<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
December 8, 1998
CONTINENTAL AIRLINES, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-09781 74-2099724
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
1600 Smith Street, Houston, Texas 77002
(Address of principal executive offices) (Zip Code)
(713) 324-5000
(Registrant's telephone number, including area code)
<PAGE> 2
Item 7. Financial Statements and Exhibits.
(c) Exhibits
4.1 Underwriting Agreement dated December 8, 1998
4.2 Senior Indenture dated July 15, 1997
12.1 Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of Ernst & Young LLP
<PAGE> 3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
Continental Airlines, Inc. has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
CONTINENTAL AIRLINES, INC.
By /s/ LAWRENCE W. KELLNER
Lawrence W. Kellner
Executive Vice President and
Chief Financial Officer
December 10, 1998
<PAGE> 4
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
4.1 Underwriting Agreement dated December 8, 1998
4.2 Senior Indenture dated July 15, 1997
12.1 Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of Ernst & Young LLP
<PAGE> 1
EXHIBIT 4.1
================================================================================
CONTINENTAL AIRLINES, INC.,
AS ISSUER
8% Notes due December 15, 2005
UNDERWRITING AGREEMENT
Dated: December 8, 1998
================================================================================
<PAGE> 2
CONTINENTAL AIRLINES, INC.,
as ISSUER
8% Notes due December 15, 2005
UNDERWRITING AGREEMENT
December 8, 1998
Morgan Stanley & Co. Incorporated
Credit Suisse First Boston Corporation
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Dear Sirs:
Continental Airlines, Inc., a Delaware corporation (the
"Company"), proposes to issue and sell, subject the terms and conditions stated
herein, to Morgan Stanley & Co. Incorporated ("Morgan Stanley") and Credit
Suisse First Boston Corporation (the "Underwriters") $200,000,000 aggregate
principal amount of its 8% Senior Notes due 2005 (the "Notes") to be issued
pursuant to the provisions of an Indenture dated July 15, 1997 between the
Company and Bank One, N.A., as trustee (the "Trustee").
Capitalized terms used but not defined herein have the meanings
to be assigned to them in the Prospectus (as defined below) or the Indenture.
The Company understands that the Underwriters propose to make an
offering of the Notes on the terms, subject to the conditions and in the manner
to be set forth in the Prospectus and this Agreement, as soon as the
Underwriters deem advisable after this Agreement has been executed and
delivered.
The Company has filed with the Securities and Exchange Commission
(the "Commission") a shelf registration statement on Form S-3 (File No. 333-
29255) relating to Debt Securities (as defined therein), including the Notes
(such registration statement (including the respective exhibits thereto and the
respective documents filed by the Company with the Commission pursuant to the
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Commission thereunder (collectively, the "Exchange Act"), that are
incorporated by reference therein), as amended at the date hereof, being herein
referred to as
<PAGE> 3
the "Registration Statement"), and the offering thereof from time to time in
accordance with Rule 415 of the Securities Act of 1933, as amended, and the
rules and regulations of the Commission thereunder (collectively, the
"Securities Act"). The Registration Statement has been declared effective by
the Commission. A final prospectus supplement reflecting the terms of the
Notes, the terms of the offering thereof and other matters relating to the
Notes, as further specified in Section 4(d) hereof, will be prepared and filed
together with the base prospectus referred to below pursuant to Rule 424 under
the Securities Act (such prospectus supplement, in the form filed on or after
the date hereof pursuant to Rule 424, being herein referred to as the
"Prospectus Supplement"). The base prospectus included in the Registration
Statement at the effective date of the Registration Statement and relating to
all offerings of Debt Securities under the Registration Statement, as
supplemented by the Prospectus Supplement, and including the documents
incorporated by reference therein, is herein called the "Prospectus", except
that, if such base prospectus is amended or supplemented on or prior to the
date on which the Prospectus Supplement is first filed pursuant to Rule 424,
the term "Prospectus" shall refer to such base prospectus as so amended or
supplemented and as supplemented by the Prospectus Supplement. Any reference
herein to the terms "amendment" or "supplement" with respect to the Prospectus
shall be deemed to refer to and include any documents filed with the Commission
under the Exchange Act after the date the Prospectus is filed with the
Commission, or the date of such Prospectus Supplement, as the case may be, and
incorporated therein by reference pursuant to Item 12 of Form S-3 under the
Securities Act.
1. Representations and Warranties. (a) The Company
represents and warrants to, and agrees with each Underwriter that:
(i) The Company meets the requirements for use of Form S-3
under the Securities Act; the Registration Statement has become
effective; and on the original effective date of the Registration
Statement, the Registration Statement complied as to form in all
material respects with the requirements of the Securities Act. On the
effective date of the Registration Statement, the Registration Statement
did not include 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 on the date hereof and on the
Closing Date (as defined below), the Prospectus, as amended and
supplemented if the Company shall have furnished any amendment or
supplement thereto, does not and will not include an untrue statement of
a material fact and does not and will not omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding
sentence does not apply to statements in or omissions from the
Registration Statement or the Prospectus based upon written information
furnished to the Company by any Underwriter through Morgan Stanley and
relating to such Underwriter expressly for use therein ("Underwriter
Information") or to statements or omissions in that part of each
Registration Statement which shall constitute the Statement of
Eligibility of the Trustee under the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"), on Form T-1.
2
<PAGE> 4
(ii) The documents incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-3 under the Securities Act, at the time
they were or hereafter, during the period mentioned in paragraph 4(a)
below, are filed with the Commission, complied and will comply as to
form in all material respects with the requirements of the Exchange Act.
(iii) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware,
with corporate power and authority to own, lease and operate its
property and to conduct its business as described in the Prospectus; and
the Company is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions in which its ownership or lease
of property or the conduct of its business requires such qualification,
except where the failure to be so qualified would not have a material
adverse effect on the condition (financial or otherwise), business,
properties or results of operations of the Company and its consolidated
subsidiaries taken as a whole (a "Material Adverse Effect").
(iv) Each of Continental Micronesia, Inc., Air Micronesia Inc.
and Continental Express, Inc. (together, the "Subsidiaries") has been
duly incorporated and is an existing corporation in good standing under
the laws of the jurisdiction of its incorporation, with corporate power
and authority to own its properties and conduct its business as
described in the Prospectus; and each Subsidiary is duly qualified to do
business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct
of its business requires such qualification, except where the failure to
be so qualified would not have a Material Adverse Effect; all of the
issued and outstanding capital stock of each Subsidiary has been duly
authorized and validly issued and is fully paid and nonassessable; and,
except as described in the Prospectus and except for the capital stock
of Continental Micronesia, Inc. which is pledged to secure obligations
of the Company, each Subsidiary's capital stock owned by the Company,
directly or through subsidiaries, is owned free from liens, encumbrances
and defects.
(v) Except as described in the Prospectus, the Company is not
in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which it is
a party or by which it may be bound or to which any of its properties
may be subject, except for such defaults that would not have a Material
Adverse Effect. The consummation of the transactions contemplated
herein has been duly authorized by all necessary corporate action of the
Company and will not result in any breach of any of the terms,
conditions or provisions of, or constitute a default under, or result in
the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company pursuant to any indenture, loan
agreement, contract or other instrument to which the Company is a party
or by which the Company
3
<PAGE> 5
may be bound or to which any of the property or assets of the Company is
subject, which breach, default, lien, charge or encumbrance,
individually or in the aggregate, would have a Material Adverse Effect,
nor will any such execution, delivery or performance result in any
violation of the provisions of the charter or by-laws of the Company or
any material violation of any statute, any rule, regulation or order of
any governmental agency or body or any court having jurisdiction over
the Company.
(vi) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
for the valid authorization, execution and delivery by the Company of
this Agreement and for the consummation of the transactions contemplated
herein, except such as may be required under the Securities Act, the
Trust Indenture Act, the securities or "blue sky" or similar laws of the
various states and of foreign jurisdictions or rules and regulations of
the National Association of Securities Dealers, Inc.
(vii) This Agreement has been duly authorized, executed and
delivered by the Company.
(viii) The consolidated financial statements included or
incorporated by reference in the Registration Statement, together with
the related notes thereto, present fairly in all material respects the
financial position of the Company and its consolidated subsidiaries at
the dates indicated and the consolidated results of operations and cash
flows of the Company and its consolidated subsidiaries for the periods
specified. Such financial statements have been prepared in conformity
with generally accepted accounting principles applied on a consistent
basis throughout the periods involved, except as otherwise stated
therein and except that the unaudited financial statements do not
include all required footnotes. The financial statement schedules, if
any, included or incorporated by reference in the Registration Statement
present the information required to be stated therein.
(ix) The Company is a "citizen of the United States" within the
meaning of Section 40102(a)(15) of Title 49 of the United States Code,
as amended, holding an air carrier operating certificate issued by the
Secretary of Transportation pursuant to Chapter 447 of Title 49 of the
United States Code, as amended, for aircraft capable of carrying 10 or
more individuals or 6,000 pounds or more of cargo.
(x) The Notes have been duly authorized by the Company; when
executed, authenticated, issued and delivered in the manner provided for
in the Indenture and sold and paid for as provided in this Agreement,
the Notes will constitute valid and binding obligations of the Company
entitled to the benefits of the Indenture, enforceable against the
Company in accordance with their terms, except as enforcement thereof
may be limited by bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent transfers), reorganization, moratorium
or other similar laws now or hereafter
4
<PAGE> 6
in effect relating to creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law); and the Notes will conform in all material respects
to the description thereof to be contained in the Prospectus.
(xii) Except as disclosed in the Prospectus, the Company and the
Subsidiaries have good and marketable title to all real properties and
all other properties and assets owned by them, in each case free from
liens, encumbrances and defects except where the failure to have such
title would not have a Material Adverse Effect; and except as disclosed
in the Prospectus, the Company and the Subsidiaries hold any leased real
or personal property under valid and enforceable leases with no
exceptions that would have a Material Adverse Effect.
(xiii) Except as disclosed in the Prospectus, there is no action,
suit or proceeding before or by any governmental agency or body or
court, domestic or foreign, now pending or, to the knowledge of the
Company, threatened against the Company or any of its subsidiaries or
any of their respective properties that individually (or in the
aggregate in the case of any class of related lawsuits), could
reasonably be expected to have a Material Adverse Effect or that could
reasonably be expected to materially and adversely affect the
consummation of the transactions contemplated by this Agreement.
(xiv) Except as disclosed in the Prospectus, no labor dispute
with the employees of the Company or any subsidiary exists or to the
knowledge of the Company is imminent that could reasonably be expected
to have a Material Adverse Effect.
(xv) Each of the Company and the Subsidiaries has all necessary
consents, authorizations, approvals, orders, certificates and permits of
and from, and has made all declarations and filings with, all federal,
state, local and other governmental authorities, all self-regulatory
organizations and all courts and other tribunals, to own, lease, license
and use its properties and assets and to conduct its business in the
manner described in the Prospectus, except to the extent that the
failure to so obtain, declare or file would not have a Material Adverse
Effect.
(xvi) Except as disclosed in the Prospectus, neither the Company
nor any of the Subsidiaries is in violation of any statute, rule,
regulation, decision or order of any governmental agency or body or any
court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances (collectively, "environmental laws"), owns
or operates any real property contaminated with any substance that is
subject to any environmental laws, or is subject to any claim relating
to any environmental laws, which violation, contamination, liability or
claim individually or in the aggregate is reasonably expected to have a
Material Adverse Effect; and the
5
<PAGE> 7
Company is not aware of any pending investigation which might lead to
such a claim that is reasonably expected to have a Material Adverse
Effect.
(xvii) The accountants that examined and issued an auditors'
report with respect to the consolidated financial statements of the
Company and the financial statement schedules, if any, included or
incorporated by reference in the Registration Statement are independent
public accountants within the meaning of the Securities Act.
(b) The parties agree that any representation or warranty
contained in a certificate signed by a duly authorized officer of the Company
and delivered to an Underwriter, or to counsel for the Underwriters, in each
case on the Closing Date and in connection with this Agreement or the offering
of the Notes, shall be deemed a representation and warranty by (and only by)
the Company to the Underwriters as to the matters covered thereby.
2. Purchase, Sale and Delivery of Notes. (a) On the basis
of the representations, warranties and agreements herein contained, but subject
to the terms and the conditions herein set forth, the Company agrees to sell to
each Underwriter, and each Underwriter agrees, severally and not jointly, to
purchase from the Company the respective principal amount of Notes set forth in
Schedule I hereto opposite their names at a purchase price of 98.0% of the
principal amount thereof, plus accrued interest, if any, from December 14, 1998
to the date of payment and delivery.
(b) The Company is advised by you that the Underwriters
propose to make a public offering of the Notes as soon after this Agreement has
been entered into as in your judgment is advisable. The Company is further
advised by you that the Notes are to be offered to the public initially at 100%
of their principal amount -- the public offering price -- plus accrued
interest, if any, and to certain dealers selected by the Underwriters at
concessions not in excess of the concessions set forth in the Prospectus, and
that the Underwriters may allow, and such dealers may re-allow, concessions not
in excess of the concessions set forth in the Prospectus to certain other
dealers.
(c) Delivery of and payment for the Notes shall be made at the
offices of Shearman & Sterling at 599 Lexington Avenue, New York, New York
10022 at 10:00 A.M. on December 14, 1998 or such other date, time and place as
may be agreed upon by the Company and you (such date and time of delivery and
payment for the Notes being herein called the "Closing Date"). Delivery of the
Notes shall be made to your account at The Depository Trust Company for the
respective accounts of the several Underwriters against payment by the
Underwriters of the purchase price thereof to or upon the order of the Company
by wire transfer. The Notes shall be registered in the name of Cede & Co. or
in such other names, and in such denominations, as you may request in writing
at least two full business days in advance of the Closing Date.
6
<PAGE> 8
(d) The Company agrees to have the Notes available for
inspection, checking and packaging by you in New York, New York not later than
1:00 P.M. on the business day prior to the Closing Date.
3. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase and pay for the Notes pursuant to
this Agreement are subject to the following conditions:
(a) On the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued under
the Securities Act and no proceedings therefor shall have been
instituted or threatened by the Commission.
(b) On the Closing Date, you shall have received an opinion of
Vinson & Elkins L.L.P., as counsel for the Company, dated the Closing
Date, in form and substance reasonably satisfactory to you and
substantially to the effect set forth in Exhibit A hereto.
(c) On the Closing Date, you shall have received an opinion of
the General Counsel of the Company, dated the Closing Date, in form and
substance reasonably satisfactory to you and substantially to the effect
set forth in Exhibit B hereto.
(d) On the Closing Date, you shall have received an opinion of
Shearman & Sterling, as counsel for the Underwriters, dated as of the
Closing Date, with respect to the issuance and sale of the Notes, the
Registration Statement, the Prospectus and other related matters as the
Underwriters may reasonably require.
(e) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred any change, or any development
or event involving a prospective change, in the condition (financial or
other), business, properties or results of operations of the Company and
its subsidiaries considered as one enterprise that, in your judgment, is
material and adverse and that makes it, in your judgment, impracticable
to proceed with the completion of the public offering of the Notes on
the terms and in the manner contemplated by the Prospectus.
(f) You shall have received on the Closing Date a certificate,
dated the Closing Date and signed by the President or any Vice President
of the Company, to the effect that the representations and warranties of
the Company contained in this Agreement are true and correct as of the
Closing Date (except to the extent that they relate solely to an earlier
date in which case they shall be accurate as of such earlier date), that
the Company has performed all its obligations to be performed hereunder
on or prior to the Closing Date and that, subsequent to the execution
and delivery of this Agreement, there shall not have occurred any
material adverse change, or any development or event involving a
prospective material adverse change, in the condition
7
<PAGE> 9
(financial or other), business, properties or results of operations of
the Company and its subsidiaries considered as one enterprise, except as
set forth in or contemplated by the Prospectus.
(g) On the Closing Date, you shall have received a letter,
dated the Closing Date, of Ernst & Young LLP in a form and substance
satisfactory to you, containing statements and information of the type
ordinarily included in accountants' "comfort letters".
(h) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date, there shall not have been any downgrading
in the rating accorded any of the Company's securities, except for any
downgrading of pass through certificates, by any "nationally recognized
statistical rating organization", as such term is defined for purposes
of Rule 436(g)(2) under the Securities Act, or any public announcement
that any such organization has under surveillance or review its ratings
of any such securities (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating).
(i) On or prior to the Closing Date, counsel for the
Underwriters shall have been furnished with such documents and opinions
as such counsel may reasonably require for the purpose of enabling such
counsel to pass upon the issuance and sale of Notes as herein
contemplated and related proceedings, or in order to evidence the
accuracy of any of the representations and warranties, or the
fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company in connection with the issuance and
sale of Notes as herein contemplated shall be reasonably satisfactory in
form and substance to you.
4. Certain Covenants of the Company. The Company covenants
with each Underwriter as follows:
(a) During the period described in the following sentence of
this Section 4(a), the Company shall advise you promptly of any proposal
to amend or supplement the Registration Statement or the Prospectus
(except by documents filed under the Exchange Act) and will not effect
such amendment or supplement (except by documents filed under the
Securities Act or the Exchange Act) without your consent, which consent
shall not be unreasonably withheld. If, at any time after the public
offering of the Notes, the Prospectus is required by law to be delivered
in connection with sales by an Underwriter or dealer, any event shall
occur as a result of which it is necessary to amend the Registration
Statement or amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading in any material
respect, or if it is necessary to amend the Registration Statement or
amend or supplement the Prospectus to comply with law, the Company shall
prepare and furnish, at its own expense, to the
8
<PAGE> 10
Underwriters and to the dealers (whose names and addresses you will
furnish to the Company) to which Notes may have been sold by you on
behalf of the Underwriters and to any other dealers upon request, either
amendments or supplements to the Prospectus so that the statements in
the Prospectus as so amended or supplemented will not, in the light of
the circumstances when the Prospectus is delivered to a purchaser, be
misleading in any material respect or amendments or supplements to the
Registration Statement or the Prospectus so that the Registration
Statement or the Prospectus, as so amended or supplemented, will comply
with law and cause such amendments or supplements to be filed promptly
with the Commission.
(b) During the period mentioned in paragraph (a) above, the
Company shall notify each Underwriter immediately of (i) the
effectiveness of any amendment to the Registration Statement, (ii) the
transmittal to the Commission for filing of any supplement to the
Prospectus or any document that would as a result thereof be
incorporated by reference in the Prospectus, (iii) the receipt of any
comments from the Commission with respect to the Registration Statement,
the Prospectus or the Prospectus Supplement, (iv) any request by the
Commission for any amendment to the Registration Statement or any
supplement to the Prospectus or for additional information relating
thereto or to any document incorporated by reference in the Prospectus
and (v) receipt by the Company of any notice of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement, the suspension of the qualification of the Notes
for offering or sale in any jurisdiction, or the institution or
threatening of any proceeding for any of such purposes; and the Company
agrees to use every reasonable effort to prevent the issuance of any
such stop order and, if any such order is issued, to obtain the lifting
thereof at the earliest possible moment and the Company shall (subject
to the proviso in Section 4(e)) endeavor, in cooperation with the
Underwriters, to prevent the issuance of any such stop order suspending
such qualification and, if any such order is issued, to obtain the
lifting thereof at the earliest possible moment, all of the foregoing at
the expense of the Company.
(c) During the period mentioned in paragraph (a) above, the
Company will furnish to each of the Underwriters as many conformed
copies of the Registration Statement (as originally filed) and all
amendments and supplements to such documents (excluding all exhibits and
documents filed therewith or incorporated by reference therein) and as
many conformed copies of all consents and certificates of experts, in
each case as soon as available and in such quantities as each of the
Underwriters reasonably requests.
(d) Promptly following the execution of this Agreement, the
Company will prepare a Prospectus Supplement that complies with the
Securities Act and that sets forth the principal amount of the Notes and
their terms not otherwise specified in the base prospectus included in
the Registration Statement, the name of each Underwriter
9
<PAGE> 11
participating in the offering and the principal amount of the Notes that
each severally has agreed to purchase, the name of each Underwriter, if
any, acting as representative of the Underwriters in connection with the
offering, the price at which the Notes are to be purchased by the
Underwriters from the Company, any initial public offering price, any
selling concession and reallowance and any delayed delivery
arrangements, and such other information as you and the Company deem
appropriate in connection with the offering of the Notes. The Company
will timely transmit copies of the Prospectus Supplement to the
Commission for filing pursuant to Rule 424 under the Securities Act.
(e) The Company shall, in cooperation with the Underwriters,
endeavor to arrange for the qualification of the Notes for offer and
sale under the applicable securities or "blue sky" laws of such
jurisdictions in the United States as Morgan Stanley reasonably
designates and will endeavor to maintain such qualifications in effect
so long as required for the distribution of such Notes, all at the
expense of the Company; provided that the Company shall not be required
to (i) qualify as a foreign corporation or as a dealer in securities,
(ii) file a general consent to service of process or (iii) subject
itself to taxation in any such state.
(f) During the period the Notes remain outstanding, the
Company will promptly furnish to each of the Underwriters, upon request,
copies of all Annual Reports on Form 10-K and any definitive proxy
statement of the Company filed with the Commission.
(g) Between the date of this Agreement and the Closing Date,
the Company shall not, without your prior written consent, offer, sell,
or enter into any agreement to sell (as public debt securities
registered under the Securities Act (other than the Notes) or as debt
securities that may be resold in a transaction exempt from the
registration requirements of the Securities Act in reliance on Rule 144A
thereunder and that are marketed through the use of a disclosure
document containing substantially the same information as a prospectus
for similar debt securities registered under the Securities Act), any
unsecured notes, debentures or other evidences of unsecured
indebtedness.
5. Indemnification and Contribution. (a) The Company agrees
that it will indemnify and hold harmless each Underwriter, and each person, if
any, who controls any Underwriter within the meaning of either Section 15 of
the Securities Act or Section 20 of the Exchange Act from and against any and
all losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred by any Underwriter or any such
controlling person in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement, or any amendment
thereof, or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto), 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 light of the
circumstances under which
10
<PAGE> 12
they were made, not misleading, except insofar as such losses, claims, damages
or liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon (i) Underwriter Information (as defined
in Section 1(a)(i) of this Agreement) or (ii) statements or omissions in that
part of such Registration Statement which shall constitute the Statement of
Eligibility of the Trustee under the Trust Indenture Act.
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, each of the officers
who signed the Registration Statement and each person, if any, who controls the
Company, as the case may be, within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company to such Underwriter but only with
reference to the Underwriter Information applicable to such Underwriter.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to either paragraph (a) or (b) above, such
person (the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (the "indemnifying party"), in writing. The
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding
and the indemnifying party shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to the
retention of such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between them.
It is understood that the indemnifying party shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
fees and expenses of more than one separate firm (in addition to any local
counsel) for all such indemnified parties and that all such fees and expenses
shall be reimbursed as they are incurred. Any such firm retained pursuant to
the third sentence of this paragraph (c) shall be designated in writing by
Morgan Stanley in the case of parties indemnified pursuant to paragraph (a)
above and by the Company in the case of parties indemnified pursuant to
paragraph (b) above. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested in writing an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the
second and third sentences of this paragraph, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than 90 days
after receipt by such indemnifying party of the aforesaid
11
<PAGE> 13
request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement, unless such fees and expenses are being disputed in good faith. 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.
(d) To the extent the indemnification provided for in
paragraph (a) or (b) of this Section 5 is required to be made but is
unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages or liabilities, then each indemnifying party under such
paragraph, in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company, on the
one hand, and the Underwriters, on the other hand, from the offering of such
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, on the one hand, and the Underwriters on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company, on the one
hand, and the Underwriters, on the other hand, in connection with the offering
of such Notes shall be deemed to be in the same respective proportions as the
proceeds from the offering of such Notes received by the Company (before
deducting expenses), and the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in (or in the notes to)
the table on the cover of the Prospectus, bear to the aggregate public offering
price of such Notes. The relative fault of the Company, on the one hand, and
of the Underwriters, on the other hand, shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or Underwriter Information, and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Underwriters'
respective obligations to contribute pursuant to this Section 5 are several in
proportion to the respective principal amount of Notes they have purchased
hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not
be just or equitable if contribution pursuant to this Section 5 were determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account
of the equitable considerations referred to in paragraph (d) above. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such
12
<PAGE> 14
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 5, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Notes underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages that such
Underwriter 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 indemnity and contribution
provisions contained in this Section 5 and the representations and warranties
of the Company contained in this Agreement shall remain operative and in full
force and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter or by or on behalf of the Company, each of their respective
officers or directors or any person controlling the Company and (iii)
acceptance of and payment for any of the Notes. The remedies provided for in
this Section 5 are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in equity.
