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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
September 24, 1998
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Date of Report (Date of Earliest Event Reported)
INTERNATIONAL PAPER COMPANY
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(Exact name of Registrant as specified in its charter)
NEW YORK 1-3157 13-0872805
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(State of (Commission (I.R.S Employer
Incorporation) File) Identification Number)
Two Manhattanville Road, Purchase, NY 10577
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(Address of Principal executive offices)
914-397-1500
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(Telephone No.)
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ITEM 5. OTHER EVENTS.
On September 1, 1998, International Paper Company (the "Company"),
International Paper Capital Trust III ("Trust III") and International Paper
Capital Trust IV ("Trust IV") filed a registration statement (File No.
333-62661) on Form S-3 with the Securities and Exchange Commission (the
"Commission") relating to the public offering, pursuant to Rule 415 under the
Securities Act of 1933, as amended (the "Act"), of up to an aggregate of
$1,100,000,000 of securities of the Company, Trust III and Trust IV (the
"Registration Statement"). Pursuant to Rule 429 under the Act, the prospectus in
the Registration Statement also relates to $2,000,000,000 of securities
previously registered under the Company's registration statement on Form S-3
(File No. 33-52945) and $400,000,000 of securities previously registered under
the Company's registration statement on Form S-3 (File No. 33-48167). The amount
of securities eligible to be sold under the prior registration statements
carried forward to the Registration Statement is $975,575,000. On September 10,
1998, the Commission declared the Registration Statement effective (the
Registration Statement and the definitive prospectus contained therein are
collectively referred to as the "Prospectus").
The Company and Trust III filed on September 11, 1998 a preliminary
supplement to the Prospectus, relating to the issuance and sale of up to
$300,000,000 of capital securities of Trust III. The Company and Trust III filed
with the Commission on September 21, 1998, a final prospectus supplement to the
Prospectus, relating to the issuance and sale of $805,000,000 (after the
underwriters' over-allotment option was exercised in full) of 7 7/8% Capital
Securities of Trust III (the "Trust III Capital Securities Supplement"). In
connection with the filing with the Commission of the Trust III Capital
Securities Supplement, the Company and Trust III are filing certain exhibits as
part of this Form 8-K. See "Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits."
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
(c) Exhibits.
The following exhibits are filed with this report on Form 8-K:
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Exhibit Description
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1.4 Underwriting Agreement by and among the Company,
Trust III and the underwriters named therein, dated
September 17, 1998, with respect to the issuance and
sale of $805,000,000 (after the underwriters'
over-allotment option was exercised) of 7 7/8%
Capital Securities of Trust III.
4.5 Indenture for Subordinated Debt Securities (the
"Indenture"), dated as of September 15, 1998, between
the Company and The Bank of New York, as indenture
trustee.
4.11 Amended and Restated Declaration of Trust of Trust
III, dated as of September 24, 1998, by and among the
Company, The Bank of New York, as property trustee,
The Bank of New York (Delaware), as Delaware trustee,
and the regular trustees named therein..
4.12 Capital Securities Guarantee Agreement for Trust III,
dated as of September 24, 1998, between the Company
and The Bank of New York, as guarantee trustee.
4.15 First Supplemental Indenture to the Indenture, dated
as of September 24, 1998, between the Company and The
Bank of New York, as indenture trustee.
5.1 Opinion of James W. Guedry, Esq., Associate General
Counsel of the Company.
5.2 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP,
special counsel to Trust III.
8.1 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP,
special tax counsel to the Company and to Trust III.
</TABLE>
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<TABLE>
<CAPTION>
Exhibit Description
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23.1 Consent of James W. Guedry, Esq., Associate General
Counsel of the Company (included in Exhibit 5.1).
23.2 Consent of Skadden, Arps, Slate, Meagher & Flom LLP,
special counsel to Trust III (included in Exhibit
5.2).
23.3 Consent of Skadden, Arps, Slate, Meagher & Flom LLP,
special tax counsel to the Company and Trust III
(included in Exhibit 8.1).
</TABLE>
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
INTERNATIONAL PAPER COMPANY
(Registrant)
Dated: September 24, 1998 /s/ James W. Guedry
Purchase, NY ----------------------------
James W. Guedry
Secretary and Vice President
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Exhibit 1.4
UNDERWRITING AGREEMENT
(Capital Securities)
September 17, 1998
International Paper Company
Two Manhattanville Road
Purchase, New York 10577
International Paper Capital Trust III
c/o International Paper Company
Two Manhattanville Road
Purchase, New York 10577
Dear Sirs:
We, Morgan Stanley & Co. Incorporated (the "Manager"), are acting on
behalf of the underwriters (including ourselves) named below (such underwriter
or underwriters being herein called the "Underwriters"), and we understand that
International Paper Capital Trust III (the "Issuer Trust"), a statutory business
trust created under the Delaware Business Trust Act pursuant to the filing of a
Certificate of Trust (the "Certificate of Trust") with the Secretary of State of
the State of Delaware, proposes to issue and sell 28,000,000 International Paper
Capital Trust III 7 7/8% Capital Securities (the "Firm Capital Securities"). The
Issuer Trust also proposes to issue and sell to the several Underwriters not
more than an additional 4,200,000 Capital Securities (the "Additional Capital
Securities") if and to the extent that we, as Manager of the offering, shall
have determined to exercise, on behalf of the Underwriters, the right to
purchase such Additional Capital Securities granted to the Underwriters herein.
The Firm Capital Securities and the Additional Capital Securities are
hereinafter collectively referred to as the "Offered Capital Securities."
