<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 26, 1996
REGISTRATION NO. 333-15953
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- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
NIKE, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
----------------
OREGON 1-10635 93-0584541
(STATE OR OTHER (COMMISSION FILE NO.) (I.R.S. EMPLOYER
JURISDICTION OF IDENTIFICATION NO.)
INCORPORATION OR
ORGANIZATION)
----------------
ONE BOWERMAN DRIVE
BEAVERTON, OREGON 97005-6453
(503) 671-6453
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
----------------
ROBERT S. FALCONE
VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
ONE BOWERMAN DRIVE
BEAVERTON, OREGON 97005-6453
(503) 671-6453
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
----------------
COPIES TO:
TRACY K. EDMONSON
GREGORY K. MILLER
LATHAM & WATKINS
505 MONTGOMERY STREET
SAN FRANCISCO, CALIFORNIA 94111
TELEPHONE: (415) 391-0600
FAX: (415) 395-8095
----------------
APPROXIMATE DATE OF COMMENCEMENT OF THE PROPOSED SALE TO THE PUBLIC: From
time to time after this Registration Statement becomes effective.
----------------
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box: [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act of 1933, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
----------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
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<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY, NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED NOVEMBER 26, 1996
$500,000,000
[NIKE LOGO APPEARS HERE]
NIKE, INC.
DEBT SECURITIES
-----------
NIKE, Inc. ("NIKE" or the "Company") may offer from time to time its debt
securities in one or more series (the "Debt Securities") at an aggregate
initial offering price not to exceed $500,000,000 or its equivalent in another
currency or composite currency. Unless otherwise specified in one or more
supplements (a "Prospectus Supplement") to this Prospectus, the Debt Securities
will be direct, unsecured obligations of NIKE and will rank equally with all
other unsecured, unsubordinated indebtedness of NIKE.
The Debt Securities will be offered to the public on terms determined by
market conditions at the time of sale. The Debt Securities may be offered to
the public as separate series and may be offered in amounts, at prices and on
terms to be determined at the time of sale and to be set forth in one or more
Prospectus Supplements. The specific terms of the Debt Securities in respect of
which this Prospectus is being delivered, including, where applicable,
aggregate principal amount, maturity (which may be fixed or extendible),
interest rate or rates (which may be fixed or variable), if any, the time of
payment of interest, if any, authorized denominations (which may be in United
States dollars, in any other currency or in a composite currency), initial
public offering price, purchase price, any terms for a sinking fund or for
redemption at the option of NIKE or the holder, any listing on a securities
exchange and other terms with respect to such Debt Securities, will be set
forth in a Prospectus Supplement and/or a related Pricing Supplement which will
be delivered with this Prospectus. Debt Securities may be issued as Discount
Securities to be sold at a discount below their principal amount and, if
issued, certain terms thereof will be set forth in the Prospectus Supplement
related thereto. See "Description of Debt Securities".
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURI-
TIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS OR ANY SUPPLEMENT
HERETO. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------
The Debt Securities may be offered directly to purchasers or to or through
underwriters, dealers or agents. If an agent of NIKE or a broker-dealer or
underwriter is involved in the sale of the Debt Securities in respect of which
this Prospectus is being delivered, the names of such agent, broker-dealer or
underwriter and the agent's commission or broker-dealer's or underwriter's
discount will be set forth in the Prospectus Supplement. The proceeds to NIKE
will be the purchase price in the case of sale through an agent or a broker-
dealer and the public offering price in the case of sale through an
underwriter. Net proceeds to NIKE will be the purchase price less commission in
the case of an agent and the public offering price less discount in the case of
an underwriter, less, in each case, other issuance expenses. See "Plan of
Distribution".
The date of this Prospectus is , 1996.
<PAGE>
AVAILABLE INFORMATION
NIKE is subject to the informational requirements of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and in accordance therewith
files reports, proxy statements and other information with the Securities and
Exchange Commission (the "Commission"). Such reports, proxy statements and
other information may be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C., and at the Commission's regional offices at Seven World
Trade Center, Suite 1300, New York, New York and at Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois, and copies may be obtained at
prescribed rates from the Public Reference Section of the Commission at its
principal office at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549.
Such reports, proxy statements and other information may also be inspected and
copied at the offices of the New York Stock Exchange, 20 Broad Street, New
York, New York and at the offices of the Pacific Stock Exchange, 301 Pine
Street, San Francisco, California. The Commission also maintains a site on the
World Wide Web at "http://www.sec.gov" that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the Commission.
NIKE has filed with the Commission a Registration Statement on Form S-3 (the
"Registration Statement") under the Securities Act of 1933 (the "Securities
Act"), with respect to the Debt Securities offered hereby. This Prospectus,
which constitutes part of the Registration Statement, omits certain of the
information contained in the Registration Statement and the exhibits and
schedules thereto on file with the Commission pursuant to the Securities Act
and the rules and regulations of the Commission thereunder. In addition,
certain documents filed by NIKE with the Commission have been incorporated by
reference in this Prospectus. See "Incorporation of Certain Documents by
Reference". The Registration Statement, including exhibits and schedules
thereto and such incorporated documents, may be inspected and copied at the
public reference facilities maintained by the Commission at its principal
office in Washington, D.C. or at its regional offices. Statements contained in
this Prospectus as to the contents of any contract or other document referred
to are not necessarily complete and in each instance reference is made to the
copy of such contract or other document filed as an exhibit to the
Registration Statement, each such statement being qualified in all respects by
such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The documents listed below have been filed by NIKE with the Commission
pursuant to the Exchange Act and are hereby incorporated by reference in this
Prospectus:
a. NIKE's Annual Report on Form 10-K for the fiscal year ended May 31,
1996, as amended by its Form 10-K/A dated August 29, 1996;
b. NIKE's Quarterly Report on Form 10-Q for the fiscal quarter ended August
31, 1996;
c. NIKE's Current Report on Form 8-K dated July 9, 1996; and
d. NIKE's Current Report on Form 8-K dated September 16, 1996.
Each document filed by NIKE pursuant to Sections 13(a), 13(c), 14 and 15(d)
of the Exchange Act subsequent to the date of this Prospectus and prior to the
termination of the offering of all Debt Securities to which this Prospectus
relates shall be deemed to be incorporated by reference in this Prospectus and
to be part hereof from the date of filing such documents.
Any statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained
herein (or in the applicable Prospectus Supplement) or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein
2
<PAGE>
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Copies of all documents which are incorporated herein by reference (not
including the exhibits to such documents, unless such exhibits are
specifically incorporated by reference in such documents) will be provided
without charge to each person, including any beneficial owner, to whom this
Prospectus (or the applicable Prospectus Supplement) is delivered upon written
or oral request. Requests for such documents should be directed to NIKE, Inc.,
One Bowerman Drive, Beaverton, Oregon 97005-6453, Attention: Investor
Relations (telephone: (503) 671-6453).
THE COMPANY
NIKE, Inc.'s principal business activity involves the design, development
and worldwide marketing of high quality footwear, apparel and accessory
products. NIKE sells its products to approximately 18,000 retail accounts in
the United States and through a mix of independent distributors, licensees and
subsidiaries in approximately 110 countries around the world. Virtually all of
NIKE's products are manufactured by independent contractors. Most footwear
products are produced outside the United States, while apparel products are
produced both in the United States and abroad.
NIKE, Inc., was incorporated in 1968 under the laws of the state of Oregon.
As used herein and in any Prospectus Supplement, the terms "NIKE" and the
"Company" refer to NIKE, Inc. and its predecessors, subsidiaries and
affiliates, unless the context indicates otherwise. NIKE's principal executive
offices are located at One Bowerman Drive, Beaverton, Oregon 97005-6453 and
its telephone number is (503) 671-6453.
USE OF PROCEEDS
Except as may be set forth in the Prospectus Supplement, NIKE intends to use
the net proceeds from the sale of the Debt Securities for general corporate
purposes, including, without limitation, working capital, capital
expenditures, investments in subsidiaries and refinancing of debt.
3
<PAGE>
SELECTED FINANCIAL DATA
The selected consolidated financial data shown below for, and as of the end
of, each of the years in the five-year period ended May 31, 1996 have been
derived from NIKE's consolidated financial statements, which have been audited
by Price Waterhouse LLP, independent accountants, and which have been
incorporated in this Prospectus by reference. The selected consolidated
financial data should be read in conjunction with NIKE's Consolidated Financial
Statements, incorporated herein by reference.
<TABLE>
<CAPTION>
FISCAL YEAR ENDED MAY 31,
----------------------------------------------------------
1992 1993 1994 1995 1996
---------- ---------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
STATEMENT OF INCOME
DATA:
Revenues............... $3,405,211 $3,930,984 $3,789,668 $4,760,834 $6,470,625
Gross margin........... 1,316,122 1,543,991 1,488,245 1,895,554 2,563,879
Gross margin as a
percentage of
Revenues.............. 38.7% 39.3% 39.3% 39.8% 39.6%
Selling, general and
administrative
expenses.............. 761,498 922,261 974,099 1,209,760 1,588,612
Selling, general and
administrative
expenses as a
percentage of
Revenues.............. 22.4% 23.5% 25.7% 25.4% 24.6%
Net income............. 329,218 365,016 298,794 399,664 553,190
BALANCE SHEET DATA
(PERIOD END):
Cash and equivalents... 260,050 291,284 518,816 216,071 262,117
Inventories............ 471,202 592,986 470,023 629,742 931,151
Working capital........ 964,291 1,165,204 1,208,444 938,393 1,259,881
Total assets........... 1,871,667 2,186,269 2,373,815 3,142,745 3,951,628
Short-term debt(1)..... 162,648 218,692 249,509 558,523 689,778
Long-term debt......... 69,476 15,033 12,364 10,565 9,584
Common shareholders'
equity................ 1,328,488 1,642,819 1,740,949 1,964,689 2,431,400
OTHER DATA:
Cash flow from
operations............ 435,838 265,292 576,463 254,913 330,021
Ratio of earnings to
fixed charges(2)...... 14.27 16.80 18.44 17.67 16.53
GEOGRAPHIC REVENUES:
United States.......... $2,270,880 $2,528,848 $2,432,684 $2,997,864 $3,964,662
Europe................. 919,763 1,085,683 927,269 980,444 1,334,340
Asia/Pacific........... 75,732 178,196 283,421 515,652 735,094
Canada, Latin America
and other............. 138,836 138,257 146,294 266,874 436,529
---------- ---------- ---------- ---------- ----------
Total Revenues......... $3,405,211 $3,930,984 $3,789,668 $4,760,834 $6,470,625
========== ========== ========== ========== ==========
</TABLE>
- --------
(1) Short-term debt consists of current portion of long-term debt, notes
payable and interest-bearing accounts payable.
(2) In accordance with the rules and regulations of the Commission, for
purposes of computing the ratios of earnings to fixed charges, earnings
represent income from operations before fixed charges and taxes, and fixed
charges represent interest on indebtedness, amortization of debt discount
and a share of rental expense which is deemed to be representative of the
interest factor.
4
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The Debt Securities offered hereby are to be issued under an indenture (the
"Indenture") to be executed by NIKE and a trustee, as Trustee (the "Trustee").
A copy of the form of Indenture has been filed as an exhibit to the
Registration Statement. Section references used in this Prospectus refer to
sections of the Indenture.
NIKE may offer under this Prospectus up to $500,000,000 aggregate principal
amount of Debt Securities, or if Debt Securities are issued at a discount, or
in a foreign currency or composite currency, such principal amount as may be
sold for an initial public offering price of up to $500,000,000. Unless
otherwise specified in the applicable Prospectus Supplement, the Debt
Securities will represent direct, unsecured obligations of NIKE and will rank
equally with all other unsecured and unsubordinated indebtedness of NIKE.
The following statements relating to the Debt Securities and the Indenture
are summaries and do not purport to be complete. Such summaries may make use
of certain terms defined in the Indenture and are qualified in their entirety
by express reference to the Indenture. In addition, certain defined terms are
set forth below under "--Certain Definitions".
GENERAL
The terms of each series of Debt Securities will be established by or
pursuant to a resolution of the Board of Directors of NIKE and set forth or
determined in the manner provided in an Officers' Certificate or by a
supplemental indenture. (Indenture (S) 2.2) The particular terms of each
series of Debt Securities will be described in a Prospectus Supplement
relating to such series (including any Pricing Supplement thereto).
The Debt Securities that may be offered under the Indenture are not limited
in aggregate principal amount. The Debt Securities may be issued in one or
more series with the same or various maturities, at par, at a premium, or at a
discount. The Prospectus Supplement (including any Pricing Supplement thereto)
will set forth the initial offering price, the aggregate principal amount and
the following terms of the Debt Securities in respect of which this Prospectus
is delivered: (1) the title of such Debt Securities; (2) the price or prices
(expressed as a percentage of the aggregate principal amount thereof) at which
the Debt Securities will be issued; (3) any limit on the aggregate principal
amount of such Debt Securities; (4) the date or dates on which principal on
such Debt Securities will be payable; (5) the rate or rates (which may be
fixed or variable) per annum or, if applicable, the method used to determine
such rate or rates (including any commodity, commodity index, stock exchange
index or financial index) at which such Debt Securities will bear interest, if
any, the date or dates from which such interest, if any, will accrue, the date
or dates on which such interest, if any, will commence and be payable and any
regular record date for the interest payable on any interest payment date; (6)
the place or places where principal of, premium, if any, and interest, if any,
on such Debt Securities will be payable; (7) the period or periods within
which, the price or prices at which and the terms and conditions upon which
the Debt Securities may be redeemed; (8) the obligation, if any, of NIKE to
redeem or purchase the Debt Securities pursuant to any sinking fund or
analogous provisions or at the option of a holder thereof; (9) the dates, if
any, on which and the price or prices at which the Debt Securities will be
repurchased by NIKE at the option of the Holders thereof and other detailed
terms and provisions of such repurchase obligations; (10) the denominations in
which such Debt Securities may be issuable, if other than denominations of
$1,000 and any integral multiple thereof; (11) whether the Debt Securities are
to be issuable in the form of Certificated Debt Securities (as defined below)
or Global Debt Securities (as defined below); (12) the portion of principal
amount of such Debt Securities that shall be payable upon declaration of
acceleration of the maturity date thereof, if other than the principal amount
thereof; (13) the currency of denomination of such Debt Securities; (14) the
designation of the currency, currencies or currency units in which payment of
principal of, premium, if
5
<PAGE>
any, and interest, if any, on such Debt Securities will be made; (15) if
payments of principal of, premium, if any, or interest, if any, on the Debt
Securities are to be made in one or more currencies or currency units other
than that or those in which such Debt Securities are denominated, the manner
in which the exchange rate with respect to such payments will be determined;
(16) the manner in which the amounts of payment of principal of, premium, if
any, or interest, if any, on such Debt Securities will be determined, if such
amounts may be determined by reference to an index based on a currency or
currencies other than that in which the Debt Securities are denominated or
designated to be payable or by reference to a commodity, commodity index,
stock exchange index or financial index; (17) the provisions, if any, relating
to any security provided for such Debt Securities; (18) any addition to or
change in the Events of Default described herein or in the Indenture with
respect to such Debt Securities and any change in the acceleration provisions
described herein or in the Indenture with respect to such Debt Securities;
(19) any addition to or change in the covenants described herein or in the
Indenture with respect to such Debt Securities; (20) any other terms of such
Debt Securities, none of which will be inconsistent with the Indenture but
which may modify or delete any provision of the Indenture insofar as it
applies to such series; and (21) any depositaries, interest rate calculation
agents, exchange rate calculation agents or other agents with respect to the
Debt Securities other than those originally appointed. (Indenture (S) 2.2)
Debt Securities may be issued that provide 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 the terms of the Indenture
("Discount Securities"). Federal income tax considerations and other special
considerations applicable to any such Discount Securities will be described in
the applicable Prospectus Supplement.
If the purchase price of any of the Debt Securities is denominated in a
foreign currency or currencies, or a foreign currency unit or units or if the
principal of and any premium and interest on any series of Debt Securities is
payable in a foreign currency or currencies or a foreign currency unit or
units, the restrictions, elections, general tax considerations, specific terms
and other information with respect to such issue of Debt Securities and such
foreign currency or currencies or foreign currency unit or units will be set
forth in the applicable Prospectus Supplement.
PAYMENT OF INTEREST AND EXCHANGE
Each Debt Security will be represented by either one or more global
securities (a "Global Debt Security") registered in the name of The Depository
Trust Company, as Depository (the "Depository") or a nominee of the Depository
(each such Debt Security represented by a Global Debt Security being herein
referred to as a "Book-Entry Debt Security"), or a certificate issued in
definitive registered form (a "Certificated Debt Security"), as set forth in
the applicable Prospectus Supplement. Except as set forth under "Global Debt
Securities and Book-Entry System" below, Book-Entry Debt Securities will not
be issuable in certificate form.
CERTIFICATED DEBT SECURITIES. Certificated Debt Securities may be
transferred or exchanged at the Trustee's office or paying agencies in
accordance with the terms of the Indenture. No service charge will be made for
any transfer or exchange of Certificated Debt Securities, but NIKE may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
The transfer of Certificated Debt Securities and the right to the principal
of, premium, if any, and interest, if any, on such Certificated Debt
Securities may be effected only by surrender of the old certificate
representing such Certificated Debt Securities and either reissuance by NIKE
or the Trustee of the old certificate to the new Holder or the issuance by
NIKE or the Trustee of a new certificate to the new Holder.
