued upon conversion thereof until the date on
which such Note or share of Common Stock has been effectively registered under
the Securities Act and disposed of in accordance with the Shelf Registration
Statement or the date on which such Note or share of Common Stock is
distributed to the public pursuant to Rule 144 under the Securities Act or is
salable pursuant to Rule 144(k) under the Securities Act (or any similar
provisions then in force).
The Registration Rights Agreement provides that (i) the Company will file
the Shelf Registration Statement with the SEC on or prior to 90 days after the
Closing Date and (ii) the Company will use its best efforts to cause the Shelf
Registration Statement to be declared effective by the SEC on or prior to 120
17.
<PAGE>
days after the Closing Date (the "Effectiveness Target Date"). If (i) the
Shelf Registration Statement is not filed with the SEC on or prior to 90 days
after the Closing Date, (ii) the Shelf Registration Statement has not been
declared and effective by the SEC within 120 days after the Closing Date, or
(iii) the Shelf Registration Statement is filed and declared effective but
shall thereafter cease to be effective (without being succeeded immediately by
an additional Shelf Registration Statement filed and declared effective) for a
period of time which shall exceed 90 days in the aggregate per year (each such
event referred to in clauses (i) through (iii), a "Registration Default"), the
Company will pay liquidated damages to each Holder of Transfer Restricted
Securities, during the first 90-day period immediately following the
occurrence of such Registration Default, in an amount equal to $0.05 per week
per $1,000 principal amount of Notes and, if applicable, $0.01 per week per
share (subject to adjustment in the event of stock splits, stock
recombinations, stock dividends and the like) of Common Stock constituting
Transfer Restricted Securities held by such Holder. The amount of the
liquidated damages will increase by an additional $0.05 per week per $1,000
principal amount or $0.01 per week per share (subject to adjustment as set
forth above) of Common Stock constituting Transfer Restricted Securities for
each subsequent 90-day period until the applicable Registration Statement is
filed and the applicable Registration Statement is declared effective, or the
Shelf Registration Statement again becomes effective, as the case may be, up
to a maximum amount of liquidated damages with respect to any Registration
Default of $0.25 per week per $1,000 principal amount of Notes or $0.05 per
week per share (subject to adjustment as set forth above) of Common Stock
constituting Transfer Restricted Securities. All accrued liquidated damages
shall be paid to holder of Notes by wire transfer of immediately available
funds or by Federal funds check by the Company on each Damages Payment Date.
Following the cure of a Registration Default, liquidated damages will cease to
accrue with respect to such Registration Default.
So long as the Notes and Common Stock are outstanding, the Company will
continue to provide to holders of the Notes and Common Stock and to
prospective purchasers of the Notes and Common Stock the information required
by Rule 144A(d) (4), if applicable. The Shelf Registration Statement will
remain effective until the earlier of three years following the Closing or
until the Shelf Registration Statement is no longer required for transfer of
the Notes or the underlying Common Stock.
Certain Definitions
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
that is not a day on which banking institutions in New York, New York are
authorized or obligated by law or executive order to close.
"Capital Stock" means, with respect to any corporation, any and all
shares, interests, rights to purchase (other than convertible or exchangeable
indebtedness), warrants, options, participations or other equivalents of or
interests (however designated) in stock issued by that corporation.
"Indebtedness" of any person means, without duplication, (a) all
liabilities and obligations, contingent or otherwise, of any such person, (i)
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), (ii)
evidenced by bonds, notes, debentures or similar instruments, (iii)
representing the balance deferred and unpaid of the purchase price of any
property or services, except such as would constitute trade payables to trade
creditors in the ordinary course of business that are not more than 90 days
past their original due date, (iv) evidenced by bankers' acceptances or
similar instruments issued or accepted by banks, (v) for the payment of money
relating to a Capitalized Lease Obligation, or (vi) evidenced by a letter of
credit or a reimbursement obligation of such person with respect to any letter
of credit; (b) all net obligations of such person under Interest Swap and
Hedging Obligations; (c) all liabilities of others of the kind described in
the preceding clauses (a) or (b) that such person has guaranteed or that is
otherwise its legal liability and all obligations to purchase, redeem or
acquire any Capital Stock; and (d) any and all deferrals, renewals,
extensions, refinancings and refundings (whether direct or indirect) of any
liability of the kind described in any of the preceding clauses (a), (b) or
(c), or this clause (d), whether or not between or among the same parties.
18.
<PAGE>
"Issue Date" or "Closing Date" means the date of first issuance of the
Notes under the Indenture.
"Junior Securities" of any Person means any Qualified Capital Stock and
any Indebtedness of such Person that is subordinated in right of payment to
the Notes and has no scheduled installment of principal due, by redemption,
sinking fund payment or otherwise, on or prior to the Stated Maturity of the
Notes.
"Senior Indebtedness" of the Company means any Indebtedness of the
Company, whether outstanding on the date of the Indenture or thereafter
created, incurred, assumed, guaranteed or in effect guaranteed by the Company,
unless the instrument creating or evidencing such Indebtedness provides that
such Indebtedness is not senior or superior in right of payment to the Notes
or to other Indebtedness which is pari passu with, or subordinated to, the
Notes; provided that in no event shall Senior Indebtedness include (a)
Indebtedness of the Company owed or owing to any Subsidiary of the Company or
any officer, director or employee of the Company or any Subsidiary of the
Company, (b) Indebtedness to trade creditors, (c) the Company's 5% Convertible
Subordinated Debentures due 2000, or (d) any liability for taxes owed or owing
by the Company.
"Stated Maturity" when used with respect to any Note, means September 15,
2005.
"Subsidiary," with respect to any person, means (i) a corporation a
majority of whose Capital Stock with voting power normally entitled to vote in
the election of directors is at the time, directly or indirectly, owned by
such person, by such person and one or more Subsidiaries of such person or by
one or more Subsidiaries of such person, (ii) a partnership in which such
Person or a subsidiary of such Person is, at the time, a general partner, or
(iii) any other person (other than a corporation) in which such person, one or
more Subsidiaries of such person, or such person and one or more subsidiaries
of such person, directly or indirectly, at the date of determination thereof
has at least majority ownership interest.
SELLING SECURITYHOLDERS
The Notes and Conversion Shares that may be offered pursuant to this
Prospectus will be offered by the Selling Securityholders identified in the
table below. The following table sets forth information with respect to the
Selling Securityholders and the principal amount of Notes owned, all of which
may be sold hereunder, and the percentage of all outstanding Notes held by the
Selling Securityholders, all as of September 22, 1995:
<TABLE>
<CAPTION>
Principal
Amount of
Name of Selling Notes Percent of Total
Securityholder Owned Outstanding Notes
- -------------------------------------- ------------ ------------------
<S> <C> <C>
Investors Diversified Services $ 20,000,000 14.3%
Trust Company of the West 12,000,000 8.6
Fidelity Management 10,000,000 7.1
Lynch & Mayer 3,000,000 2.1
Oppenheimer Mgmt-Funds 3,000,000 2.1
Phoenix Insurance 3,000,000 2.1
General Motors Corp. 2,500,000 1.7
Keystone Funds Inc. 2,500,000 1.7
Oak Tree Capital 2,500,000 1.7
Peck Associates 2,500,000 1.7
Aim Investment Mgmt 2,000,000 1.4
Janus Fund 2,000,000 1.4
Massachusetts Investors Trust 2,000,000 1.4
Morgan Guaranty Tr. Co. 2,000,000 1.4
Putnam Management 2,000,000 1.4
Strong Associates 2,000,000 1.4
Allstate Insurance Co. 1,500,000 1.1
Franklin Asset Management 1,500,000 1.1
</TABLE>
19.
<PAGE>
<TABLE>
<CAPTION>
Principal
Amount of
Name of Selling Notes Percent of Total
Securityholder Owned Outstanding Notes
- -------------------------------------- ------------ ------------------
<S> <C> <C>
Vance Sanders 1,500,000 1.1
American Capital Mgmt 1,000,000 0.7
AON Corporation 1,000,000 0.7
Sea Associates 1,000,000 0.7
Delaware Management 1,000,000 0.7
Fiduciary Trust Co Of New York 1,000,000 0.7
Merrill Lynch Asset Management 1,000,000 0.7
New York Life Insurance 1,000,000 0.7
Pacific Mutual - L.A. 1,000,000 0.7
Tennessee State Ret 1,000,000 0.7
Dean Witter Intercapital 1,000,000 0.7
Fred Alger Mgmt-N.Y. 500,000 0.4
Bass Brothers Enterprises Inc. 500,000 0.7
Bank of America Capital Mgmt. 500,000 0.4
Harris Trust & Savings Bank 500,000 0.4
Neuberger Berman 500,000 0.4
Pallisade 500,000 0.4
Rochester Funds 500,000 0.4
Stein Roe & Farnham 500,000 0.4
Value Line 500,000 0.4
B.A.I.I. 3,000,000 2.1
Kuwait Financial Trading Contracting 1,000,000 0.7
Aveco Berne 750,000 0.5
Gulf Investment Partners 500,000 0.4
Vereinsbk Hamburg 500,000 0.4
Maap 400,000 0.3
Abn Amro Bank Zurich 350,000 0.3
Lloyds Geneve 350,000 0.3
Barclays Biarritz 300,000 0.2
Barque Lazard Freres 300,000 0.2
Kantonale Bank Zurich 300,000 0.2
Atag Berne 250,000 0.1
Banque Indosuez 200,000 0.1
B.S.I. (Intl.) 200,000 0.1
Capital Trust 200,000 0.1
Paribas Lugano 200,000 0.1
Rominvest 200,000 0.1
Unione Banche Svizzera 200,000 0.1
United Gulf 200,000 0.1
Banca Commerciale Lugano 100,000 0.1
Clayvard 100,000 0.1
Daiwa Inv. Trust Mgmt 100,000 0.1
Gen De Banque Brux 100,000 0.1
Paribas-Bruxelles (Intl) 100,000 0.1
Sempione 100,000 0.1
Cincinnati Financial 1,500,000 1.1
Everglades Partners 100,000 0.1
Pacific Capital 100,000 0.1
Mass Mutual Life Insurance Co. 3,000,000 2.1
Gen Capital 1,500,000 1.1
Royal Trust 1,300,000 0.9
Templeton Investment Counsel 1,000,000 0.7
</TABLE>
20.
<PAGE>
<TABLE>
<CAPTION>
Principal
Amount of
Name of Selling Notes Percent of Total
Securityholder Owned Outstanding Notes
- -------------------------------------- ------------ ------------------
<S> <C> <C>
Sahuaro Comm. 100,000 0.1
Calamos 1,500,000 1.1
State of Montana 1,500,000 1.1
Koch Industries 500,000 0.4
Camden Asset 1,500,000 1.1
Sage Capital 1,000,000 0.7
Hermes Capital 250,000 0.2
Froley Revx Investments 3,000,000 2.1
Nicholas Applegate Capital Mgmt 3,000,000 2.1
Desai Capital Mgmt 1,500,000 1.1
Orion 1,500,000 1.1
Solomon 1,500,000 1.1
Bass Brothers 1,000,000 0.7
Hull 1,000,000 0.7
Society Nat'l. Bk. 1,000,000 0.7
Baker Nye 500,000 0.4
Highbridge 500,000 0.4
Latterman 500,000 0.4
Paloma 500,000 0.4
Simon 500,000 0.4
Lipco Partners 350,000 0.3
Firebird 250,000 0.2
Forest Hills 250,000 0.2
Gabelli Asset Management 250,000 0.2
Q Investments 250,000 0.2
Carret & Co. 100,000 0.1
Gordon Mgt 100,000 0.1
Lindner Dividend Fund Inc. 5,200,000 3.6
Willougby Houn Harris & Rentner 300,000 0.2
Mctash & Hill 100,000 0.1
------------
Total $140,000,000
============
</TABLE>
The preceding table has been prepared based upon information furnished to
the Company by The Depository Trust Company ("DTC"), State Street Bank and
Trust Company, trustee under the Indenture, and by or on behalf of the Selling
Securityholders.
Other than as a result of the ownership of Notes, none of the Selling
Securityholders listed above had any material relationship with the Company
within the three year period ending on the date of this Prospectus.
Because the Selling Securityholders may offer all or some of the Notes
that they hold and/or Conversion Shares pursuant to the offering contemplated
by this Prospectus, and because there are currently no agreements,
arrangements or understandings with respect to the sale of any of the Notes or
Conversion Shares by the Selling Securityholders, no estimate can be given as
to the principal amount of Notes or Conversion Shares that will be held by the
Selling Securityholders after completion of this offering. See "Plan of
Distribution."
21.
<PAGE>
PLAN OF DISTRIBUTION
The Company will not receive any of the proceeds from this offering. The
Notes and Conversion Shares offered hereby may be sold from time to time by or
for the account of any of the Selling Securityholders or by their pledgees,
donees or transferees or other successors in interest to the Selling
Securityholders. The Notes and the Conversion Shares may be sold hereunder
directly to purchasers by the Selling Securityholders, in negotiated
transactions; by or through brokers or dealers in ordinary brokerage
transactions or transactions in which the broker solicits purchasers; block
trades in which the broker or dealer will attempt to sell Notes or Conversion
Shares as agent but may position and resell a portion of the block as
principal; transactions in which a broker or dealer purchases as principal for
resale for its own account; or through underwriters or agents. The Notes or
Conversion Shares may be sold at a fixed offering price, which may be changed,
at the prevailing market price at the time of sale, at prices related to such
prevailing market price or at negotiated prices. Any brokers, dealers,
underwriters or agents may arrange for others to participate in any such
transaction and may receive compensation in the form of discounts, commissions
or concessions from the Selling Securityholders and/or the purchasers of Notes
or Conversion Shares. Each Selling Securityholder will be responsible for
payment of any and all commissions to brokers. To the extent required, the
name of any such broker, dealer, agent or underwriter and any applicable
commissions with respect to a particular offer, including required information
pertaining to that offer, will be set forth in an accompanying Prospectus
Supplement. The aggregate proceeds to the Selling Securityholders from the
sale of the Notes and Conversion Shares offered by the Selling Securityholders
hereby will be the purchase price of such Notes and Conversion Shares less any
broker's commissions.
The Company has been advised by DLJ and PaineWebber, the Initial
Purchasers, that DLJ and PaineWebber are making and currently intend to
continue making a market in the Notes. However, DLJ and PaineWebber are not
obligated to make such a market and any market-making activities may be
discontinued at any time without notice. There can be no assurance that an
active market for the Notes will develop or continue. The Company does not
intend to apply for listing of the Notes on any securities exchange or for
quotation through the National Association of Securities Dealers Automated
Quotation System. The Common Stock is listed and principally traded on the
New York Stock Exchange.
In order to comply with the securities laws of certain states, if
applicable, the Notes and Conversion Shares will be sold in such jurisdiction
only through registered or licensed brokers or dealers. In addition, in
certain states the Notes and Conversion Shares may not be sold unless they
have been registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirement is available and
is complied with.
The Selling Securityholders and any broker-dealers, agents or underwriters
that participate with the Selling Securityholders in the distribution of the
Notes or Conversion Shares may be deemed to be "underwriters" within the
meaning of the Securities Act, in which event any commissions received by such
broker-dealers, agents or underwriters and any profit on the resale of the
Notes or Conversion Shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act.
Under applicable rules and regulations under the Exchange Act, any persons
engaged in the distribution of the Notes or the Conversion Shares offered
hereby may not simultaneously engage in market making activities with respect
to either the Notes or the Conversion Shares for a period of nine business
days (two business days in the case of Conversion Shares) prior to the
commencement of such distribution. In addition, and without limiting the
foregoing, each Selling Securityholder will be subject to applicable
provisions of the Exchange Act and the rules and regulations thereunder,
including, without limitation, Rules 10b-2, 10b-5, 10b-6 and 10b-7, which
provisions may limit the timing of purchases and sales of Notes or Conversion
Shares by the Selling Securityholders.
In addition, any securities covered by this Prospectus which qualify for
sale pursuant to Rule 144 or Rule 144A of the Securities Act may be sold under
Rule 144 or Rule 144A rather than pursuant to this Prospectus. There is no
assurance that any Selling Securityholder will sell any or all of the Notes or
22.
<PAGE>
Conversion Shares described herein, and any Selling Securityholder may
transfer, devise or gift such securities by other means not described herein.
The Notes were originally sold to DLJ and PaineWebber in September 1995 in
a private placement. The Company agreed to indemnify and hold DLJ and
PaineWebber harmless against certain liabilities under the Securities Act that
could arise in connection with the sale of the Notes by DLJ and PaineWebber.
The Company and the Selling Securityholders are obligated to indemnify each
other against certain liabilities arising under the Securities Act.
The Company will use its best efforts to cause the registration statement
to which this Prospectus relates to become effective as promptly as is
practicable and to keep the registration statement effective until September
18, 1998, three years after the date of original issue of the Notes, or until
the Shelf Registration Statement is no longer required for transfer of the
Notes or the underlying Common Stock. The Company is permitted to suspend the
use of this Prospectus in connection with sales of Notes and Conversion Shares
by holders during certain periods of time under certain circumstances relating
to pending corporate developments and public filings with the Commission and
similar events. Expenses of preparing and filing the registration statement
and all post-effective amendments will be borne by the Company.
DESCRIPTION OF CAPITAL STOCK
General. As of October 3, 1995, the Company was authorized to issue
75,000,000 shares of Common Stock, par value $.01 per share, of which
25,509,909 shares were issued and outstanding, and 3,000,000 shares of
preferred stock, par value $.10 per share, of which 880,000 shares have been
designated Series A Voting Cumulative Convertible Preferred Stock ("Series A
Preferred Stock"), all of which were issued and outstanding, and of which
64,815 have been designated Series B Voting Convertible Preferred Stock, of
which none were issued and outstanding. Of the unissued shares of Common
Stock, 1,320,000 shares were reserved for issuance upon conversion of the
Series A Preferred Stock, 2,926,829 shares were reserved for issuance upon
conversion of the Company's 5% Convertible Subordinated Debentures due 2000,
5,090,909 shares were reserved for issuance upon conversion of the Notes, an
aggregate of 2,214,669 shares were reserved for issuance pursuant to the
Company's 1991 Employee Stock Option Plan, and 327,000 shares were reserved
for issuance pursuant to the Company's 1991 Directors Stock Option Plan.
Common Stock. The holders of Common Stock are entitled to one vote for
each share held of record by them on all matters to be voted on by
stockholders. There is no cumulative voting with respect to the election of
directors; thus, the holders of shares having more than 50% of the Company's
voting power (including both common and voting preferred shares) voting for
the election of directors can elect all of the directors. The holders of
Common Stock are entitled to receive dividends when, as and if declared by the
Board of Directors out of funds legally available therefor, subject to the
prior rights of preferred stockholders. In the event of liquidation,
dissolution or a winding up of the Company's affairs, the holders of Common
Stock are entitled to share ratably in all assets remaining available for
distribution to them after payment of liabilities and after provision has been
made for each class of stock, including any preferred stock, that has
preference over the Common Stock. Except as described below under "Stock
Purchase Rights," holders of shares of Common Stock, as such, have no
conversion, preemptive or other subscription rights, and there are no
redemption or sinking fund provisions applicable to the Common Stock. All of
the outstanding shares of Common Stock are, and the Shares when issued will
be, validly issued, fully paid and nonassessable.
The Company currently intends to retain earnings to provide funds for the
operation and expansion of its business and accordingly does not anticipate
paying cash dividends on the Common Stock in the foreseeable future. Any
payment of cash dividends on the Common Stock in the future will depend upon
the Company's financial condition, earnings, capital requirements and such
other factors as the Board of Directors deems relevant. Dividends on the
Common Stock are subject to the prior payment of dividends on the Series A
Preferred Stock. In addition, under the Company's credit agreement with The
First
23.
<PAGE>
National Bank of Boston and First Interstate Bank of California, no dividends
may be paid on the Common Stock without the consent of those banks.
Preferred Stock. Shares of preferred stock may be issued without
stockholder approval. The Board of Directors is authorized to issue such
shares in one or more series and to fix the rights, preferences, privileges,
qualifications, limitations and restrictions thereof, including dividend
rights and rates, conversion rights, voting rights, terms of redemption,
redemption prices, liquidation preferences and the number of shares
constituting any series or the designation of such series, without any vote or
action by the stockholders. The Company has no current plans for the issuance
of any additional shares of preferred stock. Any preferred stock to be issued
could rank prior to the Common Stock with respect to dividend rights and
rights on liquidation. The Board of Directors, without stockholder approval,
may issue preferred stock with voting and conversion rights that could
adversely affect the voting power of holders of Common Stock or create
impediments to persons seeking to gain control of the Company.
Series A Preferred Stock. Each share of Series A Preferred Stock is
currently convertible into 1.5 shares of Common Stock subject to certain
events, and votes together with the Common Stock on an "as converted" basis,
except with respect to certain actions for which the Series A Preferred Stock
is entitled to vote as a class. The Series A Preferred Stock automatically
converts into Common Stock if the closing price of the Common Stock is at
least 150% of an amount equal to $25.00 divided by the number of shares into
which each share is convertible at that time. A cumulative dividend is
payable on the Series A Preferred Stock at the rate of $.812 per share
annually, subject to adjustment under certain circumstances. The Series A
Preferred Stock has a preference in liquidation over holders of common stock
of $25 per share plus accrued dividends. The Company, at its option, may
redeem shares of the Series A Preferred Stock, subject to certain conditions,
at a price of $30 per share (and, under certain circumstances, at a price of
$25.00 per share) plus accrued dividends. Reacquired or redeemed shares are
required to be retired and cancelled.
Stock Purchase Rights. Eastern Associated Securities Corporation
(collectively with its affiliates, including Eastern Enterprises, "Eastern"),
which currently hold 3,041,092 shares of Common Stock, Laidlaw Inc. and its
affiliates ("Laidlaw"), which currently hold 2,965,829 shares of Common Stock,
and Aluminum Company of America, which currently holds 880,000 shares of
Series A Preferred Stock, have certain rights to purchase voting securities of
the Company in order to maintain their respective percentage voting interests.
Except in connection with mergers or other acquisitions or in the ordinary
course under an employee stock option or stock bonus plan, in the event the
Company proposes to sell or issue shares of voting securities, each of these
holders has the right to purchase, on the same terms as the proposed sale or
issuance, that number of shares or rights as will maintain such holder's
percentage interest in the voting securities of the Company, assuming the
conversion of all convertible securities and the exercise of all options and
warrants then outstanding. In addition, these holders have other purchase
rights with respect to sales or issuances of securities by the Company at
prices below 85% of current market price at the time of sale or issuance or
the prevailing customary price for such securities or their equivalent.
Certain Voting Arrangements. Pursuant to the agreements whereby the
Company acquired Ionpure Technologies Corporation and IP Holding Company
"Ionpure") from Eastern Enterprises in 1993, the Company agreed, so long as
Eastern owns at least 5% of the Company's voting securities, to nominate J.
Atwood Ives (or his successor at Eastern) for election to the Board and, so
long as Eastern owns at least 10% of the Company's voting securities, Eastern
has the right to designate a second member of the Board. The Company also
agreed that Mr. Ives (or his successor) will be a member of the Audit
Committee of the Board and that, upon request and with the consent of the
Board, Mr. Ives will also be appointed to the Compensation Committee or any
other committee of the Board, other than the Nominating Committee. Pursuant
to the agreements whereby the Company acquired Smogless S.p.A. ("Smogless") in
September 1994, the Company agreed, so long as Laidlaw owns at least 5% of the
Company's voting securities, to nominate a person designated by Laidlaw for
election to the Board. In addition, Eastern and Laidlaw agreed to vote all
shares owned by them for the Board's nominees for election to the Board and on
all other matters in the same proportion as the votes cast by the other
holders of voting securities, other than those that relate to any business
combination or similar transaction involving the Company or any amendment to
the Company's Certificate of Incorporation or Bylaws.
24.
<PAGE>
Eastern and Laidlaw have also agreed not to (i) solicit proxies in
opposition to a recommendation of the Board, (ii) join a group for the purpose
of acquiring, voting or disposing of voting securities of the Company or (iii)
solicit stockholders for the approval of one or more stockholder proposals.
Eastern and Laidlaw have each separately agreed not to acquire voting
securities of the Company during the six-year period following the date of the
Ionpure acquisition in the case of Eastern or the Smogless acquisition in the
case of Laidlaw if, after the acquisition, its percentage share of the
Company's voting power would exceed its percentage share on the date of
consummation of the Ionpure or the Smogless acquisition, as the case may be,
except under certain circumstances, including if any person makes (a) an offer
to acquire voting securities of the Company that would result in such person
owning 20% or more of the voting power of the Company or (b) a formal proposal
for a business combination involving control of the Company, which proposal is
either (i) not withdrawn or terminated or rejected by the Board within 30 days
after such proposal is made, or (ii) accepted by the Board.
Certain Charter and Bylaw Provisions. The Company's Certificate of
Incorporation (the "Certificate") places certain restrictions on the voting
rights of a "Related Person," defined therein as any person who directly or
indirectly owns 5% or more of the outstanding voting stock of the Company.
The founders and the original directors of the Company are excluded from the
definition of "Related Persons," as are seven named individuals including
Richard J. Heckmann, the Chairman of the Board, President and Chief Executive
Officer of the Company. These voting restrictions apply in two situations.
First, the vote of a director who is also a Related Person is not counted in
the vote of the Board of Directors to call a meeting of stockholders where
that meeting will consider a proposal made by the Related Person director.
Second, any amendments to the Certificate that relate to specified Articles
therein (those dealing with corporate governance, limitation of director
liability or amendments to the Certificate), in addition to being approved by
the Board of Directors and a majority of the Company's outstanding voting
stock, must also be approved by either (i) a majority of directors who are not
Related Persons, or (ii) the holders of at least 80% of the Company's
outstanding voting stock, provided that if the change was proposed by or on
behalf of a Related Person, then approval by the holders of a majority of the
outstanding voting stock not held by Related Persons is also required. In
addition, any amendment to the Company's Bylaws must be approved by one of the
methods specified in clauses (i) and (ii) in the preceding sentence.
The Certificate and the Company's Bylaws provide that the Board of
Directors shall fix the number of directors and that the Board shall be
divided into three classes, each consisting of one-third of the total number
of directors (or as nearly as may be possible). Stockholders may not take
action by written consent. Meetings of stockholders may be called only by the
Board of Directors (or by a majority of its members). Stockholder proposals,
including director nominations, may be considered at a meeting only if written
notice of that proposal is delivered to the Company from 30 to 60 days in
advance of the meeting, or within ten days after notice of the meeting is
first given to stockholders.
Delaware Anti-Takeover Law. Section 203 of the Delaware General
Corporation Law ("Section 203") provides, in general, that a stockholder
acquiring more than 15% of the outstanding voting shares of a corporation
subject to the statute (an "Interested Stockholder"), but less than 85% of
such shares, may not engage in certain "Business Combinations" with the
corporation for a period of three years subsequent to the date on which the
stockholder became an Interested Stockholder unless (i) prior to such date the
corporation's board of directors has approved either the Business Combination
or the transaction in which the stockholder became an Interested Stockholder
or (ii) the Business Combination is approved by the corporation's board of
directors and authorized by a vote of at least two-thirds of the outstanding
voting stock of the corporation not owned by the Interested Stockholder.
Section 203 defines the term "Business Combination" to encompass a wide
variety of transactions with or caused by an Interested Stockholder in which
the Interested Stockholder receives or could receive a benefit on other than a
pro rata basis with other stockholders, including mergers, certain asset
sales, certain issuances of additional shares to the Interested Stockholder,
transactions with the corporation that increase the proportionate interest of
the Interested Stockholder or transactions in which the Interested Stockholder
receives certain other benefits.
25.
<PAGE>
These provisions could have the effect of delaying, deferring or
preventing a change of control of the Company. The Company's stockholders, by
adopting an amendment to the Certificate or Bylaws of the Company, may elect
not to be governed by Section 203, effective twelve months after adoption.
Neither the Certificate nor the Bylaws of the Company currently excludes the
Company from the restrictions imposed by Section 203.
DESCRIPTION OF CERTAIN INDEBTEDNESS
The following summarizes the material long-term indebtedness of the
Company. At June 30, 1995, the Company's total consolidated long-term debt
(including current maturities), after giving effect to the exercise of certain
warrants to purchase Common Stock and related delivery of $45 million of
Subordinated Notes due 2001 and sale of the Notes and the application of the
net proceeds therefrom accounted for 41.5 of its total capitalization. This
summary does not include a description of the Notes and is not a complete
description of the indebtedness described. The description set forth herein
is qualified in its entirety by reference to the material agreements relating
to such indebtedness.
5% Convertible Subordinated Debentures Due 2000. The Company has
outstanding $60,000,000 principal amount of 5% Convertible Subordinated
Debentures due 2000, which are due on October 15, 2000. Interest on the 5%
Convertible Subordinated Debentures due 2000 is payable semi-annually. The 5%
Convertible Subordinated Debentures due 2000 are redeemable in whole or in
part at the option of the Company at any time on or after October 25, 1996 at
a price, expressed as a percentage of the principal amount, ranging from
102.86% in 1996 to 100.71% in 1999, plus accrued interest. The 5% Convertible
Subordinated Debentures due 2000 are unsecured subordinated obligations of the
Company and will rank pari passu in all respects with other unsecured
subordinated obligations of the Company, including the Notes. Upon certain
changes in control of the Company, holders of the 5% Convertible Subordinated
Debentures due 2000 have the right to require the Company to repurchase all or
a portion of their 5% Convertible Subordinated Debentures due 2000 at 100% of
principal amount plus accrued interest. The 5% Convertible Subordinated
Debentures due 2000 are convertible into Common Stock, currently at a
conversion price of $20.50 per share, subject to adjustment upon the
occurrence of certain events. The Company has filed and is maintaining the
effectiveness of a shelf registration statement covering resales by the
holders of all 5% Convertible Subordinated Debentures due 2000 and the Common
Stock issuable upon conversion thereof.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of certain Federal income tax considerations
for purchasers of the Notes and is based on the Federal income tax law now in
effect, which is subject to change, possibly retroactively. This summary does
not discuss all aspects of Federal income taxation that may be relevant to
particular holders of Notes in light of their individual investment
circumstances or to certain types of investors subject to special tax rules
(e.g., financial institutions, insurance companies, tax-exempt organizations
and foreign taxpayers), nor does it discuss any aspects of state, local or
foreign tax law consequences. This summary assumes that investors will hold
their Notes as "capital assets" (generally, property held for investment)
under the Internal Revenue Code of 1986, as amended. Prospective purchasers
are urged to consult their tax advisors regarding the specific Federal, state,
local and foreign income and other tax consequences of purchasing, holding and
disposing of the Notes.
Sale or Exchange
A holder will recognize capital gain or loss upon the sale or other
disposition of a Note in an amount equal to the difference between the amount
realized from such disposition and his tax basis in the Note. Such gain or
loss will be long-term if the Note has been held for more than one year.
26.
<PAGE>
Conversion
A holder's conversion of a Note into Common Stock is generally not a
taxable event (except with respect to cash received in lieu of a fractional
share). The holder's tax basis in the Common Stock received on conversion of
a Note will be the same as the holder's tax basis in the Note at the time of
conversion (exclusive of any tax basis allocable to a fractional share), and
the holding period for the Common Stock received on conversion will include
the holding period of the Note converted.
Constructive Dividend
If at any time the Company makes a distribution of property to
shareholders that would be taxable to such shareholders as a dividend for
Federal income tax purposes and, in accordance with the antidilution
provisions of the Notes, the Conversion Price of the Notes is decreased, the
amount of such decrease may be deemed to be the payment of a taxable dividend
to holders. For example, a decrease in the Conversion Price in the event of
distributions of evidence of indebtedness or assets of the Company will
generally result in deemed dividend treatment to holders, but generally a
decrease in the event of stock dividends or the distribution of rights to
subscribe for shares will not. See "Description of the Notes-Conversion
Rights."
LEGAL MATTERS
The validity of the securities offered hereby will be passed upon the
Company by Damian C. Georgino, Vice President and General Counsel of the
Company. Mr. Georgino presently holds 100 shares of the Company's Common
Stock and options granted under the Company's 1991 Employee Stock Option Plan
to purchase an aggregate of 10,000 shares of the Common Stock.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The consolidated financial statements of United States Filter Corporation
and its subsidiaries as of March 31, 1994 and 1995 and for each of the years
in the three-year period ended March 31, 1995, have been incorporated by
reference in reliance upon the report of KPMG Peat Marwick LLP, independent
certified public accountants, incorporated by reference and upon the authority
of said firm as experts in accounting and auditing.
The financial statements of Arrowhead Industrial Water, Inc. as of
December 31, 1994 and 1993 and for each of the years in the two-year period
ended December 31, 1994, have been incorporated by reference in reliance upon
the report of KPMG Peat Marwick LLP, independent certified public accountants,
incorporated by reference and upon the authority of said firm as experts in
accounting and auditing.
The financial statements of Continental H2O Services, Inc. and Evansville
Water Corporation d/b/a Interlake Water Systems as of December 31, 1994 and
for the year then ended have been incorporated by reference in reliance upon
the report of KPMG Peat Marwick LLP, independent certified public accountants,
incorporated by reference and upon the authority of said firm as experts in
accounting and auditing.
The financial statements of Polymetrics, Inc. and subsidiaries as of
December 31, 1994 and for the year then ended have been incorporated by
reference in reliance upon the report of KPMG Peat Marwick LLP, independent
certified public accountants, incorporated by reference and upon the authority
of said firm as experts in accounting and auditing.
27.
<PAGE>
================================================================================
No person has been authorized in connection with the offering made hereby to
give any information or to make any representation not contained in this
Prospectus and, if given or made, such information or representation must not be
relied upon as having been authorized by the Company or any Underwriter. This
Prospectus does not constitute an offer to sell or a solicitation of any offer
to buy any of the securities offered hereby to any person or by anyone in any
jurisdiction in which it is unlawful to make such offer or solicitation. Neither
the delivery of this Prospectus nor any sale made hereunder shall, under any
circumstances, create any implication that the information contained herein is
correct as of any date subsequent to the date hereof.
-------------
TABLE OF CONTENTS
Page
Available Information.............................................. 2
Incorporation of Certain Documents
by Reference...................................................... 2
The Company........................................................ 3
Risk Factors....................................................... 4
Ratio of Earnings to Fixed Charges................................. 6
Use of Proceeds.................................................... 6
Description of the Notes........................................... 7
Selling Securityholders............................................ 19
Plan of Distribution............................................... 22
Description of Capital Stock....................................... 23
Description of Certain Indebtedness................................ 26
Certain Federal Income Tax
Consequences...................................................... 26
Legal Matters...................................................... 27
Independent Certified Public
Accountants....................................................... 27
UNITED STATES
FILTER CORPORATION
$140,000,000
6% Convertible Subordinated Notes Due 2005
and
Shares of Common Stock
Issuable Upon Conversion Thereof
--------------
PROSPECTUS
--------------
, 1995
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The Company estimates that expenses in connection with the
distribution described in this Registration Statement will be as follows:
<TABLE>
<CAPTION>
<S> <C>
SEC registration fee........................................ $48,276
Printing expenses........................................... 3,000
Accounting fees and expenses................................ 3,000
Legal fees and expenses..................................... 6,000
Fees of Indenture Trustee................................... 0
Miscellaneous............................................... 2,724
-------
Total................................................. $63,000
=======
</TABLE>
Item 15. Indemnification of Directors and Officers
The Certificate of Incorporation and the Bylaws of the Company provide for
the indemnification of directors and officers to the fullest extent permitted by
the General Corporation Law of the State of Delaware, the state of incorporation
of the Company.