6. Default of Underwriters. If either Underwriter defaults
in its obligations to purchase Notes hereunder and the aggregate principal
amount of the Notes with respect to which such default or defaults occur
exceeds 10% of the total principal amount of the Notes and arrangements
satisfactory to Morgan Stanley and the Company for the purchase of such Notes
by other persons are not made within 36 hours after such default, this
Agreement will terminate without liability on the part of any non-defaulting
Underwriter or the Company, except as provided in Section 5. As used in this
Agreement, the term "Underwriter" includes any person substituted for an
Underwriter under this Section. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
7. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, or its officers and of the Underwriters set forth in
or made pursuant to this Agreement will remain in full force and effect,
regardless of any termination of this agreement, any investigation, or
statement as to the results thereof, made by or on behalf of any Underwriter,
the Company, or any of its representatives, officers or directors or any
controlling person and will survive delivery of and payment for the Notes. If
for any reason the purchase of the Notes by the Underwriters is not
consummated, the Company shall remain responsible for the expenses to be paid
or reimbursed by it pursuant to Section 9 and the respective obligations of the
Company and the Underwriters pursuant to Section 5 shall remain in effect. If
the purchase of the Notes by the Underwriters is not consummated for any reason
other than solely because of the occurrence of the termination of the Agreement
pursuant to Section 6 or 8, the Company will reimburse the Underwriters for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
reasonably incurred by them in connection with the offering of such Notes and
comply with its obligations under Section 9.
13
<PAGE> 15
8. Termination. This Agreement shall be subject to
termination by notice given by Morgan Stanley to the Company, if (a) after the
execution and delivery of this Agreement and prior to the Closing Date (i)
trading generally shall have been suspended or materially limited on or by, as
the case may be, any of the New York Stock Exchange, the American Stock
Exchange or the National Association of Securities Dealers, Inc., (ii) trading
of any securities of the Company shall have been suspended on any exchange or
in any over-the-counter market, (iii) a general moratorium on commercial
banking activities in New York shall have been declared by either Federal or
New York State authorities or (iv) there shall have occurred any outbreak or
escalation of hostilities or any change in financial markets or any calamity or
crisis that, in Morgan Stanley's judgment, is material and adverse and (b) in
the case of any of the events specified in clauses (a)(i) through (iv), such
event singly or together with any other such event makes it, in Morgan
Stanley's judgment, impracticable to market the Notes on the terms and in the
manner contemplated in the Prospectus.
9. Payment of Expenses. The Company shall pay all of the
following costs and expenses:
(i) expenses (including filing fees and reasonable fees and
disbursements of counsel for the Underwriters in connection therewith)
incurred in connection with (A) qualifying the Notes for offer and sale
under the applicable securities or "blue sky" laws of such jurisdictions
in the United States as Morgan Stanley reasonably designates, (B)
endeavoring to maintain such qualifications in effect so long as
required for the distribution of such Notes, (C) the review (if any) of
the offering of the Notes by the National Association of Securities
Dealers, Inc., (D) the determination of the eligibility of the Notes for
investment under the laws of such jurisdictions as the Underwriters may
designate and (E) the preparation, printing and distribution of any blue
sky or legal investment memorandum by Underwriters' Counsel;
(ii) expenses incurred in connection with the preparation and
distribution to the Underwriters and the dealers (whose names and
addresses the Underwriters will furnish to the Company) to which Notes
may have been sold by the Underwriters on their behalf and to any other
dealers upon request, either of (A) amendments to the Registration
Statement or amendments or supplements to the Prospectus in order to
make the statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not materially misleading or (B)
amendments or supplements to the Registration Statement or the
Prospectus so that the Registration Statement or the Prospectus, as so
amended or supplemented, will comply with law and the expenses incurred
in connection with causing such amendments or supplements to be filed
promptly with the Commission;
(iii) all expenses incident to the performance of the Company's
obligations under this Agreement;
14
<PAGE> 16
(iv) expenses incurred in connection with the preparation,
printing and filing of the Registration Statement (including financial
statements and exhibits), as originally filed and as amended, the
Prospectus and any amendments thereof and supplements thereto, and the
cost of furnishing copies thereof to the Underwriters;
(v) expenses incurred in connection with the preparation,
printing and distribution of this Agreement and the Notes;
(vi) expenses incurred in connection with the delivery of the
Notes;
(vii) reasonable fees and disbursements of the counsel and
accountants for the Company;
(viii) fees and expenses of the Trustee and the reasonable fees
and disbursements of counsel for the Trustees;
(ix) fees charged by rating agencies for rating the Notes
(including annual surveillance fees related to the Notes as long as they
are outstanding); and
(xi) all other expenses reasonably incurred by the Underwriters
(other than fees and disbursements of their counsel) in connection with
the transactions contemplated by this Agreement.
10. Notices. All communications hereunder will be in writing
and, if sent to the Underwriters, will be mailed, delivered or sent by
facsimile transmission and confirmed to the Underwriters, c/o Morgan Stanley &
Co. Incorporated, 1585 Broadway, New York, N.Y. 10036, Attention: High Yield
Syndication Desk, if sent to the Company, will be mailed, delivered or sent by
facsimile transmission and confirmed to it at 1600 Smith Street, Houston, TX
77002, Attention: Chief Financial Officer and General Counsel, facsimile
number (713) 520-6329; provided, however, that any notice to an Underwriter
pursuant to Section 5 will be sent by facsimile transmission or delivered and
confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 5, and no other person will have any
right or obligation hereunder.
12. Representation of Underwriters. Morgan Stanley will act
for the several Underwriters in connection with this purchase, and any action
under this Agreement taken jointly or by Morgan Stanley will be binding upon
all the Underwriters.
15
<PAGE> 17
13. Counterparts. This Agreement may be executed in any
number of counterparts, each of which will be deemed to be an original, but all
such counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW.
15. Jurisdiction. Each of the parties hereto agrees that any
legal suit, action or proceeding arising out of or relating to this Agreement
or the transactions contemplated hereby may be instituted in any U.S. federal
or New York State court in the Borough of Manhattan in the City of New York
(each a "New York court") and each of the parties hereto hereby irrevocably
waives any objection that it may now or hereafter have to the laying of venue
of any such proceeding, and irrevocably submits to the jurisdiction of such
courts, with respect to actions brought against it as defendant, in any suit,
action or proceeding. Each of the parties to this Agreement agrees that a
final judgment in any such suit, action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law in accordance with applicable law.
16
<PAGE> 18
If the foregoing is in accordance with the Underwriters'
understanding of our agreement, kindly sign and return to the Company one of
the counterparts hereof, whereupon it will become a binding agreement among the
Underwriters and the Company in accordance with its terms.
Very truly yours,
CONTINENTAL AIRLINES, INC.
By: /s/ JENNIFER L. VOGEL
------------------------------
Name: Jennifer L. Vogel
Title: Vice President
The foregoing Underwriting Agreement
is hereby confirmed and accepted
as of the date first above written
MORGAN STANLEY & CO. INCORPORATED
CREDIT SUISSE FIRST BOSTON CORPORATION
By: MORGAN STANLEY & CO. INCORPORATED
By: /s/ MORGAN STANLEY & CO. INCORPORATED
--------------------------------------
Name:
Title:
17
<PAGE> 19
SCHEDULE I
<TABLE>
<CAPTION>
Underwriters Principal Amount
Of Notes to
Be Purchased
----------------
<S> <C>
Morgan Stanley & Co. Incorporated . . . . . . . . . . . . . . $ 160,000,000
Credit Suisse First Boston Corporation . . . . . . . . . . . 40,000,000
---------------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 200,000,000
===============
</TABLE>
<PAGE> 20
EXHIBIT A
Form of legal opinion to be rendered by Vinson and Elkins,
Counsel for the Company
1. Continental is validly existing as a corporation in good
standing under the laws of the State of Delaware.
2. Continental has the corporate power (i) to own, lease and
operate its properties and conduct its business as described in the Prospectus
and (ii) to enter into each of the Indenture and the Underwriting Agreement and
to perform its obligations thereunder.
3. The execution and delivery by Continental of the
Underwriting Agreement have been duly authorized by all necessary corporation
action of Continental, and the Underwriting Agreement has been duly executed
and delivered by Continental.
4. The statements set forth under the heading "Description of
Notes", in the Prospectus Supplement, insofar as such statements purport to
summarize certain provisions of the Notes, provide a fair summary of such
provisions.
5. The statements set forth under the heading "Tax
Considerations" in the Prospectus Supplement, insofar as such statements
purport to address the federal income tax laws of the United States, are
accurate in all material respects with respect to the matters discussed
therein.
6. Continental is not an "investment company", and
Continental is not a company "controlled" by an "investment company", in each
case within the meaning of the Investment Company Act of 1940, as amended (the
"Investment Company Act").
7. The issuance and sale of the Notes to the Underwriters
pursuant to the Underwriting Agreement does not require Continental to obtain
or effect any consent, approval, authorization, registration or qualification
of or with any governmental agency or body of the United States or of the State
of New York, except such as are required under the Securities Act, the Trust
Indenture Act of 1939, as amended, and the rules and regulation thereunder
(collectively, the "Trust Indenture Act"), and the securities or blue sky laws
of the various states. Neither the execution and delivery by Continental of
the Underwriting Agreement nor the consummation by Continental of the
transactions contemplated thereby to be consummated on the date hereof violates
(i) Continental's Certificate of Incorporation or By-Laws or (ii) any law or
governmental rule or regulation known to us to be applicable to, or binding on,
Continental.
8. The Registration Statement has become effective under the
Securities Act and, to our knowledge, (i) no stop order suspending the
effectiveness of the Registration
<PAGE> 21
Statement has been issued and (ii) no proceedings for that purpose have been
instituted or threatened by the Commission.
9. Without independent check or verification of the
statements contained therein, the Registration Statement and the Prospectus
(other than the financial statements, financial statement schedules and other
financial or statistical data included therein, or omitted therefrom, other
matters referred to in the Prospectus under the captions "Experts", Exhibit
12.1 to the Registration Statement and the Statement of Eligibility on Form
T-1, as to which we are not expressing an opinion), in each case, excluding the
documents incorporated or deemed incorporated by reference therein, as of their
respective effective or issue dates, appear on their face to have been
appropriately responsive in all material respects to the requirements of the
Securities Act.
In addition, such counsel shall state that:
We have examined the registration statement on Form S-3
(Registration No. 33-29255) filed by Continental under the Securities Act of
1933, as amended, with the Commission on July 18, 1997 (the registration
statement at the time it became effective, including the exhibits thereto and
the documents incorporated by reference therein, is referred to herein as the
"Registration Statement"), the prospectus included in the Registration
Statement at the effective date of the Registration Statement (the "Base
Prospectus"), and the prospectus supplement dated December 8, 1998 with respect
to the Notes (the "Prospectus Supplement", and the Base Prospectus as
supplemented and modified by the Prospectus Supplement, the "Prospectus"). The
limitations inherent in the independent verification of factual matters and in
the role of outside counsel are such that we cannot and do not assume any
responsibility for the accuracy, completeness or fairness of the statements
made therein and (except to the extent expressly set forth in paragraph 4 of
our opinion letter of even date herewith addressed to each of you), have made
no independent check or verification thereof. In the course of the preparation
of the Registration Statement and the Prospectus, we have, however,
participated in conferences with certain officers and employees of Continental
and with representatives of the Underwriters. Our examination of the
Registration Statement and the Prospectus and our participation in the
above-mentioned conferences did not disclose to us any information that led us
to believe that the Registration Statement (other than the exhibits thereto,
the financial statements, financial statement schedules and other financial or
statistical data included therein, or incorporated or deemed incorporated by
reference therein, or omitted therefrom, and other matters referred to in the
Prospectus under the caption "Experts"), as of its effective date, contained
any untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading, or that the Prospectus (other than the financial
statements, financial statement schedules and other financial or statistical
data included therein, or incorporated or deemed incorporated by reference
therein, or omitted therefrom, and other matters referred to in the Prospectus
under the captions "Experts", as to which we express no belief), as of December
8, 1998 contained, or as of the date hereof contains, any untrue statement of a
material fact or, as of December 8, 1998 omitted, or as of the date hereof
omits, to state a material fact necessary in order to make the statements
therein, in the light of the circumstances in which they were made, not
misleading.
A-2
<PAGE> 22
EXHIBIT B
Form of Company General Counsel's Opinion
1. Each of Continental Express, Inc., Air Micronesia, Inc.,
and Continental Micronesia, Inc. (together, the "Subsidiaries") and Continental
is validly existing as a corporation in good standing under the laws of the
State of Delaware, with corporate power to own, lease and operate its
properties and conduct its business as described in the Prospectus; each of
Continental and its Subsidiaries is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in the United States in
which its ownership or lease of property or the conduct of its business
requires such qualification, except where the failure to be so qualified would
not have a material adverse effect on the business or consolidated financial
condition of Continental and the Subsidiaries taken as a whole.
2. To my knowledge, except as disclosed in the Prospectus,
there is no action, suit or proceeding before or by any governmental agency or
body or court, domestic or foreign, now pending against Continental or any of
the Subsidiaries or any of their respective properties that could reasonably be
expected to have a material adverse effect on the business or consolidated
financial condition of Continental and the Subsidiaries taken as a whole (a
"Material Adverse Effect").
3. Continental is a "citizen of the United States" within the
meaning of Section 40102(a)(15) of Title 49 of the United States Code, as
amended, holding an air carrier operating certificate issued by the Secretary
of Transportation pursuant to Chapter 447 of Title 49 of the United States
Code, as amended, for aircraft capable of carrying 10 or more individuals or
6,000 pounds or more of cargo.
4. The execution, delivery and performance by Continental of
the Underwriting Agreement and the consummation by Continental of the
transactions contemplated therein will not result in any violation of the
provisions of the Certificate of Incorporation or By-Laws of Continental or, to
my knowledge, any applicable law, administrative regulation or any
administrative or court decree, nor does any such action, to my knowledge,
constitute a breach of, or default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any assets of Continental or
any of the Subsidiaries pursuant to, any material contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which Continental
or any of the Subsidiaries is a party or by which any of them are bound or to
which any of the assets of Continental or any of the Subsidiaries is subject.
5. The issuance and sale of the Notes to the Underwriters
pursuant to the Underwriting Agreement and the performance by Continental of
its obligations thereunder do not require Continental to obtain or effect any
consent, approval, authorization, registration or
<PAGE> 23
qualification of or with any governmental agency or body of the United States
or the State of Texas, except such as are required under federal or state
securities or blue sky laws.
6. To my knowledge, except as disclosed in the Prospectus,
there is no event of default under any material agreement or instrument under
which indebtedness of Continental is outstanding or by which it is bound or any
of its properties is subject.
7. To my knowledge, there are no legal or governmental
proceedings pending or threatened against the Company or any Subsidiary that
are required to be disclosed in the Registration Statement, other than those
disclosed therein or those which individually (or in the aggregate in the case
of any class of related lawsuits) could not reasonably be expected to have a
Material Adverse Effect.
8. Each document filed pursuant to the Securities Exchange
Act of 1934, as amended, and the rules and regulation thereunder (the "Exchange
Act"), and incorporated or deemed incorporated by reference in the Registration
Statement or the Prospectus (other than the exhibits thereto, the financial
statements, financial statement schedules and other financial or statistical
data included therein, or incorporated or deemed incorporated therein by
reference, or omitted therefrom, and other matters referred to in the
Prospectus under the captions "Experts", as to which I am not expressing an
opinion), when so filed with the Commission, appeared on its face to have been
appropriately responsive in all material respects to the requirements of the
Exchange Act.
B-2
<PAGE> 1
EXHIBIT 4.2
CONTINENTAL AIRLINES, INC., ISSUER
to
BANK ONE, N.A., TRUSTEE
INDENTURE
DATED AS OF JULY 15, 1997
PROVIDING FOR ISSUANCE OF
SENIOR DEBT SECURITIES IN SERIES
<PAGE> 2
TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
<TABLE>
<S> <C> <C>
Section 1.1. Definitions............................................................................1
Section 1.2. Compliance Certificates and Opinions..................................................10
Section 1.3. Form of Documents Delivered to Trustee................................................11
Section 1.4. Acts of Holders.......................................................................11
Section 1.5. Notices, etc., to Trustee and Company.................................................13
Section 1.6. Notice to Holders; Waiver.............................................................13
Section 1.7. Headings and Table of Contents........................................................14
Section 1.8. Successors and Assigns................................................................14
Section 1.9. Separability..........................................................................14
Section 1.10. Benefits of Indenture.................................................................14
Section 1.11. Governing Law.........................................................................15
Section 1.12. Legal Holidays........................................................................15
Section 1.13. Trustee to Establish Record Dates.....................................................15
Section 1.14. No Security Interest Created..........................................................15
Section 1.15. Liability Solely Corporate............................................................15
ARTICLE 2
SECURITY FORMS
Section 2.1. Forms Generally.......................................................................16
Section 2.2. Form of Trustee's Certificate of Authentication.......................................17
Section 2.3. Securities in Global Form.............................................................17
ARTICLE 3
THE SECURITIES
Section 3.1. Amount Unlimited; Issuable in Series..................................................18
Section 3.2. Denominations.........................................................................22
Section 3.3. Execution, Authentication, Delivery and Dating........................................22
Section 3.4. Temporary Securities..................................................................26
Section 3.5. Registration, Registration of Transfer and Exchange...................................26
Section 3.6. Replacement Securities................................................................30
Section 3.7. Payment of Interest; Interest Rights Preserved........................................32
Section 3.8. Persons Deemed Owners.................................................................33
Section 3.9. Cancellation..........................................................................34
Section 3.10. Computation of Interest...............................................................35
Section 3.11. Currency and Manner of Payment in Respect of Securities...............................35
Section 3.12. Appointment and Resignation of Exchange Rate Agent....................................39
</TABLE>
i
<PAGE> 3
<TABLE>
<S> <C> <C>
Section 3.13. CUSIP Numbers.........................................................................40
Section 3.14. Judgments.............................................................................40
ARTICLE 4
SATISFACTION, DISCHARGE AND DEFEASANCE
Section 4.1. Termination of Company's Obligations Under the Indenture..............................40
Section 4.2. Application of Trust Funds............................................................42
Section 4.3. Applicability of Defeasance Provisions; Company Option to Effect
Defeasance or Covenant Defeasance.....................................................42
Section 4.4. Defeasance and Discharge..............................................................43
Section 4.5. Covenant Defeasance...................................................................43
Section 4.6. Conditions to Defeasance or Covenant Defeasance.......................................44
Section 4.7. Deposited Money and Government Obligations To Be Held in Trust........................45
Section 4.8. Transfers and Distribution at Company Request.........................................46
Section 4.9. Reinstatement.........................................................................46
ARTICLE 5
DEFAULTS AND REMEDIES
Section 5.1. Events of Default.....................................................................47
Section 5.2. Acceleration; Rescission and Annulment................................................48
Section 5.3. Collection of Indebtedness and Suits for Enforcement by Trustee.......................48
Section 5.4. Trustee May File Proofs of Claim......................................................49
Section 5.5. Trustee May Enforce Claims Without Possession of Securities...........................50
Section 5.6. Delay or Omission Not Waiver..........................................................50
Section 5.7. Waiver of Past Defaults...............................................................51
Section 5.8. Control by Majority...................................................................51
Section 5.9. Limitation on Suits by Holders........................................................51
Section 5.10. Rights of Holders to Receive Payment..................................................52
Section 5.11. Application of Money Collected........................................................52
Section 5.12. Restoration of Rights and Remedies....................................................52
Section 5.13. Rights and Remedies Cumulative........................................................53
Section 5.14. Undertaking for Costs.................................................................53
Section 5.15. Waiver of Stay or Extension Laws......................................................53
ARTICLE 6
THE TRUSTEE
Section 6.1. Certain Duties and Responsibilities...................................................53
Section 6.2. Rights of Trustee.....................................................................54
Section 6.3. Trustee May Hold Securities...........................................................55
Section 6.4. Money Held in Trust...................................................................55
Section 6.5. Trustee's Disclaimer..................................................................55
Section 6.6. Notice of Defaults....................................................................55
</TABLE>
ii
<PAGE> 4
<TABLE>
<S> <C> <C>
Section 6.7. Reports by Trustee to Holders.........................................................55
Section 6.8. Securityholder Lists..................................................................56
Section 6.9. Compensation and Indemnity............................................................56
Section 6.10. Replacement of Trustee................................................................57
Section 6.11. Acceptance of Appointment by Successor................................................58
Section 6.12. Eligibility; Disqualification.........................................................59
Section 6.13. Merger, Conversion, Consolidation or Succession to Business...........................59
Section 6.14. Appointment of Authenticating Agent...................................................60
Section 6.15. Trustee's Application for Instructions from the Company...............................61
Section 6.16. Preferential Collection of Claims Against Company.....................................62
ARTICLE 7
CONSOLIDATION, MERGER OR SALE BY THE COMPANY
Section 7.1. Consolidation, Merger or Sale of Assets by the Company Permitted......................62
Section 7.2. Successor Corporation Substituted.....................................................62
ARTICLE 8
SUPPLEMENTAL INDENTURES
Section 8.1. Supplemental Indentures without Consent of Holders....................................63
Section 8.2. Supplemental Indentures with Consent of Holders.......................................64
Section 8.3. Compliance with Trust Indenture Act...................................................65
Section 8.4. Execution of Supplemental Indentures. ...............................................65
Section 8.5. Effect of Supplemental Indentures.....................................................65
Section 8.6. Reference in Securities to Supplemental Indentures....................................65
Section 8.7. Notice of Supplemental Indenture......................................................66
ARTICLE 9
COVENANTS
Section 9.1. Payment of Principal, Premium, if Any, and Interest, if Any...........................66
Section 9.2. Maintenance of Office or Agency.......................................................66
Section 9.3. Money for Securities to Be Held in Trust; Unclaimed Money.............................67
Section 9.4. Corporate Existence...................................................................69
Section 9.5. Reports by the Company................................................................69
Section 9.6. Annual Review Certificate; Notice of Default..........................................69
Section 9.7. Waiver of Certain Covenants and Conditions............................................70
ARTICLE 10
REDEMPTION
Section 10.1. Applicability of Article..............................................................70
Section 10.2. Election to Redeem; Notice to Trustee.................................................70
Section 10.3. Selection of Securities To Be Redeemed................................................70
</TABLE>
iii
<PAGE> 5
<TABLE>
<S> <C> <C>
Section 10.4. Notice of Redemption..................................................................71
Section 10.5. Deposit of Redemption Price...........................................................72
Section 10.6. Securities Payable on Redemption Date.................................................72
Section 10.7. Securities Redeemed in Part...........................................................73
ARTICLE 11
SINKING FUNDS
Section 11.1. Applicability of Article..............................................................73
Section 11.2. Satisfaction of Sinking Fund Payments with Securities.................................74
Section 11.3. Redemption of Securities for Sinking Fund.............................................74
</TABLE>
iv
<PAGE> 6
Reconciliation and tie between Indenture, dated as of July 15, 1997, and the
Trust Indenture Act of 1939, as amended.
<TABLE>
<CAPTION>
TRUST INDENTURE ACT OF 1939 SECTION INDENTURE SECTION
<S> <C>
310(a)(1) 6.12
(a)(2) 6.12
(a)(3) TIA
(a)(4) Not Applicable
(a)(5) TIA
(b) 6.10; 6.12; TIA
311(a) TIA
(b) TIA
(c) Not Applicable
312(a) 6.8
(b) TIA
(c) TIA
313(a) 6.7; TIA
(b) TIA
(c) TIA
(d) TIA
314(a) 9.6; 9.7; TIA
(b) Not Applicable
(c)(1) 1.2
(c)(2) 1.2
(c)(3) Not Applicable
(d) Not Applicable
(e) 1.2
(f) TIA
315(a) TIA
(b) 6.6
(c) TIA
(d)(1) TIA
(d)(2) TIA
(d)(3) TIA
(e) TIA
</TABLE>
<PAGE> 7
<TABLE>
<CAPTION>
TRUST INDENTURE ACT OF 1939 SECTION INDENTURE SECTION
<S> <C>
316(a)(last sentence) 1.1
(a)(1)(A) 5.2; 5.8
(a)(1)(B) 5.7
(b) 5.9; 5.10
(c) TIA
317(a)(1) 5.3
(a)(2) 5.4
(b) 9.3
318(a) 1.11
(b) TIA
(c) 1.11; TIA
</TABLE>
- ------------------------------
This reconciliation and tie section does not constitute part of the Indenture.
2
<PAGE> 8
INDENTURE, dated as of July 15, 1997, among CONTINENTAL
AIRLINES, INC., a Delaware corporation (the "Company"), as issuer, and BANK ONE,
N.A., a national banking association, as Trustee (the "Trustee").
Recitals
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness ("Securities") to be issued
in one or more series as herein provided.
All things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually covenanted and agreed as
follows for the equal and ratable benefit of the Holders of the Securities or
series thereof:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.1. Definitions.
(a) For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the
meanings assigned to them in this Article and include the plural as
well as the singular;
(2) all other terms used herein that are defined in
the Trust Indenture Act, either directly or by reference therein, have
the meanings assigned to them therein;
(3) all accounting terms not otherwise defined herein
have the meanings assigned to them in accordance with generally
accepted accounting principles, and, except as otherwise herein
expressly provided, the term "generally accepted accounting principles"
with respect to any computation required or permitted hereunder shall
mean such accounting principles as are generally accepted in the United
States at the date of such computation; and
(4) the words "herein," "hereof" and "hereunder" and
other words of similar import refer to this Indenture as a whole and
not to any particular Article, Section or other subdivision.
"Affiliate" of any specified Person means any Person directly
or indirectly controlling or controlled by, or under direct or indirect common
control with, such specified Person. For purposes of this definition, "control"
when used with respect to any specified Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
<PAGE> 9
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any Paying Agent or Registrar.
"Authenticating Agent" means any authenticating agent
appointed by the Trustee pursuant to Section 6.14.
