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As filed with the Securities and Exchange Commission on December 6, 1994
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(B) OR 12(G) OF THE
SECURITIES EXCHANGE ACT OF 1934
__________________
FIRST FINANCIAL MANAGEMENT CORPORATION
(Exact name of registrant as specified in its charter)
GEORGIA 58-1107864
------- ----------
(State of incorporation or (I.R.S. Employer Identification Number)
organization)
3 CORPORATE SQUARE, SUITE 700
ATLANTA, GEORGIA 30329
(Address, including zip code, of principal executive offices)
Securities to be registered pursuant to Section 12(b) of the Act:
Name of each exchange on which
Title of each class to be so registered each class is to be registered
- --------------------------------------- ------------------------------
5% SENIOR CONVERTIBLE
DEBENTURES DUE 1999 NEW YORK STOCK EXCHANGE
Securities to be registered pursuant to Section 12(g) of the Act: NONE
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Item 1. Description of Registrant's Securities to be Registered.
The 5% Senior Convertible Debentures due 1999 registered hereby are
described in "Description of Debentures" contained in Post-Effective
Amendment No. 1 to the Registrant's Registration Statement on Form
S-3 filed on December 6, 1994 (File No. 33-56327), which is hereby
incorporated by reference. As supplemental information, the general
description of debt securities issuable under such Registration
Statement on Form S-3 set forth in "Description of Debt Securities"
therein is also hereby incorporated by reference.
Item 2. Exhibits
1.0 "Description of Debentures" and "Description of Debt
Securities" as contained in Post-Effective Amendment No. 1 to
the Registrant's Registration Statement on Form S-3 filed on
December 6, 1994 (File No. 33-56327).
2.1 Restated Articles of Incorporation.*
2.2 Bylaws, as amended.**
2.3 Indenture, dated as of December 5, 1994, between the Registrant
and NationsBank of Georgia, National Association, as
Trustee.***
2.4 First Supplemental Indenture, dated as of December 5, 1994,
between the Registrant and NationsBank of Georgia, National
Association, as Trustee.****
______________
* Filed with the Commission as an exhibit to the Registrant's Quarterly Report
on Form 10-Q for the quarter ended March 31, 1994 and incorporated herein by
reference.
** Filed with the Commission as an exhibit to the Registrant's Quarterly Report
on Form 10-Q for the quarter ended September 30, 1993 and incorporated herein
by reference.
*** Filed with the Commission on December 5, 1994 as an exhibit to Amendment
No. 2 to the Registrant's Registration Statement on Form S-3 (File No.
33-56327) and incorporated herein by reference.
**** Filed with the Commission on December 6, 1994 as an exhibit to
Post-Effective Amendment No. 1 to the Registrant's Registration Statement on
Form S-3 (File No. 33-56327) and incorporated herein by reference.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this registration statement to be
signed on its behalf by the undersigned, thereto duly authorized.
FIRST FINANCIAL MANAGEMENT CORPORATION
Date: December 6, 1994 By: /s/ M. TARLTON PITTARD
-----------------------------
M. Tarlton Pittard,
Senior Executive Vice President,
Treasurer and Chief Financial Officer
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Exhibit 1.0
DESCRIPTION OF DEBENTURES
The Debentures will be issued under an Indenture (the "Original Indenture")
dated as of December 5, 1994 between the Company and NationsBank of Georgia,
National Association, as Trustee (the "Trustee"), as supplemented by the First
Supplemental Indenture (the "First Supplemental Indenture") dated as of December
5, 1994 between the Company and the Trustee (as so supplemented, the
"Indenture"). The following description of the particular Debentures offered
hereby supplements, and to the extent inconsistent therewith, replaces, the
description of the general terms and provisions of the Debt Securities set forth
in the Prospectus under the caption "Description of Debt Securities." The
Debentures will represent direct, unsecured general obligations of the Company,
convertible into Common Stock as described under "Conversion of Debentures." The
following statements are subject to the detailed provisions of the Indenture and
are qualified in their entirety by reference to the Indenture. References in
italics are to the Original Indenture and the First Supplemental Indenture, as
applicable. Wherever particular provisions of the Indenture are referred to,
such provisions are incorporated by reference as a part of the statements made,
and the statements are qualified in their entirety by such reference.
GENERAL
The Debentures will be direct, unsecured general obligations of the Company
and will rank on a parity with all other indebtedness of the Company which is
not by its terms subordinated to the Debentures. The Debentures will be limited
to $506,000,000 principal amount (including $66,000,000 subject to the
Underwriters' over-allotment option), will be issued in fully registered form
only in denominations of $1,000 or any multiple thereof, and will mature on
December 15, 1999. (Section 201 of the First Supplemental Indenture)
Interest at the annual rate set forth on the cover page of this Prospectus
Supplement is payable semiannually on June 15 and December 15, commencing June
15, 1995, to Holders of record at the close of business on the preceding June 1
and December 1, respectively, and, unless other arrangements are made, will be
paid by check mailed to such Holders. (Section 201 of the First Supplemental
Indenture)
Principal and premium, if any, will be payable, and the Debentures may be
presented for conversion, registration of transfer and exchange, without service
charge, at the Corporate Trust Office of the Trustee in Atlanta, Georgia.