6
<PAGE>
GLOBAL DEBT SECURITIES AND BOOK-ENTRY SYSTEM. Each Global Debt Security
representing Book-Entry Debt Securities will be deposited with, or on behalf
of, the Depository, and registered in the name of the Depository or a nominee
of the Depository. Except as set forth below, Book-Entry Debt Securities will
not be exchangeable for Certificated Debt Securities and will not otherwise be
issuable as Certificated Debt Securities.
The procedures that the Depository has indicated it intends to follow with
respect to Book-Entry Debt Securities are set forth below.
Ownership of beneficial interests in Book-Entry Debt Securities will be
limited to persons that have accounts with the Depository for the related
Global Debt Security ("participants") or persons that may hold interests
through participants. Upon the issuance of a Global Debt Security, the
Depository will credit, on its book-entry registration and transfer system,
the participants' accounts with the respective principal amounts of the Book-
Entry Debt Securities represented by such Global Debt Security beneficially
owned by such participants. The accounts to be credited shall be designated by
any dealers, underwriters or agents participating in the distribution of such
Book-Entry Debt Securities. Ownership of Book-Entry Debt Securities will be
shown on, and the transfer of such ownership interests will be effected only
through, records maintained by the Depository for the related Global Debt
Security (with respect to interests of participants) and on the records of
participants (with respect to interests of persons holding through
participants). The laws of some states may require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
limits and such laws may impair the ability to own, transfer or pledge
beneficial interests in Book-Entry Debt Securities.
So long as the Depository for a Global Debt Security, or its nominee, is the
registered owner of such Global Debt Security, such Depository or such
nominee, as the case may be, will be considered the sole owner or holder of
the Book-Entry Debt Securities represented by such Global Debt Security for
all purposes under the Indenture. Except as set forth below, owners of Book-
Entry Debt Securities will not be entitled to have such securities registered
in their names, will not receive or be entitled to receive physical delivery
of a certificate in definitive form representing such securities and will not
be considered the owners or holders thereof under the Indenture. Accordingly,
each person owning Book-Entry Debt Securities must rely on the procedures of
the Depository for the related Global Debt Security and, if such person is not
a participant, on the procedures of the participant through which such person
owns its interest, to exercise any rights of a holder under the Indenture.
The Company understands, however, that under existing industry practice, the
Depository will authorize the persons on whose behalf it holds a Global Debt
Security to exercise certain rights of holders of Debt Securities, and the
Indenture provides that the Company, the Trustee and their respective agents
will treat as the holder of a Debt Security the persons specified in a written
statement of the Depository with respect to such Global Debt Security for
purposes of obtaining any consents or directions required to be given by
holders of the Debt Securities pursuant to the Indenture. (Indenture (S)
2.14.6)
Payments of principal, premium, if any, and interest on Book-Entry Debt
Securities will be made to the Depository or its nominee, as the case may be,
as the registered holder of the related Global Debt Security. (Indenture (S)
2.14.5) None of NIKE, the Trustee or any other agent of NIKE or agent of the
Trustee will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in such Global Debt Security or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
NIKE expects that the Depository, upon receipt of any payment of principal,
premium, if any, or interest on a Global Debt Security, will immediately
credit participants' accounts with payments in amounts proportionate to the
respective amounts of Book-Entry Debt Securities held by each such
7
<PAGE>
participant as shown on the records of such Depository. NIKE also expects that
payments by participants to owners of beneficial interests in Book-Entry Debt
Securities held through such participants will be governed by standing
customer instructions and customary practices, as is now the case with the
securities held for the accounts of customers in bearer form or registered in
"street name", and will be the responsibility of such participants.
If the Depository is at any time unwilling or unable to continue as
Depository or ceases to be a clearing agency registered under the Exchange
Act, and a successor Depository registered as a clearing agency under the
Exchange Act is not appointed by NIKE within 90 days, NIKE will issue
Certificated Debt Securities in exchange for each Global Debt Security. In
addition, NIKE may at any time and in its sole discretion determine not to
have any of the Book-Entry Debt Securities represented by one or more Global
Debt Securities and, in such event, will issue Certificated Debt Securities
issued in exchange for a Global Debt Security or Securities. Global Debt
Securities will also be exchangeable for Certificated Debt Securities if an
Event of Default with respect to the Book-Entry Debt Securities represented by
such Global Debt Securities has occurred and is continuing. Any Certificated
Debt Securities issued in exchange for a Global Debt Security will be
registered in such name or names as the Depository shall instruct the Trustee.
It is expected that such instructions will be based upon directions received
by the Depository from participants with respect to ownership of Book-Entry
Debt Securities relating to such Global Debt Security.
The foregoing information in this section concerning the Depository and the
Depository's Book-Entry System has been obtained from sources the Company
believes to be reliable, but the Company takes no responsibility for the
accuracy thereof.
NO PROTECTION IN THE EVENT OF A CHANGE OF CONTROL
Unless otherwise set forth in the Prospectus Supplement, the Debt Securities
will not contain any provisions which may afford holders of the Debt
Securities protection in the event of a change in control of NIKE or in the
event of a highly leveraged transaction (whether or not such transaction
results in a change in control of NIKE).
COVENANTS
Unless otherwise set forth in the Prospectus Supplement and in a supplement
to the Indenture, a Board Resolution or an Officers' Certificate delivered
pursuant thereto, and except as set forth below, the Debt Securities will not
contain any restrictive covenants, including covenants restricting NIKE or any
of its subsidiaries from incurring, issuing, assuming or guarantying any
indebtedness secured by a lien upon any property or shares of capital stock of
NIKE or any subsidiary, or restricting NIKE or any subsidiary from entering
into any sale and leaseback transactions.
CONSOLIDATION, MERGER AND SALE OF ASSETS
NIKE may not consolidate with or merge into, or convey, transfer or lease
all or substantially all of its properties and assets to, any Person (a
"successor Person"), and may not permit any Person to merge into, or convey,
transfer or lease its properties and assets substantially as an entirety to,
NIKE, unless (i) the successor Person (if any) is a corporation, partnership,
trust or other entity organized and validly existing under the laws of any
U.S. domestic jurisdiction and expressly assumes NIKE's obligations on the
Debt Securities and under the Indenture, (ii) immediately after giving effect
to the transaction, no Event of Default, and no event which, after notice or
lapse of time, or both, would become an Event of Default, shall have occurred
and be continuing under the Indenture and (iii) certain other conditions are
met. (Indenture (S) 5.1)
8
<PAGE>
EVENTS OF DEFAULT
The following will be Events of Default under the Indenture with respect to
Debt Securities of any series: (a) default in the payment of any interest upon
any Debt Security of that series when it becomes due and payable, and
continuance of such default for a period of 30 days (unless the entire amount
of such payment is deposited by NIKE with the Trustee or with a paying agent
prior to the expiration of such period of 30 days); (b) default in the payment
of principal of or premium, if any, on any Debt Security of that series when
due and payable; (c) default in the deposit of any sinking fund payment, when
and as due in respect of any Debt Security of that series; (d) default in the
performance or breach of any other covenant or warranty of NIKE in the
Indenture (other than a covenant or warranty that has been included in the
Indenture solely for the benefit of a series of Debt Securities other than
that series), which default continues uncured for a period of 60 days after
written notice to NIKE by the Trustee or to NIKE and the Trustee by the
holders of at least 25% in principal amount of the outstanding Debt Securities
of that series as provided in the Indenture; (e) an event of default under any
Debt of NIKE (including a default with respect to Debt Securities of any
series other than that series) or any Subsidiary, whether such Debt now exists
or shall hereafter be created, if (A) such default results from the failure to
pay any such Debt when it becomes due, (B) the principal amount of such Debt,
together with the principal amount of any other such Debt in default for
failure to pay principal at stated final maturity or the maturity of which has
been so accelerated, aggregates $100 million or more at any one time
outstanding and (C) such Debt is not discharged or such acceleration is not
rescinded or annulled within 10 days after written notice as provided in the
Indenture; (f) certain events of bankruptcy, insolvency or reorganization; and
(g) any other Event of Default provided with respect to Debt Securities of
that series that is described in the Prospectus Supplement accompanying this
Prospectus. No Event of Default with respect to a particular series of Debt
Securities (except as to the certain events in bankruptcy, insolvency or
reorganization) necessarily constitutes an Event of Default with respect to
any other series of Debt Securities. (Indenture (S) 6.1). The occurrence of an
Event of Default may constitute an event of default under NIKE's bank credit
agreements in existence from time to time and under certain guaranties by NIKE
of any subsidiary indebtedness. In addition, the occurrence of certain Events
of Default or an acceleration under the Indenture may constitute an event of
default under certain other indebtedness of NIKE outstanding from time to
time.
If an Event of Default with respect to Debt Securities of any series at the
time outstanding occurs and is continuing, then in every such case the Trustee
or the holders of not less than 25% in principal amount of the outstanding
Debt Securities of that series may, by a notice in writing to NIKE (and to the
Trustee if given by the holders), declare to be due and payable immediately
the principal (or, if the Debt Securities of that series are Discount
Securities, such portion of the principal amount as may be specified in the
terms of that series) and premium, if any, of all Debt Securities of that
series. In the case of an Event of Default resulting from certain events of
bankruptcy, insolvency or reorganization, the principal (or such specified
amount) and premium, if any, of all outstanding Debt Securities shall ipso
facto become and be immediately due and payable without any declaration or
other act on the part of the Trustee or any holder of outstanding Debt
Securities. At any time after a declaration of acceleration with respect to
Debt Securities of any series has been made, but before a judgment or decree
for payment of the money due has been obtained by the Trustee, the holders of
a majority in principal amount of the outstanding Debt Securities of that
series may, subject to NIKE having paid or deposited with the Trustee a sum
sufficient to pay overdue interest and principal which has become due other
than by acceleration and certain other conditions, rescind and annul such
acceleration if all Events of Default, other than the non-payment of
accelerated principal and premium, if any, with respect to Debt Securities of
that series, have been cured or waived as provided in the Indenture.
(Indenture (S) 6.2) For information as to waiver of defaults see the
discussion set forth below under "--Modification and Waiver". Reference is
made to the Prospectus Supplement relating to any series of Debt Securities
that are Discount Securities for the particular provisions relating to
acceleration of a portion of the principal amount of such Discount Securities
upon the occurrence of an Event of Default and the continuation thereof.
9
<PAGE>
The Indenture provides that the Trustee will be under no obligation to
exercise any of its rights or powers under the Indenture at the request of any
holder of outstanding Debt Securities, unless the Trustee receives indemnity
satisfactory to it against any loss, liability or expense. (Indenture (S)
7.1(e)) Subject to certain rights of the Trustee, the holders of a majority in
principal amount of the outstanding Debt Securities of any series shall have
the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on the Trustee with respect to the Debt Securities of that series.
(Indenture (S) 6.12)
No holder of any Debt Security of any series will have any right to
institute any proceeding, judicial or otherwise, with respect to the Indenture
or for the appointment of a receiver or trustee, or for any remedy under the
Indenture, unless such holder shall have previously given to the Trustee
written notice of a continuing Event of Default with respect to Debt
Securities of that series and unless also the holders of at least 25% in
principal amount of the outstanding Debt Securities of that series shall have
made written request, and offered reasonable indemnity, to the Trustee to
institute such proceeding as trustee, and the Trustee shall not have received
from the holders of a majority in principal amount of the outstanding Debt
Securities of that series a direction inconsistent with such request and shall
have failed to institute such proceeding within 60 days. (Indenture (S) 6.7)
Notwithstanding the foregoing, the holder of any Debt Security will have an
absolute and unconditional right to receive payment of the principal of,
premium, if any, and any interest on such Debt Security on or after the due
dates expressed in such Debt Security and to institute suit for the
enforcement of any such payment. (Indenture (S) 6.8)
The Indenture requires NIKE, within 90 days after the end of each of its
fiscal years, to furnish to the Trustee a statement as to compliance with the
Indenture. (Indenture (S) 4.3) The Indenture provides that the Trustee may
withhold notice to the holders of Debt Securities of any series of any Default
or Event or Default (except in payment on any Debt Securities of such series)
with respect to Debt Securities of such series if it in good faith determines
that withholding such notice is in the interest of the holders of such Debt
Securities. (Indenture (S) 7.5)
MODIFICATION AND WAIVER
Modifications to, and amendments of, the Indenture may be made by NIKE and
the Trustee with the consent of the holders of at least a majority in
principal amount of the outstanding Debt Securities of each series affected by
such modifications or amendments; provided, however, that no such modification
or amendment may, without the consent of the holder of each outstanding Debt
Security affected thereby: (a) change the amount of Debt Securities whose
holders must consent to an amendment or waiver; (b) reduce the rate of or
extend the time for payment of interest (including default interest) on any
Debt Security; (c) reduce the principal or premium, if any, or change the
fixed maturity of any Debt Security or reduce the amount of, or postpone the
date fixed for, the payment of any sinking fund or analogous obligation with
respect to any series of Debt Securities; (d) reduce the principal amount of
Discount Securities payable upon acceleration of the maturity thereof; (e)
waive a default in the payment of the principal of, premium, if any, or
interest, if any, on any Debt Security (except a rescission of acceleration of
the Debt Securities of any series by the holders of at least a majority in
aggregate principal amount of the then outstanding Debt Securities of such
series and a waiver of the payment default that resulted from such
acceleration); (f) make the principal of or premium, if any, or interest, if
any, on any Debt Security payable in currency other than that stated in the
Debt Security; (g) make any change to certain provisions of the Indenture
relating to, among other things, the right of holders of Debt Securities to
receive payment of the principal, premium, if any, and interest on such Debt
Securities and to institute suit for the enforcement of any such payment and
to waivers or amendments; or (h) waive a redemption payment with respect to
any Debt Security or change any of the provisions with respect to the
redemption of any Debt Securities. (Indenture (S) 9.3)
10
<PAGE>
The holders of at least a majority in principal amount of the outstanding
Debt Securities of any series may on behalf of the holders of all Debt
Securities of that series waive, insofar as that series is concerned,
compliance by NIKE with provisions of the Indenture other than certain
specified provisions. (Indenture (S) 9.2) The holders of a majority in
principal amount of the outstanding Debt Securities of any series may on
behalf of the holders of all the Debt Securities of such series waive any past
default under the Indenture with respect to such series and its consequences,
except a default in the payment of the principal of, premium, if any, or any
interest on any Debt Security of that series; provided, however, that the
holders of a majority in principal amount of the outstanding Debt Securities
of any series may rescind an acceleration and its consequences, including any
related payment default that resulted from such acceleration. (Indenture (S)
6.13)
DEFEASANCE OF DEBT SECURITIES AND CERTAIN COVENANTS IN CERTAIN CIRCUMSTANCES
LEGAL DEFEASANCE. The Indenture provides that NIKE may be discharged from
any and all obligations in respect of the Debt Securities of any series
(except for certain obligations to register the transfer or exchange of Debt
Securities of such series, to replace stolen, lost or mutilated Debt
Securities of such series, and to maintain paying agencies and certain
provisions relating to the treatment of funds held by paying agents) upon the
deposit with the Trustee, in trust, of money and/or U.S. Government
Obligations or, in the case of Debt Securities denominated in a single
currency other than U.S. Dollars, Foreign Government Obligations, that,
through the payment of interest and principal in respect thereof in accordance
with their terms, will provide money in an amount sufficient in the opinion of
a nationally recognized firm of independent public accountants to pay and
discharge each installment of principal (and premium, if any) and interest, if
any, on and any mandatory sinking fund payments in respect of the Debt
Securities of such series on the stated maturity of such payments in
accordance with the terms of the Indenture and such Debt Securities. Such
discharge may occur only if, among other things, NIKE has received from, or
there has been published by, the United States Internal Revenue Service a
ruling, or, since the date of execution of the Indenture, there has been a
change in the applicable United States federal income tax law, in either case
to the effect that holders of the Debt Securities of such series will not
recognize income, gain or loss for United States federal income tax purposes
as a result of such deposit, defeasance and discharge and will be subject to
United States federal income tax on the same amount 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. (Indenture (S) 8.3)
DEFEASANCE OF CERTAIN COVENANTS. The Indenture provides that unless
otherwise provided by the terms of the applicable series of Debt Securities,
upon compliance with certain conditions, (i) NIKE may omit to comply with the
restrictive covenants contained in Sections 4.2, 4.3 through 4.6 and Section
5.1 of the Indenture, as well as any additional covenants contained in a
supplement to the Indenture, a Board Resolution or an Officers' Certificate
delivered pursuant thereto; and (ii) Events of Default under Section 6.1(e)
shall be inapplicable to such series. The conditions include: the deposit with
the Trustee of money and/or U.S. Government Obligations or, in the case of
Debt Securities denominated in a single currency other than U.S. Dollars,
Foreign Government Obligations, that, through the payment of interest and
principal in respect thereof in accordance with their terms, will provide
money in an amount sufficient in the opinion of a nationally recognized firm
of independent public accountants to pay principal, premium, if any, and
interest, if any, on and any mandatory sinking fund payments in respect of the
Debt Securities of such series on the stated maturity of such payments in
accordance with the terms of the Indenture and such Debt Securities; and the
delivery to the Trustee of an opinion of counsel to the effect that the
holders of the Debt Securities of such series will not recognize income, gain
or loss for United States federal income tax purposes as a result of such
deposit and related covenant defeasance and will be subject to United States
federal income tax in the same amount and in the same manner and at the same
times as would have been the case if such deposit and related covenant
defeasance had not occurred. (Indenture (S) 8.4)
11
<PAGE>
DEFEASANCE AND EVENTS OF DEFAULT. In the event NIKE exercises its option to
omit compliance with certain covenants of the Indenture with respect to any
series of Debt Securities and the Debt Securities of such series are declared
due and payable because of the occurrence of any Event of Default, the amount
of money and/or U.S. Government Obligations or Foreign Government Obligations
on deposit with the Trustee will be sufficient to pay amounts due on the Debt
Securities of such series at the time of their stated maturity but may not be
sufficient to pay amounts due on the Debt Securities of such series at the
time of the acceleration resulting from such Event of Default. However, NIKE
shall remain liable for such payments.
