<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 14, 1995
REGISTRATION NO. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
ALCO STANDARD CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
OHIO 23-0334400
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
INCORPORATION OR ORGANIZATION)
P.O. BOX 834
VALLEY FORGE, PENNSYLVANIA 19482
(610) 296-8000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
J. KENNETH CRONEY, ESQUIRE
ALCO STANDARD CORPORATION
VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
P.O. BOX 834
VALLEY FORGE, PENNSYLVANIA 19482
(610) 296-8000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
COPIES TO:
ROBERT E. BUCKHOLZ, JR., ESQUIRE
SULLIVAN & CROMWELL
125 BROAD STREET
NEW YORK, NEW YORK 10004
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to
time after the Registration Statement becomes effective as determined in light
of market conditions.
---------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
PROPOSED
MAXIMUM
TITLE OF EACH CLASS AMOUNT PROPOSED AGGREGATE AMOUNT OF
OF SECURITIES TO BE OFFERING PRICE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED PER UNIT PRICE(1) FEE
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<S> <C> <C> <C> <C>
Debt Securities........
Preferred Stock........
Depositary Shares (3).. $750,000,000(2) 100%(2) $750,000,000 $150,000
Common Stock(4)(5).....
Stock Purchase
Contracts.............
Stock Purchase Units...
</TABLE>
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(1) Estimated solely for the purpose of determining the registration fee.
(2) There are being registered hereunder such principal amount or number of
Securities as may from time to time be issued at indeterminate prices, but
with an aggregate initial offering price not to exceed $750,000,000.
(3) There are being registered hereunder such indeterminate number of
Depositary Shares as may be issued in the event the Registrant elects to
offer fractional interests in shares of the Preferred Stock registered
hereunder.
(4) In addition to Common Stock that may be offered for cash, there are being
registered hereunder such indeterminate number of shares of Common Stock as
may be issuable upon conversion of the Debt Securities or Preferred Stock
being registered hereunder, to the extent any of such Debt Securities or
shares of Preferred Stock are by their terms convertible into Common Stock.
(5) Each share of Common Stock being registered hereunder includes a Common
Stock Purchase Right.
---------------
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 THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE 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 14, 1995
ALCO STANDARD CORPORATION
DEBT SECURITIES, PREFERRED STOCK,
COMMON STOCK, STOCK PURCHASE CONTRACTS
AND STOCK PURCHASE UNITS
-----------
Alco Standard Corporation (the "Company" or "Alco") may from time to time
offer Debt Securities consisting of debentures, notes and/or other unsecured
evidences of indebtedness in one or more series; Preferred Stock in one or more
series (which may include Depositary Shares representing fractional interests
in shares of Preferred Stock); shares of Common Stock; Stock Purchase Contracts
to purchase Preferred Stock or Common Stock; and Stock Purchase Units, each
representing ownership of a Stock Purchase Contract and Debt Securities or debt
obligations of third parties, including U.S. Treasury Securities, securing the
holder's obligation to purchase the Preferred Stock or Common Stock under the
Stock Purchase Contract (collectively, the "Securities"), from which the
Company will receive proceeds of up to an aggregate of $750,000,000. The Debt
Securities, Preferred Stock, Common Stock, Stock Purchase Contracts and Stock
Purchase Units may be offered independently or together in any combination for
sale directly to purchasers or through dealers, underwriters or agents to be
designated. The Securities will be offered to the public on terms determined by
market conditions.
The specific designation, aggregate principal amount, purchase price,
maturity, rate (or method of calculation thereof) and time of payment of
interest, if any, any conversion or exchange provisions, any redemption
provisions, any subordination provisions and other specific terms not set forth
herein of the Debt Securities in respect of which this Prospectus is being
delivered; the specific title, number of shares, dividend rate (or method of
calculation), liquidation preferences, any conversion or exchange provisions,
any redemption provisions, any other specific terms of the Preferred Stock and
any Depositary Shares in respect of which this Prospectus is being delivered;
any listing on a securities exchange of the Securities in respect of which this
Prospectus is being delivered; and the names of any underwriters, dealers or
agents, and the other terms and manner of the sale and distribution of such
Securities, are set forth in the accompanying Prospectus Supplement. See
"Description of Debt Securities", "Description of Capital Stock", "Description
of Depositary Shares" and "Plan of Distribution".
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
-----------
THE DATE OF THIS PROSPECTUS IS , 1995.
<PAGE>
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS OR
THE PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY ALCO OR ANY
UNDERWRITER. THIS PROSPECTUS AND THE PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN
OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES
OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE
SUCH OFFER IN SUCH JURISDICTION.
----------------
AVAILABLE INFORMATION
Alco is subject to the informational requirements of the Securities Exchange
Act of 1934 (the "1934 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 filed
by Alco with the Commission can be inspected and copied at the offices of the
Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549 and at the following Regional Offices of the Commission: New York
Regional Office, Seven World Trade Center, New York, New York 10048, and
Chicago Regional Office, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. Copies of such material can also be obtained from the Public Reference
Section of the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, at prescribed rates. Such material can also be
inspected at the New York, Philadelphia and Chicago Stock Exchanges on which
Alco's common stock is listed.
DOCUMENTS INCORPORATED BY REFERENCE
Alco's Annual Report on Form 10-K for the fiscal year ended September 30,
1995, heretofore filed by Alco with the Commission, is incorporated herein by
reference.
All documents filed by Alco pursuant to Section 13(a), 13(c), 14 or 15(d) of
the 1934 Act subsequent to the date of this Prospectus and prior to the
termination of the offering of the Securities shall be deemed to be
incorporated by reference in this Prospectus and to be a part hereof from the
date of filing of such documents. This Prospectus does not contain all
information set forth in the Registration Statement and Exhibits thereto which
Alco has filed with the Commission and to which reference is made hereby.
Alco will provide without charge to each person, including any beneficial
owner, to whom a copy of this Prospectus is delivered, on the written or oral
request of any such person, a copy of any or all of the documents referred to
above which have been incorporated in this Prospectus by reference, other than
exhibits to such documents (unless such exhibits are specifically incorporated
by reference in such documents). Requests for such copies should be directed
to: Corporate Affairs Department, Alco Standard Corporation, P.O. Box 834,
Valley Forge, Pennsylvania 19482 (telephone number: (610) 296-8000).
2
<PAGE>
THE COMPANY
Alco Standard Corporation ("Alco" or the "Company") is a marketing,
distribution, and services company with operations in two primary businesses:
Alco Office Products ("AOP") and Unisource ("Unisource"). Alco's fiscal 1995
revenues were approximately $9.9 billion and its operating income was $477
million.
AOP is the largest independent copier distribution network in North America
and the United Kingdom, with a presence in Europe. AOP has more than 813
locations in forty-eight states, six Canadian provinces and Europe. AOP sells,
rents and leases copiers, fax machines and other automated office equipment.
AOP also provides equipment services and supplies, reprographic facilities
management and specialized document copying services. Through its captive
leasing companies, AOP finances equipment leases for customers of AOP companies
throughout the United States, Canada and the United Kingdom. In fiscal 1995,
AOP's revenues were $2.9 billion and its operating income was $252 million.
Unisource is North America's largest marketer and distributor of paper and
imaging products and supply systems, which includes disposable paper and
plastic products, packaging systems and supplies, and sanitary maintenance
supplies. Unisource has 380 facilities, which are located in every major
metropolitan market in the United States, in every province of Canada and in
Mexico. Unisource focuses on five market segments: commercial printing,
business imaging, general manufacturing, food processing and retail grocery.
Unisource combines its broad array of products with specialized customer
services and is implementing a sophisticated information technology system to
offer custom solutions which lower the total customer cost of procurement and
improve the efficiency of customers' operations. In fiscal 1995, Unisource's
revenues were $7.0 billion and its operating income was $225 million.
Alco is managed as "The Corporate Partnership." Under this entrepreneurial
philosophy, field executives maintain a high degree of operating autonomy over
issues that affect the Company's ability to serve customers, while financial
and administrative support is provided on a centralized basis.
The address of Alco's principal executive offices is P.O. Box 834, Valley
Forge, Pennsylvania 19482, telephone number (610) 296-8000.
3
<PAGE>
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the historical ratios of earnings to fixed
charges of Alco for the periods indicated:
<TABLE>
<CAPTION>
FISCAL YEAR ENDED
SEPTEMBER 30
------------------------
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges................ 3.8 3.7 1.3 3.5 2.8
Ratio of Earnings to Fixed Charges (Excluding Cap-
tive Finance Subsidiaries)....................... 4.7 4.4 1.4 4.2 3.3
</TABLE>
For purposes of calculating this ratio, earnings consist of income from
continuing operations before provisions for income taxes and excluding the loss
from unconsolidated affiliate, plus fixed charges. Fixed charges include
interest expense on indebtedness, and an estimate of the interest component of
rental expense. The first ratio gives effect to the consolidation of the
captive finance subsidiaries of AOP. The second ratio excludes the income from
continuing operations before provision for income taxes, and the fixed charges,
attributable to those captive finance subsidiaries. The 1993 ratios include the
Unisource $175 million ($113 million net of taxes) restructuring charge; if the
restructuring charge were excluded for 1993, the ratios would be 3.3 (including
captive finance subsidiaries) and 4.2 (excluding captive finance subsidiaries).
RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The following table sets forth the historical ratios of earnings to fixed
charges and preferred stock dividends of Alco for the periods indicated:
<TABLE>
<CAPTION>
FISCAL YEAR ENDED
SEPTEMBER 30
------------------------
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges and Preferred
Stock Dividends.................................. 3.2 3.1 1.1 3.5 2.8
Ratio of Earnings to Fixed Charges and Preferred
Stock Dividends (Excluding Captive Finance
Subsidiaries).................................... 3.7 3.5 1.1 4.2 3.2
</TABLE>
For purposes of calculating this ratio, earnings consist of income from
continuing operations before provisions for income taxes and preferred stock
dividends and excluding the loss from unconsolidated affiliate, plus fixed
charges. Fixed charges include interest expense on indebtedness, and an
estimate of the interest component of rental expense. Preferred stock dividends
include the pretax earnings required to cover preferred stock dividend
requirements. The first ratio gives effect to the consolidation of the captive
finance subsidiaries of AOP. The second ratio excludes the income from
continuing operations before provision for income taxes, and the fixed charges
attributable to those captive finance subsidiaries. The 1993 ratios include the
Unisource $175 million ($113 million net of taxes) restructuring charge; if the
restructuring charge were excluded for 1993, the ratios would be 2.8 (including
captive finance subsidiaries) and 3.4 (excluding captive finance subsidiaries).
USE OF PROCEEDS
Unless otherwise specified in the Prospectus Supplement which accompanies
this Prospectus, the net proceeds from the sale of the Securities will be added
to the general funds of Alco and may be used to finance the acquisition of new
companies and for general corporate purposes, including capital expenditures
and working capital requirements.
4
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The following description sets forth the material terms and provisions of the
Debt Securities to which the accompanying Prospectus Supplement may relate. The
particular terms and provisions of any series of Debt Securities offered by the
Prospectus Supplement, and the extent to which such general terms and
provisions described below may apply thereto, are described in the Prospectus
Supplement relating to such series of Debt Securities.
The Debt Securities will be issued under an Indenture (the "Indenture")
between Alco and First Fidelity Bank, N.A., as Trustee (the "Trustee"), a form
of which is filed as an exhibit to the Registration Statement filed with the
Commission. Wherever particular sections or defined terms of the Indenture are
referred to, it is intended that such sections or defined terms shall be
incorporated herein by reference.
GENERAL
The Indenture does not limit the amount of Debt Securities which can be
issued thereunder and provides that Debt Securities may be issued thereunder up
to the aggregate principal amount which may be authorized from time to time by
Alco. Reference is made to the Prospectus Supplement which accompanies this
Prospectus for the following terms and other information with respect to any
Debt Securities being offered thereby: (i) the designation, aggregate principal
amount and authorized denominations of such Debt Securities; (ii) the
percentage of the principal amount at which such Debt Securities will be
issued; (iii) the date or dates on which such Debt Securities will mature; (iv)
the rate or rates per annum at which such Debt Securities will bear interest,
if any, or the method of determination of such rate; (v) the time or times at
which any such interest will be payable, the record dates for such interest
payments and the date or dates from which interest will accrue; (vi) the place
or places where the principal (and premium, if any) and interest will be
payable; (vii) whether such Debt Securities will be convertible into or
exchangeable for Common Stock or other securities of Alco, and the terms and
conditions of any such conversions or exchanges; (viii) whether such Debt
Securities will be subordinated to other indebtedness of the Company, and the
terms and conditions of any such subordination; and (ix) any redemption or
sinking fund provisions, additional restrictive covenants or other terms of
such Debt Securities. (Section 301)
Unless otherwise specified in the Prospectus Supplement which accompanies
this Prospectus, principal, premium, if any, and interest, if any, are to be
payable at the Corporate Trust Office of the Trustee or its successors in The
City of New York, or at any other office or agency maintained by Alco for such
purposes, provided that payment of interest, if any, may be made at the option
of Alco by check mailed to the persons in whose names the Debt Securities are
registered at the close of business on the day specified in the Prospectus
Supplement accompanying this Prospectus. (Sections 202 and 1002)
The Debt Securities will be issued only in fully registered form, without
coupons. (Section 302) The Debt Securities will be exchangeable for other Debt
Securities of the same series of a like aggregate principal amount in
authorized denominations and will be transferable at any time or from time to
time at the Corporate Trust Office of the Trustee or at any other office or
agency of Alco maintained for that purpose. No service charge will be made for
any such exchange or transfer of Debt Securities, but Alco may require payment
of a sum sufficient to cover any tax or other governmental charge payable in
connection therewith. (Section 305)
Debt Securities of a single series may be issued at various times with
different maturity dates, may bear interest at different rates and may
otherwise vary.
One or more series of Debt Securities may be sold at a substantial discount
below their stated principal amount, bearing no interest or interest at a rate
which at the time of issuance is below market rates. Federal
5
<PAGE>
income tax consequences and special considerations applicable to any such
series will be described in the Prospectus Supplement relating thereto.
SENIOR DEBT
The Debt Securities will be unsecured and will rank on a parity with all
other unsecured and unsubordinated indebtedness of Alco. Unless otherwise
indicated in the Prospectus Supplement relating to the Debt Securities, the
covenants contained in the Indenture and the Debt Securities would not
necessarily afford Holders of the Debt Securities protection in the event of a
highly leveraged or other transaction involving Alco or a sudden and dramatic
decline in credit quality resulting from an acquisition of Alco, or a
recapitalization or similar restructuring of Alco, that may adversely affect
Holders.
CERTAIN RESTRICTIVE PROVISIONS
Alco covenants in the Indenture that so long as any of the Debt Securities
remain outstanding, it will not, nor will it permit any Restricted Subsidiary
(as defined, see "Definition of Certain Terms" below) to create or assume any
mortgage, security interest, pledge or lien of or upon any Principal Property
(as defined) or shares of capital stock or indebtedness of any Restricted
Subsidiary (whether such Principal Property, shares of stock or indebtedness
are now owned or hereafter acquired) without making effective provision whereby
the Outstanding Debt Securities shall be secured equally and ratably with any
and all other indebtedness or obligations thereby secured. This restriction,
however, shall not apply to: (i) liens on any Principal Property existing at
the time that it is acquired, or liens on any Principal Property acquired,
constructed or improved by Alco or a Restricted Subsidiary which are created or
assumed contemporaneously with, or within 180 days after (or in certain cases,
360 days after) the completion of such acquisition, construction or improvement
to secure the purchase price of such property or the cost of such construction
or improvement; (ii) liens on property or shares of capital stock or
indebtedness of a corporation existing at the time such corporation is merged
into or consolidated with Alco or a Restricted Subsidiary or at the time of a
sale, lease or other disposition of the properties of a corporation as an
entirety or substantially as an entirety to Alco or a Restricted Subsidiary;
(iii) liens on property or shares of capital stock or indebtedness of a
corporation existing at the time such corporation becomes a Restricted
Subsidiary; (iv) liens to secure indebtedness of a Restricted Subsidiary to
Alco or to another Restricted Subsidiary; (v) liens in favor of the United
States of America or any state thereof, or any department, agency or political
subdivision of the United States of America or any state thereof, to secure
partial, progress, advance or other payments pursuant to any contract or
statute, including, without limitation, liens to secure indebtedness
represented by pollution control or industrial revenue bonds, or to secure any
indebtedness incurred for the purpose of financing all or any part of the
purchase price or the cost of constructing or improving the property subject to
such liens; (vi) liens in favor of any customer arising in respect of partial,
progress, advance or other payments made by or on behalf of such customer for
goods produced for or services rendered to such customer in the ordinary course
of business not exceeding the amount of such payments; (vii) liens existing at
the date of the Indenture; (viii) mechanics', workers', repairmen's,
materialmen's, warehousemen's, carriers' or other similar liens arising in the
ordinary course of business; (ix) pledges or deposits under the workers'
compensation laws or similar legislation and liens of judgments thereunder
which are not currently dischargeable, or good faith deposits in connection
with bids, tenders, contracts (other than for the payment of money) or leases
to which Alco or any Restricted Subsidiary is a party, or deposits in
connection with obtaining or maintaining self-insurance or to obtain the
benefits of any law, regulation or arrangement pertaining to unemployment
insurance, old age pensions, social security or similar matters, or deposits of
cash or obligations of the United States of America to secure surety, appeal or
customs bonds to which Alco or any Restricted Subsidiary is a party, or
deposits in litigation or other proceedings such as, but not limited to,
interpleader proceedings; (x) liens created by or resulting from any litigation
or proceedings which are being contested in good faith; liens arising out of
judgments or awards against Alco or any Restricted Subsidiary with respect to
which Alco or such Restricted Subsidiary is in good faith prosecuting an appeal
or proceedings for review; or liens incurred by Alco or any Restricted
Subsidiary for the purpose of obtaining a stay or discharge in the course of
any legal proceeding to which Alco or such Restricted Subsidiary is a party;
(xi) liens for taxes or assessments or
6
<PAGE>
governmental charges or levies not yet due or delinquent, or which can
thereafter be paid without penalty, or which are being contested in good faith
by appropriate proceedings; landlord's liens on property held under lease, and
tenants' rights under leases; and easements; (xii) other liens incidental to
the conduct of the business or the ownership of the property and assets of Alco
or a Restricted Subsidiary which were not incurred in connection with the
borrowing of money or the obtaining of advances or credit, and which do not, in
the opinion of Alco, materially detract from the value of the property or
assets or materially impair the use thereof in the operation of the business of
Alco and its Restricted Subsidiaries taken as a whole; or (xiii) any extension,
renewal or replacement (or successive extensions, renewals or replacements), in
whole or in part, of any liens referred to in the foregoing clauses (i) through
(xii), inclusive. (Section 1006)
Sale and leaseback transactions by Alco or any Restricted Subsidiary of any
Principal Property owned for more than 180 days (except for leases of not more
than three years and except for leases between Alco and a Restricted Subsidiary
or between Restricted Subsidiaries) are prohibited unless (i) Alco or such
Restricted Subsidiary would be entitled to incur indebtedness secured by a lien
on such property without equally and ratably securing the Debt Securities
pursuant to the restrictions on liens described above, or (ii) Alco shall apply
an amount equal to the Attributable Debt (as defined) of such transaction to
(a) the acquisition of one or more Principal Properties of equal or greater
aggregate fair market value and/or (b) the retirement of indebtedness for
borrowed money, including the Debt Securities, incurred by Alco or any
Restricted Subsidiary (other than indebtedness for borrowed money owed to Alco
or any Restricted Subsidiary), provided that the amount to be applied to the
retirement of such indebtedness shall be reduced by (1) the principal amount of
any Debt Securities delivered within 180 days after such sale to the Trustee
for retirement or cancellation, and (2) the principal amount of such
indebtedness, other than Debt Securities, voluntarily retired by Alco within
180 days after such sale. No retirement referred to in the foregoing clause
(ii)(b), however, may be effected by payment at maturity or pursuant to any
mandatory sinking fund payment or mandatory prepayment provision. (Section
1007)
Notwithstanding the foregoing restrictions on liens and sale and leaseback
transactions, Alco and its Restricted Subsidiaries may, without securing the
Debt Securities, acquiring one or more Principal Properties or retiring
indebtedness for borrowed money, create or assume liens and enter into sale and
leaseback transactions if the aggregate amount of all such liens and sale and
leaseback transactions outstanding at the time such lien is assumed or created
or such sale and leaseback transaction is entered into, as measured by all
indebtedness secured by all such liens then outstanding or to be so created or
assumed (and after giving effect to the retirement of any indebtedness or
obligations which are concurrently being retired) and the Attributable Debt of
all such sale and leaseback transactions then outstanding or to be so entered
into, would not exceed 10% of Alco's Consolidated Net Assets (as defined), as
determined in accordance with the most recent published balance sheet of Alco
and after giving effect to the receipt and application of any proceeds of all
indebtedness secured by all such liens to be created or assumed and of any sale
and leaseback transactions to be entered into. (Section 1008)
DEFINITION OF CERTAIN TERMS
"Attributable Debt" is defined as the present value (discounted as provided
in the Indenture) of the obligation of a lessee for rental payments during the
remaining term of any lease. (Section 1006)
"Consolidated Net Assets" is defined as the total of all assets (after
deducting all current liabilities) appearing on a consolidated balance sheet of
Alco and its consolidated subsidiaries, prepared in accordance with generally
accepted accounting principles, with the assets determined at their net book
values (after deducting related depreciation, depletion, amortization and other
valuation reserves). (Section 1006)
"Principal Property" is defined as any manufacturing plant, research facility
or warehouse located within the United States of America owned or leased by
Alco or any Restricted Subsidiary which has a net book value exceeding 2 1/2%
of Alco's Consolidated Net Assets, unless, in the opinion of the board of
directors of
7
<PAGE>
Alco, such property (or a portion thereof) is not of material importance to the
total business conducted by Alco as an entirety. (Section 1006)
"Restricted Subsidiary" is defined to mean any Subsidiary which owns a
Principal Property. (Section 1006)
"Subsidiary" is defined to mean a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by Alco
and/or by one or more of its other Subsidiaries. (Section 101)
MERGER AND CONSOLIDATION
The Indenture provides that Alco may, without the consent of the Holders of
Debt Securities of any series, consolidate with or merge with or into any other
corporation, or convey, transfer or lease its properties and assets
substantially as an entirety to any person, provided that in any such case (i)
the successor corporation shall be a domestic corporation and such corporation
shall assume by a supplemental indenture Alco's obligations under the
Indenture, (ii) immediately after giving effect to such transaction, no Event
of Default shall have occurred and be continuing, and (iii) if, as a result of
any such transaction, the properties or assets of Alco would be subject to any
lien not permitted under the restrictions on liens described above, the Debt
Securities will be secured equally and ratably with (or prior to) all
indebtedness secured thereby. Upon compliance with these provisions by a
successor corporation, Alco (except in the case of a lease) would be relieved
of its obligations under the Indenture and the Debt Securities. (Sections 801
and 802)
MODIFICATION AND AMENDMENT
The rights and obligations of Alco and the rights of the Holders may be
modified with respect to one or more series of Debt Securities issued under the
Indenture with the consent of the Holders of not less than a majority in
principal amount of the Outstanding Debt Securities of each series so affected,
provided that no such modification or amendment may, without the consent of the
Holder of each Debt Security affected thereby: (i) change the Stated Maturity
of the principal of, or any installment of principal of or interest on, any
such Debt Security; (ii) reduce the principal amount of, or the rate of
interest, if any, on, or any premium payable upon the redemption of any Debt
Security; (iii) reduce the amount of the principal of an Original Issue
Discount Security that would be due and payable upon a declaration of
acceleration of the Maturity thereof; (iv) change the place of payment where,
or the coin or currency in which, any Debt Security or any premium or interest
thereon is payable; (v) impair the right to institute suit for the enforcement
of any payment on or with respect to any such Debt Security; (vi) reduce the
above stated percentage of Outstanding Debt Securities necessary to modify or
amend the Indenture; (vii) reduce the percentage of aggregate principal amount
of Outstanding Debt Securities for waiver of compliance with certain provisions
of the Indenture or for waiver of certain defaults; or (viii) modify (with
certain exceptions) any provisions of the Indenture relating to modification
and amendment of the Indenture or waiver of compliance with conditions and
defaults thereunder. (Section 902)
EVENTS OF DEFAULT
The Indenture defines an Event of Default with respect to any series of Debt
Securities as being any one of the following events and such other event as may
be established for the Debt Securities of a particular series: (i) failure to
pay principal of (or premium, if any, on) any Debt Security of that series when
due; (ii) failure to pay any interest installment on any Debt Security of that
series when due, continued for 30 days; (iii) failure to deposit any sinking
fund payment on any Debt Security of that series when due; (iv) failure to
perform any other covenant of Alco (other than a covenant included in the
Indenture solely for the benefit of series of Debt Securities other than that
series), continued for 60 days after receipt of written notice by Alco; (v)
failure to pay when due, or acceleration pursuant to the terms of any agreement
or instrument of the maturity of, any indebtedness of Alco for borrowed money,
if such indebtedness aggregates $10,000,000 or more and such indebtedness is
not discharged or such acceleration is not rescinded or annulled within 10
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days after receipt of written notice by Alco; (vi) certain events in
bankruptcy, insolvency or reorganization in respect of Alco; and (vii) any
other defaults provided with respect to Debt Securities of that series.
(Section 501) An Event of Default with respect to a particular series of Debt
Securities issued under the Indenture does not necessarily constitute an Event
of Default with respect to any other series of Debt Securities issued
thereunder. The Trustee may withhold notice to the Holders of any series of
Debt Securities of any default with respect to such series (except in the
payment of principal, premium or interest or the making of any sinking fund
payment) if it considers such withholding to be in the interests of such
Holders. (Section 602)
If an Event of Default (as defined) shall occur and be continuing with
respect to any series of Debt Securities, either the Trustee or the Holders of
at least 25% in principal amount of the Outstanding Debt Securities of such
series (or, if the Debt Securities of that series are Original Issue Discount
Securities, such portion of the principal amount as may be specified in the
terms of that series) may accelerate the maturity of such series; provided,
however, that after such acceleration, but before a judgment or decree based on
such acceleration, the Holders of a majority in principal amount of such series
may rescind and annul such acceleration under certain circumstances. (Section
502) The Holders of a majority in principal amount of the Outstanding Debt
Securities of such series may waive any past default under the Indenture,
except a default in the payment of principal, premium, if any, or interest or
in the making of any sinking fund payment or in respect of a covenant or
provision which cannot be modified or amended without the consent of each of
the Holders of affected Debt Securities. (Section 513)
Except as otherwise provided in the provisions of the Indenture relating to
the duties of the Trustee in case an Event of Default (as defined) shall occur
and be continuing, the Trustee will be under no obligation to exercise any of
its rights or powers under the Indenture at the request or direction of any of
the Holders, unless such Holders shall have offered to the Trustee reasonable
security or indemnity. (Section 603) Subject to such provisions for the
indemnification of the Trustee, the Holders of a majority in principal amount
of the Outstanding Debt Securities of any series affected 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 such series. (Section 512)
Alco is required to furnish to the Trustee annually a statement as to any
default under the Indenture. (Section 1009)
DEFEASANCE AND COVENANT DEFEASANCE
The Indenture provides, if such provision is made applicable to the Debt
Securities of any series pursuant to Section 301 of the Indenture, that Alco
may elect either (i) to defease and be discharged from any and all obligations
with respect to such Debt Securities (except for the obligations to register
the transfer or exchange of such Debt Securities, to replace temporary or
mutilated, destroyed, lost or stolen Debt Securities, to maintain an office or
agency in respect of the Debt Securities and to hold moneys for payment in
trust) ("defeasance") or (ii) to be released from its obligations with respect
to such Debt Securities under the covenants described above under "Certain
Restrictive Provisions," in which case the events specified above in clauses
(iv) (insofar as it relates to such covenants) and (v) under "Events of
Default" shall no longer be Events of Default in respect of such Debt
Securities ("covenant defeasance"), in either case upon the deposit with the
Trustee (or other qualifying trustee), in trust for such purpose, of money,
and/or U.S. Government Obligations (as defined) which through the payment of
principal and interest in accordance with their terms will provide money, in an
amount sufficient to pay the principal of (and premium, if any) and interest on
such Debt Securities and any mandatory sinking fund or analogous payments
thereon on the scheduled due dates therefor. Such a trust may only be
established if, among other things, Alco has delivered to the Trustee an
opinion of counsel (as specified in the Indenture) to the effect that the
Holders of such Debt Securities will not recognize income, gain or loss for
Federal income tax purposes as a result of such defeasance or covenant
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
defeasance or covenant defeasance had not occurred. Such opinion, in the case
of defeasance under clause (i) above, must refer to and be based upon a ruling
of the
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Internal Revenue Service or a change in applicable Federal income tax law
occurring after the date of the Indenture. (Sections 1301, 1302, 1303 and 1304)
REGARDING THE TRUSTEE
From time to time, the Trustee extends credit to, and performs other
customary banking services for, Alco in the ordinary course of business.
DESCRIPTION OF CAPITAL STOCK
The Company is currently authorized to issue 150,000,000 shares of Common
Stock and 2,135,878 shares of Serial Preferred Stock ("Preferred Stock"). Both
classes are without par value. The Common Stock is subject to the express terms
of the Preferred Stock. The Preferred Stock may be issued from time to time in
one or more series, without stockholder approval, with such designations,
preferences and relative rights, and qualifications, limitations, or
restrictions thereof as shall be adopted by the Board of Directors. Two series
of Preferred Stock are outstanding. The particular terms and provisions of any
series of Preferred Stock offered by the Prospectus Supplement, and the extent
to which such general terms and provisions described below may apply thereto,
are described in the Prospectus Supplement relating to such series of Preferred
Stock.
DIVIDEND RIGHTS
Common Stock. Dividends and other distributions of assets may be made with
respect to the Common Stock from time to time by the Board of Directors within
the limits and from the sources permitted by law after payment or provision for
payment of all accrued and unpaid dividends (which are cumulative) on the
Preferred Stock, so long as there is no default in any sinking fund provisions
for the Preferred Stock.
Preferred Stock. The outstanding Preferred Stock is entitled to payment of
annual per share dividends as follows: Series AA, $237.50 ($2.375 per
Depositary Share) through January 2, 1996 and $325.00 ($3.25 per Depositary
Share) thereafter; and Series BB, $504.00 ($5.04 per Depositary Share).
So long as any shares of Preferred Stock are outstanding, the Company may not
(a) declare or pay any dividends (other than dividends payable in Common Stock
or other shares of the Company ranking junior to the Preferred Stock) to
holders of Common Stock or shares of the Company of any other class ranking on
a parity with or junior to the Preferred Stock, or (b) make any distributions
of assets (directly or indirectly, by purchase, redemption or otherwise) to the
holders of Common Stock or shares of the Company of any other class ranking on
a parity with or junior to the Preferred Stock (except in the case of shares
purchased in compromise of claims, or to prevent loss on doubtful debts and
except in the case of shares purchased out of the proceeds of the sale of
Common Stock or other shares ranking junior to the Preferred Stock received by
the Company, subsequent to January 1, 1968):
(a) Unless all accrued and unpaid dividends on shares of Preferred Stock,
including the full dividends for the then quarterly dividend period, shall
have been paid or declared and funds sufficient for payment thereof set
apart; and
(b) Unless there shall be no arrearages with respect to redemption of
shares of Preferred Stock from any sinking fund provided therefor.
No dividends may be paid upon or declared or set apart for any of the
Preferred Stock for any quarterly dividend period unless at the same time a
like proportionate dividend for the same quarterly dividend period, ratably in
proportion to the respective annual dividend rates fixed therefor, shall be
paid upon or declared or set apart for all Preferred Stock of all series then
issued and outstanding and entitled to receive such dividend.
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PREEMPTIVE RIGHTS
Common Stock. The holders of Common Stock do not have any preemptive right to
purchase or have offered to them for purchase any shares or other securities of
the Company.
Preferred Stock. The only preemptive right of holders of Preferred Stock is
to participate in certain distributions, if any were to be made by the Company,
to holders of Common Stock of options or rights to acquire Common Stock, or of
evidences of the Company's debt or assets (other than cash).
COMMON STOCK PURCHASE RIGHTS
In February 1988, the Company declared and paid a dividend distribution of
one right for each outstanding share of Common Stock. The Rights become
exercisable ten days (or such later date, not beyond thirty days, as is fixed
by the Board of Directors) after the earlier of: (a) public announcement that
an individual or group has acquired or obtained the right to acquire 20% or
more of the Company's Common Stock or (b) an individual or group commences or
announces an intention to commence a tender or exchange offer that could result
in the acquisition of 30% or more of such securities (the "Separation Date").
When exercisable, each Right entitles the holder to purchase one one-hundredth
of a share of Alco's Series 12 Preferred Stock for $75 (the "Exercise Price"),
subject to adjustment. Further, if any person or group owning 20% or more of
Alco's outstanding Common Stock (a) engages in certain self-dealing practices
with the Company, or (b) causes the Company to forego or reduce quarterly
dividends or take an action which would result in a more than 2% increase in
the other entity's proportionate share of the Company's outstanding shares; or
if any person or group acquires 30% or more of the Company's outstanding stock,
each Right would entitle the holder thereof to acquire for the Exercise Price
shares of Common Stock having a market value equal to twice the Right's
exercise price.
If the Company were acquired in a merger or other business combination, or if
more than 50% of its earning power or assets were sold in one transaction or a
series of transactions, each Right would entitle the holder thereof to purchase
shares of the acquiring company's common stock having a market value equal to
twice the Right's exercise price. The Rights that are or were held by a person
or group owning 20% or more of Alco's outstanding voting securities become void
if such person or group engages in an event which entitles holders of the
Rights to purchase Common Stock or common stock of the acquiring company having
a market value equal to twice the Right's exercise price.
The Rights, which expire on February 10, 1998, are non-voting and may be
redeemed by Alco at a price of $.05 per Right any time prior to ten days after
public announcement that a person has acquired 20% or more of the Company's
outstanding voting securities. Until the Separation Date, the Rights are
transferable with and only with the Common Stock.
VOTING RIGHTS
Common Stock. Subject to certain voting rights of holders of the Preferred
Stock to vote in certain circumstances and with respect to certain matters as a
class, the holders of the Common Stock currently have full voting rights upon
all matters presented for shareholder action. Shareholders do not have the
right to cumulate votes in electing directors.
Preferred Stock. The holders of Preferred Stock are entitled to one vote per
share, and except as otherwise provided by specific provisions of the Company's
Articles of Incorporation or by Ohio law, to vote on all matters together with
the holders of Common Stock as one class. The holders of Preferred Stock are
not entitled to cumulate votes in electing directors. The Articles of
Incorporation of Alco provide that in the event of default in the payment, in
whole or in part, of six quarterly dividends on the Preferred Stock, whether or
not consecutive, the holders of shares of Preferred Stock will be entitled to
elect two directors of the Company, to serve in addition to the directors
otherwise elected. Such right to elect additional directors is in lieu of the
other rights of the holders of Preferred Stock to vote for directors, and will
remain in effect until
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no quarterly dividend is in default. It is also provided that the vote or
written consent of at least two-thirds of the outstanding shares of Preferred
Stock voting as a class is necessary to effect (i) any amendment or repeal of
any of the provisions of the Articles of Incorporation or the Code of
Regulations of Alco which affects the voting powers, rights, privileges or
preferences of the holders of the Preferred Stock, (ii) the authorization or
issue of any stock, or any security convertible into any stock, ranking prior
to the Preferred Stock, (iii) the purchase or redemption of less than all the
Preferred Stock then outstanding (except in accordance with a stock purchase
offer made to all holders of Preferred Stock) when any dividends or sinking
fund obligations on the Preferred Stock are in arrears, or (iv) the sale, lease
or conveyance by Alco of all or substantially all of its property or business,
its voluntary liquidation or dissolution, or its consolidation with or merger
into any other corporation, unless the resulting corporation will have no
shares authorized or outstanding ranking prior to or on a parity with the
Preferred Stock except the same number with the same rights and preferences as
those of the Company authorized and outstanding immediately preceding such
consolidation or merger, and unless each holder of Preferred Stock immediately
prior thereto receives the same number of shares, with the same rights and
preferences, of the resulting corporation. It is further provided that the vote
or written consent of two-thirds of the holders of shares of any series is
necessary to amend the Articles of Incorporation or Code of Regulations of the
Company in such a way as to affect adversely and particularly the preferences,
rights, powers or privileges of such series. No such vote or consent of the
holders of Preferred Stock or any series thereof is required if provision has
been made for the redemption of all of the Preferred Stock (or any series
thereof). In addition, the Company may not create additional classes of stock
or increase the authorized number of shares of Preferred Stock ranking on a
parity with the Preferred Stock with respect, in each case, to the payment of
dividends and amounts upon liquidation, dissolution and winding up without the
vote or written consent of at least a majority of the outstanding shares of
Preferred Stock voting as a class.
REDEMPTION PROVISIONS AND SINKING FUND
Common Stock. The Common Stock is not redeemable.
Preferred Stock. The directors are empowered to determine any redemption
rights and price of each series of the Preferred Stock.
The Series AA Preferred Stock and the Depositary Shares representing such
stock are not redeemable prior to January 9, 1996. On and after January 9, 1996
and until January 9, 2000, the Series AA Preferred Stock will be redeemable, in
whole or in part, at the option of the Company, for such number of shares of
Common Stock as are issuable at a conversion price of $22.32 per share of
Common Stock (equivalent to an approximate conversion rate of 2.2402 shares of
Common Stock for each Depositary Share), subject to adjustment in certain
circumstances. The Company may exercise this option only if for 20 trading days
within any period of 30 consecutive trading days, including the last trading
day of such 30 trading day period, the closing price of the Common Stock on the
New York Stock Exchange ("NYSE") exceeds $29.02, subject to adjustment in
certain circumstances. Subject to the market price of the Common Stock, Alco
intends to exercise its option to redeem all of the Series AA Preferred Stock
as of January 9, 1996. On and after January 9, 2000 (if the option to redeem is
not previously exercised by Alco) the Series AA Preferred Stock will be
redeemable, in whole or in part at the option of the Company, for cash at a
redemption price equivalent to $50.00 per Depositary Share, plus accrued and
unpaid dividends. The Series AA Preferred Stock is not entitled to the benefit
of any sinking fund.
The Series BB Preferred Stock and the Depositary Shares representing such
stock are not redeemable.
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CONVERSION RIGHTS
Common Stock. The Common Stock is not convertible into any other security.
Preferred Stock. The directors are empowered to determine whether the shares
of any series of the Preferred Stock will be convertible into Common Stock,
and, if so, the conversion price or prices and the other terms or provisions of
such rights. Series AA is convertible at any time prior to the close of
business on the redemption date thereof at a conversion price of $22.32 per
share of Common Stock (equivalent to an approximate conversion rate of 2.2402
shares of Common Stock per Depositary Share). Series BB preferred shares are
convertible at the option of the holder until October 1, 1998, at which time
each share will automatically convert to a number of shares of Common Stock
determined by an exchange rate which will vary based on the market price of the
Common Stock at that time, and which will range from 1.6393 to 2.0 shares of
Common Stock per Depositary Share. The conversion rights with respect to the
outstanding Preferred Stock are subject to proportionate adjustment if Alco
combines or splits the outstanding shares of Common Stock or pays a dividend in
Common Stock. Shares of Common Stock issuable upon the exercise of outstanding
stock options are similarly subject to proportionate adjustment in such events.
Shares of Preferred Stock which have been converted must be retired and may not
be reissued.
LIQUIDATION RIGHTS
Common Stock. The holders of Common Stock are entitled pro rata to the assets
of Alco in the event of voluntary or involuntary liquidation, subject to the
rights of creditors and the rights of the holders of the Preferred Stock to
receive certain per share amounts plus accrued unpaid dividends.
Preferred Stock. In the event of voluntary or involuntary liquidation, the
holders of the outstanding Preferred Stock are entitled to receive the
following per share amounts plus accrued and unpaid dividends: Series AA,
$5,000.00 ($50.00 per Depositary Share); and Series BB, $7,737.50 ($77.375 per
Depositary Share). At September 30, 1995, the preference upon liquidation of
the shares of Preferred Stock of Series AA and Series BB aggregated
$501,248,000. After provision for the liquidation preference of Preferred Stock
at September 30, 1995, the portion of shareholders' equity applicable to Common
Stock was $1,367,000,000. In the opinion of counsel for Alco, there are no
restrictions upon the payment of dividends or other distributions out of
surplus solely by reason of the excess of the liquidation preference over the
carrying value of the Preferred Stock, and there are no remedies available to
security holders before or after the payment of any dividend or distribution
solely because such dividend may reduce surplus to an amount less than the
amount of such excess. The Preferred Stock has priority over the Common Stock
on any liquidation, dissolution or winding up to the extent of the liquidation
price plus any accrued and unpaid dividends. The directors have authority in
establishing any series to determine the liquidation price for each series in
the event of any liquidation, dissolution or winding up.
DESCRIPTION OF DEPOSITARY SHARES
The description set forth below and in any Prospectus Supplement of certain
provisions of the Deposit Agreement and of the Depositary Shares and Depositary
Receipts (as those terms are defined below) does not purport to be complete and
is subject to, and qualified in its entirety by reference to, the form of
Deposit Agreement and form of Depositary Receipts which are filed as an exhibit
to the Registration Statement of which this Prospectus is a part.
GENERAL
The Company may, at its option, elect to offer fractional shares, rather than
full shares, of any series of Preferred Stock. Each such fractional share of
Preferred Stock will be represented by a depositary share (collectively, the
"Depositary Shares") pursuant to the terms of a Deposit Agreement (the "Deposit
Agreement") among the Company, a bank or trust company selected by the Company
(the "Depositary")
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and all holders from time to time of depositary receipts issued thereunder (the
"Depositary Receipts"). The Depositary Shares will be evidenced by Depositary
Receipts. Subject to the terms of the Deposit Agreement, each owner of a
Depositary Share will be entitled, proportionately, to all the rights,
preferences and privileges of the fractional share of Preferred Stock
represented thereby (including dividend, voting and liquidation rights), and
subject to all of the limitations of the fractional share of Preferred Stock
represented thereby, which are either summarized above under "Description of
Capital Stock" or set forth in the Prospectus Supplement relating to such
series of Preferred Stock.
ISSUANCE OF DEPOSITARY RECEIPTS AND WITHDRAWAL OF PREFERRED STOCK FROM DEPOSIT
Immediately following the issuance by the Company of the shares of any series
of Preferred Stock to be represented by Depositary Shares, the Company will
deposit such shares of Preferred Stock with the Depositary, which will then
issue and deliver the Depositary Receipts to the Company. The Company will, in
turn, deliver the Depositary Receipts to the purchasers of the Preferred Stock.
Depositary Receipts will be issued evidencing only whole Depositary Shares.
Upon surrender of Depositary Receipts at the Corporate Office (as defined in
the Deposit Agreement) of the Depositary (or such other office as the
Depositary may designate), the owner of the Depositary Shares evidenced thereby
is entitled at such office to certificates evidencing the number of shares of
Preferred Stock (but only in whole shares of Preferred Stock) represented by
such Depositary Receipts. If the Depositary Receipts delivered by the holder
evidence a number of Depositary Shares in excess of the number of whole shares
of Preferred Stock to be withdrawn, the Depositary will deliver to such holder
at the same time a new Depositary Receipt evidencing such excess number of
Depositary Shares.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all cash dividends or other cash distributions
received in respect of the Preferred Stock to the record holders of Depositary
Shares representing such Preferred Stock in proportion to the numbers of such
Depositary Shares owned by such holders on the relevant record date. In the
event of a distribution other than in cash, the Depositary will distribute
property received by it to the record holders of Depositary Shares entitled
thereto, unless the Depositary determines that it is not feasible to make such
distribution, in which case the Depositary may, with the approval of the
Company, sell such property and distribute the net proceeds from such sale to
such holders.
REDEMPTION OF DEPOSITARY SHARES
If a series of the Preferred Stock underlying the Depositary Shares is
subject to redemption, the Depositary Shares will be redeemed from the proceeds
received by the Depositary resulting from the redemption, in whole or in part,
of such series of the Preferred Stock held by the Depositary. The redemption
price per Depositary Share will be equal to the applicable fraction of the
redemption price per share payable with respect to such series of the Preferred
Stock. If less than all the Depositary Shares are to be redeemed, the
Depositary Shares to be redeemed will be selected by lot or pro rata.
After the date fixed for redemption (which will be the same date as the
redemption date for the Preferred Stock), the Depositary Shares so called for
redemption will no longer be deemed to be outstanding and all rights of the
holders of the Depositary Shares will cease, except the right to receive the
moneys payable upon such redemption and any money or other property to which
the holders of such Depositary Shares were entitled upon such redemption upon
surrender to the Depositary of the Depositary Receipts evidencing such
Depositary Shares.
VOTING
Upon receipt of notice of any meeting at which the holders of the Preferred
Stock are entitled to vote, the Depositary will mail the information contained
in such notice of meeting to the record holders of the
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Depositary Shares relating to such Preferred Stock. Each record holder of such
Depositary Shares on the record date (which will be the same date as the record
date for the Preferred Stock) will be entitled to instruct the Depositary as to
the exercise of the voting rights pertaining to the number of shares of
Preferred Stock underlying such holder's Depositary Shares. The Depositary will
endeavor, insofar as practicable, to vote the number of shares of Preferred
Stock underlying such Depositary Shares in accordance with such instructions,
and the Company will agree to take all action which may be deemed necessary by
the Depositary in order to enable the Depositary to do so. The Depositary will
abstain from voting shares of Preferred Stock to the extent the Depositary does
not receive specific instructions from the holders of Depositary Shares
relating to such shares.
AMENDMENT OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between the Company and the Depositary. However, any amendment which imposes or
increases any fees, taxes, or other changes upon holders of Depositary Receipts
(other than taxes and other governmental charges, fees, and other expenses
payable by such holders as stated under "Charges of Depositary"), or which
otherwise prejudices any substantial existing right of holders of Depositary
Receipts, will not take effect as to outstanding Depositary Receipts until the
expiration of 30 days after notice of such amendment has been mailed to the
record holders of outstanding Depositary Receipts. Every holder of Depositary
Receipts at the time any such amendment becomes effective shall be deemed to
consent and agree to such amendment and to be bound by the Deposit Agreement.
CHARGES OF DEPOSITARY
The Company will pay all transfer and other taxes and governmental charges
that arise solely from the existence of the depositary arrangements. The
Company will pay the charges of the Depositary in connection with the initial
deposit of the Preferred Stock and any redemption of the Preferred Stock.
Holders of Depositary Shares will pay all other transfer and other taxes and
governmental charges, and, in addition, such other charges as are expressly
provided in the Deposit Agreement to be for their accounts.
MISCELLANEOUS
The Depositary will forward to the holders of Depositary Shares all reports
and communications from the Company which the Company is required to furnish to
the holders of the Preferred Stock.
Neither the Depositary nor the Company will be liable if it is prevented or
delayed by law or any circumstances beyond its control in performing its
obligations under the Deposit Agreement. The obligations of the Company and the
Depositary under the Deposit Agreement will be limited to performance in good
faith of their duties thereunder and they will not be obligated to prosecute or
defend any legal proceedings in respect of any Depositary Shares or Preferred
Stock unless satisfactory indemnity is furnished. They may rely upon written
advice of counsel or accountants, or information provided by persons presenting
Preferred Stock for deposit, holders of Depositary Shares or other persons
believed to be competent and on documents believed to be genuine.
RESIGNATION AND REMOVAL OF DEPOSITARY; TERMINATION OF THE DEPOSIT AGREEMENT
The Depositary may resign at any time by delivering to the Company notice of
its election to do so, and the Company may at any time remove the Depositary,
any such resignation or removal to take effect upon the appointment of a
successor Depositary and its acceptance of such appointment. Such successor
Depositary will be appointed by the Company within 45 days after delivery of
the notice of resignation or removal. The Deposit Agreement may be terminated
at the direction of the Company or by the Depositary if a period of 45 days
shall have expired after the Depositary has delivered to the Company written
notice of its election to resign and a successor depositary shall not have been
appointed. Upon termination of the Deposit
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Agreement, the Depositary will discontinue the transfer of Depositary Receipts,
will suspend the distribution of dividends to the holders thereof, and will not
give any further notices (other than notice of such termination) or perform any
further acts under the Deposit Agreement except that the Depositary will
continue to collect dividends and other distributions pertaining to the
Preferred Stock, will sell rights, preferences or privileges as provided in the
Deposit Agreement and will continue to deliver Preferred Stock certificates
together with such dividends and distributions and the net proceeds of any
sales of rights, preferences, privileges, or other property in exchange for
Depositary Receipts surrendered. At any time after the expiration of two years
from the date of termination, the Depositary may sell the Preferred Stock and
hold the proceeds of such sale, without interest, for the benefit of the
holders of Receipts who have not then surrendered their Receipts. After making
such sale, the Depositary will be discharged from all obligations under the
Deposit Agreement except to account for such proceeds. In the event the Deposit
Agreement is terminated, the Company will use its best efforts to list the
underlying shares of Preferred Stock on any stock exchange on which such
Depositary Shares were listed.
DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
The Company may issue Stock Purchase Contracts, including contracts
obligating holders to purchase from the Company, and the Company to sell to the
holders, a specified number of shares of Common Stock or Preferred Stock at a
future date or dates. The price per share of Preferred Stock or Common Stock
may be fixed at the time the Stock Purchase Contracts are issued or may be
determined by reference to a specific formula set forth in the Stock Purchase
Contracts. The Stock Purchase Contracts may be issued separately or as a part
of units ("Stock Purchase Units") consisting of a Stock Purchase Contract and
Debt Securities or debt obligations of third parties, including U.S. Treasury
securities, securing the holders' obligations to purchase the Preferred Stock
or the Common Stock under the Purchase Contracts. The Stock Purchase Contracts
may require the Company to make periodic payments to the holders of the Stock
Purchase Units or vice versa, and such payments may be unsecured or prefunded
on some basis. The Stock Purchase Contracts may require holders to secure their
obligations thereunder in a specified manner.
The applicable Prospectus Supplement will describe the terms of any Stock
Purchase Contracts or Stock Purchase Units. The description in the Prospectus
Supplement will not purport to be complete and will be qualified in its
entirety by reference to the Stock Purchase Contracts, and, if applicable,
collateral arrangements and depositary arrangements, relating to such Stock
Purchase Contracts or Stock Purchase Units.
PLAN OF DISTRIBUTION
The Company may sell Securities to or through underwriters, and also may sell
Securities directly to other purchasers or through agents.
The distribution of the 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.