Section 145 of the General Corporation Law of the State of Delaware
authorizes indemnification when a person is made a party to any proceeding by
reason of the fact that such person is or was a director, officer, employee or
agent of the corporation or was serving as a director, officer, employee or
agent of another enterprise, at the request of the corporation, and if such
person acted in good faith and in a manner reasonably believed by him or her to
be in, or not opposed to, the best interests of the corporation. With respect to
any criminal proceeding, such person must have had no reasonable cause to
believe that his or her conduct was unlawful. If it is determined that the
conduct of such person meets these standards, he or she may be indemnified for
expenses incurred and amounts paid in such proceeding (including attorneys'
fees) if actually and reasonably incurred by him or her in connection therewith.
If such a proceeding is brought by or on behalf of the corporation (i.e., a
derivative suit), such person may be indemnified against expenses actually and
reasonably incurred if he or she acted in good faith and in a manner reasonably
believed by him or her to be in, or not opposed to, the best interests of the
corporation. There can be no indemnification with respect to any matter as to
which such person is adjudged to be liable to the corporation; however, a court
may, even in such case, allow such indemnification to such person for such
expenses as the court deems proper. Where such person is successful in any such
proceeding, he or she is entitled to be indemnified against expenses actually
and reasonably incurred by him or her. In all other cases, indemnification is
made by the corporation upon a determination that indemnification of such person
is proper because such person has met the applicable standard of conduct. Such
determination is made (i) by a majority vote of the directors who are not
parties to such proceeding, or (2) if there are no such directors, or if such
directors so direct, by independent legal counsel in a written opinion, or (3)
by the stockholders.
The Company maintains an errors and omissions liability policy for the
benefit of its officers and directors, which may cover certain liabilities of
such individuals to the Company.
Item 16. Exhibits
4.1 Specimen Common Stock Certificate.(1)
4.2 Form of Note.
4.3 Indenture dated as of September 18, 1995 between the Company and The
First National Bank of Boston, as Indenture Trustee.
II-1
<PAGE>
4.4 Registration Rights Agreement dated as of September 18, 1995 among
the Company, Donaldson, Lufkin & Jenrette Securities Corporation and
PaineWebber Incorporated.
5.1 Opinion of Damian C. Georgino, Esq., as to the legality of shares of
Common Stock and Notes registered hereby.
12.1 Computation of Ratio of Earnings to Fixed Charges.
23.1 Consent of Damian C. Georgino, Esq. (to be included in Exhibit 5.1).
23.2 Consents of KPMG Peat Marwick LLP.
24.1 Power of Attorney (included on page II-3 hereof).
25.1 Statement of eligibility of Indenture Trustee on Form T-1.
- -------------
(1) Previously filed as Exhibit 4.1 to the Company's Registration Statement on
Form S-1 (Reg. No. 33-41089), filed on June 21, 1991, and incorporated
herein by reference.
Item 17. Undertakings
(a) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Company pursuant to the foregoing provisions, or otherwise, the Company has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Company of expenses incurred or
paid by a director, officer or controlling person of the Company in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
(b) The undersigned Company hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the Company pursuant to Rule 424(b)(1) or (4)
or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(3) For purposes of determining any liability under the Securities Act
of 1933, each filing of the Company's annual report pursuant to section
13(a) or section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Palm Desert, State of California, on October 6, 1995.
UNITED STATES FILTER CORPORATION
By /s/Richard J. Heckmann
--------------------------------------
Richard J. Heckmann
President and Chief Executive Officer
POWER OF ATTORNEY
The officers and directors of United States Filter Corporation, whose
signatures appear below, hereby constitute and appoint Richard J. Heckmann,
Kevin L. Spence and Damian C. Georgino, and each of them, their true and lawful
attorneys and agents, each with power to act alone, to sign, execute and cause
to be filed on behalf of the undersigned any amendment or amendments, including
post-effective amendments, to this Registration Statement of United States
Filter Corporation on Form S-3. Each of the undersigned does hereby ratify and
confirm all that said attorneys and agents shall do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/Richard J. Heckmann Chairman of the Board, October 6, 1995
- ---------------------- President and Chief
Richard J. Heckmann Executive Officer
/s/Kevin L. Spence Vice President and Chief October 6, 1995
- ------------------ Financial Officer (Principal
Kevin L. Spence Accounting Officer)
/s/Michael J. Reardon Director October 6, 1995
- ---------------------
Michael J. Reardon
/s/Tim L. Traff Director October 6, 1995
- ---------------
Tim L. Traff
/s/James R. Bullock Director October 6, 1995
- -------------------
James R. Bullock
/s/James E. Clark Director October 6, 1995
- -----------------
James E. Clark
II-3
<PAGE>
- --------------------
John L. Diederich Director
/s/J. Atwood Ives Director October 6, 1995
- -----------------
J. Atwood Ives
/s/Arthur B. Laffer Director October 6, 1995
- -------------------
Arthur B. Laffer
/s/Alfred E. Osborne, Jr. Director October 6, 1995
- -------------------------
Alfred E. Osborne, Jr.
/s/C. Howard Wilkins, Jr. Director October 6, 1995
- -------------------------
C. Howard Wilkins, Jr.
II-4
<PAGE>
EXHIBIT INDEX
4.1 Specimen Common Stock Certificate.(1)
4.2 Form of Note.
4.3 Indenture dated as of September 18, 1995 between the Company and The
First National Bank of Boston, as Indenture Trustee.
4.4 Registration Rights Agreement dated as of September 18, 1995 among the
Company, Donaldson, Lufkin & Jenrette Securities Corporation and
PaineWebber Incorporated.
5.1 Opinion of Damian C. Georgino, Esq., as to the legality of shares of
Common Stock and Notes registered hereby.
12.1 Computation of Ratio of Earnings to Fixed Charges.
23.1 Consents of Damian C. Georgino, Esq. (to be included in Exhibit 5.1).
23.2 Consents of KPMG Peat Marwick LLP.
24.1 Power of Attorney (included on page II-3 hereof).
25.1 Statement of eligibility of Indenture Trustee on Form T-1.
- -------------
(1) Previously filed as Exhibit 4.1 to the Company's Registration Statement on
Form S-1 (Reg. No. 33-41089), filed on June 21, 1991, and incorporated
herein by reference.
II-5
<PAGE>
EXHIBIT 4.2
UNITED STATES FILTER CORPORATION
6% CONVERTIBLE SUBORDINATED NOTE
DUE 2005
No. CUSIP No. ____________
$ _______
United States Filter Corporation, a Delaware corporation (hereinafter
called the "Company," which term includes any successors under the Indenture
hereinafter referred to), for value received, hereby promises to pay to hereby
promises to pay to _____, or registered assigns, the principal sum of _____
DOLLARS ($____________), on September 15, 2005.
Interest Payment Dates: March 15 and September 15; commencing
March 15, 1996.
Record Dates: March 1 and September 1.
Reference is made to the further provisions of this Security on the
reverse side, which will, for all purposes, have the same effect as if set forth
at this place.
IN WITNESS WHEREOF, the Company has caused this Instrument to be duly
executed under its corporate seal.
Dated: September 18, 1995
UNITED STATES FILTER CORPORATION,
a Delaware corporation
[Seal]
By:
-------------------------------
Name:
Title:
Attest:
-----------------------------
Secretary
This is one of the Securities described in the within-mentioned
Indenture.
THE FIRST NATIONAL BANK OF BOSTON,
as Trustee
Dated: By:
-------------------------------
Authorized Signatory
<PAGE>
UNITED STATES FILTER CORPORATION
6% CONVERTIBLE SUBORDINATED NOTE
DUE 2005
Unless and until it is exchanged in whole or in part for Securities in
definitive form, this Security may not be transferred except as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary. Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the Company
or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as is requested by an authorized representative of DTC (and any payment is made
to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein./1/
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS THREE YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
AFFILIATED PERSON OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY) EXCEPT (A) TO THE COMPANY, (B) PURSUANT
- ---------------------------
/1/ This paragraph should only be added if the Security is issued in global
form.
2
<PAGE>
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) PURSUANT TO RULE 144A, FOR SO LONG AS IT IS AVAILABLE,
TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR," WITHIN THE MEANING OF RULE 501(a)(1),
(2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR
ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED
INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR
SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE
TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND IN
EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM
APPEARING ON THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO
THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER
AFTER THE RESALE RESTRICTION TERMINATION DATE./2/
1. Interest.
--------
United States Filter Corporation, a Delaware corporation (hereinafter
called the "Company," which term includes any successors under the Indenture
hereinafter referred to), promises to pay interest on the principal amount of
this Security at the rate of 6% per annum. To the extent it is lawful, the
Company promises to pay interest on any
- ---------------------------
/2/ This paragraph should be included only for the Transfer Restricted
Securities.
3
<PAGE>
interest payment due but unpaid on such principal amount at a rate of 6% per
annum compounded semi-annually.
The Company will pay interest semi-annually on March 15 and September
15 of each year (each, an "Interest Payment Date"), commencing March 15, 1996.
Interest on the Securities will accrue from the most recent date to which
interest has been paid or, if no interest has been paid on the Securities, from
September 18, 1995. Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months.
2. Method of Payment.
-----------------
The Company shall pay interest on the Securities (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date. Holders must
surrender Securities to a Paying Agent to collect principal payments. Any such
interest not so punctually paid, and defaulted interest relating thereto, may be
paid to the Persons who are registered Holders at the close of business on a
Special Record Date for the payment of such defaulted interest, as more fully
provided in the Indenture referred to below. Except as provided below, the
Company shall pay principal and interest in such coin or currency of the United
States of America as at the time of payment shall be legal tender for payment of
public and private debts ("U.S. Legal Tender"). The Securities will be payable
as to principal, premium, interest and Liquidated Damages at the office or
agency of the Company maintained for such purpose within or without the City and
State of New York, or at the option of the Company, payment of principal,
premium, interest and Liquidated Damages may be made by check mailed to the
Holders at their addresses set forth in the registry of Holders, and provided
that payment by wire transfer of immediately available funds will be required
with respect to principal of, premium and interest on and Liquidated Damages
with respect to Global Securities and all other Securities the Holders of which
shall have provided wire transfer instructions to the Company or the Paying
Agent.
3. Paying Agent and Registrar.
--------------------------
Initially, The First National Bank of Boston (the "Trustee") will act
as Paying Agent and Registrar. The Company may change any Paying Agent,
Registrar or co-Regis-
4
<PAGE>
trar without notice to the Holders. The Company or any of its Subsidiaries may,
subject to certain exceptions, act as Paying Agent, Registrar or co-Registrar.
4. Indenture.
---------
The Company issued the Securities under an Indenture, dated as of
September 18, 1995 (the "Indenture"), between the Company and the Trustee.
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act, as in effect on the date of the Indenture. The Securities are
subject to all such terms, and Holders of Securities are referred to the
Indenture and said Act for a statement of them. The Securities are general
unsecured obligations of the Company limited in aggregate principal amount to
$143,750,000.
5. Redemption.
----------
The Securities may be redeemed in whole or from time to time in part
at any time on and after September 23, 1998, at the option of the Company, at
the Redemption Price (expressed as a percentage of principal amount) set forth
below with respect to the indicated Redemption Date, in each case, plus any
accrued but unpaid interest and Liquidated Damages to the Redemption Date. The
Securities may not be so redeemed prior to September 23, 1998.
If redeemed during
the 12-month period
beginning September 15 Redemption Price
---------------------- ----------------
1998 ................. 103.75%
1999 ................. 103.00%
2000 ................. 102.25%
2001 ................. 101.50%
2002 ................. 100.75%
2003 and thereafter .. 100%
Any such redemption will comply with Article III of the Indenture.
5
<PAGE>
6. Notice of Redemption.
--------------------
Notice of redemption will be sent by first class mail, at least 30
days and not more than 60 days prior to the Redemption Date to the Holder of
each Security to be redeemed at such Holder's last address as then shown upon
the registry books of the Registrar. Securities may be redeemed in part in
multiples of $1,000 only.
Except as set forth in the Indenture, from and after any Redemption
Date, if monies for the redemption of the Securities called for redemption shall
have been deposited with the Paying Agent on such Redemption Date and payment of
the Securities called for redemption is not prohibited under Article XII of the
Indenture, the Securities called for redemption will cease to bear interest and
the only right of the Holders of such Securities will be to receive payment of
the Redemption Price, plus any accrued and unpaid interest and Liquidated
Damages, if any, to the Redemption Date.
7. Denominations; Transfer; Exchange.
---------------------------------
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder may register
the transfer of, or exchange Securities in accordance with, the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange any Securities selected for redemption.
8. Persons Deemed Owners.
---------------------
The registered Holder of a Security may be treated as the owner of it
for all purposes.
9. Unclaimed Money.
---------------
If money for the payment of principal, interest or Liquidated Damages
remains unclaimed for two years, the Trustee and the Paying Agent(s) will pay
the money back to the Company at its written request. After that, all liability
of the Trustee and such Paying Agent(s) with respect to such money shall cease.
6
<PAGE>
10. Amendment; Supplement; Waiver.
-----------------------------
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented, and any existing Default or Event of Default or
compliance with any provision may be waived, with the written consent of the
Holders of a majority in aggregate principal amount of the Securities then
outstanding. Without notice to or consent of any Holder, the parties thereto
may amend or supplement the Indenture or the Securities to, among other things,
cure any ambiguity, defect or inconsistency, or make any other change that does
not adversely affect the rights of any Holder of a Security.
11. Conversion Rights.
-----------------
Subject to the provisions of the Indenture, the Holders have the right
to convert the principal amount of the Securities into fully paid and
nonassessable shares of Common Stock of the Company at the initial conversion
price per share of Common Stock of $27.50 (or $27.50 in principal amount of
Securities for each such share of Common Stock), or at the adjusted conversion
price then in effect, if adjustment has been made as provided in the Indenture,
upon surrender of the Security to the Company, together with a fully executed
notice in substantially the form attached hereto and, if required by the
Indenture, an amount equal to accrued interest payable on such Security.
12. Ranking.
-------
Payment of principal, premium, if any, interest on and Liquidated
Damages with respect to the Securities is subordinated, in the manner and to the
extent set forth in the Indenture, to the prior payment in full of all Senior
Indebtedness.
13. Repurchase at Option of Holder Upon a Change of Control.
-------------------------------------------------------
If there is a Change of Control, the Company shall be required to
offer to purchase on the Repurchase Date all outstanding Securities at a
purchase price equal to 101% of the principal amount thereof, plus accrued and
unpaid interest and Liquidated Damages, if any, to the Repurchase Date. Holders
of Securities will receive a Repurchase Offer from the Company prior to any
related Repurchase Date and may
7
<PAGE>
elect to have such Securities purchased by completing the form entitled "Option
of Holder to Elect Purchase" appearing below.
14. Successors.
----------
When a successor assumes all the obligations of its predecessor under
the Securities and the Indenture, the predecessor will be released from those
obligations.
15. Defaults and Remedies.
---------------------
If an Event of Default occurs and is continuing (other than as Event
of Default relating to certain events of bankruptcy, insolvency or
reorganization), then in every such case, unless the principal of all of the
securities shall have already become due and payable, either the Trustee or the
Holders of 25% in aggregate principal amount of Securities then outstanding may
declare all the Securities to be due and payable immediately in the manner and
with the effect provided in the Indenture. Holders of Securities may not
enforce the Indenture or the Securities except as provided in the Indenture.
The Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Securities. Subject to certain limitations, Holders of a
majority in aggregate principal amount of the Securities then outstanding may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of Securities notice of any continuing Default or Event of
Default (except a Default in payment of principal, interest or Liquidated
Damages), if it determines that withholding notice is in their interest.
16. Trustee Dealings with Company.
-----------------------------
The Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates as if it were not the Trustee.
17. No Recourse Against Others.
--------------------------
No stockholder, director, officer or employee, as such, past, present
or future, of the Company or any successor corporation shall have any personal
liability in respect of the obligations of the Company under the
Securities or
8
<PAGE>
the Indenture by reason of his, her or its status as such stockholder, director,
officer or employee. Each Holder of a Security by accepting a Security waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
18. Authentication.
--------------
This Security shall not be valid until the Trustee or authenticating
agent signs the certificate of authentication on the other side of this
Security.
19. Abbreviations and Defined Terms.
-------------------------------
Customary abbreviations may be used in the name of a Holder of a
Security 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).
20. CUSIP Numbers.
-------------
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to be
printed on the Securities as a convenience to the Holders of the Securities. No
representation is made as to the accuracy of such numbers as printed on the
Securities and reliance may be placed only on the other identification numbers
printed hereon.
21. Additional Rights of Holders of Transfer Restricted Securities.
--------------------------------------------------------------
In addition to the rights provided to Holders of Securities under the
Indenture, Holders of Securities shall have all the rights set forth in the
Registration Rights Agreement.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Request may be made to:
United States Filter Corporation
73-710 Fred Waring Drive
Suite 222
9
<PAGE>
Palm Desert, California 92260
Attention: Assistant Secretary
10
<PAGE>
[FORM OF] ASSIGNMENT
I or we assign this Security to
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee)
Please insert Social Security or other identifying number of assignee
_________________________
and irrevocably appoint __________ agent to transfer this Security on the books
of the Company. The agent may substitute another to act for him.
Dated: __________ Signed: ____________________________________________________
________________________________________________________________________________
(Sign exactly as name appears on
the other side of this Security)
11
<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Article XI of the Indenture, check the box: /___/
If you want to elect to have only part of this Security purchased by
the Company pursuant to Article XI of the Indenture, state the amount you want
to be purchased: $________
Date: ________________ Signature: _____________________________________________
(Sign exactly as your name appears on the
other side of this Security)
12
<PAGE>
SCHEDULE OF EXCHANGES OF DEFINITIVE SECURITIES/3/
The following exchanges of a part of this Global Security for
Definitive Securities have been made:
<TABLE>
<CAPTION>
Amount of Amount of Principal Amount Signature of
decrease in increase in of this Global authorized officer
Principal Amount Principal Amount Security following of Trustee or
Date of of this Global of this Global such decrease (or Securities
Exchange Security Security increase) Custodian
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
</TABLE>
- ---------------------------
/3/ This schedule should only be added if the Security is issued in global
form.
13
<PAGE>
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF
SECURITIES
Re: 6% CONVERTIBLE SUBORDINATED NOTES DUE 2005 OF UNITED STATES FILTER
CORPORATION.
This Certificate relates to $______ principal amount of Securities held in
*_____ book-entry or * ______ definitive form by _____ (the "Transferor").
1. The Transferor:*
[_] (a) has requested the Trustee by written order to deliver in exchange for
its beneficial interest in the Global Security held by the Depositary a Security
or Securities in definitive, registered form of authorized denominations and an
aggregate principal amount equal to its beneficial interest in such Global
Security (or the portion thereof indicated above); or
[_] (b) has requested the Trustee by written order to exchange or register the
transfer of a Security or Securities.
2. In connection with any such request and in respect of each such
Security, the Transferor does hereby certify that Transferor is familiar with
the Indenture relating to the above-captioned Securities and as provided in
Section 2.6 of such Indenture, the transfer of this Security does not require
registration under the Securities Act because:/*/
[_] (a) Such Security is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 2.6(a)(ii)(A) or Section
2.6(d)(i)(A) of the Indenture).
[_] (b) Such Security is being transferred to a person who the Transferor
reasonably believes is a "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) purchasing for its own account or for the account
of a qualified institutional buyer over which it
exercises sole investment discretion that is aware that the transfer is
- ---------------------------
*Check applicable box.
14
<PAGE>
being made in reliance on Rule 144A (in satisfaction of Section 2.6(a)(ii)(B),
Section 2.6(b)(i) or Section 2.6(d)(i)(B) of the Indenture).
[_] (c) Such Security is being transferred pursuant to an exemption from
registration in accordance with Regulation S under the Securities Act (in
satisfaction of Section 2.6(a)(ii)(C) or Section 2.6 (d)(i)(C) of the
Indenture).
[_] (d) Such Security is being transferred to an institutional investor
that is an "accredited investor" within the meaning of Rule 501(a)(1),(2),(3) or
(7) under the Securities Act which delivers a certificate in the form of Exhibit
A to the Indenture to the Trustee (in satisfaction of Section 2.6(a)(ii)(D) or
Section 2.6(d)(i)(D) of the Indenture).
[_] (e) Such Security is being transferred in reliance on and in compliance
with another exemption from the registration requirements of the Securities Act.
An Opinion of Counsel to the effect that such transfer does not require
registration under the Securities Act accompanies this Certificate (in
satisfaction of Section 2.6(a)(ii)(E) or Section 2.6(d)(i)(E) of the Indenture).
---------------------------------------
[INSERT NAME OF TRANSFEROR]
By:
------------------------------------
Date:
---------------------------
3. Affiliation with the Company [check if applicable]
[ ] (a) The undersigned represents and warrants that it is, or at some time
during which it held this Security was, an Affiliate of the Company.
15
<PAGE>
(b) If 3(a) above is checked and if the undersigned was not an Affiliate
---
of the Company at all times during which it held this Security,
indicate the periods during which the undersigned was an Affiliate of
the Company:
________________________________.
(c) If 3(a) above is checked and if the Transferee will not pay the full
---
purchase price for the transfer of this Security on or prior to the date of
transfer indicate when such purchase price will be paid:
________________________________.
TO BE COMPLETED BY TRANSFEREE IF 2(b) ABOVE IS CHECKED AND THE TRANSFEROR IS NOT
A QUALIFIED INSTITUTIONAL BUYER:
The undersigned represents and warrants that it is a "qualified
institutional buyer" as defined in Rule 144A under the Securities Act of 1933,
as amended, and acknowledges that it has received such information regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information.
Dated:_______________ ____________________________________________________
NOTICE: To be executed by
an officer.
TO BE COMPLETED BY TRANSFEREE IF 2(c) ABOVE IS CHECKED:
The undersigned represents and warrants that it is not a "U.S. Person"
(as defined in Regulation S under the Securities Act of 1933, as amended).
Dated:_______________ ____________________________________________________
NOTICE: To be executed by
an officer.
If none of the boxes under Section 2 of this certificate is checked or if any of
the above representations required to be made by the Transferee is not made, the
Registrar shall not be obligated to register this Security in the name of any
person other than the Holder hereof.
THE UNDERSIGNED HEREBY AGREES THAT, UNLESS THE BOX ABOVE UNDER ITEM 3(a) IS
CHECKED, THE UNDERSIGNED SHALL BE DEEMED
16
<PAGE>
TO HAVE REPRESENTED THAT IT IS NOT NOR HAS IT BEEN AT ANY TIME DURING WHICH IT
HELD THIS SECURITY AN AFFILIATE, AS DEFINED IN RULE 144 UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OF THE COMPANY.
Dated:_______________ ____________________________________________________
NOTICE: The signature of the Holder to this
assignment must correspond with the name as written
upon the face of this Security particular, without
alteration or enlargement or any change whatsoever.
17
<PAGE>
EXHIBIT 4.3
================================================================================
UNITED STATES FILTER CORPORATION,
ISSUER,
AND
THE FIRST NATIONAL BANK OF BOSTON,
TRUSTEE
-------------------
INDENTURE
Dated as of September 18, 1995
-------------------
$143,750,000
6% Convertible Subordinated Notes due 2005
================================================================================
<PAGE>
TABLE OF CONTENTS
PAGE
----
<TABLE>
<CAPTION>
ARTICLE I
<S> <C> <C>
DEFINITIONS AND INCORPORATION BY REFERENCE................................ 1
SECTION 1.1. Definitions................................................. 1
SECTION 1.2. Incorporation by Reference of TIA........................... 11
SECTION 1.3. Rules of Construction....................................... 12
<CAPTION>
ARTICLE II
<S> <C> <C>
THE SECURITIES............................................................ 12
SECTION 2.1. Form and Dating............................................. 12
SECTION 2.2. Execution and Authentication................................ 13
SECTION 2.3. Registrar and Paying Agent.................................. 14
SECTION 2.4. Paying Agent to Hold Assets in Trust........................ 15
SECTION 2.5. Securityholder Lists........................................ 15
SECTION 2.6. Transfer and Exchange....................................... 15
SECTION 2.7. Replacement Securities...................................... 24
SECTION 2.8. Outstanding Securities...................................... 24
SECTION 2.9. Treasury Securities......................................... 25
SECTION 2.10. Temporary Securities........................................ 25
SECTION 2.11. Cancellation................................................ 25
SECTION 2.12. Defaulted Interest.......................................... 26
<CAPTION>
ARTICLE III
<S> <C>
REDEMPTION................................................................ 27
SECTION 3.1. Right of Redemption......................................... 27
SECTION 3.2. Notices to Trustee.......................................... 28
SECTION 3.3. Selection of Securities to Be Redeemed...................... 28
SECTION 3.4. Notice of Redemption........................................ 29
SECTION 3.5. Effect of Notice of Redemption.............................. 30
SECTION 3.6. Deposit of Redemption Price................................. 30
SECTION 3.7. Securities Redeemed in Part................................. 31
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
ARTICLE IV
<S> <C>
COVENANTS................................................................. 31
SECTION 4.1. Payment of Securities....................................... 31
SECTION 4.2. Maintenance of Office or Agency............................. 32
SECTION 4.3. Corporate Existence......................................... 32
SECTION 4.4. Payment of Taxes and Other Claims........................... 33
SECTION 4.5. Maintenance of Properties and Insurance..................... 33
SECTION 4.6. Compliance Certificate; Notice of Default................... 34
SECTION 4.7. Reports..................................................... 35
SECTION 4.8. Limitation on Status as Investment Company.................. 35
SECTION 4.9. Waiver of Stay, Extension or Usury Laws..................... 36
SECTION 4.10. Rule 144A Information Requirement........................... 36
<CAPTION>
ARTICLE V
<S> <C>
SUCCESSOR CORPORATION..................................................... 36
SECTION 5.1. Limitation on Merger, Sale or Consolidation................. 36
SECTION 5.2. Successor Corporation Substituted........................... 37
<CAPTION>
ARTICLE VI
<S> <C>
EVENTS OF DEFAULT AND REMEDIES............................................ 38
SECTION 6.1. Events of Default........................................... 38
SECTION 6.2. Acceleration of Maturity Date; Rescission and Annulment..... 40
SECTION 6.3. Collection of Indebtedness and Suits for Enforcement by
Trustee..................................................... 42
SECTION 6.4. Trustee May File Proofs of Claim............................ 43
SECTION 6.5. Trustee May Enforce Claims Without Possession of Securities. 44
SECTION 6.6. Priorities.................................................. 44
SECTION 6.7. Limitation on Suits......................................... 45
SECTION 6.8. Unconditional Right of Holders to Receive Principal,
Premium, Interest and Liquidated Damages.................... 46
SECTION 6.9. Rights and Remedies Cumulative.............................. 46
SECTION 6.10. Delay or Omission Not Waiver................................ 46
SECTION 6.11. Control by Holders.......................................... 47
SECTION 6.12. Waiver of Past Default...................................... 47
SECTION 6.13. Undertaking for Costs....................................... 48
</TABLE>
ii
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 6.14. Restoration of Rights and Remedies.......................... 48
<CAPTION>
ARTICLE VII
<S> <C> <C>
TRUSTEE................................................................... 49
SECTION 7.1. Duties of Trustee........................................... 49
SECTION 7.2. Rights of Trustee........................................... 50
SECTION 7.3. Individual Rights of Trustee................................ 51
SECTION 7.4. Trustee's Disclaimer........................................ 52
SECTION 7.5. Notice of Default........................................... 52
SECTION 7.6. Reports by Trustee to Holders............................... 52
SECTION 7.7. Compensation and Indemnity.................................. 53
SECTION 7.8. Replacement of Trustee...................................... 54
SECTION 7.9. Successor Trustee by Merger, Etc............................ 55
SECTION 7.10. Eligibility; Disqualification............................... 55
SECTION 7.11. Preferential Collection of Claims Against Company........... 55
<CAPTION>
ARTICLE VIII
<S> <C> <C>
SATISFACTION AND DISCHARGE................................................ 56
SECTION 8.1. Satisfaction and Discharge of Indenture..................... 56
SECTION 8.2. Repayment to the Company.................................... 56
<CAPTION>
ARTICLE IX
<S> <C> <C>
AMENDMENTS, SUPPLEMENTS AND WAIVERS....................................... 57
SECTION 9.1. Supplemental Indentures Without Consent of Holders.......... 57
SECTION 9.2. Amendments, Supplemental Indentures and Waivers with Consent
of Holders.................................................. 57
SECTION 9.3. Compliance with TIA......................................... 59
SECTION 9.4. Revocation and Effect of Consents........................... 59
SECTION 9.5. Notation on or Exchange of Securities....................... 60
SECTION 9.6. Trustee to Sign Amendments, Etc............................. 61
<CAPTION>
ARTICLE X
<S> <C> <C>
[RESERVED]
</TABLE>
iii
<PAGE>
<TABLE>
<CAPTION>
ARTICLE XI
<S> <C> <C>
RIGHT TO REQUIRE REPURCHASE............................................... 61
SECTION 11.1. Repurchase of Securities at Option of the Holder Upon a
Change of Control.......................................... 61
<CAPTION>
ARTICLE XII
<S> <C> <C>
SUBORDINATION............................................................. 64
SECTION 12.1. Securities Subordinated to Senior Indebtedness.............. 64
SECTION 12.2. No Payment on Securities in Certain Circumstances........... 65
SECTION 12.3. Securities Subordinated to Prior Payment of All Senior
Indebtedness on Dissolution, Liquidation or Reorganization.. 66
SECTION 12.4. Securityholders to Be Subrogated to Rights of Holders of
Senior Indebtedness......................................... 68
SECTION 12.5. Obligations of the Company Unconditional.................... 68
SECTION 12.6. Trustee Entitled to Assume Payments Not Prohibited in
Absence of Notice........................................... 69
SECTION 12.7. Application by Trustee of Assets Deposited with It.......... 70
SECTION 12.8. Subordination Rights Not Impaired by Acts or Omissions of
the Company or Holders of Senior Indebtedness............... 70
SECTION 12.9. Securityholders Authorize Trustee to Effectuate
Subordination of Securities................................. 71
SECTION 12.10. Right of Trustee to Hold Senior Indebtedness................ 71
</TABLE>
iv
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 12.11. Article XII Not to Prevent Events of Default............... 72
SECTION 12.12. No Fiduciary Duty of Trustee to Holders of Senior
Indebtedness............................................... 72
<CAPTION>
ARTICLE XIII
<S> <C> <C>
CONVERSION OF SECURITIES.................................................. 72
SECTION 13.1. Conversion Privilege....................................... 72
SECTION 13.2. Exercise of Conversion Privilege........................... 73
SECTION 13.3. Fractional Interests....................................... 74
SECTION 13.4. Conversion Price........................................... 75
SECTION 13.5. Adjustment of Conversion Price............................. 75
SECTION 13.6. Continuation of Conversion Privilege in Case of Reclass-
ification, Change, Merger, Consolidation or Sale of Assets. 81
SECTION 13.7. Notice of Certain Events................................... 83
SECTION 13.8. Taxes on Conversion........................................ 84
SECTION 13.9. Company to Provide Stock................................... 84
SECTION 13.10. Disclaimer of Responsibility for Certain Matters........... 85
SECTION 13.11. Return of Funds Deposited for Redemption of Converted
Securities................................................. 85
<CAPTION>
ARTICLE XIV
<S> <C> <C>
MISCELLANEOUS............................................................. 86
SECTION 14.1. TIA Controls............................................... 86
SECTION 14.2. Notices.................................................... 86
SECTION 14.3. Communications by Holders with Other Holders............... 87
SECTION 14.4. Certificate and Opinion as to Conditions Precedent......... 87
SECTION 14.5. Statements Required in Certificate or Opinion.............. 88
SECTION 14.6. Rules by Trustee, Paying Agent, Registrar.................. 88
SECTION 14.7. Legal Holidays............................................. 88
SECTION 14.8. Governing Law.............................................. 89
SECTION 14.9. No Adverse Interpretation of Other Agreements.............. 89
</TABLE>
v
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 14.10. No Recourse Against Others.................................. 89
SECTION 14.11. Successors.................................................. 90
SECTION 14.12. Duplicate Originals......................................... 90
SECTION 14.13. Severability................................................ 90
SECTION 14.14. Table of Contents, Headings, Etc............................ 90
SECTION 14.15. Qualification of Indenture.................................. 90
SECTION 14.16. Registration Rights......................................... 91
SIGNATURES................................................................. 92
EXHIBIT A - FORM OF SECURITY............................................... A-1
EXHIBIT B - REPRESENTATION LETTER.......................................... B-1
EXHIBIT C - FORM OF CONVERSION NOTICE...................................... C-1
</TABLE>
vi
<PAGE>
CROSS-REFERENCE TABLE
<TABLE>
<CAPTION>
TIA INDENTURE
SECTION SECTION
- ------- ---------
<S> <C>
310(a)(1)............................................................ 7.10
(a)(2)............................................................ 7.10
(a)(3)............................................................ N.A.
(a)(4)............................................................ N.A.
(a)(5)............................................................ 7.10
(b) ............................................................ 7.8;
7.10;
14.2
(c) ............................................................ N.A.
311(a) ............................................................ 7.11
(b) ............................................................ 7.11
(c) ............................................................ N.A.
312(a) ............................................................ 2.5
(b) ............................................................ 14.3
(c) ............................................................ 14.3
313(a) ............................................................ 7.6
(b)(1)............................................................ N.A.
(b)(2)............................................................ 7.6
(c) ............................................................ 7.6;
14.2
(d) ............................................................ 7.6
314(a) ............................................................ 4.6;
13.2
(b) ............................................................ N.A.
(c)(1)............................................................ 2.2;
7.2;
14.4
(c)(2)............................................................ 7.2;
14.4
(c)(3)............................................................ N.A.
(d) ............................................................ N.A.
(e) ............................................................ 14.5
(f) ............................................................ N.A.
315(a) ............................................................ 7.1(b)
(b) ............................................................ 7.5;
7.6;
14.2
(c) ............................................................ 7.1(a)
</TABLE>
vii
<PAGE>
<TABLE>
<CAPTION>
TIA INDENTURE
SECTION SECTION
- ------- ---------
<S> <C>
(d)............................................................... 2.8;
6.11;
7.1(b)(c)
(e)............................................................... 6.14
316(a)(last sentence)................................................ 2.9
(a)(1)(A)......................................................... 6.11
(a)(1)(B)......................................................... 6.12
(a)(2)............................................................ N.A.
(b)............................................................... 6.12;
6.7
317(a)(1)............................................................ 6.3
(a)(2)............................................................ 6.4
(b)............................................................... 2.4
318(a)............................................................... 14.1
</TABLE>
__________
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
viii
<PAGE>
INDENTURE, dated as of September 18, 1995, between UNITED STATES
FILTER CORPORATION, a Delaware corporation (the "Company"), and The First
National Bank of Boston, a national banking association, as Trustee.
Each party hereto agrees as follows for the benefit of each other
party and for the equal and ratable benefit of the Holders of the Company's 6%
Convertible Subordinated Notes due 2005:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. Definitions.
-----------
"Acceleration Notice" shall have the meaning specified in Section 6.2.
-------------------
"Affiliate" means (i) any person directly or indirectly controlling or
---------
controlled by or under direct or indirect common control with the Company, (ii)
any spouse, immediate family member, or other relative who has the same
principal residence of any person described in clause (i) above, and (iii) any
trust in which any person described in clause (i) or (ii) above has a beneficial
interest. For purposes of this definition, the term "control" means the power
to direct the management and policies of a person, directly or through one or
more intermediaries, whether through the ownership of voting securities, by
contract, or otherwise.
"Agent" means any Registrar, Paying Agent or co-Registrar.
-----
"Bankruptcy Law" means Title 11, U.S. Code, or any similar Federal,
--------------
state or foreign law for the relief of debtors.
"beneficial owner" for purposes of the definition of Change of Control
----------------
has the meaning attributed to it in Rules 13d-3 and 13d-5 under the Exchange Act
(as in effect on the Issue Date), whether or not applicable, except that a
"person" shall be deemed to have "beneficial ownership" of all shares that any
such person has the right to acquire,
<PAGE>
whether such right is exercisable immediately or only after the passage of time
or upon the occurrence of certain events.