"FOREIGN GOVERNMENT OBLIGATIONS" means, with respect to Debt Securities of
any series that are denominated in a currency other than U.S. Dollars, (i)
direct obligations of the government that issued or caused to be issued such
currency for the payment of which obligations its full faith and credit is
pledged or (ii) obligations of a Person controlled or supervised by or acting
as an agency or instrumentality of such government the timely payment of which
is unconditionally guaranteed as a full faith and credit obligation by such
government, which, in either case under clauses (i) or (ii), are not callable
or redeemable at the option of the issuer thereof.
GOVERNING LAW
The Indenture and the Debt Securities will be governed by, and construed in
accordance with, the internal laws of the State of New York. (Indenture (S)
10.10)
PLAN OF DISTRIBUTION
NIKE may sell Debt Securities to or through underwriters and also may sell
Debt Securities directly to other purchasers or through agents.
The distribution of the Debt Securities may be effected from time to time in
one or more transactions at a fixed price or prices, which may be changed, or
at market prices prevailing at the time of sale, at prices related to such
prevailing market prices, or at negotiated prices.
In connection with the sale of Debt Securities, underwriters may receive
compensation from NIKE or from purchasers of Debt Securities for whom they may
act as agents in the form of discounts, concessions or commissions.
Underwriters may sell Debt Securities to or through dealers, and such dealers
may receive compensation in the form of discounts, concessions or commissions
from the underwriters and/or commissions from the purchasers for whom they may
act as agents. Underwriters, dealers and agents that participate in the
distribution of Debt Securities may be deemed to be underwriters under the
Securities Act, and any discounts or commissions received by them from NIKE
and any profit on the resale of Debt Securities by them may be deemed to be
underwriting discounts and commissions under the Securities Act. Any such
underwriter or agent will be identified, and any compensation received from
NIKE will be described, in the Prospectus Supplement.
NIKE may enter into agreements under which underwriters and agents who
participate in the distribution of Debt Securities may be entitled to
indemnification by NIKE against certain liabilities, including liabilities
under the Securities Act.
LEGAL MATTERS
The validity of the Debt Securities will be passed upon for NIKE by Latham &
Watkins, San Francisco, California and by Paul J. Kelly, Jr., Esq., General
Counsel of NIKE.
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<PAGE>
EXPERTS
The consolidated financial statements incorporated in this Prospectus by
reference to the Company's Current Report on Form 8-K dated September 16, 1996
have been so incorporated in reliance upon the report of Price Waterhouse LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained or incorporated by reference in this Prospectus
or any Prospectus Supplement, including, without limitation, statements
containing the words "believes", "anticipates", "expects" and words of similar
import, constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
that may cause the actual results, performance or achievements of NIKE, or
industry results, to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Such factors include, among others, the following: international,
national and local general economic and market conditions; demographic
changes; the size and growth of the overall athletic market or the footwear or
apparel segments thereof; the ability of NIKE to sustain, manage or forecast
its growth; the size, timing and mix of purchases of NIKE's products; new
product development and introduction; changes in consumer preferences;
existing government regulations and changes in, or the failure to comply with,
government regulations; adverse publicity; dependence on distributors;
liability and other claims asserted against NIKE; competition; the loss of
significant customers or suppliers; fluctuations and difficulty in forecasting
operating results, including, without limitation, the fact that futures orders
may not be indicative of future revenues; changes in business strategy or
development plans; business disruptions; general risks associated with doing
business outside of the United States, including, without limitation, import
duties, tariffs, quotas and political instability; the ability to attract and
retain qualified personnel; the ability to protect trademarks, patents and
other intellectual property; the use of proceeds from the offering; and other
factors referenced or incorporated by reference in this Prospectus or any
Prospectus Supplement. GIVEN SUCH UNCERTAINTIES, PROSPECTIVE INVESTORS ARE
CAUTIONED NOT TO PLACE UNDUE RELIANCE ON SUCH FORWARD-LOOKING STATEMENTS. NIKE
disclaims any obligation to update any such factors or to publicly announce
the results of any revisions to any of the forward-looking statements
contained or incorporated by reference herein to reflect future events or
developments.
13
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Capitalized terms used but not defined in Part II have the meanings ascribed
to them in the Prospectus contained in this Registration Statement.
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth an estimate of expenses to be incurred by the
Company in connection with the issuance and distribution of the securities
offered hereby.
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee................ $151,515
Blue Sky fees and expenses......................................... $ 5,000
Legal fees and disbursements....................................... $300,000
Rating agency fees................................................. $ 60,000
Printing and engraving expenses.................................... $ 14,000
Accounting fees and expenses....................................... $ 40,000
Trustee's fees..................................................... $ 5,500
Miscellaneous...................................................... $ 23,985
--------
TOTAL............................................................ $600,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Oregon Business Corporation Act (the "OBCA") permits a corporation to
include in its articles of incorporation a provision indemnifying a director
if (a) the conduct of the individual was in good faith; (b) the individual
reasonably believed that the individual's conduct was in the best interests of
the corporation, or at least not opposed to its best interests; and (c) in the
case of any criminal proceeding, the individual had no reasonable cause to
believe the individual's conduct was unlawful. In addition, the OBCA provides
that, unless limited by its articles of incorporation, a corporation shall
indemnify a director who was wholly successful, on the merits or otherwise, in
the defense of any proceeding to which the director was a party because of
being a director of the corporation against reasonable expenses incurred by
the director in connection with the proceedings. The Company's articles of
incorporation do not limit such right of indemnification. Section 60.411 of
the OBCA also provides that a corporation has the power to purchase and
maintain insurance on behalf of an individual against any liability asserted
against or incurred by the individual who is or was a director, officer,
employee or agent of the corporation or who, while a director, officer,
employee or agent of the corporation, is or was serving at the request of the
corporation as a director, officer, partner, trustee, employee or agent of
another foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, even if the corporation had no
power to indemnify the individual against such liability under the provisions
of Sections 60.391 or 60.394.
Article VIII of the Restated Articles of Incorporation of the Company
provides as follows:
A. The Corporation shall have the power to indemnify to the fullest
extent not prohibited by law any person who is made or threatened to be
made a party to, witness in, or otherwise involved in, any action, suit or
proceeding, whether civil, criminal, administrative, investigative,
legislative, formal or informal, internal or external or otherwise
(including an action, suit or proceeding by or in the right of the
Corporation) by reason of the fact that the person is or was a director,
officer, employee or agent of the Corporation or a fiduciary within the
meaning of the Employee Retirement Income Security Act of 1974 with respect
to any employee benefit plan of the Corporation, or serves or served at the
request of the Corporation as a director, officer, employee or agent or as
a fiduciary of an employee benefit plan, of another corporation,
partnership, joint
II-1
<PAGE>
venture, trust, or other enterprise. Any indemnification provided pursuant
to this Article VIII shall not be exclusive of any rights to which the
person indemnified may otherwise be entitled under any articles of
incorporation, bylaw, agreement, statute, policy of insurance, vote of
shareholders or Board of Directors, or otherwise, which exists at or
subsequent to the time such person incurs or becomes subject to such
liability and expense.
B. To the fullest extent not prohibited by law, no director of the
Corporation shall be personally liable to the Corporation or its
shareholders for monetary damages for conduct as a director. No amendment
or repeal of this Article VIII, nor the adoption of any provision of these
Restated Articles of Incorporation inconsistent with this Article VIII, nor
a change in the law, shall adversely affect any right or protection that is
based upon this Paragraph B and pertains to conduct that occurred prior to
the time of such amendment, repeal, adoption or change. No change in the
law shall reduce or eliminate the rights and protections set forth in this
Paragraph B unless the change in the law specifically requires such
reduction or elimination. If the Oregon Business Corporation Act is amended
after this Article VIII becomes effective to authorize corporate action
further eliminating or limiting the personal liability of directors of the
Corporation, then the liability of directors of the Corporation shall be
eliminated or limited to the fullest extent not prohibited by the Oregon
Business Corporation Act as so amended.
Article 9 of the Company's Third Restated Bylaws (the "Company's Bylaws")
provides for indemnification of the Company's officers and directors to the
fullest extent permitted by law. However, the Company is not obligated to make
any indemnification in connection with (i) any claim made against any director
or officer for which payment is required to be made to or on behalf of the
director or officer under any insurance policy, except with respect to any
excess amount to which the director or officer is entitled beyond the amount
of payment under such insurance policy, or (ii) any proceeding initiated by
the director or officer, or any proceeding by the director or officer against
the Company or its directors, officers, employees or other persons entitled to
be indemnified by the Company, unless the Company is expressly required by law
to make the indemnification or certain other requirements are met. Article 9,
Section (k) of the Company's Bylaws provides that the Company may purchase
insurance on behalf of any person required or permitted to be indemnified
pursuant to Article 9 upon approval by the Company's Board of Directors.
The Company has entered into indemnity agreements with all directors and
executive officers of the Company relating to their positions as such. The
agreements provide generally that the Company will indemnify the party thereto
for liability arising from third-party proceedings, for proceedings by or in
the right of the Company and otherwise to the fullest extent not prohibited by
law, subject to certain exclusions. The Company also maintains liability
insurance for directors and officers of the Company acting within their
capacities as such.
II-2
<PAGE>
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DOCUMENT DESCRIPTION
------- --------------------
<C> <S>
4.01 Form of Indenture
5.01 Opinion of Paul J. Kelly, Jr., Esq. as to validity of Debt Securities
5.02 Opinion of Latham & Watkins as to validity of Debt Securities
*12.01 Statement of Computation of Ratios of Earnings to Fixed Charges
23.01 Consent of Price Waterhouse LLP
23.02 Consent of Paul J. Kelly, Jr., Esq. (contained in Exhibit 5.01)
23.03 Consent of Latham & Watkins (contained in Exhibit 5.02)
*24.01 Power of Attorney (contained in signature page hereto)
25.01 Statement of Eligibility of the Trustee on Form T-1 of The First
National Bank of Chicago
</TABLE>
- --------
* Previously filed.
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933 (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate. represent a fundamental change in the information set forth
in the registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the registrant pursuant to section 13
or section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of
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<PAGE>
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(c) The undersigned registrant hereby also undertakes that:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(d) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the undersigned
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF BEAVERTON, STATE OF
OREGON, ON THE 25TH DAY OF NOVEMBER 1996.
NIKE, Inc.
/s/ Robert S. Falcone
By: _________________________________
ROBERT S. FALCONE CHIEF FINANCIAL
OFFICER
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT
TO THE REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C> <C>
*Philip H. Knight Chairman of the November 25, 1996
- ---------------------------------- Board and Chief
PHILIP H. KNIGHT Executive Officer
(Principal
Executive Officer)
/s/ Robert S. Falcone Chief Financial November 25, 1996
- ---------------------------------- Officer (Principal
ROBERT S. FALCONE Financial and
Accounting Officer)
*William J. Bowerman Director November 25, 1996
- ----------------------------------
WILLIAM J. BOWERMAN
*Thomas E. Clarke Director November 25, 1996
- ----------------------------------
THOMAS E. CLARKE
*Jill K. Conway Director November 25, 1996
- ----------------------------------
JILL K. CONWAY
*Ralph D. DeNunzio Director November 25, 1996
- ----------------------------------
RALPH D. DENUNZIO
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C> <C>
*Richard K. Donahue Director November 25, 1996
- -------------------------------------
RICHARD K. DONAHUE
*Delbert J. Hayes Director November 25, 1996
- -------------------------------------
DELBERT J. HAYES
*Douglas G. Houser Director November 25, 1996
- -------------------------------------
DOUGLAS G. HOUSER
*John E. Jaqua Director November 25, 1996
- -------------------------------------
JOHN E. JAQUA
*Kenichi Ohmae Director November 25, 1996
- -------------------------------------
KENICHI OHMAE
*Charles W. Robinson Director November 25, 1996
- -------------------------------------
CHARLES W. ROBINSON
*A. Michael Spence Director November 25, 1996
- -------------------------------------
A. MICHAEL SPENCE
*John R. Thompson, Jr. Director November 25, 1996
- -------------------------------------
JOHN R. THOMPSON, JR.
/s/ Robert S. Falcone
*By: ________________________________ November 25, 1996
ROBERT S. FALCONE, ATTORNEY-IN-
FACT
</TABLE>
II-6
<PAGE>
Exhibit 4.01
------------
- --------------------------------------------------------------------------------
NIKE, INC.
INDENTURE
Dated as of ________________ __, 1996
---------------------
The First National Bank of Chicago
Trustee
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I. DEFINITIONS AND INCORPORATION BY REFERENCE..................... 1
SECTION 1.1 DEFINITIONS............................................... 1
SECTION 1.2 OTHER DEFINITIONS......................................... 5
SECTION 1.3 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT......... 6
SECTION 1.4 RULES OF CONSTRUCTION..................................... 6
ARTICLE II. THE SECURITIES................................................ 7
SECTION 2.1 ISSUABLE IN SERIES........................................ 7
SECTION 2.2 ESTABLISHMENT OF TERMS OF SERIES OF SECURITIES............ 7
SECTION 2.3 EXECUTION AND AUTHENTICATION.............................. 9
SECTION 2.4 REGISTRAR AND PAYING AGENT................................ 11
SECTION 2.5 PAYING AGENT TO HOLD MONEY IN TRUST....................... 11
SECTION 2.6 SECURITYHOLDER LISTS...................................... 12
SECTION 2.7 TRANSFER AND EXCHANGE..................................... 12
SECTION 2.8 MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.......... 12
SECTION 2.9 OUTSTANDING SECURITIES.................................... 13
SECTION 2.10 TREASURY SECURITIES...................................... 14
SECTION 2.11 TEMPORARY SECURITIES..................................... 14
SECTION 2.12 CANCELLATION............................................. 14
SECTION 2.13 DEFAULTED INTEREST....................................... 15
SECTION 2.14 GLOBAL SECURITIES........................................ 15
SECTION 2.15 CUSIP NUMBERS............................................ 16
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE III. REDEMPTION................................................... 17
SECTION 3.1 NOTICE TO TRUSTEE......................................... 17
SECTION 3.2 SELECTION OF SECURITIES TO BE REDEEMED.................... 17
SECTION 3.3 NOTICE OF REDEMPTION...................................... 17
SECTION 3.4 EFFECT OF NOTICE OF REDEMPTION............................ 18
SECTION 3.5 DEPOSIT OF REDEMPTION PRICE............................... 18
SECTION 3.6 SECURITIES REDEEMED IN PART............................... 18
ARTICLE IV. COVENANTS..................................................... 19
SECTION 4.1 PAYMENT OF PRINCIPAL AND INTEREST......................... 19
SECTION 4.2 SEC REPORTS............................................... 19
SECTION 4.3 COMPLIANCE CERTIFICATE.................................... 19
SECTION 4.4 STAY, EXTENSION AND USURY LAWS............................ 19
SECTION 4.5 CORPORATE EXISTENCE....................................... 20
SECTION 4.6 TAXES..................................................... 20
ARTICLE V. SUCCESSORS..................................................... 20
SECTION 5.1 WHEN COMPANY MAY MERGE, ETC............................... 20
SECTION 5.2 SUCCESSOR CORPORATION SUBSTITUTED......................... 21
ARTICLE VI. DEFAULTS AND REMEDIES......................................... 21
SECTION 6.1 EVENTS OF DEFAULT......................................... 21
SECTION 6.2 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT........ 23
SECTION 6.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.............................................................. 24
ii
<PAGE>
TABLE OF CONTENTS
Page
----
SECTION 6.4 TRUSTEE MAY FILE PROOFS OF CLAIM.......................... 25
SECTION 6.5 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
SECURITIES........................................................... 26
SECTION 6.6 APPLICATION OF MONEY COLLECTED............................ 26
SECTION 6.7 LIMITATION ON SUITS....................................... 26
SECTION 6.8 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL AND
INTEREST............................................................. 27
SECTION 6.9 RESTORATION OF RIGHTS AND REMEDIES........................ 27
SECTION 6.10 RIGHTS AND REMEDIES CUMULATIVE........................... 27
SECTION 6.11 DELAY OR OMISSION NOT WAIVER............................. 28
SECTION 6.12 CONTROL BY HOLDERS....................................... 28
SECTION 6.13 WAIVER OF PAST DEFAULTS.................................. 28
SECTION 6.14 UNDERTAKING FOR COSTS.................................... 29
ARTICLE VII. TRUSTEE...................................................... 29
SECTION 7.1 DUTIES OF TRUSTEE......................................... 29
SECTION 7.2 RIGHTS OF TRUSTEE......................................... 30
SECTION 7.3 INDIVIDUAL RIGHTS OF TRUSTEE.............................. 31
SECTION 7.4 TRUSTEE'S DISCLAIMER...................................... 31
SECTION 7.5 NOTICE OF DEFAULTS........................................ 32
SECTION 7.6 REPORTS BY TRUSTEE TO HOLDERS............................. 32
SECTION 7.7 COMPENSATION AND INDEMNITY................................ 32
SECTION 7.8 REPLACEMENT OF TRUSTEE.................................... 33
SECTION 7.9 SUCCESSOR TRUSTEE BY MERGER, ETC.......................... 34
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION............................ 34
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY........ 34
iii
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE VIII. SATISFACTION AND DISCHARGE; DEFEASANCE...................... 35
SECTION 8.1 SATISFACTION AND DISCHARGE OF INDENTURE................... 35
SECTION 8.2 APPLICATION OF TRUST FUNDS; INDEMNIFICATION............... 36
SECTION 8.3 LEGAL DEFEASANCE OF SECURITIES OF ANY SERIES.............. 37
SECTION 8.4 COVENANT DEFEASANCE....................................... 38
SECTION 8.5 REPAYMENT TO COMPANY...................................... 40
ARTICLE IX. AMENDMENTS AND WAIVERS........................................ 40
SECTION 9.1 WITHOUT CONSENT OF HOLDERS................................ 40
SECTION 9.2 WITH CONSENT OF HOLDERS................................... 41
SECTION 9.3 LIMITATIONS............................................... 41
SECTION 9.4 COMPLIANCE WITH TRUST INDENTURE ACT....................... 42
SECTION 9.5 REVOCATION AND EFFECT OF CONSENTS......................... 42
SECTION 9.6 NOTATION ON OR EXCHANGE OF SECURITIES..................... 42
SECTION 9.7 TRUSTEE PROTECTED......................................... 43
ARTICLE X. MISCELLANEOUS.................................................. 43
SECTION 10.1 TRUST INDENTURE ACT CONTROLS............................. 43
SECTION 10.2 NOTICES.................................................. 43
SECTION 10.3 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.............. 44
SECTION 10.4 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT....... 44
SECTION 10.5 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION............ 44
SECTION 10.6 RULES BY TRUSTEE AND AGENTS.............................. 45
SECTION 10.7 LEGAL HOLIDAYS........................................... 45
iv
<PAGE>
TABLE OF CONTENTS
Page
----
SECTION 10.8 NO RECOURSE AGAINST OTHERS............................... 45
SECTION 10.9 COUNTERPARTS............................................. 45
SECTION 10.10 GOVERNING LAWS.......................................... 45
SECTION 10.11 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS........... 46
SECTION 10.12 SUCCESSORS.............................................. 46
SECTION 10.13 SEVERABILITY............................................ 46
SECTION 10.14 TABLE OF CONTENTS, HEADINGS, ETC........................ 46
SECTION 10.15 SECURITIES IN A FOREIGN CURRENCY OR IN ECU.............. 46
SECTION 10.16 JUDGMENT CURRENCY....................................... 47
ARTICLE XI. SINKING FUNDS................................................. 48
SECTION 11.1 APPLICABILITY OF ARTICLE................................. 48
SECTION 11.2 SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.... 48
SECTION 11.3 REDEMPTION OF SECURITIES FOR SINKING FUND................ 49
v
<PAGE>
Indenture dated as of __________ __, 1996 between NIKE, Inc., an
Oregon corporation ("Company"), and The First National Bank of Chicago, a
national banking association ("Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Securities issued under
this Indenture.