(Sections 201 and 302 of the First Supplemental Indenture)
CONVERSION OF DEBENTURES
The Holders of Debentures will be entitled at any time prior to the close
of business on December 15, 1999, subject to prior redemption, to convert any
Debentures or portions thereof (in denominations of $1,000 or multiples thereof)
into Common Stock of the Company, at the conversion price set forth on the cover
page of this Prospectus Supplement, subject to adjustment as described below.
(Sections 301, 304, 305 and 306 of the First Supplemental Indenture) Except as
described below, no adjustment will be made on conversion of any Debenture for
interest accrued thereon or for dividends on any Common Stock issued upon such
conversion. (Section 302 of the First Supplemental Indenture) If any Debenture
not called for redemption is converted between a record date for the payment of
interest and the next succeeding Interest Payment Date, such Debenture must be
accompanied by funds equal to the interest payable on such succeeding Interest
Payment Date on the principal amount so converted. (Section 302 of the First
Supplemental Indenture) No such additional funds will be required for Debentures
called for redemption and converted. The Company is not required to issue
fractional shares of Common Stock upon conversion of Debentures and, in lieu
thereof, will pay a cash adjustment based upon the market price of the Common
Stock on the last Business Day prior to the date of conversion. (Section 303 of
the First Supplemental Indenture) In the case of Debentures called for
redemption, conversion rights will expire at the close of business on the
redemption date. (Sections 301 and 302 of the First Supplemental Indenture)
The initial conversion price of $69 per share of Common Stock is subject to
adjustment (under formulae set forth in the Indenture) in certain events,
including: (i) the issuance of Common Stock as a dividend or distribution on
Common Stock of the Company; (ii) subdivisions and combinations of the Common
Stock, (iii) the issuance to all holders of Common Stock of certain rights or
warrants to purchase Common Stock;
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(iv) the distribution to all holders of Common Stock of shares of capital stock
of the Company (other than Common Stock) or evidences of indebtedness of the
Company or assets (including securities, but excluding those rights, warrants,
dividends and distributions referred to above and dividends and distributions in
connection with the liquidation, dissolution or winding up of the Company or
paid in cash); (v) distributions consisting of cash, excluding any semiannual
cash dividend on the Common Stock to the extent that the aggregate cash dividend
per share of Common Stock in any semiannual period does not exceed the greater
of (x) the amount per share of Common Stock of the next preceding semiannual
cash dividend on the Common Stock to the extent that such preceding semiannual
dividend did not require an adjustment of the conversion price pursuant to this
clause (v) (as adjusted to reflect subdivisions or combinations of the Common
Stock), and (y) 7.5% of the average of the last reported sale prices of the
Common Stock for each of the ten consecutive Trading Days (as defined in the
First Supplemental Indenture) immediately prior to the date of declaration of
such dividend, and excluding any dividend or distribution in connection with the
liquidation, dissolution or winding up of the Company; and (vi) payment in
respect of a Tender Offer (as defined in the First Supplemental Indenture to
cover "traditional tender offers" as determined in good faith by the Company's
Board of Directors) or exchange offer by the Company or any subsidiary of the
Company to all holders of the Common Stock for the Common Stock to the extent
that the cash and value of any other consideration included in such payment per
share of Common Stock exceeds the Current Market Price (as defined in the First
Supplemental Indenture) per share of Common Stock on the Trading Day next
succeeding the last date on which tenders or exchanges may be made pursuant to
such tender or exchange. If any adjustment is required to be made as set forth
in clause (v) above as a result of a distribution that is a semiannual dividend,
such adjustment would be based upon the amount by which such distribution
exceeds the amount of the semiannual cash dividend permitted to be excluded
pursuant to such clause (v). If an adjustment is required to be made as set
forth in clause (v) above as a result of a distribution that is not a semiannual
dividend, such adjustment would be based upon the full amount of the
distribution. (Section 305 of the First Supplemental Indenture)
No adjustment in the conversion price will be required unless such
adjustment would require a change of at least 1% in the conversion price then in
effect; provided, that any adjustment that would otherwise be required to be
made shall be carried forward and taken into account in any subsequent
adjustment. The Company reserves the right to make such reductions in the
conversion price in addition to those required in the foregoing provisions as
the Company in its discretion shall determine to be advisable in order that
certain stock-related distributions hereafter made by the Company to its
shareholders shall not be taxable. (Section 305 of the First Supplemental
Indenture) Except as stated above, the conversion price will not be adjusted for
the issuance of Common Stock or any securities convertible into or exchangeable
for Common Stock, or carrying the right to purchase any of the foregoing.
In the case of (i) any reclassification or change of the Common Stock, or
(ii) a consolidation, merger, or combination involving the Company or a sale or
conveyance to another corporation of the property and assets of the Company as
an entirety or substantially as an entirety, in each case as a result of which
holders of Common Stock shall be entitled to receive stock, securities, or other
property or assets (including cash) with respect to or in exchange for such
Common Stock, the Holders of the Debentures then Outstanding will be entitled
thereafter to convert such Debentures into the kind and amount of shares of
stock, other securities or other property or assets which they would have owned
or been entitled to receive upon such reclassification, change, consolidation,
merger, combination, sale or conveyance had such Debentures been converted into
Common Stock immediately prior to such reclassification, change, consolidation,
merger, combination, sale or conveyance assuming that a Holder of Debentures
would not have exercised any rights of election as to the stock, other
securities or other property or assets receivable in connection therewith.