"Board of Directors" means, with respect to any person, the Board of
------------------
Directors of such person or any committee of the Board of Directors of such
person authorized, with respect to any particular matter, to exercise the power
of the Board of Directors of such person.
"Board Resolution" means, with respect to any person, a duly adopted
----------------
resolution of the Board of Directors of such person.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
------------
Friday that is not a day on which banking institutions in New York, New York are
authorized or obligated by law or executive order to close.
"Capitalized Lease Obligation" means rental obligations under a lease
----------------------------
that are required to be capitalized for financial reporting purposes in
accordance with GAAP, and the amount of Indebtedness represented by such
obligations shall be the capitalized amount of such obligations, as determined
in accordance with GAAP.
"Capital Stock" means, with respect to any corporation, any and all
-------------
shares, interests, rights to purchase (other than convertible or exchangeable
Indebtedness), warrants, options, participations or other equivalents of or
interests (however designated) in stock issued by that corporation.
"Cash" means such coin or currency of the United States of America as
----
at the time of payment shall be legal tender for the payment of public and
private debts.
"Change of Control" means (i) any merger or consolidation of the
-----------------
Company with or into any person or any sale, transfer or other conveyance,
whether direct or indirect, of all or substantially all of the assets of the
Company, on a consolidated basis, in one transaction or a series of related
transactions, if, immediately after giving effect to such transaction, any
"person" or "group" (as such terms are used for purposes of Sections 13(d) and
14(d) of the Exchange Act, whether or not applicable) is or becomes the
"beneficial owner," directly or indirectly, of more than 50% of the total voting
power in the aggregate normally
2
<PAGE>
entitled to vote in the election of directors, managers, or trustees, as
applicable, of the transferee or surviving entity, (ii) any "person" or "group"
(as such terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
Act, whether or not applicable) is or becomes the "beneficial owner," directly
or indirectly, of more than 50% of the total voting power in the aggregate
normally entitled to vote in the election of directors of the Company, or (iii)
during any period of 12 consecutive months after the Issue Date, individuals who
at the beginning of any such 12-month period constituted the Board of Directors
of the Company (together with any new directors whose election by such Board or
whose nomination for election by the shareholders of the Company was approved by
a vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company then in office.
"Code" means the Internal Revenue Code of 1986, as amended.
----
"Common Stock" means the Company's common stock, par value $.01 per
------------
share, or as such stock may be reconstituted from time to time.
"Company" means the party named as such in this Indenture until a
-------
successor replaces it pursuant to the Indenture, and thereafter means such
successor.
"Conversion Price" shall have the meaning specified in Section 13.5.
----------------
"Custodian" means any receiver, trustee, assignee, liquidator,
---------
sequestrator or similar official under any Bankruptcy Law.
"Damages Payment Date" shall have the meaning specified in the
--------------------
Registration Rights Agreement.
"Date of Conversion" shall have the meaning specified in Section 13.2.
------------------
"Default" means any event or condition that is, or after notice or
-------
passage of time or both would be, an Event of Default.
3
<PAGE>
"Defaulted Interest" shall have the meaning
------------------
specified in Section 2.12.
"Definitive Securities" means Securities that are in the form of
---------------------
Security attached hereto as Exhibit A that do not include the information called
for by footnotes 1 and 3 thereof.
"Depositary" means, with respect to the Securities issuable or issued
----------
in whole or in part in global form, the person specified in Section 2.3 as the
Depositary with respect to the Securities, until a successor shall have been
appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depositary" shall mean or include such successor.
"Disqualified Capital Stock" means (a) except as set forth in (b),
--------------------------
with respect to any person, Capital Stock of such person that, by its terms or
by the terms of any security into which it is convertible, exercisable or
exchangeable, is, or upon the happening of an event or the passage of time would
be, required to be redeemed or repurchased (including at the option of the
holder thereof) by such person or any of its Subsidiaries, in whole or in part,
on or prior to the Stated Maturity of the Securities and (b) with respect to any
Subsidiary of such person (including with respect to any Subsidiary of the
Company), any Capital Stock other than any common stock with no preference,
privileges, or redemption or repayment provisions.
"DTC" shall have the meaning specified in Section 2.3.
---
"Event of Default" shall have the meaning specified in Section 6.1.
----------------
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
------------
and the rules and regulations promulgated by the SEC thereunder.
"Expiration Time" shall have the meaning specified in Section 13.5.
---------------
"GAAP" means United States 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
4
<PAGE>
pronouncements of the Financial Accounting Standards Board ("FASB") or in such
other statements by such other entity as approved by a significant segment of
the accounting profession which are in effect in the United States; provided,
--------
however, that for purposes of determining compliance with covenants in the
- -------
Indenture, "GAAP" means such generally accepted accounting principles which are
in effect as of the Issue Date.
"Global Security" means a Security that contains the paragraph
---------------
referred to in footnote 1 and the additional schedule referred to in footnote 3
to the form of Security attached hereto as Exhibit A.
"Holder" or "Securityholder" means the person in whose name a Security
------ --------------
is registered on the Registrar's books.
"Indebtedness" of any person means, without duplication, (a) all
------------
liabilities and obligations, contingent or otherwise, of any such person, (i) 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), (ii) evidenced
by bonds, notes, debentures or similar instruments, (iii) representing the
balance deferred and unpaid of the purchase price of any property or services,
except such as would constitute trade payables to trade creditors in the
ordinary course of business that are not more than ninety (90) days past their
original due date, (iv) evidenced by bankers' acceptances or similar instruments
issued or accepted by banks, (v) for the payment of money relating to a
Capitalized Lease Obligation, or (vi) evidenced by a letter of credit or a
reimbursement obligation of such person with respect to any letter of credit;
(b) all net obligations of such person under Interest Swap and Hedging
Obligations; (c) all liabilities of others of the kind described in the
preceding clause (a) or (b) that such person has guaranteed or that is otherwise
its legal liability and all obligations to purchase, redeem or acquire any
Capital Stock; and (d) any and all deferrals, renewals, extensions,
refinancings, refundings (whether direct or indirect) of any liability of the
kind described in any of the preceding clauses (a), (b) or (c), or this clause
(d), whether or not between or among the same parties.
5
<PAGE>
"Indenture" means this Indenture, as amended or supplemented from
---------
time to time in accordance with the terms hereof.
"Interest Payment Date" means the stated due date of an installment of
---------------------
interest on the Securities.
"Interest Swap and Hedging Obligation" means any obligation of any
------------------------------------
person pursuant to any interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate exchange agreement,
currency exchange agreement or any other agreement or arrangement designed to
protect against fluctuations in interest rates or currency values, including,
without limitation, any arrangement whereby, directly or indirectly, such person
is entitled to receive from time to time periodic payments calculated by
applying either a fixed or floating rate of interest on a stated notional amount
in exchange for periodic payments made by such person calculated by applying a
fixed or floating rate of interest on the same notional amount.
"Issue Date" means the date of first issuance of the Securities under
----------
this Indenture.
"Junior Security" of any person means any Qualified Capital Stock and
---------------
any Indebtedness of such person that is subordinated in right of payment to the
Securities and has no scheduled installment of principal due, by redemption,
sinking fund payment or otherwise, on or prior to the Stated Maturity of the
Securities.
"Last Sale Price" shall have the meaning specified in Section 13.3.
---------------
"Legal Holiday" shall have the meaning specified in Section 14.7.
-------------
"Lien" means any mortgage, lien, pledge, charge, security interest or
----
other encumbrance of any kind, whether or not filed, recorded or otherwise
perfected under applicable law (including any conditional sale or other title
retention agreement and any lease deemed to constitute a security interest and
any option or other agreement to give any security interest).
6
<PAGE>
"Liquidated Damages" shall have the meaning specified in the
------------------
Registration Rights Agreement.
"non-electing share" shall have the meaning specified in Section 13.6.
------------------
"Notice of Default" shall have the meaning specified in
-----------------
Section 6.1(3).
"Offer" shall have the meaning specified in Section 13.5.
-----
"Officer" means, with respect to the Company, the Chief Executive
-------
Officer, the President, any Vice President, the Chief Financial Officer, the
Treasurer, the Controller, or the Secretary of the Company.
"Officers' Certificate" means, with respect to the Company, a
---------------------
certificate signed by two Officers or by an Officer and an Assistant Secretary
of the Company and otherwise complying with the requirements of Sections 14.4
and 14.5.
"Opinion of Counsel" means a written opinion from legal counsel who is
------------------
reasonably acceptable to the Trustee and which complies with the requirements of
Sections 14.4 and 14.5.
"Paying Agent" shall have the meaning specified in Section 2.3.
------------
"Payment Blockage Period" shall have the meaning specified in
-----------------------
Section 12.2.
"Payment Default" shall have the meaning specified in Section 12.2.
---------------
"Payment Notice" shall have the meaning specified in Section 12.2.
--------------
"Person" or "person" means any corporation, individual, limited
------ ------
liability company, joint stock company, joint venture, partnership,
unincorporated association, governmental regulatory entity, country, state or
political subdivision thereof, trust, municipality or other entity.
7
<PAGE>
"principal" of any Indebtedness means the principal of such
---------
Indebtedness plus, without duplication, any applicable premium, if any, on such
Indebtedness.
"property" means any right or interest in or to property or assets of
--------
any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"Purchase Agreement" means that certain Purchase Agreement, dated
------------------
September 13, 1995, by and among the Company and the Purchasers, as such
agreement may be amended, modified or supplemented from time to time in
accordance with the terms thereof.
"Purchased Shares" shall have the meaning specified in Section 13.5.
----------------
"Purchasers" means Donaldson, Lufkin & Jenrette Securities Corporation
----------
and PaineWebber Incorporated.
"Qualified Capital Stock" means any Capital Stock of the Company that
-----------------------
is not Disqualified Capital Stock.
"Record Date" means a Record Date specified in the Securities whether
-----------
or not such Record Date is a Business Day.
"Redemption Date," when used with respect to any Security to be
---------------
redeemed, means the date fixed for such redemption pursuant to Article III of
this Indenture and Paragraph 5 in the form of Security.
"Redemption Price," when used with respect to any Security to be
----------------
redeemed, means the redemption price for such redemption pursuant to Paragraph 5
in the form of Security, which shall include, without duplication, in each case,
accrued and unpaid interest and Liquidated Damages, if any, to and including the
Redemption Date.
"Registrar" shall have the meaning specified in Section 2.3.
---------
"Registration Rights Agreement" means the Registration Rights
-----------------------------
Agreement, dated the date hereof, by and among the Purchasers and the Company,
as such agreement may be amended, modified or supplemented from time to time in
accordance with the terms thereof.
8
<PAGE>
"Repurchase Date" shall have the meaning specified in Section 11.1.
---------------
"Repurchase Offer" shall have the meaning specified in Section 11.1.
----------------
"Repurchase Price" shall have the meaning specified in Section 11.1.
----------------
"Repurchase Put Date" shall have the meaning specified in
-------------------
Section 11.1.
"Restricted Security" means a Security, unless or until it has been
-------------------
(i) disposed of in a transaction effectively registered under the Securities Act
or (ii) distributed to the public pursuant to Rule 144 (or any similar provision
then in force) under the Securities Act; provided, that in no case shall a
--------
Security issued in accordance with this Indenture and the terms and provisions
of the Registration Rights Agreement be a Restricted Security.
"SEC" means the Securities and Exchange Commission.
---
"Securities" means, collectively, the 6% Convertible Subordinated
----------
Notes due 2005, as supplemented from time to time in accordance with the terms
hereof, issued under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended, and the
--------------
rules and regulations of the SEC promulgated thereunder.
"Securities Custodian" means the Trustee, as custodian with respect to
--------------------
the Securities in global form, or any successor entity thereto.
"Senior Indebtedness" of the Company means Indebtedness of the
-------------------
Company, whether outstanding on the date of the Indenture or thereafter created,
incurred, assumed, guaranteed or in effect guaranteed by the Company, unless the
instrument creating or evidencing such Indebtedness provides that such
Indebtedness is not senior or superior, in right of payment, to the Securities
or to other Indebtedness which is pari passu with, or subordinated to, the
Securities; provided, that in no event shall Senior Indebtedness include (a)
--------
Indebtedness of the Company owed or owing
9
<PAGE>
to any Subsidiary of the Company or any officer, director or employee of the
Company or any Subsidiary of the Company, (b) Indebtedness to trade creditors,
(c) the Company's 5% Convertible Subordinated Debentures due 2000, or (d) any
liability for taxes owed or owing by the Company.
"Significant Subsidiary" shall have the meaning assigned to that term
----------------------
under Regulation S-X promulgated by the SEC, as in effect on the Issue Date.
"Special Record Date" for payment of any Defaulted Interest means a
-------------------
date fixed by the Trustee pursuant to Section 2.12.
"Stated Maturity," when used with respect to any Security, means
---------------
September 15, 2005.
"Subsidiary" with respect to any person, means (i) a corporation a
----------
majority of whose Capital Stock with voting power normally entitled to vote in
the election of directors is at the time, directly or indirectly, owned by such
person, by such person and one or more Subsidiaries of such person or by one or
more Subsidiaries of such person, (ii) a partnership in which such person or a
Subsidiary of such person is, at the time, a general partner, or (iii) any other
person (other than a corporation) in which such person, one or more Subsidiaries
of such person, or such person and one or more Subsidiaries of such person,
directly or indirectly, at the date of determination thereof has at least
majority ownership interest.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)
---
77aaa-77bbbb) as in effect on the date of the execution of this Indenture.
"Trading Day" means each Monday, Tuesday, Wednesday, Thursday and
-----------
Friday, other than any day on which securities are not traded on the Nasdaq
National Market (or, if the Common Stock is not admitted to trading thereon, on
the principal national securities exchange on which the Common Stock is listed
or admitted to trading).
"Transfer Restricted Securities" means Securities that bear or are
------------------------------
required to bear the legend set forth in Section 2.6 hereof.
10
<PAGE>
"Trustee" means the party named as such in this Indenture until a
-------
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"Trust Officer" means any officer within the corporate trust division
-------------
(or any successor group) of the Trustee or any other officer of the Trustee
customarily performing functions similar to those performed by the Persons who
at that time shall be such officers, and also means, with respect to a
particular corporate trust matter, any other officer of the Trustee to whom such
trust matter is referred because of his knowledge of and familiarity with the
particular subject.
"U.S. Government Obligations" means direct non-callable obligations
---------------------------
of, or noncallable obligations guaranteed by, the United States of America for
the payment of which obligation or guarantee the full faith and credit of the
United States of America is pledged.
SECTION 1.2. Incorporation by Reference of TIA.
---------------------------------
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
----------
"indenture securities" means the Securities.
--------------------
"indenture securityholder" means a Holder or a Securityholder.
------------------------
"indenture to be qualified" means this Indenture.
-------------------------
"indenture trustee" or "institutional trustee" means the Trustee.
----------------- ---------------------
"obligor" on the indenture securities means the Company and any other
-------
obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them thereby.
11
<PAGE>
SECTION 1.3. Rules of Construction.
---------------------
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the
plural include the singular;
(5) provisions apply to successive events and transactions;
(6) "herein," "hereof" and other words of similar import refer
to this Indenture as a whole and not to any particular Article, Section or other
subdivision; and
(7) references to Sections or Articles means reference to such
Section or Article in this Indenture, unless stated otherwise.
ARTICLE II
THE SECURITIES
SECTION 1. Form and Dating.
---------------
The Securities and the Trustee's certificate of authentication, in
respect thereof, shall be substantially in the form of Exhibit A hereto, which
Exhibit is part of this Indenture. The Securities may have notations, legends
or endorsements required by law, stock exchange rule or usage. The Company
shall approve the form of the Securities and any notation, legend or endorsement
on them. Any such notations, legends or endorsements not contained in the form
of Security attached as Exhibit A hereto shall be delivered in writing to the
Trustee. Each Security shall be dated the date of its authentication.
The terms and provisions contained in the forms of Securities shall
constitute, and are hereby expressly made, a part of this Indenture and, to the
extent applicable, the Company and the Trustee, by their execution and delivery
of
12
<PAGE>
this Indenture, expressly agree to such terms and provisions and to be bound
thereby.
SECTION 2.2. Execution and Authentication.
----------------------------
Two Officers shall sign, or one Officer shall sign and one Officer
shall attest to, the Security for the Company by manual or facsimile signature.
The Company's seal shall be impressed, affixed, imprinted or reproduced on the
Securities and may be in facsimile form.
If an Officer whose signature is on a Security was an Officer at the
time of such execution but no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless and the
Company shall nevertheless be bound by the terms of the Securities and this
Indenture.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security but
such signature shall be conclusive evidence that the Security has been
authenticated pursuant to the terms of this Indenture.
The Trustee shall authenticate the Securities for original issue in
the aggregate principal amount of up to $143,750,000 upon a written order of the
Company in the form of an Officers' Certificate. The Officers' Certificate shall
specify the amount of Securities to be authenticated and the date on which the
Securities are to be authenticated. The aggregate principal amount of Securities
outstanding at any time may not exceed $143,750,000, except as provided in
Section 2.7; provided, that Securities in excess of $125,000,000 shall not be
--------
issued other than pursuant to the over-allotment option granted by the Company
to the Purchasers as provided in the Purchase Agreement. Upon the written order
of the Company in the form of an Officers' Certificate, the Trustee shall
authenticate Securities in substitution of Securities originally issued to
reflect any name change of the Company.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent.
13
<PAGE>
An authenticating agent has the same rights as an Agent to deal with the
Company, any Affiliate of the Company, or any of their respective Subsidiaries.
Securities shall be issuable only in registered form without coupons
in denominations of $1,000 and any integral multiple thereof.
SECTION 2.3. Registrar and Paying Agent.
--------------------------
The Company shall maintain an office or agency in the Borough of
Manhattan, The City of New York, where Securities may be presented for
registration of transfer or for exchange ("Registrar") and an office or agency
where Securities may be presented for payment ("Paying Agent") and where notices
and demands to or upon the Company in respect of the Securities may be served.
The Company may act as Registrar or Paying Agent, except that, for the purposes
of Articles III, VIII and XI and as otherwise specified in the Indenture,
neither the Company nor any Affiliate of the Company shall act as Paying Agent.
The Registrar shall keep a register of the Securities and of their transfer and
exchange. The Company may have one or more co-Registrars and one or more
additional Paying Agents. The term "Paying Agent" includes any additional
Paying Agent. The Company hereby initially appoints the Trustee as Registrar
and Paying Agent, and the Trustee hereby initially agrees so to act.
The Company shall enter into an appropriate written agency agreement
with any Agent not a party to this Indenture, which agreement shall implement
the provisions of this Indenture that relate to such Agent. The Company shall
promptly notify the Trustee in writing of the name and address of any such
Agent. If the Company fails to maintain a Registrar or Paying Agent, the
Trustee shall act as such.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Securities.
The Company initially appoints the Trustee to act as Securities
Custodian with respect to the Global Securities.
SECTION 2.4. Paying Agent to Hold Assets in Trust.
------------------------------------
14
<PAGE>
The Company shall require each Paying Agent other than the Trustee to
agree in writing that each Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all assets held by the Paying Agent for the payment of
principal of, premium, if any, interest on or Liquidated Damages with respect
to, the Securities (whether such assets have been distributed to it by the
Company or any other obligor on the Securities), and shall notify the Trustee in
writing of any Default in making any such payment. If either of the Company or
a Subsidiary of the Company acts as Paying Agent, it shall segregate such assets
and hold them as a separate trust fund for the benefit of the Holders or the
Trustee. The Company at any time may require a Paying Agent to distribute all
assets held by it to the Trustee and account for any assets disbursed and the
Trustee may at any time during the continuance of any payment Default, upon
written request to a Paying Agent, require such Paying Agent to distribute all
assets held by it to the Trustee and to account for any assets distributed.
Upon distribution to the Trustee of all assets that shall have been delivered by
the Company to the Paying Agent, the Paying Agent (if other than the Company or
an Affiliate of the Company) shall have no further liability for such assets.
SECTION 2.5. Securityholder Lists.
--------------------
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders. If the Trustee is not the Registrar, the Company shall furnish to the
Trustee on or before the third Business Day preceding each Interest Payment Date
and at such other times as the Trustee may request in writing a list in such
form and as of such date as the Trustee reasonably may require of the names and
addresses of Holders.
SECTION 2.6. Transfer and Exchange.
---------------------
(a) Transfer and Exchange of Definitive Securities. When Definitive
----------------------------------------------
Securities are presented to the Registrar or a co-Registrar with a request:
(x) to register the transfer of such Definitive
Securities; or
15
<PAGE>
(y) to exchange such Definitive Securities for an
equal principal amount of Definitive Securities of other authorized
denominations;
the Registrar or co-Registrar shall register the transfer or make the exchange
as requested if its reasonable requirements for such transaction are met;
provided, however, that the Definitive Securities surrendered for transfer or
- -------- -------
exchange:
(i) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Company
and the Registrar or co-Registrar, duly executed by the Holder thereof
or his attorney duly authorized in writing; and
(ii) in the case of Transfer Restricted Securities that are
Definitive Securities, shall be accompanied by the following
additional information and documents, as applicable:
(A) if such Transfer Restricted Securities are being
delivered to the Registrar by a Holder for registration in the
name of such Holder, without transfer, a certification from such
Holder to that effect (in substantially the form set forth on
the reverse of the Security); or
(B) if such Transfer Restricted Security is being
transferred to a "qualified institutional buyer" (as defined in
Rule 144A under the Securities Act) in accordance with Rule 144A
under the Securities Act, a certification to that effect (in
substantially the form set forth on the reverse of the
Security); or
(C) if such Transfer Restricted Security is being
transferred pursuant to any exemption from the registration
requirements of the Securities Act in accordance with Regulation
S under the Securities Act, a certification to that effect (in
substantially the form set forth on the reverse of the
Security);
(D) if such Transfer Restricted Security is being
transferred to an institutional investor that is an "accredited
investor" within the
16
<PAGE>
meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities
Act which delivers a certificate in the form of Exhibit B to the
Indenture to the Trustee; or
(E) if such Transfer Restricted Security is being
transferred in reliance on another exemption from the
registration requirements of the Securities Act, a certification
to that effect (in substantially the form set forth on the
reverse of the Security) accompanied by a customary opinion of
counsel substantially to the effect that such transfer may be
effected in reliance upon such exemption.
(b) Restrictions on Transfer of a Definitive Security for a
-------------------------------------------------------
Beneficial Interest in a Global Security. A Definitive Security may not be
- ----------------------------------------
exchanged for a beneficial interest in a Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the Trustee
of a Definitive Security, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Trustee, together with:
(i) if such Definitive Security is a Transfer Restricted
Security, certification, substantially in the form set forth on the
reverse of the Security, that such Definitive Security is being
transferred to a "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) in accordance with Rule 144A under the
Securities Act; and
(ii) whether or not such Definitive Security is a Transfer
Restricted Security, written instructions directing the Trustee to
make, or to direct the Securities Custodian to make, an endorsement on
the Global Security to reflect an increase in the aggregate principal
amount of the Securities represented by the Global Security;
then the Trustee shall cancel such Definitive Security and cause, or direct the
Securities Custodian to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Securities Custodian, the
aggregate principal amount of Securities represented by the Global Security to
be increased accordingly. If no Global Securities are then outstanding, the
Company shall
17
<PAGE>
issue and the Trustee shall authenticate a new Global Security in the
appropriate principal amount.
(c) Transfer and Exchange of Global Securities. The transfer
------------------------------------------
and exchange of Global Securities or beneficial interests therein shall be
effected through the Depositary, in accordance with this Indenture (including
the restrictions on transfer set forth herein) and the procedures of the
Depositary therefor.
(d) Transfer of a Beneficial Interest in a Global Security
------------------------------------------------------
for a Definitive Security.
- -------------------------
(i) Upon receipt by the Trustee of written instructions or
such other form of instructions as is customary for the Depositary
from the Depositary or its nominee on behalf of any Person having a
beneficial interest in a Global Security and upon receipt by the
Trustee of a written order or such other form of instructions as is
customary for the Depositary or the Person designated by the
Depositary as having such a beneficial interest in a Transfer
Restricted Security only, the following additional information and
documents (all of which may be submitted by facsimile):
(A) if such beneficial interest is being transferred to
the Person designated by the Depositary as being the beneficial
owner, a certification from such person to that effect (in
substantially the form set forth on the reverse of the Security);
or
(B) if such beneficial interest is being transferred to a
"qualified institutional buyer" (as defined in Rule 144A under the
Securities Act) in accordance with Rule 144A under the Securities
Act, a certification to that effect from the transferor (in
substantially the form set forth on the reverse of the Security);
or
(C) if such beneficial interest is being
transferred pursuant to any exemption from the registration
requirements of the Securities Act in accordance with Regulation S
under the Securities Act, a certification to that effect (in
substantially the form set forth on the reverse of the Security);
18
<PAGE>
(D) if such Transfer Restricted Security is being
transferred to an institutional investor that is an
"accredited investor" within the meaning of Rule 501(a)(1),
(2), (3) or (7) under the Securities Act which delivers a
certificate in the form of Exhibit B to the Indenture to the
Trustee; or
(E) if such beneficial interest is being
transferred in reliance on another exemption from the
registration requirements of the Securities Act, a
certification to that effect from the transferee or transferor
(in substantially the form set forth on the reverse of the
Security) accompanied by a customary opinion of counsel
substantially to the effect that such transfer may be effected
in reliance upon such exemption;
then the Trustee or the Securities Custodian, at the direction of the Trustee,
will cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Securities Custodian, the aggregate principal
amount of the Global Security to be reduced and, following such reduction, the
Company will execute and, upon receipt of an authentication order in the form of
an Officers' Certificate, the Trustee will authenticate and deliver to the
transferee a Definitive Security.
(ii) Definitive Securities issued in exchange for a
beneficial interest in a Global Security pursuant to this Section
2.6(d) shall be registered in such names and in such authorized
denominations as the Depositary, pursuant to instructions from its
direct or indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Definitive Securities to the
persons in whose names such Securities are so registered.
(e) Restrictions on Transfer and Exchange of Global
-----------------------------------------------
Securities. Notwithstanding any other provisions of this Indenture (other than
- ----------
the provisions set forth in subsection (f) of this Section 2.6), a Global
Security may not be transferred as a whole except by the Depositary to a nominee
of the Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
19
<PAGE>
(f) Authentication of Definitive Securities in Absence of
-----------------------------------------------------
Depositary. If at any time:
- ----------
(i) the Depositary for the Securities notifies the
Company and the Company notifies the Trustee in writing that the
Depositary is no longer willing or able to continue as Depositary for
the Global Securities and a successor Depositary for the Global
Securities is not appointed by the Company within 90 days after
delivery of such notice; or
(ii) the Company, in its sole discretion, notifies the
Trustee in writing that it elects to cause the issuance of Definitive
Securities under this Indenture;
then the Company will execute, and the Trustee, upon receipt of an Officers'
Certificate requesting the authentication and delivery of Definitive Securities,
will authenticate and deliver Definitive Securities, in an aggregate principal
amount equal to the principal amount of the Global Securities, in exchange for
such Global Securities.
(g) Legends.
-------
(i) Except as permitted by the following paragraph
(ii), each Security certificate evidencing the Global Securities and
the Definitive Securities (and all Securities issued in exchange
therefor or substitution thereof) shall bear a legend in substantially
the following form:
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION UNLESS SUCH TRANSACTION IS EXEMPT
FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES NOT
TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURI-
20
<PAGE>
TY, PRIOR TO THE DATE (THE "RESALE RESTRICTION TERMINATION
DATE") WHICH IS THREE YEARS AFTER THE LATER OF THE ORIGINAL
ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
AFFILIATED PERSON OF THE COMPANY WAS THE OWNER OF THIS SECURITY
(OR ANY PREDECESSOR OF SUCH SECURITY) EXCEPT (A) TO THE COMPANY,
(B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) PURSUANT TO RULE 144A,
FOR SO LONG AS IT IS AVAILABLE, TO A PERSON IT REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE
THE UNITED STATES WITHIN THE MEANING OF REGULATIONS UNDER THE
SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR,"
WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN
ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED
INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR
FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE
(D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND OTHER INFORMATION SATISFACTORY TO
EACH OF THEM, AND IN EACH OF THE FOREGOING CASES, A CERTIFICATE
OF TRANSFER IN THE FORM APPEARING ON THIS SECURITY IS COMPLETED
AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL
BE
21
<PAGE>
REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.
(ii) Upon any sale or transfer of a Transfer
Restricted Security (including any Transfer Restricted Security
represented by a Global Security) pursuant to Rule 144 under the
Securities Act or an effective registration statement under the
Securities Act:
(A) in the case of any Transfer Restricted Security
that is a Definitive Security, the Registrar shall permit the
Holder thereof to exchange such Transfer Restricted Security for
a Definitive Security that does not bear the legend set forth
above and rescind any restriction on the transfer of such
Transfer Restricted Security in the case of a sale or transfer
pursuant to Rule 144 under the Securities Act, after delivery of
a customary opinion of counsel; and
(B) any such Transfer Restricted Security represented
by a Global Security shall not be subject to the provisions set
forth in (i) above (such sales or transfers being subject only
to the provisions of Section 2.6(c) hereof); provided, however,
-------- -------
that with respect to any request for an exchange of a Transfer
Restricted Security that is represented by a Global Security for
a Definitive Security that does not bear a legend, which request
is made in reliance upon Rule 144 under the Securities Act, the
Holder thereof shall certify in writing (to be accompanied by a
customary opinion of counsel) to the Registrar that such request
is being made pursuant to Rule 144 under the Securities Act
(such certification to be substantially in the form set forth on
the reverse of the Security).
(h) Cancellation and/or Adjustment of Global Security. At
-------------------------------------------------
such time as all beneficial interests in a Global Security have either been
exchanged for Definitive Securities, redeemed, repurchased or cancelled, such
Global Security shall be returned to or retained and cancelled by the Trustee.
At any time prior to such cancellation, if any beneficial interest in a Global
Security is exchanged for
22
<PAGE>
Definitive Securities, redeemed, repurchased or cancelled, the principal amount
of Securities represented by such Global Security shall be reduced and an
endorsement shall be made on such Global Security, by the Trustee or the
Securities Custodian, at the direction of the Trustee, to reflect such
reduction.
(i) Obligations with respect to Transfers and Exchanges of
------------------------------------------------------
Definitive Securities.
- ---------------------
(i) To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate
Definitive Securities and Global Securities at the Registrar's or co-Registrar's
request.
(ii) No service charge shall be made for any
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any transfer tax, assessments, or similar governmental
charge payable in connection therewith (other than any such transfer taxes,
assessments, or similar governmental charge payable upon exchanges or transfers
pursuant to Section 2.2 (fourth paragraph), 2.10, 3.7, 9.5, or 11.1 (final
paragraph)).
(iii) The Registrar or co-Registrar shall not be
required to register the transfer of or exchange of (a) any Definitive Security
selected for redemption in whole or in part pursuant to Article III, except the
unredeemed portion of any Definitive Security being redeemed in part, or (b) any
Security for a period beginning 15 days before the mailing of a notice of an
offer to repurchase pursuant to Article XI hereof or the mailing of a notice of
redemption of Securities pursuant to Article III hereof and ending at the close
of business on the day of such mailing.
SECTION 2.7. Replacement Securities.
----------------------
If a mutilated Security is surrendered to the Trustee or if the Holder
of a Security claims and submits an affidavit or other evidence, satisfactory to
the Trustee, to the Trustee to the effect that the Security has been lost,
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Security if the Trustee's requirements are met. If
required by the Trustee
23
<PAGE>
or the Company, such Holder must provide an indemnity bond or other indemnity,
sufficient in the judgment of both the Company and the Trustee, to protect the
Company, the Trustee or any Agent from any loss which any of them may suffer if
a Security is replaced. The Company may charge such Holder for its reasonable,
out-of-pocket expenses in replacing a Security.
Every replacement Security is an additional obligation of the Company.
SECTION 2.8. Outstanding Securities.
----------------------
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee (including any Security represented by a
Global Security) except those cancelled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Security effected by
the Trustee hereunder and those described in this Section 2.8 as not
outstanding. A Security does not cease to be outstanding because the Company or
an Affiliate of the Company holds the Security, except as provided in Section
2.9.
If a Security is replaced pursuant to Section 2.7 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
---- ----
upon surrender of such Security and replacement thereof pursuant to Section 2.7.
If on a Redemption Date the Paying Agent (other than the Company or an
Affiliate of the Company) holds Cash or U.S. Government Obligations sufficient
to pay all of the principal and interest due on the Securities payable on that
date in accordance with Section 3.6 hereof and payment of the Securities called
for redemption is not otherwise prohibited pursuant to Article XII hereof or
otherwise, then on and after that date such Securities cease to be outstanding
and interest on them ceases to accrue.
SECTION 2.9. Treasury Securities.
-------------------
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, amendment, supplement, waiver or
consent, Securities
24
<PAGE>
owned by the Company or an Affiliate of the Company shall be disregarded, except
that, for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, amendment, supplement, waiver or consent, only
Securities that the Trustee knows are so owned shall be disregarded.
SECTION 2.10. Temporary Securities.
--------------------
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Company reasonably and in good faith considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate definitive Securities in
exchange for temporary Securities. Until so exchanged, the temporary Securities
shall in all respects be entitled to the same benefits under this Indenture as
permanent Securities authenticated and delivered hereunder.
SECTION 2.11. Cancellation.
------------
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for transfer, exchange or payment. The
Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent
(other than the Company or an Affiliate of the Company), and no one else, shall
cancel and, at the written direction of the Company, shall dispose of all
Securities surrendered for transfer, exchange, payment or cancellation. Subject
to Section 2.7, the Company may not issue new Securities to replace Securities
that have been paid or delivered to the Trustee for cancellation. No Securities
shall be authenticated in lieu of or in exchange for any Securities cancelled as
provided in this Section 2.11, except as expressly permitted in the form of
Securities and as permitted by this Indenture.
SECTION 2.12. Defaulted Interest.
------------------
Interest on any Security which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the person in
whose name that Security (or one or more predecessor Securities) is regis-
25
<PAGE>
tered at the close of business on the Record Date for such interest.
Any interest on any Security which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date plus, to the extent
lawful, any interest payable on the defaulted interest (herein called "Defaulted
Interest") shall forthwith cease to be payable to the registered holder on the
relevant Record Date, 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 (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 and the date of the
proposed payment, and at the same time the Company shall deposit with
the Trustee an amount of Cash 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 Cash when deposited to be held in
trust for the benefit of the persons entitled to such Defaulted
Interest as provided in this clause (1). 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 at his address as it appears in the Security register not
less than 10 days prior to such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record
Date therefor having been mailed as aforesaid, such Defaulted Interest
shall be paid to the persons in whose names the Securities (or their
respective predecessor Securities)
26
<PAGE>
are registered 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
in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the 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 shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section 2.12, each
Security delivered under this Indenture upon 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.
ARTICLE III
REDEMPTION
SECTION 3.1. Right of Redemption.
-------------------
Redemption of Securities, as permitted by any provision of this
Indenture, shall be made in accordance with Paragraph 5 of the Securities and
this Article III. The Company will not have the right to redeem any Securities
prior to September 23, 1998. On or after September 23, 1998, the Company will
have the right to redeem all or any part of the Securities at the Redemption
Prices specified in Paragraph 5 therein under the caption "Redemption," in each
case including accrued and unpaid interest to the Redemption Date.
SECTION 3.2. Notices to Trustee.
------------------
If the Company elects to redeem Securities pursuant to Paragraph 5 of
the Securities, it shall notify the Trustee in writing of the Redemption Date
and the principal amount of Securities to be redeemed and whether it wants the
Trustee to give notice of redemption to the Holders.
If the Company elects to reduce the principal amount of Securities to
be redeemed pursuant to Paragraph 5 of the Securities by crediting against any
such redemption Securities it has not previously delivered to the Trustee
27
<PAGE>
for cancellation, it shall so notify the Trustee of the amount of the reduction
and deliver such Securities with such notice.