Sales of shares of Common Stock offered hereby may be effected from time to
time in one or more transactions on the NYSE or in negotiated transactions or a
combination of such methods of sale, at market prices prevailing at the time of
sale, at prices related to such prevailing market prices or at other negotiated
prices. In connection with distributions of shares of Common Stock or
otherwise, the Company may enter into hedging transactions with broker-dealers
in connection with which such broker-dealers may sell shares of Common Stock
registered hereunder in the course of hedging through short sales the positions
they assume with the Company.
16
<PAGE>
In connection with the sale of Securities, underwriters or agents may receive
compensation from the Company or from purchasers of Securities for whom they
may act as agents in the form of discounts, concessions or commissions.
Underwriters may sell 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. Any underwriters or agents participating in the distribution of the
Securities may be deemed to be underwriters, and any discounts or commissions
received by them from the Company and any profit on the resale of Securities by
them may be deemed to be underwriting discounts and commissions under the
Securities Act of 1933 (the "Act"). Any such underwriter or agent will be
identified, and any such compensation received from the Company will be
described, in the Prospectus Supplement.
Under agreements which may be entered into by the Company, underwriters and
agents who participate in the distribution of Securities may be entitled to
indemnification by the Company against certain liabilities, including
liabilities under the Act.
If so indicated in the Prospectus Supplement, the Company will authorize
underwriters or other persons acting as the Company's agents to solicit offers
by certain institutions to purchase Securities from the Company pursuant to
contracts providing for payment and delivery on a future date. Institutions
with which such contracts may be made include commercial and savings banks,
insurance companies, pension funds, investment companies, educational and
charitable institutions and others, but in all cases such institutions must be
approved by the Company. The obligations of any purchaser under any such
contract will be subject to the condition that the purchase of such Securities
shall not at the time of delivery by prohibited under the laws of the
jurisdiction to which such purchaser is subject. The underwriters and such
other agents will not have any responsibility in respect of the validity or
performance of such contracts.
Certain of the underwriters or agents and their associates may be customers
of, engage in transactions with and perform services for the Company in the
ordinary course of business.
EXPERTS
The consolidated financial statements of Alco Standard Corporation
incorporated by reference in the Company's Annual Report (Form 10-K) for the
year ended September 30, 1995 have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report thereon included therein and
incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
VALIDITY OF SECURITIES
The validity of the Securities will be passed upon for Alco by its General
Counsel, J. Kenneth Croney, and for any underwriters by Sullivan & Cromwell,
New York, New York. As of October 31, 1995, Mr. Croney beneficially owned
58,714 shares of Common Stock of Alco, including 41,940 shares over which he
has the right to acquire beneficial ownership through the exercise of stock
options granted under Alco's 1981 Stock Option Plan or 1986 Stock Option Plan.
Sullivan & Cromwell from time to time performs legal services for Alco.
17
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION*
<TABLE>
<S> <C>
S.E.C. Filing Fee..................................................... $150,000
Rating Agency Fees.................................................... 61,250
Trustee's Charges..................................................... 5,500
Printing and Engraving................................................ 90,000
Accounting Fees....................................................... 100,000
Stock Exchange Listing Fees........................................... 25,000
Blue Sky Fees and Expenses............................................ 30,000
Miscellaneous......................................................... 20,000
--------
Total............................................................. $481,750
========
</TABLE>
- --------
* All of the amounts, except for the S.E.C. filing fee, have been estimated.
Rating agency fees are estimated for a total of $250 million in debt
securities.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Ohio General Corporation Law provides that a corporation shall indemnify
persons who incur certain liabilities or expenses in the successful defense of
a suit or a proceeding brought by reason of the fact that such persons are or
were directors or officers of the corporation. Pursuant to Ohio law, Alco had
adopted, as part of its Code of Regulations, provisions whereby Alco shall
indemnify such persons against expenses (including attorneys' fees) reasonably
incurred in connection with the successful defense of such actions.
If unsuccessful in defense of a third-party civil suit or a criminal suit, or
if such a suit is settled, such a person shall be indemnified under the Code of
Regulations against both (1) expenses (including attorneys' fees) and (2)
judgments, fines and amounts paid in settlement if he acted in good faith and
in a manner he reasonably believed to be in, or not opposed to, the best
interests of Alco, and with respect to any criminal action, had no reasonable
cause to believe his conduct was unlawful.
If unsuccessful in defense of a suit brought by or in the right of Alco, or
if such suit is settled, such a person shall be indemnified under such law only
against expenses (including attorneys' fees) incurred in the defense or
settlement of such suit if he acted in good faith and in a manner he reasonably
believed to be in, or not opposed to, the best interests of Alco except that if
such a person is adjudged to be liable in such a suit for negligence or
misconduct in the performance of his duty to Alco, he cannot be indemnified
unless specific court approval is obtained.
Alco has purchased liability insurance policies covering its directors and
officers to provide protection where Alco cannot legally indemnify a director
or officer and where a claim arises under the Employee Retirement Income
Security Act of 1974 against a director or officer based upon an alleged breach
of fiduciary duty or other wrongful act.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
------- -----------------------
<C> <S>
(1) --Form of Underwriting Agreement for Debt (incorporated herein by
reference to Form S-3 of the registrant, Registration Statement No.
33-4829, Exhibit (1))
(1.1) --Form of Underwriting Agreement for Equity (incorporated herein by
reference to Form S-3 of the registrant, Registration Statement No.
33-62460, Exhibit (1.1))
(1.2) --Form of Distribution Agreement
</TABLE>
II-1
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
------- -----------------------
<C> <S>
(4) --Form of Indenture between the registrant and First Fidelity Bank,
N.A., Trustee
(4.1) --Form of Debt Securities (included in the form of Indenture filed as
Exhibit (4) to this Registration Statement)
(4.2) --Form of Certificate for Shares of Common Stock (incorporated herein
by reference to Form S-3 of the registrant, Registration Statement
No. 33-62460, Exhibit (4.2))
(4.3) --Form of Certificate for Shares of Preferred Stock (incorporated
herein by reference to Form S-3 of the registrant, Registration
Statement No. 33-62460, Exhibit (4.3))
(4.4) --Form of Certificate for Depositary Receipts (included in the form of
Deposit Agreement incorporated by reference in Exhibit (4.5) to this
Registration Statement)
(4.5) --Form of Deposit Agreement (incorporated herein by reference to Form
S-3 of the registrant, Registration Statement No. 33-62460, Exhibit
(4.5))
(4.6) --Form of Purchase Contract Agreement (including as Exhibit A thereto
the form of Security Certificate)
(4.7) --Form of Pledge Agreement
(5) --Opinion of J. Kenneth Croney General Counsel of the registrant, as
to the validity of the Securities
(12) --Computation of Ratio of Earnings to Fixed Charges
(12.1) --Computation of Ratio of Earnings to Fixed Charges excluding captive
finance subsidiaries
(12.2) --Computation of Ratio of Earnings to Fixed Charges and Preferred
Stock Dividends
(12.3) --Computation of Ratio of Earnings to Fixed Charges and Preferred
Stock Dividends excluding captive finance subsidiaries
(23) --Consent of Ernst & Young LLP
(23.1) --Consent of J. Kenneth Croney, General Counsel of the registrant
(contained in the opinion filed as Exhibit (5) to this Registration
Statement)
(24) --Powers of Attorney; Certified Resolution re: Powers of Attorney
(25) --Form T-1 Statement of Eligibility under the Trust Indenture Act of
1939 of First Fidelity Bank, N.A., Trustee
</TABLE>
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are bring 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;
(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 amendments 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.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment 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.
(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.
The undersigned hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the
II-2
<PAGE>
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the 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 against the registrant 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 Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, ALCO STANDARD
CORPORATION CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS
ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS
REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO
DULY AUTHORIZED, IN VALLEY FORGE, COMMONWEALTH OF PENNSYLVANIA, ON THE 10TH DAY
OF NOVEMBER, 1995.
Alco Standard Corporation
By /s/ Michael J. Dillon
----------------------------------
MICHAEL J. DILLON
CONTROLLER (PRINCIPAL ACCOUNTING
OFFICER)
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION
STATEMENT ON FORM S-3 HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ John E. Stuart Chairman, Chief November 10, 1995
- ------------------------------------- Executive Officer
(JOHN E. STUART) and Director
(Principal
Executive Officer)
/s/ Kurt E. Dinkelacker Executive Vice November 10, 1995
- ------------------------------------- President and
(KURT E. DINKELACKER) Acting Chief
Financial Officer
(Principal
Financial Officer)
/s/ Michael J. Dillon Vice President and November 10, 1995
- ------------------------------------- Controller
(MICHAEL J. DILLON) (Principal
Accounting Officer)
Ray B. Mundt* Director November 10, 1995
- -------------------------------------
(RAY B. MUNDT)
J. Mahlon Buck, Jr.* Director November 10, 1995
- -------------------------------------
(J. MAHLON BUCK, JR.)
Paul J. Darling, II* Director November 10, 1995
- -------------------------------------
(PAUL J. DARLING, II)
II-4
<PAGE>
SIGNATURE TITLE DATE
--------- ----- ----
William F. Drake, Jr.* Director November 10, 1995
- ------------------------------------
(WILLIAM F. DRAKE, JR.)
James J. Forese* Director November 10, 1995
- ------------------------------------
(JAMES J. FORESE)
Frederick S. Hammer* Director November 10, 1995
- ------------------------------------
(FREDERICK S. HAMMER)
Barbara Barnes Hauptfuhrer* Director November 10, 1995
- ------------------------------------
(BARBARA BARNES HAUPTFUHRER)
Dana G. Mead* Director November 10, 1995
- ------------------------------------
(DANA G. MEAD)
Paul C. O'Neill* Director November 10, 1995
- ------------------------------------
(PAUL C. O'NEILL)
Rogelio G. Sada* Director November 10, 1995
- ------------------------------------
(ROGELIO G. SADA)
James W. Stratton* Director November 10, 1995
- ------------------------------------
(JAMES W. STRATTON)
*By his signature set forth below, Hugh G. Moulton, pursuant to duly executed
Powers of Attorney duly filed with the Securities and Exchange Commission, has
signed this Registration Statement on behalf of the persons whose signatures
are printed above, in the capacities set forth opposite their respective names.
/s/ Hugh G. Moulton
- ------------------------------------
(HUGH G. MOULTON)
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT PAGE
NUMBER DESCRIPTION OF EXHIBIT NUMBER
------- ---------------------- ------
<C> <S> <C>
(1) --Form of Underwriting Agreement for Debt (incorporated
herein by reference to Form S-3 of the registrant,
Registration Statement No. 33-4829, Exhibit (1))
(1.1) --Form of Underwriting Agreement for Equity (incorporated
herein by reference to Form S-3 of the registrant,
Registration Statement No. 33-62460, Exhibit (1.1))
(1.2) --Form of Distribution Agreement
(4) --Form of Indenture between the registrant and First Fidelity
Bank, N.A., Trustee
(4.1) --Form of Debt Securities (included in the form of Indenture
filed as Exhibit (4) to this Registration Statement)
(4.2) --Form of Certificate for Shares of Common Stock
(incorporated herein by reference to Form S-3 of the
registrant, Registration Statement No. 33-62460, Exhibit
(4.2))
(4.3) --Form of Certificate for Shares of Preferred Stock
(incorporated herein by reference to Form S-3 of the
registrant, Registration Statement No. 33-62460, Exhibit
(4.3))
(4.4) --Form of Certificate for Depositary Receipts (included in
the Form of Deposit Agreement incorporated by reference in
Exhibit (4.5) to this Registration Statement)
(4.5) --Form of Deposit Agreement (incorporated herein by reference
to Form S-3 of the registrant, Registration Statement No.
33-62460, Exhibit (4.5))
(4.6) --Form of Purchase Contract Agreement (including as Exhibit A
thereto the form of Security Certificate)
(4.7) --Form of Pledge Agreement
(5) --Opinion of J. Kenneth Croney, General Counsel of the
registrant, as to the validity of the Securities
(12) --Computation of Ratio of Earnings to Fixed Charges
(12.1) --Computation of Ratio of Earnings to Fixed Charges excluding
captive finance subsidiaries
(12.2) --Computation of Ratio of Earnings to Fixed Charges and
Preferred Stock Dividends
(12.3) --Computation of Ratio of Earnings to Fixed Charges and
Preferred Stock Dividends excluding captive finance
subsidiaries
(23) --Consent of Ernst & Young LLP
(23.1) --Consent of J. Kenneth Croney, General Counsel of the
registrant (contained in the opinion filed as Exhibit (5) to
this Registration Statement)
(24) --Powers of Attorney; Certified Resolution re: Power of
Attorney
(25) --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of First Fidelity Bank, N.A., Trustee
</TABLE>
<PAGE>
Exhibit 1.2
U.S. $______________
ALCO STANDARD CORPORATION
MEDIUM-TERM NOTES, SERIES A
DISTRIBUTION AGREEMENT
__________ __, 199_
[Insert Name(s) and Address(es)
of Agent(s)]
Dear Sirs:
Alco Standard Corporation, an Ohio corporation (the "Company"), confirms
its agreement with each of you (individually, an "Agent" and collectively, the
"Agents") with respect to the issuance and sale by the Company of up to an
aggregate of $____________ in gross proceeds of its Medium-Term Notes, Series A
(the "Notes"). The Notes are to be issued from time to time pursuant to an
indenture, dated as of _________ __, 199_ (as it may be supplemented or amended
from time to time, the "Indenture"), between the Company and ________________,
as trustee (the "Trustee").
The Notes shall have the maturity ranges, applicable interest rates or
interest rate formulas, specified currency, issue price, redemption and
repayment provisions and other terms set forth in the Prospectus referred to in
Section 1(a) as it may be amended or supplemented from time to time, including
any supplement providing for the interest rate, maturity and other terms of any
Note (a "Pricing Supplement"). The Notes will be issued, and the terms thereof
established, from time to time, by the Company in accordance with the Indenture
and the Procedures referred to below. This Agreement shall only apply to sales
of the Notes and not to sales of any other securities or evidences of
indebtedness of the Company and only on the specific terms set forth herein.
Subject to the terms and conditions stated herein and to the reservation by
the Company of the right to sell its Notes directly on its own behalf, the
Company hereby (i) appoints each of the Agents as the agent of the Company for
the purpose of soliciting and receiving offers to purchase Notes from the
Company and (ii) agrees that whenever the Company determines to sell Notes
directly to an Agent as principal it will enter into a separate agreement (each
a "Purchase Agreement"). Each such Purchase Agreement, whether oral (and
confirmed in writing, which may be by facsimile transmission) or in writing,
shall be with respect to such information (as applicable) as specified in
Exhibit C hereto, relating to such sale in accordance with Section 2(e) hereof.
<PAGE>
Section 1. Representations and Warranties
The Company represents and warrants to each Agent as of the date hereof, as
of the Closing Date (defined herein) and as of the times referred to in Sections
6(a) and 6(b) hereof (the Closing Date and each such time being hereinafter
sometimes referred to as a "Representation Date"), as follows:
(a) General. A registration statement (No. 33-_____) on Form S-3 with
respect to the Notes has been prepared and filed by the Company in conformity
with the requirements of the Securities Act of 1933, as amended (the "Act"), and
the rules and regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder, and has become effective
under the Act. The Indenture has been qualified under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"). As used in this Agreement (i)
"Registration Statement" means such registration statement when it became
effective under the Act, and as from time to time amended or supplemented
thereafter (if any post-effective amendment to such registration statements have
been filed with the Commission prior to the execution and delivery of this
Agreement, the time the most recent such amendment has been declared effective
by the Commission); (ii) "Basic Prospectus" means the prospectus (including all
documents incorporated therein by reference) included in the Registration
Statement; and (ii) "Prospectus" means the Basic Prospectus (together with all
documents incorporated therein by reference) and any amendments or supplements
thereto (including the applicable Pricing Supplement) relating to the Notes, as
filed with the Commission pursuant to paragraph (b) of Rule 424 of the Rules and
Regulations. The Commission has not issued any order preventing or suspending
the use of the Prospectus. Any reference in this Agreement to amending or
supplementing the Prospectus shall be deemed to include the filing of materials
incorporated by reference in the Prospectus after the Closing Date (defined
herein) and any reference in this Agreement to any amendment or supplement to
the Prospectus shall be deemed to include any such materials incorporated by
reference in the Prospectus after the Closing Date (defined herein).
(b) Registration Statement, Prospectus and Indenture: Contents. The
Registration Statement and each Prospectus conformed, and the Registration
Statement and each Prospectus will conform as of the applicable Representation
Date and at all times during each period during which, in the opinion of counsel
for the Agents, a prospectus relating to the Notes is required to be delivered
under the Act (each a "Marketing Period"), in all respects to the requirements
of the Act, the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), the Trust Indenture Act, and the rules and regulations of the Commission
under such Acts; the Indenture, including any amendments and supplements
thereto, conforms with the requirements of the Trust Indenture Act and the rules
and regulations of the Commission thereunder; and the Registration Statement and
each Prospectus do not, and will not as of the applicable Representation Date
and at all times during each Marketing Period, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading; provided, however,
that the Company makes no representation or warranty as to information contained
in or omitted from the Registration Statement or any Prospectus in reliance upon
and in conformity with written information furnished to the Company by the
Agents specifically for inclusion therein or to any statements in or omissions
from the statement of eligibility and qualification on Form T-1 (the "Form T-1")
of the Trustee under the Trust Indenture Act.
-2-
<PAGE>
(c) No Defaults. The Company is not in violation of its corporate charter
or code of regulations or in default under any agreement, indenture or
instrument, the effect of which violation or default would be material to the
Company; the execution, delivery and performance of this Agreement, the
Indenture, the Notes, and each applicable Purchase Agreement, if any, and
compliance by the Company with the provisions of the Notes and the Indenture
have been duly authorized by all necessary corporate action and will not
conflict with, result in the creation or imposition of any lien, charge or
encumbrance upon any of the assets of the Company pursuant to the terms of, or
constitute a default under, any agreement, indenture or instrument, or result in
a violation of the corporate charter or by-laws of the Company or any order,
rule or regulation of any court or governmental agency having jurisdiction over
the Company or its properties; and except as required by the Act, the Trust
Indenture Act, the Exchange Act and applicable state securities laws, no
consent, authorization or order of, or filing or registration with, any court or
governmental agency is required for the execution, delivery and performance of
the transactions contemplated by this Agreement, the Notes, each applicable
Purchase Agreement, if any, or the Indenture. Except as described in Exhibit E
hereto, the Company has no subsidiaries within the meaning of Rule 405 of the
Rules and Regulations.
(d) Material Changes or Material Transactions. Except as described in the
Registration Statement and each Prospectus, (i) there has not been any material
adverse change in, or any adverse development which materially affects, the
business, properties, condition (financial or other), results of operations or
prospects of the Company, and (ii) there has been no material transaction
entered into by the Company other than those in the ordinary course of business.
(e) Accountants. Ernst & Young LLP, whose report appears in the Company's
Annual Report on Form 10-K which is incorporated by reference in each
Prospectus, are independent public accountants with respect to the Company as
required by the Act and the Rules and Regulations.
(f) Validity of the Indenture and the Notes. (i) The Indenture has been
duly authorized, executed and delivered by the Company and constitutes the valid
and legally binding obligation of the Company, enforceable in accordance with
its terms; (ii) the Notes have been validly authorized for issuance and sale
pursuant to this Agreement and, when the terms of the Notes and of their issue
and sale have been duly established in accordance with the Indenture and this
Agreement so as not to violate any applicable law or agreement or instrument
binding on the Company, and the Notes have been duly executed, authenticated,
delivered and paid for as provided in this Agreement and the Indenture, the
Notes will be validly issued and outstanding, and will constitute valid and
legally binding obligations of the Company entitled to the benefits of the
Indenture and enforceable in accordance with their terms and the terms of the
Indenture; and (iii) the Notes and the Indenture conform to the descriptions
thereof contained in each Prospectus. The validity, enforceability and legally
binding nature of the Indenture and the Notes are subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally, general
equitable principles (regardless of whether such enforceability is considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing.
(g) Due Incorporation and Qualification. The Company has been duly
incorporated, is validly existing and in good standing under the laws of its
jurisdiction of incorporation, is duly qualified to do business and in good
standing as a foreign corporation in each jurisdiction in which its ownership of
properties or the conduct of its businesses requires such qualification
-3-
<PAGE>
(except where the failure to obtain such qualification would not have a material
adverse effect on the Company), and has the power and authority necessary to own
or hold its properties and to conduct the businesses in which it is engaged, as
described in each Prospectus.
(h) Ownership of Property. The Company owns, or has valid rights to use,
all items of real and personal property which are material to the business of
the Company, free and clear of all liens, encumbrances and claims which may
materially interfere with the business, properties, financial condition or
results of operations of the Company.
(i) Legal Proceedings. Except as described in each Prospectus, there is
no material litigation or governmental proceeding pending or, to the knowledge
of the Company, threatened against the Company which might result in any
material adverse change in the condition (financial or other), results of
operations, business, property, or prospects of the Company or which is required
to be disclosed in the Registration Statement.
(j) Financial Statements. The audited financial statements included or
incorporated by reference in each Prospectus present and will present fairly, as
of the applicable Representation Date and at all times during each Marketing
Period, the financial condition, results of operations, changes in shareholder's
equity and cash flows of the entities purported to be shown thereby in
conformity with generally accepted accounting principles, at the dates and for
the periods indicated, and have been, and will be as of the applicable
Representation Date and at all times during each Marketing Period, prepared in
conformity with generally accepted accounting principles applied on a consistent
basis throughout the period or periods involved; and the supporting schedules,
if applicable, included or incorporated by reference in each Prospectus present,
and will present as of the applicable Representation Date and at all times
during each Marketing Period, fairly the information required to be stated
therein. The unaudited financial statements of the Company, if any, and the
related notes, included or incorporated by reference in each Prospectus present
fairly and will present fairly at all times during each period specified in
Section 3(c) hereof the financial position of the Company at the dates and for
the periods indicated in conformity with generally accepted accounting
principles (except for the absence of notes) applied on a consistent basis
throughout the periods shown, subject to normally recurring changes, and
prepared in accordance with the instructions to Form 10-Q.
(k) Documents Incorporated by Reference. The documents incorporated by
reference into any Prospectus have been, and will be as of the applicable
Representation Date and at all times during each Marketing Period, prepared by
the Company in conformity with the applicable requirements of the Act and the
Rules and Regulations and the Exchange Act and the rules and regulations of the
Commission thereunder; and none of such documents contained, or will contain as
of the applicable Representation Date and at all times during each Marketing
Period, an untrue statement of a material fact or omitted, or will omit, to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; and such documents have been, or will be, as
of the applicable Representation Date and at all times during each Marketing
Period, timely filed as required thereby.
(l) Exhibits to Registration Statement. There are no contracts or other
documents which are required to be filed as exhibits to the Registration
Statement by the Act or by the Rules and Regulations, or which were required to
be filed as exhibits to any document incorporated by reference in any Prospectus
by the Exchange Act or the rules and regulations of the Commission thereunder,
which have not been filed as exhibits to the Registration Statement or to such
-4-
<PAGE>
document or incorporated therein by reference as permitted by the Rules and
Regulations or the rules and regulations of the Commission under the Exchange
Act, as the case may be.
(m) Licenses, Approvals and Consents. The Company has all licenses,
approvals and consents for the conduct of its business the failure of which to
have would have a material adverse effect on the business, properties, financial
condition or results of operations of the Company.
(n) Investment Company Act. The Company is not required to register under
the provisions of the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and no action need be taken with respect to or under
the Investment Company Act by reason of the issuance of the Notes by the
Company.
(o) Rating. The Notes have been rated by a "nationally recognized
statistical rating agency" (as that term is defined by the Commission for
purposes of Rule 436(g)(2) under the Act), including one or both of Moody's
Investor Services, Inc. and Standard & Poor's Corporation.
(p) Doing Business with Cuba. The Company confirms as of the date hereof,
and each acceptance by the Company of an offer to purchase Notes will be deemed
to be an affirmation, that the Company is in compliance with all provisions of
Section 1 of Laws of Florida, Chapter 92-198, An Act Relating to Disclosure of
Doing Business with Cuba, and the Company further agrees that if it commences
engaging in business with the government of Cuba or with any person or affiliate
located in Cuba after the date the Registration Statement becomes or has become
effective with the Commission or with the Florida Department of Banking and
Finance (the "Department"), whichever date is later, or if the information
reported in the Prospectus, if any, concerning the Company's business with Cuba
or with any person or affiliate located in Cuba changes in any material way, the
Company will provide the Department notice of such business or change, as
appropriate, in a form acceptable to the Department.
(q) True and Complete Documents. The certificates delivered pursuant to
paragraph (f) of Section 5 hereof and all other documents delivered by the
Company or its representatives in connection with the issuance and sale of the
Notes were on the dates on which they were delivered, or will be on the dates on
which they are to be delivered, true and complete in all material respects.
Section 2. Solicitations as Agent; Purchases as Principal
(a) Appointment. Subject to the terms and conditions stated herein, the
Company hereby appoints each of the Agents as the agent of the Company for the
purpose of soliciting or receiving offers to purchase the Notes from the Company
by others. On the basis of the representations and warranties contained herein,
but subject to the terms and conditions herein set forth, each Agent agrees, as
the agent of the Company, to use its reasonable efforts to solicit offers to
purchase the Notes upon the terms and conditions set forth in the Prospectus.
The Company may offer the Notes for sale from time to time otherwise than
through an Agent. However, so long as this Agreement is in effect the Company
shall not solicit offers to purchase Notes through any agent without (i)
amending this Agreement to appoint such agent as an additional Agent hereunder
on the same terms and conditions as provided herein for the Agents (the consent
of the then current
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Agents shall not be necessary for such purpose) and (ii) delivering 2 days prior
written notice thereof to the Agents. The Company may, however, accept offers to
purchase Notes through an agent other than an Agent, provided that (i) the
Company shall not have solicited such offers, (ii) the Company and such agent
shall have executed an agreement with respect to such purchases having the same
terms and conditions (including, without limitation, commission and discount
rates) as those which would apply to such purchases under this Agreement if such
agent were an Agent (which may be accomplished by incorporating by reference in
such agreement the terms and conditions of this Agreement) and (iii) the Company
shall provide the Agents with a copy of such agreement promptly following the
execution thereof. Each Agent may also purchase Notes from the Company as
principal for purposes of resale, as more fully described in paragraph (e) of
this Section.
(b) Suspension of Solicitation. The Company reserves the right, in its
sole discretion, to suspend solicitation of offers to purchase the Notes
commencing at any time for any period of time or indefinitely. Upon receipt of
at least one business day's prior written notice from the Company, the Agents
will forthwith suspend solicitation of offers to purchase Notes from the Company
until such time as the Company has advised the Agents that such solicitation may
be resumed. For the purpose of the foregoing sentence, "business day" shall mean
any day which is not a Saturday or Sunday and which is not a day on which (i)
banking institutions are generally authorized or obligated by law to close in
The City of New York and (ii) the New York Stock Exchange, Inc. is closed for
trading.
Upon receipt of notice from the Company as contemplated by Section 3(c)
hereof, each Agent shall suspend its solicitation of offers to purchase Notes
until such time as the Company shall have furnished it with an amendment or
supplement to the Registration Statement or the Prospectus, as the case may be,
contemplated by Section 3(c) and shall have advised such Agent that such
solicitation may be resumed.
(c) Agent's Commission. Promptly upon the closing of the sale of any
Notes sold by the Company as a result of a solicitation made by or offer to
purchase received by an Agent, the Company agrees to pay such Agent a
commission, in the form of a discount, in accordance with the schedule set forth
in Exhibit A hereto.
(d) Solicitation of Offers. The Agents are authorized to solicit offers
to purchase the Notes only in denominations as are specified in the Prospectus
at a purchase price as shall be specified by the Company. Each Agent shall
communicate to the Company, orally or in writing, each reasonable offer to
purchase Notes received by it as an Agent. The Company shall have the sole right
to accept offers to purchase the Notes and may reject any such offer in whole or
in part. Each Agent shall have the right, in its discretion reasonably exercised
without advising the Company, to reject any offer to purchase the Notes received
by it, in whole or in part, and any such rejection shall not be deemed a breach
of its agreement contained herein.
No Note which the Company has agreed to sell pursuant to this Agreement
shall be deemed to have been purchased and paid for, or sold by the Company,
until such Note shall have been delivered to the purchaser thereof against
payment by such purchaser.
(e) Purchases as Principal. Each sale of Notes to any Agent as principal,
for resale to one or more investors or to another broker-dealer (acting as
principal for purposes of resale), shall be made in accordance with the terms of
this Agreement and a Purchase Agreement whether
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oral (and confirmed in writing by such Agent to the Company, which may be by
facsimile transmission) or in writing, which will provide for the sale of such
Notes to, and the purchase thereof by, such Agent. A Purchase Agreement may also
specify certain provisions relating to the reoffering of such Notes by such
Agent. The commitment of any Agent to purchase Notes from the Company as
principal shall be deemed to have been made on the basis of the representations
and warranties of the Company herein contained and shall be subject to the terms
and conditions herein set forth. Each Purchase Agreement shall specify the
principal amount and terms of the Notes to be purchased by an Agent, the time
and date (each such time and date being referred to herein as a "Time of
Delivery") and place of delivery of and payment for such Notes and such other
information (as applicable) as is set forth in Exhibit C hereto. The Company
agrees that if any Agent purchases Notes as principal for resale such Agent
shall receive such compensation, in the form of a discount or otherwise, as
shall be indicated in the applicable Purchase Agreement or, if no compensation
is indicated therein a commission in accordance with Exhibit A hereto. Any Agent
may utilize a selling or dealer group in connection with the resale of such
Notes. In addition, any Agent may offer the Notes it has purchased as principal
to other dealers. Any Agent may sell Notes to any dealer at a discount and,
unless otherwise specified in the applicable Pricing Supplement, such discount
allowed to any dealer will not be in excess of the discount to be received by
such Agent from the Company. Such Purchase Agreement shall also specify any
requirements for delivery of opinions of counsel, accountant's letters and
officers' certificates pursuant to Section 5 hereof.
(f) Administrative Procedures. Administrative procedures respecting the
sale of Notes (the "Procedures") are set forth in Exhibit B hereto and may be
amended in writing from time to time by the Agents and the Company. Each Agent
and the Company agree to perform the respective duties and obligations
specifically provided to be performed by each of them herein and in the
Procedures. The Procedures shall apply to all transactions contemplated
hereunder including sales of Notes to any Agent as principal pursuant to a
Purchase Agreement, unless otherwise set forth in such Purchase Agreement.
(g) Delivery of Documents. The documents required to be delivered by
Section 5 hereof shall be delivered at the offices of Sullivan & Cromwell, 125
Broad Street, New York, New York 10004, not later that 10:00 A.M., New York City
time, on the date of this Agreement or at such later time as may be mutually
agreed upon by the Company and the Agents, which in no event shall be later than
the time at which the Agents commence solicitation of offers to purchase Notes
hereunder (the "Closing Date").
Section 3. Covenants of the Company
The Company covenants and agrees:
(a) Delivery of Signed Registration Statement. To furnish promptly to the
Agents and to their counsel a signed copy of the Registration Statement as
originally filed and each amendment or supplement thereto.
(b) Delivery of Other Documents. To deliver promptly to the Agents, and
in such number as they may request, each of the following documents: (i)
conformed copies of the Registration Statement (excluding exhibits other than
the computation of the ratio of earnings to fixed charges, the Indenture, this
Agreement and such other exhibits that the Agents may
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request), (ii) the Basic Prospectus, (iii) each Prospectus and (iv) any
documents incorporated by reference in the Prospectus.
(c) Revisions to Prospectus - Material Changes. If, during any Marketing
Period, any event occurs as a result of which the Prospectus would include an
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein not misleading, or if it is necessary at any time
to amend any Prospectus to comply with the Act, to notify the Agents promptly,
in writing, to suspend solicitation of purchases of the Notes; and if the
Company shall decide to amend or supplement the Registration Statement or any
Prospectus, to promptly advise the Agents by telephone (with confirmation in
writing) and to promptly, in writing, prepare and file with the Commission an
amendment or supplement which will correct such statement or omission or an
amendment which will effect such compliance; provided, however, that if during
the period referred to above any Agent shall own any Notes which it has
purchased from the Company as principal with the intention of reselling them,
the Company shall promptly prepare and timely file with the Commission any
amendment or supplement to the Registration Statement or any Prospectus that
may, in the judgment of the Company or the Agents, be required by the Act or
requested by the Commission.
(d) Commission Filings. To timely file with the Commission during any
Marketing Period, all documents (and any amendments to previously filed
documents) required to be filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act.
(e) Copies of Filings with Commission. Prior to filing with the
Commission during any Marketing Period, (i) any amendment or supplement to the
Registration Statement, (ii) any amendment or supplement to any Prospectus or
(iii) any document incorporated by reference in any of the foregoing or any
amendment of or supplement to any such incorporated document, to furnish a copy
thereof to the Agents.
(f) Notice to Agent of Certain Events. To advise the Agents immediately
(i) when any post-effective amendment to the Registration Statement relating to
or covering the Notes becomes effective, (ii) of any request or proposed request
by the Commission for an amendment or supplement to the Registration Statement,
to any Prospectus, to any document incorporated by reference in any of the
foregoing or for any additional information and the Company will afford the
Agents a reasonable opportunity to comment on any such proposed amendment or
supplement, (iii) of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or any part thereof or any order
directed to any Prospectus or any document incorporated therein by reference or
the initiation or threat of any stop order proceeding or of any challenge to the
accuracy or adequacy of any document incorporated by reference in any
Prospectus, (iv) of receipt by the Company of any notification with respect to
the suspension of the qualification of the Notes for sale in any jurisdiction or
the initiation or threat of any proceeding for that purpose, (v) of any
downgrading in the rating of the Notes or any other debt securities of the
Company, or any proposal to downgrade the rating of the Notes or any other debt
securities of the Company, by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), or any
public announcement that any such organization has under surveillance or review
its rating of any debt securities of the Company (other than an announcement
with positive implications of a possible upgrading, and no implication of a
possible downgrading of such rating) as soon as the Company learns of any such
downgrading, proposal to downgrade or public announcement and (vi) of the
happening of any event which makes untrue any statement of material fact made in
the
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Registration Statement or any Prospectus or which requires the making of a
change in the Registration Statement or any Prospectus in order to make any
material statement therein not misleading.
(g) Stop Orders. If, during any Marketing Period, the Commission shall
issue a stop order suspending the effectiveness of the Registration Statement,
to make every reasonable effort to obtain the lifting of that order at the
earliest possible time.
(h) Earnings Statements. As soon as practicable, but not later than 18
months, after the date of each acceptance by the Company of an offer to purchase
Notes hereunder, to make generally available to its security holders an earnings
statement covering a period of at least 12 months beginning after the later of
(i) the effective date of the Registration Statement, (ii) the effective date of
the most recent post-effective amendment to the Registration Statement to become
effective prior to the date of such acceptance and (iii) the date of the
Company's most recent Annual Report on Form 10-K filed with the Commission prior
to the date of such acceptance which will satisfy the provisions of Section
11(a) of the Act (including, at the option of the Company, Rule 158 of the Rules
and Regulations under the Act).
(i) Copies of Reports, Releases and Financial Statements. So long as any
of the Notes are outstanding, to furnish to the Agents, not later than the time
the Company makes the same available to others, copies of all public reports or
releases and all reports and financial statements furnished by the Company to
any securities exchange on which the Notes are listed pursuant to requirements
of or agreements with such exchange or to the Commission pursuant to the
Exchange Act or any rule or regulation of the Commission thereunder.
(j) Blue Sky Qualifications. To endeavor, in cooperation with the Agents,
to qualify the Notes for offering and sale under the securities laws of such
jurisdictions as the Agents may designate, and to maintain such qualifications
in effect for as long as may be required for the distribution of the Notes; and
to file such statements and reports as may be required by the laws of each
jurisdiction in which the Notes have been qualified as above provided.
(k) Holdback. Between the date of a Purchase Agreement and the date of
delivery of the Notes with respect thereto, the Company will not offer or sell,
or enter into any agreement to sell, any of its debt securities, other than
borrowings under the Company's revolving credit agreements and lines of credit,
the private placement of securities and issuances of its commercial paper.
(l) Pricing Supplement. To prepare, with respect to any Notes to be sold
through or to the Agents pursuant to this Agreement, a Pricing Supplement with
respect to such Notes in a form previously approved by the Agents and to file
such Pricing Supplement timely pursuant to Rule 424 under the Act with the
Commission.
Section 4. Payment of Expenses
The Company will pay:
(i) the costs incident to the authorization, issuance, sale and
delivery of the Notes and any taxes payable in that connection,
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(ii) the costs incident to the preparation, printing and filing
under the Act of the Registration Statement and any amendments and exhibits
thereto,
(iii) the costs incident to the preparation, printing and filing
of any document and any amendments and exhibits thereto required to be
filed by the Company under the Exchange Act,
(iv) the costs of distributing the Registration Statement as
originally filed, and each amendment and post-effective amendment thereof
(including exhibits), the Basic Prospectus, each Prospectus, any supplement
or amendment to any Prospectus and any documents incorporated by reference
in any of the foregoing documents,
(v) the fees and disbursements of the Trustee, any paying agent,
any calculation agent, any exchange agent and any other agents appointed by
the Company, and their respective counsel,
(vi) the costs and fees in connection with the listing of the
Notes on any securities exchange,
(vii) the cost and fees in connection with any filings with the
National Association of Notes Dealers, Inc.,
(viii) the fees and disbursements of counsel to the Company and
counsel to the Agents,
(ix) the fees paid to rating agencies in connection with the
rating of the Notes,
(x) the fees and expenses of qualifying the Notes under the
securities laws of the several jurisdictions as provided in Section 3(j)
hereof and of preparing and printing a Blue Sky Memorandum and a memorandum
concerning the legality of the Notes as an investment (including fees and
expenses of counsel for the Agents in connection therewith),
(xi) all advertising expenses in connection with the offering of
the Notes incurred with the consent of the Company, and
(xii) all other costs and expenses arising out of the
transactions contemplated hereunder and incident to the performance of the
Company's obligations under this Agreement or otherwise in connection with
the activities of the Agents under this Agreement.
Section 5. Conditions of Obligations of Agent
The obligation of the Agents, as agents of the Company, under this
Agreement to solicit offers to purchase the Notes, the obligation of any person
who has agreed to purchase Notes to make payment for and take delivery of Notes,
and the obligation of any Agent to purchase Notes pursuant to any Purchase
Agreement, is subject to the accuracy, on each Representation Date,
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of the representations and warranties of the Company contained herein, to the
accuracy of the statements of the Company's officers made in any certificate
furnished pursuant to the provisions hereof, to the performance by the Company
of its obligations hereunder, and to each of the following additional terms and
conditions:
(a) Registration Statement. The Prospectus as amended or supplemented
(including the Pricing Supplement) with respect to such Notes shall have been
filed with the Commission pursuant to Rule 424(b) under the Act within the
applicable time period prescribed for such filing by the Rules and Regulations
and in accordance with Section 3(l) hereof; no stop order suspending the
effectiveness of the Registration Statement or any part thereof nor any order
directed to any document incorporated by reference in any Prospectus have been
issued and no stop order proceeding shall have been initiated or threatened by
the Commission and no challenge shall have been made to the accuracy or adequacy
of any document incorporated by reference in any Prospectus; any request of the
Commission for inclusion of additional information in the Registration Statement
or any Prospectus or otherwise shall have been complied with; and the Company
shall not have filed with the Commission any amendment or supplement to the
Registration Statement or any Prospectus (or any document incorporated by
reference therein) without the consent of the Agents.
(b) No Suspension of Sale of the Notes. No order suspending the sale of
the Notes in any jurisdiction designated by the Agents pursuant to Section 3(j)
hereof shall have been issued, and no proceeding for that purpose shall have
been initiated or threatened.
(c) No Material Omissions or Untrue Statements. The Agents shall not have
discovered and disclosed to the Company that the Registration Statement or any
Prospectus contains an untrue statement of a fact which, in the opinion of
counsel for the Agents, is material or omits to state a fact which, in the
opinion of such counsel, is material and is required to be stated therein or is
necessary to make the statements therein not misleading.
(d) Legal Matters Satisfactory to Counsel. All corporate proceedings and
other legal matters incident to the authorization, form and validity of this
Agreement, the Notes, the Indenture, the form of the Registration Statement,
each Prospectus (other than financial statements and other financial data) and
all other legal matters relating to this Agreement and the transactions
contemplated hereby shall be satisfactory in all respects to counsel for the
Agents and the Company shall have furnished to such counsel all documents and
information that they may reasonably request to enable them to pass upon such
matters.
(e) Opinion of Company Counsel. At the Closing Date, the Agents shall
have received the opinion, addressed to the Agents and dated the Closing Date,
of J. Kenneth Croney, General Counsel of Alco Standard Corporation, in form and
substance satisfactory to the Agents and counsel, to the effect that:
(i) The Company has been duly incorporated and is validly
existing and in good standing under the laws of its jurisdiction of
incorporation, is duly qualified to do business and in good standing as a
foreign corporation in all jurisdictions in which its ownership of
properties or the conduct of its businesses requires such qualification
(except where the failure to so qualify would not have a material adverse
effect on the Company), and has all power and authority necessary to own
its properties and conduct the businesses in which it is engaged, as
described in the Prospectus;
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(ii) Such counsel has no reason to believe that the Registration
Statement, as of its effective date, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or the
Prospectus contains any untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made not misleading, it being understood that such counsel need express no
opinion as to the financial statements or other financial information
contained or incorporated therein or omitted therefrom, or the Form T-1
that is an exhibit to the Registration Statement;
(iii) Such counsel does not know, after reasonable
investigation, of any litigation or any governmental proceeding pending or
threatened against the Company which would affect the subject matter of
this Agreement or is required to be disclosed in the Prospectus which is
not disclosed and correctly summarized therein;
(iv) No consent, approval, authorization or order of any court
or governmental agency or body is required for the consummation of the
transactions contemplated herein except such as have been obtained under
the Act and such as may be required under the blue sky laws of any
jurisdiction in connection with the sale of the Notes as contemplated by
this Agreement and such other approvals (specified in such opinion) as have
been obtained;
(v) Such counsel does not know, after reasonable investigation,
of any contracts or other documents which are required to be filed as
exhibits to the Registration Statement by the Act or by the Rules and
Regulations, or which are required to be filed by the Exchange Act or the
rules and regulations of the Commission thereunder as exhibits to any
document incorporated by reference in the Prospectus, which have not been
filed as exhibits to the Registration Statement or to such document or
incorporated therein by reference as permitted by the Rules and Regulations
or the rules and regulations of the Commission under the Exchange Act;
(vi) To the best of such counsel's knowledge, the Company is not
in violation of its corporate charter or code of regulations, or in default
(except where such default would not have a material adverse effect upon
the Company) under any agreement, indenture or instrument;
(vii) The execution, delivery and performance of this Agreement
and the Purchase Agreements, if any, and compliance by the Company with the
provisions of the Notes and the Indenture will not conflict with, or result
in the creation or imposition of any lien, charge or encumbrance upon any
of the assets of the Company pursuant to the terms of, or constitute a
default under, any agreement, indenture or instrument known to such
counsel, or result in a violation of the corporate charter or code of
regulations of the Company (as in effect on the date of such opinion) or
any order, rule or regulation (also as in effect on the date of such
opinion) of any court or governmental agency having jurisdiction over the
Company or its properties; and no consent, authorization or order of, or
filing or registration with, any court or governmental agency is required
for the execution, delivery and performance by the Company of this
Agreement, and the Purchase Agreements, if any, except such as may be
required by the Act, the Trust Indenture Act, the Exchange Act or state
securities laws;
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(viii) The Indenture has been duly authorized by the Company,
duly executed and delivered by the Company and the Trustee and duly
qualified under the Trust Indenture Act and is a valid and legally binding
obligation of the Company enforceable in accordance with its terms;
(ix) The Notes are in a form contemplated by the Indenture and
have been duly authorized by all necessary corporate action and, when the
terms of the Notes and of their issue and sale have been duly established
in accordance with the Indenture and this Agreement so as not to violate
any applicable law or agreement or instrument then binding on the Company,
and when the Notes have been duly executed and authenticated as specified
in the Indenture and delivered against payment therefor in accordance with
this Agreement, the Notes will be legal, valid and binding obligations of
the Company enforceable in accordance with their terms, and entitled to the
benefits of the Indenture;
(x) The Notes and the Indenture conform to the statements
concerning each of them in the Registration Statement and the Prospectus;
(xi) The Registration Statement has become effective under the
Act and, to the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose is pending or threatened by the Commission;
(xii) To the knowledge of such counsel, after reasonable
investigation, no order directed to any document incorporated by reference
in the Prospectus has been issued and no challenge has been made to the
accuracy or adequacy of any such document; and they have no reason to
believe that any of such documents, when they became effective or were so
filed, as the case may be, contained, in the case of a registration
statement which became effective under the Act, an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and, in
the case of other documents which were filed under the Act or the Exchange
Act with the Commission, an untrue statement of a material fact or omitted
to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made when such
documents were so filed, not misleading;
(xii) The Registration Statement and the Prospectus (except that
no opinion need be expressed as to the financial statements and other
financial data contained therein or the Form T-1 that is an exhibit
thereto) comply as to form in all material respects with the requirements
of the Act and the Trust Indenture Act and the rules and regulations of the
Commission under said Acts and the documents incorporated by reference in
the Prospectus (except that no opinion need be expressed as to the
financial statements and other financial data contained therein) comply as
to form in all material respects with the applicable requirements of the
Exchange Act and the rules and regulations of the Commission thereunder;
(xiv) The statements made in the Prospectus under the captions
"Description of Debt Securities" and "Description of Notes," insofar as
they purport to summarize the provisions of documents or agreements
specifically referred to therein, fairly present the information called for
with respect thereto by Form S-3;
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(xv) The Company has the corporate power and authority necessary
to execute and deliver this Agreement and to perform its obligations
(including the sale and delivery of the Notes under this Agreement)
thereunder; and this Agreement has been duly authorized, executed and
delivered by the Company;
(xvi) The Company is not required to register under the
provisions of the Investment Company Act, and no action need be taken with
respect to or under the Investment Company Act by reason of the issuance of
the Notes by the Company; and
(xvii) The description contained in the Prospectus under the
heading "Certain United States Federal Income Tax Consequences" while not
purporting to discuss all possible income tax ramifications of the proposed
issuance, is correct in all material respects.
The opinions set forth in paragraphs (viii) and (ix) above are subject to
the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law) and an implied
covenant of good faith and fair dealing.
(f) Officers' Certificate. The Company shall have furnished to the Agents
on the Closing Date a certificate, dated the Closing Date, of its President or a
Vice President and its Treasurer or an Assistant Treasurer stating that:
(i) The representations, warranties and agreements of the
Company in Section 1 hereof are true and correct as of the Closing Date;
the Company has complied with all its agreements contained herein; and the
conditions set forth in Sections 5(a) and 5(b) hereof have been fulfilled;
and
(ii) They have carefully examined the Registration Statement and
the Prospectus and, in their opinion, (A) the Registration Statement, as of
its effective date, did not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, (B) the Prospectus
does not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading, and (C) since the effective date of the
Registration Statement there has not occurred any event required to be set
forth in an amended or supplemented prospectus which has not been so set
forth.
(g) Accountant's Letter. The Company shall have furnished to the Agents
on the Closing Date a letter of Ernst & Young LLP, addressed jointly to the
Company and the Agents and dated the Closing Date, of the type described in the
American Institute of Certified Public Accountants' Statement on Auditing
Standards No. 72, in form and substance reasonably satisfactory to the Agents
confirming that they are independent accountants within the meaning of the Act
and the applicable published Rules and Regulations thereunder and stating in
effect that:
(i) In their opinion, the financial statements examined by them
and incorporated by reference in the prospectus contained in the
Registration Statement
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comply in form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and Regulations;
(ii) They have made a review of any unaudited financial
statements incorporated by reference in the Prospectus in accordance with
standards established by the American Institute of Certified Public
Accountants;
(iii) On the basis of the review referred to in (ii) above and a
reading of the latest available interim financial statements of the
Company, inquiries of officials of the Company who have responsibility for
financial and accounting matters and other specified procedures, nothing
came to their attention that caused them to believe that:
(A) the unaudited financial statements, if any, incorporated
by reference in the Prospectus do not comply in form in all material
respects with the applicable accounting requirements of the Act and
the related published Rules and Regulations or are not in conformity
with generally accepted accounting principles applied on a basis
substantially consistent with that of the audited financial statements
incorporated by reference in the Prospectus;
(B) the unaudited capsule information, if any, included in the
Prospectus does not agree with the amounts set forth in the unaudited
financial statements from which it was derived or was not determined
on a basis substantially consistent with that of the audited financial
statements incorporated by reference in the Prospectus;
(C) at the date of the latest available balance sheet read by
such accountants, or at a subsequent specified date not more than five
days prior to the Closing Date, there was any change in the capital
stock, any increase in short-term indebtedness or long-term debt of
the Company or, at the date of the latest available balance sheet read
by such accountants, there was any decrease in net assets as compared
with amounts shown on the latest balance sheet incorporated by
reference in the Prospectus; or
(D) for the period from the date of the latest income
statement included in the Prospectus to the closing date of the latest
available income statement read by such accountants there were any
decreases, as compared with the corresponding period of the previous
year in revenues, income before income taxes and cumulative effect of
accounting change, or net income, or in the ratio of earnings to fixed
charges;
except in all cases set forth in clauses (C) and (D) above for changes,
increases or decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(iv) They have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information contained
in the Prospectus (in each case to the extent that such dollar amounts,
percentages and other financial information are derived from the general
accounting records of the Company subject to the internal controls of the
Company's accounting system or are derived directly from
-15-
<PAGE>
such records by analysis or computation) with the results obtained from
inquiries, a reading of such general accounting records and other
procedures specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with such
results, except as otherwise specified in such letter.
All financial statements included in material incorporated by reference
into the Prospectus shall be deemed included in the Prospectus for purposes of
this subsection.
(h) The Agents shall have received from Sullivan & Cromwell, counsel to
the Agents, such opinion or opinions, dated the Closing Date, with respect to
the issuance and sale of the Notes, the Indenture, the Registration Statement,
the Prospectus and other related matters as the Agents may reasonably require,
and the Company shall have furnished to such counsel such documents as they may
request for the purpose of enabling them to pass upon such matters.