ARTICLE I.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions.
-----------
"Affiliate" of any specified person means any other person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms "controlled by" and
"under common control with"), as used with respect to any person, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such person, whether through the
ownership of voting securities or by agreement or otherwise.
"Agent" means any Registrar, Paying Agent or Service Agent.
"Authorized Newspaper" means a newspaper in an official language of
the country of publication customarily published at least once a day for at
least five days in each calendar week and of general circulation in the place in
connection with which the term is used. If it shall be impractical in the
opinion of the Trustee to make any publication of any notice required hereby in
an Authorized Newspaper, any publication or other notice in lieu thereof that is
made or given by the Trustee shall constitute a sufficient publication of such
notice.
"Bearer" means anyone in possession from time to time of a Bearer
Security.
"Bearer Security" means any Security that does not provide for the
identification of the Holder thereof.
"Board of Directors" means the Board of Directors of the Company or
any duly authorized committee thereof.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been adopted by the
Board of Directors or pursuant
<PAGE>
to authorization by the Board of Directors and to be in full force and effect on
the date of the certificate and delivered to the Trustee.
"Business Day" means, unless otherwise provided by Board Resolution,
Officers' Certificate or supplemental indenture hereto for a particular Series,
any day except a Saturday, Sunday or a legal holiday in The City of New York,
the City of Portland, Oregon, or the City of Chicago on which banking
institutions are authorized or required by law, regulation or executive order to
close.
"Company" means the party named as such above until a successor
replaces it and thereafter means the successor.
"Company Order" means a written order signed in the name of the
Company by two Officers, one of whom must be the Company's principal executive
officer, principal financial officer or principal accounting officer.
"Company Request" means a written request signed in the name of the
Company by its Chairman of the Board, a President or a Vice President, and by
its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary,
and delivered to the Trustee.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered.
"Debt" of any person as of any date means, without duplication, all
indebtedness of such person in respect of borrowed money, including all
interest, fees and expenses owed in respect thereto (whether or not the recourse
of the lender is to the whole of the assets of such person or only to a portion
thereof), or evidenced by bonds, notes, debentures or similar instruments.
"Default" means any event which is, or after notice or passage of time
would be, an Event of Default.
"Depository" means, with respect to the Securities of any Series
issuable or issued in whole or in part in the form of one or more Global
Securities, the person designated as Depository for such Series by the Company,
which Depository shall be a clearing agency registered under the Exchange Act;
and if at any time there is more than one such person, "Depository" as used with
respect to the Securities of any Series shall mean the Depository with respect
to the Securities of such Series.
"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 6.2.
2
<PAGE>
"Dollars" means the currency of The United States of America.
"ECU" means the European Currency Unit as determined by the Commission
of the European Union.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Foreign Currency" means any currency or currency unit issued by a
government other than the government of The United States of America.
"Foreign Government Obligations" means with respect to Securities of
any Series that are denominated in a Foreign Currency, (i) direct obligations of
the government that issued or caused to be issued such currency for the payment
of which obligations its full faith and credit is pledged or (ii) obligations of
a person controlled or supervised by or acting as an agency or instrumentality
of such government the timely payment of which is unconditionally guaranteed as
a full faith and credit obligation by such government, which, in either case
under clauses (i) or (ii), are not callable or redeemable at the option of the
issuer thereof.
"Global Security" or "Global Securities" means a Security or
Securities, as the case may be, in the form established pursuant to Section 2.1
evidencing all or part of a Series of Securities, issued to the Depository for
such Series or its nominee, and registered in the name of such Depository or
nominee.
"Holder" or "Securityholder" means a person in whose name a Security
is registered or the holder of a Bearer Security.
"Indenture" means this Indenture as amended from time to time and
shall include the form and terms of particular Series of Securities established
or contemplated hereunder.
"Maturity," when used with respect to any Security or installment of
principal thereof, means the date on which the principal of such Security or
such 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, any President, any Vice-
President, the Treasurer, the Secretary, any Assistant Treasurer or any
Assistant Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers,
one of whom must be the Company's principal executive officer, principal
financial officer or principal accounting officer.
"Opinion of Counsel" means a written opinion of legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company.
3
<PAGE>
"person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"principal" of a Security means the principal of the Security plus,
when appropriate, the premium, if any, on the Security.
"Responsible Officer" when used with respect to the Trustee, means the
chairman or the vice-chairman of the board of directors or trustees, the
chairman or vice-chairman of the executive committee of the board of directors
or trustees, the president, any vice-president, the treasurer, the secretary,
any trust officer, any second or assistant vice-president or any officer or
assistant officer of the Trustee other than those specifically above mentioned
customarily performing functions similar to those performed by the persons who
at the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of his knowledge of and familiarity with a particular
subject.
"SEC" means the Securities and Exchange Commission.
"Securities" means the debentures, notes or other debt instruments of
the Company of any Series authenticated and delivered under this Indenture.
"Series" or "Series of Securities" means each series of debentures,
notes or other debt instruments of the Company created pursuant to Sections 2.1
and 2.2 hereof.
"Significant Subsidiary" means (i) any direct or indirect Subsidiary
of the Company that would be a "significant subsidiary" as defined in Article 1,
Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act of 1933,
as amended, as such regulation is in effect on the date hereof, or (ii) any
group of direct or indirect Subsidiaries of the Company that, taken together as
a group, would be a "significant subsidiary" as defined in Article 1, Rule 1-02
of Regulation S-X, promulgated pursuant to the Securities Act of 1933, as
amended, as such regulation is in effect on the date hereof,
"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 as the fixed date on which the principal of such Security or
such installment of principal or interest is due and payable.
"Subsidiary" of any specified person means any corporation of which at
least a majority of the outstanding stock having by the terms thereof ordinary
voting power for the election 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
4
<PAGE>
happening of any contingency) is at the time directly or indirectly owned by
such person, or by one or more other Subsidiaries, or by such person and one or
more other Subsidiaries.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)
77aaa-77bbbb) as in effect on the date of this Indenture; provided, however,
-------- -------
that in the event the Trust Indenture Act of 1939 is amended after such date,
"TIA" means, to the extent required by any such amendment, the Trust Indenture
Act as so amended.
"Trustee" means the person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each person who is then a Trustee hereunder, and
if at any time there is more than one such person, "Trustee" as used with
respect to the Securities of any Series shall mean the Trustee with respect to
Securities of that Series.
"U.S. Government Obligations" means securities which are (i) direct
obligations of The United States of America 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 of
America, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by The United States of America which are not callable or
redeemable at the option of the issuer thereof, and shall also include a
depository receipt issued by a bank or trust company as custodian with respect
to any such U.S. Government Obligation or a specific payment of interest on or
principal of any such U.S. Government Obligation held by such custodian for the
account of the holder of a depository 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 depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation evidenced by such
depository receipt.
<TABLE>
<CAPTION>
SECTION 1.2 Other Definitions.
-----------------
DEFINED IN TERM SECTION
------------
<S> <C>
"Bankruptcy Law" 6.1
"Custodian" 6.1
"Event of Default" 6.1
"Journal" 10.15
"Judgment Currency" 10.16
"Legal Holiday" 10.7
"mandatory sinking fund payment" 11.1
"Market Exchange Rate" 10.15
"New York Banking Day" 10.16
"optional sinking fund payment" 11.1
</TABLE>
5
<PAGE>
<TABLE>
<S> <C>
"Paying Agent" 2.4
"Registrar" 2.4
"Required Currency" 10.16
"Service Agent" 2.4
"successor person" 5.1
</TABLE>
SECTION 1.3 Incorporation by Reference of Trust Indenture Act.
-------------------------------------------------
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company and
any successor obligor upon the Securities.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
and not otherwise defined herein are used herein as so defined.
SECTION 1.4 Rules of Construction.
---------------------
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned
to it in accordance with generally accepted accounting principles;
(c) references to "generally accepted accounting principles" shall
mean generally accepted accounting principles in effect as of the time when
and for the period as to which such accounting principles are to be
applied;
6
<PAGE>
(d) "or" is not exclusive;
(e) words in the singular include the plural, and in the plural
include the singular; and
(f) provisions apply to successive events and transactions.
ARTICLE II.
THE SECURITIES
SECTION 2.1 Issuable in Series.
------------------
The aggregate principal amount of Securities that may be authenticated
and delivered under this Indenture is unlimited. The Securities may be issued
in one or more Series. All Securities of a Series shall be identical except as
may be provided in a Board Resolution, a supplemental indenture hereto or an
Officers' Certificate detailing the adoption of the terms thereof pursuant to
the Board Resolution, supplemental indenture hereto or Officers' Certificate. In
the case of Securities of a Series to be issued from time to time, the Board
Resolution, Officers' Certificate or supplemental indenture hereto may provide
for the method by which specified terms (such as interest rate, maturity date,
record date or date from which interest should accrue) are to be determined.
Securities may differ between Series in respect of any matters, provided that
all Series of Securities shall be equally and ratably entitled to the benefits
of the Indenture.
SECTION 2.2 Establishment of Terms of Series of Securities.
----------------------------------------------
At or prior to the issuance of any Securities within a Series, the
following shall be established (as to the Series generally, in the case of
Subsections 2.2.1 and 2.2.2 and either as to such Securities within the Series
or as to the Series generally in the case of Subsections 2.2.3 through 2.2.22)
by a Board Resolution, a supplemental indenture hereto or an Officers'
Certificate pursuant to authority granted under a Board Resolution:
2.2.1 the title of the Series (which shall distinguish the Securities
of that particular Series from the Securities of any other Series);
2.2.2 the price or prices (expressed as a percentage of the aggregate
principal amount thereof) at which the Securities of the Series will be issued;
2.2.3 any limit upon the aggregate principal amount of the Securities
of the Series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Securities of the Series pursuant
to Section 2.7, 2.8, 2.11, 3.6 or 9.6);
7
<PAGE>
2.2.4 the date or dates on which the principal of the Securities of
the Series is payable;
2.2.5 the rate or rates (which may be fixed or variable) per annum
or, if applicable, the method used to determine such rate or rates (including,
but not limited to, any commodity, commodity index, stock exchange index or
financial index) at which the Securities of the Series shall bear interest, if
any, the date or dates from which such interest, if any, shall accrue, the date
or dates on which such interest, if any, shall commence and be payable and any
regular record date for the interest payable on any interest payment date;
2.2.6 the place or places where the principal of and interest, if
any, on the Securities of the Series shall be payable, or the method of such
payment, if by wire transfer, mail or other means;
2.2.7 the period or periods within which, the price or prices at
which and the terms and conditions upon which the Securities of the Series may
be redeemed, in whole or in part, at the option of the Company;
2.2.8 the obligation, if any, of the Company to redeem or purchase
the Securities of the Series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or periods within
which, the price or prices at which and the terms and conditions upon which
Securities of the Series shall be redeemed or purchased, in whole or in part,
pursuant to such obligation;
2.2.9 the dates, if any, on which and the price or prices at which
the Securities of the Series will be repurchased by the Company at the option of
the Holders thereof and other detailed terms and provisions of such repurchase
obligations;
2.2.10 if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which the Securities of the Series shall be
issuable;
2.2.11 the forms of the Securities of the Series in bearer or fully
registered form (and, if in fully registered form, whether the Securities will
be issuable as Global Securities);
2.2.12 if other than the principal amount thereof, the portion of the
principal amount of the Securities of the Series that shall be payable upon
declaration of acceleration of the maturity thereof pursuant to Section 6.2;
2.2.13 the currency of denomination of the Securities of the Series,
which may be Dollars or any Foreign Currency, including, but not limited to, the
ECU, and if such currency of denomination is a composite currency other than the
ECU, the agency or organization, if any, responsible for overseeing such
composite currency;
8
<PAGE>
2.2.14 the designation of the currency, currencies or currency units
in which payment of the principal of and interest, if any, on the Securities of
the Series will be made;
2.2.15 if payments of principal of or interest, if any, on the
Securities of the Series are to be made in one or more currencies or currency
units other than that or those in which such Securities are denominated, the
manner in which the exchange rate with respect to such payments will be
determined;
2.2.16 the manner in which the amounts of payment of principal of or
interest, if any, on the Securities of the Series will be determined, if such
amounts may be determined by reference to an index based on a currency or
currencies other than that in which the Securities of the Series are denominated
or designated to be payable or by reference to a commodity, commodity index,
stock exchange index or financial index;
2.2.17 the provisions, if any, relating to any security provided for
the Securities of the Series;
2.2.18 any addition to or change in the Events of Default which
applies to any Securities of the Series and any change in the right of the
Trustee or the requisite Holders of such Securities to declare the principal
amount thereof due and payable pursuant to Section 6.2;
2.2.19 any addition to or change in the covenants set forth in
Article IV which applies to Securities of the Series;
2.2.20 any other terms of the Securities of the Series (which terms
shall not be inconsistent with the provisions of this Indenture, except as
permitted by Section 9.1, but which may modify or delete any provision of this
Indenture insofar as it applies to such Series); and
2.2.21 any depositories, interest rate calculation agents, exchange
rate calculation agents or other agents with respect to Securities of such
Series if other than those appointed herein.
All Securities of any one Series need not be issued at the same time
and may be issued from time to time, consistent with the terms of this
Indenture, if so provided by or pursuant to the Board Resolution, supplemental
indenture hereto or Officers' Certificate referred to above, and the authorized
principal amount of any Series may not be increased to provide for issuances of
additional Securities of such Series, unless otherwise provided in the Board
Resolution, supplemental indenture hereto or Officers' Certificate.
SECTION 2.3 Execution and Authentication.
----------------------------
Two Officers shall sign the Securities for the Company by manual or
facsimile signature.
9
<PAGE>
If an Officer whose signature is on a Security no longer holds that
office at the time the Security is authenticated, the Security shall
nevertheless be valid.
A Security shall not be valid until authenticated by the manual
signature of the Trustee or an authenticating agent. The signature shall be
conclusive evidence that the Security has been authenticated under this
Indenture.
The Trustee shall at any time, and from time to time, authenticate
Securities for original issue in the principal amount provided in the Board
Resolution, supplemental indenture hereto or Officers' Certificate, upon receipt
by the Trustee of a Company Order. If provided for in such procedures, such
Company Order may authorize authentication and delivery pursuant to oral or
electronic instructions from the Company or its duly authorized agent or agents,
which oral instructions shall be promptly confirmed in writing. Each Security
shall be dated the date of its authentication unless otherwise provided by a
Board Resolution, a supplemental indenture hereto or an Officers' Certificate.
The aggregate principal amount of Securities of any Series outstanding
at any time may not exceed any limit upon the maximum principal amount for such
Series set forth in the Board Resolution, supplemental indenture hereto or
Officers' Certificate delivered pursuant to Section 2.2, except as provided in
Section 2.8.