The Company shall give each notice to the Trustee provided for in this
Section 3.2 at least 45 days before the Redemption Date (unless a shorter notice
shall be satisfactory to the Trustee). Any such notice may be cancelled at any
time prior to notice of such redemption being mailed to any Holder and shall
thereby be void and of no effect.
SECTION 3.3. Selection of Securities to Be Redeemed.
--------------------------------------
If less than all of the Securities are to be redeemed pursuant to
Paragraph 5 thereof, the Trustee shall select the Securities to be redeemed on a
pro rata basis, by lot or by such other method as the Trustee shall determine to
be fair and appropriate and in such manner as complies with any applicable
depositary, legal and stock exchange requirements.
The Trustee shall make the selection from the Securities outstanding
and not previously called for redemption and shall promptly notify the Company
in writing of the Securities selected for redemption and, in the case of any
Security selected for partial redemption, the principal amount thereof to be
redeemed. Securities in denominations of $1,000 may be redeemed only in whole.
The Trustee may select for redemption portions (equal to $1,000 or any integral
multiple thereof) of the principal of Securities that have denominations larger
than $1,000. Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption.
SECTION 3.4. Notice of Redemption.
--------------------
At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first-class mail, postage
prepaid, to the Trustee and each Holder whose Securities are to be redeemed. At
the Company's request, the Trustee shall give the notice of redemption in the
Company's name and at the Company's expense. Each notice for redemption shall
identify the Securities to be redeemed and shall state:
28
<PAGE>
(1) the Redemption Date, and that the Securities called for
redemption may not be converted after the fifth Business Day prior to
the Redemption Date;
(2) the Redemption Price, including the amount of accrued
and unpaid interest and Liquidated Damages, if any, to be paid upon
such redemption;
(3) the name, address and telephone number of the Paying
Agent;
(4) that Securities called for redemption must be
surrendered to the Paying Agent at the address specified in such
notice to collect the Redemption Price;
(5) that, unless (a) the Company defaults in its obligation
to deposit Cash with the Paying Agent in accordance with Section 3.6
hereof or (b) such redemption payment is prohibited pursuant to
Article XII hereof or otherwise, interest on, and Liquidated Damages
with respect to, Securities called for redemption ceases to accrue on
and after the Redemption Date and the only remaining right of the
Holders of such Securities is to receive payment of the Redemption
Price, including accrued and unpaid interest and Liquidated Damages,
if any, to the Redemption Date, upon surrender to the Paying Agent of
the Securities called for redemption and to be redeemed;
(6) if any Security is being redeemed in part, the portion
of the principal amount, equal to $1,000 or any integral multiple
thereof, of such Security to be redeemed and that, after the
Redemption Date, and upon surrender of such Security, a new Security
or Securities in aggregate principal amount equal to the unredeemed
portion thereof will be issued;
(7) if less than all the Securities are to be redeemed, the
identification of the particular Securities (or portion thereof) to be
redeemed, as well as the aggregate principal amount of such Securities
to be redeemed and the aggregate principal amount of Securities to be
outstanding after such partial redemption;
29
<PAGE>
(8) the CUSIP number of the Securities to be redeemed; and
(9) that the notice is being sent pursuant to this Section
3.4 and pursuant to the redemption provisions of Paragraph 5 of the
Securities.
SECTION 3.5. Effect of Notice of Redemption.
------------------------------
Once notice of redemption is mailed in accordance with Section 3.4,
Securities called for redemption become due and payable on the Redemption Date
and at the Redemption Price, including accrued and unpaid interest and
Liquidated Damages, if any, to the Redemption Date. Upon surrender to the
Trustee or Paying Agent, such Securities called for redemption shall be paid at
the Redemption Price, including accrued and unpaid interest and Liquidated
Damages, if any, to the Redemption Date; provided that if the Redemption Date is
--------
after a regular Record Date and on or prior to the corresponding Interest
Payment Date or Damage Payment Date, the accrued interest and Liquidated
Damages, if any, shall be payable to the Holder of the redeemed Securities
registered on the relevant Record Date; and provided, further, that if a
-------- -------
Redemption Date is a Legal Holiday, payment shall be made on the next succeeding
Business Day and no interest or Liquidated Damages shall accrue for the period
from such Redemption Date to such succeeding Business Day.
SECTION 3.6. Deposit of Redemption Price.
---------------------------
On or prior to the Redemption Date, the Company shall deposit with the
Paying Agent (other than the Company or an Affiliate of the Company) Cash
sufficient to pay the Redemption Price of, including accrued and unpaid interest
on, and Liquidated Damages with respect to, all Securities to be redeemed on
such Redemption Date (other than Securities or portions thereof called for
redemption on that date that have been delivered by the Company to the Trustee
for cancellation). The Paying Agent shall promptly return to the Company any
Cash so deposited which is not required for that purpose upon the written
request of the Company.
If the Company complies with the preceding paragraph and the other
provisions of this Article III and payment of the Securities called for
redemption is not prohibited under Article XII or otherwise, interest and
30
<PAGE>
Liquidated Damages on the Securities to be redeemed will cease to accrue on the
applicable Redemption Date, whether or not such Securities are presented for
payment. Notwithstanding anything herein to the contrary, if any Security
surrendered for redemption in the manner provided in the Securities shall not be
so paid upon surrender for redemption because of the failure of the Company to
comply with the preceding paragraph, Liquidated Damages shall continue to accrue
and be paid from the Redemption Date in accordance with Section 3 of the
Registration Rights Agreement and interest shall continue to accrue and be paid
from the Redemption Date until such payment is made on the unpaid principal,
and, to the extent lawful, on any interest not paid on such unpaid principal, in
each case at the rate and in the manner provided in Section 4.1 hereof and the
Security.
SECTION 3.7. Securities Redeemed in Part.
---------------------------
Upon surrender of a Security that is to be redeemed in part, the
Company shall execute and the Trustee shall authenticate and deliver to the
Holder, without service charge to the Holder, a new Security or Securities equal
in principal amount to the unredeemed portion of the Security surrendered.
ARTICLE IV
COVENANTS
SECTION 4.1. Payment of Securities.
---------------------
The Company shall pay the principal of, interest on, and Liquidated
Damages with respect to, the Securities on the dates and in the manner provided
in the Securities and the Registration Rights Agreement, as applicable. An
installment of principal of, interest on, or Liquidated Damages with respect to,
the Securities shall be considered paid on the date it is due if the Trustee or
Paying Agent (other than the Company or an Affiliate of the Company) holds for
the benefit of the Holders, on or before 10:00 a.m. New York City time on that
date, Cash deposited and designated for and sufficient to pay the installment.
The Company shall pay interest on overdue principal and on overdue
installments of interest at the rate
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specified in the Securities compounded semi-annually, to the extent lawful.
SECTION 4.2. Maintenance of Office or Agency.
-------------------------------
The Company shall maintain in the Borough of Manhattan, The City of
New York, an office or agency where Securities may be presented or surrendered
for payment, where Securities may be surrendered for registration of transfer or
exchange and for conversion and where notices and demands to or upon the Company
in respect of the Securities and this Indenture may be served. The Company
shall give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. If at any time the Company shall
fail to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the address of the Trustee set forth in Section
14.2.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
- -------- -------
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby initially designates the corporate trust office of the
Trustee as such office.
SECTION 4.3. Corporate Existence.
-------------------
Subject to Article V, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and the corporate or other existence of each of its Subsidiaries in
accordance with the respective organizational documents of each of them and the
rights (charter and statutory) and corporate franchises of the Company and each
of its Subsidiaries; provided, however, that the Company shall not be required
-------- -------
to preserve, with respect to itself, any right or franchise, and with respect to
any of its Subsidiaries, any such existence, right or franchise, if (a) the
Company shall
32
<PAGE>
determine that the preservation thereof is no longer desirable in the conduct of
the business of such entity and (b) the loss thereof is not disadvantageous in
any material respect to the Holders.
SECTION 4.4. Payment of Taxes and Other Claims.
---------------------------------
Except with respect to immaterial items, the Company shall, and shall
cause each of its Subsidiaries to, pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (i) all taxes, assessments
and governmental charges (including withholding taxes and any penalties,
interest and additions to taxes) levied or imposed upon the Company or any of
its Subsidiaries or any of their respective properties and assets and (ii) all
lawful claims, whether for labor, materials, supplies, services or anything
else, which have become due and payable and which by law have or may become a
Lien upon the property and assets of the Company or any of its Subsidiaries;
provided, however, that neither the Company nor any Subsidiary shall be required
- -------- -------
to pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate proceedings and for which disputed amounts adequate
reserves have been established in accordance with GAAP.
SECTION 4.5. Maintenance of Properties and Insurance.
---------------------------------------
The Company shall cause all material properties used or useful to the
conduct of its business and the business of each of its Subsidiaries to be
maintained and kept in good condition, repair and working order (reasonable wear
and tear excepted) and supplied with all necessary equipment and shall cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in their reasonable judgment may be necessary, so
that the business carried on in connection therewith may be properly conducted
at all times; provided, however, that nothing in this Section 4.5 shall prevent
-------- -------
the Company or any Subsidiary from discontinuing any operation or maintenance of
any of such properties, or disposing of any of them, if such discontinuance or
disposal is (a), in the judgment of the Company, desirable in the conduct of the
business of such entity and (b) not disadvantageous in any material respect to
the Holders.
33
<PAGE>
The Company shall provide, or cause to be provided, for itself and
each of its Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds that, in the reasonable, good faith opinion
of the Company is adequate and appropriate for the conduct of the business of
the Company and such Subsidiaries in a prudent manner, with (except for self-
insurance) reputable insurers or with the government of the United States of
America or an agency or instrumentality thereof, in such amounts, with such
deductibles, and by such methods as shall be customary, in the reasonable, good
faith opinion of the Company and adequate and appropriate for the conduct of the
business of the Company and such Subsidiaries in a prudent manner for entities
similarly situated in the industry, unless failure to provide such insurance
(together with all other such failures) would not have a material adverse effect
on the financial condition or results of operations of the Company or such
Subsidiary.
SECTION 4.6. Compliance Certificate; Notice of Default.
-----------------------------------------
(a) The Company shall deliver to the Trustee within 120 days
after the end of its fiscal year an Officers' Certificate complying with Section
314(a)(4) of the TIA and stating that a review of its activities and the
activities of its Subsidiaries during the preceding fiscal year has been made
under the supervision of the signing Officers with a view to determining whether
the Company has kept, observed, performed and fulfilled its obligations under
this Indenture and further stating, as to each such Officer signing such
certificate, whether or not the signer knows of any failure by the Company or
any Subsidiary of the Company to comply with any conditions or covenants in this
Indenture and, if such signor does know of such a failure to comply, the
certificate shall describe such failure with particularity. The Officers'
Certificate shall also notify the Trustee should the relevant fiscal year end on
any date other than the current fiscal year end date.
(b) The Company shall, so long as any of the Securities are
outstanding, deliver to the Trustee, promptly upon becoming aware of any
Default, Event of Default or fact which would prohibit the making of any payment
to or by the Trustee in respect of the Securities, an Officers' Certificate
specifying such Default, Event of Default or fact and what action the Company is
taking or proposes to take with
34
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respect thereto. The Trustee shall not be deemed to have knowledge of any
Default, any Event of Default or any such fact unless one of its Trust Officers
receives notice thereof from the Company or any of the Holders.
SECTION 4.7. Reports.
-------
Whether or not the Company is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, the Company shall deliver to the
Trustee and to each Holder and to prospective purchasers of Securities
identified to the Company by a Purchaser, within 15 days after it is or would
have been required to file such with the SEC, annual and quarterly consolidated
financial statements substantially equivalent to financial statements that would
have been included in reports filed with the SEC if the Company was subject to
the requirements of Section 13 or 15(d) of the Exchange Act, including, with
respect to annual information only, a report thereon by the Company's certified
independent public accountants as such would be required in such reports to the
SEC and, in each case, together with a management's discussion and analysis of
financial condition and results of operations which would be so required.
SECTION 4.8. Limitation on Status as Investment Company.
------------------------------------------
Neither the Company nor any of its Subsidiaries shall become an
"investment company" (as that term is defined in the Investment Company Act of
1940, as amended), or otherwise become subject to regulation under the
Investment Company Act.
SECTION 4.9. Waiver of Stay, Extension or Usury Laws.
---------------------------------------
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law or any usury law or
other law which would prohibit or forgive the Company from paying all or any
portion of the principal of, premium of, interest on, or Liquidated Damages with
respect to, the Securities as contemplated herein, wherever enacted, now or at
any time hereafter in force, or which may affect the covenants or the
performance of this Indenture; and (to the
35
<PAGE>
extent that it may lawfully do so) the Company hereby expressly waives all
benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.
SECTION 4.10. Rule 144A Information Requirement.
---------------------------------
The Company shall furnish to the Holders or beneficial holders of the
Securities or the underlying Common Stock and prospective purchasers of
Securities or the underlying Common Stock designated by the Holders of Transfer
Restricted Securities, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act until such time
as the Company concluded a registration statement relating to resales of the
Securities has become effective under the Securities Act. The Company shall
also furnish such information during the pendency of any suspension of
effectiveness of the resale registration statement.
ARTICLE V
SUCCESSOR CORPORATION
SECTION 5.1. Limitation on Merger, Sale or Consolidation.
-------------------------------------------
(a) The Company shall not, directly or indirectly, consolidate
with or merge with or into another Person or sell, lease, convey or transfer all
or substantially all of its assets (computed on a consolidated basis), whether
in a single transaction or a series of related transactions, to another Person
or group of affiliated Persons, unless (i) either (a) in the case of a merger or
consolidation, the Company is the surviving entity or (b) the resulting,
surviving or transferee entity is a corporation organized under the laws of the
United States, any state thereof or the District of Columbia and expressly
assumes by supplemental indenture all of the obligations of the Company in
connection with the Securities and the Indenture; (ii) no Default or Event of
Default shall exist or shall occur immediately before or after giving effect on
a pro forma basis to such transaction; and (iii) the Company
--- -----
36
<PAGE>
has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger or transfer and, if a supplemental
indenture is required, such supplemental indenture comply with the Indenture and
that all conditions precedent relating to such transactions have been satisfied.
(b) For purposes of clause (a) of this Section 5.1, the sale,
lease, conveyance, assignment, transfer, or other disposition of all or
substantially all of the properties and assets of one or more Subsidiaries of
the Company, which properties and assets, if held by the Company instead of such
Subsidiaries, would constitute all or substantially all of the properties and
assets of the Company on a consolidated basis, shall be deemed to be the
transfer of all or substantially all of the properties and assets of the
Company.
SECTION 5.2. Successor Corporation Substituted.
---------------------------------
Upon any consolidation or merger or any sale, lease, conveyance or
transfer of all or substantially all of the assets of the Company in accordance
with the foregoing, the successor corporation formed by such consolidation or
into which the Company is merged or to which such sale, lease, conveyance or
transfer is made, shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under the Indenture with the same effect
as if such successor corporation had been named therein as the Company, and when
a successor corporation duly assumes all of the obligations of the Company
pursuant hereto and pursuant to the Securities, the predecessor shall be
released from such obligations (except with respect to any obligations that
arise from or as a result of such transaction).
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES
SECTION 6.1. Events of Default.
-----------------
"Event of Default," wherever used herein, means any one of the following
events (whatever the reason for such Event of Default and whether it shall be
caused voluntarily or involuntarily or effected, without limitation, by
operation of law or pursuant to any judgment, decree or order of any
37
<PAGE>
court or any order, rule or regulation of any administrative or governmental
body):
(1) failure to pay any installment of interest on, or
Liquidated Damages with respect to, the Securities as and when the
same becomes due and payable, or to perform any conversion of the
Securities required under this Indenture, and the continuance of such
default for a period of 30 days, whether or not such payment is
prohibited by Article XII;
(2) failure to pay all or any part of the principal of, or
premium, if any on the Securities when and as the same become due and
payable at maturity, redemption, by acceleration or otherwise,
including, without limitation, default in the payment of the
Repurchase Price on the Repurchase Date in accordance with Article XI,
whether or not such payment is prohibited by Article XII;
(3) failure by the Company to observe or perform any covenant,
agreement or warranty contained in the Securities or this Indenture
(other than a default in the performance of any covenant, agreement or
warranty which is specifically dealt with elsewhere in this Section
6.1), and continuance of such failure for a period of 60 days after
there has been given, by registered or certified mail, to the Company
by the Trustee, or to the Company and the Trustee by Holders of at
least 25% in aggregate principal amount of the then outstanding
Securities, a written notice specifying such default or breach,
requesting it to be remedied and stating that such notice is a "Notice
of Default" hereunder;
(4) a default under Indebtedness of the Company or any of its
Subsidiaries with an aggregate principal amount in excess of
$15,000,000 (a) resulting from the failure to pay principal, premium
or interest when due that extends beyond any stated period of grace
applicable thereto or (b) as a result of which the maturity of such
Indebtedness has been accelerated prior to its stated maturity;
(5) a decree, judgment, or order by a court of competent
jurisdiction shall have been entered adjudging the Company or any of
its Subsidiaries as bank-
38
<PAGE>
rupt or insolvent, or approving as properly filed a petition seeking
reorganization of the Company or any of its Subsidiaries under any
bankruptcy or similar law, and such decree or order shall have
continued undischarged and unstayed for a period of 75 days; or a
decree or order of a court of competent jurisdiction over the
appointment of a receiver, liquidator, trustee, or assignee in
bankruptcy or insolvency of the Company, any of its Subsidiaries, or
of the property of any such Person, or for the winding up or
liquidation of the affairs of any such Person, shall have been
entered, and such decree, judgment, or order shall have remained in
force undischarged and unstayed for a period of 60 days;
(6) the Company or any of its Subsidiaries shall institute
proceedings to be adjudicated a voluntary bankrupt, or shall consent
to the filing of a bankruptcy proceeding against it, or shall file a
petition or answer or consent seeking reorganization under any
bankruptcy or similar law or similar statute, or shall consent to the
filing of any such petition, or shall consent to the appointment of a
Custodian, receiver, liquidator, trustee, or assignee in bankruptcy or
insolvency of it or any of its assets or property, or shall make a
general assignment for the benefit of creditors, or shall admit in
writing its inability to pay its debts generally as they become due,
or shall, within the meaning of any Bankruptcy Law, become insolvent,
fail generally to pay its debts as they become due, or take any
corporate action in furtherance of or to facilitate, conditionally or
otherwise, any of the foregoing; or
(7) final unsatisfied judgments not covered by insurance, or
the issuance of any warrant of attachment against any portion of the
property or assets of the Company or any of its Subsidiaries,
aggregating in excess of $15,000,000 at any one time shall have been
rendered against the Company or any of its Subsidiaries and not have
been stayed, bonded or discharged for a period (during which execution
shall not be effectively stayed) of 75 days (or, in the case of any
such final judgment which provides for payment over time, which shall
so remain unstayed, unbonded or undischarged beyond any applicable
payment date provided therein).
39
<PAGE>
Notwithstanding the 60-day period and notice requirement contained in
Section 6.1(3) above, with respect to a default under Article XI the 60-day
period referred to in Section 6.1(3) shall be deemed to have begun as of the
date the Change of Control notice is required to be sent in the event that the
Company has not complied with the provisions of Section 11.1 and the Trustee or
Holders of at least 25% in principal amount of the outstanding Securities
thereafter give the Notice of Default referred to in Section 6.1(3) to the
Company and, if applicable, the Trustee; provided, however, that if the breach
-------- -------
or default is a result of a default in the payment when due of the Repurchase
Price on the Repurchase Date, such Event of Default shall be deemed, for
purposes of this Section 6.1, to arise no later than on the Final Repurchase
Payment Date.
If a Default occurs and is continuing, the Trustee shall, within 90
days after the occurrence of such default, give to the Holders notice of such
default.
SECTION 6.2. Acceleration of Maturity Date; Rescission and Annulment.
-------------------------------------------------------
If an Event of Default (other than an Event of Default specified in
Section 6.1(5) or (6) relating to the Company or any of its Subsidiaries) occurs
and is continuing, then, and in every such case, unless the principal of all of
the Securities shall have already become due and payable, either the Trustee or
the Holders of not less than 25% in aggregate principal amount of then
outstanding Securities, by a notice in writing to the Company (and to the
Trustee if given by Holders) (an "Acceleration Notice"), may declare all of the
principal of the Securities (or the Repurchase Price if the Event of Default
includes failure to pay the Repurchase Price, determined as set forth below),
including in each case accrued interest thereon and Liquidated Damages with
respect thereto, to be due and payable immediately. If an Event of Default
specified in Section 6.1(5) or (6) relating to the Company or any Subsidiary
occurs, all principal, accrued interest thereon and Liquidated Damages with
respect thereto will be immediately due and payable on all outstanding
Securities without any declaration or other act on the part of Trustee or the
Holders.
At any time after such a declaration of acceleration has been made and
before a judgment or decree for pay-
40
<PAGE>
ment of the money due has been obtained by the Trustee as hereinafter provided
in this Article VI, the Holders of no less than a majority in aggregate
principal amount of then outstanding Securities, by written notice to the
Company and the Trustee, may rescind, on behalf of all Holders, any such
declaration of acceleration if:
(1) the Company has paid or deposited with the Trustee Cash
sufficient to pay
(A) all overdue interest on, and Liquidated Damages with
respect to, all Securities,
(B) the principal of (and premium, if any, applicable to)
any Securities which would then be due otherwise than by such
declaration of acceleration, and interest thereon at the rate
borne by the Securities ,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest and Liquidated Damages at the
rate borne by the Securities,
(D) all sums paid or advanced by the Trustee hereunder and
the compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and
(2) all Events of Default, other than the non-payment of the
principal of, premium, if any, interest on and Liquidated Damages with
respect to Securities that have become due solely by such declaration
of acceleration, have been cured or waived as provided in Section
6.12, including, if applicable, any Event of Default relating to the
covenants contained in Section 11.1.
Notwithstanding the previous sentence of this Section 6.2, no waiver shall be
effective against any Holder for any Event of Default or event which with notice
or lapse of time or both would be an Event of Default with respect to any
covenant or provision which cannot be modified or amended
41
<PAGE>
without the consent of the Holder of each outstanding Security affected thereby,
unless all such affected Holders agree, in writing, to waive such Event of
Default or other event. No such waiver shall cure or waive any subsequent
Default or Event of Default or impair any right consequent thereon.
SECTION 6.3. Collection of Indebtedness and Suits for Enforcement by
-------------------------------------------------------
Trustee.
- -------
The Company covenants that if an Event of Default in payment of
principal, premium, interest or Liquidated Damages specified in clause (1) or
(2) of Section 6.1 occurs and is continuing, the Company shall, upon demand of
the Trustee, pay to it, for the benefit of the Holders of such Securities, the
whole amount then due and payable on such Securities for principal, premium (if
any), interest, Liquidated Damages and, to the extent that payment of such
interest shall be legally enforceable, interest on any overdue principal (and
premium, if any), Liquidated Damages and on any overdue interest, at the rate
borne by the Securities, and, in addition thereto, such further amount as shall
be sufficient to cover the costs and expenses of collection, including
compensation to, and expenses, disbursements and advances of the Trustee, its
agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust in favor of the
Holders, may institute a judicial proceeding for the collection of the sums so
due and unpaid, may prosecute such proceeding to judgment or final decree and
may enforce the same against the Company or any other obligor upon the
Securities and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of the Company or any other obligor
upon the Securities, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effective to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
42
<PAGE>
SECTION 6.4. Trustee May File Proofs of Claim.
--------------------------------
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal, interest or Liquidated
Damages) shall be entitled and empowered, by intervention in such proceeding or
otherwise to take any and all actions under the TIA, including
(1) to file and prove a claim for the whole amount of principal
(and premium, if any), interest and Liquidated Damages owing and unpaid in
respect of the Securities and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee (including any
claim for the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agent and counsel) and of the Holders allowed in such judicial
proceeding, and
(2) to collect and receive any moneys or other property payable
or deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment, or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
43
<PAGE>
SECTION 6.5. Trustee May Enforce Claims Without Possession of
------------------------------------------------
Securities.
- ----------
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust in favor of the Holders, and any recovery of
judgment shall, after provision for the payment of compensation to, and
expenses, disbursements and advances of the Trustee, its agents and counsel, be
for the ratable benefit of the Holders of the Securities in respect of which
such judgment has been recovered.
SECTION 6.6. Priorities.
----------
Any money collected by the Trustee pursuant to this Article VI shall
be applied in the following order, at the date or dates fixed by the Trustee
and, in case of the distribution of such money on account of principal, premium
(if any), interest or Liquidated Damages, upon presentation of the Securities
and the notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:
FIRST: To the Trustee in payment of all amounts due pursuant to
Section 7.7;
SECOND: To the holders of Senior Indebtedness of the Company to the
extent provided in Article XII;
THIRD: To the Holders in payment of the amounts then due and unpaid
for principal of, premium (if any), interest on and Liquidated Damages with
respect to, the Securities in respect or for the benefit of which such money has
been collected, ratably, without preference or priority of any kind, according
to the amounts due and payable on such Securities for principal, premium (if
any), interest and Liquidated Damages, respectively; and
FOURTH: To whomsoever may be lawfully entitled thereto, the
remainder, if any.
44
<PAGE>
SECTION 6.7. Limitation on Suits.
-------------------
No Holder of any Security shall have any right to order or direct the
Trustee to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(A) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(B) the Holders of not less than 25% in principal amount of
then outstanding Securities shall have made written request to the
Trustee to institute proceedings in respect of such Event of Default
in its own name as Trustee hereunder;
(C) such Holder or Holders have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities to be incurred or reasonably probable to be incurred in
compliance with such request;
(D) the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute any
such proceeding; and
(E) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of
a majority in principal amount of then outstanding Securities;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
45
<PAGE>
SECTION 6.8. Unconditional Right of Holders to Receive Principal,
----------------------------------------------------
Premium, Interest and Liquidated Damages.
- ----------------------------------------
Notwithstanding any other provision of this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of, and premium (if any), interest on and
Liquidated Damages with respect to, such Security when due (including, in the
case of redemption, the Redemption Price on the applicable Redemption Date, and
in the case of the Repurchase Price, on the applicable Repurchase Date) and to
institute suit for the enforcement of any such payment after such respective
dates, and such rights shall not be impaired without the consent of such Holder.
SECTION 6.9. Rights and Remedies Cumulative.
------------------------------
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in Section 2.7, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.10. Delay or Omission Not Waiver.
----------------------------
No delay or omission by the Trustee or by any Holder of any Security
to exercise any right or remedy arising upon any Event of Default shall impair
the exercise of any such right or remedy or constitute a waiver of any such
Event of Default. Every right and remedy given by this Article VI or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
SECTION 6.11. Control by Holders.
------------------
The Holder or Holders of no less than a majority in aggregate
principal amount of then outstanding Securities shall have the right to direct
the time, method and place of
46
<PAGE>
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred upon the Trustee, provided, that
--------
(1) such direction shall not be in conflict with any rule of
law or with this Indenture,
(2) the Trustee shall not determine that the action so directed
would be unjustly prejudicial to the Holders not taking part in such
direction, and
(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 6.12. Waiver of Past Default.
----------------------
Subject to Section 6.8, the Holder or Holders of not less than a
majority in aggregate principal amount of then outstanding Securities may, on
behalf of all Holders, prior to the declaration of acceleration of the maturity
of the Securities, waive any past default hereunder and its consequences, except
a default
(A) in the payment of the principal of, premium, if any,
interest on, or Liquidated Damages with respect to, any Security not
yet cured as specified in clauses (1) and (2) of Section 6.1, or
(B) in respect of a covenant or provision hereof which,
under Article IX, cannot be modified or amended without the consent of
the Holder of each outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair the exercise of any right arising therefrom.
SECTION 6.13. Undertaking for Costs.
---------------------
All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or
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remedy under this Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted to be taken 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 6.13 shall not apply to any suit instituted
by the Company, to any suit instituted by the Trustee, to any suit instituted by
any Holder, or group of Holders, holding in the aggregate more than 10% in
aggregate principal amount of then outstanding Securities, or to any suit
instituted by any Holder for enforcement of the payment of principal of, premium
(if any), interest on or Liquidated Damages with respect to, any Security on or
after the respective Stated Maturity of such Security (including, in the case of
redemption, on or after the Redemption Date).
SECTION 6.14. Restoration of Rights and Remedies.
----------------------------------
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
ARTICLE VII
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture
and covenants and agrees to perform the same, as herein expressed.
SECTION 7.1. Duties of Trustee.
-----------------
(a) If a Default or an Event of Default has occurred and is
continuing, the Trustee shall exercise such
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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 Person would exercise or use
under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of a Default or an Event of
Default:
(1) The Trustee need perform only those duties as are
specifically set forth in this Indenture and no others, and no
covenants or obligations shall be implied in or read into this
Indenture which are adverse to the Trustee.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine the certificates
and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b)
of this Section 7.1.
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.11.
(d) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or to take or omit to take any action
under this Indenture or at the request, order or direction of the Holders or in
the exercise of any of its
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<PAGE>
rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b), (c), (d) and (f) of this
Section 7.1.
(f) The Trustee shall not be liable for interest on any assets
received by it except as the Trustee may agree in writing with the Company.
Assets held in trust by the Trustee need not be segregated from other assets
except to the extent required by law.
SECTION 7.2. Rights of Trustee.
-----------------
Subject to Section 7.1:
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper Person. The Trustee
need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
consult with counsel and may require an Officers' Certificate or an Opinion of
Counsel, which shall conform to Sections 14.4 and 14.5. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such certificate or advice of counsel.
(c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers conferred upon it by this Indenture.
(e) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may
see fit.
50
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(f) 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 Holders, pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
(g) Unless otherwise specifically provided for in this
Indenture, any demand, request, direction or notice from the Company shall be
sufficient if signed by an Officer of the Company.
(h) The Trustee shall have no duty to inquire as to the
performance of the Company's covenants in Article IV hereof. In addition, the
Trustee shall not be deemed to have knowledge of any Default or Event of Default
except (i) any Event of Default occurring pursuant to Sections 6.1(1), 6.1(2) or
5.1, or (ii) any Default or Event of Default of which the Trustee shall have
received written notification or obtained actual knowledge.
SECTION 7.3. Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company, any of
its Subsidiaries, or their respective Affiliates with the same rights it would
have if it were not Trustee. Any Agent may do the same with like rights.
However, the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.4. Trustee's Disclaimer.
--------------------
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities and it shall not be accountable for the
Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement in the Securities, other than the Trustee's
certificate of authentication, or the use or application of any funds received
by a Paying Agent other than the Trustee.
SECTION 7.5. Notice of Default.
-----------------
If a Default or an Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee
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shall mail to each Securityholder notice of the uncured Default or Event of
Default within 90 days after such Default or Event of Default occurs. Except in
the case of a Default or an Event of Default in payment of principal (or
premium, if any) of, interest on or Liquidated Damages with respect to, any
Security (including the payment of the Repurchase Price on the Repurchase Date
and the payment of the Redemption Price on the Redemption Date), the Trustee may
withhold the notice if and so long as a Trust Officer in good faith determines
that withholding the notice is in the interest of the Securityholders.
SECTION 7.6. Reports by Trustee to Holders.
-----------------------------
Within 60 days after each July 15 beginning with the July 15 following
the date of this Indenture, the Trustee shall, if required by law, mail to each
Securityholder a brief report dated as of such July 15 that complies with TIA
(S) 313(a). The Trustee also shall comply with TIA (S)(S) 313(b) and 313(c).
The Company shall promptly notify the Trustee in writing if the
Securities become listed on any stock exchange or automatic quotation system.
A copy of each report at the time of its mailing to Securityholders
shall be mailed to the Company and filed with the SEC and each stock exchange,
if any, on which the Securities are listed.
SECTION 7.7. Compensation and Indemnity.
--------------------------
The Company agrees to pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances incurred or made by it. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents, accountants,
experts and counsel.
The Company agrees to indemnify the Trustee (in its capacity as
Trustee) and each of its officers, directors, attorneys-in-fact and agents for,
and hold it harmless against, any claim, demand, expense (including but not
limited to reasonable compensation, disbursements and ex-
52
<PAGE>
penses of the Trustee's agents and counsel), loss or liability incurred by it
without negligence or bad faith on its part, arising out of or in connection
with the administration of this trust and its rights or duties hereunder
including the reasonable costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder. The Trustee shall notify the Company promptly of any
claim asserted against the Trustee for which it may seek indemnity. The Company
shall defend the claim and the Trustee shall provide reasonable cooperation at
the Company's expense in the defense. The Trustee may have separate counsel and
the Company shall pay the reasonable fees and expenses of such counsel;
provided, that the Company will not be required to pay such fees and expenses if
- --------
it assumes the Trustee's defense and there is no conflict of interest between
the Company and the Trustee in connection with such defense. The Company need
not pay for any settlement made without its written consent. The Company need
not reimburse any expense or indemnify against any loss or liability to the
extent incurred by the Trustee through its negligence, bad faith or willful
misconduct.
To secure the Company's payment obligations in this Section 7.7, the
Trustee shall have a lien prior to the Securities on all assets held or
collected by the Trustee, in its capacity as Trustee, except assets held in
trust to pay principal and premium, if any, of or interest on particular
Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(5) or (6) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
The Company's obligations under this Section 7.7 and any lien arising
hereunder shall survive the resignation or removal of the Trustee, the discharge
of the Company's obligations pursuant to Article VIII of this Indenture and any
rejection or termination of this Indenture under any Bankruptcy Law.
SECTION 7.8. Replacement of Trustee.
----------------------
The Trustee may resign by so notifying the Company in writing. The
Holder or Holders of a majority in princi-
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pal amount of then outstanding Securities may remove the Trustee by so notifying
the Company and the Trustee in writing and may appoint a successor trustee with
the Company's consent. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged bankrupt or insolvent;
(c) a receiver, Custodian, or other public officer takes charge
of the Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holder
or Holders of a majority in principal amount of then outstanding Securities may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that
and provided that all sums owing to the retiring Trustee provided for in Section
7.7 have been paid, the retiring Trustee shall transfer all property held by it
as trustee to the successor Trustee, subject to the lien provided in Section
7.7, the resignation or removal of the retiring Trustee shall become effective,
and the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. A successor Trustee shall mail notice of its
succession to each Holder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holder or Holders of at least 10% in principal amount of then outstanding
Securities may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
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Notwithstanding replacement of the Trustee pursuant to this Section
7.8, the Company's obligations under Section 7.7 shall continue for the benefit
of the retiring Trustee.
SECTION 7.9. Successor Trustee by Merger, Etc.
---------------------------------
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee.
SECTION 7.10. Eligibility; Disqualification.
-----------------------------
The Trustee shall at all times satisfy the requirements of TIA (S)
310(a)(1), (2) and (5). The Trustee shall have a combined capital and surplus
of at least $100,000,000 as set forth in its most recent published annual report
of condition. The Trustee shall comply with TIA (S) 310(b).
SECTION 7.11. Preferential Collection of Claims Against Company.
-------------------------------------------------
The Trustee shall comply with TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated.
ARTICLE VIII
SATISFACTION AND DISCHARGE
SECTION 8.1. Satisfaction and Discharge of Indenture.
---------------------------------------
The Company may terminate its obligations under this Indenture
(subject to the provisions of this Article VIII) when it shall have delivered to
the Trustee for cancellation all Securities theretofore authenticated (other
than any Securities which shall have been destroyed, lost or stolen and which
shall have been replaced or paid as
55
<PAGE>
provided in Article II hereof) and the following conditions shall be satisfied:
(1) The Company has paid all sums payable under the Indenture;
and
(2) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel in the United States, each
stating that all conditions precedent have been complied with as contemplated by
this Section 8.1.
SECTION 8.2. Repayment to the Company.
------------------------
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, for the payment of the principal of, premium, if any, interest
on or Liquidated Damages with respect to any Security and remaining unclaimed
for two years after such principal, premium, if any, interest or Liquidated
Damages has become due and payable shall be paid to the Company on its request;
and the Holder of such Security shall thereafter look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money shall thereupon cease.