(i) Additional Conditions. There shall not have occurred: (i) any change
in the capital stock or long-term debt of the Company or any of its Subsidiaries
or any change, or any development involving a prospective change, in or
affecting the general affairs, management, shareholder's equity, business,
properties, condition (financial or other), results of operations or prospects
of the Company which in the opinion of the Agents materially impairs the
investment quality of the Notes; (ii) a suspension or material limitation in
trading in securities generally on the New York Stock Exchange, the American
Stock Exchange or the over-the-counter market or the establishment of minimum
prices on such exchanges or such market by the Commission, by such exchange or
by any other regulatory body or governmental authority having jurisdiction;
(iii) a general moratorium on commercial banking activities declared by Federal,
or New York State authorities; (iv) any downgrading in the rating accorded the
Company's debt securities by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), or any
public announcement that any such organization has under surveillance or review
its rating of any debt securities of the Company (other than an announcement
with positive implications of a possible upgrading, and no implication of a
possible downgrading, of such rating); (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress or any other substantial national calamity or emergency; or (vi) any
material adverse change in the existing financial, political or economic
conditions in the United States, including any effect of international
conditions on the financial markets in the United States, that in the judgment
of the Agents makes it impracticable or inadvisable to proceed with the
solicitation of offers to purchase Notes or the purchase of Notes from the
Company as principal pursuant to the applicable Purchase Agreement, as the case
may be.
(j) Other Information and Documentation. Prior to the Closing Date, the
Company shall have furnished to the Agents such further information,
certificates and documents as the Agents or counsel to the Agents may reasonably
request.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in the form and substance satisfactory to
counsel for the Agents.
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<PAGE>
Section 6. Additional Covenants of the Company
The Company covenants and agrees that:
(a) Acceptance of Offer Affirms Representations and Warranties. Each
acceptance by it of an offer for the purchase of Notes shall be deemed to be an
affirmation that the representations and warranties of the Company contained in
this Agreement and in any certificate theretofore given to the Agents pursuant
hereto are true and correct at the time of such acceptance, and an undertaking
that such representations and warranties will be true and correct at the time of
delivery to the purchaser or his agent of the Notes relating to such acceptance
as though made at and as of each such time (and such representations and
warranties shall relate to the Registration Statement and the Prospectus as
amended or supplemented to each such time).
(b) Subsequent Delivery of Officers' Certificates. The Company agrees
that during each Marketing Period, each time that the Registration Statement or
any Prospectus shall be amended or supplemented (other than by a Pricing
Supplement providing solely for the interest rates or maturities of the Notes or
the principal amount of Notes remaining to be sold or similar changes), each
time the Company sells Notes to an Agent as principal and the applicable
Purchase Agreement specifies the delivery of an officers' certificate under this
Section 6(b) as a condition to the purchase of Notes pursuant to such Purchase
Agreement or the Company files with the Commission any document incorporated by
reference into any Prospectus, the Company shall submit to the Agents a
certificate, (i) as of the date of such amendment, supplement, Time of Delivery
relating to such sale or filing or (ii) if such amendment, supplement or filing
was not filed during a Marketing Period, as of the first day of the next
succeeding Marketing Period, representing that the statements contained in the
certificate referred to in Section 5(f) hereof which was last furnished to the
Agents are true and correct at the time of such amendment, supplement or filing,
as the case may be, as though made at and as of such time (except that such
statements shall be deemed to relate to the Registration Statement and each
Prospectus as amended and supplemented to such time).
(c) Subsequent Delivery of Legal Opinions. The Company agrees that during
each Marketing Period, each time that the Registration Statement or any
Prospectus shall be amended or supplemented (other than by a Pricing Supplement
providing solely for the interest rates or maturities of the Notes or the
principal amount of Notes remaining to be sold or similar changes), each time
the Company sells Notes to an Agent as principal and the applicable Purchase
Agreement specifies the delivery of a legal opinion under this Section 6(c) as a
condition to the purchase of Notes pursuant to such Purchase Agreement or the
Company files with the Commission any document incorporated by reference into
any Prospectus, the Company shall, (i) concurrently with such amendment,
supplement, Time of Delivery relating to such sale or filing or (ii) if such
amendment, supplement or filing was not filed during a Marketing Period, on the
first day of the next succeeding Marketing Period, furnish the Agents and their
counsel with the written opinions of the General Counsel of the Company, each
addressed to the Agents and dated the date of delivery of such opinion, in form
satisfactory to the Agents, of the same effect as the opinions referred to in
Section 5(e) hereof, but modified, as necessary, to relate to the Registration
Statement and each Prospectus as amended or supplemented to the time of delivery
of such opinion; provided, however, that in lieu of such opinion, such counsel
may furnish the Agents with a letter to the effect that the Agents may rely on
such prior opinion to the same extent as though it was dated the date of such
letter authorizing reliance (except that statements in such prior opinion shall
be deemed to relate to the Registration Statement and each
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<PAGE>
Prospectus as amended or supplemented to the time of delivery of such letter
authorizing reliance).
(d) Subsequent Delivery of Accountant's Letters. The Company agrees that
during each Marketing Period, each time that the Registration Statement or any
Prospectus shall be amended or supplemented to include additional financial
information, each time the Company sells Notes to an Agent as principal and the
applicable Purchase Agreement specifies the delivery of a letter under this
Section 6(d) as a condition to the purchase of Notes pursuant to such Purchase
Agreement or the Company files with the Commission any document incorporated by
reference into any Prospectus which contains additional financial information,
the Company shall cause Ernst & Young (or other independent accounts of the
Company acceptable to the Agents) to furnish the Agents, (i) concurrently with
such amendment, supplement, Time of Delivery relating to such sale or filing or
(ii) if such amendment, supplement, or filing was not filed during a Marketing
Period, on the first day of the next succeeding Marketing Period, a letter,
addressed jointly to the Company and the Agents and dated the date of delivery
of such letter, in form and substance reasonably satisfactory to the Agents, of
the same effect as the letter referred to in Section 5(g) hereof but modified to
relate to the Registration Statement and each Prospectus, as amended and
supplemented to the date of such letter, with such changes as may be necessary
to reflect changes in the financial statements and other information derived
from the accounting records of the Company; provided, however, that if the
Registration Statement or any Prospectus is amended or supplemented solely to
include financial information as of and for a fiscal quarter, such accountants
may limit the scope of such letter to the unaudited financial statements
included in such amendment or supplement unless there is contained therein any
other accounting, financial or statistical information that, in the reasonable
judgment of the Agents, should be covered by such letter, in which event such
letter shall also cover such other information.
(e) Opinion on Settlement Date. On any settlement date for the sale of
Notes, the Company shall, if requested by the Agent that solicited or received
the offer to purchase any Notes being delivered on such settlement date, furnish
such Agent with a written opinion of the General Counsel of the Company, dated
such settlement date, in form satisfactory to such Agent, to the effect set
forth in Section 5(e) hereof, but modified, as necessary, to relate to the
Prospectus relating to the Notes to be delivered on such settlement date;
provided, however, that in lieu of such opinion, such counsel may furnish the
Agents with a letter to the effect that the Agents may rely on such prior
opinion to the same extent as though it was dated such settlement date (except
that statements in such prior opinion shall be deemed to relate to the
Registration Statement and such Prospectus as amended or supplemented to the
time of delivery of such letter authorizing reliance).
Section 7. Indemnification and Contribution
(a) Indemnification of Agents. The Company shall indemnify and hold
harmless each Agent and each person, if any, who controls any Agent within the
meaning of the Act from and against any loss, claim, damage or liability, joint
or several, and any action in respect thereof, to which such Agent or
controlling person may become subject, under the Act, the Exchange Act or other
federal or state statutory law or regulation, at common law or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus, or arises out of, or
is based upon, the omission or alleged omission to state therein
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<PAGE>
a material fact required to be stated therein or necessary to make the
statements therein not misleading, and shall reimburse each Agent and
controlling person for any legal and other expenses reasonably incurred by such
Agent or controlling person in investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action; provided, however,
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or action arises out of, or is based upon,
any untrue statement or alleged untrue statement or omission or alleged omission
made in the Form T-1 or made in the Registration Statement or the Prospectus in
reliance upon and in conformity with written information furnished to the
Company by the Agents specifically for inclusion therein; provided further, that
as to any prospectus included in the Registration Statement before it became
effective under the Act (a "Preliminary Prospectus") this indemnity agreement
shall not inure to the benefit of any Agent on account of any loss, claim,
damage, liability or action arising from the sale of Notes to any person by that
Agent if that Agent failed to send or give a copy of the Prospectus, as the same
may be amended or supplemented, to that person within the time required by the
Act, and the untrue statement or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact in such Preliminary
Prospectus was corrected in the Prospectus, unless such failure resulted from
non-compliance by the Company with Section 3(b). The foregoing indemnity
agreement is in addition to any liability which the Company may otherwise have
to any Agent or controlling person.
(b) Indemnification of the Company. Each Agent shall indemnify and hold
harmless the Company, each of its directors, each of its officers who signed the
Registration Statement and any person who controls the Company within the
meaning of the Act from and against any loss, claim, damage or liability, joint
or several, and any action in respect thereof, to which the Company or any such
director, officer or controlling person may become subject, under the Act, the
Exchange Act or federal or state statutory law or regulation, at common law or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus, or
arises out of, or is based upon, the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, but in each case only to the extent that the
untrue statement or alleged untrue statement or omission or alleged omission was
made in reliance upon and in conformity with written information furnished to
the Company by such Agent specifically for inclusion therein, and shall
reimburse the Company or any such director, officer or controlling person for
any legal and other expenses reasonably incurred by such indemnified party in
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action. The foregoing indemnity agreement is in addition to
any liability which any Agent may otherwise have to the Company or any of its
directors, officers or controlling persons.
(c) Notice. Promptly after receipt by an indemnified party under this
Section of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section, notify the indemnifying party in writing
of the claim or the commencement of action; provided, however, that the failure
to notify the indemnifying party shall not relieve it from any liability which
it may have to an indemnified party otherwise than under this Section. If any
such claim or action shall be brought against an indemnified party, and it shall
notify the indemnifying party thereof, the indemnifying party shall be entitled
to participate therein, and, to the extent that it wishes, jointly with any
other similarly notified indemnifying party, to assume the defense thereof with
counsel satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified
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<PAGE>
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this
Section for any legal or other expenses subsequently incurred by the indemnified
party in connection with the defense thereof other than reasonable costs of
investigation; provided, however, that the Agents shall have the right to employ
counsel to represent the Agents who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the Agents against the
Company under this Section if, in the reasonable judgment of the Agents, it is
advisable for the Agents to be represented by separate counsel, and in that
event the fees and expenses of such counsel shall be paid by the Company. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
(d) Contribution. If the indemnification provided for in this Section 7
shall for any reason be unavailable to an indemnified party under Section 7(a)
or 7(b) hereof in respect of any loss, claim, damage or liability, or any action
in respect thereof, referred to therein, then each indemnifying party shall, in
lieu of indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage or
liability, or action in respect thereof, (i) in such proportion as shall be
appropriate to reflect the relative benefits received by the Company on the one
hand and any Agents on the other from the offering of the Notes or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company on
the one hand and any Agents on the other with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and any Agents on the
other with respect to such offering shall be deemed to be in the same proportion
as the total net proceeds from the offering of the Notes (before deducting
expenses) received by the Company bears to the total commissions received by the
such Agent with respect to such offering. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or any Agent, the intent of the parties
and their relative knowledge, access to information and opportunity to correct
or prevent such statement or omission. The Company and the Agents agree that it
would not be just and equitable if contributions pursuant to this Section 7(d)
were to be determined by pro rata allocation (even if the Agents were treated as
one entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a result of the loss, claim, damage
or liability, or action in respect thereof, referred to
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<PAGE>
above in this Section 7(d) shall be deemed to include, for purposes of this
Section 7(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 7(d), no Agent shall be
required to contribute any amount in excess of the amount by which the total
price at which the Notes sold through such Agent and distributed to the public
were offered to the public exceeds the amount of any damages which such Agent
has otherwise paid or become liable to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
Section 8. Status of Each Agent
In soliciting offers to purchase the Notes from the Company pursuant to
this Agreement (other than in respect of any Purchase Agreement), each Agent is
acting individually and not jointly and is acting solely as agent for the
Company and not as principal. Each Agent will make reasonable efforts to assist
the Company in obtaining performance by each purchaser whose offer to purchase
Notes from the Company has been solicited by such Agent and accepted by the
Company but such Agent shall have no liability to the Company in the event any
such purchase is not consummated for any reason. If the Company shall default in
its obligations to deliver Notes to a purchaser whose offer it has accepted, the
Company shall (i) hold the Agents harmless against any loss, claim or damage
arising from or as a result of such default by the Company, and (ii) in
particular, pay to the Agents any commission to which they would be entitled in
connection with such sale.
Section 9. Representations, Warranties and Obligations to Survive Delivery
The respective indemnities, agreements, representations, warranties and
other statements of the Company and the Agents contained in this Agreement, or
made by or on behalf of them, respectively, pursuant to this Agreement, shall
remain operative and in full force and effect, regardless of any investigation
made by or on behalf of any Agent or any person controlling such Agent or by or
on behalf of the Company, and shall survive each delivery of and payment for any
of the Notes.
Section 10. Termination
This Agreement may be terminated for any reason with respect to any party
hereto, at any time, by any party hereto upon the giving of one day's written
notice of such termination to the other parties hereto; provided, however, if
such terminating party is an Agent, such termination shall be effective only
with respect to such terminating party. If, at the time of a termination, an
offer to purchase any of the Notes has been accepted by the Company but the time
of delivery to the purchaser has not occurred, the provisions of this Agreement
shall remain in effect until such Notes are delivered. The provisions of
Sections 2(c), 3(d), 3(h), 3(i), 4, 7, 8 and 9 hereof shall survive any
termination of this Agreement.
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<PAGE>
Section 11. Sales of Notes Denominated in a Foreign Currency and Indexed
Notes
If at any time the Company and any of the Agents shall determine to issue
and sell Notes denominated in a currency or currency unit other than U.S.
Dollars, which other currency may include a composite currency, or with respect
to which an index is used to determine the amounts of payments of principal and
any premium or interest, the Company and any such Agent shall execute and
deliver an Amendment (a "Foreign Currency Amendment" or "Indexed Note
Amendment," as the case may be) in the form attached hereto as Exhibit D. Such
amendment shall establish, as appropriate additions and modifications that shall
apply to the sales, whether offered on an agency or principal basis, of the
Notes covered thereby. The Agents are authorized to solicit offers to purchase
Notes with respect to which an index is used to determine the amounts of
payments of principal and any premium and interest, and the Company shall agree
to any sales of such Notes (whether offered on an agency or principal basis),
only in a minimum aggregate amount of $2,500,000.
Section 12. Notices
Except as otherwise provided herein, all notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Agents shall be directed to them as follows:_________________________________,
Attention: _____________________________, Telephone No.: __________, Telecopy
No.: __________________. Notices to the Company shall be directed to it as
follows: Alco Standard Corporation, 825 Duportail Road, Wayne, PA 19087,
Attention: Kathleen Burns, Telephone No.: (610) 296-8000, Telecopy No.:
(610) 296-8419.
Section 13. Binding Effect; Benefits
This Agreement shall be binding upon each Agent, the Company, and their
respective successors. This Agreement and the terms and provisions hereof are
for the sole benefit of only those persons, except that (a) the representations,
warranties, indemnities and agreements of the Company contained in this
Agreement shall also be deemed to be for the benefit of the person or persons,
if any, who control any Agent within the meaning of Section 15 of the Act, and
(b) the indemnity agreement of the Agents contained in Section 7 hereof shall be
deemed to be for the benefit of directors of the Company, officers of the
Company who have signed the Registration Statement and any person controlling
the Company. Nothing in this Agreement is intended or shall be construed to give
any persons other than the person referred to in this Section, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
Section 14. Governing Law; Counterparts
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York. This Agreement may be executed in counterparts
and the executed counterparts shall together constitute a single instrument.
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Section 15. Paragraph Headings
The paragraph headings used in this Distribution Agreement are for
convenience of reference only, and are not to affect the construction hereof or
be taken into consideration in the interpretation hereof.
If the foregoing correctly sets forth our agreement, please indicate your
acceptance hereof in the space provided for that purpose below.
Very truly yours,
ALCO STANDARD CORPORATION
By:
----------------------
Authorized Signatory
CONFIRMED AND ACCEPTED
as of the date first above written:
[INSERT NAME(S) OF AGENT(S)]
By:
--------------------------------
Authorized Signatory
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Exhibit A
ALCO STANDARD CORPORATION
Medium-Term Notes, Series A
SCHEDULE OF PAYMENTS
The Company agrees to pay each Agent a commission equal to the following
percentage of the aggregate U.S. dollar equivalent of the principal amount of
Notes sold by it:
<TABLE>
<CAPTION>
================================================================================
Term Commission Rate
- --------------------------------------------------------------------------------
<S> <C>
9 months to less than 12 months ____%
- --------------------------------------------------------------------------------
12 months to less than 18 months ____%
- --------------------------------------------------------------------------------
18 months to less than 2 years ____%
- --------------------------------------------------------------------------------
2 years to less than 3 years ____%
- --------------------------------------------------------------------------------
3 years to less than 4 years ____%
- --------------------------------------------------------------------------------
4 years to less than 5 years ____%
- --------------------------------------------------------------------------------
5 years to less than 6 years ____%
- --------------------------------------------------------------------------------
6 years to less than 7 years ____%
- --------------------------------------------------------------------------------
7 years to less than 10 years ____%
- --------------------------------------------------------------------------------
10 years to less than 15 years ____%
- --------------------------------------------------------------------------------
15 years to less than 20 years ____%
- --------------------------------------------------------------------------------
20 years to 30 years ____%
- --------------------------------------------------------------------------------
More than 30 years Determined at time of issue
================================================================================
</TABLE>
<PAGE>
Exhibit B
ALCO STANDARD CORPORATION
Medium-Term Notes, Series A
Administrative Procedures
Medium-Term Notes, Series A, with maturities of nine months or more
from date of issue (the "Notes") are to be offered on a continuing basis by Alco
Standard Corporation (the "Company"), [Insert name(s) of Agent(s)], as agents
(each an "Agent" and collectively, the "Agents", have each agreed to use their
reasonable best efforts to solicit offers to purchase the Notes. The Notes are
being sold pursuant to a Distribution Agreement between the Company and the
Agents dated _________ __, 199_ (as it may be supplemented or amended from time
to time, the "Distribution Agreement") to which these administrative procedures
are attached as an exhibit. The Notes will be issued under the Company's
Indenture, dated as of _________ __, 199_ between the Company and
________________, as trustee (the "Trustee"), as heretofore supplemented. The
Notes will rank equally with all other unsecured and unsubordinated indebtedness
of the Company and will have been registered with the Securities and Exchange
Commission (the "Commission"). Terms defined in the Prospectus relating to the
Notes (the "Prospectus," which term shall include any Prospectus Supplement
relating to the Notes and any Pricing Supplement relating to an applicable Note)
and in the Distribution Agreement shall have the same meaning when used in this
exhibit.
The Notes will be issued either (a) in certificated form (each, a
"Certificated Note") delivered to the purchaser thereof or a person designated
by such purchaser or (b) in book-entry form (each, a "Book-Entry Note")
represented by one or more fully registered global Notes (each, a "Global
Security") delivered to the Trustee, as agent for The Depository Trust Company
("DTC"), and recorded in the book-entry system maintained by DTC. Owners of
beneficial interests in Book-Entry Notes will be entitled to physical delivery
of Certificated Notes equal in principal amount to their respective beneficial
interests only in certain limited circumstances described in the Prospectus.
General procedures relating to the issuance of all Notes are set forth
in Part I hereof. Certificated Notes will be issued in accordance with the
procedures set forth in Part II, as supplemented, in the case of Certificated
Notes denominated other than in U.S. dollars ("Multi-Currency Notes"), by Part
III. Book-Entry Notes will be issued in accordance with the procedures set forth
in Part IV.
Administrative responsibilities, document control and record-keeping
functions to be performed by the Company will be performed by its Treasurer.
Administrative procedures for the offering are explained below.
PART I: Procedures of General Applicability
Price to Public
Each Note will be issued at 100% of principal amount, unless otherwise
determined by the Company.
<PAGE>
Date of Issuance
Each Note will be dated and issued as of the date of its authentication
by the Trustee.
Maturities
Each Note will mature on a day at least nine months or more from the
date of issuance selected by the purchaser and agreed upon by the Company. Each
Floating Rate Note (as defined below) will mature on an Interest Payment Date
(as defined below).
Registration
Notes will be issued only in fully registered form as either a Book-
Entry Note or a Certificated Note.
Interest Payments
Each Note bearing interest at a fixed rate (a "Fixed Rate Note") will
bear interest from its issue date at the annual rate stated on the face thereof,
payable in the case of Fixed Rate Notes other than Amortizing Notes, unless
otherwise specified in an applicable Pricing Supplement, on June 15 and December
15 of each year (each an "Interest Payment Date" with respect to such Fixed Rate
Note) and at Stated Maturity or upon redemption, if applicable.
Special provisions are set forth in the Prospectus relating to Notes
bearing interest at a rate or rates determined by reference to an interest rate
formula ("Formula Rate Notes") at a rate determined pursuant to the formula
stated on the face thereof, payable in arrears on such dates as are specified
therein (each an "Interest Payment Date" with respect to such Floating Rate
Note).
Unless otherwise specified in an applicable Pricing Supplement, interest
on Fixed Rate Notes will be calculated and paid on the basis of a 360-day year
of twelve 30-day months. Unless otherwise specified in an applicable Pricing
Supplement, interest will be payable to the person in whose name such Note is
registered at the close of business on May 31 or November 30 (whether or not a
Business Day) with respect to Fixed Rate Notes other than Amortizing Notes (as
hereinafter defined) or the fifteenth day (whether or not a Business Day) next
preceding an Interest Payment Date with respect to Floating Rate Notes (the
"Record Dates"); provided, however, that interest payable at Stated Maturity
will be payable to the person to whom principal shall be payable. Payments of
principal and interest on Notes for which payments of principal and interest are
made in equal installments over the life of the security ("Amortizing Notes")
will be made either quarterly on each March 15, June 15, September 15 and
December 15 or semiannually on each June 15 and December 15 as set forth in the
applicable Pricing Supplement, and at maturity or upon earlier redemption or
repayment. Payments with respect to Amortizing Notes will be applied first to
interest due and payable thereon and then to the reduction of the unpaid
principal amount thereof. A table setting forth repayment information in respect
of each Amortizing Note will be provided to the original purchaser and will be
available, upon request, to subsequent Holders. Any payment of principal and
interest on any such Note required to be paid on an Interest Payment Date or at
Stated Maturity or upon redemption, if applicable, which is not a Business
B-2
<PAGE>
Day shall be postponed to the next day which is a Business Day. The first
payment of interest on any Note originally issued between a Record Date and an
Interest Payment Date will be made on the Interest Payment Date following the
next succeeding Record Date. All interest payments (and, in the case of
Amortizing Notes, principal payments) excluding interest payments and, in the
case of Amortizing Notes, principal payments made at Stated Maturity or upon
redemption, if applicable, will be made by check mailed to the person entitled
thereto as provided above, or, at the option of the Company, by wire transfer to
an account maintained by such person with a bank located in the United States.
Notwithstanding the foregoing, the holder of $10 million or more in aggregate
principal amount of Notes of like tenor and terms with the same Interest Payment
Date may request payment by wire transfers.
On the fifth Business Day immediately preceding each Interest Payment
Date, the Trustee will furnish the Company with the total amount of the interest
payments and, in the case of Amortizing Notes, principal payments, to be made on
such Interest Payment Date. The Trustee (or any duly selected paying agent)
will provide monthly to the Company's Treasury Department a list of the
principal and interest to be paid on Notes maturing in the next succeeding
month. The Company will provide to the Trustee not later than the payment date
sufficient moneys to pay in full all principal and interest payments due on such
payment date. The Trustee will assume responsibility for withholding taxes on
interest paid as required by law.
Acceptance and Rejection of Offers
The Company shall have the sole right to accept offers to purchase
Notes and may reject any such offer in whole or in part. Each Agent shall
promptly communicate to the Company, orally or in writing, each reasonable offer
to purchase Notes from the Company received by it other than those rejected by
such Agent. Each Agent shall have the right, in its discretion reasonably
exercised without advising the Company, to reject any offers in whole or in
part.
Settlement
The receipt of immediately available funds in U.S. dollars by the
Company in payment for a Note (less the applicable commission) and the
authentication and issuance of such Note shall, with respect to such Note,
constitute "Settlement." All offers accepted by the Company will be settled on
the third Business Day next succeeding such date of acceptance, unless the
Company accepts an offer to purchase Notes after 4:30 p.m. on such date in which
case Settlement will occur on the fourth Business Day next succeeding such date
of acceptance, pursuant to the timetable for Settlement set forth below, unless
otherwise agreed to by the Company and the purchaser; provided, however, that
the Company will so notify the Trustee of any such other date on or before the
Business Day immediately prior to the Settlement date.
Procedures for Establishing the Terms of the Notes
The Company and the Agents will discuss from time to time the rates to
be borne by the Notes that may be sold as a result of the solicitation of offers
by the Agents. Once any Agent has recorded any indication of interest in Notes
upon certain terms, and communicated with the Company, if the Company accepts an
offer to purchase Notes upon such terms, it will prepare a Pricing Supplement in
the form
B-3
<PAGE>
previously approved by the Agents, reflecting the terms of such Notes and, after
approval from the Presenting Agent, will arrange to have such Pricing Supplement
(together with the Prospectus, if amended or supplemented) filed with the
Commission and will supply an appropriate number of copies of the Prospectus, as
then amended or supplemented, together with such Pricing Supplement, to the
Presenting Agent. See "Delivery of Prospectus." No settlements with respect to
Notes upon such terms may occur prior to such filing and the Presenting Agent
will not, prior to such filing, mail confirmations to customers who have offered
to purchase Notes upon such terms. After such filing, sales, mailing of
confirmations and settlements may occur with respect to Notes upon such terms,
subject to the provisions of "Delivery of Prospectus" below.
If the Company decides to post rates and a decision has been reached
to change interest rates, the Company will promptly notify each Agent. Each
Agent will forthwith suspend solicitation of purchases. At that time, the Agents
will recommend and the Company will establish rates to be so "posted." Following
establishment of posted rates and prior to the filing described in the following
sentence, the Agents may only record indications of interest in purchasing Notes
at the posted rates. Once any Agent has recorded any indication of interest in
Notes at the posted rates and communicated with the Company, if the Company
accepts an offer at the posted rate, it will prepare a Pricing Supplement
reflecting such posted rates and, after approval from the Presenting Agent, will
arrange to have such Pricing Supplement (together with the Prospectus if amended
or supplemented) filed with the Commission and will supply an appropriate number
of copies of the Prospectus, as then amended or supplemented, to the Presenting
Agent. See "Delivery of Prospectus." No settlements at the posted rates may
occur prior to such filing and the Presenting Agent will not, prior to such
filing, mail confirmations to customers who have offered to purchase Notes at
the posted rates. After such filing, sales, mailing of confirmations and
settlements may resume, subject to the provisions of "Delivery of Prospectus"
below.
Suspension of Solicitation; Amendment or Supplement
In the event that at the time the Agents, at the direction of the
Company, suspend solicitation of offers to purchase from the Company there shall
be any orders outstanding which have not been settled, the Company will promptly
advise the Agents and the Trustee whether such orders may be settled and whether
copies of the Prospectus as theretofore amended and/or supplemented as in effect
at the time of the suspension may be delivered in connection with the settlement
of such orders. The Company will have the sole responsibility for such decision
and for any arrangements which may be made in the event that the Company
determines that such orders may not be settled or that copies of such Prospectus
may not be so delivered.
Delivery of Prospectus
A copy of the Prospectus as most recently amended or supplemented on
the date of delivery thereof, together with the applicable Pricing Supplement,
must be delivered to a purchaser prior to or together with the earlier of the
delivery by the Agents of (i) the written confirmation of a sale sent to a
purchaser or his agent and (ii) any Note purchased by such purchaser. The
Company shall ensure that the Presenting Agent receives copies of the Prospectus
and each amendment or supplement thereto (including the applicable Pricing
Supplement) in such quantities and within such time limits as will enable the
Presenting Agent to deliver such confirmation or Note to a purchaser as
contemplated by these procedures and in compliance with the preceding sentence.
Copies of Pricing Supplements should be
B-4
<PAGE>
delivered by 11:00 A.M. on the Business Day following the applicable trade date
by telecopy to [names and addresses of Agents]. If, since the date of acceptance
of a purchaser's offer, the Prospectus shall have been supplemented solely to
reflect any sale of Notes on terms different from those agreed to between the
Company and such purchaser or a change in posted rates not applicable to such
purchaser, such purchaser shall not receive the Prospectus as supplemented by
such new supplement, but shall receive the Prospectus as supplemented to reflect
the terms of the Notes being purchased by such purchaser and otherwise as most
recently amended or supplemented on the date of delivery of the Prospectus. The
Company will make all such deliveries with respect to all Notes sold directly by
the Company.
Redemption and Repayment
Unless one or more Redemption Dates are specified in the applicable
Pricing Supplement, the Notes will not be redeemable prior to their Stated
Maturity. If one or more Redemption Dates are so specified with respect to any
Note, the applicable Pricing Supplement will also specify one or more redemption
prices (expressed as a percentage of the principal amount of such Note)
("Redemption Prices") and the redemption period or periods ("Redemption
Periods") during which such Redemption Prices shall apply. Unless otherwise
specified in the Pricing Supplement, any such Note shall be redeemable at the
option of the Company at the specified Redemption Price applicable to the
Redemption Period during which such Note is to be redeemed, together with
interest accrued to the Redemption Date. Unless otherwise specified in the
applicable Pricing Supplement, the Notes will not be subject to any sinking
fund. The Company may redeem any of the Notes that are redeemable and remain
outstanding either in whole or from time to time in part, upon not less than 30
nor more than 60 days' notice. In the event of a redemption in part of any Note,
a new Note for the amount of the unredeemed portion shall be issued in the name
of the Holder upon cancellation of the redeemed Note.
The Pricing Supplement relating to each Note will indicate either that
such Note cannot be repaid prior to Stated Maturity or that such Note will be
repayable at the option of the holder on a date or dates specified prior to
Stated Maturity at a price or prices set forth in the applicable Pricing
Supplement, together with accrued interest to the date of repayment.
In order for a Note that is subject to repayment at the option of the
Holder to be repaid, the Paying Agent must receive at least 30 days but not more
than 45 days prior to the repayment date (a) appropriate wire instructions and
(b) either (i) the Note with the form entitled "Option to Elect Repayment"
attached to the Note duly completed or (ii) a telegram, telex, facsimile
transmission or letter from a member of a national securities exchange or the
National Association of Securities Dealers, Inc. or a commercial bank or trust
company in the United States setting forth the name of the Holder of the Note,
the principal amount of the Note, the portion of the principal amount of the
Notes to be repaid, the certificate number or a description of the tenor and
terms of the Note, a statement that the option to elect repayment is being
exercised thereby and a guarantee that the Note to be repaid with the form
entitled "Option to Elect Repayment" attached to the Note duly completed will be
received by the Paying Agent not later than five Business Days after the date of
such telegram, telex, facsimile transmission or letter and such Note and form
duly completed must be received by the Paying Agent by such fifth Business Day.
Exercise of the repayment option by the Holder of a Note shall be irrevocable,
except as otherwise described under "Interest Rate Reset" and "Extension of
Maturity" in the Prospectus Supplement. The repayment option may be exercised by
the Holder of a Note for less than the entire principal amount of the Note
provided that the principal amount of the Note remaining outstanding after
repayment is an authorized denomination. No registration of, transfer or
exchange of any Note (or, in
B-5
<PAGE>
the event that any Note is to be repaid in part, the portion of the Note to be
repaid) will be permitted after exercise of a repayment option. All questions as
to the validity, eligibility (including time of receipt) and acceptance of any
Note for repayment will be determined by the Company, whose determination will
be final, binding and non-appealable.
If a Note is represented by a Global Security, the Depositary's
nominee will be the Holder of such Note and therefore will be the only entity
that can exercise a right to repayment. In order to ensure that the Depositary's
nominee will timely exercise a right to repayment with respect to a particular
Note, the beneficial owner of such Note must instruct the broker or other direct
or indirect participant through which it holds an interest in such Note to
notify the Depositary of its desire to exercise a right to repayment. Different
firms have different cut-off times for accepting instructions from their
customers and, accordingly, each beneficial owner should consult the broker or
other direct or indirect participant through which it holds an interest in a
Note in order to ascertain the cut-off time by which such an instruction must be
given in order for timely notice to be delivered to the Depositary.
Unless otherwise specified in the applicable Pricing Supplement, if a
Note is an Original Issue Discount Note, the amount payable on such Note in the
event of redemption or repayment prior to its Stated Maturity shall be the
Amortized Face Amount of such Note, as specified in the applicable Pricing
Supplement, as of the Redemption Date or the date of repayment, as the case may
be.
Authenticity of Signatures
The Company will cause the Trustee to furnish the Agents from time to
time with the specimen signatures of each of the Trustee's officers, employees
and agents who have been authorized by the Trustee to authenticate Notes, but
the Agents will have no obligation or liability to the Company or the Trustee in
respect of the authenticity of the signature of any officer, employee or agent
of the Company or the Trustee on any Note.
Advertising Costs
The Company will determine with the Agents the amount and nature of
advertising that may be appropriate in offering the Notes. Advertising expenses
incurred with the consent of the Company will be paid by the Company.
Business Day
"Business Day" shall mean, with respect to any particular location,
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions and trust companies in such location are authorized or
required by law, regulation or executive order to close and, with respect to
Notes as to which LIBOR is an applicable Base Rate, is also a London Banking Day
(as defined in the Prospectus).
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<PAGE>
PART II: Procedures For Certificated Notes
Prior to any issuance of Certificated Notes, the Company will deliver
to the Trustee an adequate supply of 4-ply notes meeting the specifications set
forth herein.
Currency
Certificated Notes will be denominated in U.S. dollars or in one or
more foreign currencies or foreign currency units, as specified in the
applicable Pricing Supplement. For special procedures relating to Multi-Currency
Notes, see Part III hereof.
Registration
Certificated Notes may be presented for registration of transfer or
exchange at the Trustee's drop facility in The City of New York.
Denominations
Except as provided in the applicable Pricing Supplement, Certificated
Notes will be issued and payable in U.S. dollars in the denomination of $1,000
and any larger denomination which is an integral multiple of $1,000.
Maturity
Upon presentation of each Certificated Note at Maturity the Trustee
(or any duly appointed Paying Agent) will pay the principal amount thereof,
together with accrued interest due at maturity. Such payment shall be made in
immediately available funds in U.S. dollars, provided that the Certificated Note
is presented to the Trustee (or any such Paying Agent) in time for the Trustee
(or such Paying Agent) to make payments in such funds in accordance with its
normal procedures. The Company will provide the Trustee (and any such Paying
Agent) with funds available for immediate use for such purpose. Certificated
Notes presented at Maturity will be cancelled by the Trustee as provided in the
Indenture.
Settlement Procedures
In the event of a purchase of Certificated Notes by an Agent, as
principal, appropriate Settlement details will be as set forth below unless such
details are set forth in the applicable Purchase Agreement to be entered into
between such Agent and the Company pursuant to the Distribution Agreement.
In the event of the sale of a Certified Note that is a Multi-Currency
Note or an Indexed Note, whether the sale is through an Agent or to an Agent, as
principal, additional or different Settlement details may be set forth in an
amendment to these administrative procedures to be entered into between such
Agent and the Company.
B-7
<PAGE>
Other than as contemplated above, settlement procedures with regard to
each Certificated Note sold through each Agent shall be as follows:
A. Such Agent (the "Presenting Agent") will advise the Company by
telephone, telex or facsimile, of the following Settlement information:
1. Exact name in which the Note is to be registered ("Registered
Owner").
2. Exact address of the Registered Owner and address for payment of
principal and interest, if any.
3. Taxpayer identification number of the Registered Owner.
4. Principal amount of the Note (and, if multiple Notes are to be
issued, denominations thereof).
5. Settlement date.
6. Stated Maturity and, if the Company has the option to extend the
Stated Maturity, the Extension Periods and the Final Maturity
Date.
7. Issue Price and any OID information.
8. Trade Date/Original Issue Date.
9. If such Note is a Fixed Rate Note, whether such Note is an
Amortizing Note.
10. Interest rate (including, if appropriate, such interest rate
information applicable to any Extension Period):
(a) Fixed Rate Certificated Notes:
(i) interest rate
(ii) interest payment dates, if other than as specified above
(iii) date or dates, if any, on which the interest rate may be
reset and the basis or formula, if any, for such resetting
(iv) overdue rate, if any
(b) Floating Rate Certificated Notes:
(i) interest rate basis
(ii) initial interest rate
(iii) spread or spread multiplier, if any
(iv) date or dates, if any, on which the spread or spread
multiplier may be reset and the basis or formula, if any,
for such resetting
(v) interest rate reset periods
(vi) interest payment dates
(vii) index maturity
B-8
<PAGE>
(viii) maximum and minimum interest rates, if any
(ix) record dates
(x) interest determination dates
(xi) overdue rate, if any
11. The date on or after which the Certificated Notes are redeemable at the
option of the Company or are to be repaid at the option of the Holder,
and additional redemption or repurchase provisions, if any.
12. Wire transfer information.
13. Presenting Agent's commission (to be paid in the form of a discount from
the proceeds remitted to the Company upon Settlement).
14. That the Note will be a Certificated Note.
B. The Company will confirm the above Settlement information to the Trustee by
telephone, telex or facsimile, and the Trustee will assign a Note number to the
transaction. If the Company rejects an offer, the Company will promptly notify
the Presenting Agent and the Trustee by telephone.
C. The Trustee will complete the first page of the preprinted 4-ply
Certificated Note packet, the form of which was previously approved by the
Company, the Agents and the Trustee.
D. The Trustee will deliver the Certificated Note (with the attached white
confirmation) and the yellow and blue stubs to the Presenting Agent at one of
the following addresses: [Addresses of Agents]. The Presenting Agent will
acknowledge receipt of the Certificated Note by completing the yellow stub and
returning it to the Trustee.
E. The Presenting Agent will cause to be wire transferred to a bank account
designated by the Company immediately available funds in U.S. dollars in the
amount of the principal amount of the Certificated Note, less the applicable
commission or discount, if any.
F. The Presenting Agent will deliver the Certificated Note (with the white
confirmation) to the purchaser against payment in immediately available funds in
the amount of the principal amount of the Certificated Note. The Presenting
Agent will deliver to the purchaser a copy of the most recent Prospectus
applicable to the Certificated Note with or prior to any written offer of
Certificated Notes, delivery of the Certificated Note and the confirmation and
payment by the purchaser for the Certificated Note.
G. The Presenting Agent will obtain the acknowledgment of receipt for the
Certificated Note and Prospectus by the purchaser through the purchaser's
completion of the blue stub.
H. The Trustee will mail the pink stub to the Company's Treasurer.
B-9
<PAGE>
Settlement Procedures Table
For offers to purchase Certificated Notes accepted by the Company, Settlement
procedures "A" through "H" set forth above shall be completed on or before the
respective times set forth below:
<TABLE>
<CAPTION>
================================================================================
Settlement
Procedure Time (New York)
================================================================================
<S> <C>
A 5 PM on the Trade Date
- --------------------------------------------------------------------------------
B 3 PM on the Business Day prior to Settlement Date
- --------------------------------------------------------------------------------
C-D 12 Noon on the Settlement Date
- --------------------------------------------------------------------------------
E 2:15 PM on the Settlement Date
- --------------------------------------------------------------------------------
F-G 3 PM on the Settlement Date
- --------------------------------------------------------------------------------
H 5 PM on the Business Day after the Settlement Date
================================================================================
</TABLE>
Fails
In the event that a purchaser of a Certificated Note shall either fail to
accept delivery of or make payment for such Certificated Note on the date fixed
by the Company for Settlement, the Presenting Agent will immediately notify the
Trustee and the Company's Treasurer by telephone, confirmed in writing, of such
failure and return the Certificated Note to the Trustee. Upon the Trustee's
receipt of the Certificated Note from the Presenting Agent, the Company will
promptly return to the Presenting Agent an amount of immediately available funds
in U.S. dollars equal to any amount previously transferred to the Company in
respect of the Certificated Note pursuant to advances made by the Agent. Such
returns will be made on the Settlement Date, if possible, and in any event not
later than 12 noon (New York City time) on the Business Day following the
Settlement Date. The Company will reimburse the Presenting Agent on an equitable
basis for its loss of the use of the funds during the period when the funds were
credited to the account of the Company. Upon receipt of the Certificated Note in
respect of which the default occurred, the Trustee will mark the Certificated
Note "cancelled," make appropriate entries in its records and deliver the
Certificated Note to the Company with an appropriate debit advice. The
Presenting Agent will not be entitled to any commission with respect to any
Certificated Note which the purchaser does not accept or make payment for.
PART III: Special Administrative Procedures For
Multi-Currency Notes
Unless otherwise set forth in an applicable Foreign Currency Amendment, the
following procedures and terms shall apply to Multi-Currency Notes in addition
to, and to the extent inconsistent therewith in replacement of, the procedures
and terms set forth above.
B-10
<PAGE>
Denominations
The authorized denominations of any Multi-Currency Note will be the amount of
the Specified Currency for such Multi-Currency Note equivalent, at the noon
buying rate in the City of New York for cable transfers for such Specified
Currency (the "Market Exchange Rate") on the first Business Day in the City of
New York and the country issuing such currency (or, in the case of ECUs,
Brussels) next preceding the date on which the Company accepts the offer to
purchase such Multi-Currency Note, to U.S. $1,000 (rounded down to an integral
multiple of 10,000 units of such Specified Currency) and any greater amount that
is an integral multiple of 10,000 units of such Specified Currency.
Currencies
Unless otherwise specified in the applicable Pricing Supplement, payments of
principal of (and premium, if any) and interest on all Multi-Currency Notes will
be made in the applicable Specified Currency, provided, however, that payments
of principal of (and premium, if any) and interest on Multi-Currency Notes
denominated in other than U.S. dollars will nevertheless be made in U.S. dollars
(i) at the option of the Holders thereof under the procedures described below
and (ii) at the option of the Company in the case of imposition of exchange
controls or other circumstances beyond the control of the Company as described
below.
Payment of Principal and Interest
If so specified in the applicable Pricing Supplement, except as provided in
the next paragraph, payments of interest and principal (and premium, if any)
with respect to any Multi-Currency Note will be made in U.S. dollars if the
Holder of such Note on the relevant Regular Record Date or at Maturity, as the
case may be, has transmitted a written request for such payment in U.S. dollars
to the Trustee at its Corporate Trust Office on or prior to such Regular Record
Date or the date 15 days prior to Maturity, as the case may be. Such request may
be in writing (mailed or hand delivered) or by cable, telex or other form of
facsimile transmission. Any such request made with respect to any Multi-Currency
Note by a Holder will remain in effect with respect to any further payments of
interest and principal (and premium, if any) with respect to such Multi-Currency
Note payable to such Holder, unless such request is revoked on or prior to the
relevant Regular Record Date or the date 15 days prior to Maturity, as the case
may be. Holders of Multi-Currency Notes denominated in other than U.S. dollars
whose Notes are registered in the name of a broker or nominee should contact
such broker or nominee to determine whether and how an election to receive
payments in U.S. dollars may be made.
The U.S. dollar amount to be received by a Holder of a Multi-Currency Note who
elects to receive payments in U.S. dollars will be based on the highest bid
quotation in The City of New York received by the Currency Determination Agent
(as defined below) as of noon New York City time on the third Business Day next
preceding the applicable payment date from three recognized foreign exchange
dealers (one of which may be the Currency Determination Agent) for the purchase
by the quoting dealer of the Specified Currency for U.S. dollars for settlement
on such payment date in the aggregate amount of the Specified Currency payable
to all Holders of Multi-Currency Notes electing to receive U.S. dollar payments
and at which the applicable dealer commits to execute a contract. If three such
bid quotations are not available on the third Business Day preceding the date of
payment of principal (and premium, if any) or interest with respect to any such
Multi-Currency Note, such payment will be made in the
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<PAGE>
Specified Currency. All currency exchange costs associated with any payment in
U.S. dollars on any such Multi-Currency Note will be borne by the Holder thereof
by deductions from such payment. Unless otherwise provided in the applicable
Pricing Supplement, Lehman Brothers Inc. will be the Currency Determination
Agent (the "Currency Determination Agent") with respect to the Multi-Currency
Notes.
Payment Currency
If the principal of (and premium, if any) or interest on any Multi-Currency
Note is payable in any currency other than U.S. dollars and such Specified
Currency is not available due to the imposition of exchange controls or other
circumstances beyond the control of the Company, the Company will be entitled to
satisfy its obligations to Holders of the Multi-Currency Notes by making such
payment in U.S. dollars on the basis of the Market Exchange Rate on the last
date such Specified Currency was available (the "Conversion Date"). Any payment
made under such circumstances in U.S. dollars where the required payment is in
other than U.S.dollars will not constitute an Event of Default under the
Indenture.
If payment in respect of a Note is required to be made in any currency unit
(e.g., ECU) and such currency unit is unavailable due to the imposition of
exchange controls or other circumstances beyond the Company's control, then all
payments in respect of such Multi-Currency Note shall be made in U.S. dollars
until such currency unit is again available. The amount of each payment in U.S.
dollars shall be computed on the basis of the equivalent of the currency unit in
U.S. dollars, which shall be determined by the Company or its agent on the
following basis. The component currencies of the currency unit for this purpose
(the "Component Currencies") shall be the currency amounts that were components
of the currency unit as of the Conversion Date for such currency unit. The
equivalent of the currency unit in U.S. dollars shall be calculated by
aggregating the U.S. dollar equivalents of the Component Currencies. The U.S.
dollar equivalent of each of the Component Currencies shall be determined by the
Company or such agent on the basis of the Market Exchange Rate for each such
Component Currency that is available as of the third Business Day prior to the
date on which the relevant payment is due and for each such Component Currency
that is unavailable, if any, as of the Conversion Date for such Component
Currency.
If the official unit of any Component Currency is altered by way of
combination or subdivision, the number of units of that currency as a Component
Currency shall be divided or multiplied in the same proportion, if two or more
Component Currencies are consolidated into a single currency, the amounts of
those currencies as Component Currencies shall be replaced by an amount in such
single currency equal to the sum of the amounts of the consolidated Component
Currencies expressed in such single currency. If any Component Currency is
divided into two or more currencies, the amount of the original Component
Currency shall be replaced by the amounts of such two or more currencies, the
sum of which shall be equal to the amount of the original Component Currency.
Outstanding Multi-Currency Notes
For purposes of calculating the principal amount of any Multi-Currency Note
for any purpose under the Indenture, the principal amount of such Multi-Currency
Note at any time Outstanding shall be deemed to be the U.S. dollar equivalent at
the Market Exchange Rate, determined as of the date of the original issuance of
such Multi-Currency Note, of the principal amount of such Multi-Currency Note.
B-12
<PAGE>
Details for Settlement of Multi-Currency Notes
In addition to the Settlement information specified in "Settlement Procedures"
above, the Presenting Agent shall communicate to the Company in the manner set
forth in "Settlement Procedures" the following information:
1. Specified Currency
2. Denominations
3. Wire transfer and overseas bank account information (if holder has elected
payment in a Specified Currency).
Whether the sale is through an Agent or to the Agent, as principal, additional
or different Settlement details may be set forth in an amendment to these
administrative procedures to be agreed to by the Agent and the Company.
PART IV: Special Administrative Procedures for Book-Entry Notes
In connection with the qualification of the Book-Entry Notes for eligibility
in the book-entry system maintained by DTC, the Trustee will perform or cause to
be performed the custodial, document control and administrative functions
described below, in accordance with its respective obligations under a Letter of
Representations from the Company and the Trustee to DTC and a Medium-Term Note
Certificate Agreement previously entered into between the Trustee and DTC, and
its obligations as a participant in DTC, including DTC's Same-Day Funds
Settlement System ("SDFS"). Except as otherwise set forth in this Exhibit B,
Book-Entry Notes will be issued in accordance with the administrative procedures
set forth below.
Issuance
On any date of settlement (as defined under "Settlement" below) for one or
more Fixed Rate Book-Entry Notes, the Company will issue a single Global
Security in fully registered form without coupons representing up to
$200,000,000 principal amount, or the equivalent thereof in any Specified
Currency, other than U.S. dollars, at the Market Exchange Rate used to determine
the denomination of such Book-Entry Note as described below (rounded down to an
integral multiple of 10,000 units of such Specified Currency), of all of such
Notes that have the same original issuance date, interest rate, redemption or
repayment provisions and Stated Maturity. Similarly, on any settlement date for
one or more Floating Rate Book-Entry Notes, the Company will issue a single
Global Security representing up to $200,000,000 principal amount, or the
equivalent thereof in any Specified Currency, other than U.S. dollars, at the
Market Exchange Rate used to determine the denomination of such Book-Entry Note
as described below (rounded down to an integral multiple of 10,000 units of such
Specified Currency), of all of such Notes that have the same interest rate
formula, original issuance date, Initial Interest Rate, Interest Payment Dates,
Index Maturity, Spread, Spread Multiplier, minimum interest rate (if any),
maximum interest rate (if any), redemption or repayment provisions and Stated
Maturity. Each Global Security will be dated and issued as of the date of its
authentication by the Trustee. Each Global Security will have an interest
accrual date (the "Interest Accrual Date"), which will be (i) with respect to an
original Global Security (or any portion thereof), its original issuance date
and (ii) with respect to any Global Security (or portion thereof) issued
subsequently upon exchange of a Global Security or in lieu of a destroyed, lost
or stolen
B-13
<PAGE>
Global Security, the most recent Interest Payment Date to which interest has
been paid or duly provided for on the predecessor Global Security or Securities
(or if no such payment or provision has been made, the original issuance date of
the predecessor Global Security), regardless of the date of authentication of
such subsequently issued Global Security. No Global Security will represent (i)
both Fixed Rate and Floating Rate Book-Entry Notes or (ii) any Certificated
Note.
Identification Numbers
The Company will arrange, on or prior to commencement of a program for the
offering of Book-Entry Notes,with the CUSIP Service Bureau of Standard & Poor's
Ratings Group (the "CUSIP Service Bureau") for the reservation of a series of
CUSIP numbers (including tranche numbers), consisting of approximately 900 CUSIP
numbers and relating to Global Securities representing the Book-Entry Notes. The
Company will obtain a written list of such series of reserved CUSIP numbers and
will deliver to the Trustee and DTC such written list of 900 CUSIP numbers of
such series. The Company will assign CUSIP numbers to Global Securities as
described below under Settlement Procedure "B." DTC will notify the CUSIP
Service Bureau periodically of the CUSIP numbers that the Company has assigned
to Global Securities. When fewer than 100 of the reserved CUSIP numbers remain
unassigned to Global Securities, and if it deems necessary, the Company will
reserve additional CUSIP numbers for assignment to Global Securities
representing Book-Entry Notes. Upon obtaining such additional CUSIP numbers the
Company shall deliver such additional CUSIP numbers to the Trustee and DTC.