"Authorized Newspaper" means a newspaper of general
circulation, in the official language of the country of publication or in the
English language, customarily published on each Business Day whether or not
published on Saturdays, Sundays or holidays, and of general circulation in the
place in connection with which the term is used or in the financial community of
such place. Whenever successive publications in an Authorized Newspaper are
required hereunder they may be made (unless otherwise expressly provided herein)
on any Business Day and in the same or different Authorized Newspapers.
"Bearer Security" means any Security in the form (to the
extent applicable thereto) established pursuant to Section 2.1 which is payable
to bearer (including any Security in global form payable to bearer) and title to
which passes by delivery only, but does not include any coupons.
"Board" or "Board of Directors" means the Board of Directors
of the Company, the Executive Committee of the Company or any other duly
authorized committee of such Board of Directors authorized to exercise the power
of the Board of Directors, in whole or in part, in the management of the
business and affairs of the Company.
"Board Resolution" means a copy of a resolution of the Board
of Directors, certified by the Secretary or an Assistant Secretary of the
Company to have been duly adopted by the Board of Directors and to be in full
force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day", when used with respect to any Place of Payment
or any other particular location referred to in this Indenture or in the
Securities, means, unless otherwise specified with respect to any Securities
pursuant to Section 3.1, each Monday, Tuesday, Wednesday, Thursday and Friday
that is not a day on that banking institutions in that Place of Payment or
particular location are authorized or obligated by law or executive order to
close.
"Capital Lease" means any lease obligation of a Person
incurred with respect to real property or equipment acquired or leased by such
Person and used in its business that is required to be recorded on its balance
sheet as a capitalized lease in accordance with generally accepted accounting
principles consistently applied.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934, as amended, or, if at any time after the execution of this Indenture such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act, then the body performing such duties at such time.
2
<PAGE> 10
"Company" means the Person named as the Company in the first
paragraph of this Indenture until one or more successor corporations shall have
become such pursuant to the applicable provisions of this Indenture, and
thereafter means such successor or successors.
"Company Order" and "Company Request" mean, respectively, a
written order or request signed in the name of the Company by the Chairman of
the Board, the President, any Executive Vice President, any Senior Vice
President or any Vice President, signing alone, or, with respect to Sections
3.3, 3.4, 3.5 and 6.1, any other employee of the Company named in an Officer's
Certificate delivered to the Trustee.
"Conversion Event" means the cessation of use of (i) a Foreign
Currency both by the government of the country which issued such currency and
for the settlement of transactions by a central bank or other public
institutions of or within the international banking community, (ii) the ECU both
within the European Monetary System and for the settlement of transactions by
public institutions of or within the European Communities or (iii) any currency
unit other than the ECU for the purposes for which it was established.
"Corporate Trust Office" means the principal corporate trust
office of the Trustee at which at any particular time its corporate trust
business shall be principally administered, which office at the date hereof is
located at 100 East Broad Street, Columbus, Ohio 43215.
"Corporation" includes corporations, associations, companies
and business trusts.
"Coupon" means any interest coupon appertaining to a Bearer
Security.
"Default" means any event which is, or after notice or passage
of time, or both, would be, an Event of Default.
"Depositary", when used with respect to the Securities of or
within any series issuable or issued in whole or in part in global form, means
the Person designated as Depositary by the Company pursuant to Section 3.1 until
a successor Depositary shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter shall mean or include each Person
which is then a Depositary hereunder, and if at any time there is more than one
such Person, shall be a collective reference to such Persons.
"Dollar" and the sign "$" mean the coin or currency of the
United States which at the time of payment is legal tender for the payment of
public and private debts.
"ECU" means European Currency Unit as defined and revised from
time to time by the Council of the European Communities.
"European Communities" means European Economic Community, the
European Coal and Steel Community and the European Atomic Energy Community.
3
<PAGE> 11
"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of the European
Communities.
"Exchange Rate Agent", when used with respect to Securities of
or within any series, means, unless otherwise specified with respect to any
Securities pursuant to Section 3.1, a New York Clearing House bank designated
pursuant to Section 3.1 or Section 3.12.
"Exchange Rate Officer's Certificate" means a certificate
setting forth (i) the applicable Market Exchange Rate or the applicable bid
quotation and (ii) the Dollar or Foreign Currency amounts of principal (and
premium, if any) and interest, if any (on an aggregate basis and on the basis of
a Security having the lowest denomination principal amount in the relevant
currency or currency unit), payable with respect to a Security of any series on
the basis of such Market Exchange Rate or the applicable bid quotation, signed
by the Treasurer, any Executive Vice President, any Senior Vice President, any
Vice President or any Assistant Treasurer of the Company.
"Foreign Currency" means any currency issued by the government
of one or more countries other than the United States or by any recognized
confederation or association of such governments.
"Government Obligations" means securities that are (i) direct
obligations of the United States or, if specified as contemplated by Section
3.1, the government that issued the currency in which the Securities of a
particular series are payable, for the payment of which its full faith and
credit is pledged or (ii) obligations of a Person controlled or supervised by
and acting as an agency or instrumentality of the United States or, if specified
as contemplated by Section 3.1, such government that issued the foreign currency
in which the Securities of such series are payable, the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United
States or such other government, which, in either case, are not callable or
redeemable at the option of the issuer thereof, and shall also include a
depositary receipt issued by a bank or trust company as custodian with respect
to any such Government Obligation or a specific payment of interest on or
principal of any such Government Obligation held by such custodian for the
account of the holder of a depositary receipt, provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depositary receipt from any amount received by the
custodian in respect of the Government Obligation evidenced by such depositary
receipt.
"Holder" means, with respect to a Bearer Security or coupon, a
bearer thereof and, with respect to a Registered Security, a Person in whose
name a Security is registered on the Register.
"Indenture" means this Indenture as originally executed or as
amended or supplemented from time to time and shall include the forms and terms
of particular series of Securities established as contemplated by Sections 2.1
and 3.1; provided, however, that, with respect to terms defined in any Board
Resolution relating to the establishment of a series of Securities, such defined
terms shall apply only to such series.
4
<PAGE> 12
"Indexed Security" means a Security the terms of which provide
that the principal amount thereof payable at Stated Maturity may be more or less
than the principal face amount thereof at original issuance.
"Interest", when used with respect to an Original Issue
Discount Security that by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date", when used with respect to any
Security, means the Stated Maturity of an installment of interest on such
Security.
"Market Exchange Rate" means, unless otherwise specified with
respect to any Securities pursuant to Section 3.1, (i) for any conversion
involving a currency unit on the one hand and Dollars or any Foreign Currency on
the other, the exchange rate between the relevant currency unit and Dollars or
such Foreign Currency calculated by the method specified pursuant to Section 3.1
for the Securities of the relevant series, (ii) for any conversion of Dollars
into any Foreign Currency, the noon buying rate for such Foreign Currency for
cable transfers quoted in New York City as certified for customs purposes by the
Federal Reserve Bank of New York and (iii) for any conversion of one Foreign
Currency into Dollars or another Foreign Currency, the spot rate at noon local
time in the relevant market at which, in accordance with normal banking
procedures, the Dollars or Foreign Currency into which conversion is being made
could be purchased with the Foreign Currency from which conversion is being made
from major banks located in New York City, London or any other principal market
for Dollars or such purchased Foreign Currency, in each case determined by the
Exchange Rate Agent. Unless otherwise specified with respect to any Securities
pursuant to Section 3.1, in the event of the unavailability of any of the
exchange rates provided for in the foregoing clauses (i), (ii) and (iii), the
Exchange Rate Agent shall use, in its sole discretion and without liability on
its part, such quotation of the Federal Reserve Bank of New York as of the most
recent available date, or quotations from one or more major banks in New York
City, London or other principal market for such currency or currency unit in
question (which may include any such bank acting as Trustee under this
Indenture), or such other quotations as the Exchange Rate Agent shall deem
appropriate. Unless otherwise specified by the Exchange Rate Agent, if there is
more than one market for dealing in any currency or currency unit by reason of
foreign exchange regulations or otherwise, the market to be used in respect of
such currency or currency unit shall be that in which a nonresident issuer of
securities designated in such currency or currency unit would purchase such
currency or currency unit in order to make payments in respect of such
securities.
"Maturity" when used with respect to any Security, means the
date on which the principal of such Security or an installment of principal
becomes due and payable as therein or herein provided, whether at the Stated
Maturity or by declaration of acceleration, call for redemption or otherwise.
"Officer" means the Chairman of the Board, the President, any
Executive Vice President, any Senior Vice President, any Vice President, the
Treasurer or Secretary of the Company.
"Officer's Certificate" means a certificate signed by an
Officer of the Company signing alone, and delivered to the Trustee.
5
<PAGE> 13
"Opinion of Counsel" means a written opinion of legal counsel,
who may be (a) an attorney employed by the Company or (b) other counsel
designated by the Company and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means any Security that
provides for an amount less than the stated principal amount thereof to be due
and payable upon declaration of acceleration of the Maturity thereof pursuant to
Section 5.2.
"Outstanding," when used with respect to Securities, means, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore canceled by the Trustee
or delivered to the Trustee for cancellation;
(ii) Securities, or portions thereof, for payment or
redemption of which money in the necessary amount has been theretofore
deposited with the Trustee or any Paying Agent (other than the Company)
in trust or set aside and segregated in trust by the Company (if the
Company shall act as its own Paying Agent) for the Holders of such
Securities and any coupons appertaining thereto; provided, however, if
such Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made;
(iii) Securities, except to the extent provided in
Sections 4.4 and 4.5., with respect to which the Company has effected
defeasance and/or covenant defeasance as provided in Article 4; and
(iv) Securities that have been paid pursuant to
Section 3.6 or in exchange for or in lieu of which other Securities
have been authenticated and delivered pursuant to this Indenture, other
than any such Securities in respect of which there shall have been
presented to the Trustee proof satisfactory to it that such Securities
are held by a bona fide purchaser in whose hands such Securities are
valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, or whether
sufficient funds are available for redemption or for any other purpose, and for
the purpose of making the calculations required by Section 313 of the Trust
Indenture Act, (w) the principal amount of any Original Issue Discount
Securities that may be counted in making such determination or calculation and
that shall be deemed to be Outstanding for such purpose shall be equal to the
amount of principal thereof that would be (or shall have been declared to be)
due and payable, at the time of such determination, upon a declaration of
acceleration of the Maturity thereof pursuant to Section 5.2, (x) the principal
amount of any Security denominated in a Foreign Currency that may be counted in
making such determination or calculation and that shall be deemed Outstanding
for such purpose shall be equal to the Dollar equivalent, determined as of the
date such Security is originally issued by the Company as set forth in an
Exchange Rate Officer's Certificate delivered to the Trustee, of the principal
amount (or, in the case of the Original Issue Discount
6
<PAGE> 14
Security, the Dollar equivalent as of such date of original issuance of the
amount determined as provided in clause (w) above) of such Security, (y) the
principal amount of any Indexed Security that may be counted in making such
determination or calculation and that shall be deemed Outstanding for such
purpose shall be equal to the principal face amount of such Indexed Security at
original issuance, unless otherwise provided with respect to such Security
pursuant to Section 3.1 and (z) Securities owned by the Company or any other
obligor upon the Securities or any Affiliate of the Company or of such other
obligor shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in making such calculation or
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities that the Trustee knows to be so owned shall
be so disregarded. Securities so owned that have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of, premium, if any, or interest, if any, on any Securities on
behalf of the Company.
"Periodic Offering" means an offering of Securities of a
series from time to time, the specific terms of which Securities, including,
without limitation, the rate or rates of interest or formula for determining the
rate or rates of interest thereon, if any, the Stated Maturity or Stated
Maturities thereof, the original issue date or dates thereof, the redemption
provisions, if any, with respect thereto, and any other terms specified as
contemplated by Section 3.1 with respect thereto, are to be determined by the
Company upon the issuance of such Securities.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Payment", when used with respect to the Securities
of or within any series, means the place or places where, subject to the
provisions of Section 9.2, the principal of, premium, if any, and interest, if
any, on such Securities are payable as specified by Section 3.1.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.6 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to
be redeemed, in whole or in part, means the price at which it is to be redeemed
pursuant to this Indenture.
7
<PAGE> 15
"Registered Security" means any Security in the form (to the
extent applicable thereto) established pursuant to Section 2.1 that is
registered as to principal and interest in the Register.
"Regular Record Date" for the interest payable on any Interest
Payment Date on the Registered Securities of or within any series means the date
specified for that purpose as contemplated by Section 3.1.
"Responsible Officer", when used with respect to the Trustee,
shall mean any vice president, assistant vice president, any senior trust
officer, or any trust officer, in the Corporate Trust Office of the Trustee or
any other officer of the Trustee customarily performing functions similar to
those performed by the persons who at the time shall be such officers,
respectively, and also means, with respect to a particular corporate trust
matter, any other officer of the Trustee to whom such corporate trust matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Security" or "Securities" has the meaning stated in the first
recital of this Indenture and more particularly means any Security or Securities
of the Company issued, authenticated and delivered under this Indenture.
"Special Record Date" for the payment of any Defaulted
Interest on the Registered Securities of any issue means a date fixed by the
Trustee pursuant to Section 3.7.
"Stated Maturity", when used with respect to any Security or
any installment of principal thereof or interest thereon, means the date
specified in such Security or in a coupon representing such installment of
interest as the fixed date on which the principal of such Security or such
installment of principal or interest is due and payable.
"Subsidiary" means any corporation of which the Company at the
time owns or controls, directly or indirectly, more than 50% of the shares of
outstanding stock having general voting power under ordinary circumstances to
elect a majority of the Board of Directors of such corporation (irrespective of
whether or not at the time stock of any other class or classes of such
corporation shall have or might have voting power by reason of the happening of
any contingency).
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended, as in effect on the date of this Indenture, except as provided in
Section 8.3.
"Trustee" means the party named as such in the first paragraph
of this Indenture until a successor Trustee replaces it pursuant to the
applicable provisions of this Indenture, and thereafter means such successor
Trustee and if, at any time, there is more than one Trustee, "Trustee" as used
with respect to the Securities of any series shall mean the Trustee with respect
to the Securities of that series.
8
<PAGE> 16
"United States" means, unless otherwise specified with respect
to the Securities of any series as contemplated by Section 3.1, the United
States of America (including the States and the District of Columbia), its
territories, its possessions and other areas subject to its jurisdiction.
"U.S. Person" means, unless otherwise specified with respect
to the Securities of any series as contemplated by Section 3.1, a citizen,
national or resident of the United States, a corporation, partnership or other
entity created or organized in or under the laws of the United States or any
political subdivision thereof, or an estate or trust the income of which is
subject to United States federal income taxation regardless of its source.
"Yield to Maturity" means the yield to maturity, calculated by
the Company at the time of issuance of a series of Securities or, if applicable,
at the time of the most recent determination of interest on such series, in
accordance with accepted financial practice.
(b) The following terms shall have the meanings specified in
the Sections referred to opposite such term below:
<TABLE>
<CAPTION>
TERM SECTION
- ---- -------
<S> <C>
"Act" 1.4(a)
"Bankruptcy Law" 5.1
"Component Currency" 3.11(h)
"Conversion Date" 3.11(d)
"Custodian" 5.1
"Defaulted Interest" 3.7(b)
"defeasance" 4.4
"Dollar Equivalent of the Foreign 3.11(f)
Currency"
"Dollar Equivalent of the Currency 3.11(g)
Unit"
"Election Date" 3.11(h)
"Event of Default" 5.1
"Register" 3.5
"Registrar" 3.5
"Specified Amount" 3.11(h)
"Valuation Date" 3.11(c)
</TABLE>
Section 1.2. Compliance Certificates and Opinions. Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an
Officer's Certificate stating that all conditions precedent, if any, provided
for in this Indenture relating to the proposed action have been complied with
and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, except that in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.
9
<PAGE> 17
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than pursuant to
Sections 2.3, 3.3 and 9.7) shall include:
(1) a statement that each individual signing such
certificate or opinion has read such condition or covenant and the
definitions herein relating thereto;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such
individual, he has made or caused to be made such examination or
investigation as is necessary to enable him to express an informed
opinion as to whether or not such condition or covenant has been
complied with; and
(4) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied with.
Section 1.3. Form of Documents Delivered to Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations as to such matters are
erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
Section 1.4. Acts of Holders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such Holders
in person or by agent duly appointed in writing. Except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, where it is hereby expressly
required, to the Company. Such instrument
10
<PAGE> 18
or instruments (and the action embodied therein and evidenced thereby) are
herein sometimes referred to as the "Act" of the Holders signing such instrument
or instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and conclusive in favor of the Trustee and the Company, if made in the manner
provided in clause (b) of this Section 1.4. Whenever any action or Act is to be
taken hereunder by the Holders of Securities denominated in different currencies
or currency units, then for purposes of determining the principal amount of
Securities held by such Holders, the aggregate principal amount of the
Securities denominated in a foreign currency or currency unit shall be deemed to
be the Dollar equivalent amounts thereof determined by the Company on the basis
of the applicable Market Exchange Rates in effect as of the date of the taking
of such action or Act by the Holders of the requisite percentage in principal
amount of the Securities (the "Action Date"), except that, if a Conversion Event
has occurred with respect to a Foreign Currency or currency unit and is
continuing, the Dollar equivalent amounts of Securities denominated in such
Foreign Currency or currency unit shall be determined on the basis of the Dollar
Equivalent of the Foreign Currency or the Dollar Equivalent of the Currency Unit
(computed in accordance with Sections 3.11(f) and (g), except that for purposes
of computing the Dollar Equivalent of the Currency Unit, references to the
"Valuation Date" shall be deemed to refer to the date of the taking of such
action or Act by the Holders of the requisite percentage in principal amount of
the Securities).
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other reasonable manner which the Trustee deems sufficient.
(c) The ownership of Bearer Securities may be proved by the
production of such Bearer Securities or by a certificate executed by any trust
company, bank, banker or other depositary, wherever situated, if such
certificate shall be deemed by the Trustee to be satisfactory, showing that at
the date therein mentioned such Person had on deposit with such depositary, or
exhibited to it, the Bearer Securities therein described; or such facts may be
proved by the certificate or affidavit of the Person holding such Bearer
Securities, if such certificate or affidavit is deemed by the Trustee to be
satisfactory. The Trustee and the Company may assume that such ownership of any
bearer Security continues until (i) another such certificate or affidavit
bearing a later date issued in respect of the same Bearer Security is produced,
(ii) such Bearer Security is produced to the Trustee by some other Person, (iii)
such Bearer Security is surrendered in exchange for a Registered Security or
(iv) such Bearer Security is no longer Outstanding. The ownership of Bearer
Securities may also be proved in any other reasonable manner which the Trustee
deems sufficient.
(d) The ownership of Registered Securities shall be proved by
the Register or by a certificate of the Registrar.
11
<PAGE> 19
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.
(f) If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other Act, the
Company may, at its option, by or pursuant to an Officer's Certificate delivered
to the Trustee, fix in advance a record date for the determination of Holders
entitled to give such request, demand, authorization, direction, notice,
consent, waiver or other Act, but the Company shall have no obligation to do so.
If such a record date is fixed, such request, demand, authorization, direction,
notice, consent, waiver or other Act may be given before or after such record
date, but only the Holders of record at the close of business on such record
date shall be deemed to be Holders for the purposes of determining whether
Holders of the requisite proportion of Outstanding Securities have authorized or
agreed or consented to such request, demand, authorization, direction, notice,
consent, waiver or other Act, and for that purpose the Outstanding Securities
shall be computed as of such record date; provided, however, that no such
authorization, agreement or consent by the Holders on such record date shall be
deemed effective unless it shall become effective pursuant to the provisions of
clause (a) of this Section 1.4 no later than six months after the record date.
(g) At any time prior to (but not after) the evidencing to the
Trustee, as provided in clause (a) of this Section 1.4, of the taking of any Act
by the Holders of the percentage in aggregate principal amount of the
Outstanding Securities specified in this Indenture in connection with such Act,
any Holder of a Security, the number, letter or other distinguishing symbol of
which is shown by the evidence to be included in the Securities the Holders of
which have consented to such Act, may, by filing written notice with the Trustee
at the Corporate Trust Office and upon proof of ownership as provided in this
Section 1.4, revoke such Holder's consent to such Act so far as it concerns such
Security.
(h) The Trustee may in any instance require further proof with
respect to any of the matters referred to in this Section 1.4 so long as this
request is a reasonable one.
Section 1.5. Notices, etc., to Trustee and Company. Any
request, demand, authorization, direction, notice, consent, waiver or Act of
Holders or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with
(1) the Trustee by any Holder or by the Company shall
be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office,
Attention: Corporate Trust Department, or
(2) the Company by the Trustee or by any Holder shall
be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to it at 1600 Smith, Houston,
12
<PAGE> 20
Texas 77002, Attention: Chief Executive Officer and General Counsel, or
at any other address furnished in writing to the Trustee by the Company
prior to the mailing thereof.
Section 1.6. Notice to Holders; Waiver. Where this Indenture
provides for notice to Holders of any event, (i) if any of the Securities
affected by such event are Registered Securities, such notice to the Holders
thereof shall be sufficiently given (unless otherwise herein expressly provided
or otherwise agreed to by a Holder) if in writing and mailed, first-class
postage prepaid, to each such Holder affected by such event, at his address as
it appears in the Register, within the time prescribed for the giving of such
notice and (ii) if any of the Securities affected by such event are Bearer
Securities, notice to the Holders thereof shall be sufficiently given (unless
otherwise herein or in the terms of such Bearer Securities expressly provided)
if published once in an Authorized Newspaper in New York, New York, and in such
other city or cities, if any, as may be specified as contemplated by Section
3.1(5).
In any case where notice to Holders is given by mail, neither
the failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders of Registered Securities or the sufficiency of any notice to
Holders of Bearer Securities given as provided herein. In any case where notice
is given to Holders by publication, neither the failure to publish such notice,
nor any defect in any notice so published, shall affect the sufficiency of such
notice with respect to other Holders of Bearer Securities or the sufficiency of
any notice to Holders of Registered Securities given as provided herein. Any
notice mailed to a Holder in the manner herein prescribed shall be conclusively
deemed to have been received by such Holder, whether or not such Holder actually
receives such notice.
If by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice as
provided above, then such notification as shall be made with the approval of the
Trustee shall constitute a sufficient notification for every purpose hereunder.
If it is impossible or, in the opinion of the Trustee, impracticable to give any
notice by publication in the manner herein required, then such publication in
lieu thereof as shall be made with the approval of the Trustee shall constitute
a sufficient publication of such notice.
Any request, demand, authorization, direction, notice, consent
or waiver required or permitted under this Indenture shall be in the English
language, except that any published notice may be in an official language of the
country of publication
Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
Section 1.7. Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
13
<PAGE> 21
Section 1.8. Successors and Assigns. All covenants and
agreements in this Indenture by the Company shall bind its successors and
assigns, whether so expressed or not.
Section 1.9. Separability. In case any provision of this
Indenture or the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 1.10. Benefits of Indenture. Nothing in this Indenture
or in the Securities, expressed or implied, shall give to any Person, other than
the parties hereto, any Registrar, any Paying Agent and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
Section 1.11. Governing Law. THIS INDENTURE, THE SECURITIES
AND ANY COUPONS APPERTAINING THERETO SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. This Indenture is subject to
the Trust Indenture Act and if any provision hereof limits, qualifies or
conflicts with the duties imposed on any Person by the provision of Sections 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
Section 1.12. Legal Holidays. Unless otherwise specified
pursuant to Section 3.1 or in any Security, in any case where any Interest
Payment Date, Redemption Date, sinking fund payment date, Stated Maturity or
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or any Security or
coupon other than a provision in the Securities of any series which specifically
states that such provision shall apply in lieu of this Section) payment of
principal, premium, if any, or interest, if any, need not be made at such Place
of Payment on such date, but may be made on the next succeeding Business Day at
such Place of Payment with the same force and effect as if made on such date;
provided, however, that no interest shall accrue on the amount so payable for
the period from and after such Interest Payment Date, Redemption Date, sinking
fund payment date, Stated Maturity or Maturity, as the case may be, to such
Business Day if such payment is made or duly provided for on such Business Day.
Section 1.13. Trustee to Establish Record Dates. The Trustee
shall fix a record date for the purpose of determining the Holders entitled to
make, give or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided in this Indenture to be made, given or
taken by Holders. If such a record date is fixed, the Holders on such record
date and only such Holders, shall be entitled to make, give or take such
request, demand, authorization, direction, notice, consent, waiver or other
action, whether or not such Holders remain Holders after such record date. No
such request, demand, authorization, direction, notice, consent, waiver or other
action shall be valid or effective if made, given or taken more than 90 days
after such record date.
Section 1.14. No Security Interest Created. Nothing in this
Indenture or in the Securities or coupons, if any, express or implied, shall be
construed to constitute a security interest under the Uniform Commercial Code or
similar legislation, as now or hereafter enacted and in effect in any
jurisdiction where property of the Company or its Subsidiaries is or may be
located.