Prior to the issuance of Securities of any Series, the Trustee shall
have received and (subject to Section 7.2) shall be fully protected in relying
on: (a) the Board Resolution, supplemental indenture hereto or Officers'
Certificate establishing the form of the Securities of that Series or of
Securities within that Series and the terms of the Securities of that Series or
of Securities within that Series, (b) an Officers' Certificate complying with
Section 10.4, and (c) an Opinion of Counsel complying with Section 10.4.
The Trustee shall have the right to decline to authenticate and
deliver any Securities of such Series: (a) if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken; or (b) if the
Trustee in good faith by its board of directors or trustees, executive committee
or a trust committee of directors and/or vice-presidents shall determine that
such action would expose the Trustee to personal liability to Holders of any
then outstanding Series of Securities.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities. An authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company or
an Affiliate.
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SECTION 2.4 Registrar and Paying Agent.
--------------------------
The Company shall maintain, with respect to each Series of Securities,
at the place or places specified with respect to such Series pursuant to Section
2.2, an office or agency where Securities of such Series may be presented or
surrendered for payment ("Paying Agent"), where Securities of such Series may be
surrendered for registration of transfer or exchange ("Registrar") and where
notices and demands to or upon the Company in respect of the Securities of such
Series and this Indenture may be served ("Service Agent"). The Registrar shall
keep a register with respect to each Series of Securities and to their transfer
and exchange. The Company will give prompt written notice to the Trustee of the
name and address, and any change in the name or address, of each Registrar,
Paying Agent or Service Agent. If at any time the Company shall fail to
maintain any such required Registrar, Paying Agent or Service Agent or shall
fail to furnish the Trustee with the name and address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more co-
registrars, additional paying agents or additional service agents and may from
time to time rescind such designations; provided, however, that no such
-------- -------
designation or rescission shall in any manner relieve the Company of its
obligations to maintain a Registrar, Paying Agent and Service Agent in each
place so specified pursuant to Section 2.2 for Securities 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 name or address of any
such co-registrar, additional paying agent or additional service agent. The
term "Registrar" includes any co-registrar; the term "Paying Agent" includes any
additional paying agent; and the term "Service Agent" includes any additional
service agent.
The Company hereby appoints the Trustee the initial Registrar, Paying
Agent and Service Agent for each Series unless another Registrar, Paying Agent
or Service Agent, as the case may be, is appointed prior to the time Securities
of that Series are first issued.
SECTION 2.5 Paying Agent to Hold Money in Trust.
-----------------------------------
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust, for the benefit of
Securityholders of any Series of Securities, or the Trustee, all money held by
the Paying Agent for the payment of principal of or interest on the Series of
Securities, and will notify the Trustee of any default by the Company in making
any such payment. While any such default continues, the Trustee may require a
Paying Agent to pay all money held by it to the Trustee. The Company at any
time may require a Paying Agent to pay all money held by it to the Trustee.
Upon payment over to the Trustee, the Paying Agent (if other than the Company or
a Subsidiary) shall have no further liability for
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the money. If the Company or a Subsidiary acts as Paying Agent, it shall
segregate and hold in a separate trust fund for the benefit of Securityholders
of any Series of Securities all money held by it as Paying Agent.
SECTION 2.6 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
Securityholders of each Series of Securities and shall otherwise comply with TIA
(S) 312(a). If the Trustee is not the Registrar, the Company shall furnish to
the Trustee at least ten days before each interest payment date and at such
other times as the Trustee may request in writing a list, in such form and as of
such date as the Trustee may reasonably require, of the names and addresses of
Securityholders of each Series of Securities.
SECTION 2.7 Transfer and Exchange.
---------------------
Where Securities of a Series are presented to the Registrar or a co-
registrar with a request to register a transfer or to exchange them for an equal
principal amount of Securities of the same Series, the Registrar shall register
the transfer or make the exchange if its requirements for such transactions are
met. To permit registrations of transfers and exchanges, the Trustee shall
authenticate Securities at the Registrar's request. No service charge shall be
made for any registration of transfer or exchange (except as otherwise expressly
permitted herein), but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer tax or similar governmental charge
payable upon exchanges pursuant to Sections 2.11, 3.6 or 9.6).
Neither the Company nor the Registrar shall be required (a) to issue,
register the transfer of, or exchange Securities of any Series for the period
beginning at the opening of business fifteen days immediately preceding the
mailing of a notice of redemption of Securities of that Series selected for
redemption and ending at the close of business on the day of such mailing, or
(b) to register the transfer of or exchange Securities of any Series selected,
called or being called for redemption as a whole or the portion being redeemed
of any such Securities selected, called or being called for redemption in part.
SECTION 2.8 Mutilated, Destroyed, Lost and Stolen Securities.
------------------------------------------------
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same Series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
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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
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 has been acquired by a bona fide
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and make available for delivery, in lieu of any such destroyed,
lost or stolen Security, a new Security of the same Series and of like tenor and
principal amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
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 issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security 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 that Series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 2.9 Outstanding Securities.
----------------------
The Securities outstanding at any time are all the Securities
authenticated by the Trustee except for those canceled by it, those delivered to
it for cancellation, those reductions in the interest on a Global Security
effected by the Trustee in accordance with the provisions hereof and those
described in this Section as not outstanding.
If a Security is replaced pursuant to Section 2.8, it ceases to be
outstanding until the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds on the Maturity of Securities of a Series money
sufficient to pay such Securities
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payable on that date, then on and after that date such Securities of the Series
cease to be outstanding and interest on them ceases to accrue.
A Security does not cease to be outstanding because the Company or an
Affiliate holds the Security.
In determining whether the Holders of the requisite principal amount
of outstanding Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, the principal amount of a
Discount Security that shall be deemed to be outstanding for such purposes shall
be the amount of the principal thereof that would be due and payable as of the
date of such determination upon a declaration of acceleration of the Maturity
thereof pursuant to Section 6.2.
SECTION 2.10 Treasury Securities.
-------------------
In determining whether the Holders of the required principal amount of
Securities of a Series have concurred in any direction, waiver or consent,
Securities of a Series owned by the Company or an Affiliate shall be
disregarded, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities of a Series that the Trustee knows are so owned shall be so
disregarded.
SECTION 2.11 Temporary Securities.
--------------------
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities upon a Company
Order. Temporary Securities shall be substantially in the form of definitive
Securities but may have variations that the Company considers appropriate for
temporary Securities. Without unreasonable delay, the Company shall prepare and
the Trustee upon request shall authenticate definitive Securities of the same
Series and date of maturity in exchange for temporary Securities. Until so
exchanged, temporary securities shall have the same rights under this Indenture
as the definitive Securities.
SECTION 2.12 Cancellation.
------------
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee shall cancel all Securities surrendered for transfer,
exchange, payment, replacement or cancellation and shall destroy such canceled
Securities (subject to the record retention requirement of the Exchange Act) and
deliver a certificate of such destruction to the Company, unless the Company
otherwise directs. The Company may not issue new Securities to replace
Securities that it has paid or delivered to the Trustee for cancellation.
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SECTION 2.13 Defaulted Interest.
------------------
If the Company defaults in a payment of interest on a Series of
Securities, it shall pay the defaulted interest, plus, to the extent permitted
by law, any interest payable on the defaulted interest, to the persons who are
Securityholders of the Series on a subsequent special record date. The Company
shall fix the record date and payment date. At least 30 days before the record
date, the Company shall mail to the Trustee and to each Securityholder of the
Series a notice that states the record date, the payment date and the amount of
interest to be paid. The Company may pay defaulted interest in any other lawful
manner.
SECTION 2.14 Global Securities.
-----------------
2.14.1 Terms of Securities. A Board Resolution, a supplemental
-------------------
indenture hereto or an Officers' Certificate shall establish whether the
Securities of a Series shall be issued in whole or in part in the form of one or
more Global Securities and the Depository for such Global Security or
Securities.
2.14.2 Transfer and Exchange. Notwithstanding any provisions to the
---------------------
contrary contained in Section 2.7 of the Indenture and in addition thereto, any
Global Security shall be exchangeable pursuant to Section 2.7 of the Indenture
for securities registered in the names of Holders other than the Depository for
such Security or its nominee only if (i) such Depository notifies the Company
that it is unwilling or unable to continue as Depository for such Global
Security or if at any time such Depository ceases to be a clearing agency
registered under the Exchange Act, and, in either case, the Company fails to
appoint a successor Depository within 90 days of such event, (ii) the Company
executes and delivers to the Trustee an Officers' Certificate to the effect that
such Global Security shall be so exchangeable or (iii) an Event of Default with
respect to the Securities represented by such Global Security shall have
happened and be continuing. Any Global Security that is exchangeable pursuant
to the preceding sentence shall be exchangeable for Securities registered in
such names as the Depository shall direct in writing in an aggregate principal
amount equal to the principal amount of the Global Security with like tenor and
terms.
Except as provided in this Section 2.14.2, a Global Security may not
be transferred except as a whole by the Depository with respect to such Global
Security to a nominee of such Depository, by a nominee of such Depository to
such Depository or another nominee of such Depository or by the Depository or
any such nominee to a successor Depository or a nominee of such a successor
Depository.
2.14.3 Legend. Any Global Security issued hereunder shall bear a
------
legend in substantially the following form:
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<PAGE>
"This Security is a Global Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of the
Depository or a nominee of the Depository. This Security is exchangeable for
Securities registered in the name of a person other than the Depository or its
nominee only in the limited circumstances described in the Indenture, and may
not be transferred except as a whole by the Depository to a nominee of the
Depository, by a nominee of the Depository to the Depository or another nominee
of the Depository or by the Depository or any such nominee to a successor
Depository or a nominee of such a successor Depository."
2.14.4 Acts of Holders. The Depository, as a Holder, may appoint
---------------
agents and otherwise authorize participants to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action which a Holder
is entitled to give or take under the Indenture.
2.14.5 Payments. Notwithstanding the other provisions of this
--------
Indenture, unless otherwise specified as contemplated by Section 2.2, payment of
the principal of and interest, if any, on any Global Security shall be made to
the person specified therein.
2.14.6 Consents, Declaration and Directions. Except as provided in
------------------------------------
Section 2.14.5, the Company, the Trustee and any Agent shall treat a person as
the Holder of such principal amount of outstanding Securities of such Series
represented by a Global Security as shall be specified in a written statement of
the Depositary with respect to such Global Security, for purposes of obtaining
any consents, declarations or directions required to be given by the Holders
pursuant to this Indenture.
SECTION 2.15 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 notices
of redemption as a convenience to Holders; provided 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 elements of
identification printed on the Securities, and any such redemption shall not be
affected by any defect in or omission of such numbers.
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ARTICLE III.
REDEMPTION
SECTION 3.1 Notice to Trustee.
-----------------
The Company may, with respect to any Series of Securities, reserve the
right to redeem and pay the Series of Securities or may covenant to redeem and
pay the Series of Securities or any part thereof prior to the Stated Maturity
thereof at such time and on such terms as provided for in such Securities. If a
Series of Securities is redeemable and the Company wants or is obligated to
redeem prior to the Stated Maturity thereof all or part of the Series of
Securities pursuant to the terms of such Securities, it shall notify the Trustee
of the redemption date and the principal amount of Series of Securities to be
redeemed. The Company shall give the notice at least 45 days before the
redemption date (or such shorter notice as may be acceptable to the Trustee).
SECTION 3.2 Selection of Securities to be Redeemed.
--------------------------------------
Unless otherwise indicated for a particular Series by a Board
Resolution, a supplemental indenture hereto or an Officers' Certificate, if less
than all the Securities of a Series are to be redeemed, the Trustee shall select
the Securities of the Series to be redeemed in any manner that the Trustee deems
fair and appropriate. The Trustee shall make the selection from Securities of
the Series outstanding not previously called for redemption. The Trustee may
select for redemption portions of the principal of Securities of the Series that
have denominations larger than $1,000. Securities of the Series and portions of
them it selects shall be in amounts of $1,000 or whole multiples of $1,000 or,
with respect to Securities of any Series issuable in other denominations
pursuant to Section 2.2.10, the minimum principal denomination for each Series
and integral multiples thereof. Provisions of this Indenture that apply to
Securities of a Series called for redemption also apply to portions of
Securities of that Series called for redemption.
SECTION 3.3 Notice of Redemption.
--------------------
Unless otherwise indicated for a particular Series by Board
Resolution, a supplemental indenture hereto or an Officers' Certificate, at
least 30 days but not more than 60 days before a redemption date, the Company
shall mail a notice of redemption by first-class mail to each Holder whose
Securities are to be redeemed and if any Bearer Securities are outstanding,
publish on one occasion a notice in an Authorized Newspaper.
The notice shall identify the Securities of the Series to be redeemed
and shall state:
(a) the redemption date;
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(b) the redemption price;
(c) the name and address of the Paying Agent;
(d) that Securities of the Series called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(e) that interest on Securities of the Series called for redemption
ceases to accrue on and after the redemption date; and
(f) any other information as may be required by the terms of the
particular Series or the Securities of a Series being redeemed.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense.
SECTION 3.4 Effect of Notice of Redemption.
------------------------------
Once notice of redemption is mailed or published as provided in
Section 3.3, Securities of a Series called for redemption become due and payable
on the redemption date and at the redemption price. A notice of redemption may
not be conditional. Upon surrender to the Paying Agent, such Securities shall
be paid at the redemption price plus accrued interest to the redemption date.
SECTION 3.5 Deposit of Redemption Price.
---------------------------
On or before the redemption date, the Company shall deposit with the
Paying Agent money sufficient to pay the redemption price of and accrued
interest, if any, on all Securities to be redeemed on that date.
SECTION 3.6 Securities Redeemed in Part.
---------------------------
Upon surrender of a Security that is redeemed in part, the Trustee
shall authenticate for the Holder a new Security of the same Series and the same
maturity equal in principal amount to the unredeemed portion of the Security
surrendered.
18
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ARTICLE IV.
COVENANTS
SECTION 4.1 Payment of Principal and Interest.
---------------------------------
The Company covenants and agrees for the benefit of each Series of
Securities that it will duly and punctually pay the principal of and interest,
if any, on the Securities of that Series in accordance with the terms of such
Securities and this Indenture.
SECTION 4.2 SEC Reports.
-----------
The Company shall deliver to the Trustee within 15 days after it files
them with the SEC 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 SEC may by rules and regulations prescribe) which the Company is required
to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. The
Company also shall comply with the other provisions of TIA (S) 314(a).
SECTION 4.3 Compliance Certificate.
----------------------
The Company shall deliver to the Trustee, within 90 days after the end
of each fiscal year of the Company, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his knowledge the Company has kept, observed, performed and fulfilled each and
every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions hereof
(or, if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he may have knowledge).
The Company will, so long as any of the Securities are outstanding,
deliver to the Trustee, forthwith upon becoming aware of any Default or Event of
Default, an Officers' Certificate specifying such Default or Event of Default
and what action the Company is taking or proposes to take with respect thereto.
SECTION 4.4 Stay, Extension and Usury Laws.
------------------------------
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to
19
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the extent it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not, by resort to any such
law, 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 has been enacted.
SECTION 4.5 Corporate Existence.
-------------------
Subject to Article V, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and the corporate, partnership or other existence of each Significant
Subsidiary in accordance with the respective organizational documents of each
Significant Subsidiary and the rights (charter and statutory), licenses and
franchises of the Company and its Significant Subsidiaries; provided, however,
-------- -------
that the Company shall not be required to preserve any such right, license or
franchise, or the corporate, partnership or other existence of any Significant
Subsidiary, if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
its Subsidiaries taken as a whole and that the loss thereof is not adverse in
any material respect to the Holders.
SECTION 4.6 Taxes.
-----
The Company shall, and shall cause each of its Significant
Subsidiaries to, pay prior to delinquency all taxes, assessments and
governmental levies, except as contested in good faith and by appropriate
proceedings.
ARTICLE V.
SUCCESSORS
SECTION 5.1 When Company May Merge, Etc.
---------------------------
The Company shall not consolidate with or merge into, or convey,
transfer or lease all or substantially all of its properties and assets to, any
person (a "successor person"), and may not permit any person to merge into, or
convey, transfer or lease its properties and assets substantially as an
entirety to, the Company, unless:
(a) the successor person (if any) is a corporation, partnership, trust
or other entity organized and validly existing under the laws of any U.S.
domestic jurisdiction and expressly assumes the Company's obligations on
the Securities and under this Indenture and
(b) immediately after giving effect to the transaction, no Default or
Event of Default, shall have occurred and be continuing.
20
<PAGE>
The Company shall deliver to the Trustee prior to the consummation of
the proposed transaction an Officers' Certificate to the foregoing effect and an
Opinion of Counsel stating that the proposed transaction and such supplemental
indenture comply with this Indenture.
SECTION 5.2 Successor Corporation Substituted.
---------------------------------
Upon any consolidation or merger, or any sale, lease, conveyance or
other disposition of all or substantially all of the assets of the Company in
accordance with Section 5.1, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
lease, conveyance or other disposition 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 has been named
as the Company herein; provided, however, that the predecessor Company in the
-------- -------
case of a sale, lease, conveyance or other disposition shall not be released
from the obligation to pay the principal of and interest, if any, on the
Securities.
ARTICLE VI.
DEFAULTS AND REMEDIES
SECTION 6.1 Events of Default.