Registration
Each Global Security will be registered in the name of Cede & Co., as nominee
for DTC, on the Securities Register maintained under the Indenture governing
such Global Security. The beneficial owner of a Book-Entry Note (or one or more
indirect participants in DTC designated by such owner) will designate one or
more participants in DTC with respect to such Book-Entry Note (the
"Participants") to act as agent or agents for such owner in connection with the
book-entry system maintained by DTC, and DTC will record in book-entry form, in
accordance with instructions provided by such Participants, a credit balance
with respect to such Book-Entry Note in the account of such Participants. The
ownership interest of such beneficial owner in such Book-Entry Note will be
recorded through the records of such Participants or through the separate
records of such Participants and one or more indirect participants in DTC.
Voting
In the event of any solicitation of consents from or voting by holders of the
Book-Entry Notes, the Company or the Trustee shall establish a record date for
such purposes (with no provision for revocation of consents or votes by
subsequent holders) and shall, to the extent possible, send notice of such
record date to DTC not less than 15 calendar days in advance of such record
date.
B-14
<PAGE>
Transfers
Transfers of a Book-Entry Note will be accomplished by book entries made by
DTC and, in turn, by Participants (and in certain cases, one or more indirect
participants in DTC ) acting on behalf of beneficial transferors and transferees
of such Book-Entry Note.
Consolidation and Exchange
The Trustee may deliver to DTC and the CUSIP Service Bureau at any time a
written notice of consolidation specifying (i) the CUSIP numbers of two or more
Outstanding Global Securities that represent (A) Fixed Rate Book-Entry Notes
having the same original issuance date, interest rate, redemption and repayment
provisions and Stated Maturity and with respect to which interest has been paid
to the same date or (B) Floating Rate Book-Entry Notes having the same interest
rate formula, original issuance date, Initial Interest Rate, Interest Payment
Dates, Index Maturity, Spread or Spread Multiplier, minimum interest rate (if
any), maximum interest rate (if any), redemption and repayment provisions and
with respect to which interest has been paid to the same date, (ii) a date,
occurring at least thirty days after such written notice is delivered and at
least thirty days before the next Interest Payment Date for such Book-Entry
Notes, on which such Global Securities shall be exchanged for a single
replacement Global Security and (iii) a new CUSIP number, obtained from the
Company, to be assigned to such replacement Global Security. Upon receipt of
such a notice, DTC will send to its Participants (including the Trustee) a
written reorganization notice to the effect that such exchange will occur on
such date. Prior to the specified exchange date, the Trustee will deliver to the
CUSIP Service Bureau a written notice setting forth such exchange date and the
new CUSIP number and stating that, as of such exchange date, the CUSIP numbers
of the Global Securities to be exchanged will no longer be valid. On the
specified exchange date, the Trustee will exchange such Global Securities for a
single Global Security bearing the new CUSIP number and a new Interest Accrual
Date, and the CUSIP numbers of the exchanged Global Securities will, in
accordance with CUSIP Service Bureau procedures, be cancelled and not
immediately reassigned. Notwithstanding the foregoing, if the Global Securities
to be exchanged exceed $200,000,000 (or the equivalent thereof in any Specified
Currency other than U.S. dollars at the Market Exchange Rate used to determine
the denomination of such Book-Entry Note as described below (rounded down to an
integral multiple of 10,000 units of such Specified Currency)) in aggregate
principal amount, one Global Security will be authenticated and issued to
represent each $200,000,000 (or the equivalent thereof in any Specified Currency
other than U.S. dollars at the Market Exchange Rate used to determine the
denomination of such Book-Entry Note as described below (rounded down to an
integral multiple of 10,000 units of such Specified Currency)) of principal
amount of the exchanged Global Securities and an additional Global Security will
be authenticated and issued to represent any remaining principal amount of such
global Securities (see "Denominations" below).
Notice of Redemption and Repayment Dates
The Trustee will give notice to DTC prior to each redemption date or repayment
date (as specified in the Book-Entry Note), if any, at the time and in the
manner set forth in the letter of representation.
B-15
<PAGE>
Denominations
Book-Entry Notes denominated in U.S. dollars will be issued in principal
amounts of $1,000 or any amount in excess thereof that is an integral multiple
of $1,000. The authorized denomination of any Book-Entry Notes denominated in
other than U.S. dollars will be the amount of the Specified Currency for such
Book-Entry Note equivalent, at the Market Exchange Rate on the first Business
Day in the City of New York and the country issuing such currency (or, in the
case of ECUs, Brussels) next preceding the date on which the Company accepts the
offer to purchase such Book-Entry Note, to U.S. $1,000 (rounded down to an
integral multiple of 10,000 units of such Specified Currency) and any greater
amount that is an integral multiple of 10,000 units of such Specified Currency.
Global Securities representing one or more Book-Entry Notes will be denominated
in principal amounts not in excess of $200,000,000, or the equivalent thereof in
any Specified Currency other than U.S. dollars at the Market Exchange Rate used
to determine the denomination of such Book-Entry Note (rounded down to an
integral multiple of 10,000 units of such Specified Currency). If one or more
Book-Entry Notes having an aggregate principal amount in excess of $200,000,000
(or the equivalent thereof in any Specified Currency other than U.S. dollars at
the Market Exchange Rate used to determine the denomination of such Book-Entry
Note down to an integral multiple of 10,000 units of such Specified Currency))
would, but for the preceding sentence, be represented by a single Global
Security, then one Global Security will be issued to represent each $200,000,000
principal amount, or the equivalent thereof in any Specified Currency other than
U.S. dollars at the Market Exchange Rate used to determine the denomination of
such Book-Entry Note (rounded down to an integral multiple of 10,000 units of
such Specified Currency), of such Book-Entry Note or Notes and an additional
Global Security will be issued to represent any remaining principal amount of
such Book-Entry Note or Notes. In such a case, each of the Global Securities
representing such Book-Entry Note or Notes shall be assigned the same CUSIP
number.
Interest
General. Interest on each Book-Entry Note will accrue from the date of issue
of the Global Security representing such Note or from and including the last
date in respect of which interest has been paid or duly provided for. Each
payment of interest on a Book-Entry Note will include interest accrued through
the day preceding, as the case may be, the Interest Payment Date or the date of
Maturity, redemption or repayment; provided, however, that if the Interest Reset
Dates with respect to any such Note are daily or weekly, interest payable on any
Interest Payment Date, other than interest payable on any date on which
principal for such Note is payable, will include interest accrued from the date
of issue of the Global Security, or from and including the last Interest Payment
Date as the case may be, to and including the regular record date immediately
preceding the applicable Interest Payment Date except that at the Stated
Maturity the interest payments will include accrued interest from and including
the date of issue, or from and including the last day in respect of which
interest has been paid or duly provided for, as the case may be, to, but
excluding, the Stated Maturity. Interest payable at the Maturity or upon earlier
redemption or repayment of a Book-Entry Note will be payable to the Person to
whom the principal of such Note is payable. Standard & Poor's Ratings Group will
use the information received in the pending deposit message described under
Settlement Procedure "C" below in order to include the amount of any interest
payable and certain other information regarding the related Global Security in
the appropriate weekly bond report published by Standard & Poor's Ratings Group.
Floating Rate Note Notices. On the first Business Day of January, April, July
and October of each year, the Trustee will deliver to the Company and DTC a
written list of Regular Record Dates and
B-16
<PAGE>
Interest Payment Dates that will occur with respect to Floating Rate Book-Entry
Notes during the six-month period beginning on such first Business Day. Promptly
after each Interest Determination Date (as defined in Appendix A hereto) for
Floating Rate Notes, the Company will notify the Trustee, and the Trustee in
turn will notify Standard & Poor's Ratings Group, of the interest rates
determined on such Interest Determination Date.
Payments of Principal and Interest
Payments of Interest Only. Promptly after each Regular Record Date, the
Trustee will deliver to the Company and DTC a written notice specifying by CUSIP
number the amount of interest to be paid on each Global Security on the
following Interest Payment Date (other than an Interest Payment Date coinciding
with Maturity or an earlier redemption or repayment date) and the total of such
amounts. DTC will confirm the amount payable on each Global Security on such
Interest Payment Date by reference to the daily bond reports published by
Standard & Poor's Ratings Group. The Company will pay to the Trustee, as paying
agent, the total amount of interest due on such Interest Payment Date (other
than at Maturity), and the Trustee will pay such amount to DTC at the times and
in the manner set forth below under "Manner of Payment." Promptly after each
Interest Determination Date for Floating Rate Book-Entry Notes, the Calculation
Agent will notify the Trustee and Standard & Poor's Ratings Group of the
interest rates determined on such Interest Determination Date.
Payments at Maturity or Upon Redemption or Repayment. On or about the first
Business Day of each month, the Trustee will deliver to the Company and DTC a
written list of principal and interest to be paid on each Global Security
maturing either at maturity or any redemption or repayment date in the following
month. The Company, the Trustee and DTC will confirm the amounts of such
principal and interest payments with respect to each such Global Security on or
about the fifth Business Day preceding the Maturity or redemption or repayment
date of such Global Security. The Company will pay to the Trustee, as the paying
agent, the principal amount of such Global Security, together with interest due
at such Maturity or redemption or repayment date, as the case may be. The
Trustee will pay such amount to DTC at the times and in the manner set forth
below under "Manner of Payment."
Promptly after payment to DTC of the principal and interest due at the
Maturity of such Global Security, the Trustee will cancel such Global Security
in accordance with the Indenture and deliver to the Company an appropriate debit
advice. On the first Business Day of each month, the Trustee will prepare a
written statement indicating the total principal amount of Outstanding Global
Securities for which it serves as paying agent as of the immediately preceding
Business Day.
Manner of Payment. The total amount of any principal and interest due on
global Securities on any Interest Payment Date or at Maturity or upon redemption
or repayment shall be paid by the Company to the Trustee in funds available for
use by the Trustee as of 9:30 A.M. (New York City time) on such date. The
Company will make such payment on such Global Securities by instructing the
Trustee to withdraw funds from an account maintained by the Company at the
Trustee. For maturity, redemption or any other principal payments: prior to 10
A.M. (New York City time) on such date or as soon as possible thereafter, the
Trustee will make such payments to DTC in same day funds in accordance with
DTC's Same Day Funds Settlement Paying Agent Operating Procedures. For interest
payments: the Trustee will make such payments to DTC in accordance with existing
arrangements between DTC and the Trustee. DTC will allocate such payments to its
Participants in accordance with its existing operating procedures. Neither the
Company, the Trustee (as Trustee or as Paying Agent nor any other Paying
B-17
<PAGE>
Agent) shall have any direct responsibility or liability for the payment by DTC
to such Participants of the principal of and interest on the Book-Entry Notes.
Withholding Taxes. The amount of any taxes required under applicable law to
be withheld from any interest payment on a Book-Entry Note will be determined
and withheld by the Participant, indirect participant in DTC or other Person
responsible for forwarding payments and materials directly to the beneficial
owner of such Note.
Settlement Procedures
In the event of a purchase of Book-Entry Notes by an Agent, as principal,
Settlement details will be as set forth below unless such details are set forth
in the applicable Purchase Agreement to be entered into between such Agent and
the Company pursuant to the Distribution Agreement.
In the event of a sale of a Book-Entry Note that is a Multi-Currency Note or
an Indexed Note, whether the sale is through an Agent or to an Agent, as
principal, additional or different Settlement details may be set forth in an
amendment to the administrative procedures to be entered into between the such
Agent and the Company.
Other than as contemplated above, settlement procedures with regard to each
Book-Entry Note sold by the Company through an Agent, as agent, shall be as
follows:
A. The Presenting Agent will advise the Company by telephone, telex or
facsimile, of the following settlement information:
1. Principal amount of the Book-Entry Note (and, if multiple Notes are to
be issued, denominations thereof).
2. Settlement date.
3. Stated Maturity and, if the Company has the option to extend the Stated
Maturity, the Extension Periods and the Final Maturity Date.
4. Issue Price and any OID information.
5. Trade date.
6. If such Book-Entry Note is a Fixed Rate Note, whether such Note is an
Amortizing Note.
7. The DTC Participant account number of such Agent.
8. Interest rate (including, if appropriate, such interest rate
information applicable to any Extension Period):
(a) Fixed Rate Notes:
(i) interest rate
B-18
<PAGE>
(ii) interest payment dates, if other than as specified above
(iii) date or dates, if any, on which the interest rate may be reset
and the basis or formula, if any, for such resetting
(iv) overdue rate, if any
(b) Floating Rate Notes:
(i) interest rate basis
(ii) initial interest rate
(iii) spread or spread multiplier, if any
(iv) date or dates, if any, on which the spread or spread multiplier
may be reset and the basis or formula, if any, for such resetting
(v) interest rate reset periods
(vi) interest payment dates
(vii) index maturity
(viii) maximum and minimum interest rates, if any
(ix) record dates
(x) interest determination dates
(xi) overdue rate, if any
9. The date on or after which the Book-Entry Notes are redeemable at the
option of the Company or are to be repaid at the option of the Holder,
and additional redemption or repurchase provisions, if any.
10. Wire transfer information.
11. Presenting Agent's commission (to be paid in the form of a discount from
the proceeds remitted to the Company upon settlement).
12. That the Note will be a Book-Entry Note.
B. The Company will assign a CUSIP number to the Global Security representing
such Note and then advise the Trustee by telephone (confirmed in writing at any
time on the same date) or electronic transmission of the information set forth
in Settlement Procedure "A" above, such CUSIP number and the name of such Agent.
C. The Trustee will enter a pending deposit message through DTC's Participant
Terminal System, providing the following settlement information to DTC, the
Presenting Agent, Standard & Poor's Ratings Group and, upon request, the Trustee
under the Indenture pursuant to which such Note is to be issued:
1. The information set forth in Settlement Procedure "A."
2. Identification as a Fixed Rate Book-Entry Note or a Floating Rate Book-
Entry Note.
3. Initial Interest Payment Date for such Note, number of days by which
such date succeeds the related "DTC Record Date" (which term means the
Regular Record Date except in the case of floating rate notes which
reset daily or weekly in which case it means the date
B-19
<PAGE>
five (5) calendar days immediately preceding the Interest Payment Date)
and amount of interest payable on such Interest Payment Date.
4. Frequency of interest payments (monthly, semiannually, quarterly,
etc.).
5. CUSIP number of the Global Security representing such Book-Entry Note.
6. Whether such Global Security will represent any other Book-Entry Note
(to the extent known at such time).
7. The number of Participant accounts to be maintained by DTC on behalf of
the Agents or the Trustee.
D. The Trustee, as Trustee will complete and authenticate the note certificate
evidencing the Global Security representing such Book-Entry Note.
E. DTC will credit such Book-Entry Note to the Trustee's participant account
at DTC.
F. The Trustee will enter an SDFS deliver order through DTC's Participant
Terminal System instructing DTC to (i) debit such Book-Entry Note to the
Trustee's participant account and credit such Note to the Presenting Agent's
participant account and (ii) debit the Presenting Agent's settlement account and
credit the Trustee's settlement account for an amount equal to the price of such
Book-Entry Note less the Presenting Agent's commission.
G. The Presenting Agent will enter an SDFS deliver order through DTC's
Participant Terminal System instructing DTC (i) to debit such Book-Entry Note to
the Presenting Agent's participant account and credit such Note to the
participant accounts of the Participants with respect to such Book-Entry Note
and (ii) to debit the settlement accounts of such Participants and credit the
settlement account of the Presenting Agent for an amount equal to the price of
such Note.
H. Transfers of funds in accordance with SDFS deliver orders described in
Settlement Procedures "F" and "G" will be settled in accordance with SDFS
operating procedures in effect on the settlement date.
I. The Trustee will credit to an account of the Company maintained at the
Trustee funds available for immediate use in the amount transferred to the
Trustee in accordance with Settlement Procedure "F."
J. The Presenting Agent will deliver to the purchaser a copy of the most
recent Prospectus applicable to the Book-Entry Note with or prior to any written
offer of Book-Entry Notes and the confirmation and payment by the purchaser of
the Book-Entry Note.
The Presenting Agent will confirm the purchase of such Book-Entry Note to the
purchaser either by transmitting to the Participants with respect to such Book-
Entry Note a confirmation order or orders through DTC's institutional delivery
system or by mailing a written confirmation to such purchaser.
B-20
<PAGE>
Settlement Procedures Timetable
For offers to purchase Book-Entry Notes solicited by an Agent, as agent, and
accepted by the Company for settlement, Settlement Procedures "A" through "J"
set forth above shall be completed as soon as possible but not later than the
respective times (New York City time) set forth below:
<TABLE>
<CAPTION>
================================================================================
Settlement
Procedures Time
- --------------------------------------------------------------------------------
<S> <C>
A-B 11:00 A.M. on the Sale date
- --------------------------------------------------------------------------------
C 2:00 P.M. on the Sale date
- --------------------------------------------------------------------------------
D 3:00 P.M. on date before Settlement date
- --------------------------------------------------------------------------------
E 10:00 A.M. on Settlement date
- --------------------------------------------------------------------------------
F-G 2:00 P.M. on Settlement date
- --------------------------------------------------------------------------------
H 4:45 P.M. on Settlement date
- --------------------------------------------------------------------------------
I-J 5:00 P.M. on Settlement date
================================================================================
</TABLE>
If a sale is to be settled more than one (1) Business Day after the sale date,
Settlement Procedures "A," "B" and "C" shall be completed as soon as practicable
but no later than 11:00 A.M., 11:00 A.M. and 2:00 P.M., as the case may be, on
the first Business Day after the sale date. If the initial interest rate for a
Floating Rate Book-Entry Note has not been determined at the time that
Settlement Procedure "A" is completed, Settlement Procedures "B" and "C" shall
be completed as soon as such rate has been determined but not later than 11:00
A.M. and 12:00 Noon, respectively, on the second Business Day before the
settlement date. Settlement Procedure "I" is subject to extension in accordance
with any extension of Fedwire closing deadlines and in the other events
specified in the SDFS operating procedures in effect on the settlement date.
If settlement of a Book-Entry Note is rescheduled or canceled, the Trustee
will deliver to DTC, through DTC's Participant Terminal System, a cancellation
message to such effect by no later than 2:00 P.M. on the Business Day
immediately preceding the scheduled settlement date.
Failure To Settle
If the Trustee fails to enter an SDFS deliver order with respect to a Book-
Entry Note pursuant to Settlement Procedure "F," the Trustee may deliver to DTC,
through DTC's Participant Terminal System, as soon as practicable a withdrawal
message instructing DTC to debit such Book-Entry Note to the Trustee's
participant account. DTC will process the withdrawal message, provided that the
Trustee's participant account contains a principal amount to be debited. If a
withdrawal message is processed with respect to all the Book-Entry Notes
represented by a Global Security, the Trustee will mark such Global Security
"canceled," make appropriate entries in the Trustee's records and send such
canceled Global Security to the Company. The CUSIP number assigned to such
Global Security shall, in accordance with CUSIP Service Bureau procedures, be
canceled and not immediately reassigned. If a withdrawal message
B-21
<PAGE>
is processed with respect to one or more, but not all, of the Book-Entry Notes
represented by a Global Security, the Trustee will exchange such Global Security
for two Global Securities, one of which shall represent such Book-Entry Note or
Notes and shall be canceled immediately after issuance and the other of which
shall represent the other Book-Entry Notes previously represented by the
surrendered Global Security and shall bear the CUSIP number of the surrendered
Global Security.
If the purchase price for any Book-Entry Note is not timely paid to the
Participants with respect to such Book-Entry Note by the beneficial purchaser
thereof (or a Person, including an indirect participant in DTC, acting on behalf
of such purchaser), such Participants and, in turn, the Agent for such Book-
Entry Note may enter SDFS deliver orders through DTC's Participant Terminal
System reversing the orders entered pursuant to Settlement Procedures "F" and
"G," respectively. Thereafter, the Trustee will deliver the withdrawal message
and take the related actions described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure to settle with respect to a
Book-Entry Note, DTC may take any actions in accordance with its SDFS operating
procedures then in effect. In the event of a failure to settle with respect to
one or more, but not all, of the Book-Entry Notes to have been represented by a
Global Security, the Trustee will provide, in accordance with Settlement
Procedure "D," for the authentication and issuance of a Global Security
representing the other Book-Entry Notes to have been represented by such Global
Security and will make appropriate entries in its records.
B-22
<PAGE>
Exhibit C
PURCHASE AGREEMENT
ALCO STANDARD CORPORATION [Date]
825 Duportail Road
Wayne, Pennsylvania 19087-5589
Attention: Treasurer
The undersigned agrees to purchase the following principal amount of the Notes
described in the Distribution Agreement dated __________ __, 199_ (as it may be
supplemented or amended from time to time, the "Distribution Agreement"):
<TABLE>
<S> <C>
Principal Amount: $__________
Specified Currency:
Denominated and Indexed Currencies:
Interest Rate: ____%
Discount: ____% of Principal Amount
Aggregate Price to be Paid to $__________
Company (in immediately available
Funds):
Settlement Date:
Other Terms:
</TABLE>
Terms defined in the Prospectus relating to the Notes and in the Distribution
Agreement shall have the same meaning when used herein.
[In the case of Notes issued in a Specified Currency other than U.S. dollars,
payments of principal of (and premium, if any) and interest on all Notes will be
made in the applicable Specified Currency, provided, however, that payments of
principal of (and premium, if any) and interest on Notes denominated in other
than U.S. dollars will nevertheless be made in U.S. dollars (i) at the option of
the Holders thereof; (ii) at the option of the Company in the case of imposition
of exchange controls or other circumstances beyond the control of the Company as
described below; or (iii) if so specified in the applicable Pricing Supplement.
The U.S. dollar amount to be received by a Holder of a Note denominated in
other than U.S. dollars who elects to receive payments in U.S. dollars will be
based on the highest bid quotation in The City of New York received by the
Currency Determination Agent (as defined below) as of noon New York City time on
the third Business Day next preceding the applicable payment date from three
recognized foreign exchange dealers (one of which may be the Currency
Determination Agent) for the purchase by the quoting dealer of the Specified
Currency for U.S. dollars for settlement on such payment date in the aggregate
amount of the Specified Currency payable to all Holders of Notes electing to
receive U.S. dollar payments and at which the applicable dealer commits to
execute a contract. If three such bid quotations are not available on the third
Business Day preceding the date of payment of principal (and premium, if any) or
interest with respect to any Note, such payment will be made in the Specified
<PAGE>
Currency. All currency exchange costs associated with any payment in U.S.
dollars on any such Note will be borne by the Holder thereof by deductions from
such payment.]
Our obligation to purchase Notes hereunder is subject to the continued
accuracy of your representations and warranties contained in the Distribution
Agreement and to your performance and observance of all applicable covenants and
agreements contained therein, including, without limitation, your obligations
pursuant to Section 7 thereof. Our obligation hereunder is subject to the
further condition that we shall receive (a) the opinions required to be
delivered pursuant to Sections 5(e) and 5(h) of the Distribution Agreement, (b)
the certificate required to be delivered pursuant to Section 5(f) of the
Distribution Agreement, (c) the letter referred to in Section 5(g) of the
Distribution Agreement in each case dated as of the above Settlement Date and
(d) [insert other conditions as appropriate].
In further consideration of our agreement hereunder, you agree that between
the date hereof and the above Settlement Date, you will not offer or sell, or
enter into any agreement to sell, any debt securities of the Company [, other
than borrowings under your revolving credit agreements and lines of credit, the
private placement of securities and issuances of your commercial paper].
We may terminate this Agreement, immediately upon notice to you, at any time
prior to the Settlement Date, if prior thereto there shall have occurred: (i)
any change, or any development involving a prospective change, in or affecting
the general affairs, management, shareholder's equity, business, properties,
condition (financial or other), results of operations or prospects of the
Company which in our opinion materially impairs the investment quality of the
Notes; (ii) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange, the American Stock Exchange or the
over-the-counter market, or the establishment of minimum prices on such
exchanges or such markets; (iii) a general moratorium on commercial banking
activities declared by Federal or New York State authorities; (iv) any
downgrading in the rating accorded the Company's debt securities by any
"nationally recognized statistical rating organization," as that term is defined
by the Commission for purposes of Rule 436(g)(2) under the Act or any public
announcement that any such organization has under surveillance or review its
rating of any debt securities of the Company (other than an announcement with
positive implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress or any other substantial national calamity or emergency; or (vi) any
material adverse change in the existing financial, political or economic
conditions in the United States, including the effect of international
conditions on the financial markets in the United States, or you are unable to
provide any of the opinions, certificates or letters referred to in the second
preceding paragraph. In the event of such termination, no party shall have any
liability to the other party hereto, except as provided in Sections 4, 7 and 13
of the Distribution Agreement.
C-2
<PAGE>
This Agreement shall be governed by and construed in accordance with the laws
of New York.
[Insert Name[s] of Agent[s]]
By:____________________________________
[Title]
Accepted: ,
ALCO STANDARD CORPORATION
By:____________________________________
[Authorized Signatory]
C-3
<PAGE>
Exhibit D
[INDEXED NOTE]
AMENDMENT NO. ___
TO DISTRIBUTION AGREEMENT DATED _________ __, 199_, AS AMENDED
[Insert Title of the Denominated
and Indexed Currencies]
The undersigned hereby agree that for the purposes of the issue and sale of
Notes denominated in [title of currency or currency unit] (the "Denominated
Currency") and indexed to [title of currency or currency unit] (the "Indexed
Currency") pursuant to the Distribution Agreement, dated _________ __, 199_, as
it may be amended (the "Distribution Agreement"), the following additions and
modifications shall be made to the Distribution Agreement. The additions and
modifications adopted hereby shall be of the same effect for the sale under the
Distribution Agreement of all Notes denominated in the Denominated Currency and
indexed to the Indexed Currency, whether offered on an agency or principal
basis, but shall be of no effect with respect to Notes denominated in any
currency or currency unit other than the Applicable Foreign Currency.
Except as otherwise expressly provided herein, all terms used herein which are
defined in the Distribution Agreement shall have the same meanings as in the
Distribution Agreement. The terms Agent or Agents, as used in the Distribution
Agreement, shall be deemed to refer [only] to the undersigned Agents for
purposes of this Amendment.
[Insert appropriate additions and modifications to the Distribution Agreement,
for example, to opinions of counsel, conditions to obligation and settlement
procedures, etc.]
_________________, 19__
Alco Standard Corporation
By:_______________________________________
Name:
Title:
[Name(s) of Agent(s) Participating
In the Offering of the Indexed Notes]
By:_______________________________________
Name:
Title:
<PAGE>
EXHIBIT 4
Draft of November 8, 1995
================================================================================
ALCO STANDARD CORPORATION
TO
FIRST FIDELITY BANK, N.A.
Trustee
---------
Indenture
Dated as of November __, 1995
---------
Senior Debt Securities
================================================================================
<PAGE>
.....................................
Certain Sections of this Indenture relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture Indenture
Act Section Section
- --------------- ---------
<S> <C>
(S) 310(a)(1) .................................... 609
(a)(2) .................................... 609
(a)(3) .................................... Not
Applicable
(a)(4) .................................... Not
Applicable
(b) .................................... 608
610
(S) 311(a) .................................... 613
(b) .................................... 613
(S) 312(a) .................................... 701
702(a)
(b) .................................... 702(b)
(c) .................................... 702(c)
(S) 313(a) .................................... 703(a)
(a)(4) .................................... 101
1004
(b) .................................... 703(a)
(c) .................................... 703(a)
(d) .................................... 703(b)
(S) 314(a) .................................... 704
(b) .................................... Not
Applicable
(c)(1) .................................... 102
(c)(2) .................................... 102
(c)(3) .................................... Not
Applicable
(d) .................................... Not
Applicable
(e) .................................... 102
(S) 315(a) .................................... 601
(b) .................................... 602
(c) .................................... 601
(d) .................................... 601
(e) .................................... 514
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Trust Indenture Indenture
Act Section Section
- --------------- ---------
<S> <C>
(S) 316(a) .................................... 101
(a)(1)(A) .................................... 502
512
(a)(1)(B) .................................... 513
(a)(2) .................................... Not
Applicable
(b) .................................... 508
(c) .................................... 104(c)
(S) 317(a)(1) .................................... 503
(a)(2) .................................... 504
(b) .................................... 1003
(S) 318(a) .................................... 107
</TABLE>
______________
Note: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Indenture.
-ii-
<PAGE>
TABLE OF CONTENTS
Page
----
Parties................................................................
Recitals of the Company................................................
ARTICLE ONE
Definitions and Other Provisions of
General Application
Section 101. Definitions:
Act.......................................................
Affiliate; control........................................
Attributable Debt.........................................
Authenticating Agent......................................
Board of Directors........................................
Board Resolution..........................................
Business Day..............................................
Commission................................................
Company...................................................
Company Request; Company Order............................
Consolidated Net Assets...................................
Corporate Trust Office....................................
corporation...............................................
Defaulted Interest........................................
Depositary................................................
Event of Default..........................................
Exchange Act..............................................
Expiration Date...........................................
Exchange Act..............................................
Expiration Date...........................................
Global Security...........................................
Holder....................................................
Indenture.................................................
interest..................................................
Interest Payment Date.....................................
Maturity..................................................
Notice of Default.........................................
Officers' Certificate.....................................
Opinion of Counsel........................................
Original Issue Discount Security..........................
Outstanding...............................................
Paying Agent..............................................
Person....................................................
Place of Payment..........................................
Note: This table of contents shall not, for any purpose, be deemed to be a part
of the Indenture.
-i-
<PAGE>
Page
Predecessor Security......................................
Principal Property........................................
Redemption Date...........................................
Redemption Price..........................................
Regular Record Date.......................................
Responsible Officer.......................................
Restricted Subsidiary.....................................
Securities................................................
Securities Act............................................
Security Register and Security Registrar..................
Special Record Date.......................................
Stated Maturity...........................................
Subsidiary................................................
Trustee...................................................
Trust Indenture Act.......................................
U.S. Government Obligations...............................
Vice President............................................
Section 102. Compliance Certificates and Opinions......................
Section 103. Form of Documents Delivered to Trustee....................
Section 104. Acts of Holders...........................................
Section 105. Notices, Etc., to Trustee and Company.....................
Section 106. Notice to Holders; Waiver.................................
Section 107. Conflict with Trust Indenture Act.........................
Section 108. Effect of Headings and Table of Contents..................
Section 109. Successors and Assigns....................................
Section 110. Separability Clause.......................................
Section 111. Benefits of Indenture.....................................
Section 112. Governing Law.............................................
Section 113. Legal Holidays............................................
ARTICLE TWO
Security Forms
Section 201. Forms Generally...........................................
Section 202. Form of Face of Security..................................
Section 203. Form of Reverse of Security...............................
Section 204. Form of Legend for Global Securities......................
Section 204. Form of Trustee's Certificate of
Authentication.........................................
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series......................
-ii-
<PAGE>
Page
Section 302. Denominations.............................................
Section 303. Execution, Authentication, Delivery and Dating............
Section 304. Temporary Securities......................................
Section 305. Registration, Registration of Transfer
and Exchange..........................................
Section 306. Mutilated, Destroyed, Lost and Stolen Securities..........
Section 307. Payment of Interest; Interest Rights
Preserved.............................................
Section 308. Persons Deemed Owners.....................................
Section 309. Cancellation..............................................
Section 310. Computation of Interest...................................
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture...................
Section 402. Application of Trust Money................................
ARTICLE FIVE
Remedies
Section 501. Events of Default........................................
Section 502. Acceleration of Maturity; Rescission
and Annulment........................................
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee...............................
Section 504. Trustee May File Proofs of Claim.........................
Section 505. Trustee May Enforce Claims Without Possession of
Securities............................................
Section 506. Application of Money Collected...........................
Section 507. Limitation on Suits......................................
Section 508. Unconditional Right of Holders to
Receive Principal, Premium and
Interest.............................................
Section 509. Restoration of Rights and Remedies.......................
Section 510. Rights and Remedies Cumulative...........................
Section 511. Delay or Omission Not Waiver.............................
Section 512. Control by Holders.......................................
Section 513. Waiver of Past Defaults..................................
Section 514. Undertaking for Costs....................................
Section 515. Waiver of Stay or Extension Laws.........................
-iii-
<PAGE>
Page
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.......................
Section 602. Notice of Defaults........................................
Section 603. Certain Rights of Trustee.................................
Section 604. Not Responsible for Recitals or
Issuance of Securities................................
Section 605. May Hold Securities.......................................
Section 606. Money Held in Trust.......................................
Section 607. Compensation and Reimbursement............................
Section 608. Disqualification; Conflicting Interests
(a) Elimination of Conflicting Interest
of Resignation....................................
(b) Notice of Failure to Eliminate
Conflicting Interest or Resign....................
(c) "Conflicting Interest" Defined........................
(d) Definitions of Certain Terms Used
in This Section..................................
(e) Calculation of Percentages of
Securities
Section 609. Corporate Trustee Required; Eligibility...................
Section 610. Resignation and Removal; Appointment of Successor.........
Section 611. Acceptance of Appointment by Successor....................
Section 612. Merger, Conversion, Consolidation or
Succession to Business................................
Section 613. Preferential Collection of Claims
Against Company.......................................
(a) Segregation and Apportionment of
Certain Collections by Trustee,
Certain Exceptions...............................
(b) Certain Creditor Relationships
Excluded from Segregation and
Apportionment....................................
(c) Definitions of Certain Terms Used
in This Section..................................
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and
Addresses of Holders..................................
Section 702. Preservation of Information;
Communications to Holders.............................
-iv-
<PAGE>
Page
Section 703. Reports by Trustee........................................
Section 704. Reports by Company........................................
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer
or Lease
Section 801. Company May Consolidate, Etc., Only
on Certain Terms......................................
Section 802. Successor Corporation Substituted.........................
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent
of Holders............................................
Section 902. Supplemental Indentures with Consent of
Holders...............................................
Section 903. Execution of Supplemental Indentures......................
Section 904. Effect of Supplemental Indentures.........................
Section 905. Conformity with Trust Indenture Act.......................
Section 906. Reference in Securities to Supplemental
Indentures............................................
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and
Interest
Section 1002. Maintenance of Office or Agency.........................
Section 1003. Money for Securities Payments to Be
Held in Trust.....................................
Section 1004. Corporate Existence.....................................
Section 1005. Maintenance of Properties...............................
Section 1006. Limitation on Liens.....................................
Section 1007. Limitation on Sale and Lease-Back.......................
Section 1008. Exemption from Limitations on Liens
and Sale and Lease-Back...........................
Section 1009. Statement by Officers as to Default.....................
Section 1010. Waiver of Certain Covenants.............................
-v-
<PAGE>
Page
ARTICLE ELEVEN
Redemption of Securities
Section 1001. Applicability of Article................................
Section 1102. Election to Redeem; Notice to
Trustee...........................................
Section 1103. Selection by Trustee of Securities
to Be Redeemed....................................
Section 1104. Notice of Redemption....................................
Section 1105. Deposit of Redemption Price.............................
Section 1106. Securities Payable on Redemption
Date..............................................
Section 1107. Securities Redeemed in Part.............................
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article...............................
Section 1202. Satisfaction of Sinking Fund Payments
with Securities...................................
Section 1203. Redemption of Securities for Sinking
Fund..............................................
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Applicability of Article, Etc..........................
Section 1302. Defeasance and Discharge...............................
Section 1303. Covenant Defeasance....................................
Section 1304. Conditions to Defeasance or Covenant
Defeasance........................................
Section 1305. Deposited Money and U.S. Government
Obligations to Be Held in Trust,
Etc. .............................................
Testimonium............................................................
Signatures and Seals...................................................
Acknowledgements.......................................................
-iv-
<PAGE>
INDENTURE, dated as of November __, 1995, between Alco Standard
Corporation, a corporation duly organized and existing under the laws of the
State of Ohio (herein called the "Company"), having its principal office at P.O.
Box 834, Valley Forge, Pennsylvania 19482, and First Fidelity Bank, N.A., a
national banking association duly organized and existing under the laws of the
United States, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
-----------
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
<PAGE>
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles;
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
Certain terms, used principally in Article Six, are defined in that
Article.
"Act", when used with respect to any Holder, has the meaning specified
in Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Attributable Debt" has the meaning specified in Section 1006.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment, means
each Monday, Tuesday, Wednesday,
-2-
<PAGE>
Thursday and Friday which is not a day on which banking institutions in that
Place of Payment are authorized or obligated by law to close.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, or,
if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor corporation.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman, its President or a Vice President, and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to a
Responsible Officer of the Trustee.
"Consolidated Net Assets" has the meaning specified in Section 1006.
"Corporate Trust Office" means the principal office of the Trustee in
the Borough of Manhattan, The City of New York, at which at any particular time
its corporate trust business shall be administered, which office at the date of
the original execution of this Indenture is located at One New York Plaza, 14th
Floor, New York, New York 10081.
"corporation" includes corporations, associations, companies, joint-
stock companies or business trusts.
"Defaulted Interest" has the meaning specified in Section 307.
"Depositary" means, with respect to Securities of any series issuable
in whole or in part in the form of one or more Global Securities, a clearing
agency registered under the Exchange Act that is designated to act as Depositary
for such Securities as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
-3-
<PAGE>
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 204 (or such
legend as may be specified as contemplated by Section 301 for such Securities).
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.
"interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity.
"Interest Payment Date", when used with respect to any Security, means
the Stated Maturity of an instalment of interest on such Security.
"Investment Company Act" means the Investment Company Act of 1940 and
any statute successor thereto, in each case as amended from time to time.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an instalment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration or acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in
Section 501(4) or 501(5).
-4-
<PAGE>
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Company, and
delivered to the Trustee. One of the officers signing an Officers' Certificate
given pursuant to Section 1004 shall be the principal executive, financial or
accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company.
"Original Issue Discount Security" means any Security which provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the Maturity thereof pursuant to Section 502.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
------
(i) Securities theretofore cancelled by the Trustee or delivered
to the Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (other than the Company) in trust or set aside and segregated
in trust by the Company (if the Company shall act as its own Paying Agent)
for the Holders of such Securities; provided that, if such Securities are
--------
to be redeemed, notice of such redemption has been duly given pursuant to
this Indenture or provision therefor satisfactory to the Trustee has been
made; and
(iii) Securities which have been paid pursuant to Section 306 or
in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than any such
Securities in respect of which there shall have been presented to the
Trustee proof satisfactory to it that such Securities are held by a bona
fide purchaser in whose hands such Securities are valid obligations of the
Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
-5-
<PAGE>
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof to such date pursuant to Section 502, (B)
if, as of such date, the principal amount payable at the Stated Maturity of a
Security is not determinable, the principal amount of such Security which shall
be deemed to be Outstanding shall be the amount as specified or determined as
contemplated by Section 301, (C) the principal amount of a Security denominated
in one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the U.S. dollar equivalent, determined as of such date in
the manner provided as contemplated by Section 301, of the principal amount of
such Security (or, in the case of Security described in Clause (A) or (B) above,
of the amount determined as provided in such Clause), and (D) Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent, waiver or other action, only Securities which the Trustee knows to be
so owned shall be so disregarded. Securities so owned which have been pledged
in good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Securities on behalf of
the Company.
"Person" means any individual, corporation, partnership, joint
venture, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of (and premium, if any)
and interest on the Securities of that series are payable as specified as
contemplated by Section 301.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
-6-
<PAGE>
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Principal Property" has the meaning specified in Section 1006.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of any series means the date specified for that purpose
as contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee, means
the chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
or any assistant controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Subsidiary" has the meaning specified in Section 1006.
"Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Securities authenticated and delivered
under this Indenture.
"Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
-7-
<PAGE>
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
instalment 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
instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting stock" means stock
which ordinarily has voting power for the election of directors, whether at all
times or only so long as no senior class of stock has such voting power by
reason of any contingency.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder, 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.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"U.S. Government Obligations" has the meaning specified in Section
1304.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
Section 102. Compliance Certificates and Opinions.
------------------------------------
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee such
-8-
<PAGE>
certificates and opinions as may be required under the Trust Indenture Act.
Each such certificate or opinion shall be given in the form of an Officers'
Certificate, to be given by an officer of the Company, or an Opinion of Counsel,
if to be given by counsel, and shall comply with the requirements of the Trust
Indenture Act and any other requirements set forth in this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
--------------------------------------
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based
-9-
<PAGE>
are erroneous. Any such certificate or opinion of counsel may be based, insofar
as it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 104. Acts of Holders; Record Dates.
-----------------------------
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Indenture to be given or
taken by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
-10-
<PAGE>
(c) The ownership of Securities shall be proved by the Security
Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made upon
such Security.
The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Company may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next paragraph. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date; provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
by Holders of the requisite principal amount of Outstanding Securities of such
series on such record date. Nothing in this paragraph shall be construed to
prevent the Company from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any Person
be cancelled and of no effect), and nothing in this paragraph shall be construed
to render ineffective any action taken by Holders of the requisite principal
amount of Outstanding Securities of the relevant series on the date such action
is taken. Promptly after any record date is set pursuant to this paragraph, the
Company, at its own expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given to the
Trustee in writing and to each Holder of Securities of the relevant series in
the manner set forth in Section 106.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to join
in the giving or
-11-
<PAGE>
making of (i) any Notice of Default, (ii) any declaration of acceleration
referred to in Section 502, (iii) any request to institute proceedings referred
to in Section 507(2) or (iv) any direction referred to in Section 512, in each
case with respect to Securities of such series. If any record date is set
pursuant to this paragraph, the Holders of Outstanding Securities of such series
on such record date, and no other Holders, shall be entitled to join in such
notice, declaration, request or direction, whether or not such Holders remain
Holders after such record date; provided that no such action shall be effective
hereunder unless taken on or prior to the applicable Expiration Date by Holders
of the requisite principal amount of Outstanding Securities of such series on
such record date. Nothing in this paragraph shall be construed to prevent the
Trustee from setting a new record date for any action for which a record date
has previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no actin by any Person be cancelled
and of no effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite principal amount of
Outstanding Securities of the relevant series on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Trustee,
at the Company's expense, shall cause notice of such record, the proposed action
by Holders and the applicable Expiration Date to be given to the Company in
writing and to each Holder of Securities of the relevant series in the manner
set forth in Section 106.
With respect to any record date set pursuant to this Section, the
party hereto which set such record dates may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the other party hereto in
writing, and to each Holder of Securities of the relevant series in the manner
set forth in Section 106, on or prior to the existing Expiration Date. If an
Expiration Date is not designated with respect to any record date set pursuant
to this Section, the party hereto which set such record date shall be deemed to
have initially designated the 180th day after such record date as the Expiration
Date with respect thereto, subject to its right to change the Expiration Date as
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
Without limiting the foregoing, a Holder entitled hereunder to take
any action hereunder with regard to any particular Security may do so with
regard to all or any part
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<PAGE>
of the principal amount of such Security or by one or more duly appointed agents
each of which may do so pursuant to such appointment with regard to all or any
part of such principal amount.
Section 105. Notices, Etc. to Trustee and Company.
------------------------------------
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, Attention: Corporate
Trust Administration, or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
in writing and mailed, first-class postage prepaid, to the Company
addressed to it at the address of its principal office specified in the
first paragraph of this instrument or at any other address previously
furnished in writing to the Trustee by the Company.
Section 106. Notice to Holders; Waiver.
-------------------------
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be
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<PAGE>
impracticable to give such notice by mail, then such notification as shall be
made with the approval of the Trustee shall constitute a sufficient notification
for every purpose hereunder.
Section 107. Conflict with Trust Indenture Act.
---------------------------------
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act which is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act which may be so modified or excluded, the latter provision shall
be deemed to apply to this Indenture as so modified or to be excluded, as the
case may be.
Section 108. Effect of Headings and Table of Contents.
----------------------------------------
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns.
----------------------
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
Section 110. Separability Clause.
-------------------
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 111. Benefits of Indenture.
---------------------
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, the Security Registrar, any Paying Agent and any other agent of the
Company appointed hereunder and the Holders, any benefit or any legal or
equitable right, remedy or claim under this Indenture.
Section 112. Governing Law.
-------------
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<PAGE>
This Indenture and the Securities shall be governed by and construed
in accordance with the laws of the State of New York.
Section 113. Legal Holidays.
--------------
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the Securities
(other than a provision of any Security which specifically states that such
provision shall apply in lieu of this Section)) payment of interest or principal
(and premium, if any) need not be made at such Place of Payment on such date,
but may be made on the next succeeding Business Day at such Place of Payment
with the same force and effect as if made on the Interest Payment Date or
Redemption Date, or at the Stated Maturity, provided that no interest shall
accrue for the period from and after such Interest Payment Date, Redemption Date
or Stated Maturity, as the case may be.
ARTICLE TWO
Security Forms
Section 201. Forms Generally.
---------------
The Securities of each series shall be in substantially the form set
forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or Depositary therefor or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution thereof. If the form of Securities of any series is established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 303 for the authentication and delivery of such
Securities.
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<PAGE>
The Trustee's certificates of authentication shall be in substantially
the form set forth in this Article.
The definitive Securities shall be printed, lithographed or engraved
on steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Section 202. Form of Face of Security.
------------------------
[Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]
. . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . .
No. ......... $......
........................, a corporation duly organized and existing under the
laws of ...........(herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to .................., or registered assigns,
the principal sum of .......................... Dollars
on................................... [if the Security is to bear interest prior
to Maturity, insert -, and to pay interest thereon from .............. or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually on.......... and.......... in each year, commencing
..................., at the rate of ....% per annum, until the principal hereof
is paid or made available for payment [if applicable, insert - , provided that
any principal and premium, and any such instalment of interest, which is overdue
shall bear interest at the rate of ... % per annum (to the extent that the
payment of such interest shall be legally enforceable), from the dates such
amounts are due until they are paid or made available for payment, and such
interest shall be payable on demand]. The interest so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in
such Indenture, be paid to the Person in whose name this Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest, which shall be the ...... or......
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided
for will forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Security
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<PAGE>
(or one or more Predecessor Securities) is registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Securities of this
series not less than 10 days prior to such Special Record Date, or be paid at
any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Securities of this series may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in said Indenture].
[If the Security is not to bear interest prior to Maturity, insert - The
principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal and any overdue premium shall
bear interest at the rate of ....% per annum (to the extent that the payment of
such interest shall be legally enforceable), from the dates such amounts are due
until they are paid or made available for payment. Interest on any overdue
principal or premium shall be payable on demand. [Any such interest on overdue
principal or premium which is not paid on demand shall bear interest at the rate
of ...% per annum (to the extent that the payment of such interest on interest
shall be legally enforceable), from the date of such demand until the amount so
demanded is paid or made available for payment. Interest on any overdue
interest shall be payable on demand.]
Payment of the principal of (and premium, if any) and [if applicable,
insert - any such] interest on this Security will be made at the office or
agency of the Company maintained for that purpose in ........, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts [if applicable, insert - ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register].
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
-17-
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
..............................
By............................
Attest:
...................
Section 203. Form of Reverse of Security.
---------------------------
This Security is one of a duly authored issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or more
series under an Indenture, dated as of ........... (herein called the
"Indenture", which term shall have the meaning assigned to it in such
instrument), between the Company and ...................., as Trustee (herein
called the "Trustee", which term includes any successor trustee under the
Indenture), and reference is hereby made to the Indenture for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee[, the holders of Senior Debt] and the Holders of the
Securities and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof [if applicable, insert - . limited in aggregate principal amount
to $.......].
[If applicable, insert - The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, [if applicable, insert -
(1) on ........ in any year commencing with the year ..... and ending with the
year ..... through operation of the sinking fund for this series at a Redemption
Price equal to 100% of the principal amount, and (2)] at any time [If
applicable, insert - on or after ......., 19..], as a whole or in part, at the
election of the Company, at the following Redemption Prices (expressed as
percentages of the principal amount): If redeemed [if applicable, insert - on or
before .....................%, and if redeemed] during the 12-month period
beginning......... of the years indicated,
-18-
<PAGE>
Year Redemption Redemption
Price Price Year
- ---- ---------- ----------
and thereafter at a Redemption Price equal to ....% of the principal amount,
together in the case of any such redemption [if applicable, insert - (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert - The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ......... in any
year commencing with the year .... and ending with the year .... through
operation of the sinking fund for this series at the Redemption Prices for
redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if
applicable, insert - on or after.........], as a whole or in part, at the
election of the Company, at the Redemption Prices for redemption otherwise than
through operation of the sinking fund (expressed as percentages of the principal
amount) set forth in the table below: If redeemed during the 12-month period
beginning.........of the years indicated,
Redemption Price
For Redemption Redemption Price For
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
- ---- ----------------- ----------------------
and thereafter at a Redemption Price equal to ....% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest statements whose Stated Maturity is on or prior to
-19-
<PAGE>
such Redemption Date will be payable to the Holders of such Securities, or one
or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert - Notwithstanding the foregoing, the Company
may not, prior to redeem any Securities of this series as contemplated by [if
applicable, insert - Clause (2) off the preceding paragraph as a part of, or in
anticipation of, any refunding operation by the application, directly or
indirectly, of moneys borrowed having an interest cost to the Company
(calculated in accordance with generally accepted financial practice) of less
than....% per annum.]
[If applicable, insert - The sinking fund for this series provides for
the redemption on..........in each year beginning with the year......and ending
with the year.... of [If applicable, insert - not less than $.......("mandatory
sinking fund") and not more than] $....... aggregate principal amount of
Securities of this series. Securities of this series acquired or redeemed by the
Company otherwise than through [if applicable, insert - mandatory] sinking fund
payments may be credited against subsequent [if applicable, insert - mandatory]
sinning fund payments otherwise required to be made [if applicable, insert - ,
in the inverse order in which they become due].]
[If the Security is subject to redemption of any kind, insert - In the
event of redemption of this Security in part only, a new Security or Securities
of this series and of like tenor for the unredeemed portion hereof will be
issued in the name of the Holder, upon the cancellation hereof.]
[If applicable, insert paragraph regarding
subordination of the Security.]
[If applicable, insert - The Indenture contains provisions for
defeasance at any time of [the entire indebtedness of this Security) [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance with certain conditions set forth in
the Indenture.]
[If the Security is not an Original Issue Discount Security, insert -
If an Event of Default with respect to Securities of this series shall occur and
be continuing, the principal of the Securities of this series may be declared
-20-
<PAGE>
due and payable in the manner and with the effect provided in the Indenture.]
[If the Security is an Original Issue Discount Security, insert - If
an Event of Default with respect to Securities of this series shall occur and be
continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and interest (in each
case to the extent that the payment of such interest shall be legally
enforceable), all of the Company's obligations in respect of the payment of the
principal of and premium and interest, if any, on the Securities of this series
shall terminate.]