14
<PAGE> 22
Section 1.15. Liability Solely Corporate. No recourse shall be
had for the payment of the principal of (or premium, if any) or the interest on
any Securities or coupons, if any, or any part thereof, or of the indebtedness
represented thereby, or upon any obligation, covenant or agreement of this
Indenture, against any incorporator, or against any stockholder, officer or
director, as such, past, present or future, of the Company (or any incorporator,
stockholder, officer or director of any predecessor or successor corporation),
either directly or through the Company (or any such predecessor or successor
corporation), whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise; it being expressly
agreed and understood that this Indenture and all the Securities and coupons, if
any, are solely corporate obligations, and that no personal liability whatsoever
shall attach to, or be incurred by, any such incorporator, stockholder, officer
or director, past, present or future, of the Company (or any incorporator,
stockholder, officer or director of any such predecessor or successor
corporation), either directly or indirectly through the Company or any such
predecessor or successor corporation, because of the indebtedness hereby
authorized or under or by reason of any of the obligations, covenants, promises
or agreements contained in this Indenture or in any of the Securities or
coupons, if any, or to be implied herefrom or therefrom; and that any such
personal liability is hereby expressly waived and released as a condition of,
and as part of the consideration for, the execution of this Indenture and the
issue of Securities; provided, however, that nothing herein or in the Securities
or coupons, if any, contained shall be taken to prevent recourse to and the
enforcement of the liability, if any, of any stockholder or subscriber to
capital stock upon or in respect of the shares of capital stock not fully paid.
ARTICLE 2
SECURITY FORMS
Section 2.1. Forms Generally. The Securities of each series
and the coupons, if any, to be attached thereto shall be in substantially such
form (including global form) as shall be established by or pursuant to authority
granted in a Board Resolution or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities and coupons, if any, as evidenced by their
execution of the Securities and coupons, if any. If temporary Securities of any
series are issued as permitted by Section 3.4, the form thereof also shall be
established as provided in the preceding sentence. If the forms of Securities
and coupons, if any, of any series are established by or pursuant to a Board
Resolution, such Board Resolution (and, if applicable, an Officer's Certificate
certifying the action taken pursuant to such Board Resolution) shall be
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 3.3 for the authentication and delivery of such
Securities.
Unless otherwise specified as contemplated by Section 3.1,
Bearer Securities shall have interest coupons attached.
15
<PAGE> 23
The definitive Securities and coupons, if any, shall be
printed, lithographed or engraved or produced by any combination of these
methods or may be produced in any other manner, all as determined by the
officers executing such Securities and coupons, if any, as evidenced by their
execution of such Securities and coupons, if any.
Section 2.2. Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be in substantially the
following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of a series issued under the
within-mentioned Indenture.
Dated: BANK ONE, N.A., as Trustee
By:
---------------------------------
Authorized Signatory
Section 2.3. Securities in Global Form. If Securities of or
within a series are issuable in whole or in part in temporary or definitive
global form, as specified as contemplated by Section 3.1, then, notwithstanding
clause (8) of Section 3.1(b) and the provisions of Section 3.2, any such
Security shall represent such of the Outstanding Securities of such series as
shall be specified therein and may provide that it shall represent the aggregate
amount of Outstanding Securities from time to time endorsed thereon and that the
aggregate amount of Outstanding Securities represented thereby may from time to
time be reduced to reflect exchanges. Any endorsement of a Security in global
form to reflect the amount, or any increase or decrease in the amount, or
changes in the rights of Holders, of Outstanding Securities represented thereby,
shall be made by the Trustee in such manner and upon instructions given by such
Person or Persons as shall be specified therein or in the Company Order to be
delivered to the Trustee pursuant to Section 3.3 or 3.4. Subject to the
provisions of Section 3.3 and, if applicable, Section 3.4, the Trustee shall
deliver and redeliver any Security in global form in the manner and upon
instructions given by the Person or Persons specified therein or in the
applicable Company Order. Any instructions by the Company with respect to
endorsement or delivery or redelivery of a Security in global form shall be in
writing but need not comply with Section 1.2 hereof and need not be accompanied
by an Opinion of Counsel.
The provisions of the last paragraph of Section 3.3 shall
apply to any Security in global form if such Security was never issued and sold
by the Company and the Company delivers to the Trustee the Security in global
form together with written instructions (which need not comply with Section 1.2
and need not be accompanied by an Opinion of Counsel) with regard to the
reduction in the principal amount of Securities represented thereby, together
with the written statement contemplated by the last paragraph of Section 3.3.
Notwithstanding the provisions of Sections 2.1 and 3.7, unless
otherwise specified as contemplated by Section 3.1, payment of principal of,
premium, if any, and interest, if any, on any Security in definitive global form
shall be made to the Person or Persons specified therein.
16
<PAGE> 24
ARTICLE 3
THE SECURITIES
Section 3.1. Amount Unlimited; Issuable in Series. (a) The
aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited. The Securities may be issued from
time to time in one or more series.
(b) The following matters shall be established and (subject to
Section 3.3) set forth, or determined in the manner provided, in a Board
Resolution, and, in the case of matters established or determined pursuant to a
Board Resolution, set forth in an Officer's Certificate certifying the action
taken pursuant to such Board Resolution, or one or more indentures supplemental
hereto:
(1) the title of the Securities of the series (which
title shall distinguish the Securities of the series from all other
Securities);
(2) any limit upon the aggregate principal amount of
the Securities of the series which may be authenticated and delivered
under this Indenture (which limit shall not pertain to (i) Securities
authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Securities of the series pursuant to
Section 3.4, 3.5, 3.6, 8.6 or 10.7 and (ii) any Securities that,
pursuant to the last paragraph of Section 3.3, are deemed never to have
been authenticated and delivered hereunder);
(3) the date or dates on which or periods during
which the Securities of the series may be issued, and the date or dates
(or the method of determination thereof) on which the principal of (and
premium, if any, on) the Securities of such series are or may be
payable (which, if so provided in or pursuant to such Board Resolution
or supplemental indenture, may be determined by the Company from time
to time and set forth in the Securities of the series issued from time
to time);
(4) the rate or rates at which the Securities of the
series shall bear interest, if any, or the method of calculating such
rate or rates of interest, the date or dates from which such interest
shall accrue (which, if so provided in or pursuant to such Board
Resolution or supplemental indenture, may be determined by the Company
from time to time and set forth in the Securities of the series issued
from time to time) or the method by which such date or dates shall be
determined, the Interest Payment Dates on which any such interest shall
be payable (or the method of determination thereof) and, with respect
to Registered Securities, the Regular Record Date, if any, for the
interest payable on any Registered Security on any Interest Payment
Date;
(5) the place or places where, subject to the
provisions of Section 9.2, the principal of, premium, if any, and
interest, if any, on Securities of the series shall be payable; the
extent to which, or the manner in which, any interest payable on any
Security in global form on an Interest Payment Date will be paid, if
other than in the manner provided in
17
<PAGE> 25
Section 3.7; and the manner in which any principal of, or premium, if
any, on, any Security in global form will be paid, if other than as set
forth elsewhere herein;
(6) the period or periods within which, or the date
or dates on which, the price or prices at which, the currency or
currencies (including currency units) in which, and the other terms and
conditions upon which, Securities of the series may be redeemed, in
whole or in part, at the option of the Company and, if other than as
provided in Section 10.3, the manner in which the particular Securities
of such series (if less than all Securities of such series are to be
redeemed) are to be selected for redemption;
(7) the obligation, if any, of the Company to redeem
or repurchase Securities of the series pursuant to any sinking fund or
analogous provisions or upon the happening of a specified event or at
the option of a Holder thereof and the period or periods within which,
the price or prices at which, and the other terms and conditions upon
which, Securities of the series shall be redeemed or repurchased, in
whole or in part, pursuant to such obligation;
(8) if other than denominations of $1,000 and any
integral multiple thereof, if Registered Securities, and if other than
denominations of $5,000, if Bearer Securities, the denominations in
which Securities of the series shall be issuable;
(9) if other than Dollars, the currency or currencies
(including currency units) in which the principal of, premium, if any,
and interest, if any, on the Securities of the series shall be payable,
or in which the Securities of the series shall be denominated, the
particular provisions applicable thereto in accordance with, in
addition to, or in lieu of the provisions of Section 3.11, and whether
the Securities of the series may be satisfied and discharged other than
as provided in Article 4;
(10) if the payments of principal of, premium, if
any, or interest, if any, on the Securities of the series are to be
made, at the election of the Company or a Holder, in a currency or
currencies (including currency units) other than that in which such
Securities are denominated or designated to be payable, the currency or
currencies (including currency units) in which such payments are to be
made, the terms and conditions of such payments and the manner in which
the exchange rate with respect to such payments shall be determined,
the particular provisions applicable thereto in accordance with, in
addition to, or in lieu of the provisions of Section 3.11, and whether
the Securities of the series may be satisfied and discharged other than
as provided in Article 4;
(11) if the amount of payments of principal of,
premium, if any, and interest, if any, on the Securities of the series
shall be determined with reference to an index, formula or other method
(which index, formula or method may be based, without limitation, on a
currency or currencies (including currency units) other than that in
which the Securities of the series are denominated or designated to be
payable), the index, formula or other method by which such amounts
shall be determined;
18
<PAGE> 26
(12) if other than the principal amount thereof, the
portion of the principal amount of such Securities of the series that
shall be payable upon declaration of acceleration of the Maturity
thereof pursuant to Section 5.2 or the method by which such portion
shall be determined;
(13) if other than as provided in Section 3.7, the
Person to whom any interest on any Registered Security of the series
shall be payable, the manner in which, or the Person to whom, any
interest on any Bearer Securities of the series shall be payable, and
the extent to which, or the manner in which (including any
certification requirement and other terms and conditions under which),
any interest payable on a temporary or definitive global Security on an
Interest Payment Date will be paid if other than in the manner provided
in Section 2.3 and Section 3.4, as applicable;
(14) provisions, if any, granting special rights to
Holders of Securities of the series upon the occurrence of such events
as may be specified;
(15) any deletions from, modifications of or
additions to the Events of Default set forth in Section 5.1 or
covenants of the Company set forth in Article 9 pertaining to the
Securities of the series;
(16) the circumstances, if any, under which the
Company will pay additional amounts on the Securities of that series
held by a Person who is not a U.S. Person in respect of taxes or
similar charges withheld or deducted and, if so, whether the Company
will have the option to redeem such Securities rather than pay such
additional amounts (and the terms of any such option);
(17) whether Securities of the series shall be
issuable as Registered Securities or Bearer Securities (with or without
interest coupons), or both, and any restrictions applicable to the
offering, sale or delivery of Bearer Securities and, if other than as
provided in Section 3.5, the terms upon which Bearer Securities of a
series may be exchanged for Registered Securities of the same series
and vice versa;
(18) the date as of which any Bearer Securities of
the series and any temporary global Security representing Outstanding
Securities of the series shall be dated if other than the date of
original issuance of the first Security of the series to be issued;
(19) the applicability, if any, to the Securities of
or within the series of Sections 4.4 and 4.5, or such other means of
payment defeasance or covenant defeasance as may be specified for the
Securities and coupons, if any, of such series, and whether, for the
purpose of such payment defeasance or covenant defeasance, the term
"Government Obligations" shall include obligations referred to in the
definition of such term that are not obligations of the United States
or an agency or instrumentality of the United States;
(20) if other than the Trustee, the identity of the
Registrar and any Paying Agent;
19
<PAGE> 27
(21) the designation of the initial Exchange Rate
Agent, if any;
(22) whether Securities of the series shall be issued
in whole or in part in temporary or definitive global form and, if so,
(i) the initial Depositary for such global Securities (which Depositary
shall have the qualifications set forth in Section 3.3) and (ii) if
other than as provided in Section 3.4 or 3.5, as applicable, whether
and the circumstances under which beneficial owners of interests in any
Securities of the series in temporary or definitive global form may
exchange such interests for Securities of such series and of like tenor
of any authorized form and denomination;
(23) if Bearer Securities of the series are to be
issued, (x) whether interest in respect of any portion of a temporary
Security in global form (representing all of the Outstanding Bearer
Securities of the series) payable in respect of any Interest Payment
Date prior to the exchange of such temporary Security for definitive
Securities of the series shall be paid to any clearing organization
with respect to the portion of such temporary Security held for its
account and, in such event, the terms and conditions (including any
certification requirements) upon which any such interest payment
received by a clearing organization will be credited to the Persons
entitled to interest payable on such Interest Payment Date, and (y) the
terms upon which interests in such temporary Security in global form
may be exchanged for interests in a definitive Security in global form
or for definitive Securities of the series and the terms upon which
interests in a definitive Security in global form, if any, may be
exchanged for definitive Securities of the series; and
(24) any other terms of the series (which terms shall
not be inconsistent with the provisions of this Indenture), including
any terms that may be required by or advisable under United States laws
or regulations or advisable in connection with the marketing of
Securities of the series.
(c) All Securities of any one series and coupons, if any,
appertaining to any Bearer Securities of such series shall be substantially
identical except as to denomination, the terms of redemption and the rate or
rates of interest (or method of determining the rate of interest), if any, and
Stated Maturity, the date from which interest, if any, shall accrue and except
as may otherwise be provided, or determined pursuant to the authority granted,
in a Board Resolution pursuant to this Section 3.1 or in an indenture
supplemental hereto. All Securities of any one series need not be issued at the
same time and, unless otherwise provided, a series may be reopened, without the
consent of the Holders, for issuances of additional Securities of such series or
for the establishment of additional terms with respect to the Securities of such
series.
(d) If any of the terms of the Securities of any series are
established by action taken pursuant to a Board Resolution, a copy of such Board
Resolution shall be delivered to the Trustee at or prior to the delivery of the
Officer's Certificate of the Company, setting forth, or providing the manner for
determining, the terms of the Securities of such series, and an appropriate
record of any action taken pursuant thereto in connection with the issuance of
any Securities of such series shall be delivered to the Trustee prior to the
authentication and delivery thereof. With respect to Securities of a series
subject to a Periodic Offering, such Board Resolutions and Officer's
20
<PAGE> 28
Certificates may provide general terms for Securities of such series and provide
either that the specific terms of particular Securities of such series shall be
specified in a Company Order, or that such terms shall be determined by the
Company, or one or more of its agents, designated in its Officer's Certificate
or Board Resolution, in accordance with the Company Order, as contemplated by
the first proviso of the third paragraph of Section 3.3.
Section 3.2. Denominations. Unless otherwise provided as
contemplated by Section 3.1, any Registered Securities of a series shall be
issuable in denominations of $1,000 and any integral multiple thereof and any
Bearer Securities of a series shall be issuable in denominations of $5,000.
Section 3.3. Execution, Authentication, Delivery and Dating.
Securities shall be executed on behalf of the Company by its Chairman of the
Board or President and attested to by its Secretary or one of its Assistant
Secretaries. The Company's seal shall be affixed to the Securities, or a
facsimile of such seal shall be engraved, printed, or otherwise reproduced on
the Securities. The signatures of such officers on the Securities may be manual
or facsimile. The coupons, if any, of Bearer Securities shall bear the facsimile
signature of the Chairman of the Board or President and shall be attested by the
Secretary of the Company.
Securities and coupons bearing the manual or facsimile
signatures of individuals who were at any time proper officers of the Company
shall bind the Company, notwithstanding that such individuals or any of them
have ceased to hold such offices prior to the authentication and delivery of
such Securities or did not hold such offices at the date of such Securities.
At any time and from time to time, the Company may deliver
Securities, together with any coupons appertaining thereto, of any series
executed by the Company to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Securities, and the
Trustee in accordance with the Company Order shall authenticate and deliver such
Securities; provided, however, that in the case of Securities offered in a
Periodic Offering, the Trustee shall authenticate and deliver such Securities
from time to time in accordance with such other procedures (including, without
limitation, the receipt by the Trustee of oral or electronic instructions from
the Company or its duly authorized agents, promptly confirmed in writing)
acceptable to the Trustee as may be specified by or pursuant to a Company Order
delivered to the Trustee prior to the time of the first authentication of
Securities of such series; provided, further, that, in connection with its sale
during the "restricted period" (as defined in Section 1.163- 5(c)(2)(i)(D)(7) of
the United States Treasury Regulations), no Bearer Security shall be mailed or
otherwise delivered to any location in the United States. If any Security shall
be represented by a definitive Security in global form, then, for purposes of
this Section and Section 3.4, the notation of a beneficial owner's interest
therein upon original issuance of such Security or upon exchange of a portion of
a temporary Security in global form shall be deemed to be delivery in connection
with the original issuance of such beneficial owner's interest in such
definitive Security in global form. Except as permitted by Section 3.6 or 3.7,
the Trustee shall not authenticate and deliver any Bearer Security unless all
coupons, if any, for interest then matured have been detached and canceled.
21
<PAGE> 29
If the form or terms of the Securities of a series have been
established by or pursuant to one or more Board Resolutions or Officer's
Certificates as permitted by Sections 2.1 and 3.1, in authenticating such
Securities and accepting the additional responsibilities under this Indenture in
relation to such Securities, the Trustee shall be entitled to receive, and
(subject to Section 315(a) through (d) of the Trust Indenture Act) shall be
fully protected in relying upon, an Opinion of Counsel stating,
(1) all instruments furnished by the Company to the
Trustee in connection with the authentication and delivery of such
Securities and coupons conform to the requirements of this Indenture
and constitute sufficient authority hereunder for the Trustee to
authenticate and deliver such Securities and coupons;
(2) that the forms and terms of such Securities and
any coupons have been established in conformity with the provisions of
this Indenture;
(3) the execution and delivery of such Securities and
coupons have been duly authorized by all necessary corporate action of
the Company and such Securities and coupons have been duly executed by
the Company, and that such Securities together with any coupons
appertaining thereto, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute valid and legally
binding obligations of the Company, enforceable in accordance with
their terms, subject to applicable bankruptcy, insolvency and similar
laws affecting creditors' rights generally and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law) and subject
to other customary exceptions;
(4) if the forms or terms of such Securities and
coupons have been established in a supplemental indenture, the
execution and delivery of such supplemental indenture has been duly
authorized by all necessary corporate action of the Company, such
supplemental indenture has been duly executed and delivered by the
Company and, assuming due authorization, execution and delivery by the
Trustee, is a valid and binding obligation enforceable against the
Company in accordance with its terms, subject to applicable bankruptcy,
insolvency and similar laws affecting creditors' rights generally and
subject, as to enforceability, to general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity
or at law) and subject to other customary exceptions; and
(5) the amount of Securities Outstanding of such
series, together with the amount of such Securities, does not exceed
any limit established under the terms of this Indenture on the amount
of Securities of such series that may be authenticated and delivered;
provided, however, that, with respect to Securities of a series subject to a
Periodic Offering, the Trustee shall be entitled to receive such Opinion of
Counsel only once at or prior to the time of the first authentication of
Securities of such series and that the Opinion of Counsel above may state:
22
<PAGE> 30
(x) that the forms of such Securities have been, and
the terms of such Securities (when established by or in accordance with
such procedures as may be specified from time to time in a Company
Order, all as contemplated by and in accordance with a Board Resolution
or an Officer's Certificate pursuant to Section 3.1, as the case may
be) will have been, established in conformity with the provisions of
this Indenture; and
(y) that such Securities, together with the coupons,
if any, appertaining thereto, when (1) executed by the Company, (2)
completed, authenticated and delivered by the Trustee in accordance
with this Indenture, and (3) issued by the Company in the manner and
subject to any conditions specified in such Opinion of Counsel, will
constitute valid and legally binding obligations of the Company,
enforceable in accordance with their terms, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights
generally and subject, as to enforceability, to general principles of
equity (regardless of whether enforcement is sought in a proceeding in
equity or at law) and subject to other customary exceptions.
With respect to Securities of a series subject to a Periodic
Offering, the Trustee may conclusively rely, as to the authorization by the
Company of any of such Securities, the form and terms thereof and the legality,
validity, binding effect and enforceability thereof, upon the Opinion of Counsel
and other documents delivered pursuant to Sections 2.1 and 3.1 and this Section,
as applicable, at or prior to the time of the first authentication of Securities
of such series unless and until it has received written notification that such
opinion or other documents have been superseded or revoked. In connection with
the authentication and delivery of Securities of a series subject to a Periodic
Offering, the Trustee shall be entitled to assume that the Company's
instructions to authenticate and deliver such Securities do not violate any
rules, regulations or orders of any governmental agency or commission having
jurisdiction over the Company.
If the form or terms of the Securities of a series have been
established by or pursuant to one or more Officer's Certificates as permitted by
Sections 2.1 and 3.1, the Trustee shall have the right to decline to
authenticate such Securities if the issue of such Securities pursuant to this
Indenture will adversely affect the Trustee's own rights, duties or immunities
under this Indenture or otherwise in a manner that is not reasonably acceptable
to the Trustee. Notwithstanding the generality of the foregoing, the Trustee
shall not be required to authenticate Securities denominated in a Foreign
Currency if the Trustee reasonably believes that it would be unable to perform
its duties with respect to such Securities.
Notwithstanding the provisions of Section 3.1 and of the two
preceding paragraphs, if all of the Securities of any series are not to be
issued at one time, it shall not be necessary to deliver the Officer's
Certificate otherwise required pursuant to Section 3.1 at or prior to the time
of the authentication of each Security of such series if such Officer's
Certificate is delivered at or prior to the authentication upon original
issuance of the first Security of such series to be issued.
If the Company shall establish pursuant to Section 3.1 that
the Securities of a series are to be issued in whole or in part in global form,
then the Company shall execute and the Trustee shall, in accordance with this
Section and the Company Order with respect to such series,
23
<PAGE> 31
authenticate and deliver one or more Securities in global form that (i) shall
represent and shall be denominated in an amount equal to the aggregate principal
amount of the Outstanding Securities of such series to be represented by such
Security or Securities in global form, (ii) shall be registered, if a Registered
Security, in the name of the Depositary for such Security or Securities in
global form or the nominee of such Depositary and (iii) shall be delivered by
the Trustee to such Depositary or pursuant to such Depositary's instruction.
Each Depositary designated pursuant to Section 3.1 for a
Registered Security in global form must, at the time of designation and at all
times while it serves as Depositary, be a clearing agency registered under the
Securities Exchange Act of 1934 and any other applicable statute or regulation.
The Trustee shall have no responsibility to determine if the Depositary is so
registered. Each Depositary shall enter into an agreement with the Trustee
governing the respective duties and rights of such Depositary and the Trustee
with regard to Securities issued in global form.
Each Registered Security shall be dated the date of its
authentication and each Bearer Security (including a Bearer Security represented
by a temporary global Security) shall be dated as of the date specified as
contemplated by Section 3.1.
No Security or coupon appertaining thereto shall be entitled
to any benefits under this Indenture or be valid or obligatory for any purpose
until such Security is authenticated by the manual signature of one of the
authorized signatories of the Trustee or an Authenticating Agent. Such signature
upon any Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered under this Indenture and is
entitled to the benefits of this Indenture. Except as permitted by Section 3.6
or 3.7, the Trustee shall not authenticate and deliver any Bearer Security
unless all appurtenant coupons for interest, if any, then matured have been
detached and canceled.
Notwithstanding the foregoing, if any Security shall have been
authenticated and delivered hereunder but never issued and sold by the Company,
and the Company shall deliver such Security to the Trustee for cancellation as
provided in Section 3.9 together with a written statement (which need not comply
with Section 1.2 and need not be accompanied by an Opinion of Counsel) stating
that such Security has never been issued and sold by the Company, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall not be entitled to the benefits
of this Indenture.
Section 3.4. Temporary Securities. Pending the preparation of
definitive Securities of any series, the Company may execute and, upon Company
Order, the Trustee shall authenticate and deliver temporary Securities of such
series that are printed, lithographed, typewritten, mimeographed or otherwise
produced, in any authorized denomination, substantially of the tenor and form,
with or without coupons, of the definitive Securities in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Securities may determine, as
conclusively evidenced by their execution of such Securities and coupons, if
any. In the case of Securities of any series, such temporary Securities may be
in a global form.
24
<PAGE> 32
Except in the case of temporary Securities in global form,
each of which shall be exchanged in accordance with the provisions thereof, if
temporary Securities of any series are issued, the Company shall cause
definitive Securities of such series to be prepared without unreasonable delay.
After preparation of such definitive Securities, the temporary Securities shall
be exchangeable for such definitive Securities of like tenor upon surrender of
the temporary Securities of such series at the office or agency of the Company
maintained pursuant to Section 9.2 in a Place of Payment for such series,
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities of any series (accompanied by any unmatured coupons
appertaining thereto), the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of the same series of authorized denominations and of like
tenor; provided, however, that no definitive Bearer Security shall be delivered
in exchange for a temporary Registered Security; and provided, further that no
definitive Bearer Security shall be delivered in exchange for a temporary Bearer
Security unless the Trustee shall have received from the Person entitled to
receive the definitive Bearer Security a certificate substantially in the form
approved in the Board Resolution or Officer's Certificate relating thereto and
such deliver shall occur only outside the United States. Until so exchanged, the
temporary Securities of any series shall in all respects be entitled to the same
benefits under this Indenture as definitive Securities of such series except as
otherwise specified as contemplated by Section 3.1.
Section 3.5. Registration, Registration of Transfer and
Exchange. (a) The Company shall cause to be kept at the Corporate Trust Office
of the Trustee or in any office or agency to be maintained by the Company in
accordance with Section 9.2 in a Place of Payment a register (the "Register") in
which, subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of Registered Securities and the registration
of transfers of Registered Securities. The Register shall be in written form or
any other form capable of being converted into written form within a reasonable
time. The Trustee is hereby appointed the initial "Registrar" for the purpose of
registering Registered Securities and transfers of Registered Securities as
herein provided.