(Section 306 of the First Supplemental Indenture)
In the event of a taxable distribution to holders of Common Stock which
results in an adjustment of the conversion price, the Holders of Debentures may,
in certain circumstances, be deemed to have received a distribution subject to
United States income tax as a dividend; in certain other circumstances, the
absence of such an adjustment may result in a taxable dividend to the holders of
Common Stock.
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OPTIONAL REDEMPTION BY THE COMPANY
The Debentures are not redeemable at the option of the Company prior to
December 15, 1997. At any time on or after that date, the Debentures will be
redeemable, on at least 30 but not more than 60 days' notice, at the option of
the Company, as a whole or in part, at the following prices (expressed as
percentages of the principal amount), together with accrued interest to the date
fixed for redemption (provided that if the Redemption Date is an Interest
Payment Date, interest shall be paid to the Holder of record on the Regular
Record Date with respect to such Interest Payment Date):
If redeemed during the 12-month period beginning December 15:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
------------------------------------------------------------------ ----------
<S> <C>
1997.............................................................. 102%
1998.............................................................. 101%
</TABLE>
and 100% if redeemed at maturity. (Section 202 of the First Supplemental
Indenture)
If fewer than all the Debentures are to be redeemed, the Trustee will
select the Debentures to be redeemed by lot or, in its discretion, on a pro rata
basis. If any Debenture is to be redeemed in part only, a new Debenture or
Debentures in principal amount equal to the unredeemed principal portion thereof
will be issued. (Section 202 of the First Supplemental Indenture and Section
1107 of the Original Indenture)
REDEMPTION AT OPTION OF HOLDERS
If, at any time prior to December 15, 1999, there occurs a Fundamental
Change (as defined below), each Holder of Debentures shall have the right, at
the Holder's option, to require the Company to redeem all of such Holder's
Debentures or portions thereof (in denominations of $1,000 or multiples thereof)
on the date (the "Repurchase Date") that is 45 days after the date of the
Company's notice of such Fundamental Change referred to below (or, if not a
Business Day, on the next succeeding Business Day).
The Company shall redeem such Debentures at a price (expressed as
percentages of the principal amount) equal to (i) 105% if the Repurchase Date is
during the 12-month period beginning December 15, 1994, (ii) 104% if the
Repurchase Date is during the 12-month period beginning December 15, 1995, (iii)
103% if the Repurchase Date is during the 12-month period beginning December 15,
1996, and (iv) after December 14, 1997, the redemption price set forth under
"Optional Redemption by the Company" which would be applicable to a redemption
at the option of the Company on the Repurchase Date; provided that, with respect
to a Fundamental Change described in clause (i) in the definition of Applicable
Price below, if the Applicable Price is less than the Reference Market Price (as
defined below), the Company shall redeem such Debentures at a price equal to the
foregoing redemption price multiplied by the fraction obtained by dividing the
Applicable Price by the Reference Market Price. In each case, the Company shall
also pay accrued interest on the redeemed Debentures to the Repurchase Date
(provided that if the Repurchase Date is an Interest Payment Date, interest
shall be paid to the Holder of record on the Regular Record Date with respect to
such Interest Payment Date). (Section 203 of the First Supplemental Indenture)
The term "Fundamental Change" means the occurrence of any transaction or
event in connection with which all or substantially all the Company's Common
Stock shall be exchanged for, converted into, acquired for or constitute the
right to receive (whether by means of an exchange offer, liquidation, tender
offer, consolidation, merger, combination, reclassification, recapitalization or
otherwise) consideration which is not all or substantially all common stock that
is (or, upon consummation of such transaction or event, will be) listed on a
national securities exchange or approved for quotation in the National
Association of Securities Dealers, Inc., Automated Quotation System or any
similar system of automated dissemination of quotations of securities prices.
The term "Applicable Price" means (i) in the event of a Fundamental Change
in which the holders of the Common Stock receive only cash, the amount of cash
received by the holder of one share of Common Stock and (ii) in the event of any
other Fundamental Change, the average of the last reported sale price for the
Common Stock during the ten Trading Days prior to the record date for the
determination of the holders of Common Stock entitled to receive cash,
securities, property or other assets in connection with such
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Fundamental Change, or, if no such record date, the date upon which the holders
of the Common Stock shall have the right to receive such cash, securities,
property or other assets in connection with the Fundamental Change.
The term "Reference Market Price" shall initially mean $37.667 (which is
equal to 66 2/3% of the closing price of the Common Stock set forth on the cover
page of this Prospectus Supplement) and in the event of any adjustment to the
conversion price described above pursuant to Section 305 of the First
Supplemental Indenture, the Reference Market Price shall also be adjusted so
that the ratio of the Reference Market Price to the conversion price after
giving effect to any such adjustment shall always be the same as the ratio of
$37.667 to the conversion price specified on the cover page of this Prospectus
Supplement (without regard to any adjustment thereto).
On or before the 10th day after the occurrence of a Fundamental Change, the
Company shall mail to all Holders of record of the Debentures a notice of the
occurrence of such Fundamental Change and of the redemption right arising as a
result thereof. The Company shall deliver a copy of such notice to the Trustee.
To exercise the redemption right, Holders of Debentures must deliver on or
before the 30th day after the date of such notice by the Company written notice
to the Company (or an agent designated by the Company for such purpose) and the
Trustee of the Holder's exercise of such right, together with the Debentures
with respect to which the right is being exercised, duly endorsed for transfer.