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any dime by the Company and the Trustee with the
consent of the Holders of 66 2/3% in principal amount of the Securities at the
time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable
-21-
<PAGE>
indemnity, and the Trustee shall not have received from the Holders of a
majority in principal amount of Securities of this series at the time
Outstanding a direction inconsistent with such request, and shall have failed to
institute any such proceeding, for 60 days after receipt of such notice, request
and offer of indemnity. The foregoing shall not apply to any suit instituted by
the Holder of this Security for the enforcement of any payment of principal
hereof or any premium or interest hereon on or after the respective due dates
expressed herein.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and any premium and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
this series and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $...... and any integral multiple thereof.
As provided in the Indenture ad subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate principal
amount of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof
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<PAGE>
for all purposes, whether or not this Security be overdue, ad neither the
Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
SECTION 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the
Securities evidenced thereby, every Global Security authenticated and delivered
hereunder shall bear a legend in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE
Section 205. Form of Trustee's Certificate
of Authentication.
-----------------------------
This is one of the Securities of the series
designated therein referred to in the within-mentioned Indenture.
First Fidelity Bank, N.A.
as Trustee
By
Authorized Officer
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.
------------------------------------
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
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<PAGE>
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series,
(1) the title of the Securities of the series (which shall distinguish
the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of
the series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 304, 305, 306, 906 or 1107 and except for any
Securities which, pursuant to Section 303, are deemed never to have been
authenticated and delivered hereunder);
(3) the Person to whom any interest on a Security of the series shall
be payable, if other than the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest;
(4) the date or dates on which the principal of any Securities of the
series is payable;
(5) the rate or rates at which any Securities of the series shall bear
interest, if any, the date or dates from which any such interest shall
accrue, the Interest Payment Dates on which any such interest shall be
payable and the Regular Record Date for any such interest payable on any
Interest Payment Date;
(6) the place or places where the principal of and any premium and
interest on any Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at which
and the terms and conditions upon which any Securities of the series may be
redeemed, in whole or in part, at the option of the Company and, if other
than by a Board Resolution, the manner in which any election by the Company
to redeem the Securities shall be evidenced;
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<PAGE>
(8) the obligation, if any, of the Company to redeem or purchase any
Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of the Holder thereof and the period or periods
within which, the price or prices at which and the terms and conditions
upon which any Securities of the series shall be redeemed or purchased, in
whole or in part, pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which any Securities of the series shall be
issuable;
(10) if the amount of principal of or any premium or interest on any
Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts shall be
determined;
(11) if other than the currency of the United States of America, the
currency, currencies or currency units in which the principal of or any
premium or interest on any Securities of the series shall be payable and
the manner of determining the equivalent thereof in the currency of the
United States of America for any purpose, including for purposes of the
definition of "Outstanding" in Section 101;
(12) if the principal of or any premium or interest on any Securities
of the series is to be payable, at the election of the Company or the
Holder thereof, in one or more currencies or currency units other than that
or those in which such Securities are stated to be payable, the currency,
currencies or currency units in which the principal of or any premium or
interest on such Securities as to which such election is made shall be
payable, the periods within which and the terms and conditions upon which
such election is to be made and the amount so payable (or the manner in
which such amount shall be determined);
(13) if other than the entire principal amount thereof, the portion of
the principal amount of any Securities of the series which shall be payable
upon declaration of acceleration of the Maturity thereof pursuant to
Section 502;
(14) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more
dates prior to the Stated Maturity, the amount which shall be deemed to be
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the principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall
be due and payable upon any Maturity other than the Stated Maturity or
which shall be deemed to be Outstanding as of any date prior to the Stated
Maturity (or, in any such case, the manner in which such amount deemed to
be the principal amount shall be determined);
(15) if applicable, that the Securities of the series, in whole or any
specified part, shall be defeasible pursuant to Section 1302 or Section
1303 or both such Sections and, if other than by a Board Resolution, the
manner in which any election by the Company to defease such Securities
shall be evidenced;
(16) if applicable, that any Securities of the series shall be
issuable in whole or in part in the form of one or more Global Securities
and, in such case, the respective Depositaries for such Global Securities,
the form of any legend or legends which shall be borne by any such Global
Security in addition to or in lieu of that set forth in Section 204 and any
circumstances in addition to or in lieu of those set forth in Clause (2) of
the last paragraph of Section 305 in which any such Global Security may be
exchanged in whole or in part for Securities registered, and any transfer
of such Global Security in whole or in part may be registered, in the name
or names of Persons other than the Depositary for such Global Security or a
nominee thereof;
(17) 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 502;
(18) any addition to or change in the covenants set forth in Article
Ten which applies to Securities of the series; and
(19) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as permitted by
Section 901(5)).
All Securities of any one series shall be substantially identical
except as to denomInation and except as may otherwise be provided in or pursuant
to the Board Resolution referred to above and (subject to Section 303)
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set forth, or determined in the manner provided, in the Officers' Certificate
referred to above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
Section 302. Denominations.
-------------
The Securities of each series shall be issuable in registered form
without coupons in such denominations as shall be specified as contemplated by
Section 301. In the absence of any such provisions with respect to the
Securities of any series, the Securities of such series shall be issuable in
denominations of $1,000 and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
----------------------------------------------
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its President, its Vice Chairman, or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities. If the
form or terms of the Securities of the series have been established in or
pursuant to one or more Board Resolutions as permitted by Sections 201 and 301,
in authenticating such Securities, and accepting the additional responsibilities
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under this Indenture in relation to such Securities, the Trustee shall be
entitled to receive, and (subject to Section 601) shall be fully protected in
relying upon, an Officers' Certificate and an Opinion of Counsel (pursuant to
Section 102) stating,
(a) if the form of such Securities has been established by or
pursuant to Board Resolution as permitted by Section 201, that such form
has been established in conformity with the provisions of this Indenture;
(b) if the terms of such Securities have been established by or
pursuant to Board Resolution as permitted by Section 301, that such terms
have been established in conformity with the provisions of this Indenture;
and
(c) that such Securities, when authenticated and delivered by the
Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company, enforceable in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and other laws of general applicability relating
to or affecting the enforcement of creditors' rights and to general equity
principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 301 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
Each Security shall be dated the date of its authentication.
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No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder and is entitled to the
benefits of this Indenture.
Notwithstanding the foregoing, if any Security shall have been
authenticated and delivered hereunder but never issued and sold by the Company,
and the Company shall deliver such Security to the Trustee for cancellation as
provided in Section 309, for all purposes of this Indenture such Security shall
be deemed never to have been authenticated and delivered hereunder and shall
never be entitled to the benefits of this Indenture.
Section 304. Temporary Securities.
--------------------
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company will
cause definitive Securities of that series to be prepared without unreasonable
delay. After the preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of the Company in a Place of Payment for that
series, without charge to the Holder. Upon surrender for cancellation of any
one or more temporary Securities of any series the Company shall execute and the
Trustee shall authenticate and deliver in exchange therefor a like principal
amount of definitive Securities of the same series of authorized denominations.
Until so exchanged the temporary Securities of any series shall in all respects
be entitled to the same benefits under this Indenture as definitive Securities
of such series.
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Section 305. Registration, Registration of
Transfer and Exchange.
-----------------------------
The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register (the register maintained in such office and in any other
office or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is
hereby appointed "Security Registrar" for the purpose of registering Securities
and transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of any
series at the office or agency in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of a like aggregate
principal amount.
At the option of the Holder, Securities of any series may be exchanged
for other Securities of the same series, of any authorized denominations and of
a like aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or
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other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Securities, other than exchanges
pursuant to Section 304, 906 or 1107 not involving any transfer.
If the Securities of any series (or any series and specified tenor)
are to be redeemed in part, the Company shall not be required (i) to issue,
register the transfer of or exchange Securities of that series (or that series
and tenor, as the case may be) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of
Securities of that series selected for redemption under Section 1103 and ending
at the close of business on the day of such mailing, or (ii) to register the
transfer of or exchange any Security so selected for redemption in whole or in
part, except the unredeemed portion of any Security being redeemed in part.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only
to Global Securities:
(1) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global
Security or a nominee thereof and delivered to such Depositary or a nominee
thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered,
and no transfer of a Global Security in whole or in part may be registered,
in the name of any Person other than the Depositary for such Global
Security or a nominee thereof unless (A) such Depositary (i) has notified
the Company that it is unwilling or unable to continue as Depositary for
such Global Security or (ii) has ceased to be a clearing agency registered
under the Exchange Act, (B) there shall have occurred and be continuing an
Event of Default with respect to such Global Security or (C) there shall
exist such circumstances, if any, in addition to or in lieu of the
foregoing as have been specified for this purpose as contemplated by
Section 301.
(3) Subject to Clause (2) above, any exchange of a Global Security for
other Securities may be made in whole or in part, and all Securities issued
in exchange for a Global Security or any portion thereof shall be
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registered in such names as the Depositary for such Global Security shall
direct.
(4) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any
portion thereof, whether pursuant to this Section, Section 304, 306, 906 or
1107 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such Security is registered in the name
of a Person other than the Depositary for such Global Security or a nominee
thereof.
Section 306. 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.
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 deliver, 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,
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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 307. Payment of Interest; Interest
Rights Preserved.
-----------------------------
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, interest on any Security which is payable,
and is punctually paid or duly provided for, on any Interest Payment Date shall
be paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Any interest on any Security of any series which is payable, but is
not punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each Security of such series and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted Interest as in this Clause provided. Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted Interest
which shall be not more than
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15 days and not less than 10 days prior to the date of the proposed payment
and not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify the Company of
such Special Record Date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be given to each Holder of
Securities of such series in the manner provided by Section 106, not less
than 10 days prior to such Special Record Date. Notice of the proposed
payment of such Defaulted Interest and the Special Record Date therefor
having been so mailed, such Defaulted Interest shall be paid to the Persons
in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on such
Special Record Date and shall no longer be payable pursuant to the
following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
Section 308. Persons Deemed Owners.
---------------------
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of (and premium, if
any) and (subject to Section 307) interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Section 309. Cancellation.
------------
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All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of as directed by a Company
Order.
Section 310. Computation of Interest.
-----------------------
Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a year of twelve 30-day months.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
---------------------------------------
This Indenture shall upon Company Request 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
(1) either
(A) all Securities theretofore authenticated and delivered
(other than (i) Securities which have been destroyed, lost or stolen
and which have been replaced or paid as provided in Section 306 and
(ii) Securities for whose payment money has theretofore been deposited
in trust or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such
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trust, as provided in Section 1003) have been delivered to the Trustee
for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of
the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose an amount sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore delivered to
the Trustee for cancellation, for principal (and premium, if any) and
interest to the date of such deposit (in the case of Securities which
have become due and payable) or to the Stated Maturity or Redemption
Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) 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 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
--------------------------
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Subject to the provisions of the last paragraph of Section 1003, all
money deposited with the Trustee pursuant to Section 401 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 premium, if
any) and interest for whose payment such money has been deposited with the
Trustee.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
-----------------
"Event of Default", wherever used herein with respect to Securities of
any series, mens any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) default in the payment of any interest upon any Security of that
series when it becomes due and payable, and continuance of such default for
a period of 30 days; or
(2) default in the payment of the principal of (or premium, if any,
on) any Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere in
this Section specifically dealt with or which has expressly been included
in this Indenture solely for the benefit of series of Securities other than
that series), and continuance of such default or breach for a period of 60
days after there has been given, by registered or certified mail, to the
Company by the Trustee or to the Company and the Trustee by the Holders of
at least 10% in principal amount of the Outstanding Securities of
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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
(5) a default under any bond, debenture, note or other evidence of
indebtedness for money borrowed by the Company (including a default with
respect to Securities of any series other than that series) or under any
mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any indebtedness for money borrowed
by the Company (including this Indenture), whether such indebtedness now
exists or shall hereafter be created, which default shall constitute a
failure to pay any portion of the principal of such indebtedness in an
aggregate amount of $10,000,000 or more when due and payable after the
expiration of any applicable grace period with respect thereto or shall
have resulted in such indebtedness in an aggregate amount of $10,000,000 or
more becoming or being declared due and payable prior to the date on which
it would otherwise have become due and payable, without such indebtedness
having been discharged, or such acceleration having been rescinded or
annulled, within a period of 10 days after there shall have been given, by
registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the Holders of at least 10% in principal amount
of the Outstanding Securities of that series a written notice specifying
such default and requiring the Company to cause such indebtedness to be
discharged or cause such acceleration to be rescinded or annulled and
stating that such notice is a "Notice of Default" hereunder; provided,
--------
however, that, subject to the provisions of Sections 601 and 602, the
-------
Trustee shall not be deemed to have knowledge of such default unless either
(A) a Responsible Officer of the Trustee shall have actual knowledge of
such default or (B) the Trustee shall have received written notice thereof
from the Company, from any Holder, from the holder of any such indebtedness
or from the trustee under any such mortgage, indenture or other instrument;
or
(6) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in
respect of the Company
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under any applicable Federal or State law, or appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and the continuance
of any such decree or order for relief or any such other decree or order
unstayed and in effect for a period of 90 consecutive days; or
(7) the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of the Company in an involuntary
case or proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law or to the commencement of
any bankruptcy or insolvency case or proceeding against it, or the filing
by it of a petition or answer or consent seeking reorganization or relief
under any applicable Federal or State law, or the consent by it to the
filing of such petition or to the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator or similar
official of the Company or of any substantial part of its property, or the
making by it of an assignment for the benefit of creditors, or the
admission by it in writing of its inability to pay its debts generally as
they become due, or the taking of corporate action by the Company in
furtherance of any such action; or
(8) any other Event of Default provided with respect to Securities of
that series.
Section 502. 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 the
Securities of that series are Original Issue Discount Securities, such portion
of the principal amount as may be specified in the terms of that series) of all
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 prin-
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cipal amount (or specified amount) shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in 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
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) 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,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates prescribed
therefor in such Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default with respect to 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 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits
for Enforcement by Trustee.
------------------------------------
The Company covenants that if
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(1) 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
(2) default is made in the payment of the principal of (or premium,
if any, on) any Security at the Maturity thereof,
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 premium, if any) and interest and, to the extent
that payment of such interest shall be legally enforceable, interest on any
overdue principal (and premium, if any) and on any overdue interest, at the rate
or rates prescribed therefor in such Securities, and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon such Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon such Securities, wherever
situated.
If an Event of Default with respect to 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 504. Trustee May File Proofs of Claim.
--------------------------------
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective
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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 to take any and all actions authorized under the Trust
Indenture Act in order to have claims of the Holders and the Trustee allowed in
any such proceeding. In particular, the Trustee shall be authorized;
(i) to file and prove a claim for the whole amount of principal
(and premium, if any) 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
(ii) 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 607.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
Section 505. Trustee May Enforce Claims Without
Possession of Securities.
----------------------------------
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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 506. Application of Money Collected.
------------------------------
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal (or premium,
if any) 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
607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) 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 premium, if
any) and interest, respectively.
Section 507. 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
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
series;
(2) the Holders of 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,
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(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 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 of such
Holders.
Section 508. Unconditional Right of Holders to
Receive Principal, Premium 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 premium, if any) and (subject to
Section 307) interest on such Security on the Stated Maturity or 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 509. Restoration of Rights and Remedies.
----------------------------------
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
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Section 510. Rights and Remedies Cumulative.
------------------------------
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last paragraph
of Section 306, no right or remedy herein conferred upon or reserved to the
Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
----------------------------
No delay or omission of the Trustee or of any Holder of any Securities
to exercise any right or remedy 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 512. 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
(1) such direction shall not be in conflict with any rule of law or
with this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Section 513. Waiver of Past Defaults.
-----------------------
The Holders of not less than a majority in principal amount of the
Outstanding Securities 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
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(1) in the payment of the principal of (or premium, if any) or
interest on any Security of such series, or in the making of any sinking
fund payment, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
Section 514. Undertaking for Costs.
---------------------
All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 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 premium,
if any) or interest on any Security on or after the Stated Maturity or
Maturities expressed in such Security (or, in the case of redemption, on or
after the Redemption Date).
Section 515. Waiver of Stay or Extension Laws.
--------------------------------
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby
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expressly waives all benefit or advantage of any such law and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
-----------------------------------
The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
Section 602. Notice of Defaults.
------------------
If a default occurs hereunder with respect to Securities of any
series, the Trustee shall give the Holders of Securities of such series notice
of such default as and to the extent provided by the Trust Indenture Act;
provided, however, that in the case of any default of the character specified in
Section 501(4) with respect to Securities of such series, no such notice to
Holders shall be given until at least 30 days after the occurrence thereof. For
the purpose of this Section, the term "default" means any event which is, or
after notice or lapse of time or both would become, an Event of Default with
respect to Securities of such series.
Section 603. Certain Rights of Trustee.
-------------------------
Subject to the provisions of Section 601:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond,
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debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a
Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the
Company, personally or by agent or attorney; and
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the
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Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder.
Section 604. Not Responsible for Recitals or Issuance of
-------------------------------------------
Securities.
----------
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and neither the Trustee nor the Authenticating Agent assumes any
responsibility for their correctness. Neither the Trustee nor the
Authenticating Agent makes any representations as to the validity or sufficiency
of this Indenture or of the Securities. Neither the Trustee nor the
Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof.
Section 605. May Hold Securities.
-------------------
The Trustee, any Paying Agent, any Security Registrar or any other
agent of the Company, in its individual or any other capacity, may become the
owner or pledgee of Securities and, subject to Sections 608 and 613, may
otherwise deal with the Company with the same rights it would have if it were
not Trustee, Paying Agent, Security Registrar or such other agent.
Section 606. Money Held in Trust.
-------------------
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.
Section 607. Compensation and Reimbursement.
------------------------------
The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee
of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any
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provision of this Indenture (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negligence
or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses of
defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
Section 608. Disqualification; Conflicting Interests.
---------------------------------------
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to
Securities of more than one series [or a trustee under -- list here any prior
indentures between the Company and the Trustee that have not been satisfied and
discharged and that may be excluded by the proviso to Section 310(b)(1) of the
Trust Indenture Act.]
Section 609. Corporate Trustee Required; Eligibility.
---------------------------------------
There shall at all times be one (and only one) Trustee hereunder with
respect to the Securities of each series, which may be Trustee hereunder for
Securities of one or more series. Each Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such [,--and] has a
combined capital and surplus of at least $50,000,000 [and has its Corporate
Trust Office in .............]. If any such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then for the purposes of this Section and to
the extent permitted by the Trust Indenture Act, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. IF at any time
the Trustee with respect to the Securities of any series shall cease to be
eligible in accordance with the provisions of this Section,
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it shall resign immediately in the manner and with the effect hereinafter
specified in this Article.
Section 610. Resignation and Removal, Appointment of
---------------------------------------
Successor.
---------
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.
(b) The Trustee may resign at any time with respect to the Securities
of one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 611 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Securities of such series, delivered to the Trustee and to
the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608 after
written request therefor by the Company or by any Holder who has been
a bona fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and
shall fail to resign after written request therefor by the Company or
by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (ii) subject to Section 514, any
Holder who
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has been a bona fide Holder of a Security for at least six months may, on behalf
of himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to all Securities and
the appointment of a successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Securities of that or those series (it being understood that any such
successor Trustee may be appointed with respect to the Securities of one or more
or all of such shares and that at any time there shall be only one Trustee with
respect to the Securities of any particular series) and shall comply with the
applicable requirements of Section 611. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy a
successor Trustee with respect to the Securities of any shares shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
611, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any series shall have
been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
(f) The Company shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series to all
Holders of Securities of such series in the manner provided in Section 106.
Each notice shall include the name of the successor Trustee with respect to the
Securities of such series and the address of its Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor.
--------------------------------------
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<PAGE>
(a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or
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those series to which the appointment of such successor Trustee relates; but, on
request of the Company or any successor Trustee, such retiring Trustee shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder with respect to the Securities of
that or those series to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under this Article.
Section 612. Merger, Conversion, Consolidation or
------------------------------------
Succession to Business.
----------------------
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article without
the execution or filing of any paper or any further act on the part of any of
the parties hereto. In case any Securities shall have been authenticated, but
not delivered, by the Trustee then in office, any successor by merger conversion
or consolidation to such authenticating Trustee may adopt such authentication
and deliver the Securities so authenticated with the same effect as if such
successor Trustee had itself authenticated such Securities.
Section 613. Preferential Collection of Claims Against
-----------------------------------------
Company.
-------
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
Section 614. Appointment of Authenticating Agent.
-----------------------------------
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The Trustee may appoint an Authenticating Agent or Agents with respect
to one or more series of Securities which shall be authorized to act on behalf
of the Trustee to authenticate Securities of such series issued upon original
issue and upon exchange, registration of transfer or partial redemption thereof
or pursuant to Section 306, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by a Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
an Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agency.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of a Authenticating Agent by giving written notice thereof
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to such Authenticating Agent and to the Company. Upon receiving such a notice
of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as a Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 607.
If a appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
,
----------------------------
As Trustee
By ,
----------------------------
As Authenticating Agent
By
-------------------------
Authorized Officer
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ARTICLE SEVEN
Holders' List and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses of Holders.
---------------------------------------------------------
The Company will furnish or cause to be furnished to the Trustee
(a) semi-annually, not later than 15 days after each Regular Record
Date for each series of Securities at the time Outstanding, a list, in such
form as the Trustee may reasonably require, of the names and addresses of
the Holders as of such Regular Record Date (or on a date to be determined
pursuant to Section 301 for any series of Original Issue Discount
Securities), and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the
time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Section 702. Preservation of Information; Communications to Holders.
------------------------------------------------------
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 701 and the
names and addresses of Holders received by the Trustee in its capacity as
Security Registrar. The Trustee may destroy any list furnished to it as
provided in Section 701 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and
the corresponding rights and privileges of the Trustee, shall be as
provided by the Trust indenture Act.
(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any agent of either of them shall be held accountable
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by reason of any disclosure of information as to names and addresses of
Holders made pursuant to the Trust Indenture Act.
Section 703. Reports by Trustee.
------------------
The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when any Securities are listed on any stock exchange.
Section 704. Reports by Company.
------------------
The Company shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the
Trustee within 15 days after the same is so required to be filed with the
Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on Certain Terms.
----------------------------------------------------
The Company shall not consolidate with or merge into any other person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge into the Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into another
person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, the person formed by such consolidation
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or into which the Company is merged or the Person which acquires by
conveyance or transfer, or which leases, the properties and assets of the
Company substantially as an entirety shall be a corporation, partnership or
trust, shall be organized and validly existing under the laws of the United
States of America, any State thereof or the District of Columbia and shall
expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of the principal of (and premium, if any) and interest on
all the Securities and the performance or observance of every covenant of
this Indenture on the part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction and treating
any indebtedness which becomes an obligation of the Company or a Subsidiary
as a result of such transaction as having been incurred by the Company or
such Subsidiary at the time of such 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 happened and be continuing;
(3) if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, properties or assets of the Company would
become subject to a mortgage, pledge, lien, security interest or other
encumbrance which would not be permitted by this Indenture, the Company or
such successor corporation or Person, as the case may be, shall take such
steps as shall be necessary effectively to secure the Securities equally
and ratably with (or prior to) all indebtedness secured thereby; and
(4) in case the Company shall consolidate with or merge into another
corporation or convey, transfer or lease its properties and assets
substantially as an entity to any Person, the Company has delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such transaction,
such supplemental indenture comply with this Article and that all
conditions precedent herein provided for relating to such transaction have
been complied with.
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Section 802. Successor Corporation Substituted.
---------------------------------
Upon any consolidation by the Company with or merger by the Company
into any other person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety in accordance with Section
801, the successor person formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor person shall be relieved of all obligations and covenants
under this Indenture and the Securities.
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.
--------------------------------------------------
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another person to the Company and
the assumption by any such successor of the covenants of the Company herein
and in the Securities; or
(2) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred upon the
Company; or
(3) to add any additional Events of Default for the benefit of the
Holders of all or any series of Securities (and if such additional Events
of Default are to be for the benefit of less than all series of Securities,
stating that such additional Events of Default are expressly being included
solely for the benefit of such series); or
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(4) to add to or change any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to permit or facilitate the
issuance in uncertified form; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities, provided that any
such addition, change or elimination (A) shall neither (i) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (ii) modify the
rights of the Holder of any such Security with respect to such provision or
(B) shall become effective only when there is no such Security Outstanding;
or
(6) to secure the Securities pursuant to the requirements of Section
1006 or otherwise; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 611(b); or
(9) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture, provided such action pursuant to
--------
this Clause (9) shall not adversely affect the interests of the Holders of
Securities of any series in any material respect.
Section 902. Supplemental Indentures with Consent of Holders.
-----------------------------------------------
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution,
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and the Trustee may enter into an indenture or indentures supplemental hereto
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders of Securities of such series under this
Indenture; provided, however, that no such supplemental indenture shall, without
-------- -------
the consent of the Holder of each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment
of principal of or interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon
the redemption thereof, or reduce the amount of the principal of an
Original Issue Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section
502, or change any Place of Payment where, or the coin or currency in
which, any Security or any premium or interest thereon is payable, or
impair the right to institute suit for the enforcement of any such payment
on or after the Stated Maturity thereof (or, in the case of redemption, on
or after the Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required
for any waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in this
Indenture, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1010, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security affected
thereby, provided, however, that this clause shall not be deemed to require
-------- -------
the consent of any Holder with respect to changes in the references to "the
Trustee" and concomitant changes in this Section and Section 1010, or the
deletion of this proviso, in accordance with the requirements of Sections
611(b) and 901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with
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respect to such covenant or other provision, shall be deemed not to affect the
rights under this Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
------------------------------------
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Section 904. Effect of Supplemental Indentures.
---------------------------------
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
-----------------------------------
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
Section 906. Reference in Securities to Supplemental Indentures.
--------------------------------------------------
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and
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authenticated and delivered by the Trustee in exchange for Outstanding
Securities of such series.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium 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 premium,
if any) and interest on the Securities of that series in accordance with the
terms of the Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
-------------------------------
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities of that series and this Indenture
may be served, which office or agency shall initially be the Corporate Trust
Office of the Trustee located in the Borough of Manhattan, The City of New York,
New York. The Company will give prompt written notice to the Trustee of any
change in the location of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the 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 other
offices or agencies where the Securities of one or more series may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
-------- -------
shall in any manner relieve the Company of its obligation to maintain an office
or agency in each Place of Payment 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 location of any such
other office or agency.
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Section 1003. Money for Securities to Be Held in Trust.
----------------------------------------
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of (and premium, if any) or interest on any of the Securities of that
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal (and premium, if any) or interest
so becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided and will promptly notify the Trustee of its
action or failure so to act.
Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, prior to each due date of the principal of (and
premium, if any) or interest on any Securities of that series, deposit with a
Paying Agent a sum sufficient to pay the principal (and premium, if any) or
interest so becoming due, such sum to be held, as provided by the Trust
Indenture Act, in trust for the benefit of the Persons entitled to such
principal, premium or interest, and (unless such Paying Agent is the Trustee)
the Company will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of Securities
other than the Trustee to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to the provisions
of this Section, that such Paying Agent will (1) comply with the provisions of
the Trust Indenture Act applicable to it as a Paying Agent and (2) during the
continuance of any default by the Company (or any other obligor upon the
Securities of that series) in the making of any payment in respect of the
Securities of that series, upon the written request of the Trustee, forthwith
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
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Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of (and premium, if
any) or interest on any Security of any series and remaining unclaimed for three
years after such principal (and premium, if any) or interest has become due and
payable shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
-------- -------
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in a newspaper published in
the English language, customarily published on each Business Day and of general
circulation in each Place of Payment, or mailed to such Holder, or both, notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than 30 days from the date of such publication or
mailing, as the case may be, any unclaimed balance of such money then remaining
will be repaid to the Company.
Section 1004. Corporate Existence.
-------------------
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence, rights (charter and statutory) and franchises; provided, however,
-------- -------
that the Company shall not be required to preserve any such right or franchise
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 that the loss
thereof is not disadvantageous in any material respect to the Holders.
Section 1005. Maintenance of Properties.
-------------------------
The Company will cause all properties used or useful in the conduct of
its business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
-------- -------
nothing in this Section shall prevent the Company from discontinuing the
operation
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or maintenance of any of such properties if such discontinuance is, in the
judgment of the Company, desirable in the conduct of its business or the
business of any Subsidiary and not disadvantageous in any material respect to
the Holders.
Section 1006. Limitation on Liens.
-------------------
(a) Except to the extent provided in Section 1008, the Company will
not create or assume, and will not permit any Restricted Subsidiary to create or
assume, any mortgage, security interest, pledge or lien (collectively in this
Article Ten referred to as a "lien") of or upon any Principal Property or shares
of capital stock or indebtedness of any Restricted Subsidiary, whether owned at
the date of this Indenture or thereafter acquired, without making effective
provision, and the Company in such case will make or cause to be made effective
provision whereby the Outstanding Securities shall be secured by such lien
equally and ratably with any and all other indebtedness or obligations thereby
secured so long as such other indebtedness or obligations shall be secured;
provided that the foregoing shall not apply to any of the following:
(i) liens on any Principal Property existing at the time that it
is acquired by the Company or any Restricted Subsidiary; or liens on any
Principal Property acquired, constructed or improved by the Company or any
Restricted Subsidiary after the date of this Indenture which are Created or
assumed contemporaneously with, or within 180 days after (or, in the case
of any such Principal Property which is being financed on the basis of
long-term contracts or similar financing arrangements for which a firm
commitment is made by one or more banks, insurance companies or other
lenders or investors (not including the Company or any Restricted
Subsidiary), within 360 days after) the completion of such acquisition
construction or improvement to secure or provide for the payment of any
part of the purchase price of such property or the cost of such
construction or improvement;
(ii) liens on property or shares of capital stock or indebtedness
of a corporation existing at the time such corporation is merged into or
consolidated with the Company or a Restricted Subsidiary or at the time of
a sale, lease or other disposition of the properties of a corporation as an
entirety or substantially as an entirety to the Company or a Restricted
Subsidiary;
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(iii) liens on property or shares of capital stock or
indebtedness of a corporation existing at the time such corporation becomes
a Restricted Subsidiary;
(iv) liens to secure indebtedness of a Restricted Subsidiary to
the Company or to another Restricted Subsidiary, but only so long as such
indebtedness is held by the Company or a Restricted Subsidiary;
(v) liens in favor of the United States of America or any state
thereof, or any department, agency or political subdivision of the United
States of America or any state thereof, to secure partial, progress,
advance or other payments pursuant to any contract or statute, including
without limitation, liens to secure indebtedness represented by pollution
control or industrial revenue bonds, or to secure any indebtedness incurred
for the purpose of financing all or any part of the purchase price or the
cost of constructing or improving the property subject to such liens;
(vi) liens in favor of any customer arising in respect of
partial, progress, advance or other payments made by or on behalf of such
customer for goods produced for or services rendered to such customer in
the ordinary course of business not exceeding the amount of such payments;
(vii) liens existing at the date of this Indenture;
(viii) mechanics', workers', repairmen's, materialmen's,
warehousemen's carriers' or other similar liens arising in the ordinary
course of business;
(ix) pledges or deposits under the workers' compensation laws or
similar legislation and liens of judgments thereunder which are not
currently dischargeable, or good faith deposits in connection with bids,
tenders, contracts (other than for the payment of money) or leases to which
the Company or any Restricted Subsidiary is a party, or deposits in
connection with obtaining or maintaining self-insurance or to obtain the
benefits of any law, regulation or arrangement pertaining to unemployment
insurance, old age pensions, social security or similar matters, or
deposits of cash or obligations of the United States of America to secure
surety, appeal or customs bonds to which the Company or any Restricted
Subsidiary is a
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party, or deposits in litigation or other proceedings such as, but not
limited to, interpleader proceedings;
(x) liens created by or resulting from any litigation or
proceedings which are being contested in good faith; liens arising out of
judgments or awards against the Company or any Restricted Subsidiary with
respect to which the Company or such Restricted Subsidiary is in good faith
prosecuting an appeal or proceedings for review; or liens incurred by the
Company or any Restricted Subsidiary for the purpose of obtaining a stay or
discharge in the course of any legal proceeding to which the Company or
such Restricted Subsidiary is a party;
(xi) liens for taxes or assessments or governmental charges or
levies not yet due or delinquent, or which can thereafter be paid without
penalty, or which are being contested in good faith by appropriate
proceedings; landlord's liens on property held under lease, and tenants'
rights under leases; and easements;
(xii) other liens incidental to the conduct of the business or the
ownership of the property and assets of the Company or a Restricted
Subsidiary which were not incurred in connection with the borrowing of
money or the obtaining of advances or credit, and which do not, in the
opinion of the Company, materially detract from the value of the property
or assets or materially impair the use thereof in the operation of the
business of the Company and its Restricted Subsidiaries taken as a whole;
(xiii) liens for the sole purpose of extending, renewing or
replacing in whole or in part any lien referred to in the foregoing clauses
(i) to (xii), inclusive, or in this clause (xiii), provided that the
principal amount of indebtedness secured thereby shall not exceed the
principal amount of any indebtedness so secured at the time of such
extension, renewal or replacement, and that such extension, renewal or
replacement shall be limited to all or a part of the property subject to
the lien so extended, renewed or replaced (plus improvements on such
property).
(b) For the purposes of Sections 1006, 1007 and 1008:
(i) "Attributable Debt" means, as to any particular lease under which
any Person is at the time
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liable, at any date as of which the amount thereof is to be determined, the
total net amount of rent required to be paid by such Person under such
lease during the remaining term thereof, excluding renewals at the option
of lessee, discounted at a rate per annum equal to the prevailing market
interest rate, at the time such lease was entered into, on United States
Treasury obligations having a maturity substantially the same as the
average term of such lease, plus 3%. The net amount of rent required to be
paid under any such lease for any such period shall be the amount of the
rent payable by the lessee with respect to such period, after excluding
amounts required to be paid on account of maintenance and repairs,
insurance, taxes, assessments, water rates and similar charges and
contingent rents such as those based on sales. In the case of any lease
which is terminable by the lessee upon the payment of a penalty, such net
amount shall also include the amount of such penalty, but no rent shall be
considered as required to be paid under such lease subsequent to the first
date upon which it may be so terminated.
(ii) "Consolidated Net Assets" means the total of all assets
after deducting all current liabilities appearing on a consolidated balance
sheet of the Company and its consolidated Subsidiaries, prepared in
accordance with generally accepted accounting principles, the assets to be
determined at their net book values (after deducting related depreciation,
depletion, amortization and all other valuation reserves which, in
accordance with such principles, should be set aside in connection with the
business conducted).
(iii) "Principal Property" means any manufacturing plant, research
facility or warehouse owned or leased by the Company or any Restricted
Subsidiary which is located within the United States of America and has a
net book value exceeding 2 1/2% of Consolidated Net Assets, but not
including (1) any property which in the opinion of the Board of Directors
of the Company is not of material importance to the total business
conducted by the Company as an entirety or (2) any portion of a particular
property which is similarly found not to be of material importance to the
use or operation of such property.
(iv) "Restricted Subsidiary" means a Subsidiary of the Company
which owns a Principal Property.
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Section 1007. Limitation on Sale and Lease-Back.
---------------------------------
Except to the extent provided in Section 1008, the Company will not,
nor will it permit any Restricted Subsidiary to, enter into any arrangement with
any Person providing for the leasing by the Company or any Restricted Subsidiary
of any Principal Property (except for leases of not more than three years and
except for leases between the Company and a Restricted Subsidiary or between
Restricted Subsidiaries), which property has been owned and operated by the
Company or any Restricted Subsidiary for more than 180 days and has been or is
to be sold or transferred by the Company or such Restricted Subsidiary to such
Person (in Section 1007 and in Section 1008 referred to as a "Sale and Lease-
Back Transaction") unless either (i) the Company or such Restricted Subsidiary
would be entitled to incur indebtedness secured by a lien on such property
without equally and ratably securing the Securities pursuant to the provisions
of Section 1006 or (ii) the Company shall apply an amount equal to the
Attributable Debt in respect of such Sale and Lease-Back Transaction to (1) the
acquisition of one or more Principal Properties of equal or greater aggregate
fair market value, (2) the retirement of indebtedness for borrowed money,
including the Securities, incurred or assumed by the Company or any Restricted
Subsidiary (other than indebtedness for borrowed money owed to the Company or
any Restricted Subsidiary) or (3) any combination of the foregoing; provided
--------
that the amount to be applied to the retirement of such indebtedness of the
- ----
Company or any Restricted Subsidiary shall be reduced by (i) the principal
amount of any Securities delivered within 180 days after such sale to the
Trustee for retirement and cancellation, and (ii) the principal amount of such
indebtedness, other than Securities, voluntarily retired by the Company within
180 days after such sale. Notwithstanding the foregoing, no retirement referred
to in clause (2) of the preceding sentence may be effected by payment at
maturity or pursuant to any mandatory sinking fund payment or any mandatory
prepayment provision.
Section 1008. Exemption from Limitations on Liens and Sale and Lease-Back.
-----------------------------------------------------------
Notwithstanding the provisions of Section 1006 and Section 1007, the
Company and its Restricted Subsidiaries may create or assume liens and enter
into Sale and Lease-Back Transactions which would otherwise require the securing
of the Securities, the acquisition of one or more Principal Properties or the
retirement of indebtedness for borrowed money under said provisions, provided
--------
that the aggregate amount of all such liens and Sale and Lease-Back
- ----
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<PAGE>
Transactions permitted by Section 1008 outstanding at the time such lien is
assumed or created or such Sale and Lease-Back Transaction is entered into (as
measured by (i) all indebtedness secured by all such liens then outstanding or
to be so created or assumed (and after giving effect to the retirement of any
indebtedness or obligations which are concurrently being retired) and (ii) the
Attributable Debt in respect of all such Sale and Lease-Back Transactions then
outstanding or to be so entered into) shall not exceed 10% of Consolidated Net
Assets, as determined in accordance with the most recent published consolidated
balance sheet of the Company and after giving effect to the receipt and
application of any proceeds of all indebtedness secured by all such liens so to
be created or assumed and of any Sale and Lease-Back Transactions so to be
entered into.
Section 1009. Statement by Officers as to Default.
-----------------------------------
The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of Sections 1001 to 1008, inclusive, and if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
Section 1010. Waiver of Certain Covenants.
---------------------------
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 1004 to 1008, inclusive, with
respect to the Securities of any series if before the time for such compliance
the Holders of at least 66 2/3% in principal amount of the Outstanding
Securities of such series shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such term,
provision or condition, but no such waiver shall extend to or affect such term,
provision or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall remain in
full force and effect.
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ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.
------------------------
Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified as contemplated by Section 301 for Securities of any series)
in accordance with this Article.
Section 1102. Election to Redeem; Notice to Trustee.
-------------------------------------
The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution or in another manner specified as contemplated
by Section 301 for such Securities. In case of any redemption at the election
of the Company of less than all the Securities of any series (including any such
redemption affecting only a single Security), the Company shall, at least 60
days prior to the Redemption Date fixed by the Company (unless a shorter notice
shall be satisfactory to the Trustee), notify the Trustee of such Redemption
Date, of the principal amount of Securities of such series to be redeemed and,
if applicable, of the tenor of the Securities to be redeemed. In the case of
any redemption of Securities prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or elsewhere in this
Indenture, the Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with such restriction.
Section 1103. Selection by Trustee of Securities to Be Redeemed.
-------------------------------------------------
If less than all the Securities of any series are to be redeemed
(unless all the Securities of such series and of a specified tenor are to be
redeemed or unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of a portion (equal to the minimum authorized denomination for
Securities of that series or any integral multiple thereof) of the principal
amount of any Security of such series, provided that the unredeemed portion of
the principal amount of any Security shall be in an authorized denomination
(which shall not be less than the minimum authorized denomination) for such
Security.
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<PAGE>
The Trustee shall promptly notify the Company and each Security
Registrar in writing of the Securities selected for redemption as aforesaid and,
in case of any Securities selected for partial redemption as aforesaid, the
principal amount thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
Section 1104. Notice of Redemption.
--------------------
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series
consisting of more than a single Security are to be redeemed, the
identification (and, in the case of partial redemption of any such
Securities, the principal amounts) of the particular Securities to be
redeemed and, if less than all the Outstanding Securities of any series
consisting of a single Security are to be redeemed, the principal amount of
the Security to be redeemed,
(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
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<PAGE>
(5) the place or places where such Securities are to be surrendered
for payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
Section 1105. Deposit of Redemption Price.
---------------------------
Prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
money sufficient to pay the Redemption Price of, and (except if the Redemption
Date shall be an Interest Payment Date) accrued interest on, all the Securities
which are to be redeemed on that date.
Section 1106. Securities Payable on Redemption Date.
-------------------------------------
Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with accrued interest
to the Redemption Date; provided, however, that, unless otherwise specified as
-------- -------
contemplated by Section 301, instalments of interest whose Stated Maturity is on
or prior to the Redemption Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Record Dates according to their terms and the
provisions of Section 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
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<PAGE>
Section 1107. Securities Redeemed in Part.
---------------------------
Any Security which is to be redeemed only in part shall be surrendered
at a Place of Payment therefor (with, if the Company or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities of the same series and of like tenor, of
any authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.
------------------------
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities of a series except as otherwise specified as
contemplated by Section 301 for Securities of such series.
The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment", and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Securities of any
series, the cash amount of any sinking fund payment may be subject to reduction
as provided in Section 1202. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
-----------------------------------------------------
The Company (1) may deliver Outstanding Securities of a series (other
than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities, in each
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<PAGE>
case in satisfaction of all or any part of any sinking fund payment with respect
to the Securities of such series required to be made pursuant to the terms of
such Securities as provided for by the terms of such series; provided that such
--------
Securities to be so credited have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
-----------------------------------------
Not less than 60 days prior to each sinking fund payment date for any
series of Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting Securities of that series
pursuant to Section 1202 and will also deliver the Trustee any Securities to be
so delivered. Not less than 30 days before each such sinking fund payment date
the Trustee shall select the Securities to be redeemed upon such sinking fund
payment date in the manner specified in Section 1103 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 1104. Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the manner
stated in Sections 1106 and 1107.
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Applicability of Article; Company's Option to Effect Defeasance
---------------------------------------------------------------
or Covenant Defeasance.
----------------------
If pursuant to Section 301 provision is made for either or both of (a)
defeasance of the Securities of a series under Section 1302 or (b) covenant
defeasance of the Securities of a series under Section 1303, then the provisions
of such Section or Sections, as the case may be, together with the other
provisions of this Article Thirteen, shall be applicable to the Securities of
such series, and the Company may at any time elect (such election to be
evidenced by a Board Resolution), with respect to the Securities of such series,
either to effect such a defeasance pursuant to Section 1302 (if applicable) or
to
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<PAGE>
effect such a covenant defeasance pursuant to Section 1303 (if applicable) in
respect of the Outstanding Securities of such series upon compliance with the
conditions set forth below in this Article Thirteen.
Section 1302. Defeasance and Discharge.
------------------------
Upon the Company's election to effect a defeasance with respect to the
Securities of a series pursuant to this Section, the Company shall be deemed to
have been discharged from its obligations with respect to the Outstanding
Securities of such series on the date the conditions set forth in Section 1304
are satisfied (hereinafter, "defeasance"). For this purpose, such defeasance
means that the Company shall be deemed to have paid and discharged the entire
indebtedness represented by the Outstanding Securities of such series and to
have satisfied all its other obligations under such Securities and this
Indenture insofar as such Securities are concerned (and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging the
same), except for the following which shall survive until otherwise terminated
or discharged hereunder: (A) the rights of Holders of Outstanding Securities of
such series to receive, solely from the trust fund described in Section 1304 and
as more fully set forth in such Section, payments in respect of the principal of
(and premium, if any) and interest on such Securities when such payments are
due, (B) the Company's obligations with respect to such Securities under
Sections 304, 305, 306, 1002 and 1003, (C) the rights, powers, trusts, duties,
and immunities of the Trustee hereunder and (D) this Article Thirteen. Subject
to compliance with this Article Thirteen, the Company may exercise its option
under this Section 1302 notwithstanding the prior exercise of its option under
Section 1303 with respect to the Securities of such series.
Section 1303. Covenant Defeasance.
-------------------
Upon the Company's election to effect a covenant defeasance with
respect to the Securities of a series pursuant to this Section, the Company
shall be released from its obligations under Sections 1006, 1007 and 1008, and
Section 501(4) (with respect to Sections 1006, 1007 and 1008) and Section 501(5)
shall be deemed not to be an Event of Default, with respect to the Outstanding
Securities of such series on and after the date the conditions set forth in
Section 1304 are satisfied (hereinafter, "covenant defeasance"). For this
purpose, such covenant defeasance means that, with respect to the Outstanding
Securities of such series, the Company may omit to comply with and shall
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<PAGE>
have no liability in respect of any term, condition or limitation set forth in
any such Section, whether directly or indirectly by reason of any reference
elsewhere herein to any such Section or by reason of any reference in any such
Section to any other provision herein or in any other document, but the
remainder of this Indenture and such Securities shall be unaffected thereby.
Section 1304. Conditions to Defeasance or Covenant Defeasance.
-----------------------------------------------
The following shall be the conditions to effecting a defeasance with
respect to the Securities of a series pursuant to Section 1302 or effecting a
covenant defeasance with respect to the Securities of a series pursuant to
Section 1303:
(1) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 609 who shall agree to comply with the provisions of this
Article Thirteen applicable to it) 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, (A)
money in an amount, or (B) U.S. Government Obligations which through the
scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than one day before the
due date of any payment, money in an amount, or (C) a combination thereof,
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, and which shall be applied by the
Trustee (or other qualifying trustee) to pay and discharge, (i) the
principal of (and premium, if any, on) and each instalment of principal of
(and premium, if any) and interest on the Outstanding Securities of such
series on the Stated Maturity of such principal or instalment of principal
or interest and (ii) any mandatory sinking fund payments or analogous
payments applicable to the Outstanding Securities of such series on the day
on which such payments are due and payable in accordance with the terms of
this Indenture and of such Securities. For this purpose, "U.S. Government
Obligations" means securities that are (x) direct obligations of the United
States of America for the payment of which its full faith and credit is
pledged or (y) obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the
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<PAGE>
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, in either case, are not callable or redeemable at the option of the
issuer thereof.
(2) No Event of Default or event which with notice or lapse of time or
both would become an Event of Default with respect to the Securities of
such series shall have occurred and be continuing on the date of such
deposit or, insofar as subsections 501(6) and (7) are concerned, at any
time during the period ending on the 123rd day after the date of such
deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period).
(3) Such defeasance or covenant defeasance shall not cause the Trustee
for the Securities of such series to have a conflicting interest as defined
in Section 608 and for purposes of the Trust Indenture Act with respect to
any securities of the Company.
(4) Such defeasance or covenant defeasance shall 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.
(5) Such defeasance or covenant defeasance shall not cause any
Securities of such series then listed on any registered national securities
exchange under the Securities Exchange Act of 1934, as amended, to be
delisted.
(6) In the case of an election under Section 1302, the Company shall
have delivered to the Trustee an opinion of nationally recognized tax
counsel stating that (x) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (y) since the date
of this Indenture there has been a change in the applicable Federal income
tax law, in either case to the effect that, and based thereon such opinion
shall confirm that, the Holders of the Outstanding Securities of such
series will not recognize income, gain or loss for Federal income tax
purposes as a result of such defeasance and will be subject to Federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such defeasance had not occurred.
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<PAGE>
(7) In the case of an election under Section 1303, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of the Outstanding Securities of such series will not recognize
income, gain or loss for Federal income tax purposes as a result of such
covenant defeasance and will be subject to Federal income tax on the same
amounts, in the same manner and at the same times as would have been the
case if such covenant defeasance had not occurred.
(8) Such defeasance or covenant defeasance shall be effected in
compliance with any additional terms, conditions or limitations which may
be imposed on the Company in connection therewith pursuant to Section 301.
(9) 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 either the defeasance under Section 1302
or the covenant defeasance under Section 1303 (as the case may be) have
been complied with.
Section 1305. Deposited Money and U.S. Government Obligations to be Held in
-------------------------------------------------------------
Trust; Other Miscellaneous Provisions.
-------------------------------------
Subject to the provisions of the last paragraph of Section 1003, all
money and U.S. Government Obligations (including the proceeds thereof) deposited
with the Trustee or other qualifying trustee (collectively, for purposes of this
Section 1305 and Section 1306, the "Trustee") pursuant to Section 1304 in
respect of the Outstanding Securities of a series shall be held in trust and
applied by the Trustee, in accordance with the provisions of such 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 Holders of such Securities, of all sums due and to become due
thereon in respect of principal (and premium, if any) and interest, but such
money need not be segregated from other funds except to the extent required by
law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 1304 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of the Outstanding Securities of such series.
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Anything in this Article Thirteen to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 1304 with respect to any Securities which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, are in excess of the
amount thereof which would then be required to be deposited to effect an
equivalent defeasance or covenant defeasance, as the case may be, with respect
to such Securities.
Section 1306. Reinstatement.
-------------
If the Trustee or the Paying Agent is unable to apply any money in
accordance with this Article with respect to any Securities by reason of any
order or judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, then the obligations under this
Indenture and such Securities from which the Company has been discharged or
released pursuant to Section 1302 or 1302 shall be revived and reinstated as
though no deposit had occurred pursuant to this Article with respect and
reinstated as though no deposit had occurred pursuant to this Article with
respect to such Securities, until such time as the Trustee or Paying Agent is
permitted to apply all money held in trust pursuant to Section 1305 with respect
to such Securities in accordance with this Article; provided, however, that if
the Company makes any payment of principal of or any premium or interest on any
such Security following such reinstatement of its obligations, the Company shall
be subrogated to the rights (if any) of the Holders of such Securities to
receive such payment from the money so held in trust.
-------------------
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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<PAGE>
In Witness Whereof, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
ALCO STANDARD CORPORATION
By
...........................
Name:
Title:
Attest:
...........................
Title
FIRST FIDELITY BANK, N.A.
By
...........................
Name:
Title:
Attest:
...........................
Title
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<PAGE>
COMMONWEALTH OF PENNSYLVANIA )
) SS.:
COUNTY OF CHESTER )
On the __th day of ___________, 199_, before me personally came
__________________, to me known, who, being by me duly sworn, did depose and say
that he is ________________________ of Alco Standard Corporation, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation; and that he signed his name thereto by like
authority.
...........................
Notary Public
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the __th day of _______________, 199_, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is _____________________ of First Fidelity Bank, N.A., one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation; and that he signed his name thereto by like
authority.
...........................