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.1. Supplemental Indentures Without Consent of Holders.
--------------------------------------------------
Without the consent of any Holder, the Company, when authorized by
Board Resolutions, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to cure any ambiguity, defect, or inconsistency, or to make
any other provisions with respect to matters or questions arising under this
Indenture which shall not be inconsistent with the provisions of this Indenture,
provided, that such action pursuant to this clause (1) does not adversely affect
- --------
the interests of any Holder in any respect;
56
<PAGE>
(2) to create additional covenants of the Company for the
benefit of the Holders, or to surrender any right or power herein conferred upon
the Company or to make any other change that does not adversely affect the
rights of any Holder, provided, that the Company has delivered to the Trustee an
--------
Opinion of Counsel stating that such change pursuant to this clause (2) does not
adversely affect the rights of any Holder;
(3) to provide for collateral for or guarantors of the
Securities;
(4) to evidence the succession of another Person to the Company
and the assumption by any such successor of the obligations of the Company
herein and in the Securities in accordance with Article V; or
(5) to comply with the TIA.
SECTION 9.2. Amendments, Supplemental Indentures and Waivers with
----------------------------------------------------
Consent of Holders.
- ------------------
Subject to Section 6.8 and the last sentence of this paragraph, with
the consent of the Holders of not less than a majority in aggregate principal
amount of then outstanding Securities, by written act of said Holders delivered
to the Company and the Trustee, the Company, when authorized by Board
Resolutions, and the Trustee may amend or supplement this Indenture or the
Securities or enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Indenture or the Securities or of modifying in any
manner the rights of the Holders under this Indenture or the Securities. Subject
to Section 6.8 and the last sentence of this paragraph, the Holder or Holders of
not less than a majority in aggregate principal amount of then outstanding
Securities may, in writing, waive compliance by the Company with any provision
of this Indenture or the Securities. Notwithstanding any of the above, however,
no such amendment, supplemental indenture or waiver shall, without the consent
of the Holder of each outstanding Security affected thereby:
(1) change the Stated Maturity of any Security or reduce the
principal amount thereof or the rate (or extend the time for payment) of
interest thereon or any premium payable upon the redemption thereof, or change
the
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place of payment where, or the coin or currency in which, any Security or
any premium or the interest thereon or Liquidated Damages with respect thereto
is payable, or impair the right to institute suit for the enforcement of any
such payment or the conversion of any Security on or after the due date thereof
(including, in the case of redemption, on or after the Redemption Date), or
reduce the Repurchase Price, or alter the Repurchase Offer or redemption
provisions in a manner adverse to the Holders;
(2) reduce the percentage in principal amount of the
outstanding Securities, the consent of whose Holders is required for any such
amendment, supplemental indenture or waiver provided for in the Indenture;
(3) adversely affect the right of such Holder to convert
Securities; or
(4) modify any of the waiver provisions, except to increase any
required percentage or to provide that certain other provisions of the Indenture
cannot be modified or waived without the consent of the Holder of each
outstanding Security affected thereby.
It shall not be necessary for the consent of the Holders under this
Section 9.2 to approve the particular form of any proposed amendment, supplement
or waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.2
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. 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 or
waiver.
After an amendment, supplement or waiver under this Section 9.2 or
Section 9.4 becomes effective, it shall bind each Holder.
In connection with any amendment, supplement or waiver under this
Article IX, the Company may, but shall not be obligated to, offer to any Holder
who consents to such amendment, supplement or waiver, or (at the option of the
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Company) to all Holders, consideration for consent to such amendment, supplement
or waiver.
SECTION 9.3. Compliance with TIA.
-------------------
Every amendment, waiver or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
SECTION 9.4. Revocation and Effect of Consents.
---------------------------------
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of his Security by written notice to the
Company or the Person designated by the Company as the Person to whom consents
should be sent if such revocation is received by the Company or such Person
before the date on which the Trustee receives an Officers' Certificate
certifying that the Holders of the requisite principal amount of Securities have
consented (and not theretofore revoked such consent) to the amendment,
supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which record date shall be the date so fixed by the
Company notwithstanding the provisions of the TIA. If a record date is fixed,
then notwithstanding the last sentence of the immediately preceding paragraph,
those Persons who were Holders at such record date, and only those Persons (or
their duly designated proxies), shall be entitled to revoke any consent
previously given, whether or not such Persons continue to be Holders after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(1) through (4) of Section 9.2, in which case, the amendment, supplement or
waiver shall bind only each Holder of a Security who has
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<PAGE>
consented to it and every subsequent Holder of a Security or portion of a
Security that evidences the same debt as the consenting Holder's Security;
provided, that any such waiver shall not impair or affect the right of any
- --------
Holder to receive payment of principal and premium of and interest on and
Liquidated Damages with respect to a Security, on or after the respective dates
set for such amounts to become due and payable expressed in such Security, or to
bring suit for the enforcement of any such payment on or after such respective
dates.
SECTION 9.5. Notation on or Exchange of Securities.
-------------------------------------
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee
or require the Holder to put an appropriate notation on the Security. The
Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Security shall issue and the
Trustee shall authenticate a new Security that reflects the changed terms. Any
failure to make the appropriate notation or to issue a new Security shall not
affect the validity of such amendment, supplement or waiver.
SECTION 9.6. Trustee to Sign Amendments, Etc.
--------------------------------
The Trustee shall execute any amendment, supplement or waiver authorized
pursuant to this Article IX; provided, that the Trustee may, but shall not be
--------
obligated to, execute any such amendment, supplement or waiver which affects the
Trustee's own rights, duties or immunities under this Indenture. The Trustee
shall be entitled to receive, and shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of any amendment, supplement or
waiver authorized pursuant to this Article IX is authorized or permitted by this
Indenture.
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ARTICLE X
[RESERVED]
ARTICLE XI
RIGHT TO REQUIRE REPURCHASE UPON A CHANGE OF CONTROL
SECTION 1. Repurchase of Securities at Option of the Holder Upon a
-------------------------------------------------------
Change of Control.
- -----------------
(a) In the event that a Change of Control occurs, each Holder
shall have the right, at such Holder's option, subject to the terms and
conditions of this Indenture, to require the Company to repurchase all or any
part of such Holder's Securities (provided, that the principal amount of such
--------
Securities must be $1,000 or an integral multiple thereof) on the date (the
"Repurchase Date") that is no later than 40 Business Days after the occurrence
of such Change of Control, at a cash price (the "Repurchase Price") equal to
101% of the principal amount thereof, together with accrued and unpaid interest
to the Repurchase Date.
(b) In the event that, pursuant to this Section 11.1, the
Company shall be required to commence an offer to purchase Securities (a
"Repurchase Offer"), the Company shall follow the procedures set forth in this
Section 11.1 as follows:
(1) the Repurchase Offer shall commence within 15 Business Days
following a Change of Control;
(2) the Repurchase Offer shall remain open for 20 Business Days
following its commencement, except to the extent that a longer period
is required by applicable law, but in any case not more than 60
Business Days following the Change of Control (the "Repurchase Offer
Period");
(3) upon the expiration of a Repurchase Offer, the Company
shall purchase all Securities tendered in response to the Repurchase
Offer;
(4) if the Repurchase Date is on or after an interest payment
record date and on or before the related Interest Payment Date and
Damage Payment Date,
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any accrued interest and Liquidated Damages will be paid to the Person
in whose name a Security is registered at the close of business on
such record date, and no additional interest or Liquidated Damages
will be payable to Securityholders who tender Securities pursuant to
the Repurchase Offer;
(5) the Company shall provide the Trustee with notice of the
Repurchase Offer at least 5 Business Days before the commencement of
any Repurchase Offer; and
(6) on or before the commencement of any Repurchase Offer, the
Company or the Trustee (upon the request and at the expense of the
Company) shall send, by first-class mail, a notice to each of the
Securityholders, which (to the extent consistent with this Indenture)
shall govern the terms of the Repurchase Offer and shall state:
(i) that the Repurchase Offer is being made pursuant to
such notice and this Section 11.1 and that all Securities, or portions
thereof, tendered will be accepted for payment;
(ii) the Repurchase Price (including the amount of accrued
and unpaid interest and Liquidated Damages, if any), the Repurchase
Date and the Repurchase Put Date;
(iii) that any Security, or portion thereof, not tendered
or accepted for payment will continue to accrue interest and
Liquidated Damages, if any;
(iv) that, unless the Company defaults in depositing Cash
with the Paying Agent in accordance with the last paragraph of this
clause (b) or such payment is prevented pursuant to Article XII, any
Security, or portion thereof, accepted for payment pursuant to the
Repurchase Offer shall cease to accrue interest and Liquidated Damages
after the Repurchase Date;
(v) that Holders electing to have a Security, or portion
thereof, purchased pursuant to a Repurchase Offer will be required to
surrender the Security, with the form entitled "Option of Holder to
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Elect Purchase" on the reverse of the Security completed, to the
Paying Agent (which may not for purposes of this Section 11.1,
notwithstanding anything in this Indenture to the contrary, be the
Company or any Affiliate of the Company) at the address specified in
the notice prior to the close of business on the earlier of (a) the
third Business Day prior to the Repurchase Date and (b) the third
Business Day following the expiration of the Repurchase Offer (such
earlier date being the "Repurchase Put Date");
(vi) that Holders will be entitled to withdraw their
election, in whole or in part, if the Paying Agent (which may not for
purposes of this Section 11.1, notwithstanding anything in this
Indenture to the contrary, be the Company or any Affiliate of the
Company) receives, up to the close of business on the Repurchase Put
Date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Securities
the Holder is withdrawing and a statement that such Holder is
withdrawing his election to have such principal amount of Securities
purchased; and
(vii) a brief description of the events resulting in such
Change of Control.
Any such Repurchase Offer shall comply with all applicable
provisions of Federal and state laws, including those regulating tender offers,
if applicable, and any provisions of this Indenture which conflict with such
laws shall be deemed to be superseded by the provisions of such laws.
On or before the Repurchase Date, the Company shall (i) accept
for payment Securities or portions thereof properly tendered pursuant to the
Repurchase Offer on or before the Repurchase Put Date, (ii) deposit with the
Paying Agent Cash sufficient to pay the Repurchase Price (together with accrued
and unpaid interest and Liquidated Damages, if any) of all Securities or
portions thereof so tendered and (iii) deliver to the Trustee Securities so
accepted together with an Officers' Certificate listing the Securities or
portions thereof being purchased by the Company. The Paying Agent shall promptly
mail to Holders of Securities so accepted payment in an amount equal to the
Repurchase Price (together with accrued and unpaid interest and Liquidated
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Damages, if any), and the Trustee shall promptly authenticate and mail or
deliver to such Holders a new Security or Securities equal in principal amount
to any unpurchased portion of the Securities surrendered. Any Securities not so
accepted shall be promptly mailed or delivered by the Company to the Holder
thereof.
ARTICLE XII
SUBORDINATION
SECTION 12.1. Securities Subordinated to Senior Indebtedness.
----------------------------------------------
The Company and each Holder, by its acceptance of Securities, agree
that (a) the payment of the principal of and interest on the Securities and (b)
any other payment in respect of the Securities, including on account of the
acquisition or redemption of the Securities by the Company (including, without
limitation, pursuant to Article XI) is subordinated, to the extent and in the
manner provided in this Article XII, to the prior payment in full of all Senior
Indebtedness of the Company, whether outstanding at the date of this Indenture
or thereafter created, incurred, assumed or guaranteed, and that these
subordination provisions are for the benefit of the holders of Senior
Indebtedness.
This Article XII shall constitute a continuing offer to all Persons
who, in reliance upon such provisions, become holders of, or continue to hold,
Senior Indebtedness, and such provisions are made for the benefit of the holders
of Senior Indebtedness, and such holders are made obligees hereunder and any one
or more of them may enforce such provisions.
SECTION 12.2. No Payment on Securities in Certain Circumstances.
-------------------------------------------------
(a) No payment may be made by the Company on account of the
principal of, premium, if any, interest on, or Liquidated Damages with respect
to, the Securities, or to acquire any of the Securities (including repurchases
of Securities at the option of the Holder) for cash or property (other than
Junior Securities), or on account of the redemption provisions of the
Securities, (i) upon the maturity of any Senior Indebtedness of the Company by
lapse of time, acceleration (unless waived) or otherwise, unless and until
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all principal of, premium, if any, and interest on such Senior Indebtedness are
first paid in full (or such payment is duly provided for), or (ii) in the event
of default in the payment of any principal of, premium, if any, or interest on
any Senior Indebtedness of the Company when it becomes due and payable, whether
at maturity or at a date fixed for prepayment or by declaration or otherwise (a
"Payment Default"), unless and until such Payment Default has been cured or
waived or otherwise has ceased to exist.
(b) Upon (i) the happening of an event of default (other than a
Payment Default) that permits the holders of Senior Indebtedness or their
representative immediately to accelerate its maturity and (ii) written notice of
such event of default given to the Company and the Trustee by the holders of an
aggregate of at least $20,000,000 principal amount outstanding of such Senior
Indebtedness or their representative (a "Payment Notice"), then, unless and
until such event of default has been cured or waived or otherwise has ceased to
exist, no payment (by set-off or otherwise) may be made by or on behalf of the
Company on account of the principal of, premium, if any, interest on, or
Liquidated Damages with respect to, the Securities, or to acquire or repurchase
any of the Securities for cash or property, or on account of the redemption
provisions of the Securities, in any such case other than payments made with
Junior Securities of the Company. Notwithstanding the foregoing, unless (i) the
Senior Indebtedness in respect of which such event of default exists has been
declared due and payable in its entirety within 179 days after the Payment
Notice is delivered as set forth above (the "Payment Blockage Period"), and (ii)
such declaration has not been rescinded or waived, at the end of the Payment
Blockage Period, the Company shall be required to pay all sums not paid to the
Holders of the Securities during the Payment Blockage Period due to the
foregoing prohibitions and to resume all other payments as and when due on the
Securities. Any number of Payment Notices may be given; provided, however, that
-----------------
(i) not more than one Payment Notice shall be given within a period of any 360
consecutive days, and (ii) no default that existed upon the date of such Payment
Notice or the commencement of such Payment Blockage Period (whether or not such
event of default is on the same issue of Senior Indebtedness) shall be made the
basis for the commencement of any other Payment Blockage Period.
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(c) In furtherance of the provisions of Section 12.1, in the
event that, notwithstanding the foregoing provisions of this Section 12.2, any
payment or distribution of assets of the Company (other than Junior Securities)
shall be received by the Trustee or the Holders at a time when such payment or
distribution is prohibited by the provisions of this Section 12.2, then such
payment or distribution (subject to the provisions of Section 12.7) shall be
received and held in trust by the Trustee or such Holder or Paying Agent for the
benefit of the holders of Senior Indebtedness of the Company, and shall be paid
or delivered by the Trustee or such Holders or such Paying Agent, as the case
may be, to the holders of Senior Indebtedness of the Company remaining unpaid or
unprovided for or their representative or representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing any of
such Senior Indebtedness of the Company may have been issued, ratably according
to the aggregate amounts remaining unpaid on account of the Senior Indebtedness
of the Company held or represented by each, for application to the payment of
all Senior Indebtedness of the Company in full after giving effect to any
concurrent payment and distribution to the holders of such Senior Indebtedness.
SECTION 12.3. Securities Subordinated to Prior Payment of All Senior
------------------------------------------------------
Indebtedness on Dissolution, Liquidation or Reorganization.
- ----------------------------------------------------------
Upon any distribution of assets of the Company upon any dissolution,
winding up, total or partial liquidation or reorganization of the Company,
whether voluntary or involuntary, in bankruptcy, insolvency, receivership or a
similar proceeding or upon assignment for the benefit of creditors or any
marshalling of assets or liabilities:
(a) the holders of all Senior Indebtedness of the Company shall
first be entitled to receive payments in full (or have such payment duly
provided for) before the Holders are entitled to receive any payment on account
of the principal of, premium, if any, interest on, and Liquidated Damages with
respect to, the Securities (other than Junior Securities);
(b) any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities (other than Junior
Securities) to which the Holders or the Trustee on behalf of the Holders
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would be entitled (by setoff or otherwise), except for the provisions of this
Article XII, shall be paid by the liquidating trustee or agent or other Person
making such a payment or distribution directly to the holders of Senior
Indebtedness of the Company or their representative to the extent necessary to
make payment in full of all such Senior Indebtedness remaining unpaid, after
giving effect to any concurrent payment or distribution to the holders of such
Senior Indebtedness; and
(c) in the event that, notwithstanding the foregoing, any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities (other than Junior Securities), shall be
received by the Trustee or the Holders or any Paying Agent (or, if the Company
or any Affiliate of the Company is acting as its own Paying Agent, money for any
such payment or distribution shall be segregated or held in trust) on account of
the principal of or interest on the Securities before all Senior Indebtedness of
the Company is paid in full, such payment or distribution (subject to the
provisions of Section 12.7) shall be received and held in trust by the Trustee
or such Holder or Paying Agent for the benefit of the holders of such Senior
Indebtedness, or their respective representative, ratably according to the
respective amounts of such Senior Indebtedness held or represented by each, to
the extent necessary to make payment as provided herein of all such Senior
Indebtedness remaining unpaid after giving effect to all concurrent payments and
distributions and all provisions therefor to or for the holders of such Senior
Indebtedness, but only to the extent that as to any holder of such Senior
Indebtedness, as promptly as practical following notice from the Trustee to the
holders of such Senior Indebtedness that such prohibited payment has been
received by the Trustee, Holder(s) or Paying Agent (or has been segregated as
provided above), such holder (or a representative therefor) notifies the Trustee
of the amounts then due and owing on such Senior Indebtedness, if any, held by
such holder and only the amounts specified in such notices to the Trustee shall
be paid to the holders of such Senior Indebtedness.
SECTION 12.4. Securityholders to Be Subrogated to Rights of Holders
-----------------------------------------------------
of Senior Indebtedness.
- ----------------------
Subject to the payment in full of all Senior Indebtedness of the
Company as provided herein, the Holders
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of Securities shall be subrogated to the rights of the holders of such Senior
Indebtedness to receive payments or distributions of assets of the Company
applicable to the Senior Indebtedness until all amounts owing on the Securities
shall be paid in full, and for the purpose of such subrogation no such payments
or distributions to the holders of such Senior Indebtedness by the Company, or
by or on behalf of the Holders by virtue of this Article XII, which otherwise
would have been made to the Holders shall, as between the Company and the
Holders, be deemed to be payment by the Company or on account of such Senior
Indebtedness, it being understood that the provisions of this Article XII are
and are intended solely for the purpose of defining the relative rights of the
Holders, on the one hand, and the holders of such Senior Indebtedness, on the
other hand.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article XII shall have been
applied, pursuant to the provisions of this Article XII, to the payment of
amounts payable under Senior Indebtedness of the Company, then the Holders shall
be entitled to receive from the holders of such Senior Indebtedness any payments
or distributions received by such holders of Senior Indebtedness in excess of
the amount sufficient to pay all amounts payable under or in respect of such
Senior Indebtedness in full.
SECTION 12.5. Obligations of the Company Unconditional.
----------------------------------------
Nothing contained in this Article XII or elsewhere in this Indenture
or in the Securities is intended to or shall impair as between the Company and
the Holders, the obligation of each such Person, which is absolute and
unconditional, to pay to the Holders the principal of, premium, if any, interest
on, and Liquidated Damages with respect to, the Securities as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the Holders and creditors of the Company
other than the holders of the Senior Indebtedness, nor shall anything herein or
therein prevent the Trustee or any Holder from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article XII, of the holders of Senior Indebtedness in
respect of cash, property or securities of the Company received upon the
exercise of any such remedy. Notwithstand-
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ing anything to the contrary in this Article XII or elsewhere in this Indenture
or in the Securities, upon any distribution of assets of the Company referred to
in this Article XII, the Trustee, subject to the provisions of Sections 7.1 and
7.2, and the Holders shall be entitled to rely upon any order or decree made by
any court of competent jurisdiction in which such dissolution, winding up,
liquidation or reorganization proceedings are pending, or a certificate of the
liquidating trustee or agent or other Person making any distribution to the
Trustee or to the Holders for the purpose of ascertaining the Persons entitled
to participate in such distribution, the holders of the Senior Indebtedness and
other Indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article XII so long as such court has been apprised of the
provisions of, or the order, decree or certificate makes reference to, the
provisions of this Article XII. Nothing in this Section 12.5 shall apply to the
claims of, or payments to, the Trustee under or pursuant to Section 7.7.
SECTION 12.6. Trustee Entitled to Assume Payments Not Prohibited in
-----------------------------------------------------
Absence of Notice.
- -----------------
The Trustee shall not at any time be charged with knowledge of the
existence of any facts which would prohibit the making of any payment to or by
the Trustee unless and until a Trust Officer of the Trustee or any Paying Agent
shall have received, no later than one Business Day prior to such payment,
written notice thereof from the Company or from one or more holders of Senior
Indebtedness or from any representative therefor and, prior to the receipt of
any such written notice, the Trustee, subject to the provisions of Sections 7.1
and 7.2, shall be entitled in all respects conclusively to assume that no such
fact exists.
SECTION 12.7. Application by Trustee of Assets Deposited with It.
--------------------------------------------------
Amounts deposited in trust with the Trustee pursuant to and in
accordance with Article VIII shall be for the sole benefit of Securityholders
and, to the extent allocated for the payment of Securities, shall not be subject
to the subordination provisions of this Article XII. Otherwise, any deposit of
assets with the Trustee or the Agent (whether or not in trust) for the payment
of principal of or interest
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on any Securities shall be subject to the provisions of Sections 12.1, 12.2,
12.3 and 12.4; provided that, if prior to one Business Day preceding the date on
-------- ----
which by the terms of this Indenture any such assets may become distributable
for any purpose (including, without limitation, the payment of either principal
of or interest on any Security) the Trustee or such Paying Agent shall not have
received with respect to such assets the written notice provided for in Section
12.6, then the Trustee or such Paying Agent shall have full power and authority
to receive such assets and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary which may be
received by it on or after such date.
SECTION 12.8. Subordination Rights Not Impaired by Acts or Omissions
------------------------------------------------------
of the Company or Holders of Senior Indebtedness.
- ------------------------------------------------
No right of any present or future holders of any Senior Indebtedness
to enforce subordination provisions contained in this Article XII shall at any
time in any way be prejudiced or impaired by any act or failure to act on the
part of the Company or by any act or failure to act, in good faith, by any such
holder, or by any noncompliance by the Company with the terms of this Indenture,
regardless of any knowledge thereof which any such holder may have or be
otherwise charged with. The holders of Senior Indebtedness may extend, renew,
modify or amend the terms of the Senior Indebtedness or any security therefor
and release, sell or exchange such security and otherwise deal freely with the
Company, all without affecting the liabilities and obligations of the parties to
this Indenture or the Holders.
SECTION 12.9. Securityholders Authorize Trustee to Effectuate
-----------------------------------------------
Subordination of Securities.
- ---------------------------
Each Holder of the Securities by his acceptance thereof authorizes and
expressly directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provisions contained in
this Article XII and to protect the rights of the Holders pursuant to this
Indenture, and appoints the Trustee his attorney-in-fact for such purpose,
including, in the event of any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors of the Company),
the immediate filing
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of a claim for the unpaid balance of his Securities in the form required in said
proceedings and cause said claim to be approved. If the Trustee does not file a
proper claim or proof of debt in the form required in such proceeding prior to
30 days before the expiration of the time to file such claim or claims, then the
holders of the Senior Indebtedness or their representative are or is hereby
authorized to have the right to file and are or is hereby authorized to file an
appropriate claim for and on behalf of the Holders of said Securities. Nothing
herein contained shall be deemed to authorize the Trustee or the holders of
Senior Indebtedness or their representative to authorize or consent to or accept
or adopt on behalf of any Securityholder any plan of reorganization,
arrangement, adjustment or composition affecting the Securities or the rights of
any Holder thereof, or to authorize the Trustee or the holders of Senior
Indebtedness or their representative to vote in respect of the claim of any
Securityholder in any such proceeding.
SECTION 12.10. Right of Trustee to Hold Senior Indebtedness.
--------------------------------------------
The Trustee shall be entitled to all of the rights set forth in this
Article XII in respect of any Senior Indebtedness at any time held by it to the
same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall be construed to deprive the Trustee of any of its rights as such
holder.
SECTION 12.11. Article XII Not to Prevent Events of Default.
--------------------------------------------
The failure to make a payment on account of principal of, premium, if
any, interest on, or Liquidated Damages with respect to, the Securities by
reason of any provision of this Article XII shall not be construed as preventing
the occurrence of a Default or an Event of Default under Section 6.1 or in any
way prevent the Holders from exercising any right hereunder other than the right
to receive payment on the Securities.
SECTION 12.12. No Fiduciary Duty of Trustee to Holders of Senior
-------------------------------------------------
Indebtedness.
- ------------
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness, and shall not be liable to any such holders
(other than for its will-
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ful misconduct or negligence) if it shall in good faith mistakenly pay over or
distribute to the Holders of Securities or the Company or any other Person,
cash, property or securities to which any holders of Senior Indebtedness shall
be entitled by virtue of this Article XII or otherwise. Nothing in this Section
12.12 shall affect the obligation of any other such Person to hold such payment
for the benefit of, and to pay such payment over to, the holders of Senior
Indebtedness or their representative.
ARTICLE XIII
CONVERSION OF SECURITIES
SECTION 13.1. Conversion Privilege.
--------------------
Subject to and upon compliance with the provisions of this Article
XIII, at the option of the Holder thereof, any Security may at any time be
converted, in whole, or in part in multiples of $1,000 principal amount, into
fully paid and non-assessable shares of Common Stock issuable upon conversion of
the Securities, at the conversion price in effect at the Date of Conversion,
until and including, but not after the close of business on the second Business
Day prior to Stated Maturity, or unless such Security or some portion thereof
shall have been called for redemption or delivered for repurchase prior to such
date and no default is made in making due provision for the payment of the
redemption price in accordance with the terms of this Indenture, in which case,
with respect to such Security or portion thereof as has been so called for
redemption or delivered for repurchase, such Security or portion thereof may be
so converted until and including, but not after, the close of business on the
fifth or second Business Day, respectively, prior to the Redemption Date or
Repurchase Date, as applicable, for such Security, unless the Company
subsequently fails to pay the applicable Redemption Price or Repurchase Price,
as the case may be.
SECTION 13.2. Exercise of Conversion Privilege.
--------------------------------
In order to exercise the conversion privilege, the Holder of any
Security to be converted shall surrender such Security to the Company at any
time during usual business hours at its office or agency maintained for the
purpose as provided in this Indenture, accompanied by a fully executed written
notice, in substantially the form set forth on the
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reverse of the Security, that the Holder elects to convert such Security or a
stated portion thereof constituting a multiple of $1,000 principal amount, and,
if such Security is surrendered for conversion during the period between the
close of business on any Record Date and the opening of business on the next
following Interest Payment Date and has not been called for redemption on a
Redemption Date which occurs within such period, accompanied also by payment of
an amount equal to the interest payable on such Interest Payment Date on the
principal amount of the Security being surrendered for conversion,
notwithstanding such conversion. The Holder of any Security at the close of
business on a Record Date will be entitled to receive the interest payable on
such Security on the corresponding Interest Payment Date notwithstanding the
conversion thereof after such Record Date. Such notice of conversion shall also
state the name or names (with address) in which the certificate or certificates
for shares of Common Stock shall be issued. Securities surrendered for
conversion shall (if reasonably required by the Company or the Trustee) be duly
endorsed by, or be accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company duly executed by, the Holder or his
attorney duly authorized in writing. As promptly as practicable after the
receipt of such notice and the surrender of such Security as aforesaid, the
Company shall, subject to the provisions of Section 13.8 hereof, issue and
deliver at such office or agency to such Holder, or on his written order, a
certificate or certificates for the number of full shares of Common Stock
issuable on such conversion of Securities in accordance with the provisions of
this Article XIII and Cash, as provided in Section 13.3 hereof, in respect of
any fraction of a share of Common Stock otherwise issuable upon such conversion.
Such conversion shall be deemed to have been effected immediately prior to the
close of business on the date (herein called the "Date of Conversion") on which
such Security shall have been surrendered as aforesaid, and the person or
persons in whose name or names any certificate or certificates for shares of
Common Stock shall be issuable upon such conversion shall be deemed to have
become on the Date of Conversion the holder or holders of record of the shares
represented thereby; provided, however, that any such surrender on any date when
-------- -------
the stock transfer books of the Company shall be closed shall cause the person
or persons in whose name or names the certificate or certificates for such
shares are to be issued to be deemed to have become the recordholder or holders
thereof for all purposes at the opening of business on the
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<PAGE>
next succeeding day on which such stock transfer books are open but such
conversion shall nevertheless be at the conversion price in effect at the close
of business on the date when such Security shall have been so surrendered with
the conversion notice. In the case of conversion of a portion, but less than
all, of a Security, the Company shall as promptly as practicable execute, and
the Trustee shall authenticate and deliver to the Holder thereof, at the expense
of the Company, a Security or Securities in the aggregate principal amount of
the unconverted portion of the Security surrendered. Except as otherwise
expressly provided in this Indenture, no payment or adjustment shall be made for
interest accrued on any Security (or portion thereof) converted or for dividends
or distributions on any Common Stock issued upon conversion of any Security.
SECTION 13.3. Fractional Interests.
--------------------
No fractions of shares or scrip representing fractions of shares shall
be issued upon conversion of Securities. If more than one Security shall be
surrendered for conversion at one time by the same holder, the number of full
shares which shall be issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Securities so surrendered. If any
fraction of a share of Common Stock would, except for the foregoing provisions
of this Section 13.3, be issuable on the conversion of any Security or
Securities, the Company shall make payment in lieu thereof in an amount of Cash
equal to the value of such fraction computed on the basis of the last sale price
of the Common Stock as reported on the New York Stock Exchange (or if not listed
for trading thereon, then on the principal national securities exchange on which
the Common Stock is listed or admitted to trading) at the close of business on
the Date of Conversion or if no such sale takes place on such day, the last sale
price for such day shall be the average of the closing bid and asked prices
regular way on the New York Stock Exchange (or if not listed for trading
thereon, on the principal national securities exchange on which the Common Stock
is listed or admitted to trading) for such day (any such last sale price being
hereinafter referred to as the "Last Sale Price"). If on such Trading Day the
Common Stock is not quoted by any such organization, the fair value of such
Common Stock on such day, as reasonably determined in good faith by the Board of
Directors of the Company, shall be used.
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SECTION 13.4. Conversion Price.
----------------
The conversion price per share of Common Stock issuable upon
conversion of the Securities shall initially be $27.50 (or $27.50 in principal
amount of Securities for each such share of Common Stock).
SECTION 13.5. Adjustment of Conversion Price.
------------------------------
The conversion price (herein called the "Conversion Price") shall be
subject to adjustment from time to time as follows:
(a) In case the Company shall (1) make or pay a dividend (or
other distribution) in shares of Common Stock on any class of Capital Stock of
the Company, (2) subdivide its outstanding shares of Common Stock into a greater
number of shares or (3) combine or reclassify its outstanding shares of Common
Stock into a smaller number of shares, the Conversion Price in effect
immediately prior to such action shall be adjusted so that the Holder of any
Security thereafter surrendered for conversion shall be entitled to receive the
number of shares of Common Stock that he would have owned immediately following
such action had such Security been converted immediately prior thereto. An
adjustment made pursuant to this subsection (a) shall become effective
immediately, except as provided in subsection (h) below, after the record date
in the case of a dividend or distribution and shall become effective immediately
after the effective date in the case of a subdivision or combination.
(b) In case the Company shall issue rights, options or warrants
to all holders of Common Stock entitling them to subscribe for or purchase
shares of Common Stock at a price per share less than the then current market
price per share of the Common Stock (as determined pursuant to subsection (f)
below) on the record date mentioned below, the Conversion Price shall be
adjusted to a price, computed to the nearest cent, so that the same shall equal
the price determined by multiplying:
(i) the Conversion Price in effect immediately prior to the
date of issuance of such rights or warrants by a fraction, of which
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(ii) the numerator shall be (A) the number of shares of
Common Stock outstanding on the date of issuance of such rights, options or
warrants, immediately prior to such issuance, plus (B) the number of shares
which the aggregate offering price of the total number of shares so offered
for subscription or purchase would purchase at such current market price
(determined by multiplying such total number of shares by the exercise
price of such rights, options or warrants and dividing the product so
obtained by such current market price), and of which
(iii) the denominator shall be (A) the number of shares of
Common Stock outstanding on the date of issuance of such rights, options or
warrants, immediately prior to such issuance, plus (B) the number of
additional shares of Common Stock which are so offered for subscription or
purchase.
Such adjustment shall become effective immediately, except as provided
in subsection (h) below, after the record date for the determination of holders
entitled to receive such rights, options or warrants; provided, however, that if
-------- -------
any such rights, options or warrants issued by the Company as described in this
subsection (b) are only exercisable upon the occurrence of certain triggering
events relating to control and provided for in shareholder rights plans, then
the Conversion Price will not be adjusted as provided in this subsection (b)
until such triggering events occur.
(c) In case the Company or any subsidiary of the Company shall
distribute to all holders of Common Stock, any of its assets, evidences of
indebtedness, cash or other assets or shares of Capital Stock other than Common
Stock (including securities, but other than (x) dividends or distributions
exclusively in cash or (y) any dividend or distribution for which an adjustment
is required to be made in accordance with subsection (a) or (b) above) then in
each such case the Conversion Price shall be adjusted so that the same shall
equal the price determined by multiplying the Conversion Price in effect
immediately prior to the date of such distribution by a fraction of which the
numerator shall be the then current market price per share of the Common Stock
(determined as provided in subsection (f) below) on the record date mentioned
below less the then fair market value (as reasonably determined in good faith by
the Board
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<PAGE>
of Directors of the Company) of the portion of the assets so distributed
applicable to one share of Common Stock, and of which the denominator shall be
such current market price per share of the Common Stock. Such adjustment shall
become effective immediately, except as provided in subsection (h) below, after
the record date for the determination of stockholders entitled to receive such
distribution. Notwithstanding the foregoing, in the event that the fair market
value of the assets, evidences of indebtedness or other securities so
distributed applicable to one share of Common Stock equals or exceeds such
current market price per share of Common Stock, or such current market price
exceeds such fair market value by less than $0.10 per share, the Conversion
Price shall not be adjusted pursuant to this subsection (c) and, to the extent
applicable, the provisions of subsection (k) shall apply to such distribution.
(d) In case the Company or any subsidiary of the Company shall
make any distribution consisting exclusively of cash (excluding any cash portion
of distributions for which an adjustment is required to be made in accordance
with (c) above, or cash distributed upon a merger or consolidation to which
Section 13.6 applies) to all holders of Common Stock in an aggregate amount
that, combined together with (i) all other such all-cash distributions made
within the then preceding 12 months in respect of which no adjustment has been
made and (ii) any cash and the fair market value of other consideration paid or
payable in respect of any tender offer by the Company or any of its subsidiaries
for Common Stock concluded within the preceding 12 months in respect of which no
adjustment has been made, exceeds 15% of the Company's market capitalization
(defined as being the product of the then current market price of the Common
Stock (determined as provided in subsection (f) below) times the number of
shares of Common Stock then outstanding) on the record date of such
distribution, in each such case the Conversion Price shall be adjusted so that
the same shall equal the price determined by multiplying the Conversion Price in
effect immediately prior to the date of such distribution by a fraction of which
the numerator shall be the then current market price per share of the Common
Stock on such record date less the amount of the cash so distributed applicable
to one share of Common Stock, and of which the denominator shall be such current
market price per share of the Common Stock. Such adjustment shall become
effective immediately, except as provided in subsection (h) below, after the
record date for the determination of stockholders entitled to
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receive such distribution. Notwithstanding the foregoing, in the event that the
cash so distributed applicable to one share of Common Stock equals or exceeds
such current market price per share of Common Stock, or such current market
price exceeds such amount of cash by less than $0.10 per share, the Conversion
Price shall not be adjusted pursuant to this subsection (d).