It is understood that substantially contemporaneously with the closing
of the sale of the Offered Capital Securities to the Underwriters contemplated
hereby, (i) the Issuer Trust, International Paper Company (the "Company"), The
Bank of New York, as property trustee (the "Property Trustee"), The Bank of New
York (Delaware), as Delaware trustee (the "Delaware Trustee" and, together with
the Property Trustee, the "Issuer Trustees") and three individuals who are
employees or officers of or who are affiliated with the Company (the "Regular
Trustees") shall enter into an Amended and Restated Declaration of Trust in
substantially the form of the Form of the Amended and Restated Declaration of
Trust attached as Exhibit 4.l1 to the Registration Statement referred to below
(the "Declaration"), pursuant to which the Issuer Trust shall (x) issue and sell
the Offered Capital Securities to the Underwriters pursuant hereto and (y) issue
865,980 shares of its common securities (the "Common Securities" and, together
with the Offered Capital Securities, the "Trust Securities") to the Company, in
each case with
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such rights and obligations as shall be set forth in such Declaration, (ii)
the Company and The Bank of New York, will act as trustee (the "Debt
Securities Trustee") for purposes of the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"), pursuant to a Subordinated Debt
Indenture, dated as of September 15, 1998, as supplemented by the First
Supplemental Indenture thereto between the Company and the Debt Securities
Trustee, dated as of September 24, 1998 (as so supplemented, the
"Subordinated Debt Indenture"), which shall provide for the issuance of
$721,649,500 ($829,896,925 in the event that the Underwriters exercise in
full their right to purchase Additional Capital Securities) principal amount
of the Company's 7 7/8% Junior Subordinated Deferrable Interest Debentures
due December 1, 2038, (the "Subordinated Debentures"), (iii) the Company
shall sell such Subordinated Debentures to the Issuer Trust and the Issuer
Trust shall purchase such Subordinated Debentures with proceeds from the sale
of the Offered Capital Securities to the Underwriters contemplated hereby and
of the Common Securities to the Company and (iv) for the benefit of holders
of the Offered Capital Securities from time to time the Company and The Bank
of New York, as guarantee trustee (the "Guarantee Trustee"), shall enter into
a Guarantee Agreement in substantially the form of the Form of the Guarantee
Agreement attached as Exhibit 4.13 to the Registration Statement referred to
below (the "Guarantee"), pursuant to which the Company shall, as set forth in
such Guarantee Agreement, guarantee the payment of distributions and amounts
payable on liquidation or redemption of the Offered Capital Securities.
Subject to the terms and conditions set forth or incorporated by
reference herein, the Issuer Trust hereby agrees to sell and the Underwriters
agree to purchase, severally and not jointly, the aggregate number of Firm
Capital Securities set forth opposite their names on Schedule I hereto at a
purchase price of $25 per Firm Capital Security, (the "Purchase Price");
provided, that the Company shall pay to the Underwriters compensation equal to
$0.7875 per Firm Capital Security.
Subject to the terms and conditions set forth herein, the Issuer Trust
hereby agrees to sell to the Underwriters the Additional Capital Securities and
the Underwriters shall have a one-time right to purchase, severally and not
jointly, up to 4,200,000 Additional Capital Securities at the Purchase Price
plus accrued dividends, if any, from and including September 24, 1998 to the
date of payment and delivery; provided, that the Company shall pay to the
Underwriters compensation equal to $0.7875 per Additional Capital Security.
Additional Capital Securities may be purchased as provided herein solely for the
purpose of covering over-allotments made in connection with the offering of the
Firm Capital Securities. If any Additional Capital Securities are to be
purchased, each Underwriter agrees, severally and not jointly, to purchase the
number of Additional Capital Securities (subject to such adjustments to
eliminate fractional Additional Capital Securities as you may determine) that
bears the same proportion to the total number of Additional Capital Securities
to be purchased as the number of Firm Capital Securities set forth in Schedule I
opposite the name of such Underwriter bears to the total number of Firm Capital
Securities.
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The Underwriters will pay for the Firm Capital Securities upon delivery
thereof at the offices of Skadden, Arps, Slate, Meagher & Flom LLP, 919 Third
Avenue, New York, New York at 10:00 a.m. (New York time) on September 24, 1998,
or at such other time, not later than 5:00 p.m. (New York time) on October 1,
1998, as shall be designated by us. The time and date of such payment and
delivery are hereinafter referred to as the "Closing Date."
Payment for any Additional Capital Securities shall be made to the
Issuer Trust in immediately available funds at the offices referred to above on
such date (which may be the same as the Closing Date but shall in no event be
earlier than the Closing Date nor later than ten business days after the giving
of the notice hereinafter referred to) as shall be designated in a written
notice from us to the Company of our determination, on behalf of the
Underwriters, to purchase a number, specified in said notice, of Additional
Capital Securities, or on such other date, in any event not later than October
24, 1998, as shall be designated in writing by us. The time and date of such
payment are hereinafter referred to as the "Option Closing Date." The notice of
the determination to exercise the option to purchase Additional Capital
Securities and of the Option Closing Date may be given at any time within 30
days after the date of this Agreement.
The several obligations of the Underwriters to purchase Additional
Capital Securities hereunder are subject to the delivery to us on the Option
Closing Date of such documents as we may reasonably request with respect to the
good standing of the Company and the Issuer Trust, the due authorization and
issuance of the Additional Capital Securities and other matters related to the
issuance of the Additional Capital Securities.
The Company and the Issuer Trust have filed with the Securities and
Exchange Commission (the "Commission") a registration statement including a
prospectus relating to the Offered Capital Securities and the Guarantee
(collectively, the "Securities") and have filed with the Commission, a
Prospectus Supplement, dated September 17, 1998 (the "Prospectus Supplement"),
pursuant to Rule 424 under the Securities Act of 1933, as amended (the
"Securities Act"), specifically relating to the Securities offered pursuant to
this Agreement. The term "Registration Statement" means the registration
statement (File No. 333-62661) filed on September 1, 1998, as amended to the
date of this Agreement. The term "Basic Prospectus" means the prospectus
included in the Registration Statement. The term "Prospectus" means the Basic
Prospectus together with the Prospectus Supplement. The term preliminary
prospectus means a preliminary prospectus supplement specifically relating to
the Offered Capital Securities, together with the Basic Prospectus. As used
herein, the terms "Basic Prospectus," "Prospectus" and "preliminary prospectus"
shall include in each case the documents, if any, incorporated by reference
therein. The terms "supplement," "amendment" and "amend" as used herein shall
include all documents deemed to be incorporated by reference in the Prospectus
that are filed subsequent to the date of the Basic Prospectus by the Company
with the Commission pursuant to the Securities Exchange Act of 1934,
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as amended (the "Exchange Act"). The Offered Capital Securities shall have the
terms set forth in the Prospectus, dated September 10, 1998, and the Prospectus
Supplement, dated September 17, 1998, including the following:
Terms of Offered Capital Securities
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Designation of the Series
of Capital Securities: 7 7/8% Capital Securities.