Notary Public
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<PAGE>
Exhibit 4.6
- ------------------------------------------------------------------------------
ALCO STANDARD CORPORATION
AND
---------------------------------
as Purchase Contract Agent
-----------------
PURCHASE CONTRACT AGREEMENT
-----------------
Dated as of ____________, 199_
<PAGE>
TABLE OF CONTENTS
Page
----
PARTIES..................................................................... 1
RECITALS.................................................................... 1
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.................................................. 1
Act ............................................................... 2
Affiliate ......................................................... 2
Agent ............................................................. 2
Agreement ......................................................... 2
Applicable Market Value ........................................... 2
Board of Directors ................................................ 2
Board Resolution .................................................. 2
Business Day ...................................................... 2
Closing Price ..................................................... 2
Collateral Agent .................................................. 2
Common Stock ...................................................... 3
Company ........................................................... 3
Contract Fee ...................................................... 3
Corporate Trust Office ............................................ 3
Current Market Price .............................................. 3
Depositary ........................................................ 3
Early Settlement .................................................. 3
Early Settlement Amount ........................................... 3
Early Settlement Date ............................................. 3
Early Settlement Rate ............................................. 3
Exchange Act ...................................................... 3
Excess Treasury Notes ............................................. 3
Expiration Date ................................................... 4
Expiration Time ................................................... 4
Final Settlement Date ............................................. 4
Final Settlement Fund ............................................. 4
Global Security Certificate ....................................... 4
Holder ............................................................ 4
Issuer Order ...................................................... 4
Issuer Request .................................................... 4
NYSE .............................................................. 4
Officers' Certificate ............................................. 4
Opinion of Counsel ................................................ 4
Outstanding Securities ............................................ 4
Outstanding Security Certificates ................................. 5
-i-
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<TABLE>
<CAPTION>
Page
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<S> <C> <C>
Payment Date ...................................................... 5
Person ............................................................ 5
Pledge ............................................................ 6
Pledge Agreement .................................................. 6
Predecessor Security Certificate .................................. 6
Purchase Contract ................................................. 6
Purchased Shares .................................................. 6
Record Date ....................................................... 6
Reorganization Event .............................................. 6
Responsible Officer ............................................... 6
Security .......................................................... 6
Security Certificate .............................................. 7
Security Register ................................................. 7
Security Registrar ................................................ 7
Settlement Rate ................................................... 7
Stated Amount ..................................................... 7
Termination Date .................................................. 7
Termination Event ................................................. 7
Threshold Appreciation Price ...................................... 7
TIA ............................................................... 8
Trading Day ....................................................... 8
Treasury Notes .................................................... 8
Underwriting Agreement ............................................ 8
Vice President .................................................... 8
Section 102. Compliance Certificates and Opinions ...................... 8
Section 103. Form of Documents Delivered to Agent ...................... 9
Section 104. Acts of Holders; Record Dates ............................. 9
Section 105. Notices, etc., to Agent and the Company ................... 11
Section 106. Notice to Holders; Waiver ................................. 12
Section 107. Effect of Headings and Table of Contents .................. 12
Section 108. Successors and Assigns .................................... 13
Section 109. Separability Clause ....................................... 13
Section 110. Benefits of Agreement ..................................... 13
Section 111. Governing Law ............................................. 13
Section 112. Legal Holidays ............................................ 13
Section 113. Counterparts .............................................. 14
Section 114. Inspection of Agreement ................................... 14
ARTICLE TWO
Security Certificate Forms
Section 201. Forms of Security Certificates Generally .................. 14
Section 202. Form of Agent's Certificate of Authentication ............. 15
</TABLE>
-ii-
<PAGE>
<TABLE>
<CAPTION>
Page
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<S> <C> <C>
ARTICLE THREE
The Securities
Section 301. Title and Terms; Denominations ............................................. 15
Section 302. Rights and Obligations Evidenced by the Security Certificates .............. 15
Section 303. Execution, Authentication, Delivery and Dating ............................. 16
Section 304. Temporary Security Certificates............................................. 17
Section 305. Registration; Registration of Transfer and Exchange......................... 17
Section 306. Mutilated, Destroyed, Lost and Stolen Security Certificates................. 20
Section 307. Persons Deemed Owners....................................................... 21
Section 308. Cancellation................................................................ 22
Section 309. Securities Not Separable.................................................... 22
</TABLE>
ARTICLE FOUR
The Treasury Notes
<TABLE>
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Section 401. Payment of Interest; Interest Rights Preserved.............................. 23
Section 402. Transfer of Treasury Notes Upon Occurrence of Termination Event............. 24
</TABLE>
ARTICLE FIVE
The Purchase Contracts
<TABLE>
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Section 501. Purchase of Shares of Common Stock.......................................... 25
Section 502. Contract Fees............................................................... 27
Section 503. Deferral of Payment Dates For Contract Fee.................................. 27
Section 504. Payment of Purchase Price................................................... 28
Section 505. Issuance of Shares of Common Stock.......................................... 28
Section 506. Adjustment of Settlement Rate............................................... 29
Section 507. Notice of Adjustments and Certain Other Events.............................. 36
Section 508. Termination Event; Notice................................................... 36
Section 509. Early Settlement............................................................ 37
Section 510. No Fractional Shares........................................................ 39
Section 511. Charges and Taxes........................................................... 39
</TABLE>
ARTICLE SIX
Remedies
<TABLE>
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Section 601. Unconditional Right of Holders to Receive Contract Fee...................... 40
Section 602. Restoration of Rights and Remedies.......................................... 40
Section 603. Rights and Remedies Cumulative.............................................. 40
</TABLE>
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<TABLE>
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Section 604. Delay or Omission Not Waiver.................................................. 41
Section 605. Undertaking for Costs......................................................... 41
Section 606. Waiver of Stay or Extension Laws.............................................. 41
</TABLE>
ARTICLE SEVEN
The Agent
<TABLE>
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Section 701. Certain Duties and Responsibilities........................................... 42
Section 702. Notice of Default............................................................. 43
Section 703. Certain Rights of Agent....................................................... 43
Section 704. Not Responsible for Recitals or Issuance of Securities........................ 44
Section 705. May Hold Securities........................................................... 44
Section 706. Money Held in Trust........................................................... 44
Section 707. Compensation and Reimbursement................................................ 45
Section 708. Corporate Agent Required; Eligibility......................................... 45
Section 709. Resignation and Removal; Appointment of Successor............................. 46
Section 710. Acceptance of Appointment by Successor........................................ 47
Section 711. Merger, Conversion, Consolidation or Succession to Business................... 48
Section 712. Preservation of Information; Communications to Holders........................ 48
Section 713. No Obligations of Agent....................................................... 49
Section 714. Tax Compliance................................................................ 49
</TABLE>
ARTICLE EIGHT
Supplemental Agreements
<TABLE>
<CAPTION>
<S> <C> <C>
Section 801. Supplemental Agreements Without Consent of Holders............................ 50
Section 802. Supplemental Agreements with Consent of Holders............................... 50
Section 803. Execution of Supplemental Agreements.......................................... 51
Section 804. Effect of Supplemental Agreements............................................. 52
Section 805. Reference to Supplemental Agreements.......................................... 52
</TABLE>
ARTICLE NINE
Consolidation, Merger, Sale or Conveyance
<TABLE>
<CAPTION>
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Section 901. Covenant Not to Merge, Consolidate, Sell or Convey Property Except
Under Certain Conditions...................................................... 52
Section 902. Rights and Duties of Successor Corporation.................................... 53
Section 903. Opinion of Counsel to Agent................................................... 53
</TABLE>
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<PAGE>
ARTICLE TEN
Covenants
<TABLE>
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Section 1001. Performance Under Purchase Contracts.......................................... 54
Section 1002. Maintenance of Office or Agency............................................... 54
Section 1003. Company to Reserve Common Stock............................................... 55
Section 1004. Covenants as to Common Stock.................................................. 55
Section 1005. Statements of Officers of the Company as to Default........................... 55
TESTIMONIUM.................................................................................. 56
SIGNATURES................................................................................... 56
</TABLE>
EXHIBIT A Form of Security Certificate
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<PAGE>
PURCHASE CONTRACT AGREEMENT, dated as of __________, 199_, between
ALCO STANDARD CORPORATION, an Ohio corporation (the "Company"), and
_______________________, acting as purchase contract agent for the Holders of
Securities from time to time (the "Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Security Certificates evidencing the Securities.
All things necessary to make the Company's obligations under the
Securities, when the Security Certificates are executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the Agent, as
in this Agreement provided, the valid obligations of the Company, and to
constitute these presents a valid agreement of the Company, in accordance with
its terms, have been done.
WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
-----------
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular; and
(2) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision.
"Act" when used with respect to any Holder, has the meaning specified
in Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or
<PAGE>
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Agent" means the Person named as the "Agent" in the first paragraph
of this instrument until a successor Agent shall have become such pursuant to
the applicable provisions of this Agreement, and thereafter "Agent" shall mean
the Person who is then the Agent hereunder.
"Agreement" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Applicable Market Value" has the meaning specified in Section 501.
"Board of Directors" means the board of directors of the Company or a
duly authorized committee of that board.
"Board Resolution" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certification and delivered
to the Agent.
"Business Day" means any day that is not a Saturday, Sunday or a day
on which the NYSE or banking institutions or trust companies in The City of New
York are authorized or obligated by law or executive order to be closed.
"Closing Price" has the meaning specified in Section 501.
"Collateral Agent" means ___________________________________, as
Collateral Agent under the Pledge Agreement until a successor Collateral Agent
shall have become such pursuant to the applicable provisions of the Pledge
Agreement, and thereafter "Collateral Agent" shall mean the Person who is then
the Collateral Agent thereunder.
"Common Stock" means the Common Stock, par value $.01 per share, of
the Company.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such, and
thereafter "Company" shall mean such successor.
"Contract Fee" means the fee payable by the Company in respect of each
Purchase Contract, equal to ___% per annum of the Stated Amount, accruing from
__________, 199 , computed on the basis of the actual number of days elapsed in
a year of 365 or 366 days, as the case may be, plus any additional fees accrued
pursuant to Section 503.
"Corporate Trust Office" means the principal office of the Agent in
the Borough of Manhattan, The City of New York, at which at any particular time
its corporate
-2-
<PAGE>
trust business shall be administered, which office at the date hereof is located
at __________________, New York, New York _____.
"Current Market Price" has the meaning specified in Section 506(a)(8).
"Depositary" means a clearing agency registered under the Exchange Act
that is designated to act as Depositary for the Securities as contemplated by
Section 305.
"Early Settlement" has the meaning specified in Section 509(a).
"Early Settlement Amount" has the meaning specified in Section 509(a).
"Early Settlement Date" has the meaning specified in Section 509(a).
"Early Settlement Rate" has the meaning specified in Section 509(b).
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"Excess Treasury Notes" has the meaning specified in Section 402.
"Expiration Date" has the meaning specified in Section 104.
"Expiration Time" has the meaning specified in Section 506(a)(6).
"Final Settlement Date" means __________, 1998.
"Final Settlement Fund" has the meaning specified in Section 505.
"Global Security Certificate" means a Security Certificate that
evidences all or part of the Securities and is registered in the name of a
Depositary or a nominee thereof.
"Holder," when used with respect to a Security Certificate (or a
Security), means a Person in whose name the Security evidenced by such Security
Certificate (or the Security Certificate evidencing such Security) is registered
in the Security Register.
"Issuer Order" or "Issuer Request" means a written order or request
signed in the name of the Company by its Chairman of the Board, any Vice
Chairman, its President or a Vice President and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the Agent.
"NYSE" has the meaning specified in Section 501.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, any Vice Chairman, the President or any Vice President and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
the Company and delivered to the Agent.
-3-
<PAGE>
"Opinion of Counsel" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company.
"Outstanding Securities" means, as of the date of determination, all
Securities evidenced by then Outstanding Security Certificates, except:
(i) If a Termination Event has occurred, Securities for which the
underlying Treasury Notes have been theretofore deposited with the Agent in
trust for the Holders of such Securities; and
(ii) On and after the applicable Early Settlement Date, Securities as
to which the Holder has elected to effect Early Termination of the related
Purchase Contracts;
provided, however, that in determining whether the Holders of the requisite
- -------- -------
number of Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Securities owned by the Company or any
Affiliate of the Company shall be disregarded and deemed not to be outstanding,
except that, in determining whether the Agent shall be protected in relying upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Securities which the Agent knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith may be regarded as
outstanding if the pledgee establishes to the satisfaction of the Agent the
pledgee's right so to act with respect to such Securities and that the pledgee
is not the Company or any Affiliate of the Company.
"Outstanding Security Certificates" means, as of the date of determination,
all Security Certificates theretofore authenticated, executed and delivered
under this Agreement, except:
(i) Security Certificates theretofore cancelled by the Agent or
delivered to the Agent for cancellation; and
(ii) Security Certificates in exchange for or in lieu of which
other Security Certificates have been authenticated, executed on behalf of
the Holder and delivered pursuant to this Agreement, other than any such
Security Certificate in respect of which there shall have been presented to
the Agent proof satisfactory to it that such Security Certificate is held
by a bona fide purchaser in whose hands the Securities evidenced by such
Security Certificate are valid obligations of the Company.
"Payment Date" means each __________ and __________, commencing
__________, 199 .
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pledge" means the pledge under the Pledge Agreement of the
Treasury Notes constituting a part of the Securities.
-4-
<PAGE>
"Pledge Agreement" means the Pledge Agreement, dated as of the date
hereof, among the Company, the Collateral Agent and the Agent, on its own behalf
and as attorney-in-fact for the Holders from time to time of the Securities.
"Predecessor Security Certificate" of any particular Security
Certificate means every previous Security Certificate evidencing all or a
portion of the rights and obligations of the Holder under the Securities
evidenced thereby; and, for the purposes of this definition, any Security
Certificate authenticated and delivered under Section 306 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security Certificate shall be
deemed to evidence the same rights and obligations of the Holder as the
mutilated, destroyed, lost or stolen Security Certificate.
"Purchase Contract," when used with respect to any Security, means the
contract obligating the Company to sell and the Holder of such Security to
purchase Common Stock on the terms and subject to the conditions set forth in
Article Five hereof.
"Purchased Shares" has the meaning specified in Section 506(a)(6).
"Record Date" for the interest and Contract Fees payable on any
Payment Date means the ______ or _______ (whether or not a Business Day), as the
case may be, next preceding such Payment Date.
"Reorganization Event" has the meaning specified in Section 506(b).
"Responsible Officer," when used with respect to the Agent, means any
officer of the Agent assigned by the Agent to administer its corporate trust
matters.
"Security" means the collective rights and obligations of a Holder of
a Security Certificate in respect of Treasury Notes with a principal amount
equal to the Stated Amount, subject to the Pledge thereof, and a Purchase
Contract.
"Security Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Securities specified on such
certificate.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Settlement Rate" has the meaning specified in Section 501.
"Stated Amount" means $____________.
"Termination Date" means the date, if any, on which a Termination
Event occurs.
"Termination Event" means the occurrence of any of the following
events: (i) at any time on or prior to the Final Settlement Date, a decree or
order by a court having jurisdiction in the premises shall have been entered
adjudging the Company a bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization of the Company
-5-
<PAGE>
under the United States Bankruptcy Code or any other similar applicable Federal
or State law, and, unless such decree or order shall have been entered within 60
days prior to the Final Settlement Date, such decree or order shall have
continued undischarged and unstayed for a period of 60 days; or (ii) a decree or
order of a court having jurisdiction in the premises for the appointment of a
receiver or liquidator or trustee or assignee in bankruptcy or insolvency of the
Company or of its property, or for the winding up or liquidation of its affairs,
shall have been entered, and, unless such decree or order shall have been
entered within 60 days prior to the Final Settlement Date, such decree or order
shall have continued undischarged and unstayed for a period of 60 days, or (iii)
at any time on or prior to the Final Settlement Date the Company shall institute
proceedings to be adjudicated a bankrupt, or shall consent to the filing of a
bankruptcy proceeding against it, or shall file a petition or answer or consent
seeking reorganization under the United States Bankruptcy Code or any other
similar applicable Federal or State law, or shall consent to the filing of any
such petition, or shall consent to the appointment of a receiver or liquidator
or trustee or assignee in bankruptcy or insolvency of it or of its property, or
shall make an assignment for the benefit of creditors, or shall admit in writing
its inability to pay its debts generally as they become due.
"Threshold Appreciation Price" has the meaning specified in Section
501.
"TIA" means the Trust Indenture Act of 1939, as amended, or any
successor statute.
"Trading Day" has the meaning specified in Section 501.
"Treasury Notes" means _____% United States Government Notes due
__________, 199 .
"Underwriting Agreement" means the Underwriting Agreement dated
__________, 199 between the Company and _____________________________, as
representatives of the several Underwriters named therein.
"Vice President" means any vice president, whether or not designated
by a number or a word or words added before or after the title "vice president."
Section 102. Compliance Certificates and Opinions.
------------------------------------
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Agent to take any action under any
provision of this Agreement, the Company shall furnish to the Agent an Officers'
Certificate stating that all conditions precedent, if any, provided for in this
Agreement relating to the proposed action have been complied with and an Opinion
of Counsel stating that, in the opinion of such counsel, all such conditions
precedent, if any, have been complied with, except that in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Agreement relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement shall include:
-6-
<PAGE>
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Agent.
------------------------------------
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
Section 104. Acts of Holders; Record Dates.
-----------------------------
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Agent and, where it is hereby expressly required, to the Company. Such
-7-
<PAGE>
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Agreement and (subject to Section 701) conclusive in favor of the Agent and the
Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Agent deems sufficient.
(c) The ownership of Securities shall be proved by the Security
Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security Certificate evidencing
such Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Agent or the Company in reliance thereon, whether or not notation
of such action is made upon such Security Certificate.
(e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give, make or take
any request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders of Securities. If any record date is set pursuant to this paragraph,
the Holders of Outstanding Securities on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date; provided that no such action shall be
--------
effective hereunder unless taken on or prior to the applicable Expiration Date
by Holders of the requisite number of Outstanding Securities on such record
date. Nothing in this paragraph shall be construed to prevent the Company from
setting a new record date for any action for which a record date has previously
been set pursuant to this paragraph (whereupon the record date previously set
shall automatically and with no action by any Person be cancelled and of no
effect), and nothing in this paragraph shall be construed to render ineffective
any action taken by Holders of the requisite number of Outstanding Securities on
the date such action is taken. Promptly after any record date is set pursuant
to this paragraph, the Company, at its own expense, shall cause notice of such
record date, the proposed action by Holders and the applicable Expiration Date
to be given to the Agent in writing and to each Holder of Securities in the
manner set forth in Section 106.
With respect to any record date set pursuant to this Section, the
Company may designate any date as the "Expiration Date" and from time to time
may change the Expiration Date to any earlier or later day; provided that no
--------
such change shall be effective unless notice
-8-
<PAGE>
of the proposed new Expiration Date is given to the Agent in writing, and to
each Holder of Securities in the manner set forth in Section 106, on or prior to
the existing Expiration Date. If an Expiration Date is not designated with
respect to any record date set pursuant to this Section, the Company shall be
deemed to have initially designated the 180th day after such record date as the
Expiration Date with respect thereto, subject to its right to change the
Expiration Date as provided in this paragraph. Notwithstanding the foregoing,
no Expiration Date shall be later than the 180th day after the applicable record
date.
Section 105. Notices, etc., to Agent and the Company.
---------------------------------------
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Agreement to
be made upon, given or furnished to, or filed with,
(1) the Agent by any Holder or by the Company shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally delivered or
mailed, first-class postage prepaid, to the Agent at ____________________,
Attention: Stock Transfer Department, or at any other address previously
furnished in writing by the Agent to the Holders and the Company, or
(2) The Company by the Agent or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally delivered or
mailed, first-class postage prepaid, to the Company at Alco Standard
Corporation, P.O. Box 834, Valley Forge, Pennsylvania 19482, Attention:
Treasurer, or at any other address previously furnished in writing to the
Agent by the Company.
Section 106. Notice to Holders; Waiver.
-------------------------
Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Agent, but such filing shall not be a condition precedent to the validity of any
action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as
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<PAGE>
shall be made with the approval of the Agent shall constitute a sufficient
notification for every purpose hereunder.
Section 107. Effect of Headings and Table of Contents.
----------------------------------------
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 108. Successors and Assigns.
----------------------
All covenants and agreements in this Agreement by the Company shall
bind its successors and assigns, whether so expressed or not.
Section 109. Separability Clause.
-------------------
In case any provision in this Agreement or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
Section 110. Benefits of Agreement.
---------------------
Nothing in this Agreement or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and the Holders, any benefits or any legal or equitable right, remedy
or claim under this Agreement. The Holders from time to time shall be
beneficiaries of this Agreement and shall be bound by all of the terms and
conditions hereof and of the Securities evidenced by their Security Certificates
by their acceptance of delivery thereof.
Section 111. Governing Law.
-------------
This Agreement and the Securities shall be governed by and construed
in accordance with the laws of the State of New York.
Section 112. Legal Holidays.
--------------
In any case where any Payment Date, any Early Settlement Date or the
Final Settlement Date shall not be a Business Day, then (notwithstanding any
other provision of this Agreement or of the Securities) payment in respect of
interest on Treasury Notes or Contract Fees shall not be made, Purchase
Contracts shall not be performed and Early Settlement shall not be effected on
such date, but such payments shall be made, or the Purchase Contracts shall be
performed or Early Settlement effected, as applicable, on the next succeeding
Business Day with the same force and effect as if made on such Payment Date,
Early Settlement Date or Final Settlement Date, as the case may be; provided,
--------
that no interest shall accrue or be payable by the Company or any Holder for the
period from and after any such Payment Date, Early Settlement Date or Final
Settlement Date, as the case may be.
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<PAGE>
Section 113. Counterparts.
------------
This Agreement may be executed in any number of counterparts, each of
which, when so executed, shall be deemed an original, but all such counterparts
shall together constitute one and the same instrument.
Section 114. Inspection of Agreement.
-----------------------
A copy of this Agreement shall be available at all reasonable times at
the Corporate Trust Office for inspection by any Holder.
ARTICLE TWO
Security Certificate Forms
Section 201. Forms of Security Certificates Generally.
----------------------------------------
The Security Certificates (including the form of Purchase Contracts
forming part of the Securities evidenced thereby) shall be in substantially the
form set forth in Exhibit A hereto, with such letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Securities are listed or Depositary therefor,
or as may, consistently herewith, be determined by the officers of the Company
executing such Security Certificates, as evidenced by their execution of the
Security Certificates.
The definitive Security Certificates shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers of the Company executing the Security
Certificates, consistent with the provisions of this Agreement, as evidenced by
their execution thereof.
Every Global Security Certificate authenticated, executed on behalf of
the Holders and delivered hereunder shall bear a legend in substantially the
following form:
THIS SECURITY CERTIFICATE IS A GLOBAL SECURITY CERTIFICATE WITHIN THE
MEANING OF THE PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY
CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY
CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS SECURITY CERTIFICATE IN
WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN
SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
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<PAGE>
Section 202. Form of Agent's Certificate of Authentication.
---------------------------------------------
The form of the Agent's certificate of authentication of the
Securities shall be in substantially the form set forth on the form of the
Security Certificates.
ARTICLE THREE
The Securities
Section 301. Title and Terms; Denominations.
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The aggregate number of Securities evidenced by Security Certificates
authenticated, executed on behalf of the Holders and delivered hereunder is
limited to _____________ (subject to increase up to a maximum of ___________ to
the extent the over-allotment option of the underwriters under the Underwriting
Agreement is exercised), except for Security Certificates authenticated,
executed and delivered upon registration of transfer of, in exchange for, or in
lieu of, other Security Certificates pursuant to Section 304, 305, 306, 509 or
805.
The Security Certificates shall be issuable only in registered form
and only in denominations of a single Security and any integral multiple
thereof.
Section 302. Rights and Obligations Evidenced by the Security Certificates.
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Each Security Certificate shall evidence the number of Securities
specified therein, with each such Security representing the ownership by the
Holder thereof of Treasury Notes with a principal amount equal to the Stated
Amount, subject to the Pledge of such Treasury Notes by such Holder pursuant to
the Pledge Agreement, and the rights and obligations of the Holder under one
Purchase Contract. Prior to the purchase, if any, of shares of Common Stock
under the Purchase Contracts, the Securities shall not entitle the Holders to
any of the rights of a holder of shares of Common Stock, including, without
limitation, the right to vote or receive any dividends or other payments or to
consent or to receive notice as stockholders in respect of the meetings of
stockholders or for the election of directors of the Company or for any other
matter, or any other rights whatsoever as stockholders of the Company, except to
the extent otherwise expressly provided in this Agreement.
Section 303. Execution, Authentication, Delivery and Dating.
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Upon the execution and delivery of this Agreement, and at any time and
from time to time thereafter, the Company may deliver Security Certificates
executed by the Company to the Agent for authentication, execution on behalf of
the Holders and delivery, together with its Issuer Order for authentication of
such Security Certificates, and the Agent in accordance with such Issuer Order
shall authenticate, execute on behalf of the Holder and deliver such Security
Certificates.
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The Security Certificates shall be executed on behalf of the Company
by its Chairman of the Board, its Vice Chairman of the Board, its President or
one of its Vice Presidents, under its corporate seal reproduced thereon attested
by its Secretary or one of its Assistant Secretaries. The signature of any of
these officers on the Security Certificates may be manual or facsimile.
Security Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Security
Certificates or did not hold such offices at the date of such Security
Certificates.
No Purchase Contract underlying a Security evidenced by a Security
Certificate shall be valid until such Security Certificate has been executed on
behalf of the Holder by the manual signature of an authorized signatory of the
Agent, as such Holder's attorney-in-fact. Such signature by an authorized
signatory of the Agent shall be conclusive evidence that the Holder of such
Security Certificate has entered into the Purchase Contracts underlying the
Securities evidenced by such Security Certificate.
Each Security Certificate shall be dated the date of its
authentication.
No Security Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose unless there appears on such
Security Certificate a certificate of authentication substantially in the form
provided for herein executed by an authorized signatory of the Agent by manual
signature, and such certificate upon any Security Certificate shall be
conclusive evidence, and the only evidence, that such Security Certificate has
been duly authenticated and delivered hereunder.
Section 304. Temporary Security Certificates.
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Pending the preparation of definitive Security Certificates, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holders, and deliver, in lieu of such
definitive Security Certificates, temporary Security Certificates which are in
substantially the form set forth in Exhibit A hereto, with such letters, numbers
or other marks of identification or designation and such legends or endorsements
printed, lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Securities are listed, or as may, consistently
herewith, be determined by the officers of the Company executing such Security
Certificates, as evidenced by their execution of the Security Certificates.
If temporary Security Certificates are issued, the Company will cause
definitive Security Certificates to be prepared without unreasonable delay.
After the preparation of definitive Security Certificates, the temporary
Security Certificates shall be exchangeable for definitive Security Certificates
upon surrender of the temporary Security Certificates at the Corporate Trust
Office, at the expense of the Company and without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Security Certificates,
the Company shall execute and deliver to the Agent, and the Agent shall
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authenticate, execute on behalf of the Holder, and deliver in exchange therefor,
one or more definitive Security Certificates of authorized denominations and
evidencing a like number of Securities as the temporary Security Certificate or
Security Certificates so surrendered. Until so exchanged, the temporary
Security Certificates shall in all respects evidence the same benefits and the
same obligations with respect to the Securities evidenced thereby as definitive
Security Certificates.
Section 305. Registration; Registration of Transfer and Exchange.
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The Agent shall keep at the Corporate Trust Office a register (the
register maintained in such office being herein referred to as the "Security
Register") in which, subject to such reasonable regulations as it may prescribe,
the Agent shall provide for the registration of Security Certificates and of
transfers of Security Certificates (the Agent, in such capacity, the "Security
Registrar").
Upon surrender for registration of transfer of any Security
Certificate at the Corporate Trust Office, the Company shall execute and deliver
to the Agent, and the Agent shall authenticate, execute on behalf of the
designated transferee or transferees, and deliver, in the name of the designated
transferee or transferees, one or more new Security Certificates of any
authorized denominations and evidencing a like number of Securities.
At the option of the Holder, Security Certificates may be exchanged
for other Security Certificates, of any authorized denominations and evidencing
a like number of Securities, upon surrender of the Security Certificates to be
exchanged at the Corporate Trust Office. Whenever any Security Certificates are
so surrendered for exchange, the Company shall execute and deliver to the Agent,
and the Agent shall authenticate, execute on behalf of the Holder, and deliver
the Security Certificates which the Holder making the exchange is entitled to
receive.
All Security Certificates issued upon any registration of transfer or
exchange of a Security Certificate shall evidence the ownership of the same
number of Securities and be entitled to the same benefits and subject to the
same obligations, under this Agreement as the Securities evidenced by the
Security Certificate surrendered upon such registration of transfer or exchange.
Every Security Certificate presented or surrendered for registration
of transfer or for exchange shall (if so required by the Agent) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Agent duly executed, by the Holder thereof
or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of a Security Certificate, but the Company and the Agent may require
payment from the Holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Security Certificates, other than any exchanges pursuant
to Sections 306 and 805 not involving any transfer.
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Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder and deliver any Security
Certificate presented or surrendered for registration of transfer or for
exchange on or after the Final Settlement Date or the Termination Date. In lieu
of delivery of a new Security Certificate, upon satisfaction of the applicable
conditions specified above in this Section and receipt of appropriate
registration or transfer instructions from such Holder, the Agent shall (i) if
the Final Settlement Date has occurred, deliver the shares of Common Stock
issuable in respect of the Purchase Contracts forming a part of the Securities
evidenced by such Security Certificate, or (ii) if a Termination Event shall
have occurred prior to the Final Settlement Date, transfer the principal amount
of the Treasury Notes evidenced thereby, in each case subject to the applicable
conditions and in accordance with the applicable provisions of Article Five
hereof.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only
to Global Security Certificates:
(1) Each Global Security Certificate authenticated and executed on
behalf of the Holders under this Agreement shall be registered in the name
of the Depositary designated for such Global Security Certificate or a
nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Security Certificate shall
constitute a single Security Certificate for all purposes of this
Agreement.
(2) Notwithstanding any other provision in this Agreement, no Global
Security Certificate may be exchanged in whole or in part for Security
Certificates registered, and no transfer of a Global Security Certificate
in whole or in part may be registered, in the name of any Person other than
the Depositary for such Global Security Certificate or a nominee thereof
unless (A) such Depositary (i) has notified the Company that it is
unwilling or unable to continue as Depositary for such Global Security
Certificate or (ii) has ceased to be a clearing agency registered under the
Exchange Act or (b) there shall have occurred and be continuing a default
by the Company in respect to its obligations under one or more Purchase
Contracts.
(3) Subject to Clause (2) above, any exchange of a Global Security
Certificate for other Security Certificates may be made in whole or in
part, and all Security Certificates issued in exchange for a Global
Security Certificate or any portion thereof shall be registered in such
names as the Depositary for such Global Security Certificate shall direct.
(4) Every Security Certificate authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global
Security Certificate or any portion thereof, whether pursuant to this
Section, Section 304, 306, 509 or 805 or otherwise, shall be authenticated,
executed on behalf of the Holders and delivered in the form of, and shall
be, a Global Security Certificate, unless such Security Certificate is
registered in the name of a Person other than the Depositary for such
Global Security Certificate or a nominee thereof.
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Section 306. Mutilated, Destroyed, Lost and Stolen Security Certificates.
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If any mutilated Security Certificate is surrendered to the Agent, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange therefor,
a new Security Certificate, evidencing the same number of Securities and bearing
a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Agent (i) evidence
to their satisfaction of the destruction, loss or theft of any Security
Certificate, and (ii) such security or indemnity as may be required by them to
save each of them and any agent of any of them harmless, then, in the absence of
notice to the Company or the Agent that such Security Certificate has been
acquired by a bona fide purchaser, the Company shall execute and deliver to the
Agent, and the Agent shall authenticate, execute on behalf of the Holder, and
deliver to the Holder, in lieu of any such destroyed, lost or stolen Security
Certificate, a new Security Certificate, evidencing the same number of
Securities and bearing a number not contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder, and deliver to the Holder, a
Security Certificate on or after the Final Settlement Date or the Termination
Date. In lieu of delivery of a new Security Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt of
appropriate registration or transfer instructions from such Holder, the Agent
shall (i) if the Final Settlement Date has occurred, deliver the shares of
Common Stock issuable in respect of the Purchase Contracts forming a part of the
Securities evidenced by such Security Certificate, or (ii) if a Termination
Event shall have occurred prior to the Final Settlement Date, transfer the
principal amount of the Treasury Notes evidenced thereby, in each case subject
to the applicable conditions and in accordance with the applicable provisions of
Article Five hereof.
Upon the issuance of any new Security Certificate under this Section,
the Company and the Agent 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 Agent) connected
therewith.
Every new Security Certificate issued pursuant to this Section in lieu
of any destroyed, lost or stolen Security Certificate shall constitute an
original additional contractual obligation of the Company and of the Holder,
whether or not the destroyed, lost or stolen Security Certificate shall be at
any time enforceable by anyone, and shall be entitled to all the benefits and be
subject to all the obligations of this Agreement equally and proportionately
with any and all other Security Certificates delivered 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 settlement of mutilated, destroyed, lost or stolen Security Certificates.
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Section 307. Persons Deemed Owners.
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Prior to due presentment of a Security Certificate for registration of
transfer, the Company and the Agent, and any agent of the Company or the Agent,
may treat the Person in whose name such Security Certificate is registered as
the owner of the Securities evidenced thereby, for the purpose of receiving
payments of interest on the Treasury Notes, receiving payments of Contract
Fees, performance of the Purchase Contracts and for all other purposes
whatsoever, whether or not the payment of interest on the Treasury Notes or any
Contract Fee payable in respect of the Purchase Contracts constituting a part of
the Securities evidenced thereby shall be overdue and notwithstanding any notice
to the contrary, and neither the Company nor the Agent, nor any agent of the
Company or the Agent, shall be affected by notice to the contrary.
Notwithstanding the foregoing, with respect to any Global Security
Certificate, nothing herein shall prevent the Company, the Agent or any agent of
the Company or the Agent, from giving effect to any written certification, proxy
or other authorization furnished by any Depositary (or its nominee), as a
Holder, with respect to such Global Security Certificate or impair, as between
such Depositary and owners of beneficial interests in such Global Security
Certificate, the operation of customary practices governing the exercise of
rights of such Depositary (or its nominee) as Holder of such Global Security
Certificate.
Section 308. Cancellation.
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All Security Certificates surrendered for delivery of shares of Common
Stock on or after the Final Settlement Date, transfer of Treasury Notes after
the occurrence of a Termination Event or pursuant to an Early Settlement or
registration of transfer or exchange shall, if surrendered to any Person other
than the Agent, be delivered to the Agent and, if not already cancelled, shall
be promptly cancelled by it. The Company may at any time deliver to the Agent
for cancellation any Security Certificates previously authenticated, executed
and delivered hereunder which the Company may have acquired in any manner
whatsoever, and all Security Certificates so delivered shall, upon Issuer Order,
be promptly cancelled by the Agent. No Security Certificates shall be
authenticated, executed on behalf of the Holder and delivered in lieu of or in
exchange for any Security Certificates cancelled as provided in this Section,
except as expressly permitted by this Agreement. All cancelled Security
Certificates held by the Agent shall be disposed of as directed by Issuer Order.
If the Company or any Affiliate of the Company shall acquire any
Security Certificate, such acquisition shall not operate as a cancellation of
such Security Certificate unless and until such Security Certificate is
delivered to the Agent cancelled or for cancellation.
Section 309. Securities Not Separable.
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Notwithstanding anything contained herein or in the Security
Certificates to the contrary, for so long as the Purchase Contract underlying a
Security remains in effect such Security shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Security
in respect of the Treasury Notes and Purchase Contracts
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constituting such Security may be acquired, and may be transferred and
exchanged, only as a Security. Other than a Security Certificate evidencing a
Security, no Holder of a Security, or any transferee thereof, shall be entitled
to receive a certificate evidencing the ownership of Treasury Notes or the
rights and obligations of the Holder and the Company under a Purchase Contract
for so long as the Purchase Contract underlying the Security remains in effect.
ARTICLE FOUR
The Treasury Notes
Section 401. Payment of Interest; Interest Rights Preserved.
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Interest on any Treasury Note which is paid on any Payment Date shall,
subject to receipt thereof by the Agent from the Collateral Agent as provided by
the terms of the Pledge Agreement, be paid to the Person in whose name the
Security Certificate (or one or more Predecessor Security Certificates) of which
such Treasury Note is a part is registered at the close of business on the
Record Date next preceding such Payment Date.
Each Security Certificate evidencing Treasury Notes delivered under
this Agreement upon registration of transfer of or in exchange for or in lieu of
any other Security Certificate shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by the Treasury Notes underlying such
other Security Certificate.
In the case of any Security with respect to which Early Settlement of
the underlying Purchase Contract is effected on an Early Settlement Date after
any Record Date and on or prior to the next succeeding Payment Date, interest on
the Treasury Notes underlying such Security otherwise payable on such Payment
Date shall be payable on such Payment Date notwithstanding such Early
Settlement, and such interest shall, subject to receipt thereof by the Agent, be
paid to the Person in whose name the Security Certificate (or one or more
Predecessor Security Certificates) is registered at the close of business on the
Record Date. Except as otherwise expressly provided in the immediately
preceding sentence, in the case of any Security with respect to which Early
Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date, interest on the related Treasury Notes that would otherwise be
payable after the Early Settlement Date shall not be payable hereunder to the
Holder of such Security.
Section 402. Transfer of Treasury Notes Upon Occurrence of Termination Event.
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Upon the occurrence of a Termination Event and the transfer to the
Agent of the Treasury Notes underlying such Securities pursuant to the terms of
the Pledge Agreement, the Agent shall request transfer instructions with respect
to such Treasury Notes from each Holder of Securities by written request mailed
to such Holder at his address as it appears in the Security Register, in respect
of the Treasury Notes underlying the Security Certificate held by such Holder.
Upon surrender to the Agent of a Security Certificate with such transfer
instructions in proper form for transfer of the Treasury Notes by Federal
Reserve Bank-Wire or other appropriate procedure, the Agent shall transfer the
Treasury Notes evidenced by such
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Security Certificate to such Holder in accordance with such instructions. If a
Security Certificate is not duly surrendered to the Agent with appropriate
transfer instructions, the Agent shall hold the Treasury Notes evidenced by such
Security Certificate as custodian for the Holder of such Security Certificate.
Treasury Notes shall be transferred only in denominations of $1,000
and integral multiples thereof. As promptly as practicable following the
occurrence of a Termination Event, the Agent shall determine the excess of (i)
the aggregate principal amount of Treasury Notes underlying the Outstanding
Securities over (ii) the aggregate principal amount of Treasury Notes in
denominations of $1,000 and integral multiples thereof transferrable to Holders
of record on the date of such Termination Event (such excess being herein
referred to as the "Excess Treasury Notes"). As soon as practicable after
transfer to the Agent of the Treasury Notes underlying the Outstanding
Securities as provided in the Pledge Agreement, the Agent shall sell the Excess
Treasury Notes to or through one or more U.S. Government securities dealers at
then prevailing prices. The Agent shall deduct from the proceeds of such sales
all commissions and other out-of-pocket transaction costs incurred in connection
with such sales of Excess Treasury Notes and, until the net proceeds of such
sale or sales have been distributed to Holders of the Securities, the Agent
shall hold such proceeds in trust for the Holders of Securities. Each Holder
shall be entitled to receive a portion, if any, of such net proceeds in lieu of
Treasury Notes with a principal amount of less than $1,000 determined by
multiplying the aggregate amount of such net proceeds by a fraction, the
numerator of which is the fraction of $1,000 in principal amount of Treasury
Notes to which such Holder would otherwise be entitled (after taking into
account all Securities then held by such Holder) and the denominator of which is
the aggregate principal amount of Excess Treasury Notes.
ARTICLE FIVE
The Purchase Contracts
Section 501. Purchase of Shares of Common Stock.
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Each Purchase Contract shall obligate the Holder of the related
Security to purchase, and the Company to sell, on the Final Settlement Date at a
price equal to the Stated Amount, a number of shares of Common Stock equal to
the Settlement Rate, unless, on or prior to the Final Settlement Date, there
shall have occurred a Termination Event or an Early Settlement with respect to
the Security of which such Purchase Contract is a part. The "Settlement Rate"
is equal to (a) if the Applicable Market Value (as defined below) is greater
than $_____ (the "Threshold Appreciation Price"), _____ of a share of Common
Stock per Purchase Contract, (b) if the Applicable Market Value is less than or
equal to the Threshold Appreciation Price but is greater than the Stated Amount,
a fractional share of Common Stock per Purchase Contract equal to the Stated
Amount divided by the Applicable Market Value (rounded upward or downward to the
nearest 1/10,000th of a share) and (c) if the Applicable Market Value is less
than or equal to the Stated Amount, one share of Common Stock per Purchase
Contract, in each case subject to adjustment as provided in Section 506. As
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provided in Section 510, no fractional shares of Common Stock will be issued
upon settlement of Purchase Contracts.
The "Applicable Market Value" means the average of the Closing Prices
per share of Common Stock on each of the twenty consecutive Trading Days ending
on the last Trading Day immediately preceding the Final Settlement Date. The
"Closing Price" of the Common Stock on any date of determination means the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on the New York Stock Exchange (the "NYSE") on such
date or, if the Common Stock is not listed for trading on the NYSE on any such
date, as reported in the composite transactions for the principal United States
securities exchange on which the Common Stock is so listed, or if the Common
Stock is not so listed on a United States national or regional securities
exchange, as reported by The Nasdaq Stock Market, or, if the Common Stock is not
so reported, the last quoted bid price for the Common Stock in the over-the-
counter market as reported by the National Quotation Bureau or similar
organization, or, if such bid price is not available, the market value of the
Common Stock on such date as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company. A "Trading
Day" means a day on which the Common Stock (A) is not suspended from trading on
any national or regional securities exchange or association or over-the-counter
market at the close of business and (B) has traded at least once on the national
or regional securities exchange or association or over-the-counter market that
is the primary market for the trading of the Common Stock.
Each Holder of a Security Certificate evidencing Securities, by his
acceptance thereof, irrevocably authorizes the Agent to enter into and perform
the related Purchase Contracts on his behalf as his attorney-in-fact, agrees to
be bound by the terms and provisions thereof, covenants and agrees to perform
his obligations under such Purchase Contracts, consents to the provisions
hereof, irrevocably authorizes the Agent as his attorney-in-fact to enter into
and perform the Pledge Agreement on his behalf as his attorney-in-fact, and
consents to and agrees to be bound by the Pledge of the Treasury Notes
underlying such Security Certificate pursuant to the Pledge Agreement. Each
Holder of a Security, by his acceptance thereof, further irrevocably covenants
and agrees, that, to the extent and in the manner provided in Section 504 and
the Pledge Agreement, but subject to the terms thereof, payments in respect of
principal of the Treasury Notes on the Final Settlement Date shall be paid by
the Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Purchase Contract and such Holder shall acquire no right, title or
interest in such payments.
Upon registration of transfer of a Security Certificate evidencing
Purchase Contracts, the transferee shall be bound (without the necessity of any
other action on the part of such transferee), under the terms of this Agreement,
the Purchase Contracts evidenced thereby and the Pledge Agreement and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by the Security Certificates so transferred. The Company covenants
and agrees, and each Holder of a Security Certificate, by his acceptance
thereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
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Section 502. Contract Fees.
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Subject to Section 503, the Company shall pay, on each Payment Date,
the Contract Fees payable in respect of each Purchase Contract to the Person in
whose name the Security Certificate (or one or more Predecessor Security
Certificates) evidencing such Purchase Contract is registered at the close of
business on the Record Date next preceding such Payment Date. The Contract Fee
will be payable at the office of the Agent in The City of New York maintained
for that purpose or, at the option of the Company, by check mailed to the
address of the Person entitled thereto at such address as it appears on the
Security Register.
Each Security Certificate delivered under this Agreement upon
registration of transfer of or in exchange for or in lieu of any other Security
Certificate shall carry the rights to Contract Fees accrued and unpaid, and to
accrue, which were carried by the Purchase Contracts evidenced by such other
Security Certificate.
In the case of any Security with respect to which Early Settlement of
the underlying Purchase Contract is effected on an Early Settlement Date after
any Record Date and on or prior to the next succeeding Payment Date, Contract
Fees otherwise payable on such Payment Date shall be payable on such Payment
Date notwithstanding such Early Settlement, and such Contract Fees shall be paid
to the Person in whose name the Security Certificate evidencing such Security
(or one or more Predecessor Security Certificates) is registered at the close of
business on such Record Date. Except as otherwise expressly provided in the
immediately preceding sentence, in the case of any Security with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date, Contract Fees that would otherwise be payable after the
Early Settlement Date with respect to the Purchase Contract underlying such
Security shall not be payable.
Section 503. Deferral of Payment Dates For Contract Fee.
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The Company shall have the right, at any time prior to the Final
Settlement Date, to defer the payment of any or all of the Contract Fees
otherwise payable on any Payment Date, but only if the Company shall give the
Holders and the Agent written notice of its election to defer such payment
(specifying the amount to be deferred) at least ten Business Days prior to the
earlier of (i) the next succeeding Payment Date or (ii) the date the Company is
required to give notice of the Record or Payment Date with respect to payment of
such Contract Fee to the New York Stock Exchange or other applicable self-
regulatory organization or to Holders of the Securities, but in any event not
less than two Business Days prior to such Record Date. Any Contract Fees so
deferred shall bear additional Contract Fees thereon at the rate of _____ per
annum (computed on the basis of the actual number of days elapsed in a year of
365 or 366 days, as the case may be), compounding on each succeeding Payment
Date, until paid in full. Deferred Contract Fees (and additional Contract Fees
accrued thereon) shall be due on the next succeeding Payment Date except to the
extent that payment is deferred pursuant to this Section. No Contract Fees may
be deferred to a date that is after the Final Settlement Date or, with respect
to any particular Purchase Contract, Early Settlement thereof.
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Section 504. Payment of Purchase Price.
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The purchase price for the shares of Common Stock purchased pursuant
to a Purchase Contract shall be paid by application of payments received by the
Company on the Final Settlement Date from the Collateral Agent pursuant to the
Pledge Agreement in respect of the principal of the Treasury Notes Pledged to
secure the obligations of the relevant Holder under such Purchase Contract.
Such application shall satisfy in full the obligations under such Purchase
Contract of the Holder of the Security of which such Purchase Contract is a
part. The Company shall not be obligated to issue any shares of Common Stock in
respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate purchase
price for the shares of Common Stock to be purchased thereunder in the manner
herein set forth.
Section 505. Issuance of Shares of Common Stock.
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Unless a Termination Event shall have occurred on or prior to the
Final Settlement Date, on the Final Settlement Date, upon its receipt of payment
in full of the purchase price for the shares of Common Stock purchased by the
Holders pursuant to the foregoing provisions of this Article, and subject to
Section 506(b), the Company shall deposit with the Agent, for the benefit of the
Holders of the Outstanding Securities, one or more certificates representing the
shares of Common Stock registered in the name of the Agent (or its nominee) as
custodian for the Holders (such certificates for shares of Common Stock,
together with any dividends or distributions with respect thereto, being
hereinafter referred to as the "Final Settlement Fund") to which the Holders are
entitled hereunder. Subject to the foregoing, upon surrender of a Security
Certificate to the Agent on or after the Final Settlement Date, together with
settlement instructions thereon duly completed and executed, the Holder of such
Security Certificate shall be entitled to receive in exchange therefor a
certificate representing that number of whole shares of Common Stock which such
Holder is entitled to receive pursuant to the provisions of this Article Five
(after taking into account all Securities then held by such Holder) together
with cash in lieu of fractional shares as provided in Section 510 and any
dividends or distributions with respect to such shares constituting part of the
Final Settlement Fund, but without any interest thereon, and the Security
Certificate so surrendered shall forthwith be cancelled. Such shares shall be
registered in the name of the Holder or the Holder's designee as specified in
the settlement instructions on the Security Certificate.
If any shares of Common Stock issued in respect of a Purchase Contract
are to be registered to a Person other than the Person in whose name the
Security Certificate evidencing such Purchase Contract is registered, no such
registration shall be made unless the Person requesting such registration has
paid any transfer and other taxes required by reason of such registration in a
name other than that of the registered Holder of the Security Certificate
evidencing such Purchase Contract or has established to the satisfaction of the
Company that such tax either has been paid or is not payable.
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Section 506. Adjustment of Settlement Rate.
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(a) Adjustments for Dividends, Distributions, Stock Splits, Etc.
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(1) In case the Company shall pay or make a dividend or other
distribution on any class of Common Stock of the Company in Common Stock, the
Settlement Rate in effect at the opening of business on the day following the
date fixed for the determination of stockholders entitled to receive such
dividend or other distribution shall be increased by dividing such Settlement
Rate by a fraction of which the numerator shall be the number of shares of
Common Stock outstanding at the close of business on the date fixed for such
determination and the denominator shall be the sum of such number of shares and
the total number of shares constituting such dividend or other distribution,
such increase to become effective immediately after the opening of business on
the day following the date fixed for such determination. For the purposes of
this paragraph (1), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company but shall include
shares issuable in respect of scrip certificates issued in lieu of fractions of
shares of Common Stock. The Company will not pay any dividend or make any
distribution on shares of Common Stock held in the treasury of the Company.
(2) In case the Company shall issue rights, options or warrants to
all holders of its Common Stock (not being available on an equivalent basis to
Holders of the Securities upon settlement of the Purchase Contracts underlying
such Securities) entitling them, for a period expiring within 45 days after the
record date for the determination of stockholders entitled to receive such
rights, options or warrants, to subscribe for or purchase shares of Common Stock
at a price per share less than the Current Market Price per share of the Common
Stock on the date fixed for the determination of stockholders entitled to
receive such rights, options or warrants (other than pursuant to a dividend
reinvestment plan), the Settlement Rate in effect at the opening of business on
the day following the date fixed for such determination shall be increased by
dividing such Settlement Rate by a fraction of which the numerator shall be the
number of shares of Common Stock outstanding at the close of business on the
date fixed for such determination plus the number of shares of Common Stock
which the aggregate of the offering price of the total number of shares of
Common Stock so offered for subscription or purchase would purchase at such
Current Market Price and the denominator shall be the number of shares of Common
Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase, such increase to become effective immediately after
the opening of business on the day following the date fixed for such
determination. For the purposes of this paragraph (2), the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of Common Stock. The Company
shall not issue any such rights, options or warrants in respect of shares of
Common Stock held in the treasury of the Company.