(e) In case there shall be completed a tender or exchange offer
made by the Company or any subsidiary of the Company for all or any portion of
the Common Stock (any such tender or exchange offer being referred to as an
"Offer") that involves an aggregate consideration having a fair market value as
of the expiration of such Offer (the "Expiration Time") that, together with (i)
any cash and the fair market value of any other consideration payable in respect
of any other Offer, as of the expiration of such other Offer, expiring within
the 12 months preceding the expiration of such Offer and in respect for which no
Conversion Price adjustment pursuant to this subsection (e) has been made and
(ii) the aggregate amount of any all-cash distributions referred to in
subsection (d) of this Section 13.5 to all holders of Common Stock within the 12
months preceding the expiration of such Offer for which no conversion price
adjustment pursuant to such subsection (d) has been made, exceeds 15% of the
product of the then current market price per share (determined as provided in
subsection (f) below) of the Common Stock on the Expiration Time times the
number of shares of Common Stock outstanding (including any tendered shares) on
the Expiration Time, the Conversion Price shall be reduced by multiplying such
Conversion Price in effect immediately prior to the Expiration Time by a
fraction of which the numerator shall be (i) the product of the then current
market price per share (determined as provided in subsection (f) below) of the
Common Stock on the Expiration Time times the number of shares of Common Stock
outstanding (including any tendered shares) on the Expiration Time minus (ii)
the fair market value of the aggregate consideration payable to stockholders
based on the acceptance (up to any maximum specified in the terms of the Offer)
of all shares validly tendered and not withdrawn as of the Expiration Time (the
shares deemed so accepted being referred to as the "Purchased Shares") and the
denominator shall be the product of (i) such current market price per share on
the Expiration Time times (ii) such number of outstanding shares on the
Expiration Time less the number of Purchased Shares, such reduction to become
effective immedi-
78
<PAGE>
ately prior to the opening of business on the day following the Expiration Time.
For purposes of this subsection (e), the fair market value of any
consideration with respect to an Offer shall be reasonably determined in good
faith by the Board of Directors of the Company and described in a Board
Resolution.
(f) For the purpose of any computation under subsections (b),
(c), (d) and (e) above, the current market price per share of Common Stock on
any date shall be deemed to be the average of the Last Sale Prices of a share of
Common Stock for the five consecutive Trading Days selected by the Company
commencing not more than 20 Trading Days before, and ending not later than, the
earlier of the date in question and the date before the "`ex' date," with
respect to the issuance, distribution or Offer requiring such computation. If on
any such Trading Day the Common Stock is not quoted by any organization referred
to in the definition of Last Sale Price in Section 13.3 hereof, the fair value
of the Common Stock on such day, as reasonably determined in good faith by the
Board of Directors of the Company, shall be used. For purposes of this
paragraph, the term "`ex' date," when used with respect to any issuance,
distribution or payments with respect to an Offer, means the first date on which
the Common Stock trades regular way on the New York Stock Exchange (or if not
listed or admitted to trading thereon, then on the principal national securities
exchange on which the Common Stock is listed or admitted to trading) without the
right to receive such issuance, distribution or Offer.
(g) In addition the foregoing adjustments in subsections (a),
(b), (c), (d) and (e) above, the Company will be permitted to make such
reductions in the Conversion Price as it considers to be advisable in order that
any event treated for Federal income tax purposes as a dividend of stock or
stock rights will not be taxable to the holders of the shares of Common Stock.
(h) In any case in which this Section 13.5 shall require that
an adjustment (including by reason of the last sentence of subsection (a) or (c)
above) be made immediately following a record date, the Company may elect to
defer the effectiveness of such adjustment (but in no event until a date later
than the effective time of the event
79
<PAGE>
giving rise to such adjustment), in which case the Company shall, with respect
to any Security converted after such record date and on and before such
adjustment shall have become effective (i) defer paying any Cash payment
pursuant to Section 13.3 hereof or issuing to the Holder of such Security the
number of shares of Common Stock and other capital stock of the Company (or
other assets or securities) issuable upon such conversion in excess of the
number of shares of Common Stock and other Capital Stock of the Company issuable
thereupon only on the basis of the Conversion Price prior to adjustment, and
(ii) not later than five Business Days after such adjustment shall have become
effective, pay to such Holder the appropriate Cash payment pursuant to Section
13.3 hereof and issue to such Holder the additional shares of Common Stock and
other Capital Stock of the Company issuable on such conversion.
(i) No adjustment in the Conversion Price shall be required
unless such adjustment would require an increase or decrease of at least 1.0% of
the Conversion Price; provided, that any adjustments which by reason of this
--------
subsection (i) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Article
XIII shall be made to the nearest cent or to the nearest one-hundredth of a
share, as the case may be.
(j) Whenever the Conversion Price is adjusted as herein
provided, the Company shall promptly (i) file with the Trustee and each
conversion agent an Officers' Certificate setting forth the Conversion Price
after such adjustment and setting forth a brief statement of the facts requiring
such adjustment, which certificate shall be conclusive evidence of the
correctness of such adjustment, and (ii) mail or cause to be mailed a notice of
such adjustment to each holder of Securities at his address as the same appears
on the registry books of the Company.
(k) In the event that the Company distributes rights or
warrants (other than those referred to in subsection (b) above) pro rata to
holders of Common Stock, so long as any such rights or warrants have not expired
or been redeemed by the Company, the Company shall make proper provision so that
the Holder of any Note surrendered for conversion will be entitled to receive
upon such conversion, in addition to the shares of Common Stock issuable upon
such conversion (the "Conversion Shares"), a number of rights or
80
<PAGE>
warrants to be determined as follows: (i) if such conversion occurs on or prior
to the date for the distribution to the holders of rights or warrants of
separate certificates evidencing such rights or warrants (the "Distribution
Date"), the same number of rights or warrants to which a holder of a number of
shares of Common Stock equal to the number of Conversion Shares is entitled at
the time of such conversion in accordance with the terms and provisions of and
applicable to the rights or warrants, and (ii) if such conversion occurs after
such Distribution Date, the same number of rights or warrants to which a holder
of the number of shares of Common Stock into which the principal amount of such
Note so converted was convertible immediately prior to such Distribution Date
would have been entitled on such Distribution Date in accordance with the terms
and provisions of and applicable to the rights or warrants.
SECTION 13.6. Continuation of Conversion Privilege in Case of
-----------------------------------------------
Reclassification, Change, Merger, Consolidation or Sale of Assets.
- -----------------------------------------------------------------
If any of the following shall occur, namely: (a) any reclassification
or change of outstanding shares of Common Stock issuable upon conversion of the
Securities (other than a change in par value, or from par value to no par value,
or from no par value, to par value, or as a result of a subdivision or
combination), (b) any consolidation or merger of the Company with or into any
other Person, or the merger of any other Person with or into the Company (other
than a merger which does not result in any reclassification, change, conversion,
exchange or cancellation of outstanding shares of Common Stock) or (c) any sale,
transfer or conveyance of all or substantially all of the assets of the Company
(computed on a consolidated basis), then the Company, or such successor or
purchasing entity, as the case may be, shall, as a condition precedent to such
reclassification, change, consolidation, merger, sale or conveyance, execute and
deliver to the Trustee a supplemental indenture providing that the Holder of
each Security then outstanding shall have the right to convert such Security
only into the kind and amount of shares of stock and other securities and
property (including cash) receivable upon such reclassification, change,
consolidation, merger, sale, transfer or conveyance by a holder of the number of
shares of Common Stock issuable upon conversion of such Security immediately
prior to such reclassification, change, consolidation, merger, sale, transfer or
conveyance assuming such holder of Common
81
<PAGE>
Stock of the Company failed to exercise his rights of an election, if any, as to
the kind or amount of securities, cash and other property receivable upon such
reclassification, change, consolidation, merger, sale, transfer or conveyance
(provided that if the kind or amount of securities, cash, and other property
--------
receivable upon such reclassification, change, consolidation, merger, sale,
transfer or conveyance is not the same for each share of Common Stock of the
Company held immediately prior to such reclassification, change, consolidation,
merger, sale, transfer or conveyance in respect of which such rights of election
shall not have been exercised ("non-electing share"), then for the purpose of
this Section 13.6 the kind and amount of securities, cash and other property
receivable upon such reclassification, change, consolidation, merger, sale,
transfer or conveyance by each non-electing share shall be deemed to be the kind
and amount so receivable per share by a plurality of the non-electing shares).
Such supplemental indenture shall provide for adjustments which shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Article XIII. If, in the case of any such consolidation, merger, sale or
conveyance, the stock or other securities and property (including cash)
receivable thereupon by a holder of shares of Common Stock includes shares of
stock or other securities and property (including cash) of a corporation other
than the successor or purchasing corporation, as the case may be, in such
consolidation, merger, sale or conveyance, then such supplemental indenture
shall also be executed by such other corporation and shall contain such
additional provisions to protect the interests of the Holders of the Securities
as the Board of Directors of the Company shall reasonably consider necessary by
reason of the foregoing. The provisions of this Section 13.6 shall similarly
apply to successive consolidations, mergers, sales or conveyances.
Notice of the execution of each such supplemental indenture shall be
mailed to each Holder of Securities at his address as the same appears on the
registry books of the Company.
Neither the Trustee nor any conversion agent shall be under any
responsibility to determine the correctness of any provisions contained in any
such supplemental indenture relating either to the kind or amount of shares of
stock or securities or property (including cash) receivable by Holders of
Securities upon the conversion of their Securities
82
<PAGE>
after any such reclassification, change, consolidation, merger, sale or
conveyance or to any adjustment to be made with respect thereto, but, subject to
the provisions of Article VIII hereof, may accept as conclusive evidence of the
correctness of any such provisions, and shall be protected in relying upon, the
Officers' Certificate (which the Company shall be obligated to file with the
Trustee prior to the execution of any such supplemental indenture) with respect
thereto.
SECTION 13.7. Notice of Certain Events.
------------------------
In case:
(a) the Company shall declare a dividend (or any other
distribution) payable to the holders of Common Stock (other than cash
dividends);
(b) the Company shall authorize the granting to the holders of
Common Stock of rights, warrants or options to subscribe for or purchase any
shares of stock of any class or of any other rights;
(c) the Company shall authorize any reclassification or change
of the Common Stock (including a subdivision or combination of its outstanding
shares of Common Stock), or any consolidation or merger to which the Company is
a party and for which approval of any stockholders of the Company is required,
or the sale or conveyance of all or substantially all the property or business
of the Company;
(d) there shall be proposed any voluntary or involuntary
dissolution, liquidation or winding-up of the Company; or
(e) the Company or any of its Subsidiaries shall complete an
Offer;
then, the Company shall cause to be filed at the office or agency maintained for
the purpose of conversion of the Securities as provided in Section 3.2 hereof,
and shall cause to be mailed to each Holder of Securities, at his address as it
shall appear on the registry books of the Company, at least 20 days before the
date hereinafter specified (or the earlier of the dates hereinafter specified,
in the event that more than one date is specified), a notice stating the date on
which (1) a record is expected to be
83
<PAGE>
taken for the purpose of such dividend, distribution, rights, warrants or
options or Offer, or if a record is not to be taken, the date as of which the
holders of Common Stock of record to be entitled to such dividend, distribution,
rights, warrants or options or to participate in such Offer are to be
determined, or (2) such reclassification, change, consolidation, merger, sale,
conveyance, dissolution, liquidation or winding-up is expected to become
effective and the date, if any is to be fixed, as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities or other property deliverable upon such
reclassification, change, consolidation, merger, sale, conveyance, dissolution,
liquidation or winding-up.
SECTION 13.8. Taxes on Conversion.
-------------------
The Company will pay any and all documentary, stamp or similar taxes
payable to the United States of America or any political subdivision or taxing
authority thereof or therein in respect of the issue or delivery of shares of
Common Stock on conversion of Securities pursuant thereto; provided, however,
-------- -------
that the Company shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issue or delivery of shares of Common
Stock in a name other than that of the Holder of the Securities to be converted
and no such issue or delivery shall be made unless and until the person
requesting such issue or delivery has paid to the Company the amount of any such
tax or has established, to the satisfaction of the Company, that such tax has
been paid. The Company extends no protection with respect to any other taxes
imposed in connection with conversion of Securities.
SECTION 13.9. Company to Provide Stock.
------------------------
The Company shall reserve, free from pre-emptive rights, out of its
authorized but unissued shares, sufficient shares to provide for the conversion
of the Securities from time to time as such Securities are presented for
conversion, provided, that nothing contained herein shall be construed to
--------
preclude the Company from satisfying its obligations in respect of the
conversion of Securities by delivery of repurchased shares of Common Stock which
are held in the treasury of the Company.
84
<PAGE>
If any shares of Common Stock to be reserved for the purpose of
conversion of Securities hereunder require registration with or approval of any
governmental authority under any Federal or state law before such shares may be
validly issued or delivered upon conversion, then the Company covenants that it
will in good faith and as expeditiously as possible use its best efforts to
secure such registration or approval, as the case may be, provided, however,
-------- -------
that nothing in this Section 13.9 shall be deemed to limit in any way the
obligations of the Company provided in this Article XIII.
Before taking any action which would cause an adjustment reducing the
Conversion Price below the then par value, if any, of the Common Stock, the
Company will take all corporate action which may, in the Opinion of Counsel, be
necessary in order that the Company may validly and legally issue fully paid and
non-assessable shares of Common Stock at such adjusted Conversion Price.
The Company covenants that all shares of Common Stock which may be
issued upon conversion of Securities will upon issue be fully paid and non-
assessable by the Company and free of preemptive rights.
SECTION 13.10. Disclaimer of Responsibility for Certain Matters.
------------------------------------------------
Neither the Trustee nor any agent of the Trustee shall at any time be
under any duty or responsibility to any Holder of Securities to determine
whether any facts exist which may require any adjustment of the Conversion
Price, or with respect to the Officers' Certificate referred to in Section 13.5
hereof, or with respect to the nature or extent of any such adjustment when
made, or with respect to the method employed, or herein or in any supplemental
indenture provided to be employed, in making the same. Neither the Trustee nor
any agent of the Trustee shall be accountable with respect to the validity or
value (or the kind or amount) of any shares of Common Stock, or of any
securities or property (including cash), which may at any time be issued or
delivered upon the conversion of any Security; and neither the Trustee nor any
conversion agent makes any representation with respect thereto. Neither the
Trustee nor any agent of the Trustee shall be responsible for any failure of the
Company to issue, register the transfer of or deliver any shares of Common Stock
or stock certificates or other securities or property (including cash) upon the
85
<PAGE>
surrender of any Security for the purpose of conversion or, subject to Article
VIII hereof, to comply with any of the covenants of the Company contained in
this Article XIII.
SECTION 13.11. Return of Funds Deposited for Redemption of Converted
-----------------------------------------------------
Securities.
- ----------
Any funds which at any time shall have been deposited by the Company
or on its behalf with the Trustee or any other Paying Agent for the purpose of
paying the principal of and interest on any of the Securities and which shall
not be required for such purposes because of the conversion of such Securities,
as provided in this Article XIII, shall after such conversion be repaid to the
Company by the Trustee or such other Paying Agent.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1. TIA Controls.
------------
If any provision of this Indenture limits, qualifies, or conflicts
with the duties imposed by operation of the TIA, the imposed duties, upon
qualification of this Indenture under the TIA, shall control.
SECTION 14.2. Notices.
-------
Any notices or other communications to the Company or the Trustee
required or permitted hereunder shall be in writing, and shall be sufficiently
given if made by hand delivery, by telex, by telecopier or registered or
certified mail, postage prepaid, return receipt requested, addressed as follows:
if to the Company:
United States Filter Corporation
73-710 Fred Waring Drive
Suite 222
Palm Desert, California 92260
Attention: Chief Financial Officer
Telecopy: (619) 341-9368
if to the Trustee:
86
<PAGE>
The First National Bank of Boston
150 Royall Street
Canton, Massachusetts 02021
Attention: Corporate Trust Division,
Mail Stop 45-02-15
Telecopy: (617) 575-2078
Any party by notice to each other party may designate additional or
different addresses as shall be furnished in writing by such party. Any notice
or communication to any party shall be deemed to have been given or made as of
the date so delivered, if personally delivered; when answered back, if telexed;
when receipt is acknowledged, if telecopied; and five Business Days after
mailing if sent by registered or certified mail, postage prepaid (except that a
notice of change of address shall not be deemed to have been given until
actually received by the addressee) .
Any notice or communication mailed to a Securityholder shall be mailed
to him by first class mail or other equivalent means at his address as it
appears on the registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 14.3. Communications by Holders with Other Holders.
--------------------------------------------
Securityholders may communicate pursuant to TIA (S) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other Person shall
have the protection of TIA (S) 312(c).
SECTION 14.4. Certificate and Opinion as to Conditions Precedent.
--------------------------------------------------
87
<PAGE>
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate (in form and substance reasonably
satisfactory to the Trustee) stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(2) an Opinion of Counsel (in form and substance reasonably
satisfactory to the Trustee) stating that, in the opinion of such counsel, all
such conditions precedent have been complied with.
SECTION 14.5. Statements Required in Certificate or Opinion.
---------------------------------------------
Each certificate or opinion 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 each
such Person, such condition or covenant has been complied with; provided,
--------
however, that with respect to matters of fact an Opinion of Counsel may rely on
- -------
an Officers' Certificate or certificates of public officials.
88
<PAGE>
SECTION 14.6. Rules by Trustee, Paying Agent, Registrar.
-----------------------------------------
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Paying Agent or Registrar may make reasonable rules for
its functions.
SECTION 14.7. Legal Holidays.
--------------
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in New York, New York are authorized or obligated by law or
executive order to close. If a payment date is a Legal Holiday at such place,
payment may be made at such place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.
SECTION 14.8. Governing Law.
-------------
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS
MADE AND PERFORMED WITHIN THE STATE OF NEW YORK. THE COMPANY HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH
OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH
OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE AND THE SECURITIES, AND
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. THE COMPANY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY
SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY
SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE TRUSTEE OR ANY
SECURITYHOLDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE COMPANY IN ANY OTHER
JURISDICTION.
89
<PAGE>
SECTION 14.9. No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any of its Subsidiaries. Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.
SECTION 14.10. No Recourse Against Others.
--------------------------
No direct or indirect partner, employee, stockholder, director or
officer, as such, past, present or future of the Company or any successor
corporation, shall have any personal liability in respect of the obligations of
the Company under the Securities or this Indenture by reason of his, her or its
status as such partner, stockholder, employee, director or officer. Each
Securityholder by accepting a Security waives and releases all such liability.
Such waiver and release are part of the consideration for the issuance of the
Securities.
SECTION 14.11. Successors.
----------
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
SECTION 14.12. Duplicate Originals.
-------------------
All parties may sign any number of copies or counterparts of this
Indenture. Each signed copy or counterpart shall be an original, but all of
them together shall represent the same agreement.
SECTION 14.13. Severability.
------------
In case any one or more of the provisions in this Indenture or in the
Securities shall be held invalid, illegal or unenforceable, in any respect for
any reason, the validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions shall not in any way be
affected or impaired thereby, it being intended that all of the provisions
hereof shall be enforceable to the full extent permitted by law.
90
<PAGE>
SECTION 14.14. Table of Contents, Headings, Etc.
---------------------------------
The Table of Contents, Cross-Reference Table and headings of the
Articles and the Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 14.15. Qualification of Indenture.
--------------------------
The Company shall qualify this Indenture under the TIA in accordance
with the terms and conditions of the Registration Rights Agreement and shall pay
all costs and expenses (including attorneys' fees for the Company and the
Trustee) incurred in connection therewith, including, but not limited to, costs
and expenses of qualification of the Indenture and the Securities and printing
this Indenture and the Securities. The Trustee shall be entitled to receive from
the Company any such Officers' Certificates, Opinions of Counsel or other
documentation as it may reasonably request in connection with any such
qualification of this Indenture under the TIA.
SECTION 14.16. Registration Rights.
-------------------
Certain Holders of the Securities are entitled to certain registration
rights with respect to such Securities pursuant to, and subject to the terms of,
the Registration Rights Agreement.
91
<PAGE>
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first written above.
UNITED STATES FILTER
CORPORATION, a
Delaware corporation
[Seal]
By: /s/KEVIN L. SPENCE
------------------------------------
Name: Kevin L. Spence
----------------------------
Title: Vice President and
----------------------------
Chief Financial Officer
----------------------------
Attest: /s/ DAMIAN C. GEORGINO
----------------------------
Secretary
Damian C. Georgino
Vice President, THE FIRST NATIONAL BANK OF BOSTON,
General Counsel a national banking association
and Secretary
as Trustee
By: /s/ J.E. MOGAVERO
------------------------------------
Name: J.E. Mogavero
----------------------------
Title: Authorized Officer
----------------------------
<PAGE>
Exhibit A
[FORM OF SECURITY]
UNITED STATES FILTER CORPORATION
6% CONVERTIBLE SUBORDINATED NOTE
DUE 2005
No. CUSIP No. ____________
$ _______
United States Filter Corporation, a Delaware corporation (hereinafter
called the "Company," which term includes any successors under the Indenture
hereinafter referred to), for value received, hereby promises to pay to _____,
or registered assigns, the principal sum of _____ Dollars, on September 15,
2005.
Interest Payment Dates: March 15 and September 15; commencing March
15, 1996.
Record Dates: March 1 and September 1.
Reference is made to the further provisions of this Security on the
reverse side, which will, for all purposes, have the same effect as if set forth
at this place.
IN WITNESS WHEREOF, the Company has caused this Instrument to be duly
executed under its corporate seal.
Dated: September __, 1995
UNITED STATES FILTER
CORPORATION, a
Delaware corporation
[Seal]
By:
-------------------------------------
Name:
Title:
Attest:
---------------
Secretary
A-1
<PAGE>
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Securities described in the within-mentioned
Indenture.
_________________________________________,
as Trustee
By
-------------------------------------------
Authorized Signatory
Dated:
A-2
<PAGE>
UNITED STATES FILTER CORPORATION
6% CONVERTIBLE SUBORDINATED NOTE
DUE 2005
Unless and until it is exchanged in whole or in part for Securities in
definitive form, this Security may not be transferred except as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary. Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to the Company or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein./1/
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") WHICH IS THREE YEARS AFTER THE LATER
OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR
ANY AFFILIATED PERSON OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH
- ---------------------------
/1/ This paragraph should only be added if the Security is issued in global
form.
A-3
<PAGE>
SECURITY) EXCEPT (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C)
PURSUANT TO RULE 144A, FOR SO LONG AS IT IS AVAILABLE, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND
SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION
S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR,"
WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES
ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT
OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND
NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (D), (E) OR (F) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND OTHER INFORMATION
SATISFACTORY TO EACH OF THEM, AND IN EACH OF THE FOREGOING CASES, A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS SECURITY IS COMPLETED
AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE./2/
1. Interest.
--------
United States Filter Corporation, a Delaware corporation (hereinafter
called the "Company," which term includes any successors under the Indenture
hereinafter referred to), promises to pay interest on the principal amount of
this Security at the rate of 6% per annum. To the extent it is lawful, the
Company promises to pay interest on any
- ---------------------------
/2/ This paragraph should be included only for the Transfer Restricted
Securities.
A-4
<PAGE>
interest payment due but unpaid on such principal amount at a rate of 6% per
annum compounded semi-annually.
The Company will pay interest semi-annually on March 15 and September
15 of each year (each, an "Interest Payment Date"), commencing March 15, 1996.
Interest on the Securities will accrue from the most recent date to which
interest has been paid or, if no interest has been paid on the Securities, from
September 18, 1995. Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months.
2. Method of Payment.
-----------------
The Company shall pay interest on the Securities (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date. Holders must
surrender Securities to a Paying Agent to collect principal payments. Any such
interest not so punctually paid, and defaulted interest relating thereto, may be
paid to the Persons who are registered Holders at the close of business on a
Special Record Date for the payment of such defaulted interest, as more fully
provided in the Indenture referred to below. Except as provided below, the
Company shall pay principal and interest in such coin or currency of the United
States of America as at the time of payment shall be legal tender for payment of
public and private debts ("U.S. Legal Tender"). The Securities will be payable
as to principal, premium, interest and Liquidated Damages at the office or
agency of the Company maintained for such purpose within or without the City and
State of New York, or at the option of the Company, payment of principal,
premium, interest and Liquidated Damages may be made by check mailed to the
Holders at their addresses set forth in the registry of Holders, and provided
that payment by wire transfer of immediately available funds will be required
with respect to principal of, premium and interest on and Liquidated Damages
with respect to Global Securities and all other Securities the Holders of which
shall have provided wire transfer instructions to the Company or the Paying
Agent.
3. Paying Agent and Registrar.
--------------------------
Initially, The First National Bank of Boston (the "Trustee") will act
as Paying Agent and Registrar. The Company may change any Paying Agent,
Registrar or co-Regis-
A-5
<PAGE>
trar without notice to the Holders. The Company or any of its Subsidiaries may,
subject to certain exceptions, act as Paying Agent, Registrar or co-Registrar.
4. Indenture.
---------
The Company issued the Securities under an Indenture, dated as of
September 18, 1995 (the "Indenture"), between the Company and the Trustee.
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act, as in effect on the date of the Indenture. The Securities are
subject to all such terms, and Holders of Securities are referred to the
Indenture and said Act for a statement of them. The Securities are general
unsecured obligations of the Company limited in aggregate principal amount to
$143,750,000.
5. Redemption.
----------
The Securities may be redeemed in whole or from time to time in part
at any time on and after September 23, 1998, at the option of the Company, at
the Redemption Price (expressed as a percentage of principal amount) set forth
below with respect to the indicated Redemption Date, in each case, plus any
accrued but unpaid interest and Liquidated Damages to the Redemption Date. The
Securities may not be so redeemed prior to September 23, 1998.
If redeemed during
the 12-month period
beginning September 15 Redemption Price
---------------------- ----------------
1998 ................. 103.75%
1999 ................. 103.00%
2000 ................. 102.25%
2001 ................. 101.50%
2002 ................. 100.75%
2003 and thereafter .. 100%
Any such redemption will comply with Article III of the Indenture.
A-6
<PAGE>
6. Notice of Redemption.
--------------------
Notice of redemption will be sent by first class mail, at least 30
days and not more than 60 days prior to the Redemption Date to the Holder of
each Security to be redeemed at such Holder's last address as then shown upon
the registry books of the Registrar. Securities may be redeemed in part in
multiples of $1,000 only.
Except as set forth in the Indenture, from and after any Redemption
Date, if monies for the redemption of the Securities called for redemption shall
have been deposited with the Paying Agent on such Redemption Date and payment of
the Securities called for redemption is not prohibited under Article XII of the
Indenture, the Securities called for redemption will cease to bear interest and
the only right of the Holders of such Securities will be to receive payment of
the Redemption Price, plus any accrued and unpaid interest and Liquidated
Damages, if any, to the Redemption Date.
7. Denominations; Transfer; Exchange.
---------------------------------
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder may register
the transfer of, or exchange Securities in accordance with, the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange any Securities selected for redemption.
8. Persons Deemed Owners.
---------------------
The registered Holder of a Security may be treated as the owner of it
for all purposes.
9. Unclaimed Money.
---------------
If money for the payment of principal, interest or Liquidated Damages
remains unclaimed for two years, the Trustee and the Paying Agent(s) will pay
the money back to the Company at its written request. After that, all liability
of the Trustee and such Paying Agent(s) with respect to such money shall cease.
A-7
<PAGE>
10. Amendment; Supplement; Waiver.
-----------------------------
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented, and any existing Default or Event of Default or
compliance with any provision may be waived, with the written consent of the
Holders of a majority in aggregate principal amount of the Securities then
outstanding. Without notice to or consent of any Holder, the parties thereto
may amend or supplement the Indenture or the Securities to, among other things,
cure any ambiguity, defect or inconsistency, or make any other change that does
not adversely affect the rights of any Holder of a Security.
11. Conversion Rights.
-----------------
Subject to the provisions of the Indenture, the Holders have the right
to convert the principal amount of the Securities into fully paid and
nonassessable shares of Common Stock of the Company at the initial conversion
price per share of Common Stock of $27.50 (or $27.50 in principal amount of
Securities for each such share of Common Stock), or at the adjusted conversion
price then in effect, if adjustment has been made as provided in the Indenture,
upon surrender of the Security to the Company, together with a fully executed
notice in substantially the form attached hereto and, if required by the
Indenture, an amount equal to accrued interest payable on such Security.
12. Ranking.
-------
Payment of principal, premium, if any, interest on and Liquidated
Damages with respect to the Securities is subordinated, in the manner and to the
extent set forth in the Indenture, to the prior payment in full of all Senior
Indebtedness.
13. Repurchase at Option of Holder Upon a Change of Control.
-------------------------------------------------------
If there is a Change of Control, the Company shall be required to
offer to purchase on the Repurchase Date all outstanding Securities at a
purchase price equal to 101% of the principal amount thereof, plus accrued and
unpaid interest and Liquidated Damages, if any, to the Repurchase Date. Holders
of Securities will receive a Repurchase Offer from the Company prior to any
related Repurchase Date and may
A-8
<PAGE>
elect to have such Securities purchased by completing the form entitled "Option
of Holder to Elect Purchase" appearing below.
14. Successors.
----------
When a successor assumes all the obligations of its predecessor under
the Securities and the Indenture, the predecessor will be released from those
obligations.
15. Defaults and Remedies.
---------------------
If an Event of Default occurs and is continuing (other than as Event
of Default relating to certain events of bankruptcy, insolvency or
reorganization), then in every such case, unless the principal of all of the
securities shall have already become due and payable, either the Trustee or the
Holders of 25% in aggregate principal amount of Securities then outstanding may
declare all the Securities to be due and payable immediately in the manner and
with the effect provided in the Indenture. Holders of Securities may not
enforce the Indenture or the Securities except as provided in the Indenture.
The Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Securities. Subject to certain limitations, Holders of a
majority in aggregate principal amount of the Securities then outstanding may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of Securities notice of any continuing Default or Event of
Default (except a Default in payment of principal, interest or Liquidated
Damages), if it determines that withholding notice is in their interest.
16. Trustee Dealings with Company.
-----------------------------
The Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates as if it were not the Trustee.
17. No Recourse Against Others.
--------------------------
No stockholder, director, officer or employee, as such, past, present
or future, of the Company or any successor corporation shall have any personal
liability in respect of the obligations of the Company under the Securities or
A-9
<PAGE>
the Indenture by reason of his, her or its status as such stockholder, director,
officer or employee. Each Holder of a Security by accepting a Security waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
18. Authentication.
--------------
This Security shall not be valid until the Trustee or authenticating
agent signs the certificate of authentication on the other side of this
Security.
19. Abbreviations and Defined Terms.
-------------------------------
Customary abbreviations may be used in the name of a Holder of a
Security 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).
20. CUSIP Numbers.
-------------
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to be
printed on the Securities as a convenience to the Holders of the Securities. No
representation is made as to the accuracy of such numbers as printed on the
Securities and reliance may be placed only on the other identification numbers
printed hereon.
21. Additional Rights of Holders of Transfer Restricted Securities.
--------------------------------------------------------------
In addition to the rights provided to Holders of Securities under the
Indenture, Holders of Securities shall have all the rights set forth in the
Registration Rights Agreement.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Request may be made to:
United States Filter Corporation
73-710 Fred Waring Drive
Suite 222
A-10
<PAGE>
Palm Desert, California 92260
Attention: Assistant Secretary
A-11
<PAGE>
[FORM OF] ASSIGNMENT
I or we assign this Security to
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee)
Please insert Social Security or other identifying number of assignee
_________________________
and irrevocably appoint __________ agent to transfer this Security on the books
of the Company. The agent may substitute another to act for him.
Dated: __________ Signed: ____________________________________________________
________________________________________________________________________________
(Sign exactly as name appears on
the other side of this Security)
A-12
<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Article XI of the Indenture, check the box: /___/
If you want to elect to have only part of this Security purchased by
the Company pursuant to Article XI of the Indenture, state the amount you want
to be purchased: $________
Date: ________________ Signature: _____________________________________________
(Sign exactly as your name appears on the
other side of this Security)
A-13
<PAGE>
SCHEDULE OF EXCHANGES OF DEFINITIVE SECURITIES/3/
The following exchanges of a part of this Global Security for
Definitive Securities have been made:
<TABLE>
<CAPTION>
Amount of Amount of Principal Amount Signature of
decrease in increase in of this Global authorized officer
Principal Amount Principal Amount Security following of Trustee or
Date of of this Global of this Global such decrease (or Securities
Exchange Security Security increase) Custodian
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
</TABLE>
- ---------------------------
/3/ This schedule should only be added if the Security is issued in global
form.
A-14
<PAGE>
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF
SECURITIES
Re: 6% CONVERTIBLE SUBORDINATED NOTES DUE 2005 OF UNITED STATES FILTER
CORPORATION.
This Certificate relates to $______ principal amount of Securities held in
*_____ book-entry or * ______ definitive form by _____ (the "Transferor").
1. The Transferor:*
[_] (a) has requested the Trustee by written order to deliver in exchange for
its beneficial interest in the Global Security held by the Depositary a Security
or Securities in definitive, registered form of authorized denominations and an
aggregate principal amount equal to its beneficial interest in such Global
Security (or the portion thereof indicated above); or
[_] (b) has requested the Trustee by written order to exchange or register the
transfer of a Security or Securities.
2. In connection with any such request and in respect of each such
Security, the Transferor does hereby certify that Transferor is familiar with
the Indenture relating to the above-captioned Securities and as provided in
Section 2.6 of such Indenture, the transfer of this Security does not require
registration under the Securities Act because:/*/
[_] (a) Such Security is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 2.6(a)(ii)(A) or Section
2.6(d)(i)(A) of the Indenture).
[_] (b) Such Security is being transferred to a person who the Transferor
reasonably believes is a "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) purchasing for its own account or for the account
of a qualified institutional buyer over which it exercises sole investment
discretion that is aware that the transfer is
- ---------------------------
*Check applicable box.
A-15
<PAGE>
being made in reliance on Rule 144A (in satisfaction of Section 2.6(a)(ii)(B),
Section 2.6(b)(i) or Section 2.6(d)(i)(B) of the Indenture).
[_] (c) Such Security is being transferred pursuant to an exemption from
registration in accordance with Regulation S under the Securities Act (in
satisfaction of Section 2.6(a)(ii)(C) or Section 2.6 (d)(i)(C) of the
Indenture).
[_] (d) Such Security is being transferred to an institutional investor
that is an "accredited investor" within the meaning of Rule 501(a)(1),(2),(3) or
(7) under the Securities Act which delivers a certificate in the form of Exhibit
A to the Indenture to the Trustee (in satisfaction of Section 2.6(a)(ii)(D) or
Section 2.6(d)(i)(D) of the Indenture).
[_] (e) Such Security is being transferred in reliance on and in compliance
with another exemption from the registration requirements of the Securities Act.
An Opinion of Counsel to the effect that such transfer does not require
registration under the Securities Act accompanies this Certificate (in
satisfaction of Section 2.6(a)(ii)(E) or Section 2.6(d)(i)(E) of the Indenture).
------------------------------------------
[INSERT NAME OF TRANSFEROR]
By:
---------------------------------------
Date:
-------------------------------
3. Affiliation with the Company [check if applicable]
[ ] (a) The undersigned represents and warrants that it is, or at some time
during which it held this Security was, an Affiliate of the Company.