Issuer of Offered
Capital Securities: International Paper Capital Trust III.
Aggregate Number of
Capital Securities: 28,000,000 (32,200,000, if the
Underwriters' over-allotment option
is exercised in full).
Price to Public: $25.
Purchase Price: $25.
Underwriters' Compensation
per Capital Security: $0.7875.
Selling Concession: $0.50.
Reallowance: $0.45.
Closing Date: September 24, 1998.
Form: Book-Entry.
Other Terms:
Maturity Date: December 1, 2038, subject to
advancement under certain
circumstances to a date no earlier
than December 1, 2013.
Liquidation Amount: $25.
Distributions: 7 7/8% per annum.
Distribution Payment
Dates: March 1, June 1, September 1 and
December 1 of each year, commencing
December 1, 1998.
</TABLE>
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Redemption: Redeemable prior to maturity at the
option of the Company (i) on or
after September 24, 2003, in whole
at any time, or in part from time to
time, and (ii) prior to September
24, 2003, in whole (but not in part)
at any time within 90 days following
the occurrence and continuation of a
Tax Event or an Investment Company
Event, in each case, at par.
</TABLE>
Capitalized terms used above and not defined herein shall have the
meanings set forth in the Prospectus and Prospectus Supplement referred to
above.
1. Representations and Warranties. Each of the Company and the Issuer
Trust specified in the Underwriting Agreement jointly and severally represents
and warrants to each of the Underwriters as of the date of this Agreement:
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied or will
comply when so filed in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (ii) each part of
the Registration Statement, when such part became effective, did not contain and
each such part, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading,
(iii) the Registration Statement and the Prospectus comply, and, as amended or
supplemented, if applicable, will comply, in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder and (iv) the Prospectus does not contain and, as amended or
supplemented, if applicable, will not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
except that the representations and warranties set forth in this Section 1(b) do
not apply (A) to statements or omissions in the Registration Statement or the
Prospectus based upon information concerning any Underwriter furnished to the
Company in writing by such Underwriter through the Manager expressly for use
therein or (B) to those parts of the Registration Statement that constitute the
Statements of Eligibility (Form T-1) under the Trust Indenture Act of the
trustees referred to in the Registration Statement.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of New York, has the
corporate power and authority to own its property and to conduct its business as
described in the Prospectus and is duly qualified to transact business and is in
good standing in each
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jurisdiction in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material adverse effect
on the Company and its consolidated subsidiaries, taken as a whole.
(d) Each subsidiary of the Company has been duly incorporated or
formed, is validly existing in good standing under the laws of the jurisdiction
of its incorporation or formation, has the corporate or other power and
authority to own its property and to conduct its business as described in the
Prospectus and is duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a material
adverse effect on the Company and its consolidated subsidiaries, taken as a
whole.
(e) The Issuer Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Business Trust Act, is a
"grantor trust" for United States Federal income tax purposes, has the power and
authority to conduct its business as presently conducted and as described in the
Prospectus and is not required to be authorized to do business in any other
jurisdiction.
(f) This Agreement has been duly authorized, executed and delivered by
each of the Issuer Trust and the Company.
(g) The Subordinated Debt Indenture has been duly qualified under the
Trust Indenture Act and has been duly authorized, executed and delivered by the
Company and assumed by the Company; and the Subordinated Debt Indenture is a
valid and binding agreement of the Company, enforceable in accordance with its
terms except as the enforceability thereof (i) may be limited by bankruptcy,
insolvency, reorganization, liquidation, moratorium and other similar laws
affecting creditors' rights generally and (ii) is subject to general principles
of equity, regardless of whether such enforceability is considered in a
proceeding in equity or at law.
(h) The Subordinated Debentures have been duly authorized by the
Company and, when executed and authenticated in accordance with the provisions
of the Subordinated Debt Indenture, and delivered to and paid for as described
in the Prospectus, will be entitled to the benefits of the Subordinated Debt
Indenture, and will be valid and binding obligations of the Company, enforceable
in accordance with their terms except as the enforceability thereof (i) may be
limited by bankruptcy, insolvency, reorganization, liquidation, moratorium and
other similar laws affecting creditors' rights generally and (ii) is subject to
general principles of equity, regardless of whether such enforceability is
considered in a proceeding in equity or at law.
(i) The Guarantee has been qualified under the Trust Indenture Act and
has been duly authorized by the Company and, upon execution and delivery thereof
by the
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Company (and assuming due authorization, execution and delivery by the Guarantee
Trustee), will, as of the Closing Date, be a valid and binding agreement of the
Company, enforceable in accordance with its terms except as the enforceability
thereof (i) may be limited by bankruptcy, insolvency, reorganization,
liquidation, moratorium and other similar laws affecting creditors' rights
generally and (ii) is subject to general principles of equity, regardless of
whether such enforceability is considered in a proceeding in equity or at law.
(j) The Declaration has been qualified under the Trust Indenture Act
and has been duly authorized by the Company and the Issuer Trust and, upon
execution and delivery thereof by the Company and the Issuer Trust (and assuming
due authorization, execution and delivery thereof by each party thereto other
than the Company and the Issuer Trust), will, as of the Closing Date, be a valid
and binding agreement of the Company and the Issuer Trust, enforceable in
accordance with its terms except as the enforceability thereof (i) may be
limited by bankruptcy, insolvency, reorganization, liquidation, moratorium and
other similar laws affecting creditors' rights generally and (ii) is subject to
general principles of equity, regardless of whether such enforceability is
considered in a proceeding in equity or at law and except as rights to
indemnification may be limited under applicable law.
(k) The Offered Capital Securities have been duly authorized by the
Declaration and, when executed and authenticated in accordance with the
provisions of the Declaration and delivered to and paid for by the Underwriters
in accordance with the terms of this Agreement, will be validly issued and
(subject to the terms of the Declaration) fully paid and non-assessable
undivided beneficial interests in the assets of the Issuer Trust, and the
issuance of such Offered Capital Securities will not be subject to any
preemptive or similar rights. Holders of the Offered Capital Securities will be
entitled to the same limitation of personal liability as that extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. The Common Securities of the Issuer
Trust have been duly authorized by the Declaration and, when issued and
delivered to the Company against payment therefor as described in the
Prospectus, will be validly issued undivided beneficial interests in the assets
of the Issuer Trust, and the issuance of such Common Securities will not be
subject to any preemptive rights.
