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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 5, 1994
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HOUGHTON MIFFLIN COMPANY
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(Exact name of registrant as specified in charter)
Massachusetts 1-5406 04-1456030
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
222 Berkeley Street, Boston, Massachusetts 02116
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 617-351-5000
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N/A
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(Former name or former address, if changed since last report.)
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Item 5. Other Events.
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On March 28, 1994, Houghton Mifflin Company executed a Terms Agreement
(attached hereto as Exhibit 1.2) relating to the sale of $100,000,000
aggregate principal amount of 7 1/8% Notes due 2004. These Notes were issued
on April 5, 1994 pursuant to a registration statement on Form S-3, filed under
Rule 415 of the Securities and Exchange Commission, which was declared
effective on October 8, 1992.
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Item 7.
(c). Exhibits.
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1.1 Underwriting Agreement incorporated by reference in the
Terms Agreement.
1.2 Terms Agreement dated March 28, 1994 by and among the
Company and CS First Boston Corporation and J.P. Morgan
Securities Inc., as underwriters.
4.1 Indenture dated as of March 15, 1994 between the
Company and The First National Bank of Boston, as
trustee.
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized this 12th day of April, 1994.
HOUGHTON MIFFLIN COMPANY
By: /s/ Stephen O. Jaeger
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Stephen O. Jaeger,
Executive Vice President, Chief
Financial Officer and Treasurer
(Principal Accounting and Financial
Officer)
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<TABLE>
<CAPTION>
Exhibit Index
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Exhibit Page
No. Exhibit Description No.
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<C> <S> <C>
1.1 Underwriting Agreement incorporated by reference in the Terms
Agreement.
1.2 Terms Agreement dated March 28, 1994 by and among the Company and
CS First Boston Corporation and J.P. Morgan Securities Inc.,
as underwriters.
4.1 Indenture dated as of March 15, 1994 between the Company and
The First National Bank of Boston, as trustee.
</TABLE>
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Exhibit 1.1
HOUGHTON MIFFLIN COMPANY
7 1/8% Notes Due 2004
UNDERWRITING AGREEMENT
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1. Introductory. Houghton Mifflin Company, a Massachusetts
corporation ("Company"), proposes to issue and sell all of its debt securities
registered under the registration statement referred to in Section 2(a) ("Reg-
istered Securities"). The Registered Securities will be issued under an
indenture, dated as of March 15, 1994 ("Indenture"), between the Company and The
First National Bank of Boston, a national banking association, as Trustee, in
one or more series, which series may vary as to interest rates, maturities,
redemption provisions, selling prices and other terms, with all such terms for
any particular series of the Registered Securities being determined at the time
of sale. Particular series of the Registered Securities will be sold pursuant
to a Terms Agreement referred to in Section 3, for resale in accordance with
terms of offering determined at the time of sale.
The Registered Securities involved in any such offering are
hereinafter referred to as the "Securities". The firm or firms which agree to
purchase the Securities are hereinafter referred to as the "Underwriters" of
such Securities, and the representative or representatives of the Underwriters,
if any, specified in a Terms Agreement referred to in Section 3 are hereinafter
referred to as the "Representatives"; provided, however, that if the Terms
Agreement does not specify any representative of the Underwriters, the term
"Representatives", as used in this Agreement (other than in Sections 2(b), 5(c)
and 6 and the second sentence of Section 3), shall mean the Underwriters.
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, each Underwriter that:
(a) A registration statement on Form S-3 (No. 33-51700),
including a prospectus, relating to the Registered Securities has been
filed with the Securities and Exchange Commission ("Commission") and has
become effective. Such registration statement,
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as amended at the time of any Terms Agreement referred to in Section 3, is
hereinafter referred to as the "Registration Statement", and the prospectus
included in such Registration Statement, as supplemented as contemplated
by Section 3 to reflect the terms of the Securities and the terms of
offering thereof, as first filed with the Commission pursuant to and in
accordance with Rule 424(b) ("Rule 424(b)") under the Securities Act of
1933 ("Act"), including all material incorporated by reference therein, is
hereinafter referred to as the "Prospectus".
(b) On the effective date of the registration statement
relating to the Registered Securities, such registration statement
conformed in all re-spects to the requirements of the Act, the Trust
Indenture Act of 1939 ("Trust Indenture Act") and the rules and
regulations of the Commission ("Rules and Regulations") and did not
include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not mis-leading, and on the date of each Terms
Agreement referred to in Section 3, the Registration Statement and the
Prospectus will conform in all respects to the requirements of the Act,
the Trust Indenture Act and the Rules and Regulations, and neither of
such documents will include any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, except that the
foregoing does not apply to statements in or omissions from any of such
documents based upon written information furnished to the Company by any
Underwriter through the Representatives specifically for use therein.
3. Purchase and Offering of Securities. The obligation of the
Underwriters to purchase the Securities will be evidenced by an exchange of
telegraphic or other written communications ("Terms Agreement") at the time the
Company determines to sell the Securities. The Terms Agreement will incorporate
by reference the provisions of this Agreement, except as otherwise provided
therein, and will specify the firm or firms which will be Underwriters, the
names of any Representatives, the principal amount to be purchased by each
Underwriter, the purchase
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price to be paid by the Underwriters and the terms of the Securities not
already specified in the Indenture, including, but not limited to, interest
rate, maturity, any redemption provisions and any sinking fund requirements
and whether any of the Securities may be sold to institutional investors
pursuant to Delayed Delivery Contracts (as defined below). The Terms Agreement
will also specify the time and date of delivery and payment (such time and
date, or such other time not later than seven full business days thereafter as
the Representatives and the Company agree as the time for payment and
delivery, being herein and in the Terms Agreement referred to as the "Closing
Date"), the place of delivery and payment and any details of the terms of the
offering that should be reflected in the prospectus supplement relating to the
offering of the Securities. The obligations of the Underwriters to purchase
the Securities will be several and not joint. It is understood that the
Underwriters propose to offer the Securities for sale as set forth in the
Prospectus. The Securities delivered to the Underwriters on the Closing Date
may be represented by a single, global security to be deposited with The
Depository Trust Company or may be in definitive, fully registered form, in
such denominations and registered in such names as the Underwriters may
request.
If the Terms Agreement provides for sales of Securities pursuant to
delayed delivery contracts, the Company authorizes the Underwriters to solicit
offers to purchase Securities pursuant to delayed delivery contracts sub-
stantially in the form of Annex I attached hereto, with such changes therein as
the Company may authorize or approve ("Delayed Delivery Contracts"). Delayed
Delivery Contracts are to be with institutional investors, including commercial
and savings banks, insurance companies, pension funds, investment companies and
educational and charitable institutions. On the Closing Date, the Company will
pay, as compensation, to the Representatives for the accounts of the
Underwriters, the fee set forth in such Terms Agreement in respect of the
principal amount of Securities to be sold pursuant to Delayed Delivery Contracts
("Contract Securities"). The Underwriters will not have any responsibility in
respect of the validity or the performance of Delayed Delivery Contracts. If
the Company executes and delivers Delayed Delivery Contracts, the Contract
Securities will be deducted from the Securities to be purchased by the
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several Underwriters and the aggregate principal amount of Securities to be
purchased by each Underwriter will be reduced pro rata in proportion to the
principal amount of Securities set forth opposite each Underwriter's name in
such Terms Agreement, except to the extent that the Representatives determine
that such reduction shall be otherwise than pro rata and so advise the
Company. The Company will advise the Representatives not later than the
business day prior to the Closing Date of the principal amount of Contract
Securities.
4. Certain Agreements of the Company. The Company agrees with the several
Underwriters that it will furnish to Skadden, Arps, Slate, Meagher & Flom,
counsel for the Underwriters, one signed copy of the registration statement
relating to the Registered Securities, including all exhibits, in the form it
became effective and of all amendments thereto and that, in connection with each
offering of Securities:
(a) The Company will file the Prospectus with the Commission pursuant
to and in accordance with Rule 424(b)(2)(or, if applicable and if consented
to by the Representatives, subparagraph (5)) not later than the second
business day following the execution and delivery of the Terms Agreement.
(b) The Company will advise the Representatives promptly of any
proposal to amend or supplement the Registration Statement or the
Prospectus and will afford the Representatives a reasonable opportunity to
comment on any such proposed amendment or supplement; and the Company will
also advise the Representatives promptly of the filing of any such
amendment or supplement and of the institution by the Commission of any
stop order proceedings in respect of the Registration Statement or of any
part thereof and will use its best efforts to prevent the issuance of any
such stop order and to obtain as soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Securities is
required to be delivered under the Act, any event occurs as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact
necessary to make
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the statements therein, in the light of the circumstances under which
they were made, not misleading, or if it is necessary at any time to
amend the Prospectus to comply with the Act, the Company promptly will
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. Neither the Representatives' consent to, nor the
Underwriters' delivery of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 5.
(d) As soon as practicable, but not later than 16 months, after the
date of each Terms Agreement, the Company will make generally available to
its securityholders an earnings statement covering a period of at least 12
months beginning after the latest to occur of (i) the effective date of the
registration statement relating to the Registered Securities, (ii) the
effective date of the most recent post-effective amendment to the
Registration Statement to become effective prior to the date of such Terms
Agreement 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 Terms
Agreement, which will satisfy the provisions of Section 11(a) of the Act.
(e) The Company will furnish to the Representatives copies of the
Registration Statement, including all exhibits, any related preliminary
prospectus, any related preliminary prospectus supplement, the Prospectus
and all amendments and supplements to such documents, in each case as soon
as available and in such quantities as are reasonably requested.
(f) The Company will arrange for the qualification of the Securities
for sale and the determination of their eligibility for investment under
the laws of such jurisdictions as the Representatives designate and will
continue such qualifications in effect so long as required for the
distribution; provided, however, that nothing herein shall require the
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Company to qualify to do business in any jurisdiction where it is not now
so qualified or to take
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any action that would subject it to general service of process in any
jurisdiction where it is not now so subject.
(g) During the period of five years after the date of any Terms
Agreement, the Company will, upon request, furnish to the Representatives
and to each of the other Underwriters, if any, as soon as practicable
after the end of each fiscal year, a copy of its annual report to
stockholders for such year; and the Company will, upon request, furnish to
the Representatives (i) as soon as available, a copy of each report or
definitive proxy statement of the Company filed with the Commission under
the Securities Exchange Act of 1934 or mailed to stockholders, and (ii)
from time to time, such other information concerning the Company as the
Representatives may reasonably request.
(h) The Company will pay all expenses incident to the performance of
its obligations under this Agreement and will reimburse the Underwriters
for any expenses (including reasonable fees and disbursements of counsel)
incurred by them in connection with qualification of the Registered
Securities for sale and determination of their eligibility for investment
under the laws of such jurisdictions as the Representatives may designate
and the printing of memoranda relating thereto, for any fees charged by
investment rating agencies for the rating of the Securities and for
expenses incurred in distributing the Prospectus, any preliminary
prospectuses and any preliminary prospectus supplements to Underwriters.
(i) For a period beginning at the time of execution of the Terms
Agreement and ending 30 days after the Closing Date, without the prior
consent of the Representatives, the Company will not offer, sell, contract
to sell or otherwise dispose of any United States dollar-denominated debt
securities issued or guaranteed by the Company and having a maturity of
more than one year from the date of issue.
5. Conditions of the Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Securities will be subject
to
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the accuracy of the representations and warranties on the part of the Company
herein, to the accuracy of the statements of Company officers made pursuant
to the provisions hereof, to the performance by the Company of its obliga-
tions hereunder and to the following additional conditions precedent:
(a) On or prior to the date of the Terms Agreement, the
Representatives shall have received letters, dated the date of delivery
thereof, of Ernst & Young (with respect to the Company and its subsidiaries
(the "Subsidiaries") (other than McDougal, Littell & Company, a Delaware
corporation ("McDougal, Littell"))) and Crowe Chizek and Company (with
respect to McDougal Littell), substantially in the form principally agreed
upon on March 22, 1994.
(b) The Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 4(a) of this
Agreement. No stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceedings for
that purpose shall have been instituted or, to the knowledge of the Company
or any Underwriter, shall be contemplated by the Commission.
(c) Subsequent to the execution of the Terms Agreement, there shall
not have occurred: (i) any change, or any development involving a
prospective change, in or affecting particularly the business or properties
of the Company or its Subsidiaries which, in the judgment of a majority in
interest of the Underwriters, including any Representatives, materially
impairs the investment quality of the Securities or the Registered
Securities; (ii) any down-grading in the rating of any 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
announce-ment 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); (iii) any
suspension or limitation of trading in securities generally on the
New York
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Stock Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the Company
on any exchange or in the over-the-counter market; (iv) any banking
moratorium declared by federal or New York authorities; or (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 or international calamity or emergency if, in the judgment of a
majority in interest of the Underwriters, including any Representatives,
the effect of any such outbreak, escalation, declaration, calamity or
emergency makes it impractical or inadvisable to proceed with completion
of the sale of and payment for the Securities.
(d) The Representatives shall have received an opinion, dated the
Closing Date, of Goodwin, Procter & Hoar, counsel for the Company, or Paul
D. Weaver, Senior Vice President and General Counsel of the Company, to the
effect that:
(i) The Company and each of its Subsidiaries have been duly
incorporated, are validly existing and are in good standing under the
laws of their respective jurisdictions of incorporation, with
corporate power and authority to own their properties and conduct
their business as described in the Prospectus;
(ii) The Company and the Subsidiaries are duly qualified to do
business as foreign corporations in good standing in all other
jurisdictions in which they own or lease substantial properties or in
which the conduct of their business requires such qualification,
except where the failure to so qualify would not have a material
adverse effect on the Company and its Subsidiaries taken as a whole;
(iii) The Indenture has been duly authorized, executed and
delivered by the Company and has been duly qualified under the Trust
Indenture Act; the Securities have been duly authorized; the
Securities other than any Contract Securities have been duly
executed, authenticated, issued and delivered; the Inden-
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ture and the Securities other than any Contract Securities
constitute, and any Contract Securities, when executed,
authenticated, issued and delivered in the manner provided in the
Indenture and sold pursuant to Delayed Delivery Contracts, 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
similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and the
Securities other than any Contract Securities conform, and any
Contract Securities, when so issued and delivered and sold, will
conform, to the description thereof contained in the Prospectus ;
(iv) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for the
consummation of the transactions contemplated by the Terms Agreement
(including the provisions of this Agreement) in connection with the
issuance or sale of the Securities by the Company, except such as
have been obtained and made under the Act and the Trust Indenture Act
and such as may be required under state securities laws;
(v) The execution, delivery and performance of the Indenture,
the Terms Agreement (including the provisions of this Agreement) and
any Delayed Delivery Contracts and the issuance and sale of the
Securities and compliance with the terms and provisions thereof will
not result in a breach or violation of any of the terms and provisions
of, or constitute a default under, any statute, any rule, regulation
or order of any governmental agency or body or any court having
jurisdiction over the Company or any Subsidiary or any of their prop-
erties or any agreement or instrument to which the Company or any such
Subsidiary is a party or by which the Company or any such Subsidiary
is bound or to which any of the properties of the Company or any such
Subsidiary is subject,
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or the charter or by-laws of the Company or any such Subsidiary, and
the Company has full power and authority to authorize, issue and
sell the Securities as contemplated by the Terms Agreement
(including the provisions of this Agreement);
(vi) The Registration Statement has become effective under the
Act, the Prospectus was filed with the Commission pursuant to the sub-
paragraph of Rule 424(b) specified in such opinion on the date
specified therein, and, to the best knowledge of such counsel, no stop
order suspending the effectiveness of the Registration Statement or
of any part thereof has been issued and no proceedings for that
purpose have been instituted or are pending or contemplated under the
Act, and the registration statement relating to the Registered Securi-
ties, as of its effective date, the Registration Statement and the
Prospectus, as of the date of the Terms Agreement, and any amendment
or supplement thereto, as of its date, complied as to form in all
material respects with the requirements of the Act, the Trust
Indenture Act and the Rules and Regulations; and
(vii) The Terms Agreement (including the provisions of this
Agreement) and any Delayed Delivery Contracts have been duly
authorized, executed and delivered by the Company.
In addition, such counsel shall state that such counsel have no reason to
believe that such registration statement, as of its effective date, the
Registration Statement or the Prospectus, as of the date of the Terms Agreement,
or any such amendment or supplement, as of its date, contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not misleading;
the descriptions in the Registration Statement and Prospectus of statutes, legal
and governmental proceedings and contracts and other documents are accurate and
fairly present the information required to be shown; and such counsel do not
know of any legal or governmental proceedings required to be described in the
Prospectus which are not described as required or of any
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contracts or documents of a character required to be described in the
Registration Statement or Prospectus or to be filed as exhibits to the
Registration Statement which are not described and filed as required; it being
understood that such counsel need express no opinion as to the financial
statements or other financial data contained in the Registration Statement or
the Prospectus.
(e) The Representatives shall have received from Skadden, Arps,
Slate, Meagher & Flom, counsel for the Underwriters, such opinion or
opinions, dated the Closing Date, with respect to the incorporation of the
Company and its Subsidiaries, the validity of the Securities, the
Registration Statement, the Prospectus and other related matters as they
may require, and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon
such matters. In rendering such opinion, Skadden, Arps, Slate, Meagher &
Flom may rely as to the incorporation of the Company and all other matters
governed by Massachusetts law upon the opinion of Goodwin, Procter & Hoar
referred to above.
(f) The Representatives shall have received a certificate, dated the
Closing Date, of the President or any Vice-President and a principal
financial or accounting officer of the Company in which such officers, to
the best of their knowledge after reasonable investigation, shall state
that the representations and warranties of the Company in this Agreement
are true and correct, that the Company has complied with all agreements
and satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date, that no stop order suspending
the effectiveness of the Registration Statement or of any part thereof has
been issued and no proceedings for that purpose have been instituted or are
contemplated by the Commission and that, subsequent to the date of the
most recent financial statements in the Prospectus, there has been no
material adverse change in the financial position or results of operation
of the Company and its Subsidiaries except as set forth in or contemplated
by the Prospectus or as described in such certificate.