Payment for Debentures surrendered for redemption (and not withdrawn) prior to
the Repurchase Date will be made promptly following the Repurchase Date.
(Section 203 of the First Supplemental Indenture)
The Company will comply with the provisions of Rule 13e-4 and any other
tender offer rules under the Securities Exchange Act of 1934, as amended, which
may then be applicable in connection with the redemption rights of Holders of
the Debentures in the event of a Fundamental Change. The redemption rights of
the Holders of the Debentures could discourage a potential acquiror of the
Company. The Fundamental Change redemption feature, however, is not the result
of management's knowledge of any specific effort to obtain control of the
Company by means of a merger, tender offer, solicitation or otherwise, or part
of a plan by management to adopt a series of anti-takeover provisions.
EVENTS OF DEFAULT AND REMEDIES
An Event of Default is defined in the Indenture as being: default in
payment of the principal of or premium, if any, on any of the Debentures;
default for 30 days in payment of any installment of interest on the Debentures;
default by the Company for 60 days after notice in the observance or performance
of any other covenant in the Indenture (other than a covenant solely for the
benefit of Securities other than the Debentures); or certain events involving
bankruptcy, insolvency or reorganization of the Company. (Section 501 of the
Original Indenture) The Indenture provides that the Trustee may withhold notice
to the Holders of Debentures of any default (except in payment of principal, or
premium, if any, or interest on the Debentures) if the Trustee considers it in
the interest of the Holders of the Debentures to do so. (Section 601 of the
Original Indenture)
The Indenture provides that if any Event of Default shall have occurred and
be continuing with respect to the Debentures, the Trustee or the Holders of not
less than 25% in principal amount of the Outstanding Debentures may declare the
principal of all the Debentures to be due and payable immediately, but if the
Company shall cure all defaults (except the nonpayment of interest and premium,
if any, on and principal of any Debentures which shall have become due by
acceleration) and certain other conditions are met, such declaration may be
annulled and past defaults may be waived by the Holders of a majority in
principal amount of the Outstanding Debentures. (Section 502 of the Original
Indenture)
The Holders of a majority in principal amount of the Outstanding Debentures
shall have the right to direct the time, method and place of conducting any
proceedings for any remedy available to the Trustee with respect to the
Debentures subject to certain limitations specified in the Indenture. (Section
512 of the Original Indenture)
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CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of the Holders of any of the Outstanding
Debentures, may consolidate with or merge into, or transfer or lease its assets
substantially as an entirety to, any Person which is a corporation, partnership
or trust organized and validly existing under the laws of any domestic
jurisdiction, or may permit any such 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, provided that any successor Person expressly
assumes the Company's obligations on the Debentures and under the Indenture,
that both immediately before and after giving effect to the transaction no Event
of Default shall have occurred and be continuing, and that certain other
conditions are met. (Section 801 of the Original Indenture)
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DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the debentures, notes and/or
other unsecured evidences of indebtedness offered hereby (the "Debt Securities")
sets forth certain general terms and provisions of the Debt Securities to which
any Prospectus Supplement may relate. The particular terms and provisions of the
series of Debt Securities offered by a Prospectus Supplement (the "Offered Debt
Securities"), the trustee with respect to the Offered Debt Securities, and the
extent to which the general terms and provisions described below may apply
thereto, will be described in the Prospectus Supplement relating to such Debt
Securities.
The Debt Securities will be issued under one or more indentures, the terms
of which will be substantially identical other than as described herein, with
one or more trustees. The indentures may include an Indenture in substantially
the form filed as an exhibit to the Registration Statement (the "Chase Manhattan
Indenture"), between the Company and The Chase Manhattan Bank (National
Association) ("Chase Manhattan"), as trustee, and an Indenture dated as of
December 5, 1994 (the "NationsBank Indenture"), between the Company and
NationsBank of Georgia, National Association ("NationsBank"), as trustee, copies
of which are filed as exhibits to the Registration Statement. The Chase
Manhattan Indenture and the NationsBank Indenture are referred to hereinafter
each as an "Indenture" and together as the "Indentures" and Chase Manhattan and
NationsBank are referred to hereinafter each as a "Trustee" and together as the
"Trustees." The following summaries of certain provisions of the Indentures do
not purport to be complete and are subject to, and are qualified in their
entirety by, reference to all of the provisions of the Indentures, including the
definitions therein of certain terms. Except as otherwise specified, all of the
provisions described below appear in each of the Indentures. Wherever particular
provisions or defined terms of the Indentures are referred to herein or in a
Prospectus Supplement, such provisions or defined terms are incorporated herein
or therein by reference. Section and Article references used herein are
references to the Indentures and, except as otherwise indicated, are identical
in both Indentures.
GENERAL
The Debt Securities will be direct, unsecured general obligations of the
Company that will rank on a parity with all other unsecured indebtedness of the
Company from time to time outstanding which is not by its terms subordinated to
the Debt Securities. The Debt Securities offered by this Prospectus will be
limited to $1,000,000,000 aggregate principal amount (based on the aggregate
initial public offering price of such Debt Securities), less the offering price
of any Common Stock which may be offered hereunder (other than through
conversion of Debt Securities), although the Indentures do not limit the
aggregate principal amount of Debt Securities that may be issued thereunder. The
Debt Securities may be issued thereunder from time to time in separate series up
to the aggregate amount from time to time authorized by the Company for each
series.