(l) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement, the Subordinated Debt
Indenture, the Declaration, the Guarantee and the Subordinated Debentures, will
not contravene any provision of applicable law, the Declaration or the
certificate of incorporation or by-laws of the Company or any agreement or other
instrument binding upon the Company or any of its subsidiaries that is material
to the Company and its consolidated subsidiaries, taken as a whole, or any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or any of its consolidated subsidiaries, and no
consent, approval, authorization or order of, or qualification with, any
governmental body
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or agency is required for the performance by the Company of its obligations
under this Agreement, the Subordinated Debt Indenture, the Declaration, the
Guarantee and the Subordinated Debentures, except such as may be required by the
securities or blue sky laws of the various states in connection with the offer
and sale of the Offered Capital Securities; provided, however, that no
representation is made as to whether the purchase of the Offered Capital
Securities constitutes a "prohibited transaction" under Section 406 of the
Employee Retirement Income Security Act of 1974, as amended, or Section 4975 of
the Internal Revenue Code of 1986, as amended.
(m) The execution and delivery by the Issuer Trust of, and the
performance by the Issuer Trust of its obligations under, this Agreement will
not contravene any provision of applicable law or the Declaration or any
agreement or other instrument binding upon the Issuer Trust, or any judgment,
order or decree of any governmental body, agency or court having jurisdiction
over the Issuer Trust, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the
performance by the Issuer Trust of its obligations under this Agreement, except
such as may be required by the securities or blue sky laws of the various states
in connection with the offer and sale of the Offered Capital Securities;
provided, however, that no representation is made as to whether the purchase of
the Offered Capital Securities constitutes a "prohibited transaction" under 406
of the Employment Retirement Income Security Act of 1974, as amended, or Section
4975 of the Internal Revenue Code of 1986, as amended.
(n) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of the Issuer
Trust or the Company and its subsidiaries, taken as a whole, from that set forth
in the Prospectus (exclusive of any amendments or supplements thereto effected
subsequent to the date of this Agreement).
(o) The Issuer Trust is not, and after giving effect to the offering
and sale of the Offered Capital Securities and the application of the proceeds
thereof as described in the Prospectus will not be, an "investment company" as
such term is defined under the Investment Company Act of 1940, as amended.
(p) There are no legal or governmental proceedings pending or
threatened to which the Issuer Trust or the Company or any of its consolidated
subsidiaries is a party or to which any of the properties of the Issuer Trust or
the Company or any of its consolidated subsidiaries is subject that are required
to be described in the Registration Statement or the Prospectus and are not so
described or any statutes, regulations, contracts or other documents that are
required to be described in the Registration Statement or the Prospectus or to
be filed or incorporated by reference as exhibits to the Registration Statement
that are not described, filed or incorporated as required.
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(q) Each of the Issuer Trust and the Company and its consolidated
subsidiaries has all necessary consents, authorizations, approvals, orders,
certificates and permits of and from, and has made all declarations and filings
with, all Federal, state, local and other governmental authorities, all
self-regulatory organizations and all courts and other tribunals, to own, lease,
license and use its properties and assets and to conduct its business in the
manner described in the Prospectus, except to the extent that the failure to
obtain or file would not have a material adverse effect on the Company and its
consolidated subsidiaries, taken as a whole.
2. Public Offering. The Issuer Trust and the Company are advised by the
Manager that the Underwriters propose to make a public offering of their
respective portions of the Offered Capital Securities, as soon after this
Agreement has been entered into as in the Manager's judgment is advisable. The
terms of the public offering of the Offered Capital Securities, are set forth in
the Prospectus.
3. Purchase and Delivery. Except as otherwise provided in this Section
3, payment for the Offered Capital Securities shall be made by wire transfer to
the Issuer Trust in immediately available funds at the time and place set forth
herein, upon delivery to the Manager for the respective accounts of the several
Underwriters of the Offered Capital Securities in definitive book-entry form,
registered in such names and in such denominations or amounts, as the case may
be, as the Manager shall request in writing not less than one full business day
prior to the date of delivery, with any transfer taxes payable in connection
with the transfer of the Offered Capital Securities to the Underwriters duly
paid.
4. Conditions to Closing. The several obligations of the Underwriters
hereunder are subject to the following conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date,
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the
Company's securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act;
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition, financial
or otherwise, or in the earnings, business or operations of the Company
and its consolidated subsidiaries, taken as a whole, or, the Issuer
Trust, from that set forth in the Prospectus (exclusive of any
amendments or supplements thereto effected subsequent to the execution
and delivery of this Agreement), that, in the judgment of the Manager,
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is material and adverse and that makes it, in the judgment of the
Manager, impracticable to market the Offered Capital Securities on the
terms and in the manner contemplated in the Prospectus; and
(iii) the Manager shall have received on the Closing Date a
certificate, dated the Closing Date and signed by the Chief Financial
Officer or the Treasurer of the Company, or any other person authorized
by the Board of Directors of the Company to execute any such written
statement (an "Executive Officer") to the effect set forth in clause
(i) above, and a certificate signed by an Executive Officer and one of
the Regular Trustees to the effect that the representations and
warranties of the Company and the Issuer Trust contained in this
Agreement are true and correct as of the Closing Date and that each of
the Company and the Issuer Trust, as applicable, has complied with all
of the agreements and satisfied all of the conditions on its part to be
performed or satisfied on or before the Closing Date.
The Executive Officer and the Regular Trustee signing and
delivering such certificates may rely upon the best of his or her
knowledge as to proceedings threatened.