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(g) The Representatives shall have received letters, dated the Closing
Date, of Ernst & Young (with respect to the Company and its Subsidiaries,
other than McDougal, Littell) and Crowe Chizek and Company (with respect to
McDougal, Littell), which reconfirm the matters set forth in their letters
delivered pursuant to subsection (a) of this Section and, in addition to
such other matters as the Representatives may reasonably request, state in
effect that:
(i) in their opinion, any financial statements or schedules
examined by them and included in the Prospectus and not covered by
their letters delivered pursuant to subsection (a) of this Section
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 included in the Prospectus and not covered by their letters
delivered pursuant to subsection (a) of this Section in accordance
with standards established by the American Institute of Certified
Public Accountants, as indicated in their report or reports attached
to such letters;
(iii) on the basis of the review referred to in (ii) above, a
reading of the latest available interim financial statements of the
Company or McDougal, Littell, inquiries of officials of the Company or
McDougal, Littell who have responsibility for financial and ac-
counting matters and other specified procedures, nothing came to
their attention that caused them to believe that:
(A) the unaudited financial statements, if any, included in
the Prospectus and not covered by their letters delivered
pursuant to subsection (a) of this Section 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
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in conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the
audited financial statements included in the Prospectus; or
(B) the unaudited capsule information, if any, included in
the Prospectus does not agree with the amounts set forth in the
unaudited consolidated financial statements from which it was
derived or was not determined on a basis substantially
consistent with that of the audited financial statements included
in the Prospectus; and
(iv) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information
included in the Prospectus and not covered by their letters delivered
pursuant to subsection (a) of this Section (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 and its
Subsidiaries subject to the internal controls of the Company's or
McDougal, Littell's accounting system or are derived directly from
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 letters and have found such dollar
amounts, percentages and other financial information to be in
agreement with such results, except as otherwise specified in such
letters.
All financial statements and schedules included in material incorporated by
reference into the Prospectus shall be deemed included in the Prospectus for the
purposes of this subsection.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as they reasonably request.
6. Indemnification and Contribution. (a) The
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Company will indemnify and hold harmless each Underwriter against any
losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus or preliminary prospectus supplement, or
arise out of or are 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, and will reimburse each
Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such loss,
claim, damage, liability or action as such expenses are incurred;
provided, however, that the Company will not be liable in any such case
(i) to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement
in or omission or alleged omission from any of such documents in reliance
upon and in conformity with written information furnished to the Company
by any Underwriter through the Representatives, if any, specifically for
use therein or (ii) if (A) any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any of such documents,
(B) such untrue statement or alleged untrue statement or omission or
alleged omission is corrected in any amendment or supplement to the
Registration Statement or the Prospectus, (C) the Company shall have
performed each of its obligations under Article VI in respect of such
amendment or supplement and (D) such Underwriter, having been furnished
by or on behalf of the Company with copies of the Prospectus as so
amended or supplemented, thereafter fails to deliver such amended or
supplemented Prospectus prior to or concurrently with the sale of
Securities to the person asserting such loss, claim, damage or liability
who purchased such Securities from such Underwriter.
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(b) Each Underwriter, severally and not jointly, agrees to indemnify
and hold harmless the Company against any losses, claims, damages or
liabilities to which the Company may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus or preliminary prospectus
supplement, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to
the extent, but only to the extent, that such 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
Underwriter through the Representatives, if any, specifically for use
therein, and will reimburse any legal or other expenses reasonably in-
curred by the Company in connection with investigating or defending any
such loss, claim, damage, liability or action as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under this Section
6 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying
party under subsection (a) or (b) above, notify the indemnifying party of
the commencement thereof; but the omission so to notify the indemnifying
party will not relieve it from any liability which it may have to any
indemnified party otherwise than under subsection (a) or (b) above except
to the extent the indemnifying party is actually prejudiced by such failure
to give notice. In case any such action is brought against any indemnified
party and it notifies the indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate therein and, to the
extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel satisfacto-
ry to such indemnified party (who shall not, except
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with the consent of the indemnified party, be counsel to the indemnifying
party), and after notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof, the indemnifying
party will not be liable to such indemnified party under this Section 6(c)
for any legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof other than reasonable costs of
investigation.
(d) If the indemnification provided for in this Section 6 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a) or (b)
above (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on
the other from the offering of the Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company
on the one hand and the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses)
received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters. The relative fault shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company or the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The amount paid by an indemnified party as a result
of the losses,
16
<PAGE>
claims, damages or liabilities referred to in the first sentence of this
Section 6(d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
Section 6(d). Notwithstanding the provisions of this Section 6(d), no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount
of any damages which such Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
The Underwriters' obligations in this Section 6(d) to contribute are
several in proportion to their respective underwriting obligations and not
joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations
of the Underwriters under this Section shall be in addition to any
liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each director of the Compa-
ny, to each officer of the Company who has signed the Registration
Statement and to each person, if any, who controls the Company within the
meaning of the Act.
(f) The information set forth in the last paragraph on the front
cover page (insofar as such information relates to the Underwriters), under
"Plan of Distribution" and "Underwriting" and the final sentence of "Use of
Proceeds" in the Prospectus constitutes the only information furnished by
the Underwriters to the Company for inclusion in the Prospectus or the
Registration Statement, and the Representatives, on behalf of the
respective Under-
17
<PAGE>
writers, represent and warrant to the Company that the statements made
therein are materially true and correct and do not omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading.
(g) The parties to this Agreement hereby acknowledge that they are
sophisticated business persons who were represented by counsel during the
negotiations regarding the provisions hereof, including without limitation
the provisions of this Section 6, and are fully informed regarding said
provisions. They further acknowledge that the provisions of this Section 6
fairly allocate the risks in light of the ability of the parties to
investigate the Company and its business in order to assure that adequate
disclosure is made in the Registration Statement and Prospectus as required
by the Act. The parties are advised that federal or state public policy,
as interpreted by the courts in certain jurisdictions, may be contrary to
certain of the provisions of this Section 6, and the parties hereto hereby
expressly waive and relinquish any right or ability to assert such public
policy as a defense to a claim under this Section 6 and further agree not
to attempt to assert any such defense.
7. Default of Underwriters. If any Underwriter or Underwriters default in
their obligations to purchase Securities under the Terms Agreement and the
aggregate principal amount of the Securities that such defaulting Underwriter or
Underwriters agreed but failed to purchase does not exceed 10% of the total
principal amount of the Securities, the Representatives may make arrangements
satisfactory to the Company for the purchase of such Securities by other
persons, including any of the Underwriters, but if no such arrangements are
made by the Closing Date, the non-defaulting Underwriters shall be obligated
severally, in proportion to their respective commitments under this Agreement
and the Terms Agreement, to purchase the Securities that such defaulting Under-
writers agreed but failed to purchase. If any Underwriter or Underwriters so
default and the aggregate principal amount of the Securities with respect to
which such default or defaults occur exceeds 10% of the total principal amount
of the Securities and arrangements satisfac-
18
<PAGE>
tory to the Representatives and the Company for the purchase of such Securities
by other persons are not made within 36 hours after such default, such Terms
Agreement will terminate without liability on the part of any non-defaulting
Underwriter or the Company, except as provided in Section 8. As used in this
Agreement, the term "Underwriter" includes any person substituted for an Under-
writer under this Section. Nothing herein will relieve a defaulting Underwriter
from liability for its default. The respective commitments of the several
Underwriters for the purposes of this Section shall be determined without regard
to reduction in the respective Underwriters' obligations to purchase the
principal amounts of the Securities set forth opposite their names in the Terms
Agreement as a result of Delayed Delivery Contracts entered into by the Company.
The foregoing obligations and agreements set forth in this Section will not
apply if the Terms Agreement specifies that such obligations and agreements will
not apply.
8. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of
the Company or its officers and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person and will survive delivery of
and payment for the Securities. If the Terms Agreement is terminated pursuant
to Section 7 or if for any reason the purchase of the Securities by the
Underwriters under the Terms Agreement is not consummated, the Company shall
remain responsible for the expenses to be paid or reimbursed by it pursuant to
Section 4 and the respective obligations of the Company and the Underwriters
pursuant to Section 6 shall remain in effect. If the purchase of the Securi-
ties by the Underwriters is not consummated for any reason other than solely
because of the termination of this Agreement pursuant to Section 7 or the
occurrence of any event specified in clause (ii), (iii), (iv) or (v) of Section
5(c), the Company will reimburse the Underwriters for all out-of-pocket expenses
(including fees and dis-
19
<PAGE>
bursements of counsel) reasonably incurred by them in connection with the
offering of the Securities.
9. Notices. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or telegraphed and confirmed to
them at their addresses furnished to the Company in writing for the purpose of
communications hereunder or, if sent to the Company, will be mailed, delivered
or telegraphed and confirmed to it at 222 Berkeley Street, Boston, Massachu-
setts 02116, Attention: Paul D. Weaver, General Counsel.
10. Successors. This Agreement will inure to the benefit of and be
binding upon the Company and such Underwriters as are identified in Terms
Agreements and their respective successors and the officers and directors and
controlling persons referred to in Section 6, and no other person will have any
right or obligation hereunder.
11. Applicable Law. This Agreement and the Terms Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York.
20
<PAGE>
Exhibit 1.2
HOUGHTON MIFFLIN COMPANY
("Company")
7 1/8% Notes Due 2004
TERMS AGREEMENT
---------------
March 28, 1994
HOUGHTON MIFFLIN COMPANY
222 Berkeley Street
Boston, MA 02116
Attention: Stephen O. Jaeger
Ladies and Gentlemen:
We hereby offer to purchase, on and subject to the terms and conditions of
the Underwriting Agreement being filed as an exhibit to the Company's Report on
Form 8-K and incorporated by reference into the registration statement on Form
S-3 (No. 33-51700)("Underwriting Agreement"), the following securities
("Securities") on the following terms:
Title: 7 1/8% Notes Due 2004.
Principal Amount: $100,000,000.
Interest: 7 1/8% per annum, from April 5, 1994, payable semiannually on
April 1 and October 1, commencing October 1, 1994 to holders of record on the
preceding March 15 or September 15 as the case may be.
Maturity: April 1, 2004
Delayed Delivery Contracts: None.
Purchase Price: 98.75% of principal amount, plus accrued interest, if any,
from April 5, 1994.
Expected Reoffering Price: 99.40% of principal amount, subject to change
by the undersigned.
Closing: 9:30 A.M. on April 5, 1994 at Skadden, Arps, Slate, Meagher &
Flom, One Beacon Street, Boston, MA 02108, in immediately available funds.
<PAGE>
Names and Addresses of Underwriters:
CS FIRST BOSTON CORPORATION
Park Avenue Plaza
New York, NY 10005
J.P. MORGAN SECURITIES INC.
60 Wall Street
New York, NY 10260
The respective principal amounts of the Securities to be purchased by each
of the Underwriters are set forth opposite their names in Schedule A hereto.
It is understood that we may, with your consent, amend this offer to add
additional Underwriters and reduce the aggregate principal amount to be
purchased by the Underwriters listed in Schedule A hereto by the aggregate
principal amount to be purchased by such additional Underwriters.
The provisions of the Underwriting Agreement are incorporated herein by
reference.
The Securities delivered to the Underwriters will be represented by a
single, global security to be deposited with The Depository Trust Company.
2
<PAGE>
Please signify your acceptance of our offer by signing the enclosed
response to us in the space provided and returning it to us.
Very truly yours,
CS FIRST BOSTON CORPORATION
J.P. MORGAN SECURITIES INC.
By CS FIRST BOSTON CORPORATION
By /s/ Louis G. Zachary
-------------------------
Louis G. Zachary
Managing Director
3
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
Principal
Underwriter Amount
- ----------- ---------
<S> <C>
CS First Boston Corporation........... $ 50,000,000
J.P. Morgan Securities Inc............ $ 50,000,000
------------
Total.............................. $100,000,000
============
</TABLE>
4
<PAGE>
To: CS FIRST BOSTON CORPORATION
J.P. MORGAN SECURITIES INC.
c/o CS First Boston Corporation,
Park Avenue Plaza,
New York, N.Y. 10055
We accept the offer contained in your letter, dated March 28, 1994 relating
to $100 million principal amount of our 7 1/8% Notes Due 2004. We also confirm
that, to the best of our knowledge after reasonable investigation, the
representations and warranties of the undersigned in the Underwriting Agreement,
which is being filed as an exhibit to the undersigned's Report on Form 8-K and
incorporated by reference into the registration statement on Form S-3 (No. 33-
51700) ("Underwriting Agreement"), are true and correct, no stop order
suspending the effectiveness of the Registration Statement (as defined in the
Underwriting Agreement) or of any part thereof has been issued and no
proceedings for that purpose have been instituted or, to the knowledge of the
undersigned, are contemplated by the Securities and Exchange Commission and,
subsequent to the respective dates of the most recent financial statements in
the Prospectus (as defined in the Underwriting Agreement), there has been no
material adverse change in the financial position or results of operations of
the undersigned and its subsidiaries except as set forth in or contemplated by
the Prospectus.
Very truly yours,
HOUGHTON MIFFLIN COMPANY
By /s/ Stephen O. Jaeger
-------------------------
Name: Stephen O. Jaeger
Title: Executive Vice President,
Chief Financial Officer and
Treasurer
<PAGE>
ANNEX I
(Three copies of this Delayed Delivery Contract
should be signed and returned to the address shown
below so as to arrive not later than 9:00 A.M.,
New York time, on ___________, ____, 1994.)
DELAYED DELIVERY CONTRACT
-------------------------
[ ], 1994
HOUGHTON MIFFLIN COMPANY
c/o CS First Boston Corporation
Park Avenue Plaza
New York, NY 10055
Attention: [Insert name of FBC Corporate Finance Officer]
Ladies and Gentlemen:
The undersigned hereby agrees to purchase from Houghton Mifflin Company, a
Massachusetts corporation ("Company"), and the Company agrees to sell to the
undersigned, [If one delayed closing, insertas of the date hereof, for
delivery on _______, 1994 ("Delivery Date"),]
$________________
principal amount of the Company's [Insert tile of securities] ("Securities"),
offered by the Company's Prospectus dated October 8, 1992 and a Prospectus
Supplement dated _____, 1994, relating thereto, receipt of copies of which is
hereby acknowledged, at ___% of the principal amount thereof plus accrued
interest, if any, and on the further terms and conditions set forth in this
Delayed Delivery Contract ("Contract").
[If two or more delayed closings, insert the following:
The undersigned will purchase from the Company as of the date hereof, for
delivery on the dates set forth
<PAGE>
below, Securities in the principal amounts set forth below:
<TABLE>
<CAPTION>
Delivery Date Principal Amount
------------- ----------------
<S> <C>
_________________ ____________
_________________ ____________
</TABLE>
Each of such delivery dates is hereinafter referred to as
a Delivery Date.]
Payment for the Securities that the undersigned has agreed to purchase for
delivery on--the--each--Delivery Date shall be made to the Company or its order
by certified or official bank check in [New York Clearing House (next day)
funds] at the office of _______________________ at ______ A.M. on--the--such--
Delivery Date upon delivery to the undersigned of the Securities to be purchased
by the undersigned--for delivery on such Delivery Date--in definitive, fully
registered form and in such denominations and registered in such names as the
undersigned may designate by written or telegraphic communication addressed to
the Company not less than five full business days prior to--the--such--Delivery
Date.
It is expressly agreed that the provisions for delayed delivery and payment
are for the sole convenience of the undersigned; that the purchase hereunder of
Securities is to be regarded in all respects as a purchase as of the date of
this Contract; that the obligation of the Company to make delivery of and accept
payment for, and the obligation of the undersigned to take delivery of and make
payment for, Securities on--the--each--Delivery Date shall be subject only to
the conditions that (1) investment in the Securities shall not at--the--such--
Delivery Date be prohibited under the laws of any jurisdiction in the United
States to which the undersigned is subject and (2) the Company shall have sold
to the Underwriters the total principal amount of the Securities less the prin-
cipal amount thereof covered by this and other similar Contracts. The
undersigned represents that its investment in the Securities is not, as of the
date hereof, prohibited under the laws of any jurisdiction to which the
undersigned is subject and which governs such investment.
Promptly after completion of the sale to the Underwriters the Company will
mail or deliver to the undersigned at its address set forth below notice to
such
7
<PAGE>
effect, accompanied by a copy of the opinion of counsel for the Company
delivered to the Underwriters in connection therewith.
This contract will inure to the benefit of and be binding upon the parties
hereto and their respective successors, but will not be assignable by either
party hereto without the written consent of the other.
It is understood that the acceptance of any such Contract is in the
Company's sole discretion and, without limiting the foregoing, need not be on a
first-come, first-served basis. If this Contract is acceptable to the Company,
it is requested that the Company sign the form of acceptance below and mail or
deliver one of the counterparts hereof to the undersigned at its address set
forth below. This will become a binding contract between the Company and the
undersigned when such counterpart is so mailed or delivered.
Yours very truly,
--------------------------------
(Name of Purchaser)
By
------------------------------
------------------------------
(Title of Signatory)
------------------------------
------------------------------
(Address of Purchaser)
Accepted, as of the above date.