(3) In case outstanding shares of Common Stock shall be subdivided
into a greater number of shares of Common Stock, the Settlement Rate in effect
at the opening of business on the day following the day upon which such
subdivision becomes effective shall be proportionately increased, and,
conversely, in case outstanding shares of Common Stock shall
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each be combined into a smaller number of shares of Common Stock, the Settlement
Rate in effect at the opening of business on the day following the day upon
which such combination becomes effective shall be proportionately reduced, such
increase or reduction, as the case may be, to become effective immediately after
the opening of business on the day following the day upon which such subdivision
or combination becomes effective.
(4) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Common Stock evidences of its indebtedness or assets
(including securities, but excluding any rights or warrants referred to in
paragraph (2) of this Section, any dividend or distribution paid exclusively in
cash and any dividend or distribution referred to in paragraph (1) of this
Section), the Settlement Rate shall be adjusted so that the same shall equal the
rate determined by dividing the Settlement Rate in effect immediately prior to
the close of business on the date fixed for the determination of stockholders
entitled to receive such distribution by a fraction of which the numerator shall
be the Current Market Price per share of the Common Stock on the date fixed for
such determination less the then fair market value (as determined by the Board
of Directors, whose determination shall be conclusive and described in a Board
Resolution filed with the Agent) of the portion of the assets or evidences of
indebtedness so distributed applicable to one share of Common Stock and the
denominator shall all be such Current Market Price per share of the Common
Stock, such adjustment to become effective immediately prior to the opening of
business on the day following the date fixed for the determination of
stockholders entitled to receive such distribution. In any case in which this
paragraph (4) is applicable, paragraph (2) of this Section shall not be
applicable.
(5) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Common Stock cash (excluding any cash that is distributed
in a Reorganization Event to which Section 506(b) applies or as part of a
distribution referred to in paragraph (4) of this Section) in an aggregate
amount that, combined together with (I) the aggregate amount of any other
distributions to all holders of its Common Stock made exclusively in cash within
the 12 months preceding the date of payment of such distribution and in respect
of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this
Section has been made and (II) the aggregate of any cash plus the fair market
value (as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of consideration payable in
respect of any tender or exchange offer by the Company or any of its
subsidiaries for all or any portion of the Common Stock concluded within the 12
months preceding the date of payment of such distribution and in respect of
which no adjustment pursuant to this paragraph (5) or paragraph (6) of this
Section has been made, exceeds 10% of the product of the Current Market Price
per share of the Common Stock on the date for the determination of holders of
shares of Common Stock entitled to receive such distribution times the number of
shares of Common Stock outstanding on such date, then, and in each such case,
immediately after the close of business on such date for determination, the
Settlement Rate shall be increased so that the same shall equal the rate
determined by dividing the Settlement Rate in effect immediately prior to the
close of business on the date fixed for determination of the stockholders
entitled to receive such distribution by a fraction (i) the numerator of which
shall be equal to the Current Market Price per share of the Common Stock on the
date fixed for such determination less an amount equal to the quotient of (x)
the excess of such combined amount over such 10% and (y) the number of shares of
Common Stock outstanding on such date for determination and (ii) the denominator
of which shall be
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equal to the Current Market Price per share of the Common Stock on such date for
determination.
(6) In case a tender or exchange offer made by the Company or any
subsidiary of the Company for all or any portion of the Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders (based on the acceptance (up
to any maximum specified in the terms of the tender or exchange offer) of
Purchased Shares) of an aggregate consideration having a fair market value (as
determined by the Board of Directors, whose determination shall be conclusive
and described in a Board Resolution) that combined together with (I) the
aggregate of the cash plus the fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution), as of the expiration of such tender or exchange offer, of
consideration payable in respect of any other tender or exchange offer, by the
Company or any subsidiary of the Company for all or any portion of the Common
Stock expiring within the 12 months preceding the expiration of such tender or
exchange offer and in respect of which no adjustment pursuant to paragraph (5)
of this Section or this paragraph (6) has been made and (II) the aggregate
amount of any distributions to all holders of the Company's Common Stock made
exclusively in cash within 12 months preceding the expiration of such tender or
exchange offer and in respect of which no adjustment pursuant to paragraph (5)
of this Section or this paragraph (6) has been made, exceeds 10% of the product
of the Current Market Price per share of the Common Stock as of the last time
(the "Expiration Time") tenders could have been made pursuant to such tender or
exchange offer (as it may be amended) times the number of shares of Common Stock
outstanding (including any tendered shares) on the Expiration Time, then, and in
each such case, immediately prior to the opening of business on the day after
the date of the Expiration Time, the Settlement Rate shall be adjusted so that
the same shall equal the rate determined by dividing the Settlement Rate
immediately prior to close of business on the date of the Expiration Time by a
fraction (i) the numerator of which shall be equal to (A) the product of (I) the
Current Market Price per share of the Common Stock on the date of the Expiration
Time and (II) the number of shares of Common Stock outstanding (including any
tendered shares) on the Expiration Time less (B) the amount of cash plus the
fair market value (determined as aforesaid) of the aggregate consideration
payable to stockholders based on the acceptance (up to any maximum specified in
the terms of the tender or exchange offer) of Purchased Shares, and (ii) the
denominator of which shall be equal to the product of (A) the Current Market
Price per share of the Common Stock as of the Expiration Time and (B) the number
of shares of Common Stock outstanding (including any tendered shares) as of the
Expiration Time less the number of all shares validly tendered and not withdrawn
as of the Expiration Time (the shares deemed so accepted, up to any such
maximum, being referred to as the "Purchased Shares").
(7) The reclassification of Common Stock into securities including
securities other than Common Stock (other than any reclassification upon a
Reorganization Event to which Section 506(b) applies) shall be deemed to involve
(a) a distribution of such securities other than Common Stock to all holders of
Common Stock (and the effective date of such reclassification shall be deemed to
be "the date fixed for the determination of stockholders entitled to receive
such distribution" and the "date fixed for such determination" within the
meaning of paragraph (4) of this Section), and (b) a subdivision or combination,
as the case
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may be, of the number of shares of Common Stock outstanding immediately prior to
such reclassification into the number of shares of Common Stock outstanding
immediately thereafter (and the effective date of such reclassification shall be
deemed to be "the day upon which such subdivision becomes effective" or "the day
upon which such combination becomes effective", as the case may be, and "the day
upon which such subdivision or combination becomes effective" within the meaning
of paragraph (3) of this Section).
(8) The "Current Market Price" per share of Common Stock on any day
means the average of the daily Closing Prices for the 5 consecutive Trading Days
selected by the Company commencing not more than 20 Trading Days before, and
ending not later than, the earlier of the day in question and the day before the
"ex" date with respect to the issuance or distribution requiring such
computation. For purposes of this paragraph, the term "'ex' date", when used
with respect to any issuance or distribution, shall mean the first date on which
the Common Stock trades regular way on such exchange or in such market without
the right to receive such issuance or distribution.
(9) All adjustments to the Settlement Rate shall be calculated to the
nearest 1/10,000th of a share of Common Stock (or if there is not a nearest
1/10,000th of a share to the next lower 1/10,000th of a share). No adjustment
in the Settlement Rate shall be required unless such adjustment would require an
increase or decrease of at least one percent therein; provided, however, that
-------- -------
any adjustments which by reason of this subparagraph are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
If an adjustment is made to the Settlement Rate pursuant to paragraphs (1), (2),
(3), (4), (5), (6), (7) or (10) of this Section 506(a), an adjustment shall also
be made to the Applicable Market Value solely to determine which of clauses (a),
(b) or (c) of the definition of Settlement Rate in Section 501 will apply on the
Final Settlement Date. Such adjustment shall be made by multiplying the
Applicable Market Value by a fraction of which the numerator shall be the
Settlement Rate immediately after such adjustment pursuant to paragraph (1),
(2), (3), (4), (5), (6), (7) or (10) of this Section 506(a) and the denominator
shall be the Settlement Rate immediately before such adjustment.
(10) The Company may make such increases in the Settlement Rate, in
addition to those required by this Section, as it considers to be advisable in
order to avoid or diminish any income tax to any holders of shares of Common
Stock resulting from any dividend or distribution of stock or issuance of rights
or warrants to purchase or subscribe for stock or from any event treated as such
for income tax purposes or for any other reasons.
(b) Adjustment for Consolidation, Merger or Other Reorganization Event. In
------------------------------------------------------------------
the event of (i) any consolidation or merger of the Company, with or into
another Person (other than a merger or consolidation in which the Company is the
continuing corporation and in which the Common Stock outstanding immediately
prior to the merger or consolidation is not exchanged for cash, securities or
other property of the Company or another corporation), (ii) any sale, transfer,
lease or conveyance to another Person of the property of the Company as an
entirety or substantially as an entirety, (iii) any statutory exchange of
securities of the Company with another Person (other than in connection with a
merger or acquisition) or (iv) any liquidation, dissolution or winding up of the
Company (any such event, a "Reorganization Event"), the Settlement Rate will be
adjusted to provide that each Holder of Securities will
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receive on the Final Settlement Date with respect to each Purchase Contract
forming a part thereof, the kind and amount of securities, cash and other
property receivable upon such Reorganization Event by a Holder of the number of
shares of Common Stock issuable on account of each Purchase Contract if the
Final Settlement Date had occurred immediately prior to such Reorganization
Event, assuming such Holder of Common Stock is not a Person with which the
Company consolidated or into which the Company merged or which merged into the
Company or to which such sale or transfer was made, as the case may be
("constituent Person"), or an Affiliate of a constituent Person, and failed to
exercise his rights of election, if any, as to the kind or amount of securities,
cash and other property receivable upon such Reorganization Event (provided that
if the kind or amount of securities, cash and other property receivable upon
such Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event by others than a constituent
Person or an Affiliate thereof and in respect of which such rights of election
shall not have been exercised ("non-electing share"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such Reorganization Event by each non-electing share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
non-electing shares). In the event of such a Reorganization Event, the Person
formed by such consolidation, merger or exchange or the Person which acquires
the assets of the Company or, in the event of a liquidation or dissolution of
the Company, the Company or a liquidating trust created in connection therewith,
shall execute and deliver to the Agent an agreement supplemental hereto
providing that the Holders of each Outstanding Security shall have the rights
provided by this Section 506. Such supplemental agreement shall provide for
adjustments which, for events subsequent to the effective date of such
supplemental agreement, shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Section. The above provisions of this
Section shall similarly apply to successive Reorganization Events.
Section 507. Notice of Adjustments and Certain Other Events.
----------------------------------------------
(a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall:
(i) forthwith compute the adjusted Settlement Rate in accordance
with Section 506 and prepare and transmit to the Agent an Officers'
Certificate setting forth the Settlement Rate, the method of calculation
thereof in reasonable detail, and the facts requiring such adjustment and
upon which such adjustment is based; and
(ii) within 10 Business Days following the occurrence of an event
that permits or requires an adjustment to the Settlement Rate pursuant to
Section 506 (or if the Company is not aware of such occurrence, as soon as
practicable after becoming so aware), provide a written notice to the
Holders of the Securities of the occurrence of such event and a statement
in reasonable detail setting forth the method by which the adjustment to
the Settlement Rate was determined and setting forth the adjusted
Settlement Rate.
(b) The Agent shall not at any time be under any duty or
responsibility to any holder of Securities to determine whether any facts exist
which may require any adjustment of the Settlement Rate, or with respect to the
nature or extent or calculation of any such
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adjustment when made, or with respect to the method employed in making the same.
The Agent shall not be accountable with respect to the validity or value (or the
kind or amount) of any shares of Common Stock, or of any securities or property,
which may at the time be issued or delivered with respect to any Purchase
Contract; and the Agent makes no representation with respect thereto. The Agent
shall not be responsible for any failure of the Company to issue, transfer or
deliver any shares of Common Stock pursuant to a Purchase Contract or to comply
with any of the duties, responsibilities or covenants of the Company contained
in this Article.
Section 508. Termination Event; Notice.
-------------------------
The Purchase Contracts and the obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract Fee,
shall immediately and automatically terminate, without the necessity of any
notice or action by any Holder, the Agent or the Company, if, on or prior to the
Final Settlement Date, a Termination Event shall have occurred. Upon the
occurrence of a Termination Event, the Company shall give written notice to the
Agent, the Collateral Agent and to the Holders, at their addresses as they
appear in the Security Register. Upon and after the occurrence of a Termination
Event, the Securities shall thereafter represent the right to receive the
Treasury Notes forming a part of such Securities in accordance with the
provisions of Section 402 and the Pledge Agreement.
Section 509. Early Settlement.
----------------
(a) Subject to and upon compliance with the provisions of this
Section 509 at the option of the Holder thereof, any Purchase Contracts
underlying Securities having an aggregate Stated Amount equal to $__________ or
an integral multiple thereof may be settled early ("Early Settlement") as
provided herein. In order to exercise the right to effect Early Settlement with
respect to any Purchase Contracts, the Holder of the Security Certificate
evidencing such Purchase Contracts shall deliver such Security Certificate to
the Agent at the Corporate Trust Office duly endorsed for transfer to the
Company or in blank with the form of Election to Settle Early on the reverse
thereof duly completed and accompanied by payment in the form of a certified or
cashier's check payable to the order of the Company in immediately available
funds in an amount (the "Early Settlement Amount") equal to (i) the product of
(A) the Stated Amount times (B) the number of Purchase Contracts with respect to
-----
which the Holder has elected to effect Early Settlement minus (ii) the aggregate
-----
amount of Contract Fees, if any, otherwise payable on or prior to the
immediately preceding Payment Date deferred at the option of the Company
pursuant to Section 503 and remaining unpaid as of such immediately preceding
Payment Date plus (iii) if such delivery is made with respect to any Purchase
----
Contracts during the period from the close of business on any Record Date next
preceding any Payment Date to the opening of business on such Payment Date, an
amount equal to the sum of (x) the Contract Fees payable on such Payment Date
with respect to such Purchase Contracts plus (y) the interest on the related
----
Treasury Notes payable on such Payment Date. Except as provided in the
immediately preceding sentence and subject to the last paragraph of Section 502,
no payment or adjustment shall be made upon Early Settlement of any Purchase
Contract on account of any Contract Fees accrued on such Purchase Contract or on
account of any dividends on the Common Stock issued upon such Early Settlement.
If
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the foregoing requirements are first satisfied with respect to Purchase
Contracts underlying any Securities at or prior to 5:00 p.m., New York City
time, on a Business Day, such day shall be the "Early Settlement Date" with
respect to such Securities and if such requirements are first satisfied after
5:00 p.m., New York City time, on a Business Day or on a day that is not a
Business Day, the "Early Settlement Date" with respect to such Securities shall
be the next succeeding Business Day.
(b) Upon Early Settlement of Purchase Contracts by a Holder of the
related Securities, the Company shall issue, and the Holder shall be entitled to
receive, a number of shares of Common Stock on account of each Purchase Contract
as to which Early Settlement is effected equal to the Early Settlement Rate.
The Early Settlement Rate shall initially be equal to __________ and shall be
adjusted in the same manner and at the same time as the Settlement Rate is
adjusted. As promptly as practicable after Early Settlement of Purchase
Contracts in accordance with the provisions of this Section 509, the Company
shall issue and shall deliver to the Agent at the Corporate Trust Office a
certificate or certificates for the full number of shares of Common Stock
issuable upon such Early Settlement together with payment in lieu of any
fraction of a share, as provided in Section 510.
(c) The Company shall cause the shares of Common Stock issuable, and
Treasury Notes deliverable, upon Early Settlement of Purchase Contracts to be
issued and delivered, in the case of such shares of Common Stock, and released
from the Pledge by the Collateral Agent and transferred, in the case of such
Treasury Notes, to the Purchase Contract Agent, for delivery to the Holder
thereof or its designee, no later than the third Business Day after the
applicable Early Settlement Date.
(d) Upon Early Settlement of any Purchase Contracts, and subject to
receipt thereof from the Company or the Collateral Agent, as applicable, the
Agent shall, in accordance with the instructions provided by the Holder thereof
on the applicable form of Election to Settle Early on the reverse of the
Security Certificate evidencing the related Securities, (i) transfer the
Treasury Notes forming a part of such Securities and (ii) deliver a certificate
or certificates for the full number of shares of Common Stock issuable upon such
Early Settlement together with payment in lieu of any fraction of a share, as
provided in Section 510.
(e) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
Security Certificate, upon such Early Settlement the Company shall execute and
the Agent shall authenticate, countersign and deliver to the Holder thereof, at
the expense of the Company, a Security Certificate evidencing the Securities as
to which Early Settlement was not effected.
Section 510. No Fractional Shares.
--------------------
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Final Settlement Date
or upon Early Settlement of any Purchase Contracts. If Security Certificates
evidencing more than one Purchase Contract shall be surrendered for settlement
at one time by the same Holder, the number of full shares of Common Stock which
shall be delivered upon settlement shall be
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computed on the basis of the aggregate number of Purchase Contracts evidenced by
the Security Certificates so surrendered. Instead of any fractional share of
Common Stock which would otherwise be deliverable upon settlement of any
Purchase Contracts on the Final Settlement Date or upon Early Settlement, the
Company, through the Agent, shall make a cash payment in respect of such
fractional interest in an amount equal to the value of such fractional shares at
the Closing Price per share on the Trading Day immediately preceding the Final
Settlement Date or the related Early Settlement Date, respectively. The Company
shall provide the Agent from time to time with sufficient funds to permit the
Agent to make all cash payments required by this Section 510 in a timely manner.
Section 511. Charges and Taxes.
-----------------
The Company will pay all stock transfer and similar taxes attributable
to the initial issuance and delivery of the shares of Common Stock pursuant to
the Purchase Contracts; provided, however, that the Company shall not be
-------- -------
required to pay any such tax or taxes which may be payable in respect of any
exchange of or substitution for a Security Certificate evidencing a Purchase
Contract or any issuance of a share of Common Stock in a name other than that of
the registered Holder of a Security Certificate surrendered in respect of the
Purchase Contracts evidenced thereby, other than in the name of the Agent, as
custodian for such Holder, and the Company shall not be required to issue or
deliver such share certificates or Security Certificates unless or until the
Person or Persons requesting the transfer or issuance thereof shall have paid to
the Company the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid.
ARTICLE SIX
Remedies
Section 601. Unconditional Right of Holders to Receive Contract Fee.
------------------------------------------------------
Notwithstanding any other provision in this Agreement, the Holder of
any Security shall have the right, which is absolute and unconditional (subject
to the right of the Company to defer payment thereof pursuant to Section 503),
to receive payment of each installment of the Contract Fee with respect to the
Purchase Contract constituting a part of such Security on the respective Payment
Date for such Security and to purchase Common Stock pursuant to such Purchase
Contract and, in each such case, to institute suit for the enforcement of any
such payment and right to purchase Common Stock, and such rights shall not be
impaired without the consent of such Holder.
Section 602. Restoration of Rights and Remedies.
----------------------------------
If any Holder of Securities has instituted any proceeding to enforce
any right or remedy under this Agreement and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company and such Holder shall be
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restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of such Holder shall continue as though no
such proceeding had been instituted.
Section 603. Rights and Remedies Cumulative.
------------------------------
Except as otherwise provided with respect to the replacement of
mutilated, destroyed, lost or stolen Security Certificates in the last paragraph
of Section 306, no right or remedy herein conferred upon or reserved to the
Holders of Securities is intended to be exclusive of any other right or remedy,
and every right and remedy shall, to the extent permitted by law, be cumulative
and in addition to every other right and remedy given hereunder or now or
hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
Section 604. Delay or Omission Not Waiver.
----------------------------
No delay or omission of any Holder to exercise any right or remedy
shall impair any such right or remedy or constitute a waiver of any such right.
Every right and remedy given by this Article or by law to the Holders may be
exercised from time to time, and as often as may be deemed expedient, by such
Holders.
Section 605. Undertaking for Costs.
---------------------
All parties to this Agreement agree, and each Holder of any Security
by his acceptance of the Security Certificate evidencing such Security 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 Agreement, or in any suit
against the Agent for any action taken, suffered or omitted by it as Agent, 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; provided that the provisions of this Section shall not
--------
apply to any suit instituted by the Company, to any suit instituted by the
Agent, to any suit instituted by any Holder of Securities, or group of Holders,
holding in the aggregate more than 10% of the Outstanding Securities, or to any
suit instituted by any Holder for the enforcement of the payment of the interest
on any Treasury Note or the Contract Fee on any Purchase Contract on or after
the respective Payment Date therefor constituting a part of the Securities held
by such Holder, or for enforcement of the right to purchase shares of Common
Stock under the Purchase Contracts constituting a part of the Securities held by
such Holder.
Section 606. Waiver of Stay or Extension Laws.
--------------------------------
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or
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advantage of any such law and covenants that it will not hinder, delay or impede
the execution of any power herein granted to the Agent or the Holders, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
ARTICLE SEVEN
The Agent
Section 701. Certain Duties and Responsibilities.
-----------------------------------
(a) (1) The Agent undertakes to perform, with respect to the
Securities, such duties and only such duties as are specifically set forth
in this Agreement, and no implied covenants or obligations shall be read
into this Agreement against the Agent; and
(2) in the absence of bad faith or negligence on its part, the Agent
may, with respect to the Securities, conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Agent and conforming to the
requirements of this Agreement, but in the case of any certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Agent, the Agent shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this
Agreement.
(b) No provision of this Agreement shall be construed to relieve the
Agent from liability for its own negligent action, its own negligent failure to
act, or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the Agent shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Agent was negligent in ascertaining the pertinent facts; and
(3) no provision of this Agreement shall require the Agent to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of
its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(c) Whether or not therein expressly so provided, every provision of
this Agreement relating to the conduct or affecting the liability of or
affording protection to the Agent shall be subject to the provisions of this
Section.
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Section 702. Notice of Default.
-----------------
Within 90 days after the occurrence of any default by the Company
hereunder, of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to all Holders of Securities, as their names and
addresses appear in the Security Register, notice of such default hereunder,
unless such default shall have been cured or waived.
Section 703. Certain Rights of Agent.
-----------------------
Subject to the provisions of Section 701:
(a) the Agent may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officers' Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Agreement the Agent shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Agent (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate of the Company;
(d) the Agent may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(e) the Agent shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Agent, in its discretion, may make reasonable further
inquiry or investigation into such facts or matters related to the issuance
of the Securities and the execution, delivery and performance of the
Purchase Contracts as it may see fit, and, if the Agent shall determine to
make such further inquiry or investigation, it shall be entitled to examine
the books, records and promises of the Company, personally or by agent or
attorney; and
(f) the Agent may execute any of its powers hereunder or perform any
duties hereunder either directly or by or through agents or attorneys and
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<PAGE>
the Agent shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder.
Section 704. Not Responsible for Recitals or Issuance of Securities.
------------------------------------------------------
The recitals contained herein and in the Security Certificates shall
be taken as the statements of the Company and the Agent assumes no
responsibility for their correctness. The Agent makes no representations as to
the validity or sufficiency of this Agreement or of the Securities. The Agent
shall not be accountable for the use or application by the Company of the
proceeds in respect of the Purchase Contracts.
Section 705. May Hold Securities.
-------------------
Any Security Registrar or any other agent of the Company, or the
Agent, in its individual or any other capacity, may become the owner or pledgee
of Securities and may otherwise deal with the Company with the same rights it
would have if it were not Security Registrar or such other agent, or the Agent.
Section 706. Money Held in Trust.
-------------------
Money held by the Agent in trust hereunder need not be segregated from
the other funds except to the extent required by law. The Agent shall be under
no obligation to invest or pay interest on any money received by it hereunder
except as otherwise agreed with the Company.
Section 707. Compensation and Reimbursement.
------------------------------
The Company agrees:
(1) to pay to the Agent from time to time reasonable compensation for
all services rendered by it hereunder;
(2) except as otherwise expressly provided herein, to reimburse the
Agent upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Agent in accordance with any provision of
this Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Agent and any predecessor Agent for, and to hold
each of them harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of its duties hereunder,
including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its
powers or duties hereunder.
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<PAGE>
Section 708. Corporate Agent Required; Eligibility.
-------------------------------------
There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least $50,000,000, subject to supervision or examination by Federal or
State authority and having its Corporate Trust Office in the Borough of
Manhattan, The City of New York, if there be such a corporation in the Borough
of Manhattan, The City of New York qualified and eligible under this Article and
willing to act on reasonable terms. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Agent shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
Section 709. Resignation and Removal; Appointment of Successor.
-------------------------------------------------
(a) No resignation or removal of the Agent and no appointment of a
successor Agent pursuant to this Article shall become effective until the
acceptance of appointment by the successor Agent in accordance with the
applicable requirements of Section 710.
(b) The Agent may resign at any time by giving written notice thereof
to the Company 60 days prior to the effective date of such resignation. If the
instrument of acceptance by a successor Agent required by Section 710 shall not
have been delivered to the Agent within 30 days after the giving of such notice
of resignation, the resigning Agent may petition any court of competent
jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders of a
majority in number of the Outstanding Securities delivered to the Agent and the
Company.
(d) If at any time
(1) the Agent fails to comply with Section 310(b) of the TIA, as if
the Agent were an indenture trustee under an indenture qualified under the
TIA, after written request therefor by the Company or by any Holder who has
been a bona fide Holder of a Security for at least six months, or
(2) the Agent shall cease to be eligible under Section 708 and shall
fail to resign after written request therefor by the Company or by any such
Holder, or
(3) the Agent shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Agent or of its property shall
be appointed or any public officer shall take charge or control of the
Agent or of
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<PAGE>
its property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Agent, or (ii) any Holder who has been a bona fide Holder of a Security for at
least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Agent and
the appointment of a successor Agent.
(e) If the Agent shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Agent for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Agent and
shall comply with the applicable requirements of Section 710. If no successor
Agent shall have been so appointed by the Company and accepted appointment in
the manner required by Section 710, any Holder who has been a bona fide Holder
of a Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Agent.
(f) The Company shall give, or shall cause such successor Agent to
give, notice of each resignation and each removal of the Agent and each
appointment of a successor Agent by mailing written notice of such event by
first-class mail, postage prepaid, to all Holders of Securities as their names
and addresses appear in the Security Register. Each notice shall include the
name of the successor Agent and the address of its Corporate Trust Office.
Section 710. Acceptance of Appointment by Successor.
--------------------------------------
(a) In case of the appointment hereunder of a successor Agent, every
such successor Agent so appointed shall execute, acknowledge and deliver to the
Company and to the retiring Agent an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Agent shall become
effective and such successor Agent, without any further act, deed or conveyance,
shall become vested with all the rights, powers, agencies and duties of the
retiring Agent; but, on the request of the Company or the successor Agent, such
retiring Agent shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Agent all the rights, powers and
trusts of the retiring Agent and shall duly assign, transfer and deliver to such
successor Agent all property and money held by such retiring Agent hereunder.
(b) Upon request of any such successor Agent, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Agent all such rights, powers and agencies referred
to in paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at the
time of such acceptance such successor Agent shall be qualified and eligible
under this Article.
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<PAGE>
Section 711. Merger, Conversion, Consolidation or Succession to Business.
-----------------------------------------------------------
Any corporation into which the Agent may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Agent shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Agent, shall be the successor of the Agent hereunder, provided such
--------
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Security Certificates shall have been
authenticated and executed on behalf of the Holders, but not delivered, by the
Agent then in office, any successor by merger, conversion or consolidation to
such Agent may adopt such authentication and execution and deliver the Security
Certificates so authenticated and executed with the same effect as if such
successor Agent had itself authenticated and executed such Securities.
Section 712. Preservation of Information; Communications to Holders.
------------------------------------------------------
(a) The Agent shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders received by the Agent in its
capacity as Security Registrar.
(b) If three or more Holders (herein referred to as "applicants")
apply in writing to the Agent, and furnish to the Agent reasonable proof that
each such applicant has owned a Security for a period of at least six months
preceding the date of such application, and such application states that the
applicants desire to communicate with other Holders with respect to their rights
under this Agreement or under the Securities and is accompanied by a copy of the
form of proxy or other communication which such applicants propose to transmit,
then the Agent shall, within five Business Days after the receipt of such
application, afford such applicants access to the information preserved at the
time by the Agent in accordance with Section 712(a).
(c) Every Holder of Securities, by receiving and holding the Security
Certificates evidencing the same, agrees with the Company and the Agent that
none of the Company, the Agent nor any agent of any of them shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of the Holders in accordance with Section 712(b), regardless of
the source from which such information was derived.
Section 713. No Obligations of Agent.
-----------------------
Except to the extent otherwise provided in this Agreement, the Agent
assumes no obligations and shall not be subject to any liability under this
Agreement or any Purchase Contract in respect of the obligations of the Holder
of any Security thereunder. The Company agrees, and each Holder of a Security
Certificate, by his acceptance thereof, shall be deemed to have agreed, that the
Agent's execution of the Security Certificates on behalf of the Holders shall be
solely as agent and attorney-in-fact for the Holders, and that the Agent shall
have no obligation to perform such Purchase Contracts on behalf of the Holders,
except to the extent expressly provided in Article Five hereof.
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<PAGE>
Section 714. Tax Compliance.
--------------
(a) The Agent, on its own behalf and on behalf of the Company, will
comply with all applicable certification, information reporting and withholding
(including "backup" withholding) requirements imposed by applicable tax laws,
regulations or administrative practice with respect to (i) any payments made
with respect to the Securities or (ii) the issuance, delivery, holding,
transfer, redemption or exercise of rights under the Securities. Such
compliance shall include, without limitation, the preparation and timely filing
of required returns and the timely payment of all amounts required to be
withheld to the appropriate taxing authority or its designated agent.
(b) The Agent shall comply with any direction received from the
Company with respect to the application of such requirements to particular
payments or Holders or in other particular circumstances, and may for purposes
of this Agreement rely on any such direction in accordance with the provisions
of Section 701(a)(2) hereof.
(c) The Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records available on
request to the Company or to its authorized representative.
ARTICLE EIGHT
Supplemental Agreements
Section 801. Supplemental Agreements Without Consent of Holders.
--------------------------------------------------
Without the consent of any Holders, the Company and the Agent, at any
time and from time to time, may enter into one or more agreements supplemental
hereto, in form satisfactory to the Company and the Agent, for any of the
following purposes:
(1) to evidence the succession of another Person to the Company, and
the assumption by any such successor of the covenants of the Company herein
and in the Security Certificates; or
(2) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the
Company; or
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(4) to make provision with respect to the rights of Holders pursuant
to the requirements of Section 506(b); or
(5) to cure any ambiguity, to correct or supplement any provisions
herein which may be inconsistent with any other provisions herein, or to
make any other provisions with respect to such matters or questions arising
under
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<PAGE>
this Agreement, provided such action shall not adversely affect the
--------
interests of the Holders.
Section 802. Supplemental Agreements with Consent of Holders.
-----------------------------------------------
With the consent of the Holders of not less than 66 2/3% of the
Outstanding Securities, by Act of said Holders delivered to the Company and the
Agent, the Company when authorized by a Board Resolution, and the Agent may
enter into an agreement or agreements supplemental hereto for the purpose of
modifying in any manner the terms of the Securities, or the provisions of this
Agreement or the rights of the Holders in respect of the Securities; provided,
--------
however, that no such supplemental agreement shall, without the consent of the
- -------
Holder of each Outstanding Security affected thereby,
(1) change any Payment Date;
(2) change the amount or type of Treasury Notes underlying a
Security, impair the right of the Holder of any Security to receive
interest payments on the underlying Treasury Notes or otherwise adversely
affect the Holder's rights in or to such Treasury Notes;
(3) reduce any Contract Fee or change any place where, or the coin or
currency in which, any Contract Fee is payable;
(4) impair the right to institute suit for the enforcement of any
Purchase Contract;
(5) reduce the number of shares of Common Stock to be purchased
pursuant to any Purchase Contract, increase the price to purchase shares of
Common Stock upon settlement of any Purchase Contract, change the Final
Settlement Date or otherwise adversely affect the Holder's rights under any
Purchase Contract; or
(6) reduce the percentage of the Outstanding Securities the consent
of whose Holders is required for any such supplemental agreement.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental agreement, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 803. Execution of Supplemental Agreements.
------------------------------------
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Agent shall be entitled to receive
and (subject to Section 701) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental agreement is
authorized or permitted by this Agreement. The Agent may, but shall not be
obligated to, enter into any such supplemental agreement which affects the
Agent's own rights, duties or immunities under this Agreement or otherwise.
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<PAGE>
Section 804. Effect of Supplemental Agreements.
---------------------------------
Upon the execution of any supplemental agreement under this Article,
this Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Security Certificates theretofore or thereafter authenticated, executed on
behalf of the Holders and delivered hereunder shall be bound thereby.
Section 805. Reference to Supplemental Agreements.
------------------------------------
Security Certificates authenticated, executed on behalf of the Holders
and delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Security Certificates so
modified as to conform, in the opinion of the Agent and the Company, to any such
supplemental agreement may be prepared and executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the Agent in
exchange for Outstanding Security Certificates.
ARTICLE NINE
Consolidation, Merger, Sale or Conveyance
Section 901. Covenant Not to Merge, Consolidate, Sell or Convey Property Except
------------------------------------------------------------------
Under Certain Conditions.
------------------------
The Company covenants that it will not merge or consolidate with any
other Person or sell or convey all or substantially all of its assets to any
Person, except that the Company may merge or consolidate with, or sell or convey
all or substantially all of its assets to, any other Person, provided that (i)
the Company shall be the continuing corporation, or the successor (if other than
the Company) shall be a corporation organized and existing under the laws of the
United States of America or a State thereof and such corporation shall assume
the obligations of the Company under the Purchase Contracts, this Agreement and
the Pledge Agreement by one or more supplemental agreements in form satisfactory
to the Agent and the Collateral Agent, executed and delivered to the Agent and
the Collateral Agent by such corporation, and (ii) the Company or such successor
corporation, as the case may be, shall not, immediately after such merger of
consolidation, or such sale or conveyance, be in default in the performance of
any covenant or condition hereunder, under any of the Securities or under the
Pledge Agreement.
Section 902. Rights and Duties of Successor Corporation.
------------------------------------------
In case of any such consolidation, merger, sale or conveyance and upon
any such assumption by the successor corporation, such successor corporation
shall succeed to and be substituted for the Company with the same effect as if
it had been named herein as the Company. Such successor corporation thereupon
may cause to be signed, and may issue
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<PAGE>
either in its own name or in the name of Alco Standard Corporation, any or all
of the Security Certificates evidencing Securities issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Agent; and, upon the order of such successor corporation, instead of the
Company, and subject to all the terms, conditions and limitations in this
Agreement prescribed, the Agent shall authenticate and execute on behalf of the
Holders and deliver any Security Certificates which previously shall have been
signed and delivered by the officers of the Company to the Agent for
authentication and execution, and any Security Certificate evidencing Securities
which such successor corporation thereafter shall cause to be signed and
delivered to the Agent for that purpose. All the Security Certificates so
issued shall in all respects have the same legal rank and benefit under this
Agreement as the Security Certificates theretofore or thereafter issued in
accordance with the terms of this Agreement as though all of such Security
Certificates had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale or conveyance such
change in phraseology and form (but not in substance) may be made in the
Security Certificates evidencing Securities thereafter to be issued as may be
appropriate.
Section 903. Opinion of Counsel to Agent.
---------------------------
The Agent, subject to Sections 701 and 703, may receive an Opinion of
Counsel as conclusive evidence that any such consolidation, merger, sale or
conveyance, and any such assumption, complies with the provisions of this
Article.
ARTICLE TEN
Covenants
Section 1001. Performance Under Purchase Contracts.
------------------------------------
The Company covenants and agrees for the benefit of the Holders from
time to time of the Securities that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
Section 1002. Maintenance of Office or Agency.
-------------------------------
The Company will maintain in the Borough of Manhattan, The City of New
York an office or agency where Security Certificates may be presented or
surrendered for acquisition of shares of Common Stock upon settlement or Early
Settlement and for transfer of Treasury Notes upon occurrence of a Termination
Event, where Security Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Company in
respect of the Securities and this Agreement may be served. The Company will
give prompt written notice to the Agent of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Agent
with the address
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<PAGE>
thereof, such presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office, and the Company hereby appoints the Agent
as its agent to receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies where Security Certificates may be presented or surrendered
for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
-------- -------
any manner relieve the Company of its obligation to maintain an office or agency
in the Borough of Manhattan, The City of New York for such purposes. The
Company will give prompt written notice to the Agent of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates as the place of payment for the Securities the
Corporate Trust Office and appoints the Agent at its Corporate Trust Office as
paying agent in such city.
Section 1003. Company to Reserve Common Stock.
-------------------------------
The Company shall at all times prior to the Final Settlement Date
reserve and keep available, free from preemptive rights, out of its authorized
but unissued Common Stock the full number of shares of Common Stock issuable
against tender of payment in respect of all Purchase Contracts constituting a
part of the Securities evidenced by Outstanding Security Certificates.
Section 1004. Covenants as to Common Stock.
----------------------------
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Securities will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
Section 1005. Statements of Officers of the Company as to Default.
---------------------------------------------------
The Company will deliver to the Agent, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions hereof, and if the Company shall be in default,
specifying all such defaults and the nature and status thereof of which they may
have knowledge.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
ALCO STANDARD CORPORATION
Attested by By:
_____________________ ___________________________
___________________________
as Agent
Attested by By:
_____________________ ___________________________
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<PAGE>
EXHIBIT A
ALCO STANDARD CORPORATION
Automatic Common Exchange Securities
(Stated Amount $________ per Security)
No.
_________ Securities
This Security Certificate certifies that ______________________ is the
registered Holder of the number of Securities set forth above. Each Security
represents ownership by the Holder of ___% United States Government ___% Notes
due ___________, 199_ ("Treasury Notes") with a principal amount equal to the
Stated Amount, subject to the Pledge of such Treasury Notes by such Holder
pursuant to the Pledge Agreement, and the rights and obligations of the Holder
under one Purchase Contract with Alco Standard Corporation, an Ohio corporation
(the "Company").
Pursuant to the Pledge Agreement, the Treasury Notes constituting part of
each Security evidenced hereby have been pledged to the Collateral Agent to
secure the obligations of the Holder under the Purchase Contract constituting
part of such Security.
The Pledge Agreement provides that all payments of principal of, or
interest on, any Treasury Notes constituting part of the Securities received by
the Collateral Agent shall be paid by the Collateral Agent by wire transfer in
same day funds no later than _____________, New York City time, on the Business
Day such payment is received by the Collateral Agent (provided that in the event
such payment is received by the Collateral Agent on a day that is not a Business
Day or after ______________, New York City time, on a Business Day, then such
payment shall be made no later than _____________, New York City time, on the
next succeeding Business Day) (i) in the case of (A) interest payments and (B)
any principal payments with respect to any Treasury Notes that have been
released from the Pledge pursuant to the Pledge Agreement, to the Agent to the
account designated by it for such purpose and (ii) in the case of principal
payments on any Pledged Treasury Notes (as defined in the Pledge Agreement), to
the Company, in full satisfaction of the respective obligations of the Holders
of the Securities of which such Pledged Treasury Securities are a part under the
Purchase Contracts forming a
<PAGE>
part of such Securities. Interest on any Treasury Note forming part of a
Security evidenced hereby which is paid on any _______ or ________, commencing
_____________, 199_ (a "Payment Date"), shall, subject to receipt thereof by the
Agent from the Collateral Agent, be paid to the Person in whose name this
Security Certificate (or a Predecessor Security Certificate) is registered at
the close of business on the Record Date next preceding such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
Security Certificate to purchase, and the Company to sell, on __________, 199_
(the "Final Settlement Date"), at a price equal to $__________ (the "Stated
Amount"), a number of shares of Common Stock, par value $.01 per share ("Common
Stock"), of the Company, equal to the Settlement Rate, unless on or prior to the
Final Settlement Date there shall have occurred a Termination Event or Early
Settlement with respect to the Security of which such Purchase Contract is a
part, all as provided in the Purchase Contract Agreement and more fully
described on the reverse hereof. The purchase price for the shares of Common
Stock purchased pursuant to each Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the Final Settlement Date by application of payment
received in respect of the principal of the Treasury Notes pledged to secure the
obligations under such Purchase Contract of the Holder of the Security of which
such Purchase Contract is a part.
The Company shall pay, on each Payment Date, in respect of each Purchase
Contract forming part of a Security evidenced hereby a fee (the "Contract Fee")
equal to _____% per annum of the Stated Amount, from __________, 199_, computed
on the basis of the actual number of days elapsed in a year of 365 or 366 days,
as the case may be, subject to deferral at the option of the Company as provided
in the Purchase Contract Agreement and more fully described on the reverse
hereof. Such Contract Fee shall be payable to the Person in whose name this
Security Certificate (or a Predecessor Security Certificate) is registered at
the close of business on the Record Date next preceding such Payment Date.
Interest on the Treasury Notes and the Contract Fee will be payable at the
office of the Agent in The City of New York or, at the option of the Company, by
check mailed to the address of the Person entitled thereto as such address
appears on the Security Register.
Reference is hereby made to the further provisions set forth on the reverse
hereof, which further provisions
-2-
<PAGE>
shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Agent by manual signature, this Security Certificate shall not be entitled to
any benefit under the Pledge Agreement or the Purchase Contract Agreement or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
ALCO STANDARD CORPORATION
By: _____________________________
Attest: ____________________
HOLDER SPECIFIED ABOVE
(as to obligations of such Holder
under the Purchase Contracts
evidenced hereby)
By: ___________________________
as Attorney-in-Fact of such
Holder
By: ___________________________
Dated:
This is one of the Security Certificates referred to in the within
mentioned Purchase Contract Agreement.
_______________________________________,
as Agent
By: __________________________________
-3-
<PAGE>
[Form of Reverse of Security Certificate]
Each Purchase Contract evidenced hereby is governed by a Purchase Contract
Agreement, dated as of __________, 199_ (the "Purchase Contract Agreement"),
between the Company and ___________________, as Agent (herein called the
"Agent"), to which Purchase Contract Agreement and supplemental agreements
thereto reference is hereby made for a description of the respective rights,
limitations of rights, obligations, duties and immunities thereunder of the
Agent, the Company, and the Holders and of the terms upon which the Security
Certificates are, and are to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Security Certificate to purchase, and the Company to sell, on the Final
Settlement Date at a price equal to the Stated Amount, a number of shares of
Common Stock of the Company equal to the Settlement Rate, unless, on or prior to
the Final Settlement Date, there shall have occurred a Termination Event or an
Early Settlement with respect to the Security of which such Purchase Contract is
a part. The "Settlement Rate" is equal to (a) if the Applicable Market Value
(as defined below) is greater than $_____ (the "Threshold Appreciation Price"),
_____ shares of Common Stock per Purchase Contract, (b) if the Applicable Market
Value is less than or equal to the Threshold Appreciation Price but is greater
than the Stated Amount, a fractional share of Common Stock per Purchase Contract
equal to the Stated Amount divided by the Applicable Market Value and (c) if the
Applicable Market Amount is less than or equal to the Stated Amount, one share
of Common Stock per Purchase Contract, in each case subject to adjustment as
provided in the Purchase Contract. No fractional shares of Common Stock will be
issued upon settlement of Purchase Contracts, as provided in the Purchase
Contract Agreement.
The "Applicable Market Value" means the average of the Closing Prices per
share of Common Stock on each of the twenty consecutive Trading Days ending on
the last Trading Day immediately preceding the Final Settlement Date. The
"Closing Price" of the Common Stock on any date of determination means the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on the New York Stock Exchange (the "NYSE") on such
date or, if the Common Stock is not listed for trading on the NYSE on any such
date, as reported in the composite transactions for the principal United States
securities exchange on which the Common Stock is so listed, or if the Common
Stock is not so listed on a United States national or regional securities
exchange, as reported by The Nasdaq Stock Market, or, if the Common Stock is not
so reported, the last quoted bid price for the Common Stock in the over-the-
counter
-4-
<PAGE>
market as reported by the National Quotation Bureau or similar organization, or,
if such bid price is not available, the market value of the Common Stock on such
date as determined by a nationally recognized independent investment banking
firm retained for this purpose by the Company. A "Trading Day" means as a day
on which the Common Stock (A) is not suspended from trading on any national or
regional securities exchange or association or over-the-counter market at the
close of business and (B) has traded at least once on the national or regional
securities exchange or association or over-the-counter market that is the
primary market for the trading of the Common Stock.
The purchase price for the shares of Common Stock purchased pursuant to
each Purchase Contract shall be paid by application of payments received by the
Company on the Final Settlement Date from the Collateral Agent pursuant to the
Pledge Agreement in respect of the principal of the Treasury Notes Pledged to
secure the obligations of the relevant Holder under such Purchase Contract. The
Company shall not be obligated to issue any shares of Common Stock in respect of
a Purchase Contract or deliver any certificates therefor to the Holder unless it
shall have received payment in full of the aggregate purchase price for the
shares of Common Stock to be purchased thereunder in the manner herein set
forth.
Subject to the next succeeding paragraph, the Company shall pay, on each
Payment Date, the Contract Fee payable in respect of each Purchase Contract to
the Person in whose name the Security Certificate evidencing such Purchase
Contract is registered at the close of business on the Record Date next
preceding such Payment Date. Contract Fees will be payable at the office of the
Agent in The City of New York or, at the option of the Company, by check mailed
to the address of the Person entitled thereto at such address as it appears on
the Security Register.
The Company shall have the right, at any time prior to the Final Settlement
Date, to defer the payment of any or all of the Contract Fees otherwise payable
on any Payment Date, but only if the Company shall give the Holders and the
Agent written notice of its election to defer such payment (specifying the
amount to be deferred) as provided in the Purchase Contract Agreement. Any
Contract Fees so deferred shall bear additional Contract Fees thereon at the
rate of _____ per annum (computed on the basis of the actual number of days
elapsed in a year of 365 or 366 days, as the case may be), compounding on each
succeeding Payment Date, until paid in full. Deferred Contract Fees (and
additional Contract Fees accrued thereon) shall be due on the next succeeding
Payment Date except to the extent that payment is deferred pursuant to the
Purchase Contract Agreement. No
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<PAGE>
Contract Fees may be deferred to a date that is after the Final Settlement Date.
The Purchase Contracts and the obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Fee, shall
immediately and automatically terminate, without the necessity of any notice or
action by any Holder, the Agent or the Company, if, on or prior to the Final
Settlement Date, a Termination Event shall have occurred. Upon the occurrence of
a Termination Event, the Company shall give written notice to the Agent and to
the Holders, at their addresses as they appear in the Security Register. Upon
and after the occurrence of a Termination Event, the Collateral Agent shall
release the Treasury Notes from the Pledge. The Securities shall thereafter
represent the right to receive the Treasury Notes forming a part of such
Securities in accordance with the provisions of the Purchase Contract Agreement
and the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase Contract
Agreement at the option of the Holder thereof, Purchase Contracts underlying
Securities having an aggregate Stated Amount equal to $__________ or an integral
multiple thereof may be settled early ("Early Settlement") as provided in the
Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contracts evidenced by this Security
Certificate, the Holder of this Security Certificate shall deliver this Security
Certificate to the Agent at the Corporate Trust Office duly endorsed for
transfer to the Company or in blank with the form of Election to Settle Early
set forth below duly completed and accompanied by payment in the form of a
certified or cashier's check payable to the order of the Company in immediately
available funds in an amount (the "Early Settlement Amount") equal to (i) the
product of (A) the Stated Amount times (B) the number of Purchase Contracts with
-----
respect to which the Holder has elected to effect Early Settlement minus (ii)
-----
the aggregate amount of Contract Fees, if any, otherwise payable on or prior to
the immediately preceding Payment Date deferred at the option of the Company
pursuant to the Purchase Contract Agreement and remaining unpaid as of such
immediately preceding Payment Date plus (iii) if such delivery is made with
----
respect to any Purchase Contracts during the period from the close of business
on any Record Date next preceding any Payment Date to the opening of business on
such Payment Date, an amount equal to the sum of (x) the Contract Fees payable
on such Payment Date with respect to such Purchase Contracts plus (y) the
----
interest with respect to the related Treasury Notes payable on such Payment
Date. Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Treasury Notes underlying such Securities shall
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<PAGE>
be released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive, a number of shares of Common Stock on account of
each Purchase Contract forming part of a Security as to which Early Settlement
is effected equal to the Early Settlement Rate. The Early Settlement Rate shall
initially be equal to __________ and shall be adjusted in the same manner and at
the same time as the Settlement Rate is adjusted as provided in the Purchase
Contract Agreement.
The Security Certificates are issuable only in registered form and only in
denominations of a single Security and any integral multiple thereof. The
transfer of any Security Certificate will be registered and Security
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Security Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. For so long as the Purchase Contract underlying
a Security remains in effect, such Security shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Security
in respect of the Treasury Notes and Purchase Contract constituting such
Security may be transferred and exchanged only as a Security.
Upon registration of transfer of this Security Certificate, the transferee
shall be bound (without the necessity of any other action on the part of such
transferee, except as may be required by the Agent pursuant to the Purchase
Contract Agreement), under the terms of the Purchase Contract Agreement and the
Purchase Contracts evidenced hereby and the transferor shall be released from
the obligations under the Purchase Contracts evidenced by this Security
Certificate. The Company covenants and agrees, and the Holder, by his acceptance
hereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
The Holder of this Security Certificate, by his acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Securities evidenced hereby on his behalf as his
attorney-in-fact, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform his obligations under such Purchase Contracts,
consents to the provisions of the Purchase Contract Agreement, authorizes the
Agent to enter into and perform the Pledge Agreement on his behalf as his
attorney-in-fact, and consents to the Pledge of the Treasury Notes underlying
this Security Certificate pursuant to the Pledge Agreement. The Holder further
covenants and agrees, that, to the extent and in the manner
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<PAGE>
provided in the Purchase Contract Agreement and the Pledge Agreement, but
subject to the terms thereof, payments in respect of principal of the Treasury
Notes on the Final Settlement Date shall be paid by the Collateral Agent to the
Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of at least 66-2/3% of
the Outstanding Securities.
All terms used herein which are defined in the Purchase Contract Agreement
have the meanings set forth therein.
The Purchase Contracts shall for all purposes be governed by, and construed
in accordance with, the laws of the State of New York.
The Company, the Agent and any agent of the Company or the Agent may treat
the Person in whose name this Security Certificate is registered as the owner of
the Securities evidenced hereby for the purpose of receiving payments of
interest on the Treasury Notes, receiving payments of Contract Fees, performance
of the Purchase Contracts and for all other purposes whatsoever, whether or not
any payments in respect thereof be overdue and notwithstanding any notice to the
contrary, and neither the Company, the Agent nor any such agent shall be
affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof, entitle
the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection at
the offices of the Agent.
-8-
<PAGE>
Settlement Instructions
-----------------------
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Final Settlement Date of the
Purchase Contracts underlying the number of Securities evidenced by this
Security Certificate be registered in the name of, and delivered, together with
a check in payment for any fractional share, to the undersigned at the address
indicated below unless a different name and address have been indicated below.