(b) The Manager shall have received on the Closing Date an opinion of
James W. Guedry, Vice President, Associate General Counsel and Secretary of the
Company or of other counsel satisfactory to the Manager and who may be an
officer of the Company, dated the Closing Date, to the effect that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State
of New York, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its consolidated
subsidiaries, taken as a whole;
(ii) each of the Company and its subsidiaries has all
necessary consents, authorizations, approvals, orders, certificates and
permits of and from, and has made all declarations and filings with,
all Federal, state, local and other governmental authorities, all
self-regulatory organizations and all courts and other tribunals, to
own, lease, license and use its properties and assets and to conduct
its business in the manner described in the Prospectus, except to the
extent that the failure to obtain or file would not have a material
adverse effect on the Company and its consolidated subsidiaries, taken
as a whole;
10
<PAGE>
(iii) the Subordinated Debt Indenture has been duly qualified
under the Trust Indenture Act and has been duly authorized, executed
and delivered by the Company, is a valid and binding agreement of the
Company, enforceable in accordance with its terms except in each case
as the enforceability thereof (a) may be limited by bankruptcy,
insolvency, reorganization, liquidation, moratorium and other similar
laws affecting creditors' rights generally and (b) is subject to
general principles of equity, regardless of whether such enforceability
is considered in a proceeding in equity or at law;
(iv) the Subordinated Debentures have been duly authorized by
the Company and, when executed and authenticated in accordance with the
provisions of the Subordinated Debt Indenture and delivered to and paid
for as described in the Prospectus, will be entitled to the benefits of
the Subordinated Debt Indenture and will be valid and binding
obligations of the Company, enforceable in accordance with their terms
except as the enforceability thereof (a) may be limited by bankruptcy,
insolvency, reorganization, liquidation, moratorium and other similar
laws affecting creditors' rights generally and (b) is subject to
general principles of equity, regardless of whether such enforceability
is considered in a proceeding in equity or at law;
(v) this Agreement has been duly authorized, executed and
delivered by the Company;
(vi) the Guarantee has been duly qualified under the Trust
Indenture Act and has been duly authorized, executed and delivered by
the Company and is a valid and binding obligation of the Company
enforceable in accordance with its terms except as the enforceability
thereof (a) may be limited by bankruptcy, insolvency, reorganization,
liquidation, moratorium and other similar laws affecting creditors'
rights generally and (b) is subject to general principles of equity,
regardless of whether such enforceability is considered in a proceeding
in equity or at law;
(vii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under this Agreement, the
Subordinated Debt Indenture, the Declaration, the Guarantee, and the
Subordinated Debentures do not contravene any provisions of applicable
law or the certificate of incorporation or by-laws of the Company or
any agreement or other instrument binding upon the Company or any
agreement or other instrument binding upon the Company or any of its
subsidiaries that is material to the Company and its consolidated
subsidiaries, taken as a whole, or, to the best of such counsel's
knowledge, any judgment, order or decree of any governmental body or
agency is required for the performance by the Company of its
obligations under this Agreement, the Subordinated Debt Indenture, the
Declaration, the Guarantee, and the Subordinated Debentures, except as
may be required under the
11
<PAGE>
securities or blue sky laws of the various states in connection with
the offer and sale of the Offered Capital Securities; provided, however
that such counsel need not express an opinion as to whether the
purchase of the Offered Capital Securities constitutes a "prohibited
transaction" under Section 406 of the Employee Retirement Security Act
of 1974, as amended, or Section 4975 of the Internal Revenue Code of
1986, as amended;
(viii) the Issuer Trust is not and, after giving effect to the
offering and sale of the Offered Capital Securities and the application
of the proceeds thereof as described in the Prospectus, will not be an
"investment company" as such term is defined in the Investment Company
Act of 1940, as amended;
(ix) the statements (1) in the Basic Prospectus under the
caption "Description of Debt Securities," (2) in the Prospectus
Supplement under the caption "Description of Subordinated Debentures,"
(3) in the Registration Statement under Item 15, (4) in "Item 3 - Legal
Proceedings" of the most recent annual report on Form 10-K incorporated
by reference in the Prospectus and (5) in "Item 1 - Legal Proceedings"
of Part II of the quarterly reports on Form 10-Q, if any, filed since
such annual report and incorporated by reference in the Prospectus, in
each case insofar as such statements constitute summaries of the legal
matters, documents or proceedings referred to therein, fairly present
the information called for with respect to such legal matters,
documents and proceedings and fairly summarize the matters referred to
therein;
(x) after due inquiry, such counsel does not know of any legal
or governmental proceedings pending or threatened to which the Company
or any of its consolidated subsidiaries or the Issuer Trust is a party
or to which any of the properties of the Company or any of its
consolidated subsidiaries or the Issuer Trust is subject that are
required to be described in the Registration Statement or the
Prospectus and are not so described or of any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed or incorporated
by reference as exhibits to the Registration Statement that are not
described, filed or incorporated by reference as required; and
(xi) such counsel (1) is of the opinion that each document, if
any, filed pursuant to the Exchange Act and incorporated by reference
in the Registration Statement and the Prospectus (except as to
financial statements and schedules included therein as to which such
counsel need not express any opinion) complied when so filed as to form
in all material respects with the Exchange Act and the applicable rules
and regulations of the Commission thereunder, (2) has no reason to
believe that any part of the Registration Statement (except as to
financial statements and schedules included therein, as to which such
counsel need not express any belief, and except for that part of the
Registration Statement that
12
<PAGE>
constitutes Forms T-1), on the date such part became effective
contained, and the Registration Statement (except as to financial
statements and schedules included therein, as to which such counsel
need not express any belief, and except for the part of the
Registration Statement that constitutes Forms T-1) as of the date such
opinion is delivered contains any untrue statement of a material fact
or omitted or omits to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (3)
is of the opinion that the Registration Statement and the Prospectus
(except as to financial statements and schedules included therein, as
to which such counsel need not express any opinion) comply as to form
in all material respects with the Securities Act and the applicable
rules and regulations of the Commission thereunder and (4) has no
reason to believe that the Prospectus (except as to financial
statements and schedules included therein as to which such counsel need
not express any belief) as of the date such opinion is delivered
contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(c) The Manager shall have received on the Closing Date an opinion of
Skadden, Arps, Slate, Meagher & Flom LLP, special counsel for the Underwriters,
dated the Closing Date, in agreed form.
(d) The Manager shall have received on the Closing Date an opinion
dated the Closing Date of Skadden, Arps, Slate, Meagher & Flom LLP, special
Delaware counsel for the Issuer Trust and special tax counsel to the Company, or
of other counsel satisfactory to the Manager, in agreed form.