HOUGHTON MIFFLIN COMPANY
By
--------------------------
Name:
Title:
8
<PAGE>
Exhibit 4.1
- --------------------------------------------------------------------------------
HOUGHTON MIFFLIN COMPANY
TO
THE FIRST NATIONAL BANK OF BOSTON
Trustee
____________
Indenture
Dated as of March 15, 1994
- --------------------------------------------------------------------------------
<PAGE>
HOUGHTON MIFFLIN COMPANY
Reconciliation and tie between Trust Indenture Act of 1939 and Indenture, dated
as of March 15, 1994
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
- ---------------- -----------------
<S> <C> <C>
(S) 310(a)(1)............................................................... 609
(a)(2)............................................................... 609
(a)(3).................................................... Not Applicable
(a)(4).................................................... Not Applicable
(b).................................................................. 608
(S) 311(a).................................................................. 610
(b).................................................................. 610
(b)(2)............................................................... 610
(S) 312(a).................................................................. 701
(b)............................................................... 702(b)
(c)............................................................... 702(c)
(S) 313(a).................................................................. 703
(b).................................................................. 703
(c).................................................................. 703
(d).................................................................. 703
(S) 314(a)....................................................... Not Applicable
(b)....................................................... Not Applicable
(c)(1)............................................................... 102
(c)(2)............................................................... 102
(c)(3).................................................... Not Applicable
(d)....................................................... Not Applicable
(e).................................................................. 102
(S) 315(a)....................................................... Not Applicable
(b)....................................................... Not Applicable
(c)....................................................... Not Applicable
(d)....................................................... Not Applicable
(d)(1).................................................... Not Applicable
(d)(2).................................................... Not Applicable
(d)(3).................................................... Not Applicable
(e).................................................................. 514
(S) 316(a).................................................................. 104
(a)(1)(A)............................................................ 502
512
(a)(1)(B)............................................................ 513
(a)(2).................................................... Not Applicable
(b).................................................................. 508
(S) 317(a)(1)............................................................... 503
(a)(2)............................................................... 504
(b)................................................................. 1003
(S) 318(a).................................................................. 108
- ---------------
</TABLE>
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Indenture.
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
-----------------
PAGE
----
<S> <C>
RECITALS OF THE COMPANY .................................................. 1
<CAPTION>
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
<S> <C> <C>
Section 101. Definitions........................................... 1
Act................................................... 2
Affiliate............................................. 2
Attributable Debt..................................... 2
Authenticating Agent.................................. 3
Board of Directors.................................... 3
Board Vote............................................ 3
Book-Entry Security................................... 3
Business Day.......................................... 3
Commission............................................ 3
Common Stock.......................................... 4
Company............................................... 4
Company Request; Company Order........................ 4
Corporate Trust Office................................ 4
corporation........................................... 4
Defaulted Interest.................................... 4
Depository............................................ 4
Dollar or $ .......................................... 4
Euro-clear............................................ 4
Event of Default...................................... 4
Exchange Date......................................... 5
Funded Debt........................................... 5
Global Security....................................... 5
Holder................................................ 5
-------------
</TABLE>
NOTE: This table of contents shall not, for any purpose, be deemed to be a part
of the Indenture.
i
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Indenture............................................. 5
interest.............................................. 5
Interest Payment Date................................. 5
Maturity.............................................. 5
Officers' Certificate................................. 5
Opinion of Counsel.................................... 6
Original Issue
Discount Security. ................................... 6
Outstanding........................................... 6
Paying Agent.......................................... 7
Person................................................ 7
Place of Payment...................................... 7
Predecessor Security.................................. 7
Principal; principal amount........................... 8
Redemption Date....................................... 8
Redemption Price...................................... 8
Registered Security................................... 8
Regular Record Date................................... 8
Responsible Officer................................... 8
Securities............................................ 9
Security Register..................................... 9
Security Registrar.................................... 9
Special Record Date................................... 9
Stated Maturity....................................... 9
Subsidiary............................................ 9
Trustee............................................... 9
Trust Indenture Act................................... 10
United States......................................... 10
United States Alien................................... 10
U.S. Government Obligations..... ..................... 10
Vice President........................................ 11
Yield to Maturity..................................... 11
Section 102. Compliance Certificates and Opin-
ions.................................................. 11
Section 103. Form of Documents Delivered to
Trustee............................................... 12
Section 104. Acts of Holders....................................... 12
Section 105. Notices, Etc., to Trustee and
Company............................................... 16
Section 106. Notice to Holders of Securities;
Waiver................................................ 17
Section 107. Language of Notices, Etc.............................. 18
Section 108. Conflict with Trust Indenture Act..................... 18
Section 109. Effect of Headings and Table of
Contents.............................................. 18
Section 110. Successors and Assigns................................ 18
Section 111. Separability Clause................................... 18
Section 112. Benefits of Indenture................................. 18
Section 113. Governing Law......................................... 18
Section 114. Legal Holidays........................................ 19
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
ARTICLE II
SECURITY FORMS
<S> <C> <C>
Section 201. Forms Generally....................................... 19
Section 202. Form of Trustee's Certificate of
Authentication........................................ 20
Section 203. Securities in Global Form............................. 20
Section 204. Form of Legend for Book-Entry
Securities............................................ 21
Section 205. Additional Provisions Required in
Global Security....................................... 22
<CAPTION>
ARTICLE III
THE SECURITIES
<S> <C> <C>
Section 301. Amount Unlimited; Issuable in
Series................................................ 22
Section 302. Denominations......................................... 26
Section 303. Execution, Authentication, Deliv-
ery and Dating........................................ 26
Section 304. Temporary Securities.................................. 28
Section 305. Registration, Registration of
Transfer and Exchange................................. 31
Section 306. Mutilated, Destroyed, Lost and
Stolen Securities..................................... 34
Section 307. Payment of Interest; Interest
Rights Preserved...................................... 35
Section 308. Persons Deemed Owners................................. 37
Section 309. Cancellation.......................................... 37
Section 310. Computation of Interest............................... 38
Section 311. Electronic Security Issuance.......................... 38
<CAPTION>
ARTICLE IV
SATISFACTION AND DISCHARGE
<S> <C> <C>
Section 401. Satisfaction and Discharge of
Indenture............................................. 39
Section 402. Application of Trust Money............................ 40
Section 403. Satisfaction, Discharge and De-
feasance of Securities of any
Series................................................ 41
</TABLE>
iii
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
ARTICLE V
REMEDIES
<S> <C> <C>
Section 501. Events of Default..................................... 44
Section 502. Acceleration of Maturity; Rescis-
sion and Annulment.................................... 46
Section 503. Collection of Indebtedness and
Suits for Enforcement by Trustee...................... 48
Section 504. Trustee May File Proofs of Claim...................... 49
Section 505. Trustee May Enforce Claims With-
out Possession of Securities.......................... 50
Section 506. Application of Money Collected........................ 50
Section 507. Limitation on Suits................................... 51
Section 508. Unconditional Right of Holders to
Receive Principal, Premium and
Interest.............................................. 52
Section 509. Restoration of Rights and Reme-
dies.................................................. 52
Section 510. Rights and Remedies Cumulative........................ 52
Section 511. Delay or Omission Not Waiver.......................... 53
Section 512. Control by Holders of Securities...................... 53
Section 513. Waiver of Past Defaults............................... 54
Section 514. Undertaking for Costs................................. 55
Section 515. Waiver of Stay or Extension Laws...................... 55
<CAPTION>
ARTICLE VI
THE TRUSTEE
<S> <C> <C>
Section 601. Certain Rights of Trustee............................. 56
Section 602. Not Responsible for Recitals or
Issuance of Securities............................... 57
Section 603. May Hold Securities................................... 57
Section 604. Money Held in Trust................................... 58
Section 605. Compensation and Reimbursement........................ 58
Section 606. Resignation and Removal; Appoint-
ment of Successor..................................... 59
Section 607. Acceptance of Appointment by Suc-
cessor................................................ 61
Section 608. Disqualification; Conflicting
Interests............................................. 62
Section 609. Corporate Trustee Required; Eli-
gibility.............................................. 62
Section 610. Preferential Collection of Claims
Against Company....................................... 63
Section 611. Merger, Conversion, Consolidation
or Succession to Business............................. 63
Section 612. Appointment of Authenticating
Agent................................................. 63
</TABLE>
iv
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
<S> <C> <C>
Section 701 Company to Furnish Trustee Names
and Addresses of Holders.............................. 66
Section 702. Preservation of Information; Com-
munications to Holders................................ 66
Section 703. Reports by Trustee.................................... 68
<CAPTION>
ARTICLE VIII
CONSOLIDATION, MERGER, SALE, LEASE, TRANSFER
OR OTHER DISPOSITION
<S> <C> <C>
Section 801. Company May Consolidate, Etc. Only on Certain Terms... 69
Section 802. Successor Substituted................................. 70
ARTICLE IX
SUPPLEMENTAL INDENTURES
<S> <C> <C>
Section 901. Supplemental Indentures Without
Consent of Holders.................................... 71
Section 902. Supplemental Indentures with Con-
sent of Holders....................................... 72
Section 903. Execution of Supplemental Inden-
tures................................................. 74
Section 904. Effect of Supplemental Indentures..................... 75
Section 905. Conformity with Trust Indenture
Act................................................... 75
Section 906. Reference in Securities to Sup-
plemental Indentures.................................. 75
<CAPTION>
ARTICLE X
COVENANTS
<S> <C> <C>
Section 10001. Payment of Principal, Premium and
Interest.............................................. 76
Section 10002. Maintenance of Office or Agency....................... 76
Section 10003. Money for Securities Payments to
Be Held in Trust...................................... 77
Section 10004. Additional Amounts.................................... 78
Section 10005. Existence............................................. 79
Section 10006. [Intentionally Omitted]............................... 79
Section 10007. Limitation on Liens................................... 79
Section 10008. Limitation on Sale and Lease-Back
Transactions.......................................... 81
</TABLE>
v
<PAGE>
PAGE
----
<TABLE>
<CAPTION>
<S> <C> <C>
Section 10009. Statement by Officers as to De-
fault................................................. 81
Section 10010. Waiver of Certain Covenants........................... 82
Section 10011. Defeasance of Certain Obligations..................... 82
<CAPTION>
ARTICLE XI
REDEMPTION OF SECURITIES
<S> <C> <C>
Section 1101. Applicability of Article.............................. 85
Section 1102. Election to Redeem; Notice to
Trustee............................................... 85
Section 1103. Selection by Trustee of Securi-
ties to Be Redeemed................................... 85
Section 1104. Notice of Redemption.................................. 86
Section 1105. Deposit of Redemption Price........................... 87
Section 1106. Securities Payable on Redemption
Date.................................................. 87
Section 1107. Securities Redeemed in Part........................... 88
<CAPTION>
ARTICLE XII
SINKING FUNDS
<S> <C> <C>
Section 1201. Applicability of Article.............................. 88
Section 1202. Satisfaction of Sinking Fund Pay-
ments with Securities................................. 89
Section 1203. Redemption of Securities for
Sinking Fund.......................................... 89
Exhibit A. Form of Registered Security Which
Is Not An Original Issue Discount
Security.............................................. A 1
Exhibit B. Form of Registered Security Which
Is An Original Issue Discount
Security.............................................. B 1
Exhibit C. Forms of Certification................................C.1-1
</TABLE>
vi
<PAGE>
INDENTURE, dated as of March 15, 1994, between Houghton Mifflin Company,
a corporation duly organized and existing under the laws of the Commonwealth
of Massachusetts (herein called the "Company"), having its principal office
at One Beacon Street, Boston, Massachusetts 02108, and The First National Bank
of Boston, a national banking association, 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 "Secu-
rities"), 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 agreed, for the equal and proportionate
benefit of all Holders of the Securities or of a series thereof, as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
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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;
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(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;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States of America, and, except as otherwise herein
expressly provided, the term "generally accepted accounting principles"
with respect to any computation required or permitted hereunder shall mean
such accounting principles as are generally accepted in the United States
of America at the date of this instrument; and
(4) the words "herein", "hereof" and "hereunder" and other words of
similarly 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 of a Security, 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" shall mean, at the time of determination, the present
value (discounted at the interest rate, compounded semiannually, equal to the
weighted average Yield to Maturity of the Securities then Outstanding hereunder,
such average being weighted by the principal amount of the Securities of each
series or, in the case of Original Issue Discount Securities, such
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amount to be determined as provided in the definition of "Outstanding") of the
obligation of a lessee for net rental payments during the remaining term of any
lease (including any period for which such lease has been extended) entered into
in connection with a sale and lease-back transaction.
"Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 612 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 Vote" means a copy of a vote certified by the Secretary and Clerk or
by an Assistant Clerk 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.
"Book-Entry Security" means a Security bearing the legend specified in
Section 204, evidencing all or part of a series of Securities, issued to the
Depository for such series or its nominee, and registered in the name of such
Depository or nominee. Book-Entry Securities shall not be deemed to be
securities in global form for purposes of Sections 201 and 203 and Article
Three of the Indenture.
"Business Day", when used with respect to any Place of Payment or any other
particular location referred to in this Indenture or in the Securities, means
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on
which banking institutions in that Place of Payment or other location are
authorized or obligated by law or executive order 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.
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"Common Stock" includes any stock of any class of the Company which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Company
and which is not subject to redemption by the Company.
"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 Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board and President or
a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary
and Clerk or by an Assistant Clerk, and delivered to the Trustee.
"Corporate Trust Office" means the principal office of the Trustee at which
at any particular time its corporate trust business shall be administered.
"corporation" means a corporation, association, company, joint-stock
company or business trust.
"Defaulted Interest" has the meaning specified in Section 307.
"Depository" means, with respect to the Securities of any series issuable
or issued in whole or in part in the form of one or more Book-Entry Securities,
the clearing agency registered under the Securities Exchange Act of 1934, as
amended, specified for that purpose as contemplated by Section 301.
"Dollar" or "$" means a dollar or other equivalent unit in such coin or
currency of the United States of America as at the time shall be legal tender
for the payment of public and private debts.
"Euro-clear" means the operator of the Euro-clear System.
"Event of Default" has the meaning specified in Section 501.
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"Exchange Date" has the meaning specified in Section 304.
"Funded Debt" shall mean indebtedness for money borrowed which by its terms
matures at, or is extendible or renewable at the option of the obligor, to a
date more than twelve months after the date of the creation of such
indebtedness.
"Global Security" means a Security in the form prescribed in Section 205
evidencing all or part of a series of Securities, issued to the Depository for
such series or its nominee, and registered in the name of such Depository or
nominee.
"Holder", when used with respect to any Security, means in the case of a
Registered Security, the Person in whose name the Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed or 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 and shall
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 installment of interest on such Security.
"Maturity", when used with respect to any Security, means the date on which
the principal of such Security or an installment of principal becomes due and
payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board and the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary and Clerk or by an Assistant Clerk, of the
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Company, and delivered to the Trustee. One of the Officers signing an
Officers' Certificate given pursuant to Section 1009 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, and who shall be reasonably acceptable to the Trustee.
"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 appertaining thereto; 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;
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provided, however, that in determining whether the Holders of the requisite
- -------- -------
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder (i) 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 pursuant to Section 502, and (ii) 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 or waiver, 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 any premium and interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, 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, subject to the provisions of Section 1002, the
principal of and any premium and interest on the Securities of that series are
payable as specified as contem-plated 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
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost
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or stolen Security shall be deemed to evidence the same debt as the mutilated,
destroyed, lost or stolen Security.
"Principal" or "principal amount" means, with respect to (a) any security
that is not (1) an Original Issue Discount Security or (2) an Original Issue
Discount Security with respect to which interest has commenced accruing at
regularly scheduled intervals and not as a result of any failure to pay amounts
due as a result of acceleration of maturity, redemption or repurchase, the
stated principal amount of such Security due at maturity [plus the premium, if
any, on such Security] and (b) with respect an any Original Issue Discount
Security, except as provided in clause (a) above, with respect to (1) the
determination of Holders entitled to Act with respect to any matter, the amount
of principal of such Securities payable as of the date of determination upon
acceleration of Maturity and (2) any amount to be paid with respect to such
Securities other than (A) amounts payable after the date on which original issue
discount ceases to accrete as described in clause (a)(2) above or (B) at
maturity (and other than interest, if any, or premium, if any, thereon), the
accreted value of such Securities as of the date of payment.
"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.
"Registered Security" means any Security in the form set forth in either
Exhibit A or Exhibit B to this Indenture or established pursuant to Section 201
which is registered in the Security Register.
"Regular Record Date" for the interest payable on any Interest Payment Date
on the Registered 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 any
officer in the Corporate Trust Department or any other officer of the Trustee
customarily
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performing functions similar to those performed by any of such officers and also
means, with respect to a particular corporate trust matter, any other officer
of the Trustee to whom such matter is referred because of his knowledge of and
familiarity with the particular subject.
"Securities" has the meaning stated in the first recital of this Indenture
and more particularly means any Securities authenticated and delivered under
this Indenture.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Special Record Date" for the payment of any Defaulted Interest on the
Registered Securities of any series means a date fixed by the Trustee pursuant
to Section 307.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such installment of principal or interest is due and payable.
"Subsidiary" shall mean any corporation of which at least a majority of the
outstanding stock having by the terms thereof ordinary voting power to elect a
majority of the board of directors of such corporation (whether or not at the
time stock of any other class or classes of such corporation shall have or might
have voting power by reason of the happening of any contingency) is at the time
directly or indirectly owned or controlled by the Company, or by one or more
Subsidiaries, or by the Company and one or more Subsidiaries.
"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.
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"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.
"United States" means the United States of America (including the States
and the District of Columbia), its territories, its possessions and other areas
subject to its jurisdiction.
"United States Alien" means any Person who, for United States Federal
income tax purposes, is a foreign corporation, a non-resident alien individual,
a non-resident alien fiduciary of a foreign estate or trust, or a foreign
partnership one or more of the members of which is, for United States Federal
income tax purposes, a foreign corporation, a non-resident alien individual or a
non-resident alien fiduciary of a foreign estate or trust.
"U.S. Government Obligations" means direct obligations of the United
States for the payment of which its full faith and credit is pledged, or
obligations of a person controlled or supervised by and acting as an agency or
instrumentality of the United States and the payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States which, in
either case, are not callable or redeemable at the option of the issuer thereof,
and shall also include a depository receipt issued by a bank (as defined in Sec-
tion 3(a)(2) of the Securities Act of 1933, as amended) as custodian with
respect to any such U.S. Government Obligations or a specific payment of or
interest on any such U.S. Government Obligations held by such custodian for the
account of the holder of such depository receipt, provided that (except as
required by law) such custodian is not authorized to make any deduction from the
amount payable to the holder of such depository receipt from any amount received
by the custodian in respect of the U.S. Government Obligations or the specific
payment of principal of or interest on the U.S. Government Obligations
evidenced by such depository receipt.
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"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".
"Yield to Maturity" means the yield to maturity on a series of securities,
calculated at the time of issuance of such series, or, if applicable, at the
most recent redetermination of interest on such series, and calculated in
accordance with accepted financial practice.
SECTION 102. Compliance Certificates and Opinions.