Upon surrender for registration of transfer of any Registered
Security of any series at the office or agency maintained pursuant to Section
9.2 in a Place of Payment for that series, the Company shall execute, and the
Trustee shall authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Registered Securities of the same series, of any
authorized denominations, of a like aggregate principal amount and tenor and
with like terms and conditions.
Bearer Securities or any coupons appertaining thereto shall be
transferable by delivery.
At the option of the Holder, Registered Securities of any
series (except a Registered Security in global form) may be exchanged for other
Registered Securities of the same series, of any authorized denominations and of
a like aggregate principal amount containing identical terms and provisions,
upon surrender of the Registered Securities to be exchanged at such office or
agency. Whenever any Registered Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the
Registered Securities which the Holder making
25
<PAGE> 33
the exchange is entitled to receive. Unless otherwise specified as contemplated
by Section 3.1, Bearer Securities may not be issued in exchange for Registered
Securities.
(b) Unless otherwise specified as contemplated by Section 3.1,
to the extent permitted by law, at the option of the Holder, Bearer Securities
of a series may be exchanged for Registered Securities (if the Securities of
such series are issuable in registered form) or Bearer Securities (if Bearer
Securities of such series are issuable in more than one denomination and such
changes are permitted by such series) of the same series, of any authorized
denominations and of like tenor and aggregate principal amount, upon surrender
of the Bearer Securities to be exchanged at any such office or agency, with all
unmatured coupons and all matured coupons in default thereto appertaining. If
the Holder of a Bearer Security is unable to produce any such unmatured coupon
or coupons or matured coupon or coupons in default, such exchange may be
effected if the Bearer Securities are accompanied by payment in funds acceptable
to the Company and the Trustee in an amount equal to the face amount of such
missing coupon or coupons, or the surrender of such missing coupon or coupons
may be waived by the Company and the Trustee if there be furnished to them such
security or indemnity as they may require to save each of them and any Paying
Agent harmless. If thereafter the Holder of such Security shall surrender to any
Paying Agent any such missing coupon in respect of which such a payment shall
have been made, such Holder shall be entitled to receive the amount of such
payment; provided, however, that, except as otherwise provided in Section 9.2,
interest represented by coupons shall be payable only upon presentation and
surrender of those coupons at an office or agency located outside the United
States. Notwithstanding the foregoing, in case any Bearer Security of any series
is surrendered at any such office or agency in exchange for a Registered
Security of the same series after the close of business at such office or agency
on (i) any Regular Record Date and before the opening of business at such office
or agency on the relevant Interest Payment Date, or (ii) any Special Record Date
and before the opening of business at such office or agency on the related date
for payment of Defaulted Interest, such Bearer Security shall be surrendered
without the coupon relating to such Interest Payment Date or proposed date of
payment, as the case may be (or, if such coupon is so surrendered with such
Bearer Security, such coupon shall be returned to the Person so surrendering the
Bearer Security), and interest or Defaulted Interest, as the case may be, shall
not be payable on such Interest Payment Date or proposed date for payment, as
the case may be, in respect of the Registered Security issued in exchange for
such Bearer Security, but shall be payable only to the Holder of such coupon,
when due in accordance with the provisions of this Indenture. The Company shall
execute, and the Trustee shall authenticate and deliver, the Registered Security
or Securities that the Holder making the exchange is entitled to receive.
Notwithstanding the foregoing, the exchange of Bearer
Securities for Registered Securities will be subject to the provisions of United
States income tax laws and regulations applicable to Securities in effect at the
time of such exchange.
(c) Except as otherwise specified pursuant to Section 3.1, in
no event may Registered Securities, including Registered Securities received in
exchange for Bearer Securities, be exchanged for Bearer Securities.
26
<PAGE> 34
(d) If the Company shall establish pursuant to Section 3.1
that the Registered Securities of a series are to be issued in whole or in part
in the form of one or more Securities in global form, then the Company shall
execute and the Trustee shall, in accordance with Section 3.3 and the Company
Order with respect to such series, authenticate and deliver one or more
Securities in global form in temporary or definitive form that (i) shall
represent and shall be denominated in an amount equal to the aggregate principal
amount of the Outstanding Securities of such series to be represented by one or
more Securities in global form, (ii) shall be registered in the name of the
Depositary for such Security or Securities in global form or the nominee of such
Depositary, and (iii) shall bear a legend substantially to the following effect:
"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 and until
this Security is exchanged in whole or in part for Securities in definitive
form."
Notwithstanding any other provision (other than the provisions
set forth in the seventh and eighth paragraphs of this Section) of this Section,
unless and until it is exchanged in whole or in part for Securities in
certificated form, a Security in global form representing all or a portion of
the Securities of a series may not be transferred except as a whole by the
Depositary for such series to a nominee of such Depositary or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or by
such Depositary or any such nominee to a successor Depositary for such series or
a nominee of such successor Depositary.
If at any time the Depositary for the Securities of a series
notifies the Company that it is unwilling or unable to continue as Depositary
for the Securities of such series or if at any time the Depositary for the
Securities of such series shall no longer be eligible under Section 3.3, the
Company shall appoint a successor Depositary with respect to the Securities of
such series. If a successor Depositary for the Securities of such series is not
appointed by the Company within 90 days after the issuer receives such notice or
becomes aware of such ineligibility, the Company's election pursuant to Section
3.1 shall no longer be effective with respect to the Securities of such series
and the Company shall execute, and the Trustee, upon receipt of a Company Order
for the authentication and delivery of certificated Securities of such series of
like tenor, shall authenticate and deliver Securities of such series of like
tenor in certificated form, in authorized denominations and in an aggregate
principal amount equal to the principal amount of the Security or Securities of
such series of like tenor in global form in exchange for such Security or
Securities in global form.
The Company may at any time in its sole discretion determine
that Securities of a series issued in global form shall no longer be represented
by such a Security or Securities in global form. In such event, the Company
shall execute, and the Trustee, upon receipt of a Company Order for the
authentication and delivery of certificated Securities of such series of like
tenor, shall authenticate and deliver, Securities of such series of like tenor
in certificated form, in authorized denominations and in an aggregate principal
amount equal to the principal amount of the Security or Securities of such
series of like tenor in global form in exchange for such Security or Securities
in global form.
27
<PAGE> 35
If specified by the Company pursuant to Section 3.1 with
respect to a series of Securities, the Depositary for such series may surrender
a Security in global form of such series in exchange in whole or in part for
Securities of such series in certificated form on such terms as are acceptable
to the Company and such Depositary. Thereupon, the Company shall execute, and
the Trustee shall authenticate and deliver, without service charge:
(i) to each Person specified by such Depositary a new
certificated Security or Securities of the same series of like tenor,
of any authorized denomination as requested by such Person in aggregate
principal amount equal to and in exchange for such Person's beneficial
interest in the Security in global form; and
(ii) to such Depositary a new Security in global form
of like tenor in a denomination equal to the difference, if any,
between the principal amount of the surrendered Security in global form
and the aggregate principal amount of certificated Securities delivered
to Holders thereof.
Upon the exchange of a Security in global form for Securities
in certificated form, such Security in global form shall be canceled by the
Trustee. Unless expressly provided with respect to the Securities of any series
that such Security may be exchanged for Bearer Securities, Securities in
certificated form issued in exchange for a Security in global form pursuant to
this Section shall be registered in such names and in such authorized
denominations as the Depositary for such Security in global form, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall deliver such Securities to the Persons
in whose names such Securities are so registered.
Whenever any Securities are surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or
upon any exchange of Securities shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Securities surrendered upon such registration of transfer or
exchange.
Every Registered Security presented or surrendered for
registration of transfer or for exchange shall (if so required by the Company,
the Registrar or the Trustee) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to those of the Company, the
Registrar and the Trustee requiring such written instrument of transfer duly
executed by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or for any exchange of Securities, but the Company may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of
Securities, other than exchanges pursuant to Section 3.4 or 10.7 not involving
any transfer.
28
<PAGE> 36
The Company shall not be required (i) to issue, register the
transfer of, or exchange any Securities of any particular series and tenor for a
period beginning at the opening of business 15 days before any selection for
redemption of Securities of such series and of like tenor and ending at the
close of business on the earliest date on which the relevant notice of
redemption is deemed to have been given to all Holders of Securities of like
tenor and of such series to be redeemed; (ii) to register the transfer of or
exchange any Registered Security so selected for redemption, in whole or in
part, except the unredeemed portion of any Security being redeemed in part; or
(iii) to exchange any Bearer Security so selected for redemption, except that
such a Bearer Security may be exchanged for a Registered Security of that series
and like tenor; provided, however, that such Registered Security shall be
simultaneously surrendered for redemption.
Section 3.6. Replacement Securities. If a mutilated Security
or a Security with a mutilated coupon appertaining to it is surrendered to the
Trustee, together with, in proper cases, such security or indemnity as may be
required by the Company or the Trustee to save each of them harmless, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a replacement Registered Security, if such surrendered Security was a
Registered Security, or a replacement Bearer Security with coupons corresponding
to the coupons appertaining to the surrendered Security, if such surrendered
Security was a Bearer Security, of the same series, principal amount and Stated
Maturity, containing identical terms and provisions and bearing a number not
contemporaneously Outstanding if the Trustee's requirements are met.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
or Security with a destroyed, lost or stolen coupon, and (ii) such security or
indemnity as may be required by them to save each of them and any agent of
either of them harmless, then in the absence of notice to the Company or the
Trustee that such Security or coupon has been acquired by a bona fide purchaser,
the Company shall execute and the Trustee shall authenticate and deliver in lieu
of any such destroyed, lost or stolen Security or in exchange for the Security
to which a destroyed, lost or stolen coupon appertains (with all appurtenant
coupons not destroyed, lost or stolen), a replacement Registered Security if
such Holder's claim appertains to a Registered Security, or a replacement Bearer
Security with coupons corresponding to the coupons appertaining to the
destroyed, lost or stolen Bearer Security or the Bearer Security to which such
lost, destroyed or stolen coupon appertains, if such Holder's claim appertains
to a Bearer Security, of the same series, principal amount and Stated Maturity,
containing identical terms and provisions and bearing a number not
contemporaneously Outstanding, if the Trustee's requirements are met.
In case any such mutilated, destroyed, lost or stolen Security
or coupon has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Security or coupon, pay such Security
or coupon; provided, however, that payment of principal of and any premium or
interest on Bearer Securities shall, except as otherwise provided in Section
9.2, be payable only at an office or agency located outside the United States
and, unless otherwise specified as contemplated by Section 3.1, any interest on
Bearer Securities shall be payable only upon presentation and surrender of the
coupons appertaining thereto.
29
<PAGE> 37
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series with its coupons, if any,
issued pursuant to this Section in lieu of any destroyed, lost or stolen
Security, or in exchange for a Security to which a destroyed, lost or stolen
coupon appertains, shall constitute an original additional contractual
obligation of the Company, whether or not the destroyed, lost or stolen Security
and its coupon, if any, or the destroyed, lost or stolen coupon, shall be at any
time enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Securities of such
series and their coupons, if any, duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities or
coupons.
Section 3.7. Payment of Interest; Interest Rights Preserved.
(a) Unless otherwise provided as contemplated by Section 3.1, interest, if any,
on any Registered Security that 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 registered at the
close of business on the Regular Record Date for such interest at the office or
agency maintained for such purpose pursuant to Section 9.2; provided, however,
that, at the option of the Company, interest on any series of Registered
Securities that bear interest may be paid (i) by check mailed to the address of
the Person entitled thereto as it shall appear on the Register of Holders of
Securities of such series or (ii) to the extent specified as contemplated by
Section 3.1, by wire transfer to an account maintained by the Person entitled
thereto as specified in the Register of Holders of Securities of such series.
Unless otherwise provided as contemplated by Section 3.1, (i)
interest, if any, on Bearer Securities shall be paid only against presentation
and surrender of the coupons for such interest installments as are evidenced
thereby as they mature and (ii) original issue discount, if any, on Bearer
Securities shall be paid only against presentation and surrender of such
Securities; in either case at the office of a Paying Agent located outside the
United States, unless the Company shall have otherwise instructed the Trustee in
writing; provided that any such instruction for payment in the United States
does not cause any Bearer Security to be treated as a "registration-required
obligation" under the United States law and regulations. The interest, if any,
on any temporary Bearer Security shall be paid, as to any installment of
interest evidenced by a coupon attached thereto, only upon presentation and
surrender of such coupon and, as to other installments of interest, only upon
presentation of such Security for notation thereon of the payment of such
interest. If at the time a payment of principal of or interest, if any, on a
Bearer Security or coupon shall become due, the payment of the full amount so
payable at the office or offices of all the Paying Agents outside the United
States is illegal or effectively precluded because of the imposition of exchange
controls or other similar restrictions on the payment of such amount in Dollars,
then the Company may instruct the Trustee to make such payments at a Paying
Agent located in the United States; provided that
30
<PAGE> 38
provision for such payment in the United States would not cause such Bearer
Security to be treated as a "registration-required obligation" under the United
States law and regulations.
(b) Unless otherwise provided as contemplated by Section 3.1,
any interest on any Registered Security of any series which is payable, but is
not punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company at its election in each case,
as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the Registered
Securities of such series (or their respective Predecessor Securities)
are registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed in the
following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Security
of such series and the date of the proposed payment, and at the same
time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment,
such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest in this clause (1)
provided. Thereupon the Trustee shall fix a Special Record Date for the
payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify the Company in
writing of such Special Record Date and, in the name and at the expense
of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed,
first-class postage prepaid, to each Holder of Registered Securities of
such series at his address as it appears in the 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 so mailed, such Defaulted Interest shall be paid to the
Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of
business on such Special Record Date and shall be no longer payable
pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted
Interest to the Persons in whose names the Registered Securities of
such series (or their respective Predecessor Securities) are registered
at the close of business on a specified date in any other lawful manner
not inconsistent with the requirements of any securities exchange on
which such Securities may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this clause (2), such
manner of payment shall be deemed practicable by the Trustee.
(c) Subject to the foregoing provisions of this Section and
Section 3.5, each Security delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu
31
<PAGE> 39
of any other Security shall carry the rights to interest, if any, accrued and
unpaid, and to accrue, that were carried by such other Security.
(d) Any Defaulted Interest payable in respect of Bearer
Securities of any series shall be payable pursuant to such procedures as may be
satisfactory to the Trustee in such manner that there is no discrimination
between the Holders of Registered Securities (if any) and Bearer Securities of
such series, and notice of the payment date therefor shall be given by the
Trustee, in the name and at the expense of the Company, in the manner provided
in Section 1.6 not more than 25 days and not less than 20 days prior to the date
of the proposed payment.
Section 3.8. Persons Deemed Owners. Prior to and at the time
of due presentment of any Registered Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Registered Security is registered as the owner of such
Registered Security for the purpose of receiving payment of principal of,
premium, if any, and (subject to Section 3.7) interest, if any, on such
Registered Security and for all other purposes whatsoever, whether or not such
Registered Security be overdue, and neither the Company, the Trustee nor any
agent of the Company or the Trustee shall be affected by notice to the contrary.
The Company, the Trustee and any agent of the Company or the
Trustee may treat the bearer of any Bearer Security and the bearer of any coupon
as the absolute owner of such Bearer Security or coupon for the purpose of
receiving payment thereof or on account thereof and for all other purposes
whatsoever, whether or not such Bearer Security or coupon be overdue, and
neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary. All payments made to any Holder, or
upon his order, shall be valid, and, to the extent of the sum or sums paid,
effectual to satisfy and discharge the liability for moneys payable upon such
Security or coupon.
None of the Company, the Trustee or any Agent shall have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of a Security in
global form, or for maintaining, supervising or reviewing any records relating
to such beneficial ownership interests. Notwithstanding the foregoing, with
respect to any Security in global form, nothing herein shall prevent the Company
or the Trustee, or any agent of the Company or the Trustee, from giving effect
to any written certification, proxy or other authorization furnished by any
Depositary (or its nominee), as a Holder, with respect to such Security in
global form or impair, as between such Depositary and Owners of beneficial
interests in such Security in global form, the operation of customary practices
governing the exercise of the rights of such Depositary (or its nominee) as
Holder of such Security in global form.
The Company shall have the right to require a Holder, in
connection with the payment of the principal of, premium, if any, and interest,
if any, on any Security, to certify information to the Company or, in the
absence of such certification, the Company will be entitled to rely on any legal
presumption to enable the Company to determine its duties and liabilities, if
any, to deduct or withhold taxes, assessments or governmental charges for such
payment.
32
<PAGE> 40
Section 3.9. Cancellation. The Company at any time may deliver
to the Trustee for cancellation any Securities or coupons previously
authenticated and delivered hereunder that the Company may have acquired in any
manner whatsoever, and may deliver to the Trustee (or to any other Person for
delivery to the Trustee) for cancellation any Securities or coupons previously
authenticated hereunder which the Company has not issued, and all Securities or
coupons so delivered shall be promptly canceled by the Trustee. The Registrar
and any Paying Agent shall forward to the Trustee any Securities and coupons
surrendered to them for replacement, for registration of transfer, or for
exchange or payment. The Trustee shall cancel all Registered Securities and
matured coupons surrendered for replacement, for registration of transfer, or
for exchange, payment, redemption or cancellation and may dispose of canceled
Securities and coupons and issue a certificate of destruction to the Company.
All Bearer Securities and unmatured coupons so delivered shall be held by the
Trustee and, upon instruction by the Company Order, shall be canceled or held
for reissuance. Bearer Securities and unmatured coupons held for reissuance may
be reissued only in exchange for Bearer Securities of the same series and of
like Stated Maturity and with like terms and conditions pursuant to Section 3.5
or in replacement of mutilated, lost, stolen or destroyed Bearer Securities of
the same series and of like Stated Maturity and with like terms and conditions
or the related coupons pursuant to Section 3.6. All Bearer Securities and
unmatured coupons held by the Trustee pending such cancellation or reissuance
shall be deemed to be delivered for cancellation for all purposes of this
Indenture and the Securities. The Company may not issue new Securities to
replace Securities that it has paid or delivered to the Trustee for
cancellation, except as expressly permitted by the terms of Securities for any
particular series or as permitted pursuant to the terms of this Indenture. All
canceled Securities and coupons held by the Trustee shall be delivered to the
Company upon Company Request. The acquisition of any Securities or coupons by
the Company shall not operate as a redemption or satisfaction of the
indebtedness represented thereby unless and until such Securities or coupons are
surrendered to the Trustee for cancellation. Definitive Securities in global
form shall not be destroyed until exchanged in full for definitive Securities in
certificated form or until payment thereon is made in full.
Section 3.10. Computation of Interest. Except as otherwise
specified as contemplated by Section 3.1, (i) interest on any Securities that
bear interest at a fixed rate shall be computed on the basis of a 360-day year
of twelve 30-day months and (ii) interest on any Securities that bear interest
at a variable rate shall be computed on the basis of the actual number of days
in an interest period divided by 360.
Section 3.11. Currency and Manner of Payment in Respect of
Securities.
(a) Unless otherwise specified with respect to any Securities
pursuant to Section 3.1, with respect to Registered Securities of any series not
permitting the election provided for in paragraph (b) below or the Holders of
which have not made the election provided for in paragraph (b) below, and with
respect to Bearer Securities of any series, except as provided in paragraph (d)
below, payment of the principal of, premium, if any, and interest, if any, on
any Registered or Bearer Security of such series will be made in the currency or
currencies or currency unit or units in which such Registered Security or Bearer
Security, as the case may be, is payable. The provisions of this Section 3.11
may be modified or superseded pursuant to Section 3.1 with
33
<PAGE> 41
respect to any Securities. For all purposes of this Indenture, currency units
shall include any composite currency.
(b) It may be provided pursuant to Section 3.1, with respect
to Registered Securities of any series, that Holders shall have the option,
subject to paragraphs (d) and (e) below, to receive payments of principal of,
premium, if any, or interest, if any, on such Registered Securities in any of
the currencies or currency units that may be designated for such election by
delivering to the Trustee (or the applicable Paying Agent) a written election
with signature guarantees and in the applicable form established pursuant to
Section 3.1, not later than the close of business on the Election Date
immediately preceding the applicable payment date. If a Holder so elects to
receive such payments in any such currency or currency unit, such election will
remain in effect for such Holder or any transferee of such Holder until changed
by such Holder or such transferee by written notice to the Trustee (or any
applicable Paying Agent) for such series of Registered Securities (but any such
change must be made not later than the close of business on the Election Date
immediately preceding the next payment date to be effective for the payment to
be made on such payment date, and no such change of election may be made with
respect to payments to be made on any Registered Security of such series with
respect to which an Event of Default has occurred or with respect to which the
Company has deposited funds pursuant to Article 4 or with respect to which a
notice of redemption has been given by the Company). Any Holder of any such
Registered Security who shall not have delivered any such election to the
Trustee (or any applicable Paying Agent) not later than the close of business on
the applicable Election Date will be paid the amount due on the applicable
payment date in the relevant currency or currency unit as provided in Section
3.11(a). The Trustee (or the applicable Paying Agent) shall notify the Exchange
Rate Agent as soon as practicable after the Election Date of the aggregate
principal amount of Registered Securities for which Holders have made such
written decision.
(c) If the election referred to in paragraph (b) above has
been provided for with respect to any Registered Securities of a series pursuant
to Section 3.1, then, unless otherwise specified pursuant to Section 3.1 with
respect to any such Registered Securities, not later than the fourth Business
Day after the Election Date for each payment date for such Registered
Securities, the Exchange Rate Agent shall deliver to the Company a written
notice specifying, in the currency or currencies or currency unit or units in
which Registered Securities of such series are payable, the respective aggregate
amounts of principal of, premium, if any, and interest, if any, on such
Registered Securities to be paid on such payment date, and specifying the
amounts in such currency or currencies or currency unit or units so payable in
respect of such Registered Securities as to which the Holders of Registered
Securities denominated in any currency or currencies or currency unit or units
shall have elected to be paid in another currency or currency unit as provided
in paragraph (b) above. If the election referred to in paragraph (b) above has
been provided for with respect to any Registered Securities of a series pursuant
to Section 3.1, and if at least one Holder has made such election, then, unless
otherwise specified pursuant to Section 3.1 on the second Business Day preceding
such payment date the Company will deliver to the Trustee (or the applicable
Paying Agent) an Exchange Rate Officer's Certificate in respect of the Dollar,
Foreign Currency or Currencies, ECU or other currency unit payments to be made
on such date. Unless otherwise specified pursuant to Section 3.1, the Dollar,
Foreign Currency or Currencies, ECU or other currency unit amount receivable by
Holders of Registered Securities who have elected payment in a currency
34
<PAGE> 42
or currency unit as provided in paragraph (b) above shall be determined by the
Company on the basis of the applicable Market Exchange Rate in effect on the
second Business Day (the "Valuation Date") immediately preceding each payment
date, and such determination shall be conclusive and binding for all purposes,
absent manifest error.
(d) If a Conversion Event occurs with respect to a Foreign
Currency, ECU or any other currency unit in which any of the Securities are
denominated or payable otherwise than pursuant to an election provided for
pursuant to paragraph (b) above, then, with respect to each date for the payment
of principal of, premium, if any, and interest, if any, on the applicable
Securities denominated or payable in such Foreign Currency, ECU or such other
currency unit occurring after the last date on which such Foreign Currency, ECU
or such other currency unit was used (the "Conversion Date"), the Dollar shall
be the currency of payment for use on each such payment date (but such Foreign
Currency, ECU or such other currency unit that was previously the currency of
payment shall, at the Company's election, resume being the currency of payment
on the first such payment date preceded by 15 Business Days during which the
circumstances that gave rise to the Dollar becoming such currency no longer
prevail). Unless otherwise specified pursuant to Section 3.1, the Dollar amount
to be paid by the Company to the Trustee or any applicable Paying Agent and by
the Trustee or any applicable Paying Agent to the Holders of such Securities
with respect to such payment date shall be determined, in the case of a Foreign
Currency other than a currency unit, on the basis of the Dollar Equivalent of
the Foreign Currency or, in the case of a Foreign Currency that is a currency
unit, on the basis of the Dollar Equivalent of the Currency Unit, in each case
as determined by the Exchange Rate Agent in the manner provided in paragraph (f)
or (g) below.
(e) Unless otherwise specified pursuant to Section 3.1, if the
Holder of a Registered Security denominated in any currency or currency unit
shall have elected to be paid in another currency or currency unit or in other
currencies as provided in paragraph (b) above, and (i) a Conversion Event occurs
with respect to any such elected currency or currency unit, such Holder shall
receive payment in the currency or currency unit in which payment would have
been made in the absence of such election and (ii) if a Conversion Event occurs
with respect to the currency or currency unit in which payment would have been
made in the absence of such election, such Holder shall receive payment in
Dollars as provided in paragraph (d) of this Section 3.11 (but, subject to any
contravening valid election pursuant to paragraph (b) above, the elected payment
currency or currency unit, in the case of the circumstances described in clause
(i) above, or the payment currency or currency unit in the absence of such
election, in the case of the circumstances described in clause (ii) above,
shall, at the Company's election, resume being the currency or currency unit of
payment with respect to Holders who have so elected, but only with respect to
payments on payment dates preceded by 15 Business Days during which the
circumstances that gave rise to such currency or currency unit, in the case of
the circumstances described in clause (i) above, or the Dollar, in the case of
the circumstances described in clause (ii) above, becoming the currency or
currency unit, as applicable, of payment, no longer prevail).