If shares are to be registered in the name of a Person other than the
undersigned, the undersigned will pay any transfer tax payable incident thereto.
Dated: _________________ _________________________
Signature
If shares are to be REGISTERED HOLDER
registered in the name of
and delivered to a Person
other than the Holder,
please print such Person's
name and address:
Please print name and
address of Registered
Holder:
___________________________
Name
___________________________ ___________________________
Address Name
___________________________ ___________________________
Address
___________________________ ___________________________
Social Security or other
Taxpayer Identification
Number, if any ___________________________
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<PAGE>
Election to Settle Early
------------------------
The undersigned Holder of this Security Certificate hereby irrevocably
exercises the option to effect Early Settlement in accordance with the terms of
the Purchase Contract Agreement with respect to the Purchase Contracts
underlying the number of Securities evidenced by this Security Certificate
specified below. The option to effect Early Settlement may be exercised only
with respect to Purchase Contracts underlying Securities with an aggregate
Stated Amount equal to $________ or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon such Early Settlement be registered in the name of, and
delivered, together with a check in payment for any fractional share and any
Security Certificate representing any Securities evidenced hereby as to which
Early Settlement of the related Purchase Contracts is not effected, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. Treasury Notes deliverable upon such Early Settlement
will be transferred in accordance with the transfer instructions set forth
below. If shares are to be registered in the name of a Person other than the
undersigned, the undersigned will pay any transfer tax payable incident thereto.
Dated: _________________ _________________________
Signature
-10-
<PAGE>
Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected: __________.
If shares or Security REGISTERED HOLDER
Certificates are to be
registered in the name of
and delivered to and
Treasury Notes are to be
transferred to a Person
other than the Holder, Please print name and
please print such Person's address of Registered
name and address: Holder:
___________________________ ___________________________
Name Name
___________________________ ___________________________
Address Address
___________________________ ___________________________
___________________________ ___________________________
Social Security or other
Taxpayer Identification
Number, if any
______________________________________
Transfer Instructions for Treasury Notes Transferable Upon Early
Settlement or a Termination Event:
______________________________________________
______________________________________________
______________________________________________
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<PAGE>
Exhibit 4.7
PLEDGE AGREEMENT
----------------
PLEDGE AGREEMENT, dated as of __________, 199_ (this "Agreement"),
among Alco Standard Corporation, an Ohio corporation (the "Company"),
______________________ as collateral agent (in such capacity, together with its
successors in such capacity, the "Collateral Agent"), and ___________________
___________________, as purchase contract agent and as attorney-in-fact of the
Holders (as hereinafter defined) from time to time of the Securities (as
hereinafter defined) (in such capacity, together with its successors in such
capacity, the "Purchase Contract Agent") under the Purchase Contract Agreement
(as hereinafter defined).
RECITALS
The Company and the Purchase Contract Agent are parties to the
Purchase Contract Agreement, dated as of the date hereof (as modified and
supplemented and in effect from time to time, the "Purchase Contract
Agreement"), pursuant to which there will be issued ____% Automatic Common
Exchanged Securities (the "Securities").
Each Security consists of (a) one Purchase Contract (as hereinafter
defined) and (b) __% United States Treasury Notes due ___________, 199_
("Treasury Notes") having a principal amount equal to $__________ (the "Stated
Amount") and maturing on __________, 1998 (the "Final Settlement Date"), subject
to the pledge of such Treasury Notes created hereby.
Pursuant to the terms of the Purchase Contract Agreement and the
Purchase Contracts, the Holders (as defined in the Purchase Contract Agreement)
from time to time of the Securities have irrevocably authorized the Purchase
Contract Agent, as attorney-in-fact of such Holders, among other things to
execute and deliver this Agreement on behalf of such Holders and to grant the
pledge provided hereby of the Treasury Notes constituting part of such
Securities as provided herein and subject to the terms hereof.
Accordingly, the Company, the Collateral Agent and the Purchase
Contract Agent, on its own behalf and as attorney-in-fact of the Holders from
time to time of the Securities, agree as follows:
Section 1. Definitions. For all purposes of this Agreement, except
-----------
as otherwise expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular; and
(2) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision.
"Act" has the meaning specified in the Purchase Contract Agreement.
"Agreement" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
<PAGE>
"Applicable Treasury Regulations" means Subpart O-Book-Entry
Procedure of Title 31 of the Code of Federal Regulations (31 CFR (S) 306.115 et.
seq.) and any other regulations of the United States Treasury Department from
time to time applicable to the transfer or pledge of book-entry U.S. Treasury
Securities.
"Automatic Termination Event" has the meaning specified in the
Purchase Contract Agreement.
"Board Resolution" has the meaning specified in the Purchase Contract
Agreement.
"Business Day" means any day that is not a Saturday, a Sunday or a day
on which the New York Stock Exchange or banking institutions or trust companies
in The City of New York are authorized or obligated by law or executive order to
be closed.
"Collateral Agent" has the meaning specified in the first paragraph of
this instrument.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such, and
thereafter "Company" shall mean such successor.
"Early Settlement" has the meaning specified in the Purchase Contract
Agreement.
"Early Settlement Amount" has the meaning specified in the Purchase
Contract Agreement.
"Final Settlement Date" has the meaning specified in the Recitals.
"Holder" when used with respect to a Security, or a Purchase Contract
constituting a part thereof, has the meaning specified in the Purchase Contract
Agreement.
"Opinion of Counsel" has the meaning specified in the Purchase
Contract Agreement.
"Optional Termination Event" has the meaning specified in the Purchase
Contract Agreement.
"Outstanding Securities" has the meaning specified in the Purchase
Contract Agreement.
"Outstanding Security Certificates" has the meaning specified in the
Purchase Contract Agreement.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pledge" has the meaning specified in Section 2 hereof.
"Pledged Treasury Notes" has the meaning specified in Section 2
hereof.
"Purchase Contract" has the meaning specified in the Purchase Contract
Agreement.
"Purchase Contract Agent" has the meaning specified in the first
paragraph of this instrument.
"Security" has the meaning specified in the Recitals.
"Security Certificate" has the meaning specified in the Purchase
Contract Agreement.
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<PAGE>
"Stated Amount" has the meaning specified in the Recitals.
"Treasury Notes" has the meaning specified in the Recitals.
Section 2. The Pledge. The Holders from time to time of the
----------
Securities acting through the Purchase Contract Agent, as their attorney-in-
fact, hereby pledge and grant to the Collateral Agent, as collateral security
for the performance when due by such Holders of their respective obligations
under the Purchase Contracts constituting part of such Securities, for the
benefit of the Company, a security interest in all of the right, title and
interest of such Holders in the Treasury Notes constituting a part of such
Securities. Prior to or concurrently with the execution and delivery of this
Agreement, the initial Holders and the Collateral Agent shall (i) cause the
Treasury Notes to be delivered to the Collateral Agent by Federal Reserve Bank-
Wire to the account of the Collateral Agent designated by it for such purpose
and (ii) take appropriate action so that the applicable Federal Reserve Bank
through which such Treasury Notes have been purchased will reflect such transfer
and the Pledge by appropriate entries in its records in accordance with
Applicable Treasury Regulations. In addition, the execution and delivery hereof
by the Purchase Contract Agent and the Collateral Agent shall constitute (i) the
notification to the Collateral Agent (as bailee or otherwise) of the Pledge and
(ii) an acknowledgment by the Collateral Agent (as third party in possession or
otherwise) of the Pledge and of its holding of such Treasury Notes subject to
the Pledge, in each case, for purposes of perfecting the Pledge under Applicable
Treasury Regulations and other applicable law, including, to the extent
applicable, the Uniform Commercial Code as adopted and in effect in any
applicable jurisdiction. The pledge provided in this Section 2 is herein
referred to as the "Pledge" and the Treasury Notes subject to the Pledge,
excluding any Treasury Notes released from the Pledge as provided in Section 4
hereof, are hereinafter referred to as the "Pledged Treasury Notes." Subject to
the Pledge, the Holders from time to time of the Securities shall have full
beneficial ownership of the Treasury Notes constituting a part of such
Securities.
Section 3. Distribution of Principal and Interest. (a) All payments
--------------------------------------
of principal of, or interest on, any Treasury Notes constituting part of the
Securities received by the Collateral Agent shall be paid by the Collateral
Agent by wire transfer in same day funds no later than ____________, New York
City time on the Business Day such interest payment is received by the
Collateral Agent (provided that in the event such interest payment is received
by the Collateral Agent on a day that is not a Business Day or after
____________, New York City time, on a Business Day, then such payment shall be
made no later than ____________, New York City time, on the next succeeding
Business Day) (i) in the case of (A) interest payments and (B) any principal
payments with respect to any Treasury Notes that have been released from the
Pledge pursuant to Section 4 hereof, to the Purchase Contract Agent to the
account designated by it for such purpose and (ii) in the case of principal
payments on any Pledged Treasury Notes, to the Company, in full satisfaction of
the respective obligations of the Holders of the Securities of which such
Pledged Treasury Notes are a part under the Purchase Contracts forming a part of
such Securities. All such payments received by the Purchase Contract Agent as
provided herein shall be applied by the Purchase Contract Agent pursuant to the
provisions of the Purchase Contract Agreement. If, notwithstanding the
foregoing, the Purchase Contract Agent shall receive any payments of principal
on account of any Pledged Treasury Notes, the Purchase Contract Agent shall hold
the same as trustee of an express trust for the benefit of the Company (and
promptly deliver over to the Company) for application to the obligations of the
Holders of the Securities of which such Treasury Notes are a part under the
Purchase Contracts relating to the Securities of which such Treasury Notes are a
part, and such Holders shall acquire no right, title or interest in any such
payments of principal so received.
Section 4. Release of Pledged Treasury Notes.
---------------------------------
(a) Upon notice to the Collateral Agent by the Company or the Purchase Contract
Agent that (i) there has occurred, an Automatic Termination Event, the
Collateral Agent shall release all Pledged Treasury Notes from the Pledge and
shall transfer all such Treasury Notes, free and clear of any lien, pledge or
security interest created hereby, to the Purchase Contract Agent or (ii) one or
more Holders of Securities have, upon the occurrence of an Optional Termination
Event, elected to terminate the Purchase Contracts forming a part of such
Securities in accordance with the terms of the Purchase Contract and the
Purchase Contract Agreement and that all conditions to such termination have
been satisfied, then the Collateral Agent shall release from the Pledge Pledged
Treasury Notes with a principal amount equal to the product of (A) the
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<PAGE>
Stated Amount times (B) the number of such Purchase Contracts as to which such
-----
Holders have elected to such termination.
(b) Upon notice to the Collateral Agent by the Purchase Contract
Agent that one or more Holders of Securities have elected to effect Early
Settlement of their respective obligations under the Purchase Contracts forming
a part of such Securities in accordance with the terms of the Purchase Contracts
and the Purchase Contract Agreement, and that the Purchase Contract Agent has
received from such Holders, and paid to the Company, the related Early
Settlement Amounts pursuant to the terms of the Purchase Contracts and the
Purchase Contract Agreement and that all conditions to such Early Settlement
have been satisfied, then the Collateral Agent shall release from the Pledge
Pledged Treasury Notes with a principal amount equal to the product of (i) the
Stated Amount times (ii) the number of such Purchase Contracts as to which such
-----
Holders have elected to effect Early Settlement.
(c) Transfers of Treasury Notes pursuant to Section 4(a) or (b) shall
be by Federal Reserve Bank-Wire or in another appropriate manner, (i) if the
Collateral Agent shall have received such notification at or prior to
____________, New York City time, on a Business Day, then no later than
____________, New York City time, on such Business Day and (ii) if the
Collateral Agent shall have received such notification on a day that is not a
Business Day or after ____________, New York City time, on a Business Day, then
no later than ____________, New York City time, on the next succeeding Business
Day.
Section 5. Rights and Remedies. (a) The Collateral Agent shall have
-------------------
all of the rights and remedies with respect to the Pledged Treasury Notes of a
secured party under the Uniform Commercial Code as in effect in the State of New
York (the "Code") (whether or not said Code is in effect in the jurisdiction
where the rights and remedies are asserted) and such additional rights and
remedies to which a secured party is entitled under the laws in effect in any
jurisdiction where any rights and remedies hereunder may be asserted.
(b) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments to the Company on account of principal payments of any Pledged
Treasury Notes as provided in Section 3 hereof in satisfaction of the
obligations of the Holder of the Securities of which such Pledged Treasury Notes
are a part under the Purchase Contracts forming a part of such Securities, the
Collateral Agent shall have and may exercise, with reference to such Pledged
Treasury Notes and such obligations of such Holder, any and all of the rights
and remedies available to a secured party under the Code after default by a
debtor, and as otherwise granted herein or under any other law.
(c) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of principal of or interest on
the Pledged Treasury Notes.
(d) The Purchase Contract Agent agrees that, from time to time, upon
the written request of the Collateral Agent, the Purchase Contract Agent shall
execute and deliver such further documents and do such other acts and things as
the Collateral Agent may reasonably request in order to maintain the Pledge, and
the perfection and priority thereof, and to confirm the rights of the Collateral
Agent hereunder.
Section 6. The Collateral Agent. The Collateral Agent and the
--------------------
Company hereby agree between themselves as follows (it being understood and
agreed that neither the Purchase Contract Agent nor any Holder of Securities
shall have any rights under this Section 6):
6.01. Appointment, Powers and Immunities. The Collateral Agent shall
----------------------------------
act as agent for the Company hereunder with such powers as are specifically
vested in the Collateral Agent by the terms of this Agreement, together with
such other powers as are reasonably incidental thereto. The Collateral Agent:
(a) shall have no duties or responsibilities except those expressly set forth in
this Agreement and no implied covenants or obligations shall be inferred from
this Agreement against the Collateral Agent, nor shall the Collateral Agent be
bound by the provisions of any agreement by any party hereto beyond the
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<PAGE>
specific terms hereof; (b) shall not be responsible to the Company for any
recitals contained in this Agreement, or in any certificate or other document
referred to or provided for in, or received by it under, this Agreement, the
Securities or the Purchase Contract Agreement, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement
(other than as against the Collateral Agent), the Securities or the Purchase
Contract Agreement or any other document referred to or provided for herein or
therein or for any failure by the Company or any other Person (except the
Collateral Agent) to perform any of its obligations hereunder or thereunder; (c)
shall not be required to initiate or conduct any litigation or collection
proceedings hereunder (except pursuant to directions furnished under Section
6.02 hereof); (d) shall not be responsible for any action taken or omitted to be
taken by it hereunder or under any other document or instrument referred to or
provided for herein or in connection herewith or therewith, except for its own
negligence; and (e) shall not be required to advise any party as to selling or
retaining, or taking or refraining from taking any action with respect to, any
securities or other property deposited hereunder. Subject to the foregoing,
during the term of this Agreement the Collateral Agent shall take all reasonable
action in connection with the safe keeping and preservation of the Pledged
Treasury Notes hereunder.
No provision of this Agreement shall require the Collateral Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder. In no event shall the Collateral
Agent be liable for any amount in excess of the value of the Pledged Treasury
Notes.
6.02. Instructions of the Company. The Company shall have the right,
---------------------------
by one or more instruments in writing executed and delivered to the Collateral
Agent, to direct the time, method and place of conducting any proceeding for any
right or remedy available to the Collateral Agent, or of exercising any power
conferred on the Collateral Agent, or to direct the taking or refraining from
taking of any action authorized by this Agreement; provided, however, that (i)
-------- -------
such direction shall not conflict with the provisions of any law or of this
Agreement and (ii) the Collateral Agent shall be adequately indemnified as
provided herein. Nothing in this Section 6.02 shall impair the right of the
Collateral Agent in its discretion to take any action or omit to take any action
which it deems proper and which is not inconsistent with such direction.
6.03. Reliance by Collateral Agent. The Collateral Agent shall be
----------------------------
entitled to rely upon any certification, order, judgment, opinion, notice or
other communication (including, without limitation, any thereof by telephone,
telecopy, telex, telegram or cable) believed by it to be genuine and correct and
to have been signed or sent by or on behalf of the proper Person or Persons
(without being required to determine the correctness of any fact stated
therein), and upon advice and statements of legal counsel and other experts
selected by the Collateral Agent. As to any matters not expressly provided for
by this Agreement, the Collateral Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder in accordance with instructions
given by the Company in accordance with this Agreement.
6.04. Rights in Other Capacities. The Collateral Agent and its
--------------------------
affiliates may (without having to account therefor to the Company) accept
deposits from, lend money to, make investments in and generally engage in any
kind of banking, trust or other business with the Purchase Contract Agent and
any Holder of Securities (and any of their subsidiaries or affiliates) as if it
were not acting as the Collateral Agent, and the Collateral Agent and its
affiliates may accept fees and other consideration from the Purchase Contract
Agent and any Holder of Securities without having to account for the same to the
Company, provided that the Collateral Agent covenants and agrees with the
--------
Company that the Collateral Agent shall not accept, receive or permit there to
be created in its favor any security interest, lien or other encumbrance of any
kind in or upon the Pledged Treasury Notes.
6.05. Non-Reliance on Collateral Agent. The Collateral Agent shall
--------------------------------
not be required to keep itself informed as to the performance or observance by
the Purchase Contract Agent or any Holder of Securities of this Agreement, the
Purchase Contract Agreement, the Securities or any other document referred to or
provided for herein or therein or to inspect the properties or books of the
Purchase Contract Agent or any Holder of Securities. The Collateral Agent shall
not have any duty or responsibility to provide the Company with any credit or
other information concerning the affairs, financial condition or
-5-
<PAGE>
business of the Purchase Contract Agent or any Holder of Securities (or any of
their affiliates) that may come into the possession of the Collateral Agent or
any of its affiliates.
6.06. Compensation and Indemnity. The Company agrees: (i) to pay
--------------------------
the Collateral Agent from time to time reasonable compensation for all services
rendered by it hereunder and (ii) to indemnify the Collateral Agent for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of its powers and duties under this Agreement,
including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of such powers and
duties.
6.07. Failure to Act. In the event of any ambiguity in the
--------------
provisions of this Agreement or any dispute between or conflicting claims by or
among the undersigned and/or any other person or entity with respect to any
funds or property deposited hereunder, the Collateral Agent shall be entitled,
at its sole option, to refuse to comply with any and all claims, demands or
instructions with respect to such property or funds so long as such dispute or
conflict shall continue, and the Collateral Agent shall not be or become liable
in any way to any of the undersigned for its failure or refusal to comply with
such conflicting claims, demands or instructions. The Collateral Agent shall be
entitled to refuse to act until either (i) such conflicting or adverse claims or
demands shall have been finally determined by a court of competent jurisdiction
or settled by agreement between the conflicting parties as evidenced in a
writing, satisfactory to the Collateral Agent or (ii) the Collateral Agent shall
have received security or an indemnity satisfactory to the Collateral Agent
sufficient to save the Collateral Agent harmless from and against any and all
loss, liability or expense which the Collateral Agent may incur by reason of its
acting. The Collateral Agent may in addition elect to commence an interpleader
action or seek other judicial relief or orders as the Collateral Agent may deem
necessary. Notwithstanding anything contained herein to the contrary, the
Collateral Agent shall not be required to take any action that is in its opinion
contrary to law or to the terms of this Agreement, or which would in its opinion
subject it or any of its officers, employees or directors to liability.
6.08. Resignation of Collateral Agent. Subject to the appointment
-------------------------------
and acceptance of a successor Collateral Agent as provided below, (a) the
Collateral Agent may resign at any time by giving notice thereof to the Company
and the Purchase Contract Agent, (b) the Collateral Agent may be removed at any
time by the Company and (c) if the Collateral Agent fails to perform any of its
material obligations hereunder in any material respect for a period of not less
than 20 days after receiving notice of such failure by the Purchase Contract
Agent and such failure shall be continuing, the Collateral Agent may be removed
by the Purchase Contract Agent. The Purchase Contract Agent shall promptly
notify the Company of any removal of the Collateral Agent pursuant to clause (c)
of the immediately preceding sentence. Upon any such resignation or removal,
the Company shall have the right to appoint a successor Collateral Agent. If no
successor Collateral Agent shall have been so appointed and shall have accepted
such appointment within 30 days after the retiring Collateral Agent's giving of
notice of resignation or such removal, then the retiring Collateral Agent may
petition any court of competent jurisdiction for the appointment of a successor
Collateral Agent. The Collateral Agent shall be a bank which has an office in
New York, New York with a combined capital and surplus of at least $50,000,000.
Upon the acceptance of any appointment as Collateral Agent hereunder by a
successor Collateral Agent, such successor Collateral Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Collateral Agent, and the retiring Collateral Agent shall take
all appropriate action to transfer any money and property held by it hereunder
(including the Pledged Treasury Notes) to such successor Collateral Agent. The
retiring Collateral Agent shall, upon such succession, be discharged from its
duties and obligations as Collateral Agent hereunder. After any retiring
Collateral Agent's resignation hereunder as Collateral Agent, the provisions of
this Section 6 shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as the Collateral
Agent. Promptly following the removal or resignation of the Collateral Agent
the Company shall give written notice thereof to Moody's Investors Services,
Inc.
-6-
<PAGE>
6.09. Right to Appoint Agent or Advisor. The Collateral Agent shall
---------------------------------
have the right to appoint agents or advisors in connection with any of its
duties hereunder, and the Collateral Agent shall not be liable for any action
taken or omitted by such agents or advisors selected in good faith.
The provisions of this Section 6 shall survive termination of this Agreement
and the resignation or removal of the Collateral Agent.
Section 7. Amendment.
---------
7.01. Amendment Without Consent of Holders. Without the consent of
------------------------------------
any Holders, the Company, the Collateral Agent and the Purchase Contract Agent,
at any time and from time to time, may amend this Agreement, in form
satisfactory to the Company, the Collateral Agent and the Purchase Contract
Agent, for any of the following purposes:
(1) to evidence the succession of another Person to the Company, and
the assumption by any such successor of the covenants of the Company; or
(2) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the
Company; or
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Collateral Agent or Purchase Contract Agent; or
(4) to cure any ambiguity, to correct or supplement any provisions
herein which may be inconsistent with any other such provisions herein, or
to make any other provisions with respect to such matters or questions
arising under this Agreement, provided such action shall not adversely
--------
affect the interests of the Holders.
7.02. Amendment with Consent of Holders. With the consent of the
---------------------------------
Holders of not less than 66 2/3% of the Outstanding Securities, by Act of said
Holders delivered to the Company, the Agent and the Collateral Agent, the
Company, when authorized by a Board Resolution, the Agent and the Collateral
Agent may amend this Agreement for the purpose of modifying in any manner the
provisions of this Agreement or the rights of the Holders in respect of the
Securities; provided, however, that no such supplemental agreement shall,
-------- -------
without the consent of the Holder of each Outstanding Security affected thereby,
(1) change the amount or type of Treasury Notes underlying a
Security, impair the right of the Holder of any Security to receive
interest payments on the underlying Treasury Notes or otherwise adversely
affect the Holder's rights in or to such Treasury Notes; or
(2) otherwise effect any action that would require the consent of the
Holder of each Outstanding Security affected thereby pursuant to the
Purchase Contract Agreement if such action were effected by an agreement
supplemental thereto; or
(3) reduce the percentage of Outstanding Securities the consent of
whose Holders is required for any such amendment.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed amendment, but it shall be
sufficient if such Act shall approve the substance thereof.
7.03. Execution of Amendments. In executing any amendment permitted
-----------------------
by this Section, the Collateral Agent and the Purchase Contract Agent shall be
entitled to receive and (subject to Section 6.01 hereof, with respect to the
Collateral Agent, and Section 701 of the Purchase Contract Agreement, with
respect to the Purchase Contract Agent) shall be fully protected in relying
upon, an
-7-
<PAGE>
Opinion of Counsel stating that the execution of such amendment is authorized or
permitted by this Agreement.
7.04. Effect of Amendments. Upon the execution of any amendment
--------------------
under this Section, this Agreement shall be modified in accordance therewith,
and such amendment shall form a part of this Agreement for all purposes; and
every Holder of Security Certificates theretofore or thereafter authenticated,
executed on behalf of the Holders and delivered under the Purchase Contract
Agreement shall be bound thereby.
7.05. Reference to Amendments. Security Certificates authenticated,
-----------------------
executed on behalf of the Holders and delivered after the execution of any
amendment pursuant to this Section may, and shall if required by the Collateral
Agent or the Purchase Contract Agent, bear a notation in form approved by the
Purchase Contract Agent and the Collateral Agent as to any matter provided for
in such amendment. If the Company shall so determine, new Security Certificates
so modified as to conform, in the opinion of the Collateral Agent, the Purchase
Contract Agent and the Company, to any such amendment may be prepared and
executed by the Company and authenticated, executed on behalf of the Holders and
delivered by the Purchase Contract Agent in accordance with the Purchase
Contract Agreement in exchange for Outstanding Security Certificates.
Section 8. Miscellaneous.
-------------
8.01. No Waiver. No failure on the part of the Collateral Agent or
---------
any of its agents to exercise, and no course of dealing with respect to, and no
delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise by the Collateral Agent
or any of its agents of any right, power or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other right, power or remedy.
The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
8.02. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
-------------
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. The Company,
the Collateral Agent and the Holders from time to time of the Securities, acting
through the Purchase Contract Agent as their attorney-in-fact, hereby submit to
the nonexclusive jurisdiction of the United States District Court for the
Southern District of New York and of any New York state court sitting in New
York City for the purposes of all legal proceedings arising out of or relating
to this Agreement or the transactions contemplated hereby. The Company, the
Collateral Agent and the Holders from time to time of the Securities, acting
through the Purchase Contract Agent as their attorney-in-fact, irrevocably
waive, to the fullest extent permitted by applicable law, any objection which
they may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum.
8.03. Notices. All notices, requests, consents and other
-------
communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be given
or made in writing (including, without limitation, by telecopy) delivered to the
intended recipient at the "Address for Notices" specified below its name on the
signature pages hereof or, as to any party, at such other address as shall be
designated by such party in a notice to the other parties. Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when transmitted by telecopier or personally delivered or, in the
case of a mailed notice, upon receipt, in each case given or addressed as
aforesaid.
8.04. Successors and Assigns. This Agreement shall be binding upon
----------------------
and inure to the benefit of the respective successors and assigns of the
Company, the Collateral Agent and the Purchase Contract Agent, and the Holders
from time to time of the Securities, by their acceptance of the same, shall be
deemed to have agreed to be bound by the provisions hereof and to have ratified
the agreements of, and the grant of the Pledge hereunder by, the Purchase
Contract Agent.
-8-
<PAGE>
8.05. Counterparts. This Agreement may be executed in any number of
------------
counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
8.06. Severability. If any provision hereof is invalid and
------------
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in order to carry out the
intentions of the parties hereto as nearly as may be possible and (ii) the
invalidity or unenforceability of any provision hereof in any jurisdiction shall
not affect the validity or enforceability of such provision in any other
jurisdiction.
8.07. Expenses, etc. The Company agrees to reimburse the Collateral
--------------
Agent for: (a) all reasonable out-of-pocket costs and expenses of the
Collateral Agent (including, without limitation, the reasonable fees and
expenses of counsel to the Collateral Agent), in connection with (i) the
negotiation, preparation, execution and delivery or performance of this
Agreement and (ii) any modification, supplement or waiver of any of the terms of
this Agreement; (b) all reasonable costs and expenses of the Collateral Agent
(including, without limitation, reasonable fees and expenses of counsel) in
connection with (i) any enforcement or proceedings resulting or incurred in
connection with causing any Holder of Securities to satisfy its obligations
under the Purchase Contracts forming a part of the Securities and (ii) the
enforcement of this Section 8.07; and (c) all transfer, stamp, documentary or
other similar taxes, assessments or charges levied by any governmental or
revenue authority in respect of this Agreement or any other document referred to
herein and all costs, expenses, taxes, assessments and other charges incurred in
connection with any filing, registration, recording or perfection of any
security interest contemplated hereby.
8.08. Security Interest Absolute. All rights of the Collateral Agent
--------------------------
and security interests hereunder, and all obligations of the Holders from time
to time of the Securities hereunder, shall be absolute and unconditional
irrespective of:
(a) any lack of validity or enforceability of any provision
of the Purchase Contracts or the Securities or any other agreement or
instrument relating thereto;
(b) any change in the time, manner or place of payment of,
or any other term of, or any increase in the amount of, all or any of
the obligations of Holders of Securities under the related Purchase
Contracts, or any other amendment or waiver of any term of, or any
consent to any departure from any requirement of, the Purchase
Contract Agreement or any Purchase Contract or any other agreement or
instrument relating thereto; or
(c) any other circumstance which might otherwise constitute a
defense available to, or discharge of, a borrower, a guarantor or a
pledgor.
-9-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
ALCO STANDARD CORPORATION
By:________________________________
Name:
Title:
Address for Notices:
Alco Standard Corporation
P.O. Box 834
Valley Forge, Pennsylvania 19482
Attention: _________________
Telecopy: (610) 296-8000
___________________________________
as Purchase Contract Agent and as
attorney-in-fact of the Holders
from time to time of the Securities
By:________________________________
Name:
Title:
Address for Notices:
___________________________________
___________________________________
Attention: _______________________
__________________________________,
as Collateral Agent
By:________________________________
Name:
Title:
Address for Notices:
___________________________________
___________________________________
Attention: ________________________
-10-
<PAGE>
Exhibit 5
[Letterhead of Alco Standard Corporation]
November 14, 1995
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
I am General Counsel of Alco Standard Corporation, an Ohio corporation
("Alco"), and have acted as Counsel to Alco in connection with Alco's shelf
registration under the Securities Act of 1933, as amended (the "Act"), on
Form S-3 (the "Registration Statement") of debt securities (the "Debt
Securities"), serial preferred stock (the "Preferred Stock"), depositary shares
representing fractional interests in shares of the Preferred Stock (the
"Depositary Shares") and common stock, no par value (the "Common Stock") to be
issued from time to time in an aggregate amount not to exceed $750,000,000. In
such connection, I have reviewed such documents and made such investigation as I
have deemed necessary under the circumstances to render the following opinion.
On the basis of such review and investigation, it is my opinion that:
(1) With respect to the Common Stock, when the Registration Statement has
become effective under the Act, the terms of the sale of the Common Stock have
been duly established in conformity with Alco's Articles of Incorporation, and
the Common Stock has been issued and sold as contemplated by the Registration
Statement, the Common Stock will be validly issued, fully paid and
nonassessable;
(2) With respect to the Preferred Stock, when the Registration Statement
has become effective under the Act, a Certificate of Amendment to the Articles
of Incorporation with respect to the Preferred Stock has been filed with the
Secretary of State of the State of Ohio, the terms of the Preferred Stock and of
their issue and sale have been duly established in conformity with Alco's
Articles of Incorporation so as not to violate any applicable law or result in a
default under or breach of any agreement or instrument binding upon Alco and so
as to comply with any requirement or restriction imposed by any court or
governmental body having
<PAGE>
Securities and Exchange Commission
Page 2
November 14, 1995
jurisdiction over Alco, and the Preferred Stock has been duly issued and sold as
contemplated by the Registration Statement, the Preferred Stock will be validly
issued, fully paid and nonassessable, and any Common Stock issuable upon
conversion of the Preferred Stock, when duly issued upon conversion thereof,
will be validly issued, fully paid and nonassessable;
(3) With respect to the Depositary Shares, when the Registration Statement
has become effective under the Act, the Deposit Agreement relating to the
Depositary Shares has been duly authorized, executed and delivered, the terms of
the Depositary Shares and of their issuance and sale have been duly established
in conformity with the Deposit Agreement relating to the Depositary Shares so as
not to violate any applicable law or result in a default under or breach of any
agreement or instrument binding upon Alco and so as to comply with any
requirement or restriction imposed by any court or governmental body having
jurisdiction over Alco, and the Depositary Shares have been duly issued and sold
as contemplated in the Registration Statement, the Depositary Shares will be
validly issued and will entitle the holders thereof to the rights specified in
the Depositary Shares and in the Deposit Agreement, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles.
(4) With respect to the Debt Securities, when the Registration Statement
has become effective under the Act, the terms of the Debt Securities and of
their issuance and sale have been duly established in conformity with the
Indenture relating to the Debt Securities so as not to violate any applicable
law or result in a default under or breach of any agreement or instrument
binding upon Alco and so as to comply with any requirement or restriction
imposed by any court or governmental body having jurisdiction over Alco, and the
Debt Securities have been duly executed and authenticated in accordance with the
Indenture and issued and sold as contemplated in the Registration Statement, the
Debt Securities will constitute valid and legally binding obligations of Alco,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles, and any Common Stock
issuable upon conversion of the Debt Securities, when duly issued upon
conversion thereof, will be validly issued, fully paid and nonassessable.
(5) With respect to the Stock Purchase Contracts, when (i) Alco's Board of
Directors (the "Board") has taken all necessary corporate action to approve the
creation of and the issuance and terms of the Stock Purchase Contracts, the
terms of the offering thereof and related matters; and (ii) the Stock Purchase
Contracts have been duly authorized and validly executed and delivered by Alco
and the underwriters for such offering in accordance with the applicable
definitive purchase, underwriting or similar agreement approved by the Board
upon payment of the consideration provided for therein, the Stock Purchase
Contracts will be duly authorized and validly issued.
(6) With respect to the Stock Purchase Units, when (i) the Board has taken
all necessary corporate action to approve the creation of and the issuance and
terms of the Stock Purchase Units, the terms of the offering thereof and related
matters; (ii) the deposit agreement relating to the Stock Purchase Units has
been duly authorized and validly executed and delivered by Alco and the
depositary appointed by Alco; and (iii) the Stock Purchase Units or certificates
representing the Stock Purchase Units have been duly executed, countersigned,
registered and delivered in accordance with the appropriate depositary agreement
and the applicable definitive purchase, underwriting or similar agreement
approved by the Board upon payment of the consideration therefor provided for
therein, the Stock Purchase Units will be duly authorized and validly issued.
I hereby consent to the filing of this opinion as an exhibit to the
registration statement filed by Alco to effect such registration and the
reference to me therein
<PAGE>
Securities and Exchange Commission
Page 3
November 14, 1995
under the heading "Validity of Securities." In giving such consent, I do not
thereby admit that I am in the category of persons whose consent is required
under Section 7 of the Act.
Sincerely,
/s/ J. KENNETH CRONEY
----------------------
(J. Kenneth Croney)
<PAGE>
EXHIBIT 12
ALCO STANDARD CORPORATION AND SUBSIDIARIES
RATIO OF EARNINGS TO FIXED CHARGES
(dollars in thousands)
<TABLE>
<CAPTION>
--------------------------------------------------------------------
9/30/95 1994 1993 1992 1991
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Earnings
Income from continuing operations $ 219,273 $ 70,609 $ 7,615 $ 104,217 $ 76,642
Add:
Loss from unconsolidated affiliate 117,158 2,538
Provision for income taxes 140,630 86,203 16,984 68,303 49,160
Fixed charges 130,684 101,779 86,615 70,168 68,748
--------- --------- --------- --------- ---------
Earnings, as adjusted (A) $ 490,587 $ 375,749 $ 113,752 $ 242,688 $ 194,550
========= ========= ========= ========= =========
Fixed charges
Other interest expense, including
interest on capital leases $ 96,054 $ 71,780 $ 63,851 $ 51,203 $ 53,173
Estimated interest component of
rental expense 34,630 29,999 22,764 18,965 15,575
--------- --------- --------- --------- ---------
Total fixed charges (B) $ 130,684 $ 101,779 $ 86,615 $ 70,168 $ 68,748
========= ========= ========= ========= =========
Ratio of earnings to fixed charges
(A) divided by (B) 3.8 3.7 1.3 * 3.5 2.8
=== === === === ===
</TABLE>
* Excluding the effect of the restructuring costs, the ratio of earnings to
fixed charges for fiscal 1993 is 3.3.
<PAGE>
EXHIBIT 12.1
ALCO STANDARD CORPORATION AND SUBSIDIARIES
RATIO OF EARNINGS TO FIXED CHARGES (EXCLUDING CAPTIVE FINANCE SUBSIDIARIES)
(dollars in thousands)
<TABLE>
<CAPTION>
------------------------------------------------------------------
9/30/95 1994 1993 1992 1991
------------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Earnings
Income (loss) from continuing
operations $ 204,801 $ 57,262 $ 11,025 $ 98,162 $ 73,051
Add:
Loss from unconsolidated affiliate 117,158 2,538
Provision for income taxes 129,067 77,792 11,512 64,592 46,221
Fixed charges 90,468 73,751 62,535 50,595 52,951
---------- ---------- ---------- ---------- ----------
Earnings, as adjusted (A) $ 424,336 $ 325,963 $ 87,610 $ 213,349 $ 172,223
========== ========== ========== ========== ==========
Fixed charges
Other interest expense, including
interest on capital leases $ 55,838 $ 43,802 $ 40,189 $ 31,680 $ 37,426
Estimated interest component of
rental expense 34,630 29,949 22,346 18,915 15,525
---------- ---------- ---------- ---------- ----------
Total fixed charges (B) $ 90,468 $ 73,751 $ 62,535 $ 50,595 $ 52,951
========== ========== ========== ========== ==========
Ratio of earnings to fixed charges
(A) divided by (B) 4.7 4.4 1.4 * 4.2 3.3
=== === === === ===
</TABLE>
* Excluding the effect of the restructuring costs, the ratio of earnings to
fixed charges (excluding captive finance subsidiaries) for fiscal 1993 is
4.2.
<PAGE>
EXHIBIT 12.2
ALCO STANDARD CORPORATION AND SUBSIDIARIES
RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(dollars in thousands)
<TABLE>
<CAPTION>
------------------------------------------------------------------
9/30/95 1994 1993 1992 1991
---------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Earnings
Income from continuing operations $ 219,273 $ 70,609 $ 7,615 $ 104,217 $ 76,642
Add:
Loss from unconsolidated affiliate 117,158 2,538
Provision for income taxes 140,630 86,203 16,984 68,303 49,160
Fixed charges 130,684 101,779 86,615 70,168 68,748
---------- ---------- ---------- ---------- ----------
Earnings, as adjusted (A) $ 490,587 $ 375,749 $ 113,752 $ 242,688 $ 194,550
Fixed charges and preferred stock dividends
Other interest expense, including
interest on capital leases $ 96,054 $ 71,780 $ 63,851 $ 51,203 $ 53,173
Estimated interest component of
rental expense 34,630 29,999 22,764 18,965 15,575
---------- ---------- ---------- ---------- ----------
Total fixed charges 130,684 101,779 86,615 70,168 68,748
Preferred stock dividends, as adjusted 24,974 19,002 15,846 129 228
Total fixed charges and preferred ---------- ---------- ---------- ---------- ----------
stock dividends (B) $ 155,658 $ 120,781 $ 102,461 $ 70,297 $ 68,976
========== ========== ========== ========== ==========
Ratio of earnings to fixed charges
and preferred stock dividends
(A) divided by (B) 3.2 3.1 1.1 * 3.5 2.8
=== === === === ===
</TABLE>
* Excluding the effect of the restructuring costs, the ratio of earnings to
fixed charges and preferred stock dividends for fiscal 1993 is 2.8.
<PAGE>
EXHIBIT 12.3
ALCO STANDARD CORPORATION AND SUBSIDIARIES
RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(EXCLUDING CAPTIVE FINANCE SUBSIDIARIES)
(dollars in thousands)
<TABLE>
<CAPTION>
---------------------------------------------------------------------
9/30/95 1994 1993 1992 1991
---------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Earnings
Income (loss) from continuing
operations $ 204,801 $ 57,262 $ 11,025 $ 98,162 $ 73,051
Add:
Loss from unconsolidated affiliate 117,158 2,538
Provision for income taxes 129,067 77,792 11,512 64,592 46,221
Fixed charges 90,468 73,751 62,535 50,595 52,951
---------- ---------- ----------- ---------- ----------
Earnings, as adjusted (A) $ 424,336 $ 325,963 $ 87,610 $ 213,349 $ 72,223
========== ========== =========== ========== ==========
Fixed charges and preferred stock dividends
Other interest expense, including
interest on capital leases $ 55,838 $ 43,802 $ 40,189 $ 31,680 $ 37,426
Estimated interest component of
rental expense 34,630 29,949 22,346 18,915 15,525
---------- ---------- ----------- ---------- ----------
Total fixed charges 90,468 73,751 62,535 50,595 52,951
Preferred stock dividends, as adjusted 24,811 19,002 15,613 129 227
Total fixed charges and preferred ---------- ---------- ----------- ---------- ----------
stock dividends (B) $ 115,279 $ 92,753 $ 78,148 $ 50,724 $ 53,178
========== ========== =========== ========== ==========
Ratio of earnings to fixed charges
and preferred stock dividends
(A) divided by (B) 3.7 3.5 1.1 * 4.2 3.2
=== === === === ===
</TABLE>
* Excluding the effect of the restructuring costs, the ratio of earnings to
fixed charges and preferred stock dividends (excluding captive finance
subsidiaries) for fiscal 1993 is 3.4.
<PAGE>
Exhibit 23
Consent of Ernst & Young LLP, Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of Alco Standard
Corporation dated November 14, 1995 and to the incorporation by reference
therein of our report dated October 17, 1995, (except for the stock split
described in Note 1, as to which the date is November 9, 1995), with respect to
the consolidated financial statements and schedules of Alco Standard Corporation
included in its Annual Report (Form 10-K) for the year ended September 30, 1995,
filed with the Securities and Exchange Commission.
Philadelphia, Pennsylvania Ernst & Young LLP
November 14, 1995
<PAGE>
Exhibit 24
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/J. MAHLON BUCK, JR.
----------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/PAUL J. DARLING, II
------------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is Chief Financial Officer of Alco
Standard Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/KURT E. DINKELACKER
----------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/WILLIAM F. DRAKE, JR.
----------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/JAMES J. FORESE
----------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/FREDERICK S. HAMMER
----------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that she is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as her attorneys-in-fact, each with the power of
substitution, to execute, on her behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/BARBARA BARNES HAUPTFUHRER
-------------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/DANA G. MEAD
----------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/RAY B. MUNDT
----------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/PAUL C. O'NEILL
----------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/ROGELIO G. SADA
--------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/JAMES W. STRATTON
----------------------------
<PAGE>
POWER OF ATTORNEY
-----------------
The undersigned certifies that he is a Director of Alco Standard
Corporation ("Alco").
The undersigned hereby appoints each of Hugh G. Moulton, J. Kenneth Croney
and Michael J. Dillon as his attorneys-in-fact, each with the power of
substitution, to execute, on his behalf the foregoing registration statement on
Form S-3, for filing with the Securities and Exchange Commission ("SEC"), and to
execute any and all amendments to said registration statement, and to do all
such other acts and execute all such other documents which said attorney may
deem necessary or desirable.
Dated this 10th day of November, 1995.
SIGNED: /s/JOHN E. STUART
-----------------------
<PAGE>
Exhibit 24.1
CERTIFICATION
I, J. Kenneth Croney, Secretary of Alco Standard Corporation do hereby
certify that the following resolutions were duly passed by the Board of
Directors of the Corporation on November 10, 1995, and that such resolutions
are, as of the date hereof, in full force and effect:
RESOLVED, that each of the officers and directors of the corporation
is hereby authorized to appoint Hugh G. Moulton, J. Kenneth Croney and
Michael J. Dillon as his or her attorneys-in-fact on behalf of each of them
each attorney-in-fact with the power of substitution, to execute on such
officer's or director's behalf, one or more registration statements and
annual reports of the corporation for filing with the Securities and
Exchange Commission ("SEC"), and any and all amendments to said documents
which said attorney may deem necessary or desirable to enable the
corporation to register the offering of (i) serial preferred stock; (ii)
common stock; (iii) debt securities; and/or (iv) participation interest in
employee benefit plans under the Federal securities law, and to further
enable the corporation to file such reports as are necessary under Section
13 or 15(d) of the Securities Exchange Act of 1934 and such other documents
as are necessary to comply with all rules, regulations or requirements of
the SEC in respect thereto; and
FURTHER RESOLVED, that any officer of the corporation is hereby
authorized to do and perform, or cause to be done or performed, any and all
things and to execute and deliver any and all agreements, certificates,
undertakings, documents or instruments necessary or appropriate in order to
carry out the purpose and intent of the foregoing resolutions.
IN WITNESS WHEREOF, I have hereunto set my hand this 10th day of November,
1995.
/s/ J. KENNETH CRONEY
-------------------------------
(J. Kenneth Croney)
<PAGE>
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) ___
-------------------------
FIRST FIDELITY BANK, NATIONAL ASSOCIATION
(Name of Trustee)
22-1147033
(Jurisdiction of Incorporation or (I.R.S. Employer
Organization if not a U.S. National Bank) Identification No.)
101 NORTHSIDE PLAZA, ELKTON, MARYLAND 21921
(Address of Principal Executive Offices) (Zip Code)
-------------------------
ALCO STANDARD CORPORATION
(Name of Obligor)
OHIO 23-0334400
(State of Incorporation) (I.R.S. Employer
Identification No.)
P.O. BOX 834, VALLEY FORGE, PENNSYLVANIA 19482
(Address of Principal Executive Offices) (Zip Code)
-------------------------
DEBT SECURITIES
(Title of Indenture Securities)
<PAGE>
1. General information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervisory authority to which it
is subject:
Comptroller of the Currency
United States Department of the Treasury
Washington, D.C. 20219
Board of Governors of the Federal Reserve System
Washington, D.C.
Federal Deposit Insurance Corporation
Washington, D.C. 20429
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
3. List of Exhibits.
List below all exhibits filed as part of this statement of eligibility.
1. Copy of Articles of Association of the trustee as now in effect.
Incorporated herein by reference to Exhibit 1 filed with Form T-1,
Registration No. 22-73340.
2. Copy of Certificate of the Comptroller of the Currency dated January 11,
1994, evidencing the authority of the trustee to transact business.
Incorporated herein by reference to Exhibit 2 filed with Form T-1,
Registration No. 22-73340.
3. Copy of the authorization of the trustee to exercise corporate trust
powers has heretofore been filed with the Securities and Exchange
Commission as Exhibit 3 filed with Form T-1, Registration Number 22-
73340, has not been amended since filing and is incorporated herein by
reference.
4. Copy of existing by-laws of the trustee. Incorporated herein by
reference to Exhibit 4 filed with Form T-1, Registration No. 22-73340.
<PAGE>
2
5. Copy of each indenture if the obligor is in default.
Not applicable.
6. Consent of the trustee required by Section 321(b) of the Act.
Incorporated herein by reference to Exhibit 6 filed with Form T-1,
Registration No. 22-73340.
7. Copy of report of condition of the trustee at the close of business on
September 30, 1995, published pursuant to the requirements of its
supervising authority.
NOTE
The trustee disclaims responsibility for the accuracy or completeness of
information contained in this Statement of Eligibility and Qualification not
known to the trustee and not obtainable by it through reasonable investigation
and as to such information it has obtained from the obligor and has had to rely
or will obtain from the principal underwriters and will have to rely.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 (as
amended), the trustee, First Fidelity Bank, National Association, 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 Newark
and State of New Jersey on the 8th day of November, 1995.
FIRST FIDELITY BANK, NATIONAL
ASSOCIATION
By: /s/ Melissa Matthews
----------------------------------
Melissa Matthews
Vice President
ALCO(Form T1)
<PAGE>
3
EXHIBIT T-7
REPORT OF CONDITION
Consolidating domestic and foreign subsidiaries of the First Fidelity Bank,
National Association, at the close of business on September 30, 1995, published
in response to call made by Comptroller of the Currency, under title 12, United
States Code, Section 161. Charter Number 33869 Comptroller of the Currency
Northeastern District.
Statement of Resources and Liabilities
<TABLE>
<CAPTION>
ASSETS
Thousand of Dollars
-------------------
<S> <C>
Cash and balance due from depository institutions:
Noninterest-bearing balances and currency and coin.......... 1,503,341
Interest-bearing balances................................... 460,595
Securities.................................................... /////////
Hold-to-maturity securities................................. 3,431,427
Available-for-sale securities............................... 2,019,209
Federal funds sold and securities purchased under agreements //////////
to resell in domestic offices of the bank and of it //////////
Edge and Agreement subsidiaries, and in IBFs: //////////
Federal funds sold......................................... 425,000
Securities purchased under agreements to resell............ 355,567
Loans and lease financing receivables:
Loan and leases, net of unearned income......22,536,087
LESS: Allowance for loan and lease losses.......483,973
LESS: Allocated transfer risk reserve.................0
Loans and leases, net of unearned income, allowance, and
reserve.................................................... 22,052,114
Assets held in trading accounts............................... 152,832
Premises and fixed assets (including capitalized leases)...... 378,375
Other real estate owned....................................... 116,168
Investment in unconsolidated subsidiaries and associated //////////
companies..................................................... 18,165
Customer's liability to this bank on acceptances outstanding.. 176,233
Intangible assets............................................. 796,802
Other assets.................................................. 786,706
Total assets.................................................. 32,672,534
</TABLE>
LIABILITIES
<TABLE>
<CAPTION>
Deposits:
<S> <C> <C>
In domestic offices.......................................... 24,725,866
Noninterest-bearing..........................4,337,767
Interest-bearing............................20,388,099
In foreign offices, Edge and Agreement subsidiaries,
and IBFs..................................................... 1,253,399
Noninterest-bearing.............................13,416
Interest-bearing.............................1,239,983
Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of its
Edge and Agreement subsidiaries, and IBFs
Federal fund purchased....................................... 1,219,823
Securities sold under agreements to repurchase............... 1,108,011
Demand notes issued to the U.S. Treasury........................ 190,208
Trading liabilities............................................. 0
Other borrowed money:........................................... /////////
With original maturity of one year or less................... 75,481
</TABLE>
<PAGE>
<TABLE>
<S> <C>
With original maturity of more than one year................. 529
Mortgage indebtedness and obligations under capitalized leases 17,222
Bank's liability on acceptances executed and outstanding........ 176,425
Subordinated notes and debentures............................... 175,000
Other liabilities............................................... 633,215
Total liabilities............................................... 29,575,179
Limited-life preferred stock and related surplus................ 0
</TABLE>
EQUITY CAPITAL
<TABLE>
<S> <C>
Perpetual preferred stock and related surplus................ 0
Common Stock................................................. 452,156
Surplus...................................................... 1,300,080
Undivided profits and capital reserves....................... 1,189,821
Net unrealized holding gains (losses) on available-for-sale /////////
securities.................................................. (5,242)
Cumulative foreign currency translation adjustments.......... 0
Total equity capital......................................... 3,097,355
Total liabilities, limited-life preferred stock and equity... //////////
capital.................................................... 32,672,534
</TABLE>