------------------------------------
Except as otherwise expressly provided by this Indenture, upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent, if any, provided
for in this Indenture relating to the proposed action have been complied with
and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, except that in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture except for certificates provided for
in Section 1009 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
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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 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 representa-
tions 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 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.
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(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided or
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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 an agent duly appointed in writing. Except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee and, where it is
herein expressly required, to the Company. Such instrument or instruments and
any such record (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 or proxy, or of the holding by any Person of a
Security, 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.
(c) The principal amount and serial numbers of Registered Securities
held by any Person, and the date of holding the same, 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
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such action is made upon such Security. Nothing in this Section 104(d) shall be
construed to limit the right of Holders to take action which shall bind Holders
of all Securities as expressly provided herein.
(e) With respect to the Securities of any Series all or part of which
are represented by Book-Entry Securities, the following provisions shall apply:
(1) Upon receipt by the Trustee of (i) any written notice directing
the time, method or place of conducting any proceeding or exercising any
trust or power pursuant to Section 512 with respect to Securities of such
series or (ii) any written demand, request or notice with respect to any
matter on which the Holders of Securities of such series are entitled to
act under this Indenture, in each case from Holders of less than, or
proxies representing less than, the requisite principal amount of
Outstanding Securities or such series entitled to give such demand, request
or notice, the Trustee shall establish a record date for determining
Holders of Outstanding Securities of such series entitled to join in such
demand, request or notice, which record date shall be the close of business
on the day the Trustee received such demand, request or notice. The
Holders on such record date, or their duly designated proxies, and only
such Persons, shall be entitled to join in such demand, request or notice
whether or not such Holders remain Holders after such record date; provid-
ed, however, that unless the Holders of the requisite principal amount of
Outstanding Securities of such series shall have joined in such demand,
request or notice prior to the day which is the 90th day after such record
date, such demand, request or notice shall automatically and without
further action by any Holder be canceled and of no further effect. Nothing
in this paragraph shall prevent a Holder, or a proxy of a Holder, from
giving, (i) after the expiration of such 90-day period, a new demand,
request or notice identical to a demand, request or notice which has been
canceled pursuant to the proviso to the preceding sentence or
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(ii) during any such 90-day period, a new demand, request or notice which
has been canceled pursuant to the proviso to the preceding sentence or
(iii) during any such 90-day period, a new demand, request or notice
contrary to or different from such demand, request or notice, in either of
which events a new record date shall be established pursuant to the
provisions of this clause (1).
(2) The Company may, but shall not be obligated to, direct the
Trustee to establish a record date for the purpose of determining the
Persons entitled to (i) waive any past default with respect to the
Securities of such series in accordance with Section 513 of the Indenture,
(ii) consent to any supplemental indenture in accordance with Section 902
of the Indenture or (iii) waive any term, condition or provision of any
covenant in accordance with Section 1010 of the Indenture. If a record
date is fixed, the Holders on such record date, or their duly designated
proxies, and only such Persons, shall be entitled to waive any such past
default, consent to any such supplemental indenture or waive any such term,
condition or provision, whether or not such Holder remains a Holder after
such record date; provided, however, that unless such waiver or consent is
obtained from the Holders, or duly designed proxies, of the requisite
principal amount of Outstanding Securities of such series prior to the
date which is the 90th day after such record date, any such waiver or
consent previously given shall automatically and without further action by
any Holder be canceled and of no further effect.
(f) The Company may, in the circumstances permitted by the Trust
Indenture Act, set any day as the record date for the purpose of determining the
Holders of Outstanding Securities of any series entitled to give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Indenture to be given or taken by Holders
of Securities of such series. With regard to any record date set pursuant to
this paragraph, the Holders
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of Outstanding Securities of the relevant series on such record date (or their
duly appointed agents), and only such Persons, shall be entitled to give or take
the relevant action, whether or not such Holders remain Holders after such
record date. With regard to any action that may be given or taken hereunder
only by Holders of a requisite principal amount of Outstanding Securities of any
series (or their duly appointed agents) and for which a record date is set
pursuant to this paragraph, the Company may, at its option, set an expiration
date after which no such action purported to be given or taken by any Holder
shall be effective hereunder unless given or taken on or prior to such
expiration date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date (or their duly appointed agents).
On or prior to any expiration date set pursuant to this paragraph, the Company
may, on one or more occasions at its option, extend such date to any later date.
Nothing in this paragraph shall prevent any Holder (or any duly appointed agent
thereof) from giving or taking, after any expiration date, any action identical
to, or, at any time, contrary to or different from, any action given or taken,
or purported to have been given or taken, hereunder by a Holder on or prior to
such date, in which event the Company may set a record date in respect thereof
pursuant to this paragraph. Notwithstanding the foregoing or the Trust Inden-
ture Act, the Company shall not set a record date for, and the provisions of
this paragraph shall not apply with respect to, any action to be given or taken
by Holders pursuant to Section 501, 502 or 512.
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: Houghton
Mifflin Company 1992 Indenture, or
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(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, to the attention of its Executive Vice
President and Chief Financial Officer and its Secretary and Clerk, or at
any other address previously furnished in writing to the Trustee by the
Company.
SECTION 106. Notice to Holders of Securities; Waiver.
---------------------------------------
Except as otherwise expressly provided herein, where this Indenture
provides for notice to Holders of Securities of any event, such notice shall be
sufficiently given to holders of Registered Securities if in writing and mailed,
first-class postage prepaid, to each Holder of a Registered Security affected by
such event, at the address of such Holder as it appears in the Security
Register, not earlier than the earliest date, and not later than the latest
date, prescribed for the giving of such notice.
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 to Holders of
Registered Securities by mail, then such notification as shall be made with the
approval of the Trustee shall constitute sufficient notice to such Holders for
every purpose hereunder. In any case where notice to Holders of Registered
Securities is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder of a Registered
Security shall affect the sufficiency of such notice with respect to other
Holders of Registered Securities.
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 of Securities 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.
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SECTION 107. Language of Notices, Etc.
-------------------------
Any request, demand, authorization, direction, notice, consent or waiver
required or permitted under this Indenture shall be in the English language.
SECTION 108. Conflict with Trust Indenture Act.
---------------------------------
If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required to be included in this Indenture by any of
the provisions of the Trust Indenture Act, such required provision shall
control.
SECTION 109. 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 110. 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 111. Separability Clause.
-------------------
In case any provision in this Indenture or the Securities shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
SECTION 112. Benefits of Indenture.
---------------------
Nothing in this Indenture or the Securities express or implied, shall give
to any Person, other than the parties hereto, their successors hereunder and the
Holders of Securities, any benefit or any legal or equitable right, remedy or
claim under this Indenture.
SECTION 113. Governing Law.
-------------
This Indenture and the Securities shall be governed by and construed in
accordance with the laws of the State of New York without regard to conflicts of
laws.
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SECTION 114. 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 in the Securities of any series 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 on the amount so payable for the period from and
after such Interest Payment Date, Redemption Date or Stated Maturity, as the
case may be.
ARTICLE II
SECURITY FORMS
SECTION 201. Forms Generally.
---------------
The Registered Securities, if any, of each series shall be in substantially
the forms set forth in Exhibits A or B to this Indenture, or in such other form
(including temporary or permanent global form) as shall be established by or
pursuant to a Board Vote or in one or more indentures supplemental hereto, in
each case with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution of the Secu-
rities. If temporary Securities of any series are issued in global form as
permitted by Section 304, the form thereof shall be established as provided in
the preceding sentence. If the forms of Securities of any series (or any such
temporary global Security) are established by action taken pursuant to a Board
Vote, a copy of an appropriate record of such action shall be certified by
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the Secretary and Clerk or by an Assistant Clerk 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 (or any such
temporary global Security).
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 Trustee's Certificate of Authentication.
------------------------------------------------
The Trustee's certificates of authentication shall be in substantially the
following form:
This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
------------------------
As Trustee
By
--------------------------
Authorized Signatory
SECTION 203. Securities in Global Form.
-------------------------
If Securities of a series are issuable in global form, as contemplated by
Section 301, then, notwithstanding clause (11) of Section 301 and the
provisions of Section 302, any such Security shall represent such of the
Outstanding Securities of such series as shall be specified therein and may
provide that it shall represent the aggregate amount of Outstanding Securities
from time to time endorsed thereon and that the aggregate amount of Outstanding
Securities represented thereby may from time to time be reduced to reflect
exchanges. Any endorsement of a Security in global form to reflect the amount,
or any increase or decrease in the amount, of Outstanding Securities represented
thereby shall be made by the Trustee in such manner and upon instructions given
by such Person or Persons as shall be specified therein or
20
<PAGE>
in the Company Order to be delivered to the Trustee pursuant to Section 303 or
Section 304. Subject to the provisions of Section 303 and, if applicable,
Section 304, the Trustee shall deliver and redeliver any Security in permanent
global form in the manner and upon instructions given by the Person or Persons
specified therein or in the applicable Company Order. If a Company Order
pursuant to Section 303 or 304 has been, or simultaneously is, delivered, any
instructions by the Company with respect to endorsement or delivery or
redelivery of a Security in global form shall be in writing but need not comply
with Section 102 and need not be accompanied by an Opinion of Counsel.
The provisions of the last sentence of Section 303 shall apply to any
security represented by a Security in global form if such Security was never
issued and sold by the Company and the Company delivers to the Trustee the
Security in global form together with written instructions (which need not
comply with Section 102 and need not be accompanied by an Opinion of Counsel)
with regard to the reduction in the principal amount of Securities represented
thereby, together with the written statement contemplated by the last sentence
of Section 303.
Notwithstanding the provisions of Sections 201 and 307, unless otherwise
specified as contemplated by Section 301, payment of principal of and any
premium and interest on any Security in permanent global form shall be made to
the Person or Persons specified therein.
Notwithstanding the provisions of Section 308 and except as provided in the
preceding paragraph, the Company, the Trustee and any agent of the Company and
the Trustee shall treat a Person as the Holder of such principal amount of
Outstanding Securities represented by a permanent global Security as shall be
specified in a written statement of the Holder of such permanent global
Security.
SECTION 204. Form of Legend for Book-Entry Securities.
----------------------------------------
Any Book-Entry Security authenticated and delivered hereunder shall bear a
legend in substantially the following form:
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"This Security is a Book-Entry Security within the meaning of the Indenture
hereinafter referred to and is registered in the name of a Depository or a
nominee of a Depository. This Security is exchangeable for Securities
registered in the name of a Person other than the Depository or its nominee
only in the limited circumstances described in the Indenture, and no transfer of
this Security (other than a transfer of this Security as a whole by the
Depository to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository) may be registered except in
such limited circumstances."
SECTION 205. Additional Provisions Required in Global Security.
-------------------------------------------------
Any Global Security issued hereunder shall, in addition to the provisions
contained in Sections 202 and 203, 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 Depository or a
nominee of a Depository. This Security is exchangeable for Securities
registered in the name of a person other than the Depository or its nominee
only in the limited circumstances described in the Indenture and may not be
transferred except as a whole by the Depository to a nominee of the Depository
or by a nominee of the Depository to the Depository or another nominee of the
Depository."
ARTICLE III
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.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Vote 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:
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(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from all other Securities);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered under
this Indenture (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) whether any Securities of the series are to be issuable
initially in temporary global form and whether any Securities of the series
are to be issuable in permanent global form and, if so, whether beneficial
owners of interests in any such permanent global Security may exchange such
interests for Securities of such series and of like tenor of any authorized
form and denomination and the circumstances under which any such exchanges
may occur, if other than in the manner provided in Section 305;
(4) the Person to whom any interest on any Registered 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, and the
extent to which, or the manner in which, any interest payable on a
temporary global Security on an Interest Payment Date will be paid if other
than in the manner provided in Section 304;
(5) the date or dates on which the principal of the Securities of
the series is payable;
(6) the rate or rates at which the Securities of the series shall
bear interest,
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if any, or the formula pursuant to which such rate or rates shall be
determined, the date or dates from which any such interest shall accrue,
the Interest Payment Dates on which any such interest shall be payable, the
Regular Record Date for any interest payable on any Registered Securities
on any Interest Payment Date;
(7) the place or places where, subject to the provisions of
Sections 114 and 1002, the principal of and any premium and interest on
Securities of the series shall be payable, any Securities of the series may
be surrendered for registration of transfer, Securities of the series may
be surrendered for exchange, and notices and demands to or upon the Company
in respect of the Securities of the series and this Indenture may be
served;
(8) the period or periods within which, the price or prices at
which and the terms and conditions upon which Securities of the series may
be redeemed, in whole or in part, at the option of the Company;
(9) the period or periods within which, the price or prices at
which and the terms and conditions upon which Securities of the series may
be redeemed, in whole or in part, at the option of the Holders pursuant to
Article Eleven, or such terms and conditions as shall be set forth in an
Officers' Certificate or supplemental indenture;
(10) the obligation, if any, of the Company to redeem or purchase
Securities of the series, or particular Securities within the Series,
pursuant to any sinking fund or analogous provisions or at the option of a
Holder thereof, including without limitation pursuant to Article Eleven,
and the period or periods within which, the price or prices at which and
the terms and conditions upon such Securities shall be redeemed or
purchased, in whole or in part, pursuant to such obligation;
24
<PAGE>
(11) the denominations in which any Registered Securities of the
series shall be issuable, if other than denominations of $1,000 and any
integral multiple thereof;
(12) if other than the 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;
(13) the Person who shall be the Security Registrar, if other than
the Company;
(14) whether the Securities of the series shall be issued upon
original issuance in whole or in part in the form of one or more Book-Entry
Securities and, in such case, (a) the Depository with respect to such
Book-Entry Security or Securities; and (b) the circumstances under which
any such Book-Entry Security may be exchanged for Securities registered
in the name of, an any transfer of such Book-Entry Security may be
registered to, a Person other than such depository or its nominee, if
other than as set forth in section 305;
(15) if either or both of the provisions of Section 403 or 1011 are
applicable to the Securities of such series; and
(16) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture).
All Securities of any one series shall be substantially identical except,
in the case of Registered Securities, as to denomination and except as may
otherwise be provided in or pursuant to the Board Vote referred to above and
(subject to Section 303) set forth 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 Vote, a copy of an appropriate record of such action shall be
certified by the Secretary and Clerk or by an Assistant Clerk of the
25
<PAGE>
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.
-------------
Unless otherwise provided as contemplated by Section 301 with respect to
any series of Securities, any Registered Securities of a 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 and President or one of its Vice Presidents, under its corporate
seal reproduced thereon attested by its Secretary and Clerk or one of its
Assistant Clerks. 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 forms or terms of the Securities of the series have been established
in or pursuant to one or more Board Votes as permitted by Sections 201 and 301,
in authenticating such Securities, and accepting the additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and (subject to Section 601) shall be
fully protected in relying upon, an Opinion of Counsel stating:
26
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(a) if the forms of such Securities have been established by or
pursuant to Board Vote as permitted by Section 201, that such forms have 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 Vote 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, as to enforcement, to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting the enforcement of
creditors' rights and to general equity principles.
If such forms or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue or 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 two preceding
paragraphs, 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 paragraphs at or prior to the time
of 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 Registered Security shall be dated the date of its authentication.
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
27
<PAGE>
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. 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 together with a written
statement (which need not comply with Section 102 and need not be accompanied
by an Opinion of Counsel) stating that such Security has never been issued and
sold by the Company, for all purposes of this Indenture such Security shall be
deemed never to have been authenticated and delivered hereunder and shall 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, in registered form 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.
Except in the case of temporary Securities in global form (which shall be
exchanged in accordance with the provisions of the following paragraphs), 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 maintained pursuant to Section 1002 in a Place of Payment for such
series for the purpose of exchanges of Securities of such series, without charge
to the Holder. Upon surrender for cancellation of any one or more temporary
Securities of any series the Company
28
<PAGE>
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a like aggregate principal amount of definitive Securities of the same
series and of like tenor of authorized denominations.
If temporary Securities of any series are issued in global form, any such
temporary global Security shall, unless otherwise provided therein, be delivered
to the London office of a depository or common depository (the "Common
Depository"), for the benefit of Euro-clear and CEDEL S.A., for credit to the
respective accounts of the beneficial owners of such Securities (or to such
other accounts as they may direct).
Without unnecessary delay but in any event not later than the date
specified in, or determined pursuant to the terms of, any such temporary global
Security (the "Exchange Date"), the Company shall deliver to the Trustee
definitive Securities of that series, in aggregate principal amount equal to
the principal amount of such temporary global Security, executed by the
Company. On or after the Exchange Date such temporary global Security shall be
surrendered by the Common Depository to the Trustee, as the Company's agent for
such purpose, to be exchanged, in whole or from time to time in part, for
definitive Securities of such series without charge and the Trustee shall
authenticate and deliver, in exchange for each portion of such temporary global
Security, a like aggregate principal amount of definitive Securities of the same
series of authorized denominations and of like tenor as the portion of such
temporary global Security to be exchanged; provided, however, that, unless
otherwise specified in such temporary global Security, upon such presentation by
the Common Depository, such temporary global Security is accompanied by a
certificate dated the Exchange Date or a subsequent date and signed by Euro-
clear as to the portion of such temporary global Security held for its account
then to be exchanged and a certificate dated the Exchange Date or a subsequent
date and signed by CEDEL S.A. as to the portion of such temporary global
Security held for its account then to be exchanged each in the form set forth in
Exhibit C.2 to this Indenture. The definitive Securities to be delivered in
exchange for any such temporary global Security shall be in registered form or
permanent global registered form, or any combination thereof, as specified as
contemplated by Section 301, and, if any combination
29
<PAGE>
thereof is so specified, as requested by the beneficial owner thereof.