(f) The "Dollar Equivalent of the Foreign Currency " shall be
determined by the Exchange Rate Agent and shall be obtained by converting an
official unit of the specified Foreign Currency into Dollars at the Market
Exchange Rate for such specified Foreign Currency on the Conversion Date.
35
<PAGE> 43
(g) The "Dollar Equivalent of the Currency Unit" shall be
determined by the Exchange Rate Agent and, subject to the provisions of
paragraph (h) below, shall be the sum of each amount obtained by converting the
Specified Amount of each Component Currency into Dollars at the Market Exchange
Rate for such Component Currency on the Valuation Date with respect to each
payment.
(h) For purposes of this Section 3.11 the following terms
shall have the following meanings:
A "Component Currency" shall mean any currency which, on the
Conversion Date, was a component currency of the relevant currency unit,
including without limitation ECU.
"Election Date" shall mean the Regular Record Date applicable
to the payment date to which reference is made in Section 3.11(b) for the
applicable series of Registered Securities as specified pursuant to Section 3.1.
A "Specified Amount" of a Component Currency shall mean the
number of units of such Component Currency or fractions thereof that such
Component Currency represented in the relevant currency unit, including without
limitation ECU, on the Conversion Date. If after the Conversion Date the
official unit of any Component Currency is altered by way of combination or
subdivision, the Specified Amount of such Component Currency shall be divided or
multiplied in the same proportion. If after the Conversion Date two or more
Component Currencies are consolidated into a single currency, the respective
Specified Amounts of such Component Currencies shall be replaced by an amount in
such single currency equal to the sum of the respective Specified Amounts of
such consolidated Component Currencies expressed in such single currency, and
such amount shall thereafter be a Specified Amount and such single currency
shall thereafter be a Component Currency. If after the Conversion Date any
Component Currency shall be divided into two or more currencies, the Specified
Amount of such Component Currency shall be replaced by specified amounts of such
two or more currencies, the sum of which, at the Market Exchange Rate of such
two or more currencies on the date of such replacement, shall be equal to the
Specified Amount of such former Component Currency and such amounts shall
thereafter be Specified Amounts and such currencies shall thereafter be
Component Currencies. If, after the Conversion Date of the relevant currency
unit, including without limitation ECU, a Conversion Event (other than any event
referred to above in this definition of "Specified Amount") occurs with respect
to any Component Currency of such currency unit and is continuing on the
applicable Valuation Date, the Specified Amount of such Component Currency
shall, for purposes of calculating the Dollar Equivalent of the Currency Unit,
be converted into Dollars at the Market Exchange Rate in effect on the
Conversion Date of such Component Currency.
All decisions and determinations of the Exchange Rate Agent
regarding the Dollar Equivalent of the Foreign Currency, the Dollar Equivalent
of the Currency Unit, the Market Exchange Rate and changes in the Specified
Amounts as specified above shall be made by the Exchange Rate Agent in good
faith in accordance with the provisions of this Indenture and any applicable
Board Resolution or Officer's Certificate and shall, in the absence of manifest
error, be conclusive for all purposes and irrevocably binding upon the Company,
the Trustee (and any
36
<PAGE> 44
applicable Paying Agent) and all Holders of Securities denominated or payable in
the relevant currency, currencies or currency units. The Exchange Rate Agent
shall promptly give written notice to the Company and the Trustee of any such
decision or determination.
If the Company determines in good faith that a Conversion
Event has occurred with respect to a Foreign Currency, the Company shall
promptly give written notice thereof to the Trustee (or any applicable Paying
Agent) and to the Exchange Rate Agent (and the Trustee (or such Paying Agent)
shall promptly thereafter give notice thereof in the manner provided in Section
1.6 to the affected Holders) specifying the Conversion Date. If the Company so
determines that a Conversion Event has occurred with respect to ECU or any other
currency unit in which Securities are denominated or payable, the Company shall
promptly give written notice thereof to the Trustee (or any applicable Paying
Agent) and to the Exchange Rate Agent (and the Trustee (or such Paying Agent)
shall promptly thereafter give notice thereof in the manner provided in Section
1.6 to the affected Holders) specifying the Conversion Date and the Specified
Amount of each Component Currency on the Conversion Date. If the Company
determines in good faith that any subsequent change in any Component Currency as
set forth in the definition of Specified Amount above has occurred, the Company
shall similarly give written notice to the Trustee (or any applicable Paying
Agent) and to the Exchange Rate Agent.
The Trustee of the appropriate series of Securities shall be
fully justified and protected in relying and acting upon information received by
it from the Company and the Exchange Rate Agent and shall not otherwise have any
duty or obligation to determine the accuracy or validity of such information
independently of the Company or the Exchange Rate Agent.
Section 3.12. Appointment and Resignation of Exchange Rate
Agent.
(a) Unless otherwise specified pursuant to Section 3.1, if and
so long as the Securities of any series (i) are denominated in a currency or
currency unit other than Dollars or (ii) may be payable in a currency or
currency unit other than Dollars, or so long as it is required under any other
provision of this Indenture, then the Company shall maintain with respect to
each such series of Securities, or as so required, at least one Exchange Rate
Agent. The Company shall cause the Exchange Rate Agent to make the necessary
foreign exchange determinations at the time and in the manner specified pursuant
to Section 3.11 for the purpose of determining the applicable rate of exchange
and, if applicable, for the purpose of converting the issued currency or
currencies or currency unit or units into the applicable payment currency or
currency unit for the payment of principal, premium, if any, and interest, if
any, pursuant to Section 3.11.
(b) No resignation of the Exchange Rate Agent and no
appointment of a successor Exchange Rate Agent pursuant to this Section shall
become effective until the acceptance of appointment by the successor Exchange
Rate Agent as evidenced by a written instrument delivered to the Company and the
Trustee of the appropriate series of Securities accepting such appointment
executed by the successor Exchange Rate Agent.
(c) If the Exchange Rate Agent shall resign, be removed or
become incapable of acting or if a vacancy shall occur in the office of the
Exchange Rate Agency for any cause with
37
<PAGE> 45
respect to the Securities of one or more series, the Company shall promptly
appoint a successor Exchange Rate Agent or Exchange Rate Agents with respect to
the Securities of that or those series (it being understood that any such
successor Exchange Rate Agent may be appointed with respect to the Securities of
one or more or all of such series and that, unless otherwise specified pursuant
to Section 3.1, at any time there shall only be one Exchange Rate Agent with
respect to the Securities of any particular series that were originally issued
by the Company on the same date and that were initially denominated and/or
payable in the same currency or currencies or currency unit or units).
Section 3.13. CUSIP Numbers. The Company in issuing the
Securities may use "CUSIP" numbers (if then generally in use), and, if so, the
Trustee shall use "CUSIP" numbers (in addition to the other identification
numbers printed on the Securities) in notices of redemption as a convenience to
Holders; provided, however, that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers.
Section 3.14. Judgments. If for the purpose of obtaining a
judgment in any court with respect to any obligation of the Company hereunder or
under any Security, it shall become necessary to convert into any other currency
any amount in the currency due hereunder or under such Security, then such
conversion shall be made at the Market Exchange Rate as in effect on the date
the Company shall make payment to any Person in satisfaction of such judgment.
If pursuant to any such judgment, conversion shall be made on a date other than
the date payment is made and there shall occur a change between such Market
Exchange Rate and the Market Exchange Rate as in effect on the date of payment,
the Company agrees to pay such additional amounts (if any) as may be necessary
to ensure that the amount paid is equal to the amount in such other currency
which, when converted at the Market Exchange Rate as in effect on the date of
payment or distribution, is the amount then due hereunder or under such
Security. Any amount due from the Company under this Section 3.14 shall be due
as a separate debt and is not to be affected by or merged into any judgment
being obtained for any other sums due hereunder or in respect of any Security.
In no event, however, shall the Company be required to pay more in the currency
or currency unit due hereunder or under such Security at the Market Exchange
Rate as in effect when payment is made than the amount of currency stated to be
due hereunder or under such Security so that in any event the Company's
obligations hereunder or under such Security will be effectively maintained as
obligations in such currency, and the Company shall be entitled to withhold (or
be reimbursed for, as the case may be) any excess of the amount actually
realized upon any such conversion over the amount due and payable on the date of
payment or distribution.
ARTICLE 4
SATISFACTION, DISCHARGE AND DEFEASANCE
Section 4.1. Termination of Company's Obligations Under the
Indenture. Except as otherwise provided as contemplated by Section 3.1, this
Indenture shall upon Company Request cease to be of further effect with respect
to Securities of or within any series and any coupons
38
<PAGE> 46
appertaining thereto (except as to any surviving rights of registration of
transfer or exchange of such Securities and replacement of such Securities which
may have been lost, stolen or mutilated as herein expressly provided for) and
the Trustee, at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to such
Securities and any coupons appertaining thereto when
(1) either
(A) all such Securities previously authenticated and
delivered and all coupons appertaining thereto (other than (i)
such coupons appertaining to Bearer Securities surrendered in
exchange for Registered Securities, and maturing after such
exchange, surrender of which is not required or has been
waived as provided in Section 3.5, (ii) such Securities and
coupons which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 3.6, (iii)
such coupons appertaining to Bearer Securities called for
redemption and maturing after the relevant Redemption Date,
surrender of which has been waived as provided in Section 10.6
and (iv) such Securities and coupons for whose payment money
has theretofore been deposited in trust or segregated and held
in trust by the Company and thereafter repaid to the Company
or discharged from such trust, as provided in Section 9.3)
have been delivered to the Trustee for cancellation; or
(B) all Securities of such series and, in the case of
(i) and (ii) below, any coupons appertaining thereto not
theretofore delivered to the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their
Stated Maturity within one year, or
(iii) if redeemable at the option of the
Company, are to be called for redemption within one
year under arrangements satisfactory to the Trustee
for the giving of notice of redemption by the Trustee
in the name, and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
irrevocably deposited or caused to be deposited with the Trustee as
trust funds in trust for the purpose an amount in the currency or
currencies or currency unit or units in which the Securities of such
series are payable, sufficient to pay and discharge the entire
indebtedness on such Securities and such coupons not theretofore
delivered to the Trustee for cancellation, for principal, premium, if
any, and interest, if any, with respect thereto, to the date of such
deposit (in the case of Securities which have become due and payable)
or to the Stated Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all
other sums payable hereunder by the Company; and
39
<PAGE> 47
(3) the Company has delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture as to such series have been complied
with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee and any predecessor Trustee under
Section 6.9, the obligations of the Company to any Authenticating Agent under
Section 6.14 and, if money shall have been deposited with the Trustee pursuant
to subclause (B) of clause (1) of this Section, the obligations of the Trustee
under Section 4.2 and the last paragraph of Section 9.3 shall survive. If, after
the deposit referred to in Section 4.1 has been made, (x) the Holder of a
Security is entitled to, and does, elect pursuant to Section 3.11(b), to receive
payment in a currency other than that in which the deposit pursuant to Section
4.1 was made, or (y) if a Conversion Event occurs with respect to the currency
in which the deposit was made or elected to be received by the Holder pursuant
to Section 3.11(b), then the indebtedness represented by such Security shall be
fully discharged to the extent that the deposit made with respect to such
Security shall be converted into the currency in which such payment is made.
Section 4.2. Application of Trust Funds. Subject to the
provisions of the last paragraph of Section 9.3, all money deposited with the
Trustee pursuant to Section 4.1 shall be held in trust and applied by it, in
accordance with the provisions of the Securities, the coupons and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal, premium, if any,
and any interest for whose payment such money has been deposited with or
received by the Trustee. Such money need not be segregated from other funds
except to the extent required by law and except that the Trustee shall segregate
moneys, funds and accounts held by the Trustee in one currency or currency unit
from any moneys, funds or accounts held in any other currencies or currency
units.
Section 4.3. Applicability of Defeasance Provisions; Company
Option to Effect Defeasance or Covenant Defeasance. If pursuant to Section 3.1
provision is made for either or both of (i) defeasance of the Securities of or
within a series under Section 4.4 or (ii) covenant defeasance of the Securities
of or within a series under Section 4.5, then the provisions of such Section or
Sections, as the case may be, together with the provisions of Sections 4.6
through 4.9 inclusive, with such modifications thereto as may be specified
pursuant to Section 3.1 with respect to such Securities, shall be applicable to
such Securities and any coupons appertaining thereto, and the Company may at its
option, at any time, with respect to such Securities and any coupons
appertaining thereto, elect to have Section 4.4 (if applicable) or Section 4.5
(if applicable) be applied to such Securities and any coupons appertaining
thereto upon compliance with the conditions set forth below in this Article.
Section 4.4. Defeasance and Discharge. Upon the Company's
exercise of the option specified in Section 4.3 applicable to this Section with
respect to the Securities of or within a series, the Company shall be deemed to
have been discharged from its obligations with respect to such Securities and
any coupons appertaining thereto on the date the conditions set forth in Section
4.6 are satisfied (hereinafter "defeasance"). For this purpose, such defeasance
means that the Company shall be deemed to have paid and discharged the entire
indebtedness represented by such
40
<PAGE> 48
Securities and any coupons appertaining thereto which shall thereafter be deemed
to be "Outstanding" only for the purposes of Section 4.7 and the other Sections
of this Indenture referred to in clause (ii) of this Section, and to have
satisfied all its other obligations under such Securities and any coupons
appertaining thereto and this Indenture insofar as such Securities and any
coupons appertaining thereto are concerned (and the Trustee, at the expense of
the Company, shall on Company Order execute proper instruments acknowledging the
same), except the following which shall survive until otherwise terminated or
discharged hereunder: (i) the rights of Holders of such Securities and any
coupons appertaining thereto to receive, solely from the trust funds described
in Section 4.6(a) and as more fully set forth in such Section, payments in
respect of the principal of, premium, if any, and interest, if any, on such
Securities or any coupons appertaining thereto when such payments are due; (ii)
the Company's obligations with respect to such Securities under Sections 3.5,
3.6, 6.10, 9.2 and 9.3 and with respect to the payment of additional amounts, if
any, payable with respect to such Securities as specified pursuant to Section
3.1(b)(16); (iii) the rights, powers, trusts, duties and immunities of the
Trustee hereunder, and (iv) this Article 4. Subject to compliance with this
Article 4, the Company may exercise its option under this Section
notwithstanding the prior exercise of its option under Section 4.5 with respect
to such Securities and any coupons appertaining thereto. Following a defeasance,
payment of such Securities may not be accelerated because of an Event of
Default.
Section 4.5. Covenant Defeasance. Upon the Company's exercise
of the option specified in Section 4.3, applicable to this Section with respect
to any Securities of or within a series, the Company shall be released from its
obligations under Sections 7.1, 9.4 and 9.5, and, if specified pursuant to
Section 3.1, its obligations under any other covenant, with respect to such
Securities and any coupons appertaining thereto on and after the date the
conditions set forth in Section 4.6 are satisfied (hereinafter, "covenant
defeasance"), and such Securities and any coupons appertaining thereto shall
thereafter be deemed to be not "Outstanding" for the purposes of any direction,
waiver, consent or declaration or Act of Holders (and the consequences of any
thereof) in connection with Sections 7.1, 9.4 and 9.5, or such other covenant,
but shall continue to be deemed "Outstanding" for all other purposes hereunder.
For this purpose, such covenant defeasance means that, with respect to such
Securities and any coupons appertaining thereto, the Company may omit to comply
with and shall have no liability in respect of any term, provision, covenant,
condition or limitation set forth in any such Section or such other covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such Section or such other covenant or by reason of any reference in any
such Section or such other covenant to any other provision herein or in any
other document and such omission to comply shall not constitute a Default or an
Event of Default under Section 5.1(3) or 5.1(6) or otherwise, as the case may
be, but, except as specified above, the remainder of this Indenture and such
Securities and any coupons appertaining thereto shall be unaffected thereby.
Section 4.6. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of Section 4.4 or Section
4.5 to any Securities of or within a series and any coupons appertaining
thereto:
(a) The Company shall have deposited or caused to be deposited
irrevocably with the Trustee (or another trustee satisfying the requirements of
Section 6.12 who shall agree to comply with, and shall be entitled to the
benefits of, the provisions of Section 4.3 through 4.9 inclusive and
41
<PAGE> 49
the last paragraph of Section 9.3 applicable to the Trustee, for purposes of
such Sections also a "Trustee") as trust funds in trust for the purpose of
making the payments referred to in clauses (x) and (y) of this Section 4.6(a),
specifically pledged as security for, and dedicated solely to, the benefit of
the Holders of such Securities and any coupons appertaining thereto, with
instructions to the Trustee as to the application thereof, (A) money in an
amount (in such currency, currencies or currency unit or units in which such
Securities and any coupons appertaining thereto are then specified as payable at
Maturity), or (B) if Securities of such series are not subject to repayment at
the option of Holders, Government Obligations which through the payment of
principal and interest in respect thereof in accordance with their terms will
provide, not later than one day before the due date of any payment referred to
in clause (x) or (y) of this Section 4.6(a), money in an amount or (C) a
combination thereof in an amount, sufficient, in the opinion of a nationally
recognized firm of independent certified public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and discharge,
and which shall be applied by the Trustee to pay and discharge, (x) the
principal of, premium, if any, and interest, if any, on such Securities and any
coupons appertaining thereto on the Maturity of such principal or installment of
principal or interest and (y) any mandatory sinking fund payments applicable to
such Securities on the day on which such payments are due and payable in
accordance with the terms of this Indenture and such Securities and any coupons
appertaining thereto. Before such a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of Securities at a future date or
dates in accordance with Article 10, which shall be given effect in applying the
foregoing.
(b) Such defeasance or covenant defeasance shall not result in
a breach or violation of, or constitute a Default or Event of Default under,
this Indenture or result in a breach or violation of, or constitute a default
under, any other material agreement or instrument to which the Company is a
party or by which it is bound.
(c) No Default or Event under Section 5.1(4) or 5.1(5) with
respect to such Securities and any coupons appertaining thereto shall have
occurred and be continuing during the period commencing on the date of such
deposit and ending on the 91st day after such date (it being understood that
this condition shall not be deemed satisfied until the expiration of such
period).
(d) In the case of an election under Section 4.4, the Company
shall have delivered to the Trustee an Officer's Certificate and an Opinion of
Counsel stating that (i) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (ii) since the date of
execution of this Indenture, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based thereon such
opinion shall confirm that, the Holders of such Securities and any coupons
appertaining thereto will not recognize income, gain or loss for federal income
tax purposes as a result of such defeasance and will be subject to federal
income tax on the same amounts and in the same manner and at the same times, as
would have been the case if such deposit, defeasance and discharge had not
occurred.
(e) In the case of an election under Section 4.5, the Company
shall have delivered to the Trustee an Officer's Certificate and an Opinion of
Counsel to the effect that the Holders of such Securities and any coupons
appertaining thereto will not recognize income, gain or loss for federal income
tax purposes as a result of such covenant defeasance and will be subject to
federal
42
<PAGE> 50
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such covenant defeasance had not occurred.
(f) The Company shall have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each stating that all
conditions precedent to the defeasance under Section 4.4 or the covenant
defeasance under Section 4.5 (as the case may be) have been complied with.
(g) Such defeasance or covenant shall be effected in
compliance with any additional or substitute terms, conditions or limitations
which may be imposed on the Company in connection therewith as contemplated by
Section 3.1.
Section 4.7. Deposited Money and Government Obligations To Be
Held in Trust. Subject to the provisions of the last paragraph of Section 9.3,
all money and Government Obligations (or other property as may be provided
pursuant to Section 3.1, including the proceeds thereof) deposited with the
Trustee pursuant to Section 4.6 in respect of any Securities of any series and
any coupons appertaining thereto shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Securities and any coupons
appertaining thereto and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as its own Paying Agent)
as the Trustee may determine, to the Holders of such Securities and any coupons
appertaining thereto of all sums due and to become due thereon in respect of
principal, premium, if any, and interest, if any. Such money need not be
segregated from other funds except to the extent required by law and except that
the Trustee shall segregate moneys, funds and accounts held by the Trustee in
one currency or currency unit from any moneys, funds or accounts held in any
other currencies or currency units.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the Government
Obligations deposited pursuant to Section 4.6 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of such Securities.
Unless otherwise specified with respect to any Security
pursuant to Section 3.1, if, after a deposit referred to in Section 4.6(a) has
been made, (i) the Holder of a Security in respect of which such deposit was
made is entitled to, and does, elect pursuant to Section 3.11(b) or the terms of
such Security to receive payment in a currency or currency unit other than that
in which the deposit pursuant to Section 4.6(a) has been made in respect of such
Security, or (ii) a Conversion Event occurs as contemplated in Section 3.11(d)
or 3.11(e) or by the terms of any Security in respect of which the deposit
pursuant to Section 4.6(a) has been made, the indebtedness represented by such
Security and any coupons appertaining thereto shall be deemed to have been, and
will be, fully discharged and satisfied through the payment of the principal of,
premium, if any, and interest, if any, on such Security as the same becomes due
out of the proceeds yielded by converting (from time to time specified below in
the case of any such election) the amount or other property deposited in respect
of such Security into the currency or currency unit in which such Security
becomes payable as a result of such election or Conversion Event based on the
applicable Market Exchange Rate for such currency or currency unit in effect on
the second Business Day prior to each payment date or, in the case of the
occurrence and continuance of a Conversion Event with respect to such currency
43
<PAGE> 51
or currency unit, based on the applicable Market Exchange Rate for such currency
or currency unit which is in effect at the time of the Conversion Event.
Section 4.8. Transfers and Distribution at Company Request. To
the extent permitted by the Financial Accounting Standards Board Statement of
Financial Accounting Standards No. 76, as amended or interpreted by the
Financial Accounting Standards Board from time to time, or any successor thereto
("Standard No. 76"), or to the extent permitted by the Commission, the Trustee
shall, from time to time, take one or more of the following actions as specified
in a Company Request.
(a) Retransfer, assign and deliver to the Company any
securities deposited with the Trustee pursuant to Section 4.6(a), provided that
the Company shall, in substitution therefor, simultaneously transfer, assign,
and deliver to the Trustee other Government Obligations appropriate to satisfy
the Company's obligations in respect of the relevant Securities; and
(b) The Trustee (and any Paying Agent) shall promptly pay to
the Company, upon Company Request, any excess money or securities held by them
at any time, including, without limitation, any assets deposited with the
Trustee pursuant to Section 4.6(a) exceeding those necessary for the purposes of
Section 4.6(a).
The Trustee shall not take the actions described in subsections (a) and (b) of
this Section 4.8 unless it shall have first received a written report of Ernst &
Young LLP, or another nationally recognized independent public accounting firm
(i) expressing their opinion that the contemplated action is permitted by
Standard No. 76 or the Commission, for transactions accounted for as
extinguishment of debt under the circumstances described in paragraph 3.c of
Standard No. 76 or any successor provision and (ii) verifying the accuracy,
after giving effect to such action or actions, of the computations which
demonstrate that the amounts remaining to be earned on the Government
Obligations deposited with the Trustee pursuant to Section 4.6(a) will be
sufficient for purposes of Section 4.6(a).
Section 4.9. Reinstatement. If the Trustee or the Paying Agent
is unable to apply any money in accordance with Section 4.7 by reason of any
order or judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, then the Company's obligations under
this Indenture and the Securities of the series with respect to which such money
was deposited shall be revived and reinstated as though no deposit had occurred
pursuant to this Article 4 until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 4.7; provided,
however, that if the Company makes any payment of principal of (or premium, if
any, on) or interest, if any, on any Securities of any series following the
reinstatement of the Company's obligations, the Company shall be subrogated to
the rights of the Holders of such Securities to receive such payment from the
money held by the Trustee or the Paying Agent with respect to such Securities.
44
<PAGE> 52
ARTICLE 5
DEFAULTS AND REMEDIES
Section 5.1. Events of Default. An "Event of Default" occurs
with respect to the Securities of any series if (regardless of the reason for
such Event of Default and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):
(1) the Company defaults in the payment of any
interest on any Security of that series or any coupon
appertaining thereto or any additional amount payable with
respect to any Security of that series as specified pursuant
to Section 3.1(b)(16) when the same becomes due and payable
and such default continues for a period of 30 days;
(2) the Company defaults in the payment of the
principal of or any premium on any Security of that series
when the same becomes due and payable at its Maturity or on
redemption or otherwise, or in the payment of a mandatory
sinking fund payment when and as due by the terms of the
Securities of that series;
(3) the Company defaults in the performance of, or
breaches, any covenant or warranty of the Company in this
Indenture with respect to any Security of that series (other
than a covenant or warranty a default in whose performance or
whose breach is elsewhere in this Section specifically dealt
with), and such default or breach continues 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 the Holders of at least 25% in aggregate principal
amount of the Outstanding Securities of that series, a written
notice specifying such default or breach and requiring it to
be remedied and stating that such notice is a "Notice of
Default" hereunder;
(4) the Company pursuant to or within the meaning of
any Bankruptcy Law (A) commences a voluntary case, (B)
consents to the entry of an order for relief against it in an
involuntary case, (C) consents to the appointment of a
Custodian of it or for all or substantially all of its
property, or (D) makes a general assignment for the benefit of
its creditors;
(5) a court of competent jurisdiction enters an order
or decree under any Bankruptcy Law that (A) is for relief
against the Company in any involuntary case, (B) appoints a
Custodian of the Company or for all or substantially all of
its property, or (C) orders the liquidation of the Company and
the order or decree remains unstayed and in effect for 90
days; or
(6) any other Event of Default provided as
contemplated by Section 3.1 with respect to Securities of that
series.