A-16
<PAGE>
(b) If 3(a) above is checked and if the undersigned was not an Affiliate
---
of the Company at all times during which it held this Security,
indicate the periods during which the undersigned was an Affiliate of
the Company:
________________________________.
(c) If 3(a) above is checked and if the Transferee will not pay the full
---
purchase price for the transfer of this Security on or prior to the
date of transfer indicate when such purchase price will be paid:
________________________________.
TO BE COMPLETED BY TRANSFEREE IF 2(b) ABOVE IS CHECKED AND THE TRANSFEROR IS NOT
A QUALIFIED INSTITUTIONAL BUYER:
The undersigned represents and warrants that it is a "qualified
institutional buyer" as defined in Rule 144A under the Securities Act of 1933,
as amended, and acknowledges that it has received such information regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information.
Dated:_______________ ___________________________________________________
NOTICE: To be executed by
an officer.
TO BE COMPLETED BY TRANSFEREE IF 2(c) ABOVE IS CHECKED:
The undersigned represents and warrants that it is not a "U.S. Person"
(as defined in Regulation S under the Securities Act of 1933, as amended).
Dated:_______________ ___________________________________________________
NOTICE: To be executed by
an officer.
If none of the boxes under Section 2 of this certificate is checked or if any of
the above representations required to be made by the Transferee is not made, the
Registrar shall not be obligated to register this Security in the name of any
person other than the Holder hereof.
THE UNDERSIGNED HEREBY AGREES THAT, UNLESS THE BOX ABOVE UNDER ITEM 3(a) IS
CHECKED, THE UNDERSIGNED SHALL BE DEEMED
A-17
<PAGE>
TO HAVE REPRESENTED THAT IT IS NOT NOR HAS IT BEEN AT ANY TIME DURING WHICH IT
HELD THIS SECURITY AN AFFILIATE, AS DEFINED IN RULE 144 UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OF THE COMPANY.
Dated:_______________ ____________________________________________________
NOTICE: The signature of the Holder to this
assignment must correspond with the name as written
upon the face of this Security particular, without
alteration or enlargement or any change whatsoever.
A-18
<PAGE>
EXHIBIT B
---------
INVESTOR LETTER OF REPRESENTATION
United States Filter Corporation
c/o the Trustee
Ladies and Gentlemen:
This letter is delivered by the undersigned to request a transfer of
$_____ principal amount of the Convertible Subordinated Notes due 2005 (the
"Notes") of United States Filter Corporation (the "Company"). The Notes are
described in that certain Offering Memorandum (the "Offering Memorandum") dated
September 13, 1995 relating to the offering of the Notes. We acknowledge
receipt of the Offering Memorandum and acknowledge that we have read the
Offering Memorandum, including the information on page 3, have had access to
such financial and other information and have been afforded the opportunity to
ask such questions of representatives of the Company and receive answers
thereto, as we deem necessary in connection with our decision to purchase the
Notes.
Upon transfer the Notes would be registered in the name of the
undersigned:
Name: _______________________________________________________________
Address: ____________________________________________________________
Taxpayer ID Number: _________________________________________________
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended
(the "Securities Act")), purchasing for our own account or for the account
of such an institutional "accredited investor," and we are acquiring the
Notes for investment purposes and not with a view to, or for offer or sale
in connection with any distribution in violation of the Securities Act and
we have such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risk of our investment in the
Notes and invest in or purchase securities similar to the Notes in the
normal course of our business, and we, and any accounts for which we are
acting, are each able to bear the economic risk of our or its investment.
We confirm that neither the Company nor any person acting on its behalf has
offered to sell the Notes by, and that we have not been made aware of the
offering of the Notes by, any form of general solicitation or general
advertising, including, but not limited to, any advertisement, article,
notice or other communication published in any newspaper, magazine or
similar media or broadcast over television or radio.
B-1
<PAGE>
2. We understand that the Notes have not been registered under the
Securities Act and, unless so registered, may not be sold except as
permitted in the following sentence. We agree on our own behalf and on
behalf of any investor account for which we are purchasing Notes not to
offer, sell or otherwise transfer such Notes prior to the date which is
three years after the later of the date of original issue and the last date
on which the Company or any affiliate of the Company was the owner of such
Notes (or any predecessor thereto) (the "Resale Restriction Termination
Date") except (a) to the Company, (b) pursuant to a registration statement
that has been declared effective under the Securities Act, (c) pursuant to
Rule 144A under the Securities Act, for so long as it is available, to a
person we reasonably believe is a qualified institutional buyer under Rule
144A under the Securities Act (a "QIB") that purchases for its own account
or for the account of a QIB and to whom notice is given that the transfer
is being made in reliance on Rule 144A, (d) pursuant to offers and sales
that occur outside the United States within the meaning of Regulation S
under the Securities Act, (e) to an institutional "accredited investor"
within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities
Act that is purchasing for its own account or for the account of an
institutional "accredited investor," in each case, with respect to the
Notes, or (f) pursuant to any other available exemption from the
registration requirements of the Securities Act, subject in each of the
foregoing cases to any requirement of law that the disposition of our
property or the property of such investor account or accounts be at all
times within our or their control and in compliance with any applicable
state securities laws. The foregoing restrictions on resale will not apply
subsequent to the Resale Restriction Termination Date. If any resale or
other transfer of the Notes is proposed to be made pursuant to clause (e)
above prior to the Resale Restriction Termination Date, the transferor
shall deliver a letter from the transferee substantially in the form of
this letter to the Company and the trustee (the "Trustee") under the
indenture, dated as of September 18, 1995, between the Company and the
Trustee relating to the Notes, which shall provide, among other things,
that the transferee is an institutional "accredited investor" within the
meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act and
that it is acquiring such Notes for investment purposes and not for
distribution in violation of the Securities Act. Each purchaser
acknowledges that the Company and the Trustee reserve the right prior to
any offer, sale or other transfer, prior to the Resale Restriction
Termination Date of the Notes pursuant to clause (d), (e) or (f) above to
require the delivery of an opinion of counsel, certifications and/or other
information satisfactory to the Company and the Trustee.
3. We understand that the Notes will be in the form of definitive
physical certificates bearing the legend set forth in clause (4) in the
"Notice to Investors" section of the Offering Memorandum.
We acknowledge that you, the Initial Purchasers and others will rely
upon our confirmations, acknowledgements and agreements set forth herein, and we
agree to notify you promptly in writing if any of
B-2
<PAGE>
our representations and warranties herein ceases to be accurate and complete.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
________________________
By: ____________________
B-3
<PAGE>
EXHIBIT C
---------
FORM OF CONVERSION NOTICE
-------------------------
To: United States Filter Corporation
The undersigned owner of this Security hereby: (i) irrevocably
exercises the option to convert this Security, or the portion hereof below
designated, for shares of Common Stock of United States Filter Corporation in
accordance with the terms of this Indenture referred to in this Security and
(ii) directs that such shares of Common Stock deliverable upon the conversion,
together with any check in payment for fractional shares and any Security(ies)
representing any unconverted principal amount hereof, be issued and delivered to
the registered holder hereof unless a different name has been indicated below.
If shares are to be delivered registered in the name of a person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect
thereto. Any amount required to be paid by the undersigned on account of
interest accompanies this Security.
Dated ___________________
________________________________________
Signature
Fill in for registration of shares if to be delivered, and of
Securities if to be issued, otherwise than to and in the name of the registered
holder.
________________________________________
Social Security or other
Taxpayer Identifying Number
________________________________
(Name)
________________________________
(Street Address)
________________________________
(City, State and Zip Code)
(Please print name and address)
Principal amount to be
converted: (if less than all)
$_______________________________________
C-1
<PAGE>
EXHIBIT 4.4
6% CONVERTIBLE SUBORDINATED NOTES DUE 2005
REGISTRATION RIGHTS AGREEMENT
DATED AS OF SEPTEMBER 18, 1995
BY AND AMONG
UNITED STATES FILTER CORPORATION
AS THE COMPANY,
AND
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
AND
PAINEWEBBER INCORPORATED
AS PURCHASERS
<PAGE>
This Registration Rights Agreement is made and entered into as of September
18, 1995, by and among United States Filter Corporation, a Delaware corporation
(the "Company"), and Donaldson, Lufkin & Jenrette Securities Corporation and
PaineWebber Incorporated (the "Purchasers").
This Agreement is made pursuant to the Purchase Agreement, dated September
13, 1995, among the Company and the Purchasers (the "Purchase Agreement"). In
order to induce the Purchasers to enter into the Purchase Agree ment, the
Company has agreed to provide the registration rights provided for in this
Agreement to the Purchasers and their respective direct and indirect
transferees. The execution of this Agreement is a condition to the closing of
the transactions contemplated by the Purchase Agreement.
The parties hereby agree as follows:
I. Definitions
-----------
As used in this Agreement, the following terms shall have the follow ing
meanings:
Advice: As defined in the last paragraph of Section 4(r) hereof.
------
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," when used with respect to any person, means the power to direct the
management and policies of such person, directly or indirectly, whether through
the ownership of voting securi ties, by contract or otherwise and the terms
"affiliated," "controlling" and "controlled" have meanings correlative to the
foregoing.
Agreement: This Registration Rights Agreement, as the same may be amended,
---------
supplemented or modified from time to time in accordance with the terms hereof.
Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday that is
------------
not a day on which banking institutions in New York, New York are authorized or
obligated by law or executive order to close.
Closing Date: The Closing Date as defined in the Purchase Agreement.
------------
<PAGE>
Common Stock: Common Stock, $.01 par value per share of the Company.
------------
Company: United States Filter Corporation, a Delaware corporation, and any
-------
successor corporation thereto.
controlling person: As defined in Section 6(a) hereof.
------------------
Damage Payment Date: Each of the semi-annual interest payment dates
-------------------
provided in the Indenture.
Effectiveness Period: As defined in Section 2(a) hereof.
--------------------
Effectiveness Target Date: The 120th day following the Closing Date.
-------------------------
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
------------
rules and regulations promulgated by the SEC pursuant thereto.
Filing Date: The 90th day after the Closing Date.
-----------
Holder: Each registered holder of any Transfer Restricted Securities.
------
Indemnified Person: As defined in Section 6(a) hereof.
------------------
Indenture: The Indenture, dated the date hereof, between the Company and
---------
the Trustee thereunder, pursuant to which the Notes are being issued, as
amended, modified or supplemented from time to time in accordance with the terms
thereof.
Liquidated Damages: As defined in Section 3(a) hereof.
------------------
Notes: The $140,000,000 aggregate principal amount of 6% Convertible
-----
Subordinated Notes due 2005 of the Company being issued pursuant to the
Indenture.
Paying Agent: As defined in the Indenture.
------------
3
<PAGE>
Proceeding: An action, claim, suit or proceeding (including, without
----------
limitation, an investigation or partial proceeding, such as a deposition),
whether commenced or threatened.
Prospectus: The prospectus included in any Registration Statement
----------
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated pursuant to the Securities
Act), as amended or supplemented by any prospectus supplement, with respect to
the terms of the offering of any portion of the Transfer Restricted Securities
covered by such Registration Statement, and all other amendments and supplements
to any such prospectus, including post-effective amendments, and all material
incorporated by reference or deemed to be incorporated by reference, if any, in
such prospectus.
Purchasers: As defined in the preamble hereof.
----------
Registration Default: As defined in Section 3(a) hereof.
--------------------
Registration Statement: Any registration statement of the Company that
----------------------
covers any of the Notes pursuant to the provisions of this Agreement, including
the Prospectus, amendments and supplements to such registration statement or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference, if any, in such registration statement.
Rule 144: Rule 144 promulgated by the SEC pursuant to the Securities Act,
--------
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC as a replacement thereto having substantially the
same effect as such Rule.
Rule 144A: Rule 144A promulgated by the SEC pursuant to the Securities
---------
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 158: Rule 158 promulgated by the SEC pursuant to the Securities Act,
--------
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC as a replacement thereto having substantially the
same effect as such Rule.
4
<PAGE>
Rule 174: Rule 174 promulgated by the SEC pursuant to the Securities Act,
--------
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC as a replacement thereto having substantially the
same effect as such Rule.
Rule 415: Rule 415 promulgated by the SEC pursuant to the Securities Act,
--------
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC as a replacement thereto having substantially the
same effect as such Rule.
Rule 424: Rule 424 promulgated by the SEC pursuant to the Securities Act,
--------
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC as a replacement thereto having substantially the
same effect as such Rule.
SEC: The Securities and Exchange Commission.
---
Securities Act: The Securities Act of 1933, as amended, and the rules and
--------------
regulations promulgated by the SEC thereunder.
Shelf Registration: As defined in Section 2 hereof.
------------------
Special Counsel: Any special counsel to the holders of Transfer Restricted
---------------
Securities, for which holders of Transfer Restricted Securities will be
reimbursed pursuant to Section 5 hereof.
TIA: The Trust Indenture Act of 1939, as amended.
---
Transfer Restricted Securities: The Notes and the shares of Common Stock
------------------------------
into which the Notes are convertible, upon original issuance thereof, and at all
times subsequent thereto, until, in the case of any such Note or share, (i) the
date on which it has been registered effectively pursuant to the Securities Act
and disposed of in accordance with the Registration Statement relating to it,
(ii) the date on which either such Note or the shares of Common Stock issued
upon conversion of such Note are distributed to the public pursuant to Rule 144
(or any similar provisions then in effect) or are saleable pursuant to Rule
144(k) promulgated by the SEC pursuant to the Securities Act or (iii) the date
on which it ceases to be outstanding.
5
<PAGE>
Trustee: The First National Bank of Boston, the trustee under the
-------
Indenture.
underwritten registration or underwritten offering: A registration in
--------------------------------------------------
connection with which securities of the Company are sold to an underwriter for
reoffering to the public pursuant to an effective Registration Statement.
2. Shelf Registration
------------------
(a) The Company agrees to file with the SEC as soon as practicable after
the Closing Date, but in no event later than the Filing Date, a Registration
Statement for an offering to be made on a continuous basis pursuant to Rule 415
covering all of the Transfer Restricted Securities (the "Shelf Registration").
The Shelf Registration shall be on Form S-3 under the Securities Act or another
appropriate form permitting registration of such Transfer Restricted Securities
for resale by the Holders in the manner or manners reasonably designated by them
(including, without limitation, one or more underwritten offerings). The
Company shall not permit any securities other than the Transfer Restricted
Securities to be included in the Shelf Registration. The Company shall use its
reasonable best efforts, as described in Section 4, to cause the Shelf
Registration to be declared effective pursuant to the Securities Act as promptly
as practicable following the filing thereof, but in no event later than the
Effectiveness Target Date, and to keep the Shelf Registration continuously
effective under the Securities Act for 36 months after the Closing Date (subject
to extension pursuant to the last paragraph of Section 4(q) hereof) (the
"Effectiveness Period"), or such shorter period ending when either (1) all
Transfer Restricted Securities covered by the Shelf Registration have been sold
in the manner set forth and as contemplated in the Shelf Registration or (2)
there cease to be outstanding any Transfer Restricted Securities.
(b) Supplements and Amendments. The Company shall use its reasonable best
--------------------------
efforts to keep the Shelf Registration continuously effective by supplementing
and amending the Shelf Registration if required by the rules, regulations or
instructions applicable to the registration form used for such Shelf
Registration, if required by the Securities Act, or if reasonably requested by
the holders of a majority in aggregate principal amount of the Transfer
Restricted Securities covered by such Registration Statement or by any
underwriter of such Transfer Restricted Securities; provided that the
Effectiveness Period shall be extended to the extent required to permit dealers
to comply with the applicable prospectus delivery requirements of Rule 174 and
as otherwise provided herein.
6
<PAGE>
3. Liquidated Damages
------------------
(a) The Company and the Purchasers agree that the Holders of Transfer
Restricted Securities will suffer damages if the Company fails to fulfill its
obligations pursuant to Section 2 hereof and that it would not be possible to
ascertain the extent of such damages. Accordingly, in the event of such failure
by the Company to fulfill such obligations, the Company hereby agrees to pay
liquidated damages ("Liquidated Damages") to each Holder of Transfer Restricted
Securities under the circumstances and to the extent set forth below:
(i) if the Shelf Registration has not been filed with the SEC on or
prior to the Filing Date; or
(ii) if the Shelf Registration is not declared effective by the SEC on
or prior to the Effectiveness Target Date; or
(iii) the Shelf Registration has been declared effective by the SEC and
such Shelf Registration ceases to be effective or usable at any time during
the Effectiveness Period (without being succeeded on the same day
immediately by a post-effective amendment to such Registra tion Statement
that cures such failure and that is itself immediately declared effective)
for a period of time which shall exceed 90 days in the aggregate per year.
(any of the foregoing, a "Registration Default") then the Company shall pay
Liqui dated Damages to each Holder of Transfer Restricted Securities during the
first 90-day period immediately following the occurrence of such Registration
Default in an amount equal to $.05 per week per $1,000 principal amount of Notes
and, if applica ble, $.01 per week per share (subject to adjustment in the
event of stock splits, stock recombinations, stock dividends and the like) of
Common Stock constituting Transfer Restricted Securities held by such Holder for
each week or portion thereof that the Registration Default continues. The
amount of such Liquidated Damages will increase by an additional $.05 per week
per $1,000 principal amount of Notes and $.01 per week per share (subject to
adjustment as set forth above) of Common Stock constituting Transfer Restricted
Securities for each subsequent 90-day period until all Registration Defaults
have been cured; provided, however, that Liquidated Damages shall not at any
-------- -------
time exceed $.25 per week per $1,000 principal amount of Notes and $.05 per week
per share (subject to adjustment as set forth above) of Common Stock
constituting Transfer Restricted Securities. Following the cure of all
Registration
7
<PAGE>
Defaults relating to any Transfer Restricted Securities, the accrual of
Liquidated Damages with respect to such Transfer Restricted Securities will
cease. A Registra tion Default under clause (i) above shall be cured on the
date that the Shelf Registration is filed with the SEC; a Registration Default
under clause (ii) above shall be cured on the date that the Shelf Registration
is declared effective by the SEC; and a Registration Default under clause (iii)
above shall be cured on the date the Shelf Registration is declared effective or
usable.
(b) The Company shall notify the Trustee within one Business Day after each
and every date on which a Registration Default occurs. Liquidated Damages shall
be paid by the Company to the Holders by wire transfer of immediately available
funds to the accounts specified by them or by mailing checks to their registered
addresses if no such accounts have been specified on or before the Damage
Payment Date. Each obligation to pay Liquidated Damages shall be deemed to
commence accruing on the date of the applicable Registration Default and to
cease accruing when all Registration Defaults have been cured. In no event
shall the Company pay Liquidated Damages in excess of the applicable maximum
weekly amount set forth above, regardless of whether one or multiple
Registration Defaults exist.
4. Registration Procedures
-----------------------
In connection with the Company's registration obligations hereunder, the
Company shall effect such registrations on the appropriate form available for
the sale of the Transfer Restricted Securities to permit the sale of Transfer
Restricted Securities in accordance with the method or methods of disposition
thereof specified by the holders of a majority in aggregate principal amount of
Transfer Restricted Securities, and pursuant thereto the Company shall as
expeditiously as possible:
(a) No fewer than five Business Days prior to the initial filing of a
Registration Statement or Prospectus and no fewer than two Business Days prior
to the filing of any amendment or supplement thereto (other than any document
that would be incorporated or deemed to be incorporated therein by reference),
furnish to the Holders of the Transfer Restricted Securities, their Special
Counsel and the managing underwriters, if any, copies of all such documents
proposed to be filed, which documents (other than those incorporated or deemed
to be incorporated by reference) will be subject to the review of such Holders,
their Special Counsel and such underwriters, if any, and cause the officers and
directors of the Company, counsel to the Company and independent certified
public
8
<PAGE>
accountants to the Company to respond to such inquiries as shall be necessary in
connection with such Registration Statement, in the opinion of respective
counsel to such Holders and such underwriters, to conduct a reasonable
investigation within the meaning of the Securi ties Act; provided, however, that
-------- -------
the Company shall not be deemed to have kept a Registration Statement effective
during the applicable period if it voluntarily takes or fails to take any action
that results in selling Holders of the Transfer Restricted Securities covered
thereby not being able to sell such Transfer Restricted Securities pursuant to
Federal securities laws during that period (and the time period during which
such Registration Statement is required to remain effective hereunder shall be
extended by the number of days during which such selling Holders of Transfer
Restricted Securities are not able to sell Transfer Restricted Securities). The
Com pany shall not file any such Registration Statement or related Prospectus or
any amendments or supplements thereto to which the Holders of a majority of the
Transfer Restricted Securities, their Special Counsel, or the managing
underwriters, if any, shall reasonably object on a timely basis;
(b) Prepare and file with the SEC such amendments, including post-effective
amendments, to each Registration Statement as may be necessary to keep such
Registration Statement continuously effective for the applicable time period;
cause the related Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424 (or any
similar provisions then in force) under the Securities Act; and comply with the
provisions of the Securities Act and the Exchange Act with respect to the
disposition of all securi ties covered by such Registration Statement during
such period in accordance with the intended methods of disposition by the
sellers thereof set forth in such Registra tion Statement as so amended or in
such Prospectus as so supplemented;
(c) Notify the Holders of Transfer Restricted Securities to be sold or
their Special Counsel and the managing underwriters, if any, promptly (and in
the case of an event specified by clause (i)(A) of this paragraph in no event
fewer than two Business Days prior to such filing), and (if requested by any
such person), confirm such notice in writing, (i)(A) when a Prospectus or any
Prospectus supplement or post-effective amendment is proposed to be filed, and,
(B) with respect to a Registration Statement or any post-effective amendment,
when the same has become effective, (ii) of any request by the SEC or any other
Federal or state governmental authority for amendments or supplements to a
Registration Statement or related Prospectus or for additional information,
(iii) of the issuance by the SEC, any state securities commission, any other
governmental
9
<PAGE>
agency or any court of any stop order, order or injunction suspending or
enjoining the use or the effectiveness of a Registration Statement or the
initiation of any proceedings for that purpose, (iv) if at any time any of the
representations and warranties of the Company contained in any agreement
(including any underwriting agreement) contemplated by Section 4(m) hereof cease
to be true and correct in all material respects, (v) of the receipt by the
Company of any notification with respect to the suspension of the qualification
or exemption from qualification of any of the Transfer Restricted Securities for
sale in any jurisdiction, or the initiation or threatening of any proceeding for
such purpose, and (vi) of the happening of any event that makes any statement
made in such Registration Statement or related Prospectus or any document
incorporated or deemed to be incorporated therein by reference untrue in any
material respect or that requires the making of any changes in such Registration
Statement, Prospectus or documents so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein, not misleading, and that in the case of the Prospectus,
it will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading;
(d) Use its reasonable best efforts to avoid the issuance of, or, if
issued, obtain the withdrawal of any order enjoining or suspending the use or
effectiveness of a Registration Statement or the lifting of any suspension of
the qualification (or exemption from qualification) of any of the Transfer
Restricted Securities for sale in any jurisdiction, at the earliest practicable
moment;
(e) If requested by the managing underwriters, if any, or the Holders of a
majority in aggregate principal amount of the Transfer Restricted Securities
being sold in connection with such offering, (i) promptly incorporate in a
Prospectus supplement or post-effective amendment such information as the
managing underwriters, if any, and such Holders agree should be included
therein, and (ii) make all required filings of such Prospectus supplement or
such post-effective amendment as soon as practicable after the Company has
received notification of the matters to be incorporated in such Prospectus
supplement or post-effective amendment; provided, however, that the Company
-------- -------
shall not be required to take any action pursuant to this Section 4(e) that
would, in the opinion of counsel for the Company, violate applicable law;
10
<PAGE>
(f) Furnish to each Holder of Transfer Restricted Securities, their Special
Counsel and each managing underwriter, if any, without charge, at least one
conformed copy of each Registration Statement and each amendment thereto,
including financial statements (but excluding schedules, all documents
incorporated or deemed to be incorporated therein by reference and all exhibits,
unless requested in writing by such Holder, counsel or managing underwriter);
(g) Deliver to each Holder of Transfer Restricted Securities, their Special
Counsel, and the underwriters, if any, without charge, as many copies of the
Prospectus or Prospectuses (including each form of prospectus) and each
amendment or supplement thereto as such persons reasonably request; and the
Company hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling Holders of Transfer Restricted
Securities and the underwriters, if any, in connection with the offering and
sale of the Transfer Restricted Securities covered by such Prospectus and any
amendment or supplement thereto;
(h) Prior to any public offering of Transfer Restricted Securities, use its
reasonable best efforts to register or qualify or cooperate with the Holders of
Transfer Restricted Securities to be sold or tendered for, the underwriters, if
any, and their respective counsel in connection with the registration or
qualification (or exemption from such registration or qualification) of such
Transfer Restricted Securities for offer and sale under the securities or Blue
Sky laws of such jurisdictions within the United States as any Holder or
underwriter reasonably requests in writing; keep each such registration or
qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective and do any and all other
acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by the applicable
Registration Statement; provided, however, that the Company shall not be
-------- -------
required to qualify generally to do business in any jurisdiction where it is not
then so qualified or to take any action that would subject it to general service
of process in any such jurisdiction where it is not then so subject or subject
the Company to any tax in any such jurisdiction where it is not then so subject;
(i) In connection with any sale or transfer of Transfer Restricted
Securities that will result in such securities no longer being Transfer
Restricted Securities, cooperate with the Holders and the managing underwriters,
if any, to facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Securities to be sold, which certificates shall
not bear any restrictive
11
<PAGE>
legends and shall be in a form eligible for deposit with The Depository Trust
Com pany and to enable such Transfer Restricted Securities to be in such
denominations and registered in such names as the managing underwriters, if any,
or Holders may request at least two Business Days prior to any sale of Transfer
Restricted Securities;
(j) Use its reasonable best efforts to cause the offering of the Transfer
Restricted Securities covered by the Registration Statement to be registered
with or approved by such other governmental agencies or authorities within the
United States, except as may be required as a consequence of the nature of such
selling Holder's business, in which case the Company will cooperate in all
reasonable respects with the filing of such Registration Statement and the
granting of such approvals as may be necessary to enable the seller or sellers
thereof or the underwrit ers, if any, to consummate the disposition of such
Transfer Restricted Securities; provided, however, that the Company shall not be
-------- -------
required to register the Transfer Restricted Securities in any jurisdiction that
would subject it to general service of process in any such jurisdiction where it
is not then so subject or subject the Company to any tax in any such
jurisdiction where it is not then so subject or to require the Company to
qualify to do business in any jurisdiction where it is not then so qualified;
(k) Upon the occurrence of any event contemplated by Section 4(c)(vi)
hereof, as promptly as practicable, prepare a supplement or amendment,
including, if appropriate, a post-effective amendment, to each Registration
Statement or a supplement to the related Prospectus or any document incorporated
or deemed to be incorporated therein by reference, and file any other required
document so that, as thereafter delivered, such Prospectus will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(l) Prior to the effective date of the first Registration Statement
relating to the Transfer Restricted Securities, to provide a CUSIP number for
the Transfer Restricted Securities;
(m) Enter into such agreements (including an underwriting agreement in
form, scope and substance as is customary in underwritten offerings) and take
all such other reasonable actions in connection therewith (including those
reasonably requested by the managing underwriters, if any, or the Holders of a
majority in aggregate principal amount of the Transfer Restricted Securities
12
<PAGE>
being sold) in order to expedite or facilitate the disposition of such Transfer
Restricted Securities, and in such connection, whether or not an underwriting
agreement is entered into and whether or not the registration is an underwritten
registration, (i) make such representations and warranties to the Holders of
such Transfer Restricted Securities and the underwriters, if any, with respect
to the business of the Company and its subsidiaries (including with respect to
businesses or assets acquired or to be acquired by any of them), and the
Registration Statement, Prospectus and documents, if any, incorporated or deemed
to be incorporated by reference therein, in each case, in form, substance and
scope as are customarily made by issuers to underwriters in underwritten
offerings, and confirm the same if and when requested; (ii) obtain opinions of
counsel to the Company and updates thereof (which counsel and opinions (in form,
scope and substance) shall be reasonably satisfactory to the managing
underwriters, if any, and Special Counsel to the Holders of the Transfer
Restricted Securities being sold), addressed to each selling Holder of Transfer
Restricted Securities and each of the underwriters, if any, covering the matters
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by such Special Counsel and
underwriters; (iii) use its best efforts to obtain customary "cold comfort"
letters and updates thereof from the independent certified public accountants of
the Company (and, if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any business acquired by the
Company for which financial statements and financial data is, or is required to
be, included in the Registration Statement), addressed (where reasonably
possible) to each selling Holder of Transfer Restricted Securities and each of
the underwriters, if any, such letters to be in customary form and covering
matters of the type customarily covered in "cold comfort" letters in connection
with underwritten offerings; (iv) if an underwriting agreement is entered into,
the same shall contain indemnification provisions and procedures no less
favorable to the selling Holders of Transfer Restricted Securities and the
underwriters, if any, than those set forth in Section 6 hereof (or such other
provisions and procedures acceptable to Holders of a majority in aggregate
principal amount of the Transfer Restricted Securities covered by such
Registration Statement and the managing underwriters); and (v) deliver such
documents and certificates as may be reasonably requested by the Holders of a
majority in aggregate principal amount of the Transfer Restricted Securities
being sold, their Special Counsel and the managing underwriters, if any, to
evidence the continued validity of the representations and warranties made
pursuant to clause (i) of this Section 4(m) and to evidence compliance with any
customary conditions contained in the underwriting agreement or other agreement
entered into by the Company;
13
<PAGE>
(n) Make available for inspection by a representative of the Holders of
Transfer Restricted Securities being sold, any underwriter participating in any
such disposition of Transfer Restricted Securities, if any, and any attorney,
consultant or accountant retained by such selling Holders or underwriter, at the
offices where normally kept, during reasonable business hours, all financial and
other records, pertinent corporate documents and properties of the Company and
its subsidiaries as they may reasonably request (including with respect to
business and assets acquired or to be acquired to the extent that such
information is available to the Company), and cause the officers, directors,
agents and employees of the Company and its subsidiaries (including with respect
to business and assets acquired or to be acquired to the extent that such
information is available to the Company) to supply all information in each case
reasonably requested by any such representative, underwriter, attorney,
consultant or accountant in connection with such Registration Statement,
provided, however, that such persons shall first agree in writing with the
- -------- -------
Company that any information that is reasonably and in good faith designated by
the Company in writing as confidential at the time of delivery of such
information shall be kept confidential by such persons, unless (i) disclosure of
such information is required by court or administrative order or is necessary to
respond to inquiries of regulatory authorities, (ii) disclosure of such
information is required by law (including any disclosure requirements pursuant
to Federal securities laws in connection with the filing of any Registration
Statement or the use of any prospectus referred to in this Agreement), (iii)
such information becomes generally available to the public other than as a
result of a disclosure or failure to safeguard by any such person or (iv) such
information becomes available to any such person from a source other than the
Company and such source is not bound by a confidentiality agreement;
(o) Provide an indenture trustee for the Transfer Restricted Securities and
cause the Indenture to be qualified under the TIA not later than the effective
date of the first Registration Statement relating to the Transfer Restricted
Securities; and in connection therewith, cooperate with the trustee under the
Inden ture and the holders of the Transfer Restricted Securities to effect such
changes to the Indenture as may be required for such Indenture to be so
qualified in accordance with the terms of the TIA; and execute, and use its
reasonable best efforts to cause such trustee to execute, all customary
documents as may be required to effect such changes, and all other forms and
documents required to be filed with the SEC to enable the Indenture to be so
qualified in a timely manner;
(p) Comply with applicable rules and regulations of the SEC and make
generally available to its security holders earning statements satisfying
14
<PAGE>
the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder
(or any similar rule promulgated under the Securities Act), no later than 45
days after the end of any 12-month period (or 90 days after the end of any 12-
month period if such period is a fiscal year) (i) commencing at the end of any
fiscal quarter in which Transfer Restricted Securities are sold to underwriters
in a firm commitment or reasonable efforts underwritten offering and (ii) if not
sold to underwriters in such an offering, commencing on the first day of the
first fiscal quarter after the effective date of a Registration Statement, which
statement shall cover said period, consistent with the requirements of Rule 158;
and
(q) (i) list all Common Stock covered by such Registration Statement on
any securities exchange on which the Common Stock is then listed or (ii)
authorize for quotation on the National Association of Securities Dealers
Automated Quotation System ("NASDAQ") or the National Market System of NASDAQ
all Common Stock covered by such Registration Statement if the Common Stock is
then so authorized for quotation.
The Company may require each seller of Transfer Restricted Securities as to
which any registration is being effected to furnish to the Company such
information regarding the distribution of such Transfer Restricted Securities as
is required by law to be disclosed in the applicable Registration Statement and
the Company may exclude from such registration the Transfer Restricted
Securities of any seller who unreasonably fails to furnish such information
within a reasonable time after receiving such request.
If any such Registration Statement refers to any Holder by name or
otherwise as the holder of any securities of the Company, then such Holder shall
have the right to require (i) the insertion therein of language, in form and
substance reasonably satisfactory to such Holder, to the effect that the holding
by such Holder of such securities is not to be construed as a recommendation by
such Holder of the investment quality of the Company's securities covered
thereby and that such holding does not imply that such Holder will assist in
meeting any future financial require ments of the Company, or (ii) in the event
that such reference to such Holder by name or otherwise is not required by the
Securities Act or any similar Federal statute then in force, the deletion of the
reference to such Holder in any amendment or supplement to the Registration
Statement filed or prepared subsequent to the time that such reference ceases to
be required.
15
<PAGE>
Each Holder of Transfer Restricted Securities agrees by acquisition of such
Transfer Restricted Securities that, upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 4(c)(ii),
4(c)(iii), 4(c)(v) or 4(c)(vi) hereof, such Holder will forthwith discontinue
disposition of such Transfer Restricted Securities covered by such Registration
Statement or Prospectus until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 4(k) hereof, or until
it is advised in writing (the "Advice") by the Company that the use of the
applicable Prospectus may be resumed, and, in either case, has received copies
of any additional or supplemental filings that are incorpo rated or deemed to be
incorporated by reference in such Prospectus. If the Company shall give any
such notice, the Effectiveness Period shall be extended by the number of days
during such period from and including the date of the giving of such notice to
and including the date when each seller of Transfer Restricted Securities
covered by such Registration Statement shall have received (x) the copies of the
supplemented or amended Prospectus contemplated by Section 4(k) hereof or (y)
the Advice, and, in either case, has received copies of any additional or
supplemental filings that are incorporated or deemed to be incorporated by
reference in such Prospectus.
5. Registration Expenses
---------------------
(a) All fees and expenses incident to the performance of or compliance with
this Agreement by the Company shall be borne by it whether or not any
Registration Statement is filed or becomes effective and whether or not any
securities are issued or sold pursuant to any Registration Statement. The fees
and expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without limitation,
fees and expenses (A) with respect to filings required to be made with the
National Association of Securities Dealers, Inc. and (B) in compliance with
securities or Blue Sky laws (including, without limitation and in addition to
that provided for in (b) below, fees and disbursements of counsel for the
underwriters or Special Counsel for the Holders in connection with Blue Sky
qualifications of the Transfer Restricted Securities and determination of the
eligibility of the Transfer Restricted Securities for investment under the laws
of such jurisdictions as the managing underwriters, if any, or Holders of a
majority in aggregate principal amount of Transfer Restricted Securities may
designate)), (ii) printing expenses (including, without limitation, expenses of
printing certificates for Transfer Restricted Securities in a form eligible for
deposit with The Depository Trust Company and of printing Prospectuses if the
printing of Prospectuses is requested
16
<PAGE>
by the managing underwriters, if any, or by the Holders of a majority in
principal amount of the Transfer Restricted Securities included in or tendered
for in connection with any Registration Statement), (iii) messenger, tele phone
and delivery expenses, (iv) fees and disbursements of counsel for the Company
and Special Counsel for the Holders (plus any local counsel, deemed appropriate
by the Holders of a majority in aggregate principal amount of the Transfer
Restricted Securities), in accordance with the provisions of Section 5(b)
hereof, (v) fees and disbursements of all independent certified public
accountants referred to in Section 4(m)(iii) (including, without limitation, the
expenses of any special audit and "cold comfort" letters required by or incident
to such performance), (vi) Securities Act liability insurance, if the Company so
desires such insurance, and (vii) fees and expenses of all other persons
retained by the Company. In addition, the Company shall pay its internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense of
any annual audit, and the fees and expenses incurred in connection with the
listing of the securities to be registered on any securities exchange.