Unless otherwise indicated in a Prospectus Supplement relating to any
Offered Debt Securities, the covenants contained in the Indentures or the
Offered Debt Securities would not impose any limit on secured debt and would not
afford Holders of the Offered Debt Securities protection in the event of a
highly leveraged or other transaction involving the Company or its subsidiaries
that may adversely affect the Holders.
Reference is made to the applicable Prospectus Supplement for a description
of the following terms of the Offered Debt Securities in respect of which this
Prospectus is being delivered: (1) the title of the Offered Debt Securities; (2)
any limit on the aggregate principal amount of the Offered Debt Securities; (3)
the person to whom any interest on any Offered Debt Security shall be payable,
if other than the person in whose name the Offered Debt Security is registered
on the Regular Record Date; (4) the date or dates on which the Offered Debt
Securities will mature; (5) the rate or rates at which the Offered Debt
Securities will bear interest, if any, or the method by which such rate or rates
are determined, the date or dates from which any interest will accrue, the
Interest Payment Dates on which any such interest on the Offered Debt Securities
will be payable and the Regular Record Dates for interest payable on any such
Interest Payment Dates; (6) the place or places where the principal of and any
premium and interest on the Offered Debt Securities will be payable; (7) the
period or periods within which, the price or prices at which, and the terms and
conditions upon which the Offered Debt Securities may, pursuant to any optional
or mandatory provisions, be redeemed
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or purchased, in whole or in part, at the option of the Company; (8) the
obligation of the Company, if any, to redeem or purchase the Offered Debt
Securities pursuant to any sinking fund or analogous provisions or at the option
of the Holders, the period or periods within which, and the price or prices at
which and the terms and conditions upon which such Offered Debt Securities shall
be redeemed or purchased, in whole or in part; (9) the denominations in which
any Offered Debt Securities will be issuable; (10) any index, formula or other
method used to determine the amount of payments of principal of and any premium
and interest on the Offered Debt Securities; (11) if other than the principal
amount thereof, the portion of the principal amount of the Offered Debt
Securities which will be payable upon declaration of the acceleration of the
Maturity thereof; (12) the applicability of any covenants provided for in the
Indenture; (13) the applicability of any provisions described under "Defeasance
and Covenant Defeasance;" (14) whether any of the Offered Debt Securities are to
be issuable in permanent global form and, if so, the terms and conditions, if
any, upon which interests in such Offered Debt Securities in global form may be
exchanged, in whole or in part, for the individual Offered Debt Securities
represented thereby; (15) the terms, if any, upon which such Offered Debt
Securities may be converted into stock or other securities of the Company or any
other corporation, including the initial conversion price or conversion rate,
the conversion period and other conversion provisions; (16) any deletions from,
changes in or additions to Events of Default or covenants of the Company in the
applicable Indenture; (17) whether the Offered Debt Securities are issuable as
Registered Securities, Bearer Securities or both, and the terms upon which the
Bearer Securities can be exchanged for Registered Securities; (18) special
provisions relating to the issuance of Bearer Securities of any series; (19) the
form of the Offered Debt Securities and coupons, if any; (20) if other than U.S.
dollars, the Currency or Currencies in which payments of the principal of (or
premium, if any) or interest, if any, on the Offered Debt Securities will be
made or in which the Offered Debt Securities will be denominated; and (21) any
other terms of the Offered Debt Securities not inconsistent with the provisions
of the applicable Indenture. (See Section 301)
Debt Securities may be issued under the Indentures as Original Issue
Discount Securities to be offered and sold at a substantial discount below their
stated principal amount. Federal income tax consequences and other special
considerations applicable to any such Original Issue Discount Securities will be
described in the Prospectus Supplement relating thereto. "Original Issue
Discount Security" means any security that provides for an amount less than the
principal amount thereof to be due and payable upon the declaration of
acceleration of the Maturity thereof upon the occurrence of an Event of Default
and the continuation thereof. (Section 101)
EXCHANGE, REGISTRATION, TRANSFER AND PAYMENT
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of principal, premium, if any, and interest, if any, on the Debt Securities will
be payable, and the exchange of and the transfer of Debt Securities will be
registerable, at the office or agency of the Company maintained for such purpose
and at any other office or agency maintained for such purpose. (Sections 307 and
1002) Unless otherwise indicated in the applicable Prospectus Supplement, the
Debt Securities will be issued in denominations of $1,000 or integral multiples
thereof. (Section 302) No service charge will be made for any registration of
transfer or exchange of Debt Securities, but the Company may require payment of
a sum sufficient to cover any tax or other governmental charge imposed in
connection therewith. (Section 305)
All moneys paid by the Company to the Trustee or a Paying Agent for the
payment of principal, premium, if any, or interest, if any, on any Debt Security
which remain unclaimed for two years after such principal, premium, or interest
has become due and payable may to the extent permitted by law be repaid to the
Company, and thereafter the Holder of such Debt Security may look only to the
Company for payment thereof. (Section 403)
In the event of any redemption, the Company shall not be required to (i)
issue, register the transfer of or exchange Debt Securities of any series during
a period beginning at the opening of business 15 days before the selection of
the Debt Securities of that series to be redeemed and ending at the close of
business on the day of mailing the notice of redemption for such Debt Securities
or (ii) register the transfer of or exchange any Debt Security, or portion
thereof, called for redemption, except the unredeemed portion of any Debt
Security being redeemed in part. (Section 305)
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BOOK-ENTRY SYSTEM
The provisions set forth below in this section headed "Book-Entry System"
will apply to the Debt Securities of any series if the Prospectus Supplement
relating to such series so indicates.