Unless otherwise specified in such temporary global Security, the interest
of a beneficial owner of Securities of a series in a temporary global Security
shall be exchanged for definitive Securities of the same series and of like
tenor following the Exchange Date when the account holder instructs Euro-clear
or CEDEL S.A., as the case may be, to request such exchange on its behalf and
delivers to Euro-clear or CEDEL S.A., as the case may be, a certificate in the
form set forth in Exhibit C.1 to this Indenture, dated no earlier than 15 days
prior to the Exchange Date, copies of which certificate shall be available from
the offices of Euro-clear and CEDEL S.A., the Trustee, any Authenticating Agent
appointed for such series of Securities and each Paying Agent. Unless otherwise
specified in such temporary global Security, any such exchange shall be made
free of charge to the beneficial owners of such temporary global Security,
except that a Person receiving definitive Securities must bear the cost of
insurance, postage, transportation and the like in the event that such Person
does not take delivery of such definitive Securities in person at the offices of
Euro-clear or CEDEL S.A.
Until exchanged in full as hereinabove provided, the temporary Securities
of any series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of the same series and of like tenor
authenticated and delivered hereunder, except that, unless otherwise specified
as contemplated by section 301, interest payable on a temporary global Security
on an Interest Payment Date for Securities of such series occurring prior to the
applicable Exchange Date shall be payable to Euro-clear and CEDEL S.A. on such
Interest Payment Date upon delivery by Euro-clear and CEDEL S.A. to the Trustee
of a certificate or certificates in the form set forth in Exhibit C.3 to this
Indenture, for credit without further interest on or after such Interest Payment
Date to the respective accounts of the Persons who are the beneficial owners of
such temporary global Security on such Interest Payment Date and who have each
delivered to Euro-clear or CEDEL S.A., as the case may be, a certificate in the
form set forth in Exhibit C.4 to this Indenture. Any interest so received by
Euro-clear and CEDEL S.A. and not paid as herein provided shall be
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<PAGE>
returned to the Trustee immediately prior to the expiration of two years after
such Interest Payment Date in order to be repaid to the Company in accordance
with Section 1003.
SECTION 305. Registration, Registration of Transfer and Exchange.
---------------------------------------------------
The Company shall cause to be kept at an office or agency to be maintained
by the Company in accordance with Section 1002 a register (being the combined
register of the Security Registrar and all transfer agents designated pursuant
to Section 1002 for the purpose of registration of transfer of Securities and
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 Registered Securities and the registration of transfers
of Registered Securities. The Trustee is hereby appointed "Security
Registrar" for the purpose of registering Registered Securities and transfers of
Registered Securities as herein provided.
Upon due surrender for registration of transfer of any Registered Security
of any series at the office or agency of the Company maintained pursuant to
Section 1002 for such purpose in a Place of Payment for such series, the Company
shall execute, and the Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Registered Securi-
ties of the same series of any authorized denominations and of a like aggregate
principal amount and tenor.
At the option of the Holder, Registered Securities of any series may be
exchanged for other Registered Securities of the same series of any authorized
denominations and of a like aggregate principal amount and tenor, upon
surrender of the Securities to be exchanged at any 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.
Notwithstanding the foregoing, except as otherwise specified as
contemplated by Section 301, any permanent global Security shall be exchangeable
only as provided in
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this paragraph. If the beneficial owners of interests in a permanent global
Security are entitled to exchange such interests for Securities of such series
and of like tenor and principal amount of another authorized form and
denomination, as specified as contemplated by Section 301, then without
unnecessary delay but in any event not later than the earliest date on which
such interests may be so exchanged, the Company shall deliver to the Trustee
definitive Securities of that series in aggregate principal amount equal to the
principal amount of such permanent global Security, executed by the Company. On
or after the earliest date on which such interests may be so exchanged, such
permanent global Security shall be surrendered by the Common Depository or such
other depository or Common Depository as shall be specified in the Company
Order with respect thereto to the Trustee, as the Company's agent for such
purpose, to be exchanged, in whole or from time to time in part, for definitive
Securities of such series without charge and the Trustee shall authenticate and
deliver, in exchange for each portion of such permanent global Security, a like
aggregate principal amount of definitive Securities of the same series of
authorized denominations and of like tenor as the portion of such permanent
global Security to be exchanged. If a Registered Security is issued in ex-
change for any portion of a permanent global Security after the close of
business at the office or agency where such exchange occurs on (i) any Regular
Record Date and before the opening of business at such office or agency on the
relevant Interest Payment Date, or (ii) any Special Record Date and before the
opening of business at such office or agency on the related proposed date for
payment of interest or Defaulted Interest, as the case may be, interest or
Defaulted Interest will not be payable on such Interest Payment Date or
proposed date for payment, as the case may be, in respect of such Registered
Security, but will be payable on such Interest Payment Date or proposed date for
payment, as the case may be, only to the Person to whom interest in respect of
such portion of such permanent global Security is payable in accordance with the
provisions of this Indenture.
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
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<PAGE>
the Securities surrendered upon such registration of transfer or exchange.
Every Registered Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Trustee or
any transfer agent) be duly endorsed, or be accompanied by a written instrument
of transfer in form satisfactory to the Company and the Security Registrar or
any transfer 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 Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.
The Company shall not be required (i) to issue, register the transfer of or
exchange Securities of any series during a period beginning at the opening of
business 15 days before any selection of Securities of that series to be
redeemed and ending at the close of business on the day of the mailing of the
relevant notice of redemption 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.
Notwithstanding the foregoing and except as otherwise specified or
contemplated by Section 301, any Book-Entry Security shall be exchangeable
pursuant to this Section 305 or Sections 304, 906 and 1107 for Securities
registered in the name of, and a transfer of a Book-Entry Security or any series
may be registered to, any Person other than the Depository for such Security or
its nominee only if (i) such Depository notifies the Company that it is
unwilling or unable to continue as Depository for such Book-Entry Security or if
at any time such Depository ceases to be a clearing agency registered under the
Securities Exchange Act of 1934, as amended, (ii) the Company executes and
delivers to the Trustee a Company Order that such Book-Entry Security shall be
so exchangeable and the transfer thereof so registerable or (iii) there shall
have occurred and be continuing an Event of
33
<PAGE>
Default, or an event which after notice or lapse of time would be an Event of
Default, with respect to the Securities of such series. Upon the occurrence
in respect of any Book-Entry Security of any series of any one or more of the
conditions specified in clauses (i), (ii) or (iii) or the preceding sentence or
such other conditions as may be specified as contemplated by Section 301 for
such series, such Book-Entry Security may be exchanged for Securities registered
in the names of, and the transfer of such Book-Entry Security may be registered
to, such Persons (including Persons other than the Depository with respect to
such series and its nominees) as such Depository shall direct. Notwithstanding
any other provision of this Indenture, any Security authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of, any Book-
Entry Security shall also be a Book-Entry Security and shall bear the legend
specified in Section 204 except for any Security authenticated and delivered in
exchange for, or upon registration of transfer of, Book-Entry Security pursuant
to the preceding sentence.
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 and such mutilated Security
shall be cancelled by the Trustee in accordance with the Indenture.
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, subject to the following paragraph, execute and
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.
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<PAGE>
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 payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and any such new
Security 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.
-----------------------------------------------
Unless otherwise provided as contemplated by Section 301 with respect to
any series of Securities, interest on any Registered 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 Registered Security of any series which is payable, but
is not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date by virtue of having been such Holder,
and such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) and (2) below:
35
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(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Registered Securities of such
series (or their respective Predecessor Securities) are registered at the
close of business on a Special Record Date for the payment of such
Defaulted Interest, which shall be fixed in the following manner. The
Company shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Registered 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 ar-
rangements 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 15 days
and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest and
the Special Record Date therefor to be mailed, first-class postage prepaid,
to each Holder of Registered Securities of such series at the address of
such Holder as it appears in the Security Register, not less than 10 days
prior to such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose names
the Registered Securities of such series (or their respective Predecessor
Securities) are registered at the close of business on such Special Record
Date and shall no longer be payable pursuant to the following Clause (2);
and
36
<PAGE>
(2) The Company may make payment of any Defaulted Interest on the
Registered 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 and Section 305, 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 Registered Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Registered Security is registered as
the owner of such Registered Security for the purpose of receiving payment of
principal of (and premium, if any) and (subject to Sections 305 and 307) any
interest on such Security and for all other purposes whatsoever, whether or not
such Security shall 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.
------------
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.
All Registered Securities so delivered shall be promptly cancelled by the
Trustee. 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
37
<PAGE>
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, or in the absence of a Company Order, may be destroyed by the Trustee.
Notwithstanding the foregoing, with respect to any Book-Entry Security,
nothing herein shall prevent the Company, the Trustee or any agent of the
Company or the Trustee, from giving effect to any written certification, proxy
or other authorization furnished by a Depository or impair, as between a
Depository and holders of beneficial interests in any Book-Entry Security, the
operation of customary practices governing the exercise of the rights of the
Depository (or its nominee) as Holder of such Book-Entry Security.
SECTION 310. Computation of Interest.
-----------------------
Except as otherwise specified as contemplated by Section 301 for Securities
of any series, (i) interest on the Securities of each series that bear interest
at a fixed rate will be calculated on the basis of a 360-day year of twelve 30-
day months and will not on the 31st day of any month and (ii) interest on the
Securities of each series that bear interest at a floating rate will be
calculated on the basis of the actual number of days elapsed and a year of 360
days, except that interest on Securities of a series that bear interest at a
floating rate which is based upon the yield of U.S. Treasury obligations will be
calculated on the basis of the actual number of days in the year.
SECTION 311. Electronic Security Issuance.
----------------------------
The Securities may pursuant to a Board Vote and Officers' Certificate
complying with Section 301 hereof be issued by means of an electronic issuance
system. Any such Security issuance instructions may specify the name, address
and taxpayer identification number of the Holder, the principal amount and
Maturity of the Security, the interest rate to be borne by the Security and any
other terms not inconsistent with such Board Vote and Officers'
38
<PAGE>
Certificate. Nothing in this Section 311 shall be construed as prohibiting the
Company from issuing Securities by any means not inconsistent with the
provisions of this Indenture.
ARTICLE IV
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 any right to receive additional
amounts, as provided in Section 1004), and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and dis-
charge of this Indenture, when:
(1) either
(A) all Securities theretofore authenticated and delivered (other
than (1) 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 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
39
<PAGE>
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 any 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 612 and, if money shall
have been deposited with the Trustee pursuant to clause (1)(B) 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.
--------------------------
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 any interest for whose payment such money has been deposited with the
Trustee.
40
<PAGE>
SECTION 403. Satisfaction, Discharge and Defeasance of Securities of any
-----------------------------------------------------------
Series.
- ------
If this Section 403 is specified, as contemplated by Section 301, to be
applicable to Securities of any series, then notwithstanding Section 401: (i)
the Company shall be deemed to have paid and discharged the entire indebtedness
on all the Outstanding Securities of any such series; (ii) the provisions of
this Indenture as it relates to such Outstanding Securities shall no longer be
in effect (except as to the rights of Holders of Securities to receive, from
the trust fund described in subparagraph (1) below, payment of (x) the
principal of (and premium, if any) and any installment of principal of (and
premium, if any) or interest on such Securities on the Stated Maturity of such
principal (and premium, if any) or installment of principal (and premium, if
any) or interest or (y) any mandatory sinking fund payments or analogous
payments applicable to the Securities of that series on that day on which such
payments are due and payable in accordance with the terms of the Indenture and
of such Securities, the Company's obligations with respect to such Securities
under Sections 304, 305, 306, 1002, 1003, and 1004 and the rights, powers,
trusts, duties and immunities of the Trustee hereunder, including those under
Sections 402 and 607 hereof); and (iii) the Trustee, at the expense of the
Company, shall, upon Company Request, execute proper instruments acknowledging
satisfaction and discharge of such indebtedness, when:
(1) either
(A) with respect to all Outstanding Securities of such series, with
reference to this Section 403, the Company has deposited or caused to be
deposited with the Trustee irrevocably (but subject to the provisions of
Section 402 and the last paragraph of Section 1003), as trust funds in
trust, specifically pledged as security for, and dedicated solely to, the
benefit of the Holders of the Securities of that series, (X) lawful money
of the United States in an amount, or (Y) U.S. Government Obligations which
through the payment of interest and principal in respect thereof in accor-
dance with their terms will provide not later than the opening of business
on the due dates
41
<PAGE>
of any payment referred to in Clause (i) or (ii) of this subparagraph
(1)(A) lawful money of the United States in an amount, or (z) 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 (i) the principal of
(and premium, if any) and each installment of principal (and premium, if
any) and interest on the Outstanding Securities of that series on the
Stated Maturity of such principal or installment of principal or interest
and (ii) any mandatory sinking fund payments or analogous payments
applicable to 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; or
(B) the Company has properly fulfilled such other means of
satisfaction and discharge as is specified, as contemplated by Section 301,
to be applicable to the Securities of such series;
(2) the Company has paid or caused to be paid all other sums
payable with respect to the Outstanding Securities of such Series;
(3) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound;
(4) no Event of Default or event which with the giving of notice or
lapse of time, or both, would become an Event of Default with respect to
the Securities of that series shall have occurred and be continuing on the
date of such deposit and no Event of Default under Section 501(6) or
Section 501(7) or event which with the giving of notice or lapse of time,
or both, would become an Event of Default under Section 501(6) or Section
501(7) shall have occurred and be continuing on the 91st day after such
date;
42
<PAGE>
(5) the Company has delivered to the Trustee an Opinion of Counsel
to the effect that (a) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (b) since the date
of this Indenture there has been a change in applicable federal income tax
law, in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders of Securities of such series will
not recognize income, gain or loss for federal income tax purposes as a
result of such deposit, defeasance and discharge and will be subject to
federal income tax on the same amount and in the same manner and at the
same times as would have been the case if such deposit, defeasance and
discharge had not occurred;
(6) if the Securities of that series are then listed on any
domestic or foreign securities exchange, the Company shall have delivered
to the Trustee an Opinion of Counsel to the effect that such deposit,
defeasance and discharge will not cause such Securities to be delisted; and
(7) 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
the entire indebtedness on all Outstanding Securities of any such series
have been complied with and an Opinion of Counsel to the effect that either
(i) as a result of such deposit and the related exercise of the Company's
option under this Section 403, registration is not required under the
Investment Company Act of 1940, as amended, by the Company, the trust funds
representing such deposit or the Trustee or (ii) all necessary
registrations under said Act have been effected.
Any deposits with the Trustee referred to in Section 403(1)(A) above shall
be irrevocable and shall be made under the terms of an escrow/trust agreement in
form and substance satisfactory to the Trustee. If any Outstand-
43
<PAGE>
ing Securities of such series are to be redeemed prior to their Stated Maturity,
whether pursuant to any optional redemption provisions or in accordance with any
mandatory sinking fund requirement, the applicable escrow trust agreement shall
provide therefor and the Company shall make such arrangements as are
satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the Company.
Upon the satisfaction of the conditions set forth in this Section 403 with
respect to all the Outstanding Securities of any series, the terms and
conditions of such series, including the terms and conditions with respect
thereto set forth in this Indenture, shall no longer be binding upon, or
applicable to, the Company; provided that the Company shall not be discharged
--------
from any payment obligations in respect of Securities of such series which are
deemed to be Outstanding under clause (iii) of the definition thereof because
such obligations continue to be valid obligations of the Company under
applicable law.
Notwithstanding the cessation, termination and discharge of all
obligations, covenants and agreements (except as provided above in this Section
403) of the Company under this Indenture with respect to any series of
Securities, the obligations of the Company to the Trustee under Section 607, and
the obligations of the Trustee under Section 402 and the last paragraph of
Section 1003 shall survive with respect to such series of Securities.
ARTICLE V
REMEDIES
SECTION 501. Events of Default.
-----------------
"Event of Default", wherever used herein with respect to Securities of any
series, means 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):
44
<PAGE>
(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) any event which shall have resulted in any indebtedness of the
Company in an amount greater than $10,000,000 being declared due and
payable prior to the date on which it would otherwise have become due and
payable; or
(5) 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 25% in principal amount of the Outstanding Securities of that
series, a written notice specifying such default or breach and requiring
it to be remedied and stating that such notice is a "Notice of Default"
hereunder; or
(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, ar-
45
<PAGE>
rangement, adjustment or composition of or in respect of the Company 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 60 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 continu-
46
<PAGE>
ing, then in every such case the Trustee or the Holders of not less than 25% in
principal amount of the Outstanding Securities of that series may declare the
principal amount (or, if any of the Securities of that series are Original Issue
Discount Securities, such portion of the principal amount of such Securities as
may be specified in the terms thereof) of all of the Securities of that series
to be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders), and upon any such declaration such principal
amount (or specified amount) shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before adjudgment 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 any 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
47
<PAGE>
(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,
(1) default is made in the payment of any interest on any Security
of any series 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 of any series at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities of that series, the whole amount then due and payable
on such Securities of that series for principal and any premium and interest
and, to the extent that payment of such interest shall be legally enforceable,
interest on any overdue principal and on the premium, if any, and overdue
interest, at the rate or rates prescribed therefor in such Securities of that
series 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
48
<PAGE>
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 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,
(i) to file and prove a claim for the whole amount of principal and
any premium 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 of Securities 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,
49
<PAGE>
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities 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 of Securities 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 605.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a Security
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 of a Security in any such pro-
ceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of Securities.
------------------------------------------------------------
All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities in respect of which such judgment has been
recovered.
SECTION 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 any premium
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:
50
<PAGE>
FIRST: To the payment of all amounts due the Trustee under Section 605;
and
SECOND: To the payment of the amounts then due and unpaid for principal of
and any premium 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 any premium 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;
(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;
51
<PAGE>
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 any premium 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 of a Security 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 of
Securities shall be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of the Trustee and
the Holders shall continue as though no such proceeding had been instituted.
SECTION 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 of Securities is intended to be exclusive or any other right or
remedy, and every
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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 Security to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of 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 of Securities may be exercised from time to time,
and as often as may be deemed expedient, by the Trustee or by the Holders of
Securities.
SECTION 512. Control by Holders of Securities.
--------------------------------
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.
Upon receipt by the Trustee of any written notice directing the time,
method or place of conducting any such proceeding or exercising any such trust
or power, with respect to Securities of a series all or part of which is
represented by a Global Security, a record date shall be established for
determining Holders of Outstanding Securities of such series entitled to join
in such notice, which record date shall be at the close of business on the day
the Trustee receives such notice. The
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Holders on such record date, or their duly designated proxies, and only such
Persons, shall be entitled to join in such notice, whether or not such Holders
remain Holders after such record date; provided, that unless the Holders of a
--------
majority in principal amount of the Outstanding Securities of such series shall
have joined in such notice prior to the day which is 90 days after such record
date, such notice shall automatically and without further action by any Holder
be canceled and of no further effect.