-----------------
"Event of Default," wherever used herein with respect to Securities of
any Series, means any one of the following events, unless in the establishing
Board Resolution, supplemental indenture hereto or Officers' Certificate, it is
provided that such Series shall not have the benefit of said Event of Default:
(a) default in the payment of any interest on any Security of that
Series when it becomes due and payable, and continuance of such default for
a period of 30 days (unless the entire amount of such payment is deposited
by the Company with the Trustee or with a Paying Agent prior to the
expiration of such period of 30 days); or
(b) default in the payment of the principal of any Security of that
Series at its Maturity; or
(c) default in the deposit of any sinking fund payment, when and as
due in respect of any Security of that Series; or
(d) default in the performance or breach of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty that
has been included in this Indenture solely for the benefit of Series of
Securities other than that Series), which default continues uncured for a
period of 60 days after there has been given, by registered
21
<PAGE>
or certified mail, to the Company by the Trustee or to the Company and the
Trustee by the Holders of at least 25% in principal amount of the
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; or
(e) a default under any Debt of the Company (including a default with
respect to Securities of any Series other than that Series) or any
Subsidiary, whether such Debt now exists or shall hereafter be created, if
(A) such default results from the failure to pay any such Debt when it
becomes due, (B) the principal amount of such Debt, together with the
principal amount of any other such Debt in default for failure to pay
principal at stated final maturity or the maturity of which has been so
accelerated, aggregates $100,000,000 or more at any one time outstanding,
and (C) such Debt is not discharged or such acceleration is not rescinded
or annulled within 10 days after written notice to the Company by the
holder or holders of such Debt in the manner provided for in the applicable
debt instrument; or
(f) the Company or any of its Significant Subsidiaries pursuant to or
within the meaning of any Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in
an involuntary case,
(iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) generally is unable to pay its debts as the same become
due; or
(g) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Company or any of its
Significant Subsidiaries in an involuntary case,
(ii) appoints a Custodian of the Company or any of its
Significant Subsidiaries or for all or substantially all of its
property, or
(iii) orders the liquidation of the Company or any of its
Significant Subsidiaries,
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and the order or decree remains unstayed and in effect for 60 days; or
(h) any other Event of Default provided with respect to Securities of
that Series, which is specified in a Board Resolution, a supplemental
indenture hereto or an Officers' Certificate, in accordance with Section
2.2.18.
No Event of Default with respect to a particular Series of Securities
(except with respect to subsections (f) and (g) above) necessarily constitutes
an Event of Default with respect to any other Series of Securities.
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 6.2 Acceleration of Maturity; Rescission and Annulment.
--------------------------------------------------
If an Event of Default with respect to Securities of any Series at the
time outstanding occurs and is continuing, then in every such case the Trustee
or the Holders of not less than 25% in principal amount of the outstanding
Securities of that Series may declare the principal amount (or, if any
Securities of that Series are Discount Securities, such portion of the principal
amount as may be specified in the terms of such Securities) of all of the
Securities of that Series to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), and upon any
such declaration such principal amount (or specified amount) shall become
immediately due and payable. If an Event of Default specified in Section 6.1(f)
or (g) shall occur, the principal amount (or specified amount) of all
outstanding Securities shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holder.
At any time after such a declaration of acceleration with respect to
any Series has been made and before a judgment or decree for payment of the
money due has been obtained by the Trustee as hereinafter in this Article
provided, the Holders of a majority in principal amount of the outstanding
Securities of that Series, by written notice to the Company and the Trustee, may
rescind and annul such declaration and its consequences if:
(a) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(i) all overdue interest, if any, on all Securities of that
Series,
(ii) the principal of any Securities of that Series which have
become due otherwise than by such declaration of acceleration and
interest thereon at the rate or rates prescribed therefor in such
Securities,
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(iii) to the extent that payment of such interest is lawful,
interest upon any overdue principal and overdue interest at the rate
or rates prescribed therefor in such Securities, and
(iv) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(b) all 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 6.13.
No such rescission shall affect any subsequent Default or impair any right
consequent thereon.
SECTION 6.3 Collection of Indebtedness and Suits for Enforcement by
-------------------------------------------------------
Trustee.
The Company covenants that if
(a) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(b) default is made in the payment of principal of any Security at the
Maturity thereof, or
(c) default is made in the deposit of any sinking fund payment when
and as due by the terms of a Security,
then, the Company will, upon demand of the Trustee, pay to it, for the
benefit of the Holders of such Securities, the whole amount then due and payable
on such Securities for principal and interest and, to the extent that payment of
such interest shall be legally enforceable, interest on any overdue principal or
any overdue interest, at the rate or rates prescribed therefor in such
Securities, and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon such Securities and collect the
moneys adjudged or deemed to be payable in the manner provided by
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law out of the property of the Company or any other obligor upon such
Securities, wherever situated.
If an Event of Default with respect to any 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 6.4 Trustee May File Proofs of Claim.
--------------------------------
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole amount of principal and
interest owing and unpaid in respect of the Securities and to file such
other papers or documents as may be necessary or advisable in order to have
the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel) and of the Holders allowed in such judicial proceeding,
and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same,
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
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SECTION 6.5 Trustee May Enforce Claims Without Possession of Securities.
-----------------------------------------------------------
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, 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 in respect of which such
judgment has been recovered.
SECTION 6.6 Application of Money Collected.
------------------------------
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or interest,
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 payment of all amounts due the Trustee under Section
7.7; and
Second: To the payment of the amounts then due and unpaid for
principal of and interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal and interest, respectively; and
Third: To the Company.
SECTION 6.7 Limitation on Suits.
-------------------
No Holder of any Security of any Series 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
(a) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
Series;
(b) the Holders of not less than 25% in principal amount of the
outstanding Securities of that Series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
26
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(d) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(e) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the outstanding Securities of that Series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all such
Holders.
SECTION 6.8 Unconditional Right of Holders to Receive Principal and
-------------------------------------------------------
Interest.
- --------
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest, if any, on such Security on
the Stated Maturity or Stated Maturities expressed in such Security (or, in the
case of redemption, on the redemption date) and to institute suit for the
enforcement of any such payment, and such rights shall not be impaired without
the consent of such Holder.
SECTION 6.9 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 6.10 Rights and Remedies Cumulative.
------------------------------
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in Section 2.8, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
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SECTION 6.11 Delay or Omission Not Waiver.
----------------------------
No delay or omission of the Trustee or of any Holder of any Securities
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
SECTION 6.12 Control by Holders.
------------------
The Holders of a majority in principal amount of the outstanding
Securities of any Series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Securities of such Series, provided that
(a) such direction shall not be in conflict with any rule of law or
with this Indenture,
(b) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and
(c) subject to the provisions of Section 6.1, the Trustee shall have
the right to decline to follow any such direction if the Trustee in good
faith shall, by a Responsible Officer of the Trustee, determine that the
proceeding so directed would involve the Trustee in personal liability.
SECTION 6.13 Waiver of Past Defaults.
-----------------------
The Holders of not less than a majority in principal amount of the
outstanding Securities of any Series may on behalf of the Holders of all the
Securities of such Series waive any past Default hereunder with respect to such
Series and its consequences, except a Default (1) in the payment of the
principal of or interest on any Security of such Series (provided, however, that
the Holders of a majority in principal amount of the outstanding Securities of
any Series may rescind an acceleration and its consequences, including any
related payment default that resulted from such acceleration). 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.
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SECTION 6.14 Undertaking for Costs.
---------------------
All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in principal
amount of the outstanding Securities of any Series, or to any suit instituted by
any Holder for the enforcement of the payment of the principal of or interest on
any Security on or after the Stated Maturity or Stated Maturities expressed in
such Security (or, in the case of redemption, on or after the redemption date).
ARTICLE VII.
TRUSTEE
SECTION 7.1 Duties of Trustee.
-----------------
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise the rights and powers vested in it by this Indenture and use
the same degree of care and skill in their exercise as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) The Trustee need perform only those duties that are
specifically set forth in this Indenture and no others.
(ii) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon Officers'
Certificates or Opinions of Counsel furnished to the Trustee and
conforming to the requirements of this Indenture; however, in the case
-------
of any such Officers' Certificates or Opinions of Counsel which by any
provisions hereof are specifically required to be furnished to the
Trustee, the Trustee shall examine such Officers' Certificates and
Opinions of Counsel to determine whether or not they conform to the
requirements of this Indenture.
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<PAGE>
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) This paragraph does not limit the effect of paragraph (b)
of this Section.
(ii) The Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts.
(iii) The Trustee shall not be liable with respect to any action
taken, suffered or omitted to be taken by it with respect to
Securities of any Series in good faith in accordance with the
direction of the Holders of a majority in principal amount of the
outstanding Securities of such Series relating to the time, method and
place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Indenture with respect to the Securities of such Series.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraph (a), (b) and (c) of this Section.
(e) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money
held in trust by the Trustee need not be segregated from other funds except
to the extent required by law.
(g) No provision of this Indenture shall require the Trustee to risk
its own funds or otherwise incur any financial liability in the performance
of any of its duties, 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 is not reasonably assured to it.
(h) The Paying Agent, the Registrar and any authenticating agent shall
be entitled to the protections, immunities and standard of care as are set
forth in paragraphs (a), (b) and (c) of this Section with respect to the
Trustee.
SECTION 7.2 Rights of Trustee.
-----------------
(a) The Trustee may rely on and shall be protected in acting or
refraining from acting upon any document believed by it to be genuine and
to have been signed or
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presented by the proper person. The Trustee need not investigate any fact
or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance
on such Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care. No
Depository shall be deemed an agent of the Trustee and the Trustee shall
not be responsible for any act or omission by any Depository.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its
rights or powers.
(e) The Trustee may consult with counsel and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders of Securities 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.
SECTION 7.3 Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or an
Affiliate with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. The Trustee is also subject to Sections 7.10
and 7.11.
SECTION 7.4 Trustee's Disclaimer.
--------------------
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for any
statement in the Securities other than its authentication.
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SECTION 7.5 Notice of Defaults.
------------------
If a Default or Event of Default occurs and is continuing with respect
to the Securities of any Series and if it is known to a Responsible Officer of
the Trustee, the Trustee shall mail to each Securityholder of the Securities of
that Series and, if any Bearer Securities are outstanding, publish on one
occasion in an Authorized Newspaper, notice of a Default or Event of Default
within 90 days after it occurs or, if later, after a Responsible Officer of the
Trustee has knowledge of such Default or Event of Default. Except in the case
of a Default or Event of Default in payment of principal of or interest on any
Security of any Series, the Trustee may withhold the notice if and so long as
its corporate trust committee or a committee of its Responsible Officers in good
faith determines that withholding the notice is in the interests of
Securityholders of that Series.
SECTION 7.6 Reports by Trustee to Holders.
-----------------------------
Within 60 days after May 15 in each year, the Trustee shall transmit
by mail to all Securityholders, as their names and addresses appear on the
Security Register, and, if any Bearer Securities are outstanding, publish in an
Authorized Newspaper, a brief report dated as of such May 15, in accordance
with, and to the extent required under, TIA (S) 313.
A copy of each report at the time of its mailing to Securityholders of
any Series shall be filed with the SEC and each stock exchange on which the
Securities of that Series are listed. The Company shall promptly notify the
Trustee when Securities of any Series are listed on any stock exchange.
SECTION 7.7 Compensation and Indemnity.
--------------------------
The Company shall pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred by it. Such expenses shall include the reasonable compensation and
expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee (including the cost of
defending itself) against any loss, liability or expense incurred by it except
as set forth in the next paragraph in the performance of its duties under this
Indenture as Trustee or Agent. 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
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,
which consent shall not be unreasonably withheld. This indemnification shall
apply to officers, directors, employees, shareholders and agents of the Trustee.
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The Company need not reimburse any expense or indemnify against any
loss or liability incurred by the Trustee or by any officer, director, employee,
shareholder or agent of the Trustee through negligence or bad faith.
To secure the Company's payment obligations in 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 and interest on particular Securities of that Series.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(f) or (g) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 7.8 Replacement of Trustee.
----------------------
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign with respect to the Securities of one or more
Series by so notifying the Company. The Holders of a majority in principal
amount of the Securities of any Series may remove the Trustee with respect to
that Series by so notifying the Trustee and the Company. The Company may remove
the Trustee with respect to Securities of one or more Series if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Securities may appoint
a successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee with respect to the Securities of any one or
more Series does not take office within 60 days after the retiring Trustee
resigns or is removed, the retiring
33
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Trustee, the Company or the Holders of at least 10% in principal amount of the
Securities of the applicable Series may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee with respect to the Securities of any one or more
Series fails to comply with Section 7.10, any Securityholder of the applicable
Series may petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee subject to the lien provided for in Section 7.7, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
with respect to each Series of Securities for which it is acting as Trustee
under this Indenture. A successor Trustee shall mail a notice of its succession
to each Securityholder of each such Series and, if any Bearer Securities are
outstanding, publish such notice on one occasion in an Authorized Newspaper.
Notwithstanding replacement of the Trustee pursuant to this Section 7.8, the
Company's obligations under Section 7.7 hereof shall continue for the benefit of
the retiring trustee with respect to expenses and liabilities incurred by it
prior to such replacement.
SECTION 7.9 Successor Trustee by Merger, etc.
--------------------------------
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
SECTION 7.10 Eligibility; Disqualification.
-----------------------------
This Indenture shall always have a Trustee who satisfies the
requirements of TIA (S) 310(a)(1), (2) and (5). The Trustee shall always have a
combined capital and surplus of at least $25,000,000 as set forth in its most
recent published annual report of condition. The Trustee shall comply with TIA
(S) 310(b).
SECTION 7.11 Preferential Collection of Claims Against Company.
-------------------------------------------------
The Trustee is subject to TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated.
34
<PAGE>
ARTICLE VIII.
SATISFACTION AND DISCHARGE; DEFEASANCE
SECTION 8.1 Satisfaction and Discharge of Indenture.
---------------------------------------
This Indenture shall upon Company Order cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(a) either
(i) all Securities theretofore authenticated and delivered
(other than Securities that have been destroyed, lost or stolen and
that have been replaced or paid) have been delivered to the Trustee
for cancellation; or
(ii) all such Securities not theretofore delivered to the Trustee
for cancellation
(1) have become due and payable, or
(2) will become due and payable at their Stated
Maturity within one year, or
(3) 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, or
(4) are deemed paid and discharged pursuant to Section
8.3, as applicable;
and the Company, in the case of (1), (2) or (3) above, has deposited or caused
to be deposited with the Trustee as trust funds in trust an amount sufficient
for the purpose of paying and discharging the entire indebtedness on such
Securities not theretofore delivered to the Trustee for cancellation, for
principal and interest to the date of such deposit (in the case of Securities
which have become due and payable on or prior to the date of such deposit) or to
the Stated Maturity or redemption date, as the case may be;
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
35
<PAGE>
(c) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 7.7, and, if money shall
have been deposited with the Trustee pursuant to clause (a) of this Section or
if money or obligations shall have been deposited with or received by the
Trustee pursuant to Section 8.3, the obligations of the Trustee under Section
8.2 and Section 8.5 shall survive.
SECTION 8.2 Application of Trust Funds; Indemnification.
-------------------------------------------
(a) Subject to the provisions of Section 8.5, all money deposited with
the Trustee pursuant to Section 8.1, all money and U.S. Government
Obligations or Foreign Government Obligations deposited with the Trustee
pursuant to Section 8.3 or 8.4 and all money received by the Trustee in
respect of U.S. Government Obligations or Foreign Government Obligations
deposited with the Trustee pursuant to Section 8.3 or 8.4, shall be held in
trust and applied by it, in accordance with the provisions of the
Securities and this Indenture, to the payment, either directly or through
any Paying Agent (including the Company acting as its own Paying Agent) as
the Trustee may determine, to the persons entitled thereto, of the
principal and interest for whose payment such money has been deposited with
or received by the Trustee or to make mandatory sinking fund payments or
analogous payments as contemplated by Sections 8.3 or 8.4.
(b) The Company shall pay and shall indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against U.S. Government
Obligations or Foreign Government Obligations deposited pursuant to
Sections 8.3 or 8.4 or the interest and principal received in respect of
such obligations other than any payable by or on behalf of Holders.
(c) The Trustee shall deliver or pay to the Company from time to time
upon Company Request any U.S. Government Obligations or Foreign Government
Obligations or money held by it as provided in Sections 8.3 or 8.4 which,
in the opinion of a nationally recognized firm of independent certified
public accountants expressed in a written certification thereof delivered
to the Trustee, are then in excess of the amount thereof which then would
have been required to be deposited for the purpose for which such U.S.
Government Obligations or Foreign Government Obligations or money were
deposited or received. This provision shall not authorize the sale by the
Trustee of any U.S. Government Obligations or Foreign Government
Obligations held under this Indenture.
36
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SECTION 8.3 Legal Defeasance of Securities of any Series.