The Debt Securities of such series will be represented by one or more
global securities (collectively, a "Global Security") registered in the name of
a depositary (the "Depositary") or a nominee of the Depositary identified in the
Prospectus Supplement relating to such series. Except as set forth below, a
Global Security may be transferred, in whole or in part, only to the Depositary
or another nominee of the Depositary.
Upon the issuance of a Global Security, the Depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts of
the Debt Securities represented by such Global Security to the accounts of
institutions that have accounts with the Depositary or its nominee
("participants"). The accounts to be credited will be designated by the
underwriters, dealers or agents. Ownership of beneficial interests in a Global
Security will be limited to participants or persons that may hold interests
through participants. Ownership of interests in such Global Security will be
shown on, and the transfer of those ownership interests will be effected only
through, records maintained by the Depository (with respect to participants'
interests) and such participants (with respect to the owners of beneficial
interests in such Global Security). The laws of some jurisdictions may require
that certain purchasers of securities take physical delivery of such securities
in definitive form. Such limits and laws may impair the ability to transfer
beneficial interests in a Global Security.
So long as the Depositary, or its nominee, is the registered holder and
owner of such Global Security, the Depositary or such nominee, as the case may
be, will be considered the sole owner and holder of the related Debt Securities
for all purposes of such Debt Securities and for all purposes under the Debt
Securities Indenture. Except as set forth below or as otherwise provided in the
applicable Prospectus Supplement, owners of beneficial interests in a Global
Security will not be entitled to have the Debt Securities represented by such
Global Security registered in their names, will not receive or be entitled to
receive physical delivery of Debt Securities in definitive form and will not be
considered to be the owners or holders of any Debt Securities under the
Indenture or such Global Security.
Accordingly, each person owning a beneficial interest in a Global Security
must rely on the procedures of the Depositary and, if such person is not a
participant, on the procedures of the participant through which such person owns
its interest, to exercise any rights of a holder of Debt Securities under the
applicable Indenture or such Global Security. The Company understands that under
existing industry practice, in the event the Company requests any action of
holders of Debt Securities or an owner of a beneficial interest in a Global
Security desires to take any action that the Depositary, as the holder of such
Global Security is entitled to take, the Depositary would authorize the
participants to take such action, and that the participants would authorize
beneficial owners owning through such participants to take such action or would
otherwise act upon the instructions of beneficial owners owning through them.
Payment of principal of and premium, if any, and interest, if any, on Debt
Securities represented by a Global Security will be made to the Depositary or
its nominee, as the case may be, as the registered owner and holder of such
Global Security.
The Company expects that the Depositary, upon receipt of any payment of
principal, premium, if any, or interest, if any, in respect of a Global
Security, will credit immediately participants' accounts with payments in
amounts proportionate to the irrespective beneficial interests in the principal
amount of such Global Security as shown on the records of the Depositary. The
Company expects that payments by participants to owners of beneficial interests
in a Global Security held through such participants will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name," and
will be the responsibility of such participants. Neither the Company nor the
applicable Trustee nor any agent of the Company or the applicable Trustee will
have any responsibility or liability for any aspect of the records relating to,
or payments made on account of, beneficial ownership interests in a Global
Security for any Debt Securities or for maintaining, supervising or reviewing
any records relating to such beneficial ownership interests or for any other
aspect of the relationship between
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the Depositary and its participants or the relationship between such
participants and the owners of beneficial interests in such Global Security
owning through such participants.
Unless and until it is exchanged in whole or in part for Debt Securities in
definitive form, a Global Security may not be transferred except as a whole by
the Depositary to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary.
Unless otherwise provided in the applicable Prospectus Supplement, Debt
Securities represented by a Global Security will be exchangeable for Debt
Securities in definitive form of like tenor as such Global Security in
denominations of $1,000 and in any greater amount that is an integral multiple
thereof if (i) the Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for such Global Security or if at any time the
Depositary ceases to be a clearing agency registered under the Exchange Act,
(ii) the Company in its discretion at any time determines not to have all of the
Debt Securities represented by a Global Security and notifies the applicable
Trustee thereof or (iii) an Event of Default has occurred and is continuing with
respect to the Debt Securities. Any Debt Security that is exchangeable pursuant
to the preceding sentence is exchangeable for Debt Securities issuable in
authorized denominations and registered in such names as the Depositary shall
direct. Subject to the foregoing, a Global Security is not exchangeable, except
for a Global Security or Global Securities of the same aggregate denominations
to be registered in the name of the Depositary or its nominee.
EVENTS OF DEFAULT
Any one of the following events will constitute an Event of Default under
the Indentures with respect to Debt Securities of any series (unless such event
is specifically inapplicable to a particular series as described in the
Prospectus Supplement relating thereto): (a) failure to pay any interest on any
Debt Security of that series when due, continued for 30 days; (b) failure to pay
principal of or any premium on any Debt Security of that series when due; (c)
failure to deposit any sinking fund payment, when due, in respect of any Debt
Security of that series; (d) failure to perform any other covenant of the
Company in the Indenture (other than a covenant included in the Indenture solely
for the benefit of a series of Debt Securities other than that series),
continued for 60 days after written notice as provided in the Indenture; (e)
certain events of bankruptcy, insolvency or reorganization involving the
Company; and (f) any other Event of Default provided with respect to Debt
Securities of that series. (Section 501) No Event of Default described above
with respect to a particular series of Debt Securities necessarily constitutes
an Event of Default with respect to any other series of Debt Securities.