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 the Securities of
such series and its consequences, except
(1) a default in the payment of the principal of (or premium, if
any) or a continuing default in the payment of any interest on any
Security of such series, or
(2) a default 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.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Persons entitled to waive any past default hereunder.
If a record date is fixed, the Holders on such record date, or their duly
designated proxies, and only such Persons, shall be entitled to waive any
default hereunder, whether or not such Holders remain Holders after such record
date; provided, that unless such majority in principal amount shall have waived
--------
such default prior to the date which is 90 days after such record date, any such
waiver previously given shall automatically and without further action by any
Holder be canceled and of no further effect.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall
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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 25% in
principal amount of the Outstanding Securities of any series, or to any suit
instituted by any Holder of any Security for the enforcement of the payment of
the principal of or any premium 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 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.
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ARTICLE VI
THE TRUSTEE
SECTION 601. Certain Rights of Trustee.
-------------------------
Subject to the provisions of the Trust Indenture Act:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, coupon, 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 or as otherwise
expressly provided herein and any vote of the Board of Directors may be
sufficiently evidenced by a Board Vote;
(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 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 of Securities of any series 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;
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(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, coupon, 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 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 602. Not Responsible for Recitals or Issuance of Securities.
------------------------------------------------------
The recitals contained herein and in the Securities (except the Trustees
certificates of authentication) shall be taken as the statements of the Company,
and the Trustee or any Authenticating Agent assumes no responsibility for their
correctness. The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Securities. The Trustee or any
Authenticating Agent shall not be accountable for the use or application by the
Company of Securities or the proceeds thereof.
SECTION 603. May Hold Securities.
-------------------
The Trustee, any Authenticating Agent, 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 610, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.
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SECTION 604. 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 605. Compensation and Reimbursement.
------------------------------
The Company agrees:
(1) to pay to the Trustee or any predecessor 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 or any predecessor Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the 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 and any predecessor 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.
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SECTION 606. Resignation and Removal; Appointment of Successor.
-------------------------------------------------
(a) 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 607 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.
(b) 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.
(c) If at any time:
(1) the Trustee shall fail to comply with Section 310(b) of the
Trust Indenture Act after written request therefor by the Company or by any
Holder of a Security who has been a bona fide Holder of a Security for at
least six months, or
(2) the Trustee shall cease to be eligible under Section 310(a) of
the Trust Indenture Act and shall fail to resign after written request
therefor by the Company or by any 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 Vote may remove the Trustee
with respect to all Securities, or (ii) subject to Section 514 any Holder of a
Security who has been a bona fide Holder of a Security for at least
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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.
(d) 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 Vote,
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 series and that at any time there shall be only one Trustee with respect to
the Securities of any particular series) and shall comply with the applicable
requirements of Section 607. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of 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 607, become the suc-
cessor Trustee with respect to the Securities of such series and to that extent
supersede the successor Trustee appointed by the Company. If no successor
Trustee with respect to the Securities of any series shall have been so
appointed by the Company or the Holders of Securities of that series and
accepted appointment in the manner required by Section 607, any Holder of a
Security 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.
(e) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
in the manner provided in Section 106. Each notice shall include the name of the
successor Trustee with
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respect to the Securities of such series and the address of its Corporate Trust
Office.
SECTION 607. Acceptance of Appointment by Successor.
--------------------------------------
(a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities every such successor Trustee 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 (l)
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 supple-
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mental indenture shall constitute such Trustees as co-trustees of the same trust
and that each such Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder administered by any other
such Trustee; and upon the execution and delivery of such supplemental indenture
the resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Securities of that or
those series to which the appointment of such successor Trustee relates; but,
on request of the Company or any successor Trustee, such retiring Trustee shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder with respect to the Securities of
that or those series to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under this Article and the Trust Indenture Act.
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.
SECTION 609. Corporate Trustee Required; Eligibility.
---------------------------------------
There shall at all times be a Trustee hereunder which 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. If such
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Person 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 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 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 610. 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 611. 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 612. Appointment of Authenticating Agent.
-----------------------------------
The Trustee may appoint an Authenticating Agent or Agents with respect to
one or more series of Securities which shall be authorized to act on behalf of
the Trustee to authenticate Securities of such series issued upon
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<PAGE>
original issue or 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 an 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 Authenti-
cating 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 such 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 such Authenticating Agent.
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
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agency of an Authenticating Agent by giving written notice thereof 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 promptly give notice of
such appointment to all Holders of Securities pursuant to Section 106. 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 an 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 605.
If an appointment with respect to one or more series is made pursuant to
this Section, the Securities of such series may have endorsed thereon, in
addition to 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
---------------------
Authenticating Agent
By
---------------------
Authorized Signatory
If all of the Securities of a series may not be originally issued at one
time, and if the Company has an
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Affiliate eligible to be appointed as an Authenticating Agent hereunder or the
Trustee does not have an office capable of authenticating Securities upon
original issuance located in a Place of Payment where the Company wishes to
have Securities of such series authenticated upon original issuance, the
Trustee, if so requested by the Company in writing (which writing need not
comply with Section 102 and need not be accompanied by an Opinion of Counsel),
shall appoint in accordance with this Section an Authenticating Agent (which if
so requested by the Company, shall be such Affiliate of the Company) having an
office in a Place of Payment designated by the Company with respect to such
series of Securities.
ARTICLE VII
HOLDERS' LISTS 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
(1) semi-annually, not later than October 1 and April 1 in each
year, a list for each series of Securities, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders of Securities
of such series as of the preceding September 15 or March 15, as the case
may be, and
(2) 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 address-
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es of Holders of Securities (i) contained in the most recent list furnished to
the Trustee as provided in Section 701 and (ii) received by the Trustee in its
capacity as Security Registrar. The Trustee may (i) destroy any list furnished
to it as provided in Section 701 upon receipt of a new list so furnished, (ii)
destroy any information received by it as Paying Agent (if so acting) hereunder
upon delivering to itself as Trustee, not earlier than March 30 or September 30
of each year, a list containing the names and addresses of the Holders of
Securities obtained from such information since the delivery of the next
previous list, if any, and (iii) destroy any list delivered to itself as Trustee
which was compiled from information received by it as Paying Agent (if so
acting) hereunder upon the receipt of a new list so delivered.
(b) If three or more Holders of Securities (herein referred to as
"applicants") apply in writing to the Trustee, and furnish to the Trustee
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 of Securi-
ties with respect to their rights under this Indenture 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 Trustee shall, within five
business days after the receipt of such application, at its election, either
(i) afford such applicants access to the information preserved at
the time by the Trustee in accordance with Section 702(a), or
(ii) inform such applicants as to the approximate number of Holders
of Securities whose names and addresses appear in the information
preserved at the time by the Trustee in accordance with Section 702(a), and
as to the approximate cost of mailing to such Holders the form of proxy or
other communication, if any, specified in such application.
If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon the written request of such applicants,
mail to each
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Holder of Securities whose name and address appears in the information preserved
at the time by the Trustee in accordance with Section 702(a) a copy of the form
of proxy or other communication which is specified in such request, with
reasonable promptness after a tender to the Trustee of the material to be mailed
and of payment, or provision for the payment of the reasonable expenses of
mailing, unless within five days after such tender the Trustee shall mail to
such applicants and file with the Commission, together with a copy of the
material to be mailed, a written statement to the effect that, in the opinion of
the Trustee, such mailing would be contrary to the best interest of the Holders
of Securities or would be in violation of applicable law. Such written state-
ment shall specify the basis of such opinion. If the Commission, after
opportunity for a hearing upon the objections specified in the written statement
so filed, shall enter an order refusing to sustain any of such objections or if
after the entry of an order sustaining one or more of such objections, the
Commission shall find, after notice and opportunity for hearing that all the
objections so sustained have been met and shall enter an order so declaring, the
Trustee shall mail copies of such material to all such Holders of Securities
with reasonable promptness after the entry of such order and the renewal of such
tender; otherwise the Trustee shall be relieved of any obligation or duty to
such applicants respecting their application.
(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 by reason of the
disclosure of any such information as to the names and addresses of the Holders
of Securities in accordance with Section 702(b), regardless of the source from
which such information was derived and that the Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made under
Section 702(b).
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.
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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.
ARTICLE VIII
CONSOLIDATION, MERGER,
SALE, LEASE, TRANSFER
OR OTHER DISPOSITION
SECTION 801. Company May Consolidate, Etc. Only on Certain Terms.
---------------------------------------------------
The Company shall not consolidate or merge with or into any other Person or
sell, lease, transfer or otherwise dispose of its assets substantially as an
entirety to any Person, and the Company shall not permit any Person to
consolidate or merge with or into the Company or to sell, lease, transfer or
otherwise dispose of its assets substantially as an entirety to the Company,
unless:
(1) in case the Company shall consolidate or merge with or into
another Person or sell, lease, transfer or otherwise dispose of its assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which
acquires by sale, lease, transfer or otherwise, the 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 any premium and interest
(including all additional amounts, if any, payable pursuant to Section
1004) on all the Securities and the performance
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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
sale, lease, transfer or other disposition of the 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 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) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolida-
tion, merger, conveyance, sale, lease, transfer or other disposition 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.
SECTION 802. Successor Substituted.
---------------------
Upon any consolidation or merger of the Company with or into any other
Person or any sale, lease, transfer or other disposition of the 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 sale, lease, transfer or other disposition is made shall
assume the obligations of the Company on the Securities and under
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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 IX
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
--------------------------------------------------
Without the consent of any Holders of Securities, the Company, if then
authorized by a Board Vote, 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; or
(4) to change or eliminate any of the provisions of this Indenture,
provided that any such change or elimination shall become effective only
--------
when there is no Security Outstanding of any series created prior to the
execution of such supplemental indenture which is entitled to the benefit
of such provision; or
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(5) to secure the Securities pursuant to the requirements of
Section 1007 or otherwise; or
(6) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(7) to comply with Section 802 or Section 607; or
(8) to effect or maintain the qualification of this Indenture
under the Trust Indenture Act; or
(9) to evidence and provide for the acceptance of appointment
thereunder 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 607; or
(10) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising
under this Indenture, provided that such action 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 Vote, 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 modify-
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ing 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
installment of principal of or interest on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or any premium
payable upon the redemption thereof, or change any obligation of the
Company to pay additional amounts pursuant to Section 1004 (except as
contemplated by Section 801(1) and permitted by Section 901(1)), 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 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) change any obligation of the Company to maintain an office or
agency in the places and for the purposes specified in Section 1002, or
(4) 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
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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 of a Security 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 607 and 901(9).
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 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.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Persons entitled to consent to any indenture
supplemental hereto. If a record date is fixed, the Holders on such record
date, or their duly designated proxies, and only such Persons, shall be entitled
to consent to such supplemental indenture, whether or not such Holders remain
Holders after such record date; provided, that unless such consent shall have
--------
become effective by virtue of the requisite percentage having been obtained
prior to the date which is 90 days after such record date, any such consent
previously given shall automatically and without further action by any Holder be
canceled and of no further effect.
It shall not be necessary for any Act of Holders of Securities 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
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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 of 1939, as amended, in
effect on such date.
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 authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.
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ARTICLE X
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 any
premium 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 such series 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. The
Company will give prompt notice to the Trustee and to the Holders as provided in
Sections 105 and 106, respectively, of the location and any change in the
location, of any such office or agency. If at any time the Company shall fail to
maintain any such required office or agency in respect of any series of
Securities or shall fail to furnish the Trustee with the address thereof, such
presentations and surrenders of Securities of that series may be made and
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
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 accordance with the requirements set forth above for Securities of any series
for such purposes. The Company will give prompt written notice to the Trustee
and the Holders 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 Payments 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 any premium 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 any premium 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 any premium
or interest on any Securities of that series, deposit with a Paying Agent a sum
sufficient to pay the principal and any premium or interest so becoming due,
such sum to be held 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) hold all sums held by it for the payment of the principal of
and any premium or interest on Securities of that series in trust for the
benefit of the Persons entitled thereto until such sums shall be paid to
such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities of that series) in the making of any
payment of principal of and any premium or interest on the Securities of
that series; and
(3) at any time during the continuance of any such default, upon
the written request
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of the Trustee, forthwith pay to the Trustee all sums so held in trust by
such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of and any premium or
interest on any Security of any series and remaining unclaimed for two years
after such principal and any premium 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.
SECTION 1004. Additional Amounts.
------------------
If the Securities of a series provide for the payment of additional
amounts, the Company will pay to the Holder of any Security of such series
additional amounts as provided therein. Whenever in this Indenture there is
mentioned, in any context, the payment of the principal of or any premium or
interest on, or in respect of any Security of any series or the net proceeds
received on the sale or exchange of any Security of any series, such mention
shall be deemed to include mention of the payment of additional amounts provided
for in this Section to the extent that, in such context additional amounts are,
were or would be payable in respect thereof pursuant to the provisions of this
Section and express mention of the payment of additional amounts (if applicable)
in any provisions hereof shall not be construed as excluding additional amounts
in those provisions hereof where such express mention is not made.
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<PAGE>
SECTION 1005. 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 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 1006. [Intentionally Omitted]
SECTION 1007. Limitation on Liens.
-------------------
(a) The Company will not, nor will it permit any Subsidiary to, issue,
assume or guarantee any indebtedness for money borrowed, including but not
limited to any Funded Debt (hereinafter in this Article Ten referred to as
"Debt"), if such Debt is secured by a mortgage, pledge, security interest or
lien (any mortgage, pledge, security interest or lien being hereinafter in this
Article Ten referred to as a "mortgage" or "mortgages") upon any assets, stock
or other indebtedness of the Company now owned or hereafter acquired, without in
any such case effectively providing, concurrently with the issuance, assumption
or guarantee of such Debt, that the Securities (together with, if the Company
shall so determine, any other indebtedness of or guaranteed by the Company or
such Subsidiary ranking equally with the Securities then outstanding and
existing or thereafter created) shall be secured equally and ratably with (or
prior to) such Debt; provided, however, that, subject to subsection (c) of this
-------- -------
Section 1007, the foregoing restriction shall not apply to:
(1) mortgages on any property acquired, constructed or improved by
the Company or any Subsidiary after the date of this Indenture which are
created or assumed contemporaneously with, or within one hundred and eighty
days after, such acquisition (or in the case of property constructed or
improved, after the completion and commencement of commercial operation of
such property, whichever is later) to
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secure or provide for the payment of any part of the purchase price of such
property or the cost of such construction or improvement, or mortgages on
any property existing at the time of acquisition thereof; provided that in
--------
the case of any such construction or improvement the mortgage shall not
apply to any property theretofore owned by the Company or any Subsidiary,
other than any theretofore unimproved real property on which the property
so constructed, or the improvement, is located;
(2) mortgages on any property acquired from a corporation which is
merged with or into the Company or a Subsidiary or mortgages outstanding
at the time any corporation becomes a Subsidiary;
(3) mortgages in favor of the Company or any Subsidiary; and
(4) any extension, renewal or replacement (or successive
extensions, renewals or replacements) in whole or in part, of any mortgage
referred to in the foregoing clauses (l) to (3), inclusive; provided,
--------
however, that the principal amount of Debt secured thereby shall not exceed
-------
the principal amount of Debt 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 which secured the
mortgage so extended, renewed or replaced (plus improvements on such
property).
(b) Notwithstanding the provisions of subsection (a) of this Section
1007, but subject to subsection (c) of this Section 1007, the Company or any
Subsidiary may issue, assume or guarantee secured Debt, which would otherwise
be subject to the foregoing restrictions, in an aggregate amount which together
with all other such Debt and all Attributable Debt in respect of Sale and Lease-
Back Transactions (as defined in Section 1008) of the Company and its
Subsidiaries existing at such time (other than Sale and Lease-Back Transactions
the proceeds of which have been applied in accordance with clause (b) of Section
1008), does not at the time exceed 10% of the
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stockholders' equity of the Company and its consolidated Subsidiaries, computed
in accordance with generally accepted accounting principles applied on a
consistent basis, as shown on the audited consolidated balance sheet contained
in the latest annual report to stockholders of the Company.
(c) Notwithstanding the provisions of subsections (a) and (b) of this
Section 1007, the Company's Subsidiaries shall not issue, assume or otherwise
incur Funded Debt in excess of $5 million in the aggregate at any time
outstanding.
SECTION 1008. Limitation on Sale and Lease-Back Transactions.
-----------------------------------------------
The Company will not, nor will it permit any Subsidiary to, enter into any
arrangement with any person providing for the leasing to the Company or a
Subsidiary of any real property (except for temporary leases for a term of not
more than three years), which property has been owned and, in the case of any
such Facility, has been placed in commercial operation more than one hundred and
eighty days by the Company or such Subsidiary and has been or is to be sold or
transferred by the Company or such Subsidiary to such person (herein referred to
as "Sale and Lease-Back Transactions"), unless either (a) the Company or such
Subsidiary would be entitled to incur Debt secured by a mortgage on the property
to be leased in an amount equal to the Attributable Debt with respect to such
Sale and Lease-Back Transactions without equally and ratably securing the
Securities pursuant to Section 1007 or (b) the Company shall, and in any such
case the Company covenants that it will, apply an amount equal to the fair value
(as determined by the Board of Directors) of the property so leased to the
retirement, within one hundred and eighty days of the effective date of any such
Sale and Lease-Back Transactions, of Securities or of Funded Debt of the Company
which ranks on a parity with the Securities.
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
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signers thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions of this Indenture, 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 1007 to 1008, inclusive, with
respect to the Securities of any series if before the time for such compliance
the Holders of at least a majority 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.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Persons entitled to waive any such term provision or
condition. If a record date is fixed, the Holders on such record date, or their
duly designated proxies, and only such Persons, shall be entitled to waive any
such term, provision or condition hereunder, whether or not such Holders remain
Holders after such record date; provided, that unless the Holders of at least a
--------
majority in principal amount of the Outstanding Securities of such series shall
have waived such term, provision or condition prior to the date which is 90 days
after such record date, any such waiver previously given shall automatically and
without further action by any Holder be canceled and of no further effect.