45
<PAGE> 53
The term "Bankruptcy Law" means Title 11, U.S. Code, or any
similar federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
Section 5.2. Acceleration; Rescission and Annulment. If an
Event of Default with respect to the Securities of any series at the time
Outstanding occurs and is continuing, the Trustee or the Holders of at least 25%
in aggregate principal amount of all of the Outstanding Securities of that
series, by written notice to the Company (and, if given by the Holders, to the
Trustee), may declare the principal (or, if the Securities of that series are
Original Issue Discount Securities or Indexed Securities, such portion of the
principal amount as may be specified in the terms of that series) of all the
Securities of that series to be due and payable and upon any such declaration
such principal (or, in the case of Original Issue Discount Securities or Indexed
Securities, such specified amount) shall be immediately due and payable.
At any time after such a declaration of acceleration with
respect to Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter in this Article provided, the Holders of a majority in aggregate
principal amount of the Outstanding Securities of that series, by written notice
to the Company and the Trustee, may rescind and annul such declaration and its
consequences if all existing Defaults and Events of Default with respect to
Securities of that series, other than the non-payment of the principal of
Securities of that series which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 5.7. No such
rescission shall affect any subsequent default or impair any right consequent
thereon.
Section 5.3. Collection of Indebtedness and Suits for
Enforcement by Trustee. The Company covenants that if
(1) default is made in the payment of any interest on
any Security or coupon, if any, when such interest becomes due
and payable and such default continues for a period of 30
days, or
(2) default is made in the payment of the principal
of (or premium, if any, on) any Security at the Maturity
thereof and such default continues for a period of 10 days, or
(3) default is made in the making or satisfaction of
any sinking fund payment or analogous obligation when the same
becomes due pursuant to the terms of the Securities of any
series,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities or coupons, if any, the whole amount then due and
payable on such Securities for principal, premium, if any, and interest, if any,
and, to the extent that payment of such interest shall be legally enforceable,
interest on any overdue principal, premium, if any, and on any overdue interest,
at the rate or rates prescribed therefor in such Securities or coupons, if any,
and, in addition thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection,
46
<PAGE> 54
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Company or any other obligor upon such Securities
and coupons, if any, and collect the moneys adjudged or decreed to be payable in
the manner provided by law out of the property of the Company or any other
obligor upon such Securities and coupons, if any, wherever situated.
If an Event of Default with respect to Securities of any
series occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of Securities of
such series by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
Section 5.4. Trustee May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceedings, or any voluntary or involuntary case under the federal bankruptcy
laws, as now or hereafter constituted, relative to the Company or any other
obligor upon the Securities and coupons, if any, of a particular series or the
property of the Company or of such other obligor, the Trustee (irrespective of
whether the principal of such Securities shall then be due and payable as
therein expressed or by declaration of acceleration or otherwise and
irrespective of whether the Trustee shall have made any demand on the Company
for the payment of overdue principal or interest) shall be entitled and
empowered, by intervention in such proceeding or otherwise,
(i) to file and prove a claim for the whole amount of
principal (or, if the Securities of such series are Original Issue
Discount Securities, such portion of the principal amount as may be due
and payable with respect to such series pursuant to a declaration in
accordance with Section 5.2) (and premium, if any) and interest, if
any, owing and unpaid in respect of the Securities and any coupons of
such series and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and
of the Holders of such Securities and any coupons allowed in such
judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, custodian, liquidator, sequestrator (or
other similar official) in any such proceeding is hereby authorized by each such
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
47
<PAGE> 55
such 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 6.9.
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 and any coupons of such series or the rights of any Holder thereof,
or to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.
Section 5.5. 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, and any recovery of judgment
shall, after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities or any coupons in respect of
which such judgment has been recovered.
Section 5.6. Delay or Omission Not Waiver. No delay or
omission by the Trustee or any Holder of any Security to exercise any right or
remedy accruing upon any Event of Default shall impair any such right or remedy
or constitute a waiver of or acquiescence in any such Event of Default. Every
right and remedy given by this Indenture 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 5.7. Waiver of Past Defaults. The Holders of not less
than a majority in aggregate principal amount of the Outstanding Securities of
any series by notice to the Trustee may waive on behalf of the Holders of all
Securities of such series a past Default or Event of Default with respect to
such series and its consequences except (i) a Default or Event of Default in the
payment of the principal of, premium, if any, or interest, if any, on any
Security of such series or any coupon appertaining thereto or (ii) in respect of
a covenant or provision hereof which pursuant to Section 8.2 cannot be amended
or modified without the consent of the Holder of each Outstanding Security of
such series adversely affected. Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have
been cured, for every purpose of this Indenture, but no such waiver shall extend
to any subsequent or other default or impair any right consequent thereon.
Section 5.8. Control by Majority. The Holders of not less than
a majority in aggregate principal amount of the Outstanding Securities of each
series affected (with each such series voting as a class) shall have the right
to direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee with respect to Securities of such series; provided, however, that (i)
the Trustee may refuse to follow any direction that conflicts with law or this
Indenture, (ii) subject to Section 6.1, the Trustee may refuse to follow any
direction that is unduly prejudicial to the rights of the Holders of
48
<PAGE> 56
Securities of any such series not consenting, or that would in the good faith
judgment of the Trustee have a substantial likelihood of involving the Trustee
in personal liability and (iii) the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such direction.
Section 5.9. Limitation on Suits by Holders. No Holder of any
Security of any series or any related coupons shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder,
unless:
(1) such Holder has previously given written notice
to the Trustee of a continuing Event of Default with respect
to the Securities of that series;
(2) the Holders of at least 25% in aggregate
principal amount of the Outstanding Securities of that series
have made a written request to the Trustee to institute
proceedings in respect of such Event of Default in its own
name as Trustee hereunder;
(3) such Holder or Holders have offered to the
Trustee indemnity satisfactory to the Trustee against any
loss, cost, liability or expense to be, or which may be,
incurred by the Trustee in pursuing the remedy;
(4) the Trustee for 60 days after its receipt of such
notice, request and the offer of indemnity has failed to
institute any such proceedings; and
(5) during such 60-day period, the Holders of a
majority in aggregate principal amount of the Outstanding
Securities of that series have not given to the Trustee a
direction inconsistent with such written request.
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 of such Holders, or to
obtain or to seek to obtain priority or preference over any other of such
Holders or to enforce any right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit of all of such Holders.
For the protection and enforcement of the provisions of this Section 5.9, each
and every Holder of Securities or any coupons of any series and the Trustee for
such series shall be entitled to such relief as can be given at law or in
equity.
Section 5.10. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, but subject to Section
9.2, the right of any Holder of a Security or coupon to receive payment of
principal of, premium, if any, and, subject to Sections 3.5 and 3.7, interest,
if any, on such Security, on or after the respective due dates expressed in such
Security (or, in case of redemption, on the Redemption Dates) and the right of
any Holder of a coupon to receive payment of interest due as provided in such
coupon, or, subject to Section 5.9, to bring suit for the enforcement of any
such payment on or after such respective dates, shall not be impaired or
affected without the consent of such Holder.
49
<PAGE> 57
Section 5.11. Application of Money Collected. If the Trustee
collects any money pursuant to this Article, it shall pay out the money in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money on account of principal, premium, if any, or
interest, if any, upon presentation of the Securities and the notation thereon
of the payment if only partially paid and upon surrender thereof if fully paid:
First: to the Trustee for amounts due under Section
6.9;
Second: to Holders of Securities and coupons in
respect of which or for the benefit of which such money has
been collected for amounts due and unpaid on such Securities
for principal of, premium, if any, and interest, if any,
ratably, without preference or priority of any kind, according
to the amounts due and payable on such Securities for
principal, premium, if any, and interest, if any,
respectively; and
Third: to the Person or Persons entitled thereto.
Section 5.12. Restoration of Rights and Remedies. If the
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company, the Trustee and the Holders shall be restored severally
and respectively to their former positions hereunder and thereafter all rights
and remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
Section 5.13. Rights and Remedies Cumulative. Except as
otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities in the last paragraph of Section 3.6, no
right or remedy herein conferred upon or reserved to the Trustee or 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 5.14. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken, suffered or omitted by it as Trustee, a court
may require any party litigant in such suit to file an undertaking to pay the
costs of such suit, and may assess costs against any such party litigant, in the
manner and to the extent provided in the Trust Indenture Act; provided that
neither this Section nor the Trust Indenture Act shall be deemed to authorize
any court to require such an undertaking or to make such an assessment in any
suit instituted by the Company.
Section 5.15. Waiver of Stay or Extension Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this
50
<PAGE> 58
Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
ARTICLE 6
THE TRUSTEE
Section 6.1. Certain Duties and Responsibilities. The duties
and responsibilities of the Trustee shall be as provided by the Trust Indenture
Act. Notwithstanding the foregoing, no provision of this Indenture shall require
the Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it. Whether or not therein expressly
so provided, every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
Section 6.2. Rights of Trustee. Subject to the provisions of
the Trust Indenture Act:
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note or other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties.
(b) Any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order (other
than delivery of any Security, together with any coupons appertaining thereto,
to the Trustee for authentication and delivery pursuant to Section 3.3, which
shall be sufficiently evidenced as provided therein), and any resolution of the
Board of Directors may be sufficiently evidenced by a Board Resolution.
(c) Whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad faith on
its part, rely upon an Officer's Certificate or Opinion of Counsel.
(d) The Trustee may consult with counsel of its selection and
the written advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon.
(e) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders pursuant to this
51
<PAGE> 59
Indenture, unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.
(f) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters as it
may see fit, and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney.
(g) The Trustee may act through agents or attorneys and shall
not be responsible for the misconduct or negligence of any agent or attorney
appointed with due care by it hereunder.
(h) 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.
Section 6.3. Trustee May Hold Securities. The Trustee, any
Authenticating Agent, any Paying Agent, any Registrar or any other agent of the
Company, in its individual or any other capacity, may become the owner or
pledgee of Securities and coupons and, subject to Sections 310(b) and 311 of the
Trust Indenture Act, may otherwise deal with the Company, an Affiliate or
Subsidiary with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Registrar or such other agent.
Section 6.4. Money Held in Trust. Money held by the Trustee or
any Paying Agent in trust hereunder need not be segregated from other funds
except to the extent required by law. Neither the Trustee nor any Paying Agent
shall be under any liability for interest on any money received by it hereunder
except as otherwise set forth in this Indenture or as otherwise agreed with the
Company.
Section 6.5. Trustee's Disclaimer. The recitals contained
herein and in the Securities, except the Trustee's certificate of
authentication, shall be taken as the statements of the Company, and neither the
Trustee nor the Authenticating Agent assumes any responsibility for their
correctness. Neither the Trustee nor the Authenticating Agent makes any
representation as to the validity or adequacy of this Indenture, the Securities
or any coupon. The Trustee shall not be accountable for the Company's use of the
proceeds from the Securities or for monies paid over to the Company pursuant to
the Indenture.
Section 6.6. Notice of Defaults. If a Default occurs and is
continuing with respect to the Securities of any series and if it is known to
the Trustee, the Trustee shall, within 90 days after it occurs, transmit, in the
manner and to the extent provided in Section 313(c) of the Trust Indenture Act,
notice of all uncured Defaults known to it; provided, however, that, except in
the case of a Default in payment on the Securities of any series, the Trustee
may withhold the notice if and so long as the board of directors, the executive
committee or a committee of its Responsible Officers in good faith determines
that withholding such notice is in the interests of the Holders of Securities
52
<PAGE> 60
of such series; provided further that, in the case of any Default or breach of
the character specified in Section 5.1(3) with respect to the Securities and
coupons of such series, no such notice to Holders shall be given until at least
60 days after the occurrence thereof.
Section 6.7. Reports by Trustee to Holders. (a) Within 60 days
after each May 15 of each year commencing with the first May 15 after the first
issuance of Securities pursuant to this Indenture, the Trustee shall transmit by
mail to all Holders of Securities as provided in Section 313(c) of the Trust
Indenture Act a brief report dated as of such May 15 if required by Section
313(a) of the Trust Indenture Act. The Trustee also shall comply with Section
313(b) and (d) of the Trust Indenture Act and shall transmit to the Holders, in
the manner and to the extent provided in said Section 313(c) of the Trust
Indenture Act, such other reports, if any, as may be required pursuant to the
Trust Indenture Act.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which any Securities are listed, with the Commission and with the Company. The
Company will notify the Trustee when any Securities are listed on any stock
exchange.
Section 6.8. 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 of Securities of each series. If the
Trustee is not the Registrar, the Company shall furnish to the Trustee
semiannually on or before the last day of June and December in each year, 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 may reasonably require, containing all the
information in the possession of the Registrar, the Company or any of its Paying
Agents other than the Trustee as to the names and addresses of Holders of
Securities of each such series. If there are Bearer Securities of any series
Outstanding, even if the Trustee is the Registrar, the Company shall furnish to
the Trustee such a list containing such information with respect to Holders of
such Bearer Securities only.
Section 6.9. Compensation and Indemnity.
(a) The Company shall pay to the Trustee from time to time
such compensation as shall be agreed between the Company and the Trustee for all
services rendered by the Trustee hereunder. 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 its request for all reasonable
out-of-pocket expenses incurred by it in connection with the performance of its
duties under this Indenture, except any such expense as may be attributable to
its negligence or bad faith. Such expenses shall include the reasonable
compensation and expenses of the Trustee's agents and counsel.
(b) The Company shall indemnify the Trustee for, and hold it
harmless against, any loss, liability or expense incurred by it without
negligence or bad faith on its part arising out of or in connection with its
acceptance or administration of the trust or trusts hereunder. The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity. The
Company shall defend the claim and the Trustee shall cooperate in the defense.
The Trustee may have separate
53
<PAGE> 61
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its consent.
(c) The Company need not reimburse any expense or indemnify
against any loss or liability incurred by the Trustee through negligence or bad
faith.
(d) To secure the payment obligations of the Company pursuant
to this Section, the Trustee shall have a lien prior to the Securities of any
series on all money or property held or collected by the Trustee, except that
held in trust to pay principal, premium, if any, and interest, if any, on
particular Securities.
(e) The provisions of this Section shall survive the
termination of this Indenture.
Section 6.10. Replacement of Trustee.
(a) The resignation or removal of the Trustee and the
appointment of a successor Trustee shall become effective only upon the
successor Trustee's acceptance of appointment as provided in Section 6.11
(b) The Trustee may resign at any time with respect to the
Securities of any series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 6.11 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
(c) The Holders of a majority in aggregate principal amount of
the Outstanding Securities of any series may remove the Trustee with respect to
that series by so notifying the Trustee and the Company and may appoint a
successor Trustee for such series with the Company's consent.
(d) If at any time:
(1) the Trustee fails to comply with Section 310(b)
of the Trust Indenture Act after written request therefor by the
Company or by any Holder who has been a bona fide Holder of a Security
for at least six months, or
(2) the Trustee shall cease to be eligible under
Section 310(a) of the Trust Indenture Act and shall fail to resign
after written request therefor by the Company or by any Holder of a
Security who has been a bona fide Holder of a Security for at least six
months; or
(3) the Trustee becomes incapable of acting, is
adjudged a bankrupt or an insolvent or a receiver or public officer
takes charge of the Trustee or its property or affairs for the purpose
of rehabilitation, conservation or liquidation,
54
<PAGE> 62
then, in any such case, (i) the Company may remove the Trustee with respect to
all Securities, or (ii) subject to Section 315(e) of the Trust Indenture Act,
any Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
(e) The Company may remove the Trustee with respect to the
Securities of any series at any time by giving written notice thereof to the
Trustee if there is at the time of such removal no Default with respect to the
Securities of such series.
(f) If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason, with respect to Securities of
one or more series, the Company shall promptly appoint a successor Trustee with
respect to the Securities of that or those series (it being understood that any
such successor Trustee may be appointed with respect to the Securities of one or
more or all of such series and that at any time there shall be only one Trustee
with respect to the Securities of any particular series) and shall comply with
the applicable requirements of Section 6.11. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
6.11, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any series shall have
been so appointed by the Company or the Holders of such Securities and accepted
appointment in the manner required by Section 6.11, the resigning or retiring
Trustee, or any Holder who has been a bona fide Holder of a Security of such
series for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
Section 6.11. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor
Trustee with respect to all Securities, every such successor Trustee shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment. Thereupon, the resignation or removal of
the retiring Trustee shall become effective, and the successor Trustee, without
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor
Trustee with respect to the Securities of one or more (but not all) series, the
Company, the retiring Trustee and each successor Trustee with respect to the
Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein such successor Trustee shall accept such appointment
and
55
<PAGE> 63
which (i) shall contain such provisions as shall be necessary or desirable to
transfer and confirm to, and to vest in, such successor Trustee all the rights,
powers, trusts and duties of the retiring Trustee with respect to the Securities
of that or those series to which the appointment of such successor Trustee
relates, (ii) if the retiring Trustee is not retiring with respect to all
Securities, shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series as to
which the retiring Trustee is not retiring shall continue to be vested in the
retiring Trustee, and (iii) shall add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Trustee, it being understood that
nothing herein or in such supplemental indenture shall constitute such Trustees
co-trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee and upon the execution and delivery of
such supplemental indenture the resignation or removal of the retiring Trustee
shall become effective to the extent provided therein and each such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee with respect
to the Securities of that or those series to which the appointment of such
successor Trustee relates; but, on request of the Company or any successor
Trustee, such retiring Trustee shall duly assign, transfer and deliver to such
successor Trustee all property and money held by such retiring Trustee hereunder
with respect to the Securities of that or those series to which the appointment
of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts
referred to in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be qualified and
eligible under the Trust Indenture Act.
(e) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
in the manner provided for notices to the Holders of Securities in Section 1.6.
Each notice shall include the name of the successor Trustee with respect to the
Securities of such series and the address of its Corporate Trust Office.
Section 6.12. Eligibility; Disqualification. There shall at
all times be a Trustee hereunder which shall be eligible to act as Trustee under
Section 310(a)(1) of the Trust Indenture Act and shall have a combined capital
and surplus of at least $50,000,000 (or having a combined capital and surplus in
excess of $5,000,000 and the obligations of which, whether now in existence or
hereafter incurred, are fully and unconditionally guaranteed by a corporation
organized and doing business under the laws of the United States, any State or
Territory thereof or of the District of Columbia and having a combined capital
and surplus of at least $50,000,000). If the Trustee or such corporation
publishes reports of condition at least annually, pursuant to law or the
requirements of Federal, State, Territorial or District of Columbia supervising
or examining authority, then for the purposes of this Section, the combined
capital and surplus of such the Trustee or corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
56
<PAGE> 64
so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article. If the
Trustee has or shall acquire any conflicting interest within the meaning of the
Trust Indenture Act, the Trustee shall comply with the relevant provisions
thereof.
Section 6.13. Merger, Conversion, Consolidation or Succession
to Business. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
Section 6.14. Appointment of Authenticating Agent. The Trustee
may appoint an Authenticating Agent or Agents with respect to one or more series
of Securities which shall be authorized to act on behalf of the Trustee to
authenticate Securities of such series issued upon original issue, exchange,
registration of transfer or partial redemption thereof, and Securities so
authenticated shall be entitled to the benefits of this Indenture and shall be
valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Any such appointment shall be evidenced by an instrument in writing
signed by a Responsible Officer of the Trustee, a copy of which instrument shall
be promptly furnished to the Company. Wherever reference is made in this
Indenture to the authentication and delivery of Securities by the Trustee or the
Trustee's certificate of authentication, such reference shall be deemed to
include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and, except as may otherwise be provided pursuant to
Section 3.1, shall at all times be a bank or trust company or corporation
organized and doing business and in good standing under the laws of the United
States of America or of any State or the District of Columbia, authorized under
such laws to act as Authenticating Agent. If such Authenticating Agent publishes
reports of condition at least annually, pursuant to law or the requirements of
such supervising or examining authority, then for the purposes of this Section,
the combined capital and surplus of such Authenticating Agent shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section, such Authenticating
Agent shall resign immediately in the manner and with the effect specified in
this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section,
57
<PAGE> 65
without the execution or filing of any paper or further act on the part of the
Trustee or the Authenticating Agent.
An Authenticating Agent for any series of Securities may at
any time resign by giving written notice of resignation to the Trustee for such
series and to the Company. The Trustee for any series of Securities may at any
time terminate the agency of an Authenticating Agent by giving written notice of
termination to such Authenticating Agent and to the Company. Upon receiving such
a notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee for such series may appoint a successor
Authenticating Agent which shall be acceptable to the Company and shall give
notice of such appointment to all Holders of Securities of the series with
respect to which such Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section.
The Company agrees to pay to each Authenticating Agent from
time to time reasonable compensation including reimbursement of its reasonable
expenses for its services under this Section.
If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to or in lieu of the Trustee's certificate of
authentication, an alternate certificate of authentication substantially in the
following form:
This is one of the Securities of a series issued under the
within-mentioned Indenture.
Dated:
BANK ONE, N.A., as Trustee
By
------------------------------------
as Authenticating Agent
By
------------------------------------
Authorized Signatory
Sections 6.2, 6.3, 6.5 and 6.9 shall be applicable to any Authenticating Agent.
Section 6.15. Trustee's Application for Instructions from the
Company. Any application by the Trustee for written instructions from the
Company may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. The Trustee shall not be liable for any action taken by, or omission
of, the Trustee in
58
<PAGE> 66
accordance with a proposal included in such application on or after the date
specified in such application (which date shall not be less than fifteen
Business Days after the date any officer of the Company actually receives such
application, unless any such officer shall have consented in writing to any
earlier date) unless prior to taking any such action (or the effective date in
the case of an omission), the Trustee shall have received written instructions
in response to such application specifying the action to be taken or omitted.
Section 6.16. Preferential Collection of Claims Against
Company. If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities or the coupons, if any), the Trustee
shall be subject to the provisions of the Trust Indenture Act regarding the
collection of claims against the Company (or any such other obligor).
ARTICLE 7
CONSOLIDATION, MERGER OR SALE BY THE COMPANY
Section 7.1. Consolidation, Merger or Sale of Assets by the
Company Permitted. The Company may not merge or consolidate with or into any
other corporation or sell, convey, transfer, lease or otherwise dispose of all
or substantially all of its assets to any Person, unless (i)(A) in the case of a
merger or consolidation, the Company is the surviving corporation or (B) in the
case of a merger or consolidation where the Company is not the surviving
corporation and in the case of any such sale, conveyance or other disposition,
the resulting, successor or acquiring Person is a corporation organized and
existing under the laws of the United States, any State or the District of
Columbia and such corporation expressly assumes by supplemental indenture all
the obligations of the Company under the Securities and any coupons appertaining
thereto and under this Indenture, (ii) immediately thereafter, giving effect to
such merger or consolidation, or such sale, conveyance, transfer, lease or other
disposition (including, without limitation, any indebtedness directly or
indirectly incurred or anticipated to be incurred in connection with or in
respect of such transactions), no Default or Event of Default shall have
occurred and be continuing and (iii) the Company has delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel each stating that such merger or
consolidation, or such sale, conveyance, transfer, lease or other disposition,
complies with this Article and that all conditions precedent relating to such
transaction have been complied with as herein provided.
Section 7.2. Successor Corporation Substituted. Upon any
merger or consolidation of the Company with or into any other corporation or any
sale, conveyance, transfer, lease or other disposition of all or substantially
all of the assets of the Company to any other Person, the successor corporation
formed by such consolidation or into which the Company is merged or the Person
to which such conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor Person had been named
as the Company herein, and thereafter, except in the case of a lease to another
Person, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.
59
<PAGE> 67
ARTICLE 8
SUPPLEMENTAL INDENTURES
Section 8.1. Supplemental Indentures without Consent of
Holders. Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form reasonably satisfactory
to the Trustee, for any of the following purposes:
(1) to evidence the succession of another corporation
to the Company and the assumption by any such successor of the
covenants of the Company herein and in the Securities; or
(2) to add to the covenants of the Company for the
benefit of the Holders of all or any series of Securities (and if such
covenants are to be for the benefit of less than all series of
Securities, stating that such covenants are expressly being included
solely for the benefit of such series) or to surrender any right or
power herein conferred upon the Company; or
(3) to add any additional Events of Default with
respect to all or any series of Securities; or
(4) to add to or change any of the provisions of this
Indenture to such extent as shall be necessary to facilitate the
issuance of Bearer Securities (including, without limitation, to
provide that Bearer Securities may be registrable as to principal only)
or to facilitate the issuance of Securities in global form, provided
that any such action shall not adversely affect the interests of the
Holders of Securities of any series or any related coupons in any
material respect; or
(5) to add to, change or eliminate any of the
provisions of this Indenture, provided that any such addition, change
or elimination shall become effective only when there is no Security
Outstanding of any series created prior to the execution of such
supplemental indenture which is entitled to the benefit of such
provision and as to which such supplemental indenture would apply; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of
any series as permitted by Sections 2.1 and 3.1; or
(8) to evidence and provide for the acceptance of
appointment hereunder by a successor Trustee with respect to the
Securities of one or more series and to add to or change any of the
provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one
Trustee, pursuant to the requirements of Section 6.10; or
60
<PAGE> 68
(9) if allowed without penalty under applicable laws
and regulations, to permit payment in the United States (including any
of the states and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction of principal,
premium, if any, or interest, if any, on Bearer Securities or coupons,
if any; or
(10) to correct or supplement any provision herein
which may be inconsistent with any other provision herein or to make
any other provisions with respect to matters or questions arising under
this Indenture, provided such action shall not adversely affect the
interest of the Holders of Securities of any series in any material
respect, or to cure any ambiguity or correct any mistake; or
(11) to supplement any of the provisions of this
Indenture to such extent as shall be necessary to permit or facilitate
the defeasance and discharge of any series of Securities pursuant to
Article 4, provided that any such action shall not adversely affect the
interests of the Holders of Securities of such series or any other
series of Securities or any related coupons in any material respect.