Subject to the provisions of the Indentures relating to the duties of the
Trustee in case an Event of Default shall occur and be continuing, the Trustee
will be under no obligation to exercise any of its rights or powers under the
Indentures at the request or direction of any of the Holders, unless such
Holders shall have offered to the Trustee reasonable security or indemnity.
(Sections 507 and 603) Subject to certain provisions, including those requiring
security and indemnification of the Trustee, the Holders of a majority in
aggregate principal amount of the Outstanding Debt Securities of any series will
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. (Section 512)
The Indenture provides that the Company will deliver to the Trustee, within
120 days after the end of each fiscal year, an Officers' Certificate, stating as
to each signer thereof as to his knowledge of the Company's compliance with all
conditions and covenants under the Indenture. (Section 1005)
If an Event of Default shall occur and be continuing with respect to Debt
Securities of any series, either the Trustee or the Holders of at least 25% in
aggregate principal amount of all Outstanding Debt Securities of that series may
accelerate the maturity of all Debt Securities of that series; provided,
however, that after such acceleration, but before a judgment or decree based on
acceleration, the Holders of a majority in aggregate principal amount of the
Outstanding Debt Securities of that series may, under certain circumstances,
rescind and annul such acceleration if all Events of Default, other than the
non-payment of accelerated principal, have been cured or waived as provided in
the Indenture. (Section 502) For information as to waiver of defaults, see
"Modifications and Waiver" below.
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No Holder of any Debt Security of any series will have any right to
institute any proceeding with respect to the Indenture or for any remedy
thereunder, unless such Holder shall have previously given to the Trustee
written notice of a continuing Event of Default and unless also the Holders of
at least 25% in aggregate principal amount of the Outstanding Debt Securities of
that series shall have made written request, and offered reasonable indemnity,
to the Trustee to institute such proceeding as trustee, and the Trustee shall
not have received from the Holders of a majority in aggregate principal amount
of the Outstanding Debt Securities of that series a direction inconsistent with
such request and shall have failed to institute such proceedings within 60 days.
(Section 507). However, such limitations generally do not apply to a suit
instituted by a Holder of a Debt Security for the enforcement of payment of the
principal or interest on such Security on or after the respective due dates
expressed in such Debt Security. (Section 508)
The Trustee will, with certain exceptions, give Holders notice of all
Events of Defaults known to the Trustee within 90 days after the occurrence
thereof. (Section 601)
MODIFICATIONS AND WAIVER
Modifications and amendments of an Indenture may be made by the Company and
the relevant Trustee with the consent of the Holders of not less than a majority
in aggregate principal amount of the Outstanding Debt Securities of each series
affected by such modification or amendment; provided, however that no such
modification or amendment may, without the consent of the Holder of each
Outstanding Debt Security affected thereby, (a) change the Stated Maturity of
the principal of, or any installment of principal of or interest on any Debt
Security, (b) reduce the principal amount of, rate of interest on or any premium
payable upon the redemption of any Debt Security, (c) reduce the amount of
principal of an Original Issue Discount Security payable upon acceleration of
the Maturity thereof, (d) change the Place of Payment where, or the Currency in
which, principal, premium, if any, or interest on any Debt Security is payable,
(e) adversely affect any right to convert or exchange any Debt Security, (f)
impair the right to institute suit for the enforcement of any payment on or with
respect to any Debt Security, (g) reduce the percentage in principal amount of
Outstanding Debt Securities of any series, the consent of whose Holders is
required for modification or amendment of the Indenture or for waiver of
compliance with certain provisions of the Indenture or for waiver of certain
defaults, or (h) modify any of the provisions set forth in this paragraph except
to increase any such percentage or to provide that certain other provisions of
the Indenture may not be modified or waived without the consent of the holder of
each Outstanding Debt Security affected thereby. (Section 902)
The Holders of at least a majority in aggregate principal amount of the
Outstanding Debt Securities of each series may, on behalf of the Holders of all
the Debt Securities of that series, waive, insofar as that series is concerned,
compliance by the Company with certain provisions of the Indenture. (Section
1006) The Holder of not less than a majority in aggregate principal amount of
the Outstanding Debt Securities of each series may, on behalf of all Holders of
Debt Securities of that series, waive any past default under the Indenture with
respect to Debt Securities of that series, except a default (a) in the payment
of principal of, any premium on or any interest on any Debt Security of such
series or (b) in respect of a covenant or provision of the Indenture which
cannot be modified or amended without the consent of the Holder of each
Outstanding Debt Security of such series affected thereby. (Section 513)
The Indentures provide that in determining whether the Holders of the
requisite principal amount of the Outstanding Debt Securities have given any
request, demand, authorization, direction, notice, consent or waiver thereunder
or whether a quorum is present at a meeting of Holders of Debt Securities, the
principal amount of an Original Issue Discount Security that shall be deemed to
be Outstanding shall be the amount of the principal thereof that would be due
and payable as of the date of such determination upon acceleration of the
Maturity thereof. (Section 101)
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of the Holders of any of the Outstanding
Debt Securities under the Indentures, may consolidate with or merge into, or
transfer or lease its assets substantially as an entirety to, any Person which
is a corporation, partnership or trust organized and validly existing under the
laws of any
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domestic jurisdiction, or may permit any such 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, provided that any successor Person
expressly assumes the Company's obligations on the Debt Securities and under the
Indentures, that both immediately before and after giving effect to the
transaction, no Event of Default or Default shall have occurred and be
continuing, and that certain other conditions are met. (Section 801)
DEFEASANCE AND COVENANT DEFEASANCE
The Indentures provide that, if such provision is made applicable to the
Debt Securities of any series pursuant to the provisions of the Indentures, the
Company may elect (i) to defease and be discharged from any and all obligations
in respect of such Debt Securities except for certain obligations to register
the transfer or exchange of such Debt Securities, to replace temporary,
destroyed, stolen, lost or mutilated Debt Securities, to maintain paying
agencies and to hold monies for payment in trust ("defeasance") or (ii) to be
released from its obligations with respect to certain covenants applicable to
the Debt Securities of any series ("covenant defeasance"), in either case upon
the deposit with the applicable Trustee (or other qualifying trustee), in trust,
of money and/or Government Obligations, which through the payment of interest
and principal in accordance with their terms will provide money in an amount
sufficient to pay the principal of and any premium and interest on the Debt
Securities of such series on the respective Stated Maturities and any mandatory
sinking fund payments or analogous payments on the days payable, in accordance
with the terms of the relevant Indenture and the Debt Securities of such series.