SECTION 1011. Defeasance of Certain Obligations.
---------------------------------
If this Section 1011 is specified, as contemplated by Section 301, to be
applicable to Securities of any series, the Company may omit to comply with any
term, provision or condition set forth in Section 1007 or Section 1008 and any
such omission with respect to Sec-
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tion 1007 or Section 1008 shall not be an Event of Default, in each case with
respect to the Securities of that series, provided that the following conditions
have been satisfied:
(1) with reference to this Section 1011, the Company has deposited
or caused to be deposited with the Trustee (or another trustee satisfying
the requirements of Section 609) irrevocably (but subject to the provisions
of Section 402 and the last paragraph of Section 1003) as trust funds in
trust, specifically pledged as security for and dedicated solely to the
benefit of the Holders of the Securities of that series, (A) lawful money
of the United States in an amount, or (B) U.S. Government Obligations which
through the payment of interest and principal in respect thereof in
accordance with their terms will provide not later than the opening of
business on the due dates of any payment referred to in clause (i) or
(ii) of this subparagraph (l) lawful money of the United States 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 (i) the principal of (and premium, if any) and each installment
of principal (and premium, if any) and interest on the Outstanding
Securities of that series on the Stated Maturity of such principal or
installment of principal or interest and (ii) any mandatory sinking fund
payments or analogous payments applicable to 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;
(2) such deposit shall not cause the Trustee with respect to the
Securities of that series to have a conflicting interest as defined in
Section 608 and for purposes of the Trust Indenture Act with respect to the
Securities of any Series;
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(3) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound;
(4) no Event of Default or event which with the giving of notice or
lapse of time, or both, would become an Event of Default with respect to
the Securities of that series shall have occurred and be continuing on the
date of such deposit and no Event of Default under Section 501(6) or
Section 501(7) or event which with the giving of notice or lapse of time,
or both, would become an Event of Default under Section 501(6) or Section
501(7) shall have occurred and be continuing on the 91st day after such
date;
(5) the Company has delivered to the Trustee an Opinion of Counsel
to the effect that Holders of the Securities of such series will not
recognize income gain or loss for federal income tax purposes as a result
of such deposit and defeasance of certain obligations 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 and defeasance had
not occurred;
(6) if the Securities of that series are then listed on any foreign
or domestic securities exchange, the Company has delivered to the Trustee
an Opinion of Counsel to the effect that such deposit and defeasance will
not cause such Securities to be delisted; and
(7) 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 defeasance contemplated in
this Section have been complied with and an Opinion of Counsel to the
effect that either (i) as a result of such deposit and the related exercise
of the Company's option under this Section 1011 registration is not
required under the Investment
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Company Act of 1940, as amended, by the Company, the trust funds
representing such deposit or the Trustee or (ii) all necessary registra-
tions under said Act have been effected.
ARTICLE XI
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
an Officer's Certificate. In the case of any redemption, at the election of the
Company, of less than all the Securities of any series, the Company shall, not
less than 30 nor more than 60 days prior to the Redemption Date fixed by the
Company (unless the Trustee shall otherwise agree), notify the Trustee of such
Redemption Date and of the principal amount of Securities of such series to be
redeemed. In the case of any redemption of Securities (i) prior to the
expiration of any restriction on such redemption provided in the terms of such
Securities or elsewhere in this Indenture or (ii) pursuant to an election of the
Company which is subject to a condition specified in the terms of such
Securities, the Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with such restriction or condition.
SECTION 1103. Selection by Trustee of Securities to Be Redeemed.
-------------------------------------------------
If less than all the Securities of any series are to be redeemed, 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,
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for redemption of portions (equal to the minimum authorized denomination for
Securities of that series or any integral multiple thereof) of the principal
amount of Registered Securities of such series of a denomination larger than the
minimum authorized denomination for Securities of that series. If so specified
in the Securities of a series, partial redemptions must be in an amount not
less than $ 1,000,000 principal amount of Securities.
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption and, in the case of any Securities selected for partial
redemption, the principal amount thereof to be redeemed.
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 in the manner provided in Section 106
to the Holders of Securities to be redeemed not less than 30 nor more than 60
days prior to the Redemption Date (unless the Trustee shall otherwise agree).
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 are
to be redeemed, the identification (and, in the case of partial redemption,
the principal amounts) of the particular Securities to be redeemed, and a
statement to the effect that on or after the Redemption Date upon
surrender of such Security a new Security in the principal amount equal to
the unredeemed portion will be issued;
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(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; and
(5) 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 [and shall be irrevoca-
ble].
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, installments of interest on Registered Securities
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.
87
<PAGE>
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal and any premium shall, until paid, bear
interest from the Redemption Date at the rate prescribed therefor in the
Security.
SECTION 1107. Securities Redeemed in Part.
---------------------------
Any Registered 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 Registered 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. If a
global security is so surrendered, such new Security so issued shall be a new
Global Security.
ARTICLE XII
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 to the extent or 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
88
<PAGE>
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
case in satisfaction of all or any part of any sinking fund payment with respect
to the Securities of such series required to be made pursuant to the terms of
such Securities, as provided for by the terms of such series; provided that such
--------
Securities have not been previously so credited. Such Securities shall be
received and credited for such purpose by the Trustee at the Redemption Price
specified in such Securities for redemption through operation of the sinking
fund and the amount of such sinking fund payment shall be reduced accordingly.
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 to the Trustee any Securities to
be so delivered. Not less than 45 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.
89
<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.
HOUGHTON MIFFLIN COMPANY
By /s/ Stephen O. Jaeger
-------------------------------
Executive Vice President and
Chief Financial Officer
[Seal]
Attest:
/s/ Lois M. Novotny
- -----------------------
Assistant Clerk
THE FIRST NATIONAL BANK OF
BOSTON
By /s/ Donna L. Germano
--------------------------------
Donna L. Germano
Account Manager
[Seal]
Attest:
/s/ Eric J. Donaghey
- -----------------------
Eric J. Donaghey
Assistant Cashier
90
<PAGE>
COMMONWEALTH OF MASSACHUSETTS )
) ss.:
COUNTY OF SUFFOLK )
On the 5th day of April, 1994, before me personally came Stephen O.
Jaeger, to me known, who, being by me duly sworn, did depose and say that he is
Executive Vice President of Houghton Mifflin Company, 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.
/s/ Kathleen A. Rideout
--------------------------------
[Seal] Notary Public,
Commonwealth of Massachusetts
Qualified in Suffolk County
--------------------------------
Commission Expires July 27, 1995
91
<PAGE>
COMMONWEALTH OF MASSACHUSETTS )
) ss.:
COUNTY OF SUFFOLK )
On the 4th day of April, 1994, before me personally came Donna L.
Germano, to me known, who, being by me duly sworn, did depose and say that he
is Account Manager of The First National Bank of Boston, a national banking
association described in and which executed the foregoing instrument; that he
knows the seal of said association; that the seal affixed to said instrument
is such association seal; that it was so affixed by authority of the Board of
Directors of said association, and that he signed his name thereto by like
authority.
/s/ Bernadette May
--------------------------------
[Seal] Notary Public,
Commonwealth of Massachusetts
Qualified in Norfolk County
--------------------------------
Commission Expires October 31, 1997
92
<PAGE>
EXHIBIT A
[Form of Registered Security Which Is Not An
Original Issue Discount Security]
[Form of Face]
HOUGHTON MIFFLIN COMPANY
No. [R-] $
Houghton Mifflin Company, a corporation duly organized and existing
under the laws of the Commonwealth of Massachusetts (herein called the
"Company", which term includes any successor Person under the Indenture re-
ferred to on the reverse hereof), for value received, hereby promises to pay to
___________ or registered assigns, the principal sum of __________ Dollars on
_________, and to pay interest thereon from _______, 19__ or from the most
recent Interest Payment Date to which interest has been paid or duly provided
for, [semi-annually in arrears on __________ and __________ in each year]
[annually in arrears on __________ in each year], commencing ________, 19__, at
the rate of ____% per annum, until the principal hereof is paid or made avail-
able for payment [If applicable, insert--and (to the extent that the payment of
such interest shall be legally enforceable) at the rate of ____% per annum on
any over-due principal [and premium] and on any overdue installment of
interest]. 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. Except
as otherwise provided in the Indenture, 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 (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
A-1
<PAGE>
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. Payment of the
principal of [(and premium, if any)] and interest on this Security will be made
at the office or agency of the Company maintained for that purpose designated
pursuant to Section 1002 of the Indenture, 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 at the Corporate Trust Office of the Trustee or such
other office or agency of the Company as may be designated by it for such
purpose pursuant to Section 1002 of the Indenture, in such coin or currency of
the United States of America as at the time of payment shall be legal tender for
the payment of public and private debts [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] [or by wire transfer to an account maintained
by such Person with a bank in The City of New York (so long as the Company has
received proper transfer instructions in writing)].
[If Securities of the series are to be offered to United States
Aliens, insert--The Company will pay to the Holder of this Security who is a
United States Alien (as defined below) such additional amounts as may be
necessary in order that every net payment of the principal of [(and premium, if
any)] and interest on this Security, after deduction or withholding for or on
account of any present or future tax, assessment or other governmental charge
imposed by the United States (as defined below) or any political subdivision or
taxing authority thereof or therein upon or as a result of such payment, will
not be less than the amount provided for in this Security to be then due and
payable; provided, however, that the foregoing obligation to pay additional
-------- -------
amounts will not apply to any one or more of the following:
(a) any tax, assessment or other governmental charge which would
not have been so imposed but for (i) the existence of any present or former
connection between such Holder (or between a fiduciary, settlor,
beneficiary or member of such Holder, if such Holder is
A-2
<PAGE>
an estate, a trust or a partnership) and the United States, including,
without limitation, such Holder (or such fiduciary, settlor, beneficiary
or member) being or having been a citizen or resident or treated as a
resident thereof, or being or having been engaged in trade or business or
present therein, or having or having had a permanent establishment
therein, or -(ii) such Holders' present or former status as a personal
holding company, a foreign personal holding company, a controlled foreign
corporation for United States tax purposes or a corporation which
accumulates earnings to avoid United States federal income tax;
(b) any tax, assessment or other governmental charge imposed on
interest received by a Person holding, actually or constructively, 10% or
more of the total combined voting power of all classes of stock of the
Company entitled to vote;
(c) any tax, assessment or other governmental charge which would
not have been imposed but for the failure to comply with any certification,
identification or other reporting requirements concerning the nationality,
residence, identity or connection with the United States of the Holder or
beneficial owner of this Security, if compliance is required by the statute
or by regulation of the United States Treasury Department as a precondition
to exemption from such tax, assessment or other governmental charge;
(d) any estate, inheritance, gift, sales, transfer, personal
property or any similar tax, assessment or other governmental charge;
(e) any tax, assessment or other governmental charge which is
payable otherwise than by deduction or withholding from payments of
principal of [(and premium, if any)] or interest on this Security; or
(f) any tax, assessment or other governmental charge which would
not have been
A-3
<PAGE>
so imposed but for the presentation by the Holder of this Security for
payment on a date more than 15 days after the date on which such payment
became due and payable or the date on which payment thereof is duly
provided for, whichever occurs later;
nor will additional amounts be paid with respect to any payment of principal of
[(and premium, if any)] or interest on this Security to any United States Alien
who is a fiduciary or partnership or other than the sole beneficial owner of
any such payment to the extent that a beneficiary or settlor with respect to
such fiduciary, a member of such a partnership or the beneficial owner would not
have been entitled to the additional amounts had such beneficiary, settlor,
member or beneficial owner been the Holder of this Security. The term "United
States Alien" means any Person who, for United States federal income tax
purposes, is a foreign corporation, a non-resident alien individual, a non-
resident alien fiduciary of a foreign estate or trust or a foreign partnership
one or more of the members of which is, for United States federal income tax
purposes, a foreign corporation, a non-resident alien individual or a non-
resident alien fiduciary of a foreign estate or trust, and the term "United
States" means the United States of America (including the States and the
District of Columbia), its territories, its possessions and other areas subject
to its jurisdiction.]
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, directly or through an
Authenticating Agent, by manual signature of an authorized signatory, this
Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
-----------------
-----------------------
[Seal] By
--------------------
A-4
<PAGE>
Attest:
- ------------------------
[Form of Reverse]
This Security is one of a duly authorized 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 September __, 1992 (herein called
the "Indenture"), between the Company and The First National Bank of Boston, as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee 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 [, limited in aggregate
principal amount to $_____]. As provided in the Indenture and subject to
certain limitations therein set forth, Registered Securities of this series are
exchangeable for a like aggregate principal amount of Registered Securities of
this series and of like tenor of any authorized denominations, as requested by
the Holder surrendering the same, upon surrender of the Registered Security
or Registered Securities to be exchanged at any office or agency described below
where Registered Securities of this series may be presented for registration of
transfer.
[If applicable, insert--The Securities of this series are subject to
redemption [(1)] [If applicable, insert--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)] [If applicable, insert--at any time [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 [on or
before _______________, ____%, and if redeemed] during the 12-month period
beginning _________________ of the years indicated,
A-5
<PAGE>
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
- ---- ----- ---- -----
<S> <C> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to __% of the principal amount,] [If
applicable, insert--[and (____)] under the circumstances described in the next
[two] succeeding paragraph[s] at a Redemption Price equal to 100% 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; provided, however, that installments
-------- --------
of interest on this Security whose Stated Maturity is on or prior to such
Redemption Date will be payable to the Holder of this Security, 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 (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 [on or after _________, 19__], 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,
<TABLE>
<CAPTION>
Redemption Price
for Redemption Redemption Price for
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
- ---- ------------ -------------------
<S> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to __% of the principal amount. [If
applicable, insert--and (3) under the circumstances described in the next [two]
succeeding paragraph[s] at a Redemption Price equal to 100% 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
A-6
<PAGE>
Date; provided, however, that installments of interest on this Security whose
-------- -------
Stated Maturity is on or prior to such Redemption Date will be payable to the
Holder of this Security, 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.] [Notwithstanding the foregoing, the Company
may not, prior to ______________ redeem any Securities of this series as
contemplated by Clause [(2)] above 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 Securities of the series are to be offered to United States
Aliens, insert--The Securities of this series may be redeemed, as a whole but
not in part, at the option of the Company, at a Redemption Price equal to 100%
of their principal amount, together with interest accrued to the date fixed for
redemption, if, as a result of any amendment to, or change in, the laws or
regulations of the United States or any political subdivision or taxing
authority thereof or therein affecting taxation, or any amendment to or change
in an official interpretation or application of such laws or regulations, which
amendment or change is effective on or after ____________, 19__, the Company
will become obligated to pay additional amounts (as described on the face
hereof) on the next succeeding Interest Payment Date and such obligation cannot
be avoided by the use of reasonable measures available to the Company; provided,
--------
however, that (a) no such notice of redemption may be given earlier than 90
- -------
days prior to the earliest date on which the Company would be obligated to pay
such additional amounts were a payment in respect of the Securities of this
series then due, and (b) at the time notice of such redemption is given, such
obligation to pay such additional amounts remains in effect. Immediately prior
to the publication of any notice of redemption pursuant to this paragraph, the
Company shall deliver to the Trustee a certificate stating that the Company is
entitled to effect such redemption and setting forth a statement of facts
showing that the conditions precedent to the right of the Company so to redeem
have occurred.]
[The sinking fund for this series provides for the redemption on
______ in each year, beginning with the year ____ and ending with the year ____,
of [not less than] $_____ [("mandatory sinking fund") and not more
A-7
<PAGE>
than $_______] aggregate principal amount of Securities of this series.
[Securities of this series acquired or redeemed by the Company otherwise than
through [mandatory] sinking fund payments may be credited against subsequent
[mandatory] sinking fund payments otherwise required to be made -- in the
inverse order in which they become due.]]
Notice of redemption will be given by mail to Holders of Registered
Securities, not less than 30 nor more than 60 days prior to the date fixed for
redemption, all as provided in the Indenture.
In the event of redemption of this Security in part only, a new
Registered Security or Securities of this series and of like tenor for the
unredeemed portion hereof will be issued in the name of the Holder hereof upon
the cancellation hereof.
[The Indenture contains provisions of defeasance of (a) the entire
indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.]
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 due and payable in the manner and with the effect provided in
the Indenture.
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 time by the Company and the Trustee with the
consent of the Holders of a majority 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 hereof or in lieu hereof, whether or not nota-
A-8
<PAGE>
tion of such consent or waiver is made upon this Security.
As set forth in, and subject to, the provisions of the Indenture, no
Holder of any Security of this 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 with respect to this series, the Holders of not less
than 25% in principal amount of the Outstanding Securities of this series shall
have made written request, and offered reasonable indemnity, to the Trustee to
institute such proceeding as trustee, and the Trustee shall have received from
the Holders of a majority in principal amount of the Outstanding Securities of
this series a direction inconsistent with such request and shall have failed to
institute such proceeding within 60 days; provided, however, that such
-------- -------
limitations do not apply to a suit instituted by the Holder hereof for the
enforcement of payment of the principal of [(and premium, if any)] or interest
on this Security 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 premium, if any)]
and interest [(including additional amounts, as described on the face hereof)]
on this Security at the times, place[s] and rate, 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
premium, if any)] 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 Registered
Securities of this series and of like tenor, of authorized denominations and for
the same aggregate principal amount, will be issued to the designated trans-
feree or transferees.
The Securities of this series are issuable only in registered form,
without coupons, in denominations of
A-9
<PAGE>
$1,000 and any integral multiple thereof. As provided in the Indenture and
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 for all purposes, whether or not this Security is overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Indenture and the Securities shall be governed by and construed in
accordance with the laws of the State of New York.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
A-10
<PAGE>
FORM OF ASSIGNMENT
(I) or (we) assign and transfer this Security to
- --------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
- --------------------------------------------------------------------------------
agent to transfer this Security on the books of the
- --------------------------
Company. The agent may substitute another to act for him.