Notwithstanding the foregoing or anything in this Agreement to the contrary,
each Holder shall pay all underwriting discounts and commissions of any
underwriters with respect to any Transfer Restricted Securities sold by it.
(b) In connection with any registration hereunder, the Company shall
reimburse the Holders of the Transfer Restricted Securities being registered or
tendered for in such registration for the reasonable fees and disbursements of
not more than one firm of attorneys representing the selling Holders (in
addition to any local counsel), which firm shall be chosen by the Holders of a
majority in aggregate principal amount of the Transfer Restricted Securities.
6. Indemnification
---------------
(a) The Company agrees to indemnify and hold harmless (i) each of the
Purchasers, (ii) each Holder of Transfer Restricted Securities, (iii) each
person, if any, who controls (within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act) any of the foregoing (any of the persons
referred to in this clause (iii) being hereinafter referred to as a "controlling
person"), and (iv) the respective officers, directors, partners, employees,
representatives and agents of the Purchasers, each Holder of Transfer Restricted
Securities, or any controlling person (any person referred to in clause (i),
(ii), (iii) or (iv) may hereinafter be referred to as an "Indemnified Person"),
------------------
from and against any and all losses, claims, damages, liabilities and judgments
17
<PAGE>
caused by any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement, Prospectus or form of Prospectus or in
any amendment or supplement thereto or in any preliminary Prospectus, or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein (in the case of
any Prospectus or form of Prospectus or supplement thereto, in light of the
circumstances under which they were made) not misleading, except insofar as such
losses, claims, damages, liabilities or judgments are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon
information relating to any Indemnified Person furnished in writing to the
Company by or on behalf of such Indemnified Person expressly for use therein;
provided that the foregoing indemnity with respect to any preliminary Prospectus
- --------
shall not inure to the benefit of any Indemnified Person from whom the person
asserting such losses, claims, damages, liabilities and judgments purchased
securities if such untrue state ment or omission or alleged untrue statement or
omission made in such preliminary Prospectus is eliminated or remedied in the
Prospectus and a copy of the Prospectus shall not have been furnished to such
person in a timely manner due to the wrongful action or wrongful inaction of
such Indemnified Person.
(b) In case any action shall be brought against any Indemnified Person,
based upon any Registration Statement or any such Prospectus or any amendment or
supplement thereto and with respect to which indemnity may be sought against the
Company, such Indemnified Person shall promptly notify the Company in writing
and the Company shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to such Indemnified Person and payment of all
fees and expenses. Any Indemnified Person shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such
Indemnified Person, unless (i) the employment of such counsel shall have been
specifically authorized in writing by the Company, (ii) the Company shall have
failed to assume the defense and employ counsel or (iii) the named parties to
any such action (including any impleaded parties) include both such Indemnified
Person and the Company and such Indemnified Person shall have been advised by
counsel that there may be one or more legal defenses available to it which are
different from or additional to those available to the Com pany (in which case
the Company shall not have the right to assume the defense of such action on
behalf of such Indemnified Person, it being understood, however, that the
Company shall not, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general
18
<PAGE>
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) for
all such Indemnified Persons, which firm shall be designated in writing by such
Indemnified Persons, and that all such fees and expenses shall be reimbursed as
they are incurred). The Company shall not be liable for any settlement of any
such action effected without its written consent but if settled with the written
consent of the Company, the Company agrees to indemnify and hold harmless any
Indemnified Person from and against any loss or liability by reason of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
(c) In connection with any Registration Statement in which a Holder of
Transfer Restricted Securities is participating, such Holder of Transfer
Restricted Securities agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers and any person controlling the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, to the same extent as the foregoing indemnity from the Company to
each Indemnified Person but only with reference to information relating to such
Indemnified Person furnished in writing by or on behalf of such Indemnified
Person expressly for use in such Registra tion Statement. In case any action
shall be brought against the Company, any of its directors, any such officer or
any person controlling the Company based on such Registration Statement and in
respect of which indemnity may be sought against any Indemnified Person, the
Indemnified Person shall have the rights and duties given to the Company (except
that if the Company shall have assumed the defense thereof, such Indemnified
Person shall not be required to do so, but may employ separate counsel therein
and participate in defense thereof but the fees and expenses of such counsel
shall be at the expense of such Indemnified Person), and the Company, its
directors, any such officers and any person controlling the Company shall have
the rights and duties given to the Indemnified Person, by Section 6(b) hereof.
(d) If the indemnification provided for in this Section 6 is unavailable to
an indemnified party in respect of any losses, claims, damages, liabilities or
judgments referred to therein, then each indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
19
<PAGE>
liabilities and judgments (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and each
Indemnified Person on the other hand from the offering of the Notes 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 and
each such Indemnified Person in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or judgments, as
well as any other relevant equitable considerations. The relative fault of the
Company and each such Indemnified Person shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission to state a material fact relates to information supplied by
the Company or such Indemnified Person and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Purchasers agree that it would not be just and
equitable if contribution pursuant to this Section 6(d) were determined by pro
---
rata allocation (even if the Indemnified Person were treated as one entity for
- ----
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, 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 Section 6, no Indemnified Person shall be
required to contribute any amount in excess of the amount by which the total net
profit received by it in connection with the sale of the Notes pursuant to this
Agreement exceeds the amount of any damages which such Indemnified Person has
otherwise been required to pay by reason of such 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 Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Indemnified Persons' obligations to contribute
pursuant to this Section 6(d) are several in proportion to the respective amount
of Notes included in any such Registration Statement by each Indemnified Person
and not joint.
20
<PAGE>
7. Rules 144 and 144A
------------------
The Company shall use its best efforts to file the reports required to be
filed by it under the Securities Act and the Exchange Act in a timely manner
and, if at any time it is not required to file such reports but in the past had
been required to or did file such reports, it will, upon the request of any
holder of Transfer Restricted Securities, make available other information as
required by, and so long as necessary to permit, sales of its Transfer
Restricted Securities pursuant to Rule 144 and Rule 144A. Notwithstanding the
foregoing, nothing in this Section 7 shall be deemed to require the Company to
register any of its securities pursuant to the Exchange Act.
8. Underwritten Registrations
--------------------------
(a) If any of the Transfer Restricted Securities covered by any Shelf
Registration are to be sold in an underwritten offering, the investment banker
or investment bankers and manager or managers that will administer the offering
will be selected by the Holders of a majority in aggregate principal amount of
such Transfer Restricted Securities included in such offering, subject to the
consent of the Company (which will not be unreasonably withheld or delayed).
No person may participate in any underwritten registration hereunder unless
such person (i) agrees to sell such person's Transfer Restricted Securities on
the basis reasonably provided in any underwriting arrangements approved by the
persons entitled hereunder to approve such arrangements and (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting
arrangements.
(b) Each Holder of Transfer Restricted Securities agrees, if requested
(pursuant to a timely written notice) by the managing underwriters in an
underwritten offering or placement agent in a private offering of the Company's
securities, not to effect any private sale or distribution (including a sale
pursuant to Rule 144(k) and Rule 144A, but excluding non-public sales to any of
its affiliates, officers, directors, employees and controlling persons of any of
the Notes, in the case of an offering of the Company's debt securities, or the
Common Stock, in the case of an offering of the Company's equity securities),
during the period beginning 10 days prior to, and ending 90 days after, the
closing date of the underwritten offering.
21
<PAGE>
The foregoing provisions shall not apply to any Holder of Transfer
Restricted Securities if such Holder is prevented by applicable statute or
regulation from entering into any such agreement.
9. Miscellaneous
-------------
(a) Remedies. In the event of a breach by the Company, or by a holder of
--------
Transfer Restricted Securities, of any of their obligations under this
Agreement, each holder of Transfer Restricted Securities or the Company, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement. The Company and each holder of Transfer Restricted
Securities agree that monetary damages would not be adequate compensation for
any loss incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company shall not enter into any
--------------------------
agreement with respect to its securities that is inconsistent with the rights
granted to the holders of Transfer Restricted Securities in this Agreement or
other wise conflicts with the provisions hereof. Except for the Registration
Rights Agreement dated as of October 20, 1993 relating to the 5% Convertible
Subordinated Debentures Due 2000 of the Company, the Company is not currently a
party to any agreement granting any registration rights with respect to any of
its debt securities to any person. Without limiting the generality of the
foregoing, without the written consent of the Holders of a majority in aggregate
principal amount of the then outstanding Transfer Restricted Securities, the
Company shall not grant to any person the right to request it to register any of
its debt securities under the Securities Act unless the rights so granted are
subject in all respects to the prior rights of the holders of Transfer
Restricted Securities set forth herein, and are not otherwise in conflict or
inconsistent with the provisions of this Agreement.
(c) No Piggyback on Registrations. The Company shall not grant to any of
-----------------------------
its security holders (other than the Holders of Transfer Restricted Securities
in such capacity) the right to include any of its securities in any Shelf
Registration other than Transfer Restricted Securities.
22
<PAGE>
(d) Amendments and Waivers. The provisions of this Agreement, including
----------------------
the provisions of this sentence, may not be amended, modified or supple mented,
and waivers or consents to departures from the provisions hereof may not be
given, without the written consent of the Holders of a majority of the then
outstand ing Transfer Restricted Securities on a fully converted basis;
provided, however, that, for the purposes of this Agreement, Transfer Restricted
- -------- -------
Securities that are owned, directly or indirectly, by either the Company or an
Affiliate of the Company are not deemed outstanding. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of Holders of Transfer
Restricted Securities whose securities are being sold pursuant to a Registration
Statement and that does not directly or indirectly affect the rights of other
Holders of Transfer Restricted Securities may be given by Holders of a majority
of the Transfer Restricted Securities (on a fully converted basis) being sold by
such Holders pursuant to such Registration Statement; provided, however, that
-------- -------
the provisions of this sentence may not be amended, modified, or supplemented
except in accordance with the provisions of the immediately preceding sentence.
(e) Notices. All notices and other communications provided for herein
-------
shall be made in writing by hand-delivery, next-day air courier, certified
first-class mail, return receipt requested, telex or telecopy:
(i) if to the Company, as provided in the Purchase Agreement,
(ii) if to the Purchasers, as provided in the Purchase Agreement, or
(iii) if to any other person who is then the registered Holder of any
Transfer Restricted Securities, to the address of such Holder as
it appears in the Note or Common Stock register of the Company.
Except as otherwise provided in this Agreement, all such communications
shall be deemed to have been duly given: when delivered by hand, if personally
delivered; one Business Day after being timely delivered to a next-day air
courier; five Business Days after being deposited in the mail, postage prepaid,
if mailed; when answered back, if telexed; and when receipt is acknowledged by
the recipient's telecopier machine, if telecopied.
23
<PAGE>
(f) Successors and Assigns. This Agreement shall inure to the benefit of
----------------------
and be binding upon the successors and permitted assigns of each of the parties
and shall inure to the benefit of each Holder of Transfer Restricted Securities.
The Company may not assign its rights or obligations hereunder without the prior
written consent of each Holder of Transfer Restricted Securities.
Notwithstanding the foregoing, no transferee shall have any of the rights
granted under this Agreement until such transferee shall acknowledge its rights
and obligations hereunder by a signed written statement of such transferee's
acceptance of such rights and obligations.
(g) Counterparts. This Agreement may be executed in any number of
------------
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and, all of which taken
together shall constitute one and the same Agreement.
(h) Governing Law; Submission to Jurisdiction.
-----------------------------------------
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN
THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. THE
COMPANY HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. THE COMPANY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICA BLE LAW,
ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF
ANY SUCH SUIT, ACTION OR PRO CEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM
THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.
(i) Severability. The remedies provided herein are cumulative and not
------------
exclusive of any remedies provided by law. If any term, provision,
24
<PAGE>
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or invalidated,
and the parties hereto shall use their reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unen forceable.
(j) Headings. The headings in this Agreement are for convenience of
--------
reference only and shall not limit or otherwise affect the meaning hereof. All
references made in this Agreement to "Section" and "paragraph" refer to such
Section or paragraph of this Agreement, unless expressly stated otherwise.
(k) Attorneys' Fees. In any action or proceeding brought to enforce any
---------------
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the prevailing party, as determined by the court, shall be
entitled to recover its reasonable attorneys' fees in addition to any other
available remedy.
25
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as of the date first written above.
UNITED STATES FILTER CORPORATION
By: /s/ KEVIN L. SPENCE
-------------------
Name: Kevin L. Spence
Title: Vice President and Chief
Financial Officer
The foregoing Registration Rights
Agreement is hereby confirmed
and accepted as of the date
first above written.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
PAINEWEBBER INCORPORATED
By: Donaldson, Lufkin & Jenrette
Securities Corporation
By: /s/ JAMES T. SINGTON
--------------------
Name: Jim Sington
Title: Managing Director
<PAGE>
Exhibit 5.1
October 6, 1995
UNIF.3
Board of Directors
United States Filter Corporation
73-710 Fred Waring Drive, Ste. 222
Palm Desert, California 92260
Re: Registration Statement on Form S-3
----------------------------------
Dear Board of Directors:
I am the general Counsel of United States Filter Corporation (the
"Company"). I have acted as counsel for the Company in connection with the
preparation and filing with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, of a Registration Statement on Form S-3 (the
"Registration Statement") relating to the possible sale from time to time of
$140,000,000 in aggregate principal amount of the Company's 6% Convertible
Subordinated Notes due 2005 (the "Notes") by the holders thereof and the shares
of the Company's Common Stock, $.01 par value per share, which may be issued
upon conversion of the Debentures (the "Conversion Shares").
As counsel to the Company, I am familiar with the proceedings heretofore
taken in connection with the sale by the Company of the Notes, and the
additional proceedings executed in connection with the Registration Statement
and the possible sale from time to time of the Notes and the Conversion Shares
in the manner contemplated by the Registration Statement. In addition, I have
examined such books and records of the Company as in my judgment was necessary
or appropriate to enable me to render the opinions expressed below.
Based upon the foregoing, it is my opinion that the Notes have been legally
issued, the Notes are fully paid and are non assessable and that the Notes are
binding obligations of the Company in accordance with their terms subject to
those limitations arising pursuant to applicable bankruptcy
<PAGE>
and similar laws and equitable principles and general principles of public
policy and judicial discretion (together the "Exceptions") and that, when, in
the manner contemplated in the Prospectus made part of the Registration
Statement, the Notes are sold and/or the Notes are converted into the Conversion
Shares and the Conversion Shares are sold, the Notes and Conversion Shares, as
applicable, will be legally and validly issued, fully paid and nonassessable and
the Notes will continue to be binding obligations of the Company subject to the
Exceptions.
I consent to the use of this opinion as an exhibit to the Registration
Statement and to the reference to me in the Prospectus of the Company made a
part thereof.
Very truly yours,
/s/ Damian C. Georgino, Esq.
Damian C. Georgino, Esq.
<PAGE>
EXHIBIT 12.1
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Dollars in thousands)
<TABLE>
<CAPTION>
Three Months
Ended
Fiscal Year Ended March 31, June 30,
----------------------------------------------------------- ---------------------
1991 1992 1993 1994 1995 1994 1995
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Income before income taxes $ (1,848) (6,290) 648 (4,874) 14,585 1,978 6,248
Interest expense 763 1,016 1,327 2,077 5,384 900 2,435
Portion of rental expense deemed
to represent interest 315 462 628 695 855 175 213
-------- -------- -------- -------- -------- -------- --------
Earnings (loss) before fixed charges $ (770) (4,812) 2,603 (2,102) 20,824 3,053 8,896
======== ======== ======== ======== ======== ======== ========
Interest expense $ 763 1,016 1,327 2,077 5,384 900 2,435
Portion of rental expense deemed
to represent interest 315 462 628 695 855 175 213
-------- -------- -------- -------- -------- -------- --------
Fixed charges $ 1,078 1,478 1,955 2,772 6,239 1,075 2,648
======== ======== ======== ======== ======== ======== ========
Ratio of earnings to fixed charges n/a n/a 1.3x n/a 3.3x 2.8x 3.4x
======== ======== ======== ======== ======== ======== ========
Deficiency of earnings to fixed charges $ (1,848) (6,290) n/a (4,874) n/a n/a n/a
======== ======== ======== ======== ======== ======== ========
</TABLE>
<PAGE>
Exhibit 23.2
1 of 3
Accountants' Consent
To the Board of Directors and Shareholders
United States Filter Corporation:
We consent to incorporation by reference in the Registration Statement on Form
S-3 of United States Filter Corporation of our report dated June 1, 1995,
relating to the consolidated balance sheets of United States Filter Corporation
as of March 31, 1994 and 1995, and the related consolidated statements of
operations, shareholders' equity, and cash flows for each of the years in the
three-year period ended March 31, 1995 and to the reference of our firm under
the heading "Independent Certified Public Accountants" in the prospectus.
KPMG PEAT MARWICK LLP
Orange County, California
October 6, 1995
<PAGE>
Exhibit 23.2
2 of 3
Accountants' Consent
To the Board of Directors and Shareholders
United States Filter Corporation:
We consent to incorporation by reference in the Registration Statement on Form
S-3 of United States Filter Corporation of our report dated August 11, 1995,
relating to the consolidated balance sheet of Polymetrics, Inc. and subsidiaries
as of December 31, 1994, and the related consolidated statements of operations,
stockholder's equity and cash flows for the year then ended and to the reference
of our firm under the heading "Independent Certified Public Accountants" in the
prospectus.
KPMG PEAT MARWICK LLP
San Francisco, California
October 6, 1995
<PAGE>
Exhibit 23.2
3 of 3
Accountants' Consent
To the Board of Directors and Shareholders
United States Filter Corporation:
We consent to incorporation by reference in the Registration Statement on Form
S-3 of United States Filter Corporation of our report dated September 29, 1995,
relating to the statements of assets acquired and liabilities assumed of
Arrowhead Industrial Water Inc. as of December 31, 1994 and 1993 and the related
statements of revenues and expenses for the years then ended and of our report
dated June 29, 1995 relating to the combined balance sheet of Continental
H\2\O Services, Inc. and Evansville Water Corporation d/b/a Interlake Water
Systems as of December 31, 1994 and the related combined statements of
operations, stockholders' equity and cash flows for the year then ended and to
the reference of our firm under the heading "Independent Certified Public
Accountants" in the prospectus.
KPMG PEAT MARWICK LLP
Chicago, Illinois
October 6, 1995
<PAGE>
EXHBIT 25.1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE
TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an Application to Determine Eligibility
of a Trustee Pursuant to Section 305(b)(2)____
STATE STREET BANK AND TRUST COMPANY
(Exact name of trustee as specified in its charter)
Massachusetts 04-1867445
(Jurisdiction of incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification No.)
225 Franklin Street, Boston, Massachusetts 02110
(Address of principal executive offices) (Zip code)
John R. Towers, Esq. Senior Vice President and Corporate Secretary
225 Franklin Street, Boston, Massachusetts 02110
(617) 654-3253
(Name, address and telephone number of agent for service)
-------------------------
UNITED STATES FILTER CORPORATION
(Exact name of obligor as specified in its charter)
Delaware 33-0266015
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
73-710 Fred Waring Drive
Suite 222
Palm Desert, California 92260
(Address of principal executive offices) (Zip code)
-------------------------
6% Convertible Subordinated Notes due 2005
(Title of indenture securities)
<PAGE>
GENERAL
ITEM 1. GENERAL INFORMATION.
FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH IT
IS SUBJECT.
Department of Banking and Insurance of The Commonwealth of
Massachusetts, 100 Cambridge Street, Boston, Massachusetts.
Board of Governors of the Federal Reserve System, Washington, D.C.,
Federal Deposit Insurance Corporation, Washington, D.C.
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
The obligor is not an affiliate of the trustee or of its parent,
State Street Boston Corporation.
(See Note on page 6.)
ITEM 3. VOTING SECURITIES OF THE TRUSTEE.
FURNISH THE FOLLOWING INFORMATION AS TO EACH CLASS OF VOTING SECURITIES OF
THE TRUSTEE:
As of:
Col. A Col. B
Title of Class Amount outstanding
Not applicable.
ITEM 4. TRUSTEESHIPS UNDER OTHER INDENTURES.
IF THE TRUSTEE IS A TRUSTEE UNDER ANOTHER INDENTURE UNDER WHICH ANY OTHER
SECURITIES, OR CERTIFICATES OF INTEREST OR PARTICIPATION IN ANY OTHER
SECURITIES, OF THE OBLIGOR ARE OUTSTANDING, FURNISH THE FOLLOWING INFORMATION:
(A) TITLE OF THE SECURITIES OUTSTANDING UNDER EACH SUCH OTHER INDENTURE.
Not applicable.
(B) A BRIEF STATEMENT OF THE FACTS RELIED UPON AS A BASIS FOR THE CLAIM
THAT NO CONFLICTING INTEREST WITHIN THE MEANING OF SECTION 310(B)(1) OF THE ACT
ARISES AS A RESULT OF THE TRUSTEESHIP UNDER ANY SUCH OTHER INDENTURE, INCLUDING
A STATEMENT AS TO HOW THE INDENTURE SECURITIES WILL RANK AS COMPARED WITH THE
SECURITIES ISSUED UNDER SUCH OTHER INDENTURE.
Not applicable.
1
<PAGE>
ITEM 5. INTERLOCKING DIRECTORATES AND SIMILAR RELATIONSHIPS WITH THE OBLIGOR OR
UNDERWRITERS.
IF THE TRUSTEE OR ANY OF THE DIRECTORS OR EXECUTIVE OFFICERS OF THE TRUSTEE
IS A DIRECTOR, OFFICER, PARTNER, EMPLOYEE, APPOINTEE OR REPRESENTATIVE OF THE
OBLIGOR OR OF ANY UNDERWRITER FOR THE OBLIGOR, IDENTIFY EACH SUCH PERSON HAVING
ANY SUCH CONNECTION AND STATE THE NATURE OF EACH SUCH CONNECTION.
Not applicable.
ITEM 6. VOTING SECURITIES OF THE TRUSTEE OWNED BY THE OBLIGOR OR ITS OFFICIALS.
FURNISH THE FOLLOWING INFORMATION AS TO THE VOTING SECURITIES OF THE TRUSTEE
OWNED BENEFICIALLY BY THE OBLIGOR AND EACH DIRECTOR, PARTNER AND EXECUTIVE
OFFICER OF THE OBLIGOR:
As of:
Col. A Col. B Col. C Col. D
Name of Title of Amount owned Percentage of
owner class beneficially voting securities
represented by
amount given in
Col. C
Not applicable.
ITEM 7. VOTING SECURITIES OF THE TRUSTEE OWNED BY UNDERWRITERS OR THEIR
OFFICIALS.
FURNISH THE FOLLOWING INFORMATION AS TO THE VOTING SECURITIES OF THE TRUSTEE
OWNED BENEFICIALLY BY EACH UNDERWRITER FOR THE OBLIGOR AND EACH DIRECTOR,
PARTNER AND EXECUTIVE OFFICER OF EACH SUCH UNDERWRITER:
As of:
Col. A Col. B Col. C Col. D
Name of Title of Amount owned Percentage of
owner class beneficially voting securities
represented by
amount given in
Col. C
Not Applicable.
ITEM 8. SECURITIES OF THE OBLIGOR OWNED OR HELD BY THE TRUSTEE.
FURNISH THE FOLLOWING INFORMATION AS TO SECURITIES OF THE OBLIGOR OWNED
BENEFICIALLY OR HELD AS COLLATERAL SECURITY FOR OBLIGATIONS IN DEFAULT BY THE
TRUSTEE:
2
<PAGE>
As of:
Col. A Col. B Col. C Col. D
Title of Whether Amount owned Percent of
class the securities beneficially class repre-
are voting or or held as sented by
non-voting collateral security amount given
securities for obligations in Col. C
in default
Not applicable.
ITEM 9. SECURITIES OF UNDERWRITERS OWNED OR HELD BY THE TRUSTEE.
IF THE TRUSTEE OWNS BENEFICIALLY OR HOLDS AS COLLATERAL SECURITY FOR
OBLIGATIONS IN DEFAULT ANY SECURITIES OF AN UNDERWRITER FOR THE OBLIGOR, FURNISH
THE FOLLOWING INFORMATION AS TO EACH CLASS OF SECURITIES OF SUCH UNDERWRITER ANY
OF WHICH ARE SO OWNED OR HELD BY THE TRUSTEE:
As of:
Col. A Col. B Col. C Col. D
Title of Amount Amount owned Percent of
issuer outstanding beneficially class represented
and title or held as by amount
of class collateral security given in Col. C
for obligations in
default by trustee
Not applicable.
ITEM 10. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF VOTING SECURITIES OF CERTAIN
AFFILIATES OR SECURITY HOLDERS OF THE OBLIGOR.
IF THE TRUSTEE OWNS BENEFICIALLY OR HOLDS AS COLLATERAL SECURITY FOR
OBLIGATIONS IN DEFAULT VOTING SECURITIES OF A PERSON WHO, TO THE KNOWLEDGE OF
THE TRUSTEE (1) OWNS 10 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR
OR (2) IS AN AFFILIATE, OTHER THAN A SUBSIDIARY, OF THE OBLIGOR, FURNISH THE
FOLLOWING INFORMATION AS TO THE VOTING SECURITIES OF SUCH PERSON:
As of:
Col. A Col. B Col. C Col. D
Title of Amount Amount owned Percent of
issuer outstanding beneficially class represented
and title or held as by amount
of class collateral security given in Col. C
for obligations in
default by trustee
Not applicable.
ITEM 11. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF ANY SECURITIES OF A PERSON
OWNING 50 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR.
IF THE TRUSTEE OWNS BENEFICIALLY OR HOLDS AS COLLATERAL SECURITY FOR
OBLIGATIONS IN DEFAULT ANY SECURITIES OF A PERSON WHO, TO THE KNOWLEDGE OF THE
TRUSTEE, OWNS 50 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR,
FURNISH THE FOLLOWING INFORMATION AS TO EACH CLASS OF SECURITIES OF SUCH PERSON
ANY OF WHICH ARE SO OWNED OR HELD BY THE TRUSTEE:
3
<PAGE>
As of:
Col. A Col. B Col. C Col. D
Title of Amount Amount owned Percent of
issuer outstanding beneficially class represented
and title or held as by amount
of class collateral security given in Col. C
for obligations in
default by trustee
Not applicable.
ITEM 12. INDEBTEDNESS OF THE OBLIGOR TO THE TRUSTEE.
EXCEPT AS NOTED IN THE INSTRUCTIONS, IF THE OBLIGOR IS INDEBTED TO THE
TRUSTEE, FURNISH THE FOLLOWING INFORMATION:
As of:
Col. A Col. B Col. C
Nature of Amount Date due
indebtedness outstanding
Not applicable.
ITEM 13. DEFAULTS BY THE OBLIGOR.
(A) STATE WHETHER THERE IS OR HAS BEEN A DEFAULT WITH RESPECT TO THE
SECURITIES UNDER THIS INDENTURE. EXPLAIN THE NATURE OF ANY SUCH DEFAULT.
Not applicable.
(B) IF THE TRUSTEE IS A TRUSTEE UNDER ANOTHER INDENTURE UNDER WHICH ANY
OTHER SECURITIES, OR CERTIFICATES OF INTEREST OR PARTICIPATION IN ANY OTHER
SECURITIES, OF THE OBLIGOR ARE OUTSTANDING, OR IS A TRUSTEE FOR MORE THAN ONE
OUTSTANDING SERIES OF SECURITIES UNDER THE INDENTURE, STATE WHETHER THERE HAS
BEEN A DEFAULT UNDER ANY SUCH INDENTURE OR SERIES, IDENTIFY THE INDENTURE OR
SERIES AFFECTED, AND EXPLAIN THE NATURE OF ANY SUCH DEFAULT.
To the best of the knowledge of the Trustee, there has not been a
default under any such indenture or series.
ITEM 14. AFFILIATIONS WITH THE UNDERWRITERS.
IF AN UNDERWRITER IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
Not applicable.
ITEM 15. FOREIGN TRUSTEE.
IDENTIFY THE ORDER OR RULE PURSUANT TO WHICH THE FOREIGN TRUSTEE IS
AUTHORIZED TO ACT AS SOLE TRUSTEE UNDER INDENTURES QUALIFIED OR TO BE QUALIFIED
UNDER THE ACT.
Not applicable.
4
<PAGE>
ITEM 16. LIST OF EXHIBITS.
LIST BELOW ALL EXHIBITS FILED AS A PART OF THIS STATEMENT OF ELIGIBILITY.
1. A COPY OF THE ARTICLES OF ASSOCIATION OF THE TRUSTEE AS NOW IN EFFECT.
A copy of the Articles of Association of the trustee, as now in effect,
is on file with the Securities and Exchange Commission as Exhibit 1 to
Amendment No. 1 to the Statement of Eligibility and Qualification of
Trustee (Form T-1) filed with Registration Statement of Morse Shoe,
Inc. (File No. 22-17940) and is incorporated herein by reference
thereto.
2. A COPY OF THE CERTIFICATE OF AUTHORITY OF THE TRUSTEE TO COMMENCE
BUSINESS, IF NOT CONTAINED IN THE ARTICLES OF ASSOCIATION.
A copy of a Statement from the Commissioner of Banks of Massachusetts
that no certificate of authority for the trustee to commence business
was necessary or issued is on file with the Securities and Exchange
Commission as Exhibit 2 to Amendment No. 1 to the Statement of
Eligibility and Qualification of Trustee (Form T-1) filed with
Registration Statement of Morse Shoe, Inc. (File No. 22-17940) and is
incorporated herein by reference thereto.
3. A COPY OF THE AUTHORIZATION OF THE TRUSTEE TO EXERCISE CORPORATE TRUST
POWERS, IF SUCH AUTHORIZATION IS NOT CONTAINED IN THE DOCUMENTS SPECIFIED IN
PARAGRAPH (1) OR (2) ABOVE.
A copy of the authorization of the trustee to exercise corporate trust
powers is on file with the Securities and Exchange Commission as
Exhibit 3 to Amendment No. 1 to the Statement of Eligibility and
Qualification of Trustee (Form T-1) filed with Registration Statement
of Morse Shoe, Inc. (File No. 22-17940) and is incorporated herein by
reference thereto.
4. A COPY OF THE EXISTING BY-LAWS OF THE TRUSTEE, OR INSTRUMENTS
CORRESPONDING THERETO.
A copy of the By-Laws of the trustee, as now in effect, is on file with
the Securities and Exchange Commission as Exhibit 4 to the Statement of
Eligibility and Qualification of Trustee (Form T-1) filed with
Registration Statement of Eastern Edison Company (File No. 33-37823)
and is incorporated herein by reference thereto.
5. A COPY OF EACH INDENTURE REFERRED TO IN ITEM 4, IF THE OBLIGOR IS IN
DEFAULT.
Not applicable.
6. THE CONSENTS OF THE UNITED STATES INSTITUTIONAL TRUSTEES REQUIRED BY
SECTION 321(B) OF THE ACT.
The consent of the trustee required by Section 321(b) of the Act is
annexed hereto as Exhibit 6 and made a part hereof.
7. A COPY OF THE LATEST REPORT OF CONDITION OF THE TRUSTEE PUBLISHED
PURSUANT TO LAW OR THE REQUIREMENTS OF ITS SUPERVISING OR EXAMINING AUTHORITY.
A copy of the latest report of condition of the trustee published
pursuant to law or the requirements of its supervising or examining
authority is annexed hereto as Exhibit 7 and made a part hereof.
5
<PAGE>
8. A COPY OF ANY ORDER PURSUANT TO WHICH THE FOREIGN TRUSTEE IS AUTHORIZED
TO ACT AS SOLE TRUSTEE UNDER INDENTURES QUALIFIED OR TO BE QUALIFIED UNDER THE
ACT.
Not applicable.
9. FOREIGN TRUSTEES ARE REQUIRED TO FURNISH A CONSENT TO SERVICE OF
PROCESS.
Not applicable.
NOTE
The answers to this statement insofar as such answers relate to persons who
are affiliates of the obligors are based upon information furnished to the
trustee by the obligors. While the trustee has no reason to doubt the accuracy
of any such information, it cannot accept any responsibility therefor.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
trustee, State Street Bank and Trust Company, a corporation organized and
existing under the laws of The Commonwealth of Massachusetts, has duly caused
this statement of eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of Boston and The Commonwealth of
Massachusetts, on the 5th day of October, 1995.
STATE STREET BANK AND TRUST COMPANY
By /s/ Michael J. Lapolla
------------------------------------------
Michael J. Lapolla
Vice President
6
<PAGE>
EXHIBIT 6
CONSENT OF TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust Indenture Act of
1939 in connection with the proposed issuance by United States Filter
Corporation of its 6% Convertible Subordinated Notes due 2005, we hereby consent
that reports of examination by Federal, State, Territorial or District
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon request therefor.
STATE STREET BANK AND TRUST COMPANY
By /s/ Michael J. Lapolla
------------------------------------------
Michael J. Lapolla
Vice President
Dated: October 5, 1995
7
<PAGE>
EXHIBIT 7
Consolidated Report of Condition of State Street Bank and Trust Company of
Boston, Massachusetts and foreign and domestic subsidiaries, a state banking
institution organized and operating under the banking laws of this commonwealth
and a member of the Federal Reserve System, at the close of business December
31, 1994, published in accordance with a call made by the Federal Reserve Bank
of this District pursuant to the provisions of the Federal Reserve Act and in
accordance with a call made by the Commissioner of Banks under General Laws,
Chapter 172, Section 22(a).
<TABLE>
<CAPTION>
THOUSANDS OF
DOLLARS
------------
<S> <C> <C>
ASSETS
- ------
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin................................ 942,661
Interest-bearing balances......................................................... 4,843,628
Securities............................................................................. 8,410,339
Federal funds sold and securities purchased under agreements
to resell in domestic offices of the bank and of its Edge
subsidiary........................................................................... 2,240,374
Loans and lease financing receivables:
Loans and leases, net of unearned income..................... 3,257,795
Allowance for loan and lease losses.......................... 58,184
Loans and leases, net of unearned income and
allowance............................................................................ 3,199,611
Assets held in trading accounts........................................................ 825,549
Premises and fixed assets.............................................................. 375,086
Other real estate owned................................................................ 4,359
Investments in unconsolidated subsidiaries............................................. 25,051
Customers' liability to this bank on acceptances outstanding........................... 55,358
Intangible Assets...................................................................... 34,862
Other Assets........................................................................... 653,750
----------
Total Assets........................................................................... 21,610,628
==========
LIABILITIES
Deposits:
In domestic offices............................................................... 5,946,262
Noninterest-bearing..................................... 4,175,167
Interest-bearing........................................ 1,771,095
In foreign offices and Edge subsidiary............................................ 8,147,182
Noninterest-bearing..................................... 44,817
Interest-bearing........................................ 8,102,365
Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of the
bank and of its Edge subsidiary...................................................... 4,912,704
Demand notes issued to the U.S. Treasury and Trading Liabilities....................... 423,324
Other borrowed money................................................................... 386,049
Bank's liability on acceptances executed and outstanding............................... 55,621
Other liabilities...................................................................... 530,536
----------
Total liabilities:..................................................................... 20,401,678
==========
EQUITY CAPITAL
Common Stock........................................................................... 28,043
Surplus................................................................................ 177,736
Undivided profits...................................................................... 1,003,171
----------
Total equity capital................................................................... 1,208,950
----------
Total liabilities and equity capital................................................... 21,610,628
==========
</TABLE>
I, Rex S. Schuette, Senior Vice President and Comptroller of the above named
bank do hereby declare that this Report of Condition has been prepared in
conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Rex S. Schuette
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
David A. Spina
Marshall N. Carter
Charles F. Kaye
8