--------------------------------------------
Unless this Section 8.3 is otherwise specified, pursuant to Section
2.2.20, to be inapplicable to Securities of any Series, the Company shall be
deemed to have paid and discharged the entire indebtedness on all the
outstanding Securities of any such Series on the 91st day after the date of the
deposit referred to in subparagraph (d) hereof, and the provisions of this
Indenture, as it relates to such outstanding Securities of any such Series,
shall no longer be in effect (and the Trustee, at the expense of the Company,
shall, at Company Request, execute proper instruments acknowledging the same),
except as to:
(a) the rights of Holders of Securities of such Series to receive,
from the trust funds described in subparagraph (d) hereof, (i) payment of
the principal of and each installment of principal of or interest on the
outstanding Securities of such Series on the Stated Maturity of such
principal or installment of principal or interest and (ii) the benefit of
any mandatory sinking fund payments applicable to the Securities of such
Series on the day on which such payments are due and payable in accordance
with the terms of this Indenture and the Securities of such Series;
(b) the Company's obligations with respect to such Securities of such
Series under Sections 2.4, 2.7 and 2.8; and
(c) the rights, powers, trust and immunities of the Trustee hereunder
and the duties of the Trustee under Section 8.2 and the duty of the Trustee
to authenticate Securities of such Series issued on registration of
transfer or exchange;
provided that, the following conditions shall have been satisfied:
(d) the Company shall have deposited or caused to be deposited
irrevocably with the Trustee as trust funds in trust for the purpose of
making the following payments, specifically pledged as security for and
dedicated solely to the benefit of the Holders of such Securities (i) in
the case of Securities of such Series denominated in Dollars, cash in
Dollars (or such other money or currencies as shall then be legal tender in
the United States) and/or U.S. Government Obligations, or (ii) in the case
of Securities of such Series denominated in a Foreign Currency (other than
a composite currency), money and/or Foreign Government Obligations, which
through the payment of interest and principal in respect thereof, in
accordance with their terms, will provide (and without reinvestment and
assuming no tax liability will be imposed on such Trustee), not later than
one day before the due date of any payment of money, an amount in cash,
sufficient, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered
to the Trustee, to pay and discharge each installment of principal
(including mandatory sinking fund or analogous
37
<PAGE>
payments) of and interest, if any, on all the Securities of such Series on the
dates such installments of interest or principal are due;
(e) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound;
(f) no Default or Event of Default with respect to the Securities of
such Series shall have occurred and be continuing on the date of such
deposit or during the period ending on the 91st day after such date;
(g) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel to the effect 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 of Counsel shall
confirm that, the Holders of the Securities of such Series will not
recognize income, gain or loss for Federal income tax purposes as a result
of such deposit, defeasance and discharge and will be subject to Federal
income tax on the same amount 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;
(h) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the
intent of preferring the Holders of the Securities of such Series over any
other creditors of the company or with the intent of defeating, hindering,
delaying or defrauding any other creditors of the Company;
(i) such deposit shall not result in the trust arising from such
deposit constituting an investment company (as defined in the Investment
Company Act of 1940, as amended), or such trust shall be qualified under
such Act or exempt from regulation thereunder; and
(j) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to the defeasance contemplated by this
Section have been complied with.
SECTION 8.4 Covenant Defeasance.
-------------------
Unless this Section 8.4 is otherwise specified pursuant to Section
2.2.20 to be inapplicable to Securities of any Series, on and after the 91st day
after the date of the deposit referred to in subparagraph (a) hereof, the
Company may omit to comply with any term,
38
<PAGE>
provision or condition set forth under Sections 4.2, 4.3, 4.4, 4.5, 4.6, and 5.1
as well as any additional covenants contained in a supplemental indenture hereto
for a particular Series of Securities or a Board Resolution or an Officers'
Certificate delivered pursuant to Section 2.2.20 (and the failure to comply with
any such provisions shall not constitute a Default or Event of Default under
Section 6.1) and the occurrence of any event described in clause (e) of Section
6.1 shall not constitute a Default or Event of Default hereunder, with respect
to the Securities of such Series, provided that the following conditions shall
have been satisfied:
(a) With reference to this Section 8.4, the Company has deposited or
caused to be irrevocably deposited (except as provided in Section 8.3) with
the Trustee as trust funds in trust, specifically pledged as security for,
and dedicated solely to, the benefit of the Holders of such Securities (i)
in the case of Securities of such Series denominated in Dollars, cash in
Dollars (or such other money or currencies as shall then be legal tender in
the United States) and/or U.S. Government Obligations, or (ii) in the case
of Securities of such Series denominated in a Foreign Currency (other than
a composite currency), money and/or Foreign Government Obligations, which
through the payment of interest and principal in respect thereof, in
accordance with their terms, will provide (and without reinvestment and
assuming no tax liability will be imposed on such Trustee), not later than
one day before the due date of any payment of money, an amount in cash,
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 principal and interest, if any, on and any
mandatory sinking fund in respect of the Securities of such Series on the
dates such installments of interest or principal are due;
(b) Such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound;
(c) No Default or Event of Default with respect to the Securities of
such Series shall have occurred and be continuing on the date of such
deposit or during the period ending on the 91st day after such date;
(d) the Company shall have delivered to the Trustee an Opinion of
Counsel confirming that Holders of the Securities of such Series will not
recognize income, gain or loss for federal income tax purposes as a result
of such deposit and defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have
been the case if such deposit and defeasance had not occurred;
(e) the Company shall have delivered to the Trustee an Officers'
Certificate stating the deposit was not made by the Company with the intent
of preferring the Holders of the Securities of such Series over any other
creditors of the Company or with
39
<PAGE>
the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company; and
(f) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the defeasance contemplated by
this Section have been complied with.
SECTION 8.5 Repayment to Company.
--------------------
The Trustee and the Paying Agent shall pay to the Company upon request
any money held by them for the payment of principal and interest that remains
unclaimed for two years. After that, Securityholders entitled to the money must
look to the Company for payment as general creditors unless an applicable
abandoned property law designates another person.
ARTICLE IX.
AMENDMENTS AND WAIVERS
SECTION 9.1 Without Consent of Holders.
--------------------------
The Company and the Trustee may amend or supplement this Indenture or
the Securities of one or more Series without the consent of any Securityholder:
(a) to cure any ambiguity, defect or inconsistency;
(b) to comply with Article V;
(c) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(d) to make any change that does not adversely affect the rights of
any Securityholder;
(e) to provide for the issuance of and establish the form and terms
and conditions of Securities of any Series as permitted by this Indenture;
(f) 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; or
(g) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA.
40
<PAGE>
SECTION 9.2 With Consent of Holders.
-----------------------
The Company and the Trustee may enter into a supplemental indenture
with the written consent of the Holders of at least a majority in principal
amount of the outstanding Securities of each Series affected by such
supplemental indenture (including consents obtained in connection with a tender
offer or exchange offer for the Securities of such Series), for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of any supplemental indenture or of modifying in
any manner the rights of the Securityholders of each such Series. Except as
provided in Section 6.13, the Holders of at least a majority in principal amount
of the outstanding Securities of each Series affected by such waiver by notice
to the Trustee (including consents obtained in connection with a tender offer or
exchange offer for the Securities of such Series) may waive compliance by the
Company with any provision of this Indenture or the Securities with respect to
such Series.
It shall not be necessary for the consent of the Holders of Securities
under this Section 9.2 to approve the particular form of any proposed
supplemental indenture or waiver, but it shall be sufficient if such consent
approves the substance thereof. After a supplemental indenture or waiver under
this section becomes effective, the Company shall mail to the Holders of
Securities affected thereby and, if any Bearer Securities affected thereby are
outstanding, publish on one occasion in an Authorized Newspaper, a notice
briefly describing the supplemental indenture or waiver. Any failure by the
Company to mail or publish such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture or waiver.
SECTION 9.3 Limitations.
-----------
Without the consent of each Securityholder affected, an amendment or
waiver may not:
(a) change the amount of Securities whose Holders must consent to an
amendment, supplement or waiver;
(b) reduce the rate of or extend the time for payment of interest
(including default interest) on any Security;
(c) reduce the principal or change the Stated Maturity of any Security
or reduce the amount of, or postpone the date fixed for, the payment of any
sinking fund or analogous obligation;
(d) reduce the principal amount of Discount Securities payable upon
acceleration of the maturity thereof;
41
<PAGE>
(e) waive a Default or Event of Default in the payment of the
principal of or interest, if any, on any Security (except a rescission of
acceleration of the Securities of any Series by the Holders of at least a
majority in principal amount of the outstanding Securities of such Series
and a waiver of the payment default that resulted from such acceleration);
(f) make the principal of or interest, if any, on any Security payable
in any currency other than that stated in the Security;
(g) make any change in Sections 6.8, 6.13, 9.3 (this sentence), 10.15
or 10.16; or
(h) waive a redemption payment with respect to any Security or change
any of the provisions with respect to the redemption of any Securities.
SECTION 9.4 Compliance with Trust Indenture Act.
-----------------------------------
Every amendment to this Indenture or the Securities of one or more
Series shall be set forth in a supplemental indenture hereto that complies with
the TIA as then in effect.
SECTION 9.5 Revocation and Effect of Consents.
---------------------------------
Until an amendment or waiver becomes effective, a consent to it by a
Holder of a Security is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of a Security if the Trustee receives the
notice of revocation before the date the amendment or waiver becomes effective.
Any amendment or waiver once effective shall bind every Securityholder
of each Series affected by such amendment or waiver unless it is of the type
described in any of clauses (a) through (g) of Section 9.3. In that case, the
amendment or waiver shall bind each Holder of a Security who has consented to it
and every subsequent Holder of a Security or portion of a Security that
evidences the same debt as the consenting Holder's Security.
SECTION 9.6 Notation on or Exchange of Securities.
-------------------------------------
The Trustee may place an appropriate notation about an amendment or
waiver on any Security of any Series thereafter authenticated. The Company in
exchange for Securities of that Series may issue and the Trustee shall
authenticate upon request new Securities of that Series that reflect the
amendment or waiver.
42
<PAGE>
SECTION 9.7 Trustee Protected.
-----------------
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 7.1) 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 shall sign all
supplemental indentures, except that the Trustee need not sign any supplemental
indenture that adversely affects its rights.
ARTICLE X.
MISCELLANEOUS
SECTION 10.1 Trust Indenture Act Controls.
----------------------------
If any provision of this Indenture limits, qualifies, or conflicts
with another provision which is required or deemed to be included in this
Indenture by the TIA, such required or deemed provision shall control.
SECTION 10.2 Notices.
-------
Any notice or communication by the Company or the Trustee to the other
is duly given if in writing and delivered in person or mailed by first-class
mail:
if to the Company:
NIKE, Inc.
One Bowerman Drive
Beaverton, Oregon
97005-6453
Attention: General Counsel
if to the Trustee:
The First National Bank of Chicago
One First National Plaza
Mail Suite #0126
Chicago, Illinois 60670
Attn: Corporate Trust Services Division
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
43
<PAGE>
Any notice or communication to a Securityholder shall be mailed by
first-class mail to his address shown on the register kept by the Registrar and,
if any Bearer Securities are outstanding, published in an Authorized Newspaper.
Failure to mail a notice or communication to a Securityholder of any Series or
any defect in it shall not affect its sufficiency with respect to other
Securityholders of that or any other Series.
If a notice or communication is mailed or published in the manner
provided above, within the time prescribed, it is duly given, whether or not the
Securityholder receives it.
If the Company mails a notice or communication to Securityholders, it
shall mail a copy to the Trustee and each Agent at the same time.
SECTION 10.3 Communication by Holders with Other Holders.
-------------------------------------------
Securityholders of any Series may communicate pursuant to TIA (S)
312(b) with other Securityholders of that Series or any other Series with
respect to their rights under this Indenture or the Securities of that Series or
all Series. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA (S) 312(c).
SECTION 10.4 Certificate and Opinion as to Conditions Precedent.
--------------------------------------------------
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(b) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 10.5 Statements Required in Certificate or Opinion.
---------------------------------------------
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA (S) 314(a)(4)) shall comply with the provisions of TIA
(S) 314(e) and shall include:
(a) a statement that the person making such certificate or opinion has
read such covenant or condition;
(b) 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;
44
<PAGE>
(c) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(d) a statement as to whether or not, in the opinion of such person,
such condition or covenant has been complied with.
SECTION 10.6 Rules by Trustee and Agents.
---------------------------
The Trustee may make reasonable rules for action by or a meeting of
Securityholders of one or more Series. Any Agent may make reasonable rules and
set reasonable requirements for its functions.
SECTION 10.7 Legal Holidays.
--------------
Unless otherwise provided by Board Resolution, Officers' Certificate
or supplemental indenture hereto for a particular Series, a "Legal Holiday" is
any day that is not a Business Day. If a payment date is a Legal Holiday at a
place of payment, payment may be made at that place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue for the intervening
period.
SECTION 10.8 No Recourse Against Others.
--------------------------
A director, officer, employee or stockholder, as such, of the Company
shall not have any liability for any obligations of the Company under the
Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. Each Securityholder by accepting
a Security waives and releases all such liability. The waiver and release are
part of the consideration for the issue of the Securities.
SECTION 10.9 Counterparts.
------------
This Indenture may be executed in any number of counterparts and by
the parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
SECTION 10.10 Governing Laws.
--------------
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE
AND THE SECURITIES.
45
<PAGE>
SECTION 10.11 No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
SECTION 10.12 Successors.
----------
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
SECTION 10.13 Severability.
------------
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 10.14 Table of Contents, Headings, Etc.
--------------------------------
The Table of Contents, Cross-Reference Table, and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 10.15 Securities in a Foreign Currency or in ECU.
------------------------------------------
Unless otherwise specified in a Board Resolution, a supplemental
indenture hereto or an Officers' Certificate delivered pursuant to Section 2.2
of this Indenture with respect to a particular Series of Securities, whenever
for purposes of this Indenture any action may be taken by the Holders of a
specified percentage in aggregate principal amount of Securities of all Series
or all Series affected by a particular action at the time outstanding and, at
such time, there are outstanding Securities of any Series which are denominated
in a coin or currency other than Dollars (including ECUs), then the principal
amount of Securities of such Series which shall be deemed to be outstanding for
the purpose of taking such action shall be that amount of Dollars that could be
obtained for such amount at the Market Exchange Rate at such time. For purposes
of this Section 10.15, "Market Exchange Rate" shall mean the noon Dollar buying
rate in New York City for cable transfers of that currency as published by the
Federal Reserve Bank of New York; provided, however, in the case of ECUs, Market
-------- -------
Exchange Rate shall mean the rate of exchange determined by the Commission of
the European Union (or any successor thereto) as published in the Official
Journal of the European Union (such publication or any successor publication,
the "Journal"). If such Market Exchange Rate is not available for any reason
with respect to such currency, the Trustee shall use, in its sole discretion and
without liability on its
46
<PAGE>
part, such quotation of the Federal Reserve Bank of New York or, in the case of
ECUs, the rate of exchange as published in the Journal, as of the most recent
available date, or quotations or, in the case of ECUs, rates of exchange from
one or more major banks in The City of New York or in the country of issue of
the currency in question or, in the case of ECUs, in Luxembourg or such other
quotations or, in the case of ECUs, rates of exchange as the Trustee, upon
consultation with the Company, shall deem appropriate. The provisions of this
paragraph shall apply in determining the equivalent principal amount in respect
of Securities of a Series denominated in currency other than Dollars in
connection with any action taken by Holders of Securities pursuant to the terms
of this Indenture.
All decisions and determinations of the Trustee regarding the Market
Exchange Rate or any alternative determination provided for in the preceding
paragraph shall be in its sole discretion and shall, in the absence of manifest
error, be conclusive to the extent permitted by law for all purposes and
irrevocably binding upon the Company and all Holders.
SECTION 10.16 Judgment Currency.
-----------------
The Company agrees, to the fullest extent that it may effectively do
so under applicable law, that (a) if for the purpose of obtaining judgment in
any court it is necessary to convert the sum due in respect of the principal of
or interest or other amount on the Securities of any Series (the "Required
Currency") into a currency in which a judgment will be rendered (the "Judgment
Currency"), the rate of exchange used shall be the rate at which in accordance
with normal banking procedures the Trustee could purchase in The City of New
York the Required Currency with the Judgment Currency on the day on which final
unappealable judgment is entered, unless such day is not a New York Banking Day,
then, to the extent permitted by applicable law, the rate of exchange used shall
be the rate at which in accordance with normal banking procedures the Trustee
could purchase in The City of New York the Required Currency with the Judgment
Currency on the New York Banking Day preceding the day on which final
unappealable judgment is entered and (b) its obligations under this Indenture to
make payments in the Required Currency (i) shall not be discharged or satisfied
by any tender, any recovery pursuant to any judgment (whether or not entered in
accordance with subsection (a)), in any currency other than the Required
Currency, except to the extent that such tender or recovery shall result in the
actual receipt, by the payee, of the full amount of the Required Currency
expressed to be payable in respect of such payments, (ii) shall be enforceable
as an alternative or additional cause of action for the purpose of recovering in
the Required Currency the amount, if any, by which such actual receipt shall
fall short of the full amount of the Required Currency so expressed to be
payable, and (iii) shall not be affected by judgment being obtained for any
other sum due under this Indenture. For purposes of the foregoing, "New York
Banking Day" means any day except a Saturday, Sunday or a legal holiday in The
City of New York on which banking institutions are authorized or required by
law, regulation or executive order to close.
47
<PAGE>
ARTICLE XI.
SINKING FUNDS
SECTION 11.1 Applicability of Article.
------------------------
The provisions of this Article shall be applicable to any sinking fund
for the retirement of the Securities of a Series, except as otherwise permitted
or required by any form of Security of such Series issued pursuant to this
Indenture.
The minimum amount of any sinking fund payment provided for by the
terms of the Securities of any Series is herein referred to as a "mandatory
sinking fund payment" and any other amount provided for by the terms of
Securities of such 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 the Securities of such
Series.
SECTION 11.2 Satisfaction of Sinking Fund Payments with Securities.
-----------------------------------------------------
The Company may, in satisfaction of all or any part of any sinking
fund payment with respect to the Securities of such Series to be made pursuant
to the terms of such Securities (1) deliver outstanding Securities of such
Series to which such sinking fund payment is applicable (other than any of such
Securities previously called for mandatory sinking fund redemption) and (2)
apply as credit Securities of such Series to which such sinking fund payment is
applicable and which have been redeemed either at the election of the Company
pursuant to the terms of such Series of Securities (except pursuant to any
mandatory sinking fund) or through the application of permitted optional sinking
fund payments or other optional redemptions pursuant to the terms of such
Securities, provided that such Securities have not been previously so credited.