- --------------------------------------------------------------------------------
Date: Your Signature:
----------------
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee.
A-11
<PAGE>
EXHIBIT B
[FORM OF REGISTERED SECURITY WHICH IS AN
ORIGINAL ISSUE DISCOUNT SECURITY]
[Form of Face]
FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE INTERNAL REVENUE CODE,
THE AMOUNT OF ORIGINAL ISSUE DISCOUNT ON THIS SECURITY IS $_____ PER $1,000 OF
ITS PRINCIPAL AMOUNT, THE ISSUE DATE IS ___________, 19__ [,--AND] THE YIELD TO
MATURITY IS ____% [, THE METHOD USED TO DETERMINE THE YIELD IS ___________ AND
THE AMOUNT OF ORIGINAL ISSUE DISCOUNT APPLICABLE TO THE SHORT ACCRUAL PERIOD OF
___________, 19__ TO _______, 19__ IS $_____ PER $1,000 OF THE PRINCIPAL AMOUNT
OF THIS SECURITY].
HOUGHTON MIFFLIN COMPANY
No. [R-] $
Houghton Mifflin Company, a corporation duly organized and existing
under the laws of the Commonwealth of Massachusetts (herein called the
"Company", which term includes any successor Person under the Indenture re-
ferred to on the reverse hereof), for value received, hereby promises to pay to
_____________________, or registered assigns, the principal sum of
______________________________ Dollars on _____________________ [If the
Security is interest-bearing, insert--, and to pay interest thereon from
___________, 19__ or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, [semi-annually in arrears on
________________ and in each year] [annually in arrears on _____________________
in each year], commencing _______, 19__, at the rate of ____% per annum, until
the principal hereof is paid or made available for payment [If applicable,
insert--, and (to the extent that the payment of such interest shall be legally
enforceable) at the rate of ____% per annum on any overdue amounts. 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.
B-1
<PAGE>
Except as otherwise provided in the Indenture, 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 (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--This Security shall not bear interest except
in the case of a default in payment of amounts due upon acceleration, upon
redemption or at Stated Maturity, and in such case such amounts shall bear
interest at the rate of ____% per annum (to the extent that the payment of such
interest shall be legally enforceable), which shall accrue from the date of such
default in payment to the date payment of such amounts has been made or duly
provided for. Interest on any overdue amount shall be payable on demand. Any
such interest on any overdue amount that is not so paid on demand shall bear
interest at the rate of ____% per annum (to the extent that the payment of such
interest shall be legally enforceable), which shall accrue from the date of such
demand for payment to the date payment of such interest has been made or duly
provided for, and such interest shall also be payable on demand.] Payment of
amounts due with respect to this Security will be made at the office or agency
of the Company maintained for that purpose designated pursuant to Section 1002
of the Indenture, 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 at
the Corporate Trust Office of the Trustee or such other office or agency of the
Company as may be designated pursuant to Section 1002 of the Indenture, in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts or (b) subject to
any laws or regulations applicable thereto and to the right of the Company
(limited as provided in the Indenture) to rescind the designation of any such
Paying Agent, at the [main] offices of ___________ in ___________, _______ in
_______ _______ in _______, _______ in _______ and _______ in _______, or at
such
B-2
<PAGE>
other offices or agencies as the Company may designate, by [United States
dollar] check drawn on, or transfer to a United States dollar account maintained
by the payee with, a bank in The City of New York] [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] [or by wire transfer to an
account maintained by such Person with a bank in The City of New York (so long
as the Company has received proper transfer instructions in writing)].
[If Securities of the series are to be offered to United States
Aliens, insert--The Company will pay to the Holder of this Security who is a
United States Alien (as defined below) such additional amounts as may be
necessary in order that [If the Security is interest-bearing, insert--every net
payment of the principal of [(and premium, if any)] and interest on this
Security] [If the Security is not to bear interest prior to Maturity, insert--
(i) the net payment of amounts due with respect to this Security (including
interest on overdue amounts, if any) and (ii) the net proceeds from the sale or
exchange of this Security, including, in each case, amounts accreted in respect
of original issue discount], after deduction or withholding for or on account of
any present or future tax, assessment or other governmental charge imposed by
the United States (as defined below) or any political subdivision or taxing
authority thereof or therein upon or as a result of such payment [If the
Security is not to bear interest prior to Maturity, insert--or, as a result of
such sale or exchange] will not be less than the amount provided for in this
Security to be then due and payable [If the Security is not to bear interest
prior to Maturity; insert--or, in the case of a sale or exchange, the amount of
the net proceeds from the sale or exchange before any such tax, assessment or
other governmental charge]; provided, however, that the foregoing obligation to
-------- -------
pay additional amounts will not apply to any one or more of the following:
(a) any tax, assessment or other governmental charge which would
not have been so imposed but for (i) the existence of any present or former
connection between such Holder (or between a fiduciary, settlor,
beneficiary or member of such Holder, if such Holder is an estate, a trust
or a partnership) and the United States, including, without limitation,
B-3
<PAGE>
such Holder (or such fiduciary, settlor, beneficiary or member) being or
having been a citizen or resident or treated as a resident thereof, or
being or having been engaged in trade or business or present therein, or
having or having had a permanent establishment therein, or -(ii) such
Holder's present or former status as a personal holding company, a foreign
personal holding company, a controlled foreign corporation for United
States tax purposes or a corporation which accumulates earnings to avoid
United States federal income tax;
(b) any tax, assessment or other governmental charge imposed [If
the Security is interest-bearing, insert--on interest received by a Person
holding, actually or constructively, 10% or more of the total combined
voting power of all classes of stock of the Company entitled to vote] [If
the Security is not to bear interest prior to Maturity, insert--by reason
of such Holder's past or present status as the actual or constructive owner
of 10% or more of the total combined voting power of all classes of stock
of the Company entitled to vote];
(c) any tax, assessment or other governmental charge which would
not have been imposed but for the failure to comply with any certification,
identification or other reporting requirements concerning the nationality,
residence, identity or connection with the United States of the Holder or
beneficial owner of this Security, if compliance is required by the statute
or by regulation of the United States Treasury Department as a precondition
to exemption from such tax, assessment or other governmental charge;
(d) any estate, inheritance, gift, sales, transfer, personal
property or any similar tax, assessment or other governmental charge;
(e) any tax, assessment or other governmental charge which is
payable otherwise than by deduction or withholding from payments of [If the
Security is interest-bearing, insert--principal of [(and premium, if any)]
or
B-4
<PAGE>
interest on this Security] [If the Security is not to bear interest prior
to maturity, insert--principal of (or interest on overdue principal, if
any, on) this Security or from payments from the proceeds of a sale or
exchange of this Security]; or
(f) any tax, assessment or other governmental charge which would
not have been so imposed but for the presentation by the Holder of this
Security for payment on a date more than 15 days after the date on which
such payment became due and payable or the date on which payment thereof is
duly provided for, whichever occurs later;
nor will additional amounts be paid with respect to any payment of amounts due
with respect to this Security to any United States Alien who is a fiduciary or
partnership or other than the sole beneficial owner of any such payment to the
extent that a beneficiary or settlor with respect to such fiduciary, a member of
such a partnership or the beneficial owner would not have been entitled to the
additional amounts had such beneficiary, settlor, member or beneficial owner
been the Holder of this Security. The term "United States Alien" means any
Person who, for United States federal income tax purposes, is a foreign
corporation, a non-resident alien individual, a non-resident alien fiduciary of
a foreign estate or trust or a foreign partnership one or more of the members of
which is, for United States federal income tax purposes, a foreign corporation,
a non-resident alien individual or a non-resident alien fiduciary of a foreign
estate or trust, and the term "United States" means the United States of America
(including the States and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction.]
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, directly or through an
Authenticating Agent, by manual signature of an authorized signatory, this
Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
B-5
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
-----------------
-----------------------
[Seal] By
--------------------
Attest:
- ------------------------
[Form of Reverse]
This Security is one of a duly authorized 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 September __, 1992 (herein called
the "Indenture"), between the Company and The First National Bank of Boston, as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee 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 [, limited in aggregate
principal amount to $______]. As provided in the Indenture and subject to
certain limitations therein set forth, Registered Securities of this series are
exchangeable for a like aggregate principal amount of Registered Securities of
this series and of like tenor of any authorized denominations, as requested by
the Holder surrendering the same, upon surrender of the Security or Securities
to be exchanged at any office or agency described below where Registered
Securities of this series may be presented for registration of transfer.
[If applicable, insert--The Securities of this series are subject to
redemption [(1)] [If applicable, insert--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 [Insert formula for
determining the amount], [and]
B-6
<PAGE>
(2)] [If applicable, insert--at any time [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 accreted value [or principal amount, as
the case may be]): If redeemed [on or before ____________________, ____%, and
if redeemed] during the 12-month period beginning ____________________ of the
years indicated,
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
- ---- ----- ---- -----
<S> <C> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to ____% of the accreted value [or
principal amount, as the case may be], [If applicable, insert--[and (____)]
under the circumstances described in the next [two] succeeding paragraph[s] at a
Redemption Price equal to [Insert formula for determining the amount]] [If the
Security is interest-bearing, insert--, 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; provided,
--------
however, that installments of interest on this Security whose Stated Maturity is
- -------
on or prior to such Redemption Date will be payable to the Holder of this
Security, or one or more Predecessor Securities, of record at the close of busi-
ness 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 (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 accreted value [or principal amount, as the
case may be]) set forth in the table below, and (2) at any time [on or after
___________________, 19__], 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 accreted value
[or principal amount, as the case may be]) set forth in the table below: If
redeemed during the 12-month period beginning ____________________ of the years
indicated,
B-7
<PAGE>
<TABLE>
<CAPTION>
Redemption Price
for Redemption Redemption Price for
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
- ---- ------------ -------------------
<S> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to ____% of the accreted value [or
principal amount, as the case may be]. [If applicable, insert--and (3) under
the circumstances described in the next [two] succeeding paragraph[s] at a
Redemption Price equal to [Insert formula for determining the amount]] [If the
Security is interest-bearing, insert--, together in the case of any such
redemption (whether through operation of the sinking fund or otherwise) with
accrued interest to the Redemption Date; provided, however, that installments of
-------- -------
interest on this Security whose Stated Maturity is on or prior to such
Redemption Date will be payable to the Holder of this Security, 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].]
[Notwithstanding the foregoing, the Company may not, prior to
____________________, redeem any Securities of this series as contemplated by
Clause [(2) above 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 Securities of the series are to be offered to United States
Aliens, insert--The Securities of this series may be redeemed, as a whole but
not in part, at the option of the Company, determined as set forth in the
preceding paragraph [If the Security interest-bearing, insert--, together with
interest accrued to the date fixed for redemption,] if, as a result of any
amendment to, or change in, the laws or regulations of the United States or any
political subdivision or taxing authority thereof or therein affecting taxation,
or any amendment to or change in an official interpretation or application of
such laws or regulations, which amendment or change is effective on or after
___________, 19__, the Company will become obligated to pay additional amounts
(as described on the face hereof) [If the Security is interest-bearing, insert--
on the next succeeding Interest Payment Date] [If the Security is not to bear
interest prior to Maturity, insert--at Maturity or upon the sale or exchange of
any
B-8
<PAGE>
Security] and such obligation cannot be avoided by the use of reasonable
measures available to the Company; provided, however, that (a) no such notice of
-------- -------
redemption may be given earlier than 90 days prior to the earliest date on which
the Company would be obligated to pay such additional amounts were a payment in
respect of the Securities of this series then due [If the Security is not to
bear interest prior to Maturity, insert--or were a sale or exchange of a
Security of this series then made], and (b) at the time notice of such
redemption is given, such obligation to pay such additional amounts remains in
effect. Immediately prior to the publication of any notice of redemption
pursuant to this paragraph, the Company shall deliver to the Trustee a
certificate stating that the Company is entitled to effect such redemption and
setting forth a statement of facts showing that the conditions precedent to the
right of the Company so to redeem have occurred.]
[The sinking fund for this series provides for the redemption on
_______________ in each year, beginning with the year ____ and ending with the
year ____ of [not less than] $______[("mandatory sinking fund") and not more
than $______] aggregate accreted value [or principal amount, as the case may be]
of Securities of this series. [Securities of this series acquired or redeemed
by the Company otherwise than through [mandatory] sinking fund payments may be
credited against subsequent [mandatory] sinking fund payments otherwise required
to be made--in the inverse order in which they become due.]]
Notice of redemption will be given by mail to Holders of Registered
Securities, not less than 30 nor more than 60 days prior to the date fixed for
redemption, all as provided in the Indenture.
In the event of redemption of this Security in part only, a new
Registered Security or Securities of this series and of like tenor for the
unredeemed portion hereof will be issued in the name of the Holder hereof upon
the cancellation hereof.
[The Indenture contains provisions of defeasance of (a) the entire
indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.]
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
B-9
<PAGE>
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 and overdue 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 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 time by the Company and the Trustee with the
consent of the Holders of a majority 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 set forth in, and subject to, the provisions of the Indenture, no
Holder of any Security of this 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 with respect to this series, the Holders of not less
than 25% in principal amount of the Outstanding Securities of this series shall
have made written request, and offered reasonable indemnity, to the Trustee to
institute such proceeding as trustee, and the Trustee shall not have received
from the Holders of a majority in principal amount of the Outstanding Securities
of this series a direction inconsistent with such request and shall have failed
to institute such proceeding within 60 days; provided, however, that such
-------- -------
limitations do not
B-10
<PAGE>
apply to a suit instituted by the Holder hereof for the enforcement of payment
of amounts due with respect to this Security 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 amounts due with respect to this Security
[(including any additional amounts, as described on the face hereof)] at the
times, place[s] 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 amounts due with respect to
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 Registered 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 and 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 for all purposes, whether or not this Secu-
B-11
<PAGE>
rity is overdue, and neither the Company, the Trustee nor any such agent shall
be affected by notice to the contrary.
The Indenture and the Securities and any coupons appertaining thereto
shall be governed by and construed in accordance with the laws of the State of
New York.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
B-12
<PAGE>
FORM OF ASSIGNMENT
(I) or (we) assign and transfer this Security to
- --------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
- --------------------------------------------------------------------------------
agent to transfer this Security on the books of the
- ---------------------------
Company. The agent may substitute another to act for him.
- --------------------------------------------------------------------------------
Date: Your Signature:
--------------- -------------------
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee.
B-13
<PAGE>
EXHIBIT C
[Forms of Certification]
EXHIBIT C.1
[Form of Certificate to Be Given by Euro-Clear
and Cedel S.A. in Connection with the Exchange of a
Portion of a Temporary Global Security]
CERTIFICATE
---------------------
[Insert title or sufficient description
of Securities to be delivered]
This is to certify with respect to $ principal amount of the
above-captioned Securities (i) that we have received from each of the persons
appearing in our records as persons entitled to a portion of such principal
amount (our "Qualified Account Holders") a certificate with respect to such
portion substantially in the form attached hereto, and (ii) that we are not
submitting herewith for exchange any portion of the temporary global Security
representing the above-captioned Securities excepted in such certificates.
We further certify that as of the date hereof we have not received any
notification from any of our Qualified Account Holders to the effect that the
state-ments made by such Qualified Account Holders with respect to any portion
of the part submitted herewith for exchange are no longer true and cannot be
relied upon as of the date hereof.
Dated: , 19
[To be dated no earlier than
the Exchange Date]
[MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, Brussels Office, as
Operator of the Euro-clear System]
[Cedel S.A.]
By
-------------------------
C.1-1
<PAGE>
EXHIBIT C.2
[Form of Certificate to Be Given by Euro-Clear and Cedel
S.A. to Obtain Interest Prior to an Exchange Date]
CERTIFICATE
-----------------------
[Insert title or sufficient description of Securities]
We confirm that the interest payable on the Interest Payment Date on
[Insert Date] will be paid to each of the persons appearing in our records as
being entitled to interest payable on such date from whom we have received a
written certification, dated not earlier than such Interest Payment Date,
substantially in the form attached hereto. We undertake to retain certificates
received from our member organizations in connection herewith for four years
from the end of the calendar year in which such certificates are received.
We undertake that any interest received by us and not paid as provided
above shall be returned to the Trustee for the above Securities immediately
prior to the expiration of two years after such Interest Payment Date in order
to be repaid by such Trustee to the above issuer at the end of two years after
such Interest Payment Date.
Dated: , 19
[To be dated on or after the
relevant Interest Payment Date]
[MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, Brussels Office, as
Operator of the Euro-clear System]
[Cedel S.A.]
By
--------------------------
C.2-1
<PAGE>
EXHIBIT C.3
[Form of Certificate to Be Given by Beneficial Owners to
Obtain Interest Prior to an Exchange Date]
CERTIFICATE
-------------------------
[Insert title or sufficient description of Securities]
This is to certify that as of the Interest Payment Date on [Insert
date] and except as provided in the third paragraph hereof, none of the above-
captioned Securities held by you for our account was beneficially owned by a
United States person or, if any of such Securities held by you for our account
were beneficially owned by a United States person, such United States person
either provided an Internal Revenue Service Form W-9 with respect to such
interest payment or certified with respect to such interest payment that it was
an exempt recipient as defined in Section 1.6049-4(c)(1)(ii) of the United
States Treasury regulations.
As used herein, "United States person" means any citizen or resident
of the United States, any corporation, partnership or other entity created or
organized in or under the laws of the United States and any estate or trust the
income of which is subject to United States Federal income taxation regardless
of its source, and "United States" means the United States of America (including
the States and the District of Columbia), its territories, its possessions and
other areas subject to its jurisdiction.
This certificate excepts and does not relate to U.S. $ principal
amount of the above-captioned Securities appearing in your books as being held
for our account as to which we are not yet able to certify and as to which we
understand interest cannot be credited unless and until we are able so to
certify.
C.3-1
<PAGE>
We understand that this certificate may be required in connection
with certain tax legislation in the United States. If administrative or legal
proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.
Dated: , 19
[To be dated on or after the relevant
Interest Payment Date]
[Name of Person Entitled to
Receive Interest]
---------------------------
(Authorized Signatory)
Name:
Title:
C.3-2