Upon the occurrence of a defeasance, the Company will be deemed to have paid and
discharged the entire indebtedness represented by such Debt Securities (except
for (i) the rights of Holders of such Debt Securities to receive, solely from
the trust funds deposited to defease such Debt Securities, payments in respect
of the principal of, premium, if any, and interest, if any, on such Debt
Securities when such payments are due and (ii) certain other obligations as
provided in the relevant Indenture). (Section 1402) Upon the occurrence of a
covenant defeasance, the Company will be released only from its obligations to
comply with certain covenants contained in the relevant Indenture relating to
such Debt Securities, will continue to be obligated in all other respects under
such Debt Securities and will continue to be contingently liable with respect to
the payment of principal, interest, if any, and premium, if any, with respect to
such Debt Securities. (Section 1403)
Unless otherwise specified in the applicable Prospectus Supplement, the
Company may not effect a defeasance or a covenant defeasance unless, among other
things, the Company has delivered to the applicable Trustee an Opinion of
Counsel to the effect that the Holders of the Outstanding Debt Securities of
such series will not recognize gain or loss for Federal income tax purposes as a
result of such deposit, defeasance or covenant defeasance and will be subject to
Federal income tax on the same amount, and in the same manner and at the same
times as would have been the case if such deposit, defeasance or covenant
defeasance had not occurred. Such opinion, in the case of full defeasance (in
contrast to a more limited covenant defeasance), must refer to and be based upon
a ruling of the Internal Revenue Service or a change in applicable Federal
income tax law occurring after the date of the Indenture. The Prospectus
Supplement relating to a series may further describe the provisions, if any,
permitting such defeasance or covenant defeasance with respect to the Debt
Securities of a particular series. (Section 1404)
Subject to satisfying the required opinion and other conditions, the
Company may exercise its full defeasance option with respect to any series of
Debt Securities notwithstanding its prior exercise of a more limited covenant
defeasance option. If the Company exercises its full defeasance option, payment
of such Debt Securities may not be accelerated because of a Default or an Event
of Default. If the Company exercises a more limited covenant defeasance option,
payment of such Debt Securities may not be accelerated by reason of a Default or
an Event of Default with respect to the covenants to which such covenant
defeasance is applicable. If an acceleration were to occur for other reasons,
however, and such Debt Securities were declared due and payable, the amount of
money and Government Obligations on deposit with the Trustee will be sufficient
to pay amounts due on the Debt Securities of such series at the time of their
Stated Maturity but may not be sufficient to pay amounts due on the Debt
Securities of such series at the time of the acceleration resulting from such
acceleration. In the event of such an acceleration following a covenant
defeasance, however, the Company would remain liable for any such insufficiency.
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NOTICES
Notices to Holders of Registered Securities will be given by mail to the
addresses of such Holders as they appear in the Security Register. (Section
106)
REPLACEMENT OF SECURITIES
Any mutilated Debt Security will be replaced by the Company at the expense
of the Holder upon surrender of such Debt Security to the applicable Trustee.
Debt Securities that are destroyed, stolen or lost will be replaced by the
Company at the expense of the Holder upon delivery to the applicable Trustee of
evidence of the destruction, loss or theft thereof satisfactory to the Company
and the applicable Trustee. In the case of a destroyed, lost or stolen Debt
Security an indemnity satisfactory to the applicable Trustee and the Company may
be required at the expense of the Holder of such Debt Security before a
replacement Debt Security will be issued. (Section 306)
GOVERNING LAW
The Indentures and the Debt Securities will be governed by, and construed
in accordance with, the laws of the State of New York. (Section 111)
REGARDING THE TRUSTEE
Each of the Trustees is currently one of the participating lenders for the
Company's $1 billion credit facility and provides certain other banking and
financial services to the Company in the ordinary course of business and may
provide other such services in the future.
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