Such Securities shall be received by the Trustee, together with an Officers'
Certificate with respect thereto, not later than 15 days prior to the date on
which the Trustee begins the process of selecting Securities for redemption, and
shall be credited for such purpose by the Trustee at the 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. If as a result of
the delivery or credit of Securities in lieu of cash payments pursuant to this
Section 11.2, the principal amount of Securities of such Series to be redeemed
in order to exhaust the aforesaid cash payment shall be less than $100,000, the
Trustee need not call Securities of such Series for redemption, except upon
receipt of a Company Order that such action be taken, and such cash payment
shall be held by the Trustee or a Paying Agent and applied to the next
succeeding sinking fund payment, provided, however, that the Trustee or such
--------- --------
Paying Agent shall from time to time upon receipt of a Company Order pay over
and deliver to the Company any cash payment so being held by the Trustee or such
Paying Agent upon delivery by the Company to
48
<PAGE>
the Trustee of Securities of that Series purchased by the Company having an
unpaid principal amount equal to the cash payment required to be released to the
Company.
SECTION 11.3 Redemption of Securities for Sinking Fund.
-----------------------------------------
Not less than 45 days (unless otherwise indicated in the Board
Resolution, supplemental indenture hereto or Officers' Certificate in respect of
a particular Series of Securities) prior to each sinking fund payment date for
any Series of Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing mandatory 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 of
Securities of that Series pursuant to Section 11.2, and the optional amount, if
any, to be added in cash to the next ensuing mandatory sinking fund payment, and
the Company shall thereupon be obligated to pay the amount therein specified.
Not less than 30 days (unless otherwise indicated in the Board Resolution,
Officers' Certificate or supplemental indenture in respect of a particular
Series of Securities) 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 3.2 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 3.3. Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the manner
stated in Sections 3.4, 3.5 and 3.6.
49
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed and attested, all as of the day and year first above written.
Attest: NIKE, INC.
By:_________________________________
Robert S. Falcone
Chief Financial Officer
THE FIRST NATIONAL BANK OF
CHICAGO
By:_________________________________
John R. Prendiville
Vice President
50
<PAGE>
NIKE, INC.
Reconciliation and tie between Trust Indenture Act of 1939 and
Indenture, dated as of ______________ __, 1996
(S) 310(a)(1) .......................................... 7.10
(a)(2) .......................................... 7.10
(a)(3) .......................................... Not Applicable
(a)(4) .......................................... Not Applicable
(a)(5) .......................................... 7.10
(b) .......................................... 7.10
(S) 311(a) .......................................... 7.11
(b) .......................................... 7.11
(c) .......................................... Not Applicable
(S) 312(a) .......................................... 2.6
(b) .......................................... 10.3
(c) .......................................... 10.3
(S) 313(a) .......................................... 7.6
(b)(1) .......................................... 7.6
(b)(2) .......................................... 7.6
(c)(1) .......................................... 7.6
(d) .......................................... 7.6
(S) 314(a) .......................................... 4.2, 10.5
(b) .......................................... Not Applicable
(c)(1) .......................................... 10.4
(c)(2) .......................................... 10.4
51
<PAGE>
(c)(3) .......................................... Not Applicable
(d) .......................................... Not Applicable
(e) .......................................... 10.5
(f) .......................................... Not Applicable
(S) 315(a) .......................................... 7.1
(b) .......................................... 7.5
(c) .......................................... 7.1
(d) .......................................... 7.1
(e) .......................................... 6.14
(S) 316(a) .......................................... 2.10
(a)(1)(A) .......................................... 6.12
(a)(1)(B) .......................................... 6.13
(b) .......................................... 6.8
(S) 317(a)(1) .......................................... 6.3
(a)(2) .......................................... 6.4
(b) .......................................... 2.5
(S) 318(a) .......................................... 10.1
- ------------------------
Note: This reconciliation and tie shall not, for any purpose, be
deemed to be part of the Indenture.
52
<PAGE>
Exhibit 5.01
------------
[NIKE, Inc. letterhead]
November 26, 1996
NIKE, Inc.
One Bowerman Drive
Beaverton, Oregon 94005
Re: Shelf Registration of $500,000,000
Aggregate Initial Offering Price of Debt Securities
---------------------------------------------------
Ladies and Gentlemen:
In connection with the registration statement on Form S-3 (the
"Registration Statement") filed on November 12, 1996 with the Securities and
Exchange Commission (the "SEC") under the Securities Act of 1933, as amended by
Amendment No. 1 thereto filed with the SEC on November 26, 1996, relating to the
offering from time to time, as set forth in the prospectus contained in the
Registration Statement (the "Prospectus") and as to be set forth in one or more
supplements to the Prospectus, by NIKE, Inc., an Oregon corporation (the
"Company"), of Debt Securities (the "Debt Securities") in one or more series at
an aggregate initial offering price of up to $500,000,000 or its equivalent in
another currency or composite currency, you have requested our opinion with
respect to the matters set forth below.
In my capacity as General Counsel of the Company in connection with
such registration, I am familiar with the proceedings taken and proposed to be
taken by the Company in connection with the authorization and issuance of the
Debt Securities, and for the purposes of this opinion, have assumed such
proceedings will be timely completed in the manner presently proposed. In
addition, I, or members of my staff, have made such legal and factual
examinations and inquiries, including an examination of originals or copies
certified or otherwise identified to my satisfaction of such documents,
corporate records and instruments, as I have deemed necessary or appropriate for
purposes of this opinion.
In my examination, I have assumed the genuineness of all signatures,
the authenticity of all documents submitted to me as originals, and the
conformity to authentic original documents of all documents submitted to me as
copies.
<PAGE>
NIKE, Inc.
November 26, 1996
Page 2
I am opining herein as to the effect on the subject transaction only
of the internal laws of the State of Oregon and I express no opinion with
respect to the applicability thereto, or the effect thereon, of the laws of any
other jurisdiction or as to any matters of municipal law or the laws of any
other local agencies within the State of Oregon.
Capitalized terms used herein without definition have the meanings
ascribed to them in the Registration Statement.
Subject to the foregoing and the other matters set forth herein, it is
my opinion that as of the date hereof the Debt Securities have been duly
authorized by all necessary corporate action of the Company.
I consent to your filing this opinion as an exhibit to the
Registration Statement and to the reference to me contained under the heading
"Legal Matters" in the Prospectus included therein.
Very truly yours,
/s/ Paul J. Kelly, Jr. Esq.
Paul J. Kelly, Jr., Esq.
General Counsel
<PAGE>
EXHIBIT 5.02
[LETTERHEAD OF LATHAM & WATKINS ATTORNEYS AT LAW APPEARS HERE]
November 26, 1996
NIKE, Inc.
One Bowerman Drive
Beaverton, Oregon 94005
Re: Shelf Registration of $500,000,000
Aggregate Initial Offering Price of Debt Securities
---------------------------------------------------
Ladies and Gentlemen:
In connection with the registration statement on Form S-3 (the
"Registration Statement") filed on November 12, 1996 with the Securities and
Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Securities Act"), as amended by Amendment No. 1 thereto filed with
the Commission on November 26, 1996, relating to the offering from time to time,
as set forth in the prospectus contained in the Registration Statement (the
"Prospectus") and as to be set forth in one or more supplements to the
Prospectus (each a "Prospectus Supplement"), by NIKE, Inc., an Oregon
corporation (the "Company"), of Debt Securities (the "Debt Securities") in one
or more series at an aggregate initial offering price of up to $500,000,000 or
its equivalent in another currency or composite currency, you have requested our
opinion with respect to the matters set forth below.
In our capacity as your special counsel in connection with such
registration, we are familiar with the proceedings taken and proposed to be
taken by the Company in connection with the issuance of the Debt Securities, and
for the purposes of this opinion, have assumed such proceedings will be timely
completed in the manner presently proposed. In addition, we have made such
legal and factual examinations and inquiries, including an examination of
originals or copies certified or otherwise identified to our satisfaction of
such documents, corporate records and instruments, as we have deemed necessary
or appropriate for purposes of this opinion.
<PAGE>
NIKE, Inc.
November 26, 1996
Page 2
In our examination, we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us as originals, and the
conformity to authentic original documents of all documents submitted to us as
copies.
We are opining herein as to the effect on the subject transaction only
of the internal laws of the State of New York, and we express no opinion with
respect to the applicability thereto, or the effect thereon, of the laws of any
other jurisdiction or as to any matters of municipal law or the laws of any
other local agencies within the State of New York.
Capitalized terms used herein without definition have the meanings
ascribed to them in the Registration Statement.
Subject to the foregoing and the other matters set forth herein, it is
our opinion that, as of the date hereof: (a) when the Debt Securities have been
duly established in accordance with the terms of the Indenture, duly
authenticated by the Trustee and duly executed and delivered on behalf of the
Company against payment therefor in accordance with the terms and provisions of
the Indenture and as contemplated by the Registration Statement, the Prospectus
and the related Prospectus Supplement(s), (b) when the Registration Statement
and any required post-effective amendment thereto have become effective under
the Securities Act, (c) assuming that the terms of the Debt Securities as
executed and delivered are as described in the Registration Statement, the
Prospectus and the related Prospectus Supplement(s), (d) assuming that the Debt
Securities as executed and delivered do not violate any law applicable to the
Company or result in a default under or breach of any agreement or instrument
binding upon the Company, (e) assuming that the Debt Securities as executed and
delivered comply with all requirements and restrictions, if any, applicable to
the Company, whether imposed by any court or governmental or regulatory body
having jurisdiction over the Company, and (f) assuming that the Debt Securities
are then issued and sold as contemplated in the Registration Statement, the
Prospectus and the related Prospectus Supplement(s), the Debt Securities will
constitute valid and binding obligations of the Company, enforceable against the
Company in accordance with their terms.
The opinion rendered in the paragraph above relating to the
enforceability of the Debt Securities is subject to the following exceptions,
limitations and qualifications: (i) the effect of bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to or affecting the rights and remedies of creditors; (ii) the effect
of general principles of equity, whether enforcement is considered in a
proceeding in equity or law, and the discretion of the court before which any
proceeding therefor may be brought; (iii) the unenforceability under certain
circumstances under law or court decisions of provisions providing for the
indemnification of or contribution to a party with respect to a liability where
such indemnification or contribution is contrary to public policy; (iv) we
express no opinion concerning the enforceability of the waiver of rights or
defenses contained in Section 4.4 of the Indenture; and (v) we express no
opinion with respect to whether acceleration of the Debt
<PAGE>
NIKE, Inc.
November 26, 1996
Page 3
Securities may affect the collectibility of that portion of the stated principal
amount thereof which might be determined to constitute unearned interest
thereon.
We assume for purposes of this opinion that (i) the Company has been
duly incorporated and is validly existing as a corporation under the laws of the
State of Oregon, and has the corporate power and authority to issue and sell the
Debt Securities; (ii) the Debt Securities have been duly authorized by all
necessary corporate action by the Company; (iii) the Indenture has been duly
authorized by all necessary corporate action by the Company, has been duly
executed and delivered by the Company and constitutes the legally valid, binding
and enforceable obligation of the Company enforceable against the Company in
accordance with its terms; (iv) the Trustee is duly organized, validly existing
and in good standing under the laws of its jurisdiction of organization; (v) the
Trustee is duly qualified to engage in the activities contemplated by the
Indenture; (vi) the Indenture has been duly authorized, executed and delivered
by the Trustee and constitutes the legally valid, binding and enforceable
obligation of the Trustee enforceable against the Trustee in accordance with its
terms; (vii) the Trustee is in compliance, generally and with respect to acting
as a trustee under the Indenture, with all applicable laws and regulations; and
(viii) the Trustee has the requisite organizational and legal power and
authority to perform its obligations under the Indenture.
We consent to your filing this opinion as an exhibit to the
Registration Statement and to the reference to our firm contained under the
heading "Legal Matters" in the Prospectus included therein.
Very truly yours,
/s/ Latham & Watkins
<PAGE>
Exhibit 23.01
-------------
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement on Form S-3 of our report
dated July 3, 1996, except as to Note 16, which is as of September 24, 1996,
appearing in NIKE, Inc's Current Report of Form 8-K dated September 16, 1996. We
also consent to the reference to us under the headings "Experts" and "Selected
Financial Data" in such Prospectus. However, it should be noted that Price
Waterhouse LLP has not prepared or certified such "Selected Financial Data".
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Portland, Oregon
November 26, 1996
<PAGE>
Exhibit 25.01
-------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
NIKE, Inc.
(Exact name of obligor as specified in its charter)
Oregon 93-0584541
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
One Bowerman Drive
Beaverton, Oregon 97005-6453
(Address of principal executive offices) (Zip Code)
Debt Securities
(Title of Indenture Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
-----------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
2
<PAGE>
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this Statement of Eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of Chicago
and the State of Illinois, on this 20th day of November, 1996.
The First National Bank of Chicago,
Trustee
By /s/ John R. Prendiville
John R. Prendiville
Vice President
* Exhibit 1, 2, 3 and 4 are herein incorporated by reference to Exhibits bearing
identical numbers in Item 16 of the Form T-1 of The First National Bank of
Chicago, filed as Exhibit 25.1 to the Registration Statement on Form S-3 of
SunAmerica, Inc., filed with the Securities and Exchange Commission on October
25, 1996 (Registration No. 333-14201).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
November 20, 1996
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between NIKE, Inc. and
The First National Bank of Chicago, the undersigned, in accordance with Section
321(b) of the Trust Indenture Act of 1939, as amended, hereby consents that the
reports of examinations of the undersigned, made by Federal or State authorities
authorized to make such examinations, may be furnished by such authorities to
the Securities and Exchange Commission upon its request therefor.
Very truly yours,
The First National Bank of Chicago
By /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT 7
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/96 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip Chicago, IL 60670
FDIC Certificate No.: 0/3/9/1/8
---------
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for June 30, 1996
All schedules are to be reported in thousands of dollars. Unless otherwise indicated, report the amount
outstanding of the last business day of the quarter.
Schedule RC--Balance Sheet
Dollar Amounts in C400
----
Thousands RCFD BIL MIL THOU Less Than
----------------- ---- ------------ ---------
ASSETS
- ------
<S> <C> <C> <C> <C>
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)............... 0081 3,572,641 1.a.
b. Interest-bearing balances(2)........................................ 0071 6,958,367 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)........... 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)........ 1773 1,448,974 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.................................................. 0276 5,020,878 3.a.
b. Securities purchased under agreements to resell..................... 0277 918,688 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C)..................................................................RCFD 2122 19,125,160 4.a.
b. LESS: Allowance for loan and lease losses...........................RCFD 3123 379,232 4.b.
c. LESS: Allocated transfer risk reserve...............................RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)................................ 2125 18,745,928 4.d.
5. Assets held in trading accounts........................................ 3545 9,599,172 5.
6. Premises and fixed assets (including capitalized leases)............... 2145 623,289 6.
7. Other real estate owned (from Schedule RC-M)........................... 2150 8,927 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)......................................... 2130 57,280 8.
9. Customers' liability to this bank on acceptances outstanding........... 2155 632,259 9.
10. Intangible assets (from Schedule RC-M)................................. 2143 156,715 10.
11. Other assets (from Schedule RC-F)...................................... 2160 1,592,088 11.
12. Total assets (sum of items 1 through 11)............................... 2170 49,335,206 12.
</TABLE>
- ----------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
5
<PAGE>
<TABLE>
<CAPTION>
Schedule RC-Continued
Dollar Amounts in
Thousands Bil Mil Thou
------------ ------------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1).......................................... RCON 2200 16,878,870 13.a.
(1) Noninterest-bearing(1)...........................................RCON 6631 7,855,880 13.a.(1)
(2) Interest-bearing.................................................RCON 6636 9,022,990 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)................................... RCFN 2200 12,677,057 13.b.
(1) Noninterest bearing..............................................RCFN 6631 766,936 13.b.(1)
(2) Interest-bearing.................................................RCFN 6636 11,910,121 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.............................................. RCFD 0278 1,318,968 14.a.
b. Securities sold under agreements to repurchase....................... RCFD 0279 1,197,589 14.b.
15. a. Demand notes issued to the U.S. Treasury............................. RCON 2840 104,546 15.a.
b. Trading Liabilities.................................................. RCFD 3548 6,431,784 15.b.
16. Other borrowed money:
a. With original maturity of one year or less........................... RCFD 2332 4,437,636 16.a.
b. With original maturity of more than one year........................ RCFD 2333 75,308 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases.................................................................. RCFD 2910 283,041 17.
18. Bank's liability on acceptance executed and outstanding................. RCFD 2920 632,259 18.
19. Subordinated notes and debentures....................................... RCFD 3200 1,275,000 19.
20. Other liabilities (from Schedule RC-G).................................. RCFD 2930 892,947 20.
21. Total liabilities (sum of items 13 through 20).......................... RCFD 2948 46,205,005 21.
22. Limited-Life preferred stock and related surplus........................ RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus........................... RCFD 3838 0 23.
24. Common stock............................................................ RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)................ RCFD 3839 2,349,164 25.
26. a. Undivided profits and capital reserves............................... RCFD 3632 584,878 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities..................................................... RCFD 8434 (3,951) 26.b.
27. Cumulative foreign currency translation adjustments..................... RCFD 3284 (748) 27.
28. Total equity capital (sum of items 23 through 27)....................... RCFD 3210 3,130,201 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)................................... RCFD 3300 49,335,206 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external auditors as of any Number
------
date during 1995............... RFCD 6724............ N/A M.1
------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank perforemed by other external auditors
(may be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
________________
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
6