Section 8.2. Supplemental Indentures with Consent of Holders.
With the written consent of the Holders of not less than a majority of the
aggregate principal amount of the Outstanding Securities of each series
adversely affected by such supplemental indenture, the Company and the Trustee
may enter into an indenture or indentures supplemental hereto to add any
provisions to or to change or eliminate any provisions of this Indenture or of
any other indenture supplemental hereto or to modify the rights of the Holders
of Securities of each such series; provided, however, that without the consent
of the Holder of each Outstanding Security affected thereby, an amendment under
this Section may not:
(1) change the Stated Maturity of the principal of,
or any installment of principal of or interest on, any Security, or
reduce the principal amount thereof or the rate of interest thereon or
any premium payable upon the redemption thereof, or reduce the amount
of the principal of an Original Issue Discount Security that would be
due and payable upon a declaration of acceleration of the Maturity
thereof pursuant to Section 5.2, or change the coin or currency in
which any Securities or any premium or interest thereon is payable, or
impair the right to institute suit for the enforcement of any such
payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date);
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver (of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture;
(3) change any obligation of the Company to maintain
an office or agency in the places and for the purposes specified in
Section 9.2; or
61
<PAGE> 69
(4) make any change in Section 5.7 or this Section
8.2 except to increase any percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the
consent of the Holders of each Outstanding Security affected thereby.
A supplemental indenture that changes or eliminates any
covenant or other provision of this Indenture, which has expressly been included
solely for the benefit of one or more particular series of Securities, or that
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series.
Upon the request of the Company, accompanied by a copy of a
Board Resolution authorizing the execution of any such supplemental indenture,
and upon the filing with the Trustee of evidence of the consent of the Holders
as aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture. It is not necessary under this Section 8.2 for the
Holders to consent to the particular form of any proposed supplemental
indenture, but it is sufficient if they consent to the substance thereof.
Section 8.3. Compliance with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall comply with the
requirements of the Trust Indenture Act as then in effect.
Section 8.4. Execution of Supplemental Indentures. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modification thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and shall
be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture. The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
Section 8.5. Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article, this Indenture shall
be modified in accordance therewith, and such supplemental indenture shall form
a part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder and of any
coupon appertaining thereto shall be bound thereby.
Section 8.6. Reference in Securities to Supplemental
Indentures. Securities, including any coupons, of any series authenticated and
delivered after the execution of any supplemental indenture pursuant to this
Article may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
indenture. If the Company shall so determine, new Securities including any
coupons of any series so modified as to conform, in the opinion of the Trustee
and the Company, to any such supplemental indenture may be prepared and executed
by the Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities including any coupons of such series.
62
<PAGE> 70
Section 8.7. Notice of Supplemental Indenture. Promptly after
the execution by the Company and the appropriate Trustee of any supplemental
indenture pursuant to Section 8.2, the Company shall transmit, in the manner and
to the extent provided in Section 1.6, to all Holders of any series of the
Securities affected thereby, a notice setting forth in general terms the
substance of such supplemental indenture.
ARTICLE 9
COVENANTS
Section 9.1. Payment of Principal, Premium, if Any, and
Interest, if Any. The Company covenants and agrees for the benefit of the
Holders of each series of Securities that it will duly and punctually pay the
principal of, premium, if any, and interest, if any, on the Securities of that
series in accordance with the terms of the Securities of such series, any
coupons appertaining thereto and this Indenture. An installment of principal or
interest shall be considered paid on the date it is due if the Trustee or Paying
Agent holds on that date money designated for and sufficient to pay the
installment. Unless otherwise specified as contemplated by Section 3.1 with
respect to any series of Securities or except as otherwise provided in Section
3.7, any interest due on Bearer Securities on or before Maturity shall be
payable only upon presentation and surrender of the several coupons for such
interest installments as are evidenced thereby as they severally mature. If so
provided in the terms of any series of Securities established as provided in
Section 3.1, the interest, if any, due in respect of any temporary Securities in
global form or definitive Security in global form, together with any additional
amounts payable in respect thereof, as provided in the terms and conditions of
such Security, shall be payable only upon presentation of such Security to the
Trustee for notation thereon of the payment of such interest.
Section 9.2. Maintenance of Office or Agency. If Securities of
a series are issued as Registered Securities, the Company will maintain in each
Place of Payment for any series of Securities an office or agency where
Securities of that series may be presented or surrendered for payment, where
Securities of that series may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company in respect of the
Securities of that series and this Indenture may be served. If Securities of a
series are issuable as Bearer Securities, the Company will maintain, (i) subject
to any laws or regulations applicable thereto, an office or agency in a Place of
Payment for that series which is located outside the United States, where
Securities of that series and related coupons may be presented and surrendered
for payment; provided, however, that if the Securities of that series are listed
on any stock exchange located outside the United States and such stock exchange
shall so require, the Company will maintain a Paying Agent for the Securities of
that series in any required city located outside the United States, as the case
may be, so long as the Securities of that series are listed on such exchange,
and (ii) subject to any laws or regulations applicable thereto, in a Place of
Payment for that series located outside the United States, where Securities of
that series may be surrendered for exchange and where notices and demands to or
upon the Company in respect of the Securities of that series and this Indenture
may be served. The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of any such office or agency. If at
any time the Company shall fail to maintain any such required office or agency
or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office
63
<PAGE> 71
of the Trustee, and the Company hereby appoints the Trustee as its agent to
receive all such presentations, surrenders, notices and demands.
Unless otherwise specified as contemplated by Section 3.1, no
payment of principal, premium or interest on Bearer Securities shall be made at
any office or agency of the Company in the United States, by check mailed to any
address in the United States, by transfer to an account located in the United
States or upon presentation or surrender in the United States of a Bearer
Security or coupon for payment, even if the payment would be credited to an
account located outside the United States; provided, however, that, if the
Securities of a series are denominated and payable in Dollars, payment of
principal of and any premium or interest on any such Bearer Security shall be
made at the office of the Company's Paying Agent in the Borough of Manhattan,
The City of New York, if (but only if) payment in Dollars of the full amount of
such principal, premium or interest, as the case may be, at all offices or
agencies outside the United States maintained for the purpose of the Company in
accordance with this Indenture is illegal or effectively precluded by exchange
controls or other similar restrictions.
The Company may also from time to time designate one or more
other offices or agencies where the Securities (including any coupons, if any)
of one or more series may be presented or surrendered for any or all such
purposes and may from time to time rescind any such designation; 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 each Place of
Payment for Securities (including any coupons, if any) of any series for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other
office or agency.
Unless otherwise specified as contemplated by Section 3.1, the
Trustee shall initially serve as Paying Agent.
Section 9.3. Money for Securities to Be Held in Trust;
Unclaimed Money. If the Company shall at any time act as its own Paying Agent
with respect to any series of Securities, it will, on or before each due date of
the principal of, premium, if any, or interest on any of the Securities of that
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal, premium, if any, or interest, if
any, so becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided and will promptly notify the Trustee in writing
of its action or failure so to act.
The Company will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(1) hold all sums held by it for the payment of the
principal of, premium, if any, or interest, if any, on Securities of
that series in trust for the benefit of the Persons entitled thereto
until such sums shall be paid to such Persons or otherwise disposed of
as herein provided;
64
<PAGE> 72
(2) give the Trustee notice of any default by the
Company (or any other obligor upon the Securities of that series) in
the making of any payment of principal, premium, if any, or interest,
if any, on the Securities;
(3) at any time during the continuance of any such
default, upon the written request of the Trustee, forthwith pay to the
Trustee all sums so held in trust by such Paying Agent; and
(4) acknowledge, accept and agree to comply in all
respects with the provisions of this Indenture relating to the duties,
rights and disabilities of the Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company in trust for the payment of any principal, premium, if
any, or interest, if any, on any Security of any series and remaining unclaimed
for two years after such principal, premium, if any, or interest, if any, has
become due and payable shall be paid to the Company on Company Request or (if
then held by the Company) shall be discharged from such trust; and the Holder of
such Security and coupon, if any, shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money, and all liability
of the Company as trustee thereof, shall thereupon cease; provided, however,
that the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in a
newspaper published in the English language, customarily published on each
Business Day and of general circulation in The City of New York, or cause to be
mailed to such Holder, notice that such money remains unclaimed and that, after
a date specified therein, which shall not be less than 30 days from the date of
such publication, any unclaimed balance of such money then remaining will be
repaid to the Company.
Section 9.4. Corporate Existence. Subject to Article 7, the
Company will at all times do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence and its
rights and franchises; provided that nothing in this Section 9.4 shall prevent
the abandonment or termination of any right or franchise of the Company, if, in
the opinion of the Company, such abandonment or termination is in the best
interests of the Company and does not materially adversely affect the ability of
the Company to operate its business or to fulfill its obligations hereunder.
65
<PAGE> 73
Section 9.5. Reports by the Company. The Company covenants:
(a) to file with the Trustee, within 30 days after the Company
is required to file the same with the Commission, copies of the annual reports
and of the information, documents and other reports (or copies of such portions
of any of the foregoing as the Commission may from time to time by rules and
regulations prescribe) which it may be required to file with the Commission
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934,
as amended; or if it is not required to file information, documents or reports
pursuant to either of such sections, then to file with the Trustee and the
Commission, in accordance with rules and regulations prescribed from time to
time by the Commission, such of the supplementary and periodic information,
documents and reports which may be required pursuant to Section 13 of the
Securities Exchange Act of 1934, as amended, in respect of a Security listed and
registered on a national securities exchange as may be prescribed from time to
time in such rules and regulations;
(b) to file with the Trustee and the Commission, in accordance
with the rules and regulations prescribed from time to time by the Commission,
such additional information, documents and reports with respect to compliance by
it with the conditions and covenants contained or provided for in this
Indenture, as may be required from time to time by such rules and regulations;
and
(c) to transmit to all Holder of Securities, within 30 days
after the filing thereof with the Trustee, in the manner and to the extent
provided in Section 313(c) of the Trust Indenture Act, such summaries of any
information, documents and reports required to be filed by it pursuant to
subsections (a) and (b) of this Section 9.5, as may be required by rules and
regulations prescribed from time to time by the Commission.
Section 9.6. Annual Review Certificate; Notice of Default. The
Company covenants and agrees to deliver to the Trustee, within 120 days after
the end of each fiscal year of the Company, a brief certificate from the
principal executive officer, principal financial officer, or principal
accounting officer as to his or her knowledge of the Company's compliance with
all conditions and covenants under this Indenture. For purposes of Section 9.7,
such compliance shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture. The Company shall file with
the Trustee written notice of occurrence of any Event of Default within thirty
Business Days of its becoming aware of any such Event of Default.
Section 9.7. Waiver of Certain Covenants and Conditions. The
Company may omit in any particular instance to comply with any term, covenant,
provision or condition set forth in Sections 9.4 through 9.6, inclusive, or
established pursuant to Section 3.1 with respect to the Securities of any series
if before or after the time for such compliance the Holders of not less than a
majority in principal amount of the Outstanding Securities of such series shall,
by Act of such Holders, either waiver such compliance in such instance or
generally waive compliance with such term, covenant, provision or condition, but
no such waiver shall extend to or affect such term, covenant, provision or
condition except to the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company and the duties of the Trustee
in respect of any such term, covenant, provision or condition shall remain in
full force and effect.
66
<PAGE> 74
ARTICLE 10
REDEMPTION
Section 10.1. Applicability of Article. Securities (including
coupons, if any) of any series which are redeemable before their Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 3.1 for Securities of any series) in
accordance with this Article.
Section 10.2. Election to Redeem; Notice to Trustee. The
election of the Company to redeem any Securities, including coupons, if any,
shall be evidenced by a Board Resolution or, in the case of an election made
pursuant to authority granted in a Board Resolution, an Officer's Certificate.
In the case of any redemption at the election of the Company of less than all
the Securities of coupons, if any, of any series, the Company shall, at least 60
days prior to the Redemption Date fixed by the Company (unless a shorter notice
shall be satisfactory to the Trustee), notify the Trustee of such Redemption
Date, of the principal amount of Securities of such series to be redeemed and,
if applicable, to the tenor of the Securities to be redeemed. In the case of any
redemption of Securities (i) prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or elsewhere in this
Indenture or (ii) pursuant to an election of the Company which is subject to a
condition specified in the terms of such Securities, the Company shall furnish
the Trustee with an Officer's Certificate evidencing compliance with such
restriction or condition.
Section 10.3. Selection of Securities To Be Redeemed. Unless
otherwise specified as contemplated by Section 3.1, if less than all the
Securities (including coupons, if any) of a series with the same original issue
date, interest rate and Stated Maturity are to be redeemed, the Trustee, not
more than 45 days prior to the Redemption Date, shall select the Securities of
the series to be redeemed in such manner as the Trustee shall deem fair and
appropriate. The Trustee shall make the selection from Securities of the series
that are Outstanding and that have not previously been called for redemption and
may provide for the selection for redemption of portions (equal to the minimum
authorized denomination for Securities including coupons, if any, of that series
or any integral multiple thereof) of the principal amount of Securities,
including coupons, if any, of such series of a denomination larger than the
minimum authorized denomination for Securities of that series. The Trustee shall
promptly notify the Company in writing of the Securities selected by the Trustee
for redemption and, in the case of any Securities selected for partial
redemption, the principal amount thereof to be redeemed.
For purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities (including
coupons, if any) shall relate, in the case of any Securities (including coupons,
if any) redeemed or to be redeemed only in part, to the portion of the principal
amount of such Securities (including coupons, if any) which has been or is to be
redeemed.
Section 10.4. Notice of Redemption. Unless otherwise specified
as contemplated by Section 3.1, notice of redemption shall be given in the
manner provided in Section 1.6 not less
67
<PAGE> 75
than 30 days nor more than 60 days prior to the Redemption Date to the Holders
of the Securities to be redeemed.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) if less than all the Outstanding Securities of a
series are to be redeemed, the identification (and, in the case of
partial redemption, the principal amounts) of the particular Security
or Securities to be redeemed;
(4) in case any Security is to be redeemed in part
only, the notice which relates to such Security shall state that on and
after the Redemption Date, upon surrender of such Security, the Holder
will receive, without a charge, a new Security or Securities of
authorized denominations for the principal amount thereof remaining
unredeemed;
(5) the Place or Places of Payment where such
Securities, together in the case of Bearer Securities with all coupons
appertaining thereto, if any, maturing after the Redemption Date, are
to be surrendered for payment for the Redemption Price;
(6) that Securities of the series called for
redemption and all unmatured coupons, if any, appertaining thereto must
be surrendered to the Paying Agent to collect the redemption price;
(7) that, on the Redemption Date, the Redemption
Price will become due and payable upon each such Security, or the
portion thereof, to be redeemed and, if applicable, that interest
thereon will cease to accrue on and after said date;
(8) that the redemption is for a sinking fund, if
such is the case;
(9) that, unless otherwise specified in such notice,
Bearer Securities of any series, if any, surrendered for redemption
must be accompanied by all coupons maturing subsequent to the
Redemption Date or the amount of any such missing coupon or coupons
will be deducted from the Redemption Price, unless security or
indemnity satisfactory to the Company, the Trustee and any Paying Agent
is furnished; and
(10) CUSIP number (if any).
Notice of redemption of Securities to be redeemed shall be
given by the Company or, at the Company's request, by the Trustee in the name
and at the expense of the Company.
Section 10.5. Deposit of Redemption Price. On or prior to
12:00 Noon New York City time on any Redemption Date, the Company shall deposit
with the Trustee or with a Paying
68
<PAGE> 76
Agent (or, if the Company is acting as its own Paying Agent, segregate and hold
in trust as provided in Section 9.3) an amount of money in the currency or
currencies (including currency units or composite currencies) in which the
Securities of such series are payable (except as otherwise specified pursuant to
Section 3.1 for the Securities of such series) sufficient to pay on the
Redemption Date the Redemption Price of, and (unless the Redemption Date shall
be an Interest Payment Date) interest, if any, accrued to the Redemption Date
on, all Securities or portions thereof which are to be redeemed on that date.
Unless any Security by its terms prohibits any sinking fund
payment obligation from being satisfied by delivering and crediting Securities
(including Securities redeemed otherwise than through a sinking fund), the
Company may deliver such Securities to the Trustee for crediting against such
payment obligation in accordance with the terms of such Securities and this
Indenture.
Section 10.6. Securities Payable on Redemption Date. Notice of
redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest, if any)
such Securities shall cease to bear interest and the coupons for any such
interest appertaining to any Bearer Security so to be redeemed, except to the
extent provided below, shall be void. Except as provided in the next succeeding
paragraph, upon surrender of any such Security, including coupons, if any, for
redemption in accordance with said notice, such Security shall be paid by the
Company at the Redemption Price, together with accrued interest, if any, to the
Redemption Date; provided, however, that installments of interest, if any, on
Bearer Securities whose Stated Maturity is on or prior to the Redemption Date
shall be payable only at an office or agency located outside the United States
and its possessions (except as otherwise provided in Section 9.2) and, unless
otherwise specified as contemplated by Section 3.1, only upon presentation and
surrender of coupons for such interest; and provided further that, unless
otherwise specified as contemplated by Section 3.1, installments of interest, if
any, on Registered Securities whose Stated Maturity is prior to the Redemption
Date shall be payable to the Holder of such Securities, or one or more
Predecessor Securities, registered as such at the close of business on the
relevant Record Dates according to their terms and the provisions of Section
3.7.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant coupons maturing after the Redemption Date, such
Bearer Security may be paid after deducting from the Redemption Price an amount
equal to the face amount of all such missing coupons, or the surrender of such
missing coupon or coupons may be waived by the Company and the Trustee if there
be furnished to them such security or indemnity as they may require to save each
of them and any Paying Agent harmless. If thereafter the Holder of such Bearer
Security shall surrender to the Trustee or any Paying Agent any such missing
coupon in respect of which a deduction shall have been made from the Redemption
Price, such Holder shall be entitled to receive the amount so deducted;
provided, however, that interest represented by coupons shall be payable only at
an office or agency located outside of the United States (except as otherwise
provided pursuant to Section 9.2) and, unless otherwise specified as
contemplated by Section 3.1, only upon presentation and surrender of those
coupons.
69
<PAGE> 77
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate, if any,
prescribed therefor in the Security.
Section 10.7. Securities Redeemed in Part. Upon surrender of a
Security that is redeemed in part at any Place of Payment therefor (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing), the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
that Security, without service charge, a new Security or Securities of the same
series and of like tenor with the same form and the same Maturity in any
authorized denomination equal in aggregate principal amount to the unredeemed
portion of the principal of the Security surrendered; provided, however, that
the Depositary need not surrender a Security in global form for a partial
redemption and may be authorized to make a notation on such Security of such
partial redemption. In the case of a partial redemption of a Security in global
form, the Depositary, and in turn, the participants in the Depositary, shall
have the responsibility to select any Securities to be redeemed by random lot.
ARTICLE 11
SINKING FUNDS
Section 11.1. Applicability of Article. The provisions of this
Article shall be applicable to any sinking fund for the retirement of Securities
of a series except as otherwise specified as contemplated by Section 3.1 for
Securities of such series.
The minimum amount of any sinking fund payment provided for by
the terms of Securities of any series is herein referred to as a "mandatory
sinking fund payment," and any payment in excess of such minimum amount provided
for by the terms of Securities of any series is herein referred to as an
"optional sinking fund payment." If provided for by the terms of Securities of
any series, the cash amount of any sinking fund payment may be subject to
reduction as provided in Section 11.2. Each sinking fund payment shall be
applied to the redemption of Securities of any series as provided for by the
terms of Securities of such series.
Section 11.2. Satisfaction of Sinking Fund Payments with
Securities. The Company (i) may deliver Outstanding Securities of a series
(other than any previously called for redemption) together, in the case of
Bearer Securities of such series, with all unmatured coupons appertaining
thereto and (ii) may apply as a credit Securities of a series which have been
redeemed either at the election of the Company pursuant to the terms of such
Securities or through the application of permitted optional sinking fund
payments pursuant to the terms of such Securities, in each case in satisfaction
of all or any part of any sinking fund payment with respect to the Securities of
such series required to be made pursuant to the terms of such Securities as
provided for by the terms of such series; provided that such Securities have not
been previously so credited. Such Securities shall be received and credited for
such purpose by the Trustee at the Redemption Price specified in such Securities
for redemption through operation of the sinking fund and the amount of such
sinking fund payment shall be reduced accordingly.
70
<PAGE> 78
Section 11.3. Redemption of Securities for Sinking Fund. Not
less than 60 days prior to each sinking fund payment date for any series of
Securities (unless a shorter period shall be satisfactory to the Trustee), the
Company will deliver to the Trustee an Officer's Certificate specifying the
amount of the next ensuing sinking fund payment for that series pursuant to the
terms of that series, the portion thereof, if any, which is to be satisfied by
payment of cash and the portion thereof, if any, which is to be satisfied by
delivering and crediting Securities of that series pursuant to Section 11.2 and
will also deliver to the Trustee any Securities to be so delivered. Not less
than 30 days before each such sinking fund payment date, the Trustee shall
select the Securities to be redeemed upon such sinking fund payment date in the
manner specified in Section 10.3 and cause notice of the redemption thereof to
be given in the name of and at the expense of the Company in the manner provided
in Section 10.4. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
10.6 and 10.7.
-------------------
This Indenture may be executed in any number of counterparts,
each of which shall be an original, but such counterparts shall together
constitute but one instrument.
(Remainder of this page left blank)
71
<PAGE> 79
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
CONTINENTAL AIRLINES, INC.,
as Issuer
By /s/ JENNIFER L. VOGEL
-------------------------------
Title: Jennifer L. Vogel
---------------------------
Vice President - Legal
Attest:
-------------------------------
Title:
--------------------------------
BANK ONE, N.A., as Trustee
By /s/ DAVID B. KNOX
-------------------------------
Title: Authorized Signer
---------------------------
Attest:
-------------------------------
Title:
--------------------------------
<PAGE> 1
EXHIBIT 12.1
CONTINENTAL AIRLINES, INC.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(IN MILLIONS)
<TABLE>
<CAPTION>
Nine Months Nine Months 4/28/93 | 1/1/93
Ended Ended through | through
9/30/98 9/30/97 1997 1996 1995 1994 12/31/93 | 4/27/93 1992
------------------------- ---- ---- ---- ---- -------- | ------- ------
<S> <C> <C> <C> <C> <C> <C> <C> | <C> <C>
Earnings: |
Earnings (Loss) Before Income |
Taxes, Minority Interest and |
Extraordinary Items $537 $518 $639 $428 $310 $(651) $ (52) | $(977) $(125)
|
Plus: |
Interest Expense(a) 130 126 166 165 213 241 165 | 52 153
Capitalized Interest (41) (23) (35) (5) (6) (17) (8) | (2) (6)
Amortization of Capitalized |
Interest 3 3 3 3 2 1 0 | 0 0
Portion of Rent Expense |
Representative of Interest |
Expense(a) 340 289 400 359 360 337 216 | 117 324
---- ---- ----- ---- ---- ----- ----- | ----- -----
969 913 1,173 950 879 (89) 321 | (810) 346
---- ---- ----- ---- ---- ----- ----- | ----- -----
Fixed Charges: |
Interest Expense(a) 130 126 166 165 213 241 165 | 52 153
Portion of Rent Expense |
Representative of Interest |
Expense(a) 340 289 400 359 360 337 216 | 117 324
---- ---- ----- ---- ---- ----- ----- | ----- -----
Total Fixed Charges 470 415 566 524 573 578 381 | 169 477
---- ---- ----- ---- ---- ----- ----- | ----- -----
Coverage Adequacy (Deficiency) $499 $498 $ 607 $426 $306 $(667) $ (60) | $(979) $(131)
==== ==== ===== ==== ==== ===== ===== | ===== =====
Coverage Ratio 2.06 2.20 2.07 1.81 1.53 n/a n/a | n/a n/a
==== ==== ===== ==== ==== ===== ===== | ===== =====
</TABLE>
Note: A vertical black line is shown in the table above to separate
Continental's post-reorganized consolidated financial data
of Holdings since they have not been prepared on a consistent
basis of accounting.
(a) Includes Fair Market Value Adjustments resulting from the
Company's emergence from bankruptcy.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 333-29255) and related Prospectus of
Continental Airlines, Inc. (the "Company") for the registration of $200,000,000
of 8% Senior Notes due 2005 and to the incorporation by reference therein to
our report dated February 9, 1998 (except for Note 13, as to which the date is
March 18, 1998) with respect to the consolidated financial statements and our
report dated March 18, 1998 with respect to the related financial statement
schedule of the Company included in its Annual Report (Form 10-K) for the year
ended December 31, 1997, filed with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
Houston, Texas
December 7, 1998