(e) The Underwriters shall have received (A) on the date of this
Agreement a letter, dated the date of this Agreement, and (B) on the Closing
Date a letter, dated the Closing Date, in form and substance satisfactory to the
Manager, from the Company's independent auditors, containing statements and
information of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in or incorporated by reference into the Prospectus.
(f) On the Closing Date, counsel for the Underwriters shall have been
furnished with such additional documents and opinions as they may require for
the purpose of enabling them to pass upon the issuance and sale of the Offered
Capital Securities as herein contemplated, or in order to evidence the accuracy
of any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained and all proceedings taken by the Company and the
Issuer Trust in connection with the issuance and sale of the Offered Capital
Securities as herein contemplated shall be reasonably satisfactory in form and
substance to the Manager and counsel for the Underwriters.
13
<PAGE>
5. Covenants of the Company and the Issuer Trust. In further
consideration of the agreements of the Underwriters contained herein, each of
the Company and the Issuer Trust covenants as follows:
(a) To furnish the Manager, without charge, a conformed copy of the
Registration Statement (including exhibits and all amendments thereto) and for
delivery to each other Underwriter a conformed copy of the Registration
Statement (without exhibits thereto) and, during the period mentioned in
paragraph (c) below, as many copies of the Prospectus, any documents
incorporated by reference therein and any supplements and amendments thereto or
to the Registration Statement as the Manager may reasonably request.
(b) Before amending or supplementing the Registration Statement or the
Prospectus with respect to the Offered Capital Securities, to furnish to the
Manager a copy of each such proposed amendment or supplement and not to file any
such proposed amendment or supplement to which the Manager reasonably objects.
(c) If, during such period after the first date of the public offering
of the Offered Capital Securities as in the opinion of counsel for the
Underwriters the Prospectus is required by law to be delivered in connection
with sales by an Underwriter or dealer, any event shall occur or condition exist
as a result of which it is necessary to amend or supplement the Prospectus in
order to make the statements therein, in the light of the circumstances existing
when the Prospectus is delivered to a purchaser, not misleading, or if in the
opinion of counsel for the Underwriters, it is necessary to amend or supplement
the Prospectus to comply with law, forthwith to prepare and furnish, at its own
expense, to the Underwriters and to the dealers (whose names and addresses the
Manager will furnish to the Company) to which Offered Capital Securities may
have been sold by the Manager on behalf of the Underwriters and to any other
dealers upon request, either amendments or supplements to the Prospectus,
satisfactory in all respects to the Manager, so that the statements in the
Prospectus as so amended or supplemented will not, in the light of the
circumstances existing when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as so amended or supplemented, will comply
with law and to cause such amendments or supplements to be filed promptly with
the Commission.
(d) To endeavor to qualify the Offered Capital Securities and the
Guarantee for offer and sale under the securities or blue sky laws of such
jurisdictions as the Manager shall reasonably request and to maintain such
qualifications for as long as the Manager shall reasonably request.
(e) To make generally available to the Company's security holders and
to the Manager as soon as practicable an earning statement covering a twelve
month period beginning on the first day of the first full fiscal quarter after
the date of the Underwriting Agreement, which earning statement shall satisfy
the provisions of Section 11(a) of the
14
<PAGE>
Securities Act and the rules and regulations of the Commission thereunder. If
such fiscal quarter is the first fiscal quarter of the Company's fiscal year,
such earning statement shall be made available not later than 90 days after the
close of the period covered thereby and in all other cases shall be made
available not later than 45 days after the close of the period covered thereby.
(f) During the period beginning on the date of this Agreement and
continuing to and including the Closing Date, not to offer, sell, contract to
sell or otherwise dispose of any securities with characteristics similar to
those of the Offered Capital Securities (other than the Offered Capital
Securities), without the prior consent of the Manager.
(g) Whether or not any sale of Offered Capital Securities is
consummated, to pay all expenses incident to the performance of the Company's
and the Issuer Trust's obligations under this Agreement, including: (i) the
preparation and filing of the Registration Statement and the Prospectus and all
amendments and supplements thereto, (ii) the preparation, issuance and delivery
of the Offered Capital Securities, (iii) the fees and disbursements of the
Company's counsel and accountants, of the Issuer Trust's counsel and of the
Issuer Trustees and their counsel, (iv) the qualification of the Offered Capital
Securities and the Guarantee under securities or blue sky laws in accordance
with the provisions of Section 6(d), including filing fees and the fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of any blue sky or Legal Investment Memoranda,
(v) the printing and delivery to the Underwriters in quantities as hereinabove
stated of copies of the Registration Statement and all amendments thereto and of
the Prospectus and any amendments or supplements thereto, (vi) the printing and
delivery to the Underwriters of copies of any blue sky or Legal Investment
Memoranda, (vii) any fees charged by rating agencies for the rating of the
Offered Capital Securities, (viii) any expenses incurred by the Company or the
Issuer Trust in connection with a "road show" presentation to potential
investors, (ix) all document production charges of counsel to the Underwriters
and (x) any filing fees in connection with any review of the offering of the
Offered Capital Securities by the National Association of Securities Dealers,
Inc.
6. Indemnification and Contribution. Each of the Company and the Issuer
Trust jointly and severally, agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
in connection with defending or investigating any such action or claim) caused
by any untrue statement or allegedly untrue statement of a material fact
contained in the Registration Statement or any amendment thereof, any
preliminary Prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses,
15
<PAGE>
claims, damages or liabilities are caused by any such untrue statement or
omission or allegedly untrue statement or omission based upon information
relating to any Underwriter furnished to the Company or the Issuer Trust in
writing by such Underwriter through the Manager expressly for use therein;
provided, however, that the foregoing indemnity agreement with respect to any
preliminary Prospectus shall not inure to the benefit of any Underwriter from
whom the person asserting any such losses, claims, damages or liabilities
purchased Offered Capital Securities, or any person controlling such
Underwriter, if a copy of the Prospectus (as then amended or supplemented if the
Company or the Issuer Trust shall have furnished any amendments or supplements
thereto) was not sent or given by or on behalf of such Underwriter to such
person, if required by law so to have been delivered, at or prior to the written
confirmation of the sale of the Offered Capital Securities to such person, and
if the Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities.
Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Issuer Trust, the Issuer Trustees, the Company, its directors,
its officers who sign the Registration Statement and each person, if any, who
controls the Issuer Trust or the Company within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act to the same extent as
the foregoing indemnity from the Company and the Issuer Trust to each
Underwriter, but only with reference to information relating to such Underwriter
furnished to the Company or the Issuer Trust by such Underwriter in writing
through the Manager expressly for use in the Registration Statement, any
preliminary Prospectus, the Prospectus or any amendments or supplements thereto.
In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to either of the two preceding paragraphs, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be
16
<PAGE>
reimbursed as they are incurred. Such firm shall be designated in writing by the
Manager, in the case of parties indemnified pursuant to the second preceding
paragraph, and by the Company and the Issuer Trust, in the case of parties
indemnified pursuant to the first preceding paragraph. The indemnifying party
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the third
sentence of this paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
To the extent the indemnification provided for in the first or second
paragraph in this Section 6 is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then each indemnifying party under such paragraph, in lieu of
indemnifying such indemnified party thereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Issuer Trust on the one hand
and the Underwriters on the other hand from the offering of the Offered
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 and the Issuer Trust on the one hand and the Underwriters
on the other hand in connection with the statements or omissions that resulted
in such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Issuer Trust on the one hand and the Underwriters on the other hand in
connection with the offering of the Offered Capital Securities shall be deemed
to be in the same respective proportions as the net proceeds from the offering
of such Offered Securities (before deducting expenses) received by the Company
and the Issuer Trust and the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on the
cover of the Prospectus Supplement, bear to the aggregate public offering price
of the Offered Capital Securities. The relative fault of the Company and the
Issuer Trust on the one hand and of the Underwriters on the other hand shall be
17
<PAGE>
determined by reference to, among other things, whether the untrue or allegedly
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company and the Issuer
Trust or by the Underwriters and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The Company, the Issuer Trust and the Underwriters agree that it would
not be just or equitable if contribution pursuant to this Section 6 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 6, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Offered Capital Securities underwritten by it and distributed
to the public were offered to the public exceeds the amount of any damages that
such Underwriter has otherwise been required to pay by reason of such untrue or
allegedly untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' respective
obligations to contribute pursuant to this Section 6 are several in proportion
to the respective amounts of Offered Capital Securities purchased by each of
such Underwriters and not joint. The remedies provided for in this Section 6 are
not exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
7. Termination. This Agreement shall be subject to termination by
notice given by the Manager to the Company, if (a) after the execution and
delivery of this Agreement and prior to the Closing Date (i) trading
generally shall have been suspended or materially limited on or by, as the
case may be, any of the New York Stock Exchange, the American Stock Exchange,
the National Association of Securities Dealers, Inc., the Chicago Board of
Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade, (ii) trading of any securities of the Company or, the Issuer Trust
shall have been suspended on any exchange or in any over-the-counter market,
(iii) a general moratorium on commercial banking activities in New York shall
have been declared by either Federal or New York State authorities, or (iv)
there shall have occurred any outbreak or escalation of hostilities or any
change in financial markets or any calamity or crisis that, in the judgment
of the Manager, is material and adverse, and (b) in the case of any of the
events specified in clauses (a)(i) through (iv), such event, singly or
together with any other such event, makes it, in the judgment of the Manager,
impracticable to market the Offered Capital Securities on the terms and in
the manner contemplated in the Prospectus.
18
<PAGE>
8. Defaulting Underwriters. If, on the Closing Date or the Option
Closing Date, as the case may be, any one or more of the Underwriters shall fail
or refuse to purchase Offered Capital Securities that it has or they have agreed
to purchase under this Agreement on such date, and the aggregate number of
Offered Capital Securities which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate number of the Offered Capital Securities to be purchased on such date,
the other Underwriters shall be obligated severally in the proportions that the
number of Firm Capital Securities set forth opposite their respective names in
Schedule I to this Agreement bears to the aggregate number of Firm Capital
Securities set forth opposite the names of all such non-defaulting Underwriters,
or in such other proportions as the Manager may specify, to purchase the Offered
Capital Securities which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase on such date; provided that in no event shall the
number of Offered Capital Securities that any Underwriter has agreed to purchase
pursuant to this Agreement be increased pursuant to this Section 8 by an amount
in excess of one-ninth of such number of Offered Capital Securities without the
written consent of such Underwriter. If, on the Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Additional Capital Securities and
the aggregate number of Additional Capital Securities with respect to which such
default occurs is more than one-tenth of the aggregate number of Additional
Capital Securities to be purchased, and arrangements satisfactory to us and the
Company for the purchase of such Additional Capital Securities are not made
within 36 hours after such default, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter, the Company or the
Issuer Trust. In any such case either the Manager or the Company shall have the
right to postpone the Closing Date, but in no event for longer than seven days,
in order that the required changes, if any, in the Registration Statement and in
the Prospectus or in any other documents or arrangements may be effected. If, on
the Option Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Additional Capital Securities and the aggregate number of Additional
Capital Securities with respect to which such default occurs is more than
one-tenth of the aggregate number of Additional Capital Securities to be
purchased, the non-defaulting Underwriters shall have the option to (i)
terminate their obligation to purchase Additional Capital Securities or (ii)
purchase not less than the number of Additional Capital Securities that such
non-defaulting Underwriters would have been obligated to purchase in the absence
of such default. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company or the Issuer
Trust to comply with the terms or to fulfill any of the conditions of this
Agreement, or if for any reason the Company or the Issuer Trust shall be unable
to perform its obligations under this
19
<PAGE>
Agreement, the Company and the Issuer Trust jointly and severally agree to
reimburse the Underwriters or such Underwriters as have so terminated this
Agreement with respect to themselves, severally, for all out-of-pocket expenses
(including the fees and disbursements of their counsel) reasonably incurred by
such Underwriters in connection with this Agreement or the offering of the
Offered Capital Securities.
9. Representations and Indemnities to Survive. The respective indemnity
and contribution agreements and the representations, warranties and other
statements of the Issuer Trust the Company, its officers and the Underwriters
set forth in this Agreement will remain in full force and effect, regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Underwriter or any person controlling any Underwriter or by or on
behalf of the Company, its officers or directors or any person controlling the
Company or on behalf of the Issuer Trust, the Issuer Trustees or any person
controlling the Issuer Trust and (iii) acceptance of and payment for any of the
Offered Capital Securities.
10. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers, directors and Issuer Trustees and controlling persons referred to in
Section 6, and no other person will have any right or obligation hereunder.
11. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
12. Applicable Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York.
13. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
20
<PAGE>
Please confirm your agreement by having an authorized officer sign a copy of
this Agreement in the space set forth below.
Very truly yours,
MORGAN STANLEY & CO.
INCORPORATED
MERRILL LYNCH, PIERCE
FENNER & SMITH INCORPORATED
A.G. EDWARDS & SONS, INC.
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES
INCORPORATED
SALOMON SMITH BARNEY INC.
On behalf of themselves and the
other Underwriters named herein
By: MORGAN STANLEY & CO.
INCORPORATED
By: /s/ Michael M. Fusco
---------------------------
Name: Michael M. Fusco
Title: Vice President
Accepted:
INTERNATIONAL PAPER COMPANY
By: /s/ E. William Boehmler
------------------------------------
Name: E. William Boehmler
Title: Vice President and Treasurer
INTERNATIONAL PAPER COMPANY CAPITAL TRUST III
By: International Paper Company, as
Depositor
By: /s/ Robert C. McPhillips
------------------------------------
Name: Robert C. McPhillips
Title: Regular Trustee
21
<PAGE>
Schedule I
<TABLE>
<CAPTION>
Number of
Firm Capital Securities
Underwriter To Be Purchased
- ----------- ---------------
<S> <C>
MORGAN STANLEY & CO. INCORPORATED................................................................ 3,466,000
MERRILL LYNCH, PIERCE FENNER & SMITH INCORPORATED................................................ 3,463,000
A.G. EDWARDS & SONS, INC......................................................................... 3,463,000
PAINEWEBBER INCORPORATED......................................................................... 3,463,000
PRUDENTIAL SECURITIES INCORPORATED............................................................... 3,463,000
SALOMON SMITH BARNEY INC......................................................................... 3,463,000
CREDIT SUISSE FIRST BOSTON CORPORATION........................................................... 1,400,000
GOLDMAN, SACHS & CO.............................................................................. 1,400,000
J.P. MORGAN SECURITIES INC....................................................................... 1,400,000
BEAR, STEARNS & CO. INC............................................................................ 116,500
BT ALEX BROWN INCORPORATED......................................................................... 116,500
CIBC OPPENHEIMER CORP.............................................................................. 116,500
SG COWEN SECURITIES CORPORATION.................................................................... 116,500
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION................................................ 116,500
SCHRODER & CO. INC................................................................................. 116,500
ADVEST, INC......................................................................................... 58,000
ROBERT W. BAIRD & CO. INCORPORATED.................................................................. 58,000
BANCAMERICA SECURITIES, INC......................................................................... 58,000
WILLIAM BLAIR & COMPANY, L.L.C...................................................................... 58,000
BLAYLOCK & PARTNERS, L.P............................................................................ 58,000
J.C. BRADFORD & CO.................................................................................. 58,000
CRAIGIE INCORPORATED................................................................................ 58,000
CROWELL, WEEDON & CO................................................................................ 58,000
DAIN RAUSCHER WESSELS............................................................................... 58,000
DAVENPORT & COMPANY LLC............................................................................. 58,000
FAHNESTOCK & CO. INC................................................................................ 58,000
FERRIS, BAKER WATTS, INCORPORATED................................................................... 58,000
FIDELITY CAPITAL MARKETS
A DIVISION OF NATIONAL FINANCIAL SERVICES CORPORATION............................................. 58,000
FIFTH THIRD/THE OHIO COMPANY........................................................................ 58,000
FIRST ALBANY CORPORATION............................................................................ 58,000
FIRST OF MICHIGAN CORPORATION....................................................................... 58,000
GIBRALTAR SECURITIES CO............................................................................. 58,000
J.J.B. HILLIARD, W.L. LYONS, INC.................................................................... 58,000
INTERSTATE/JOHNSON LANE CORPORATION................................................................. 58,000
JANNEY MONTGOMERY SCOTT INC......................................................................... 58,000
JWGENESIS SECURITIES, INC........................................................................... 58,000
KIRKPATRICK, PETTIS, SMITH, POLAN INC............................................................... 58,000
LEGG MASON WOOD WALKER, INCORPORATED................................................................ 58,000
</TABLE>
22
<PAGE>
<TABLE>
<CAPTION>
Number of
Firm Capital Securities
Underwriter To Be Purchased
- ----------- ---------------
<S> <C>
MCDONALD & COMPANY SECURITIES, INC.................................................................. 58,000
MESIROW FINANCIAL, INC.............................................................................. 58,000
MORGAN KEEGAN & COMPANY, INC........................................................................ 58,000
OLDE DISCOUNT CORPORATION........................................................................... 58,000
PIPER JAFFRAY INC................................................................................... 58,000
RAYMOND JAMES & ASSOCIATES, INC..................................................................... 58,000
THE ROBINSON-HUMPHREY COMPANY, LLC.................................................................. 58,000
RONEY CAPITAL MARKETS A DIVISION OF FIRST CHICAGO................................................... 58,000
SCOTT & STRINGFELLOW, INC........................................................................... 58,000
MURIEL SIEBERT & CO., INC........................................................................... 58,000
STERNE, AGEE & LEACH, INC........................................................................... 58,000
STIFEL, NICOLAUS & COMPANY, INCORPORATED............................................................ 58,000
SUTRO & CO. INCORPORATED............................................................................ 58,000
TUCKER ANTHONY INCORPORATED......................................................................... 58,000
UTENDAHL CAPITAL PARTNERS, L.P...................................................................... 58,000
WEDBUSH MORGAN SECURITIES........................................................................... 58,000
WHEAT FIRST SECURITIES, INC......................................................................... 58,000
------
Total........................................................................................... 28,000,000
</TABLE>
23
<PAGE>
Exhibit 4.5
- --------------------------------------------------------------------------------
INTERNATIONAL PAPER COMPANY
TO
THE BANK OF NEW YORK
Trustee
----------
Indenture
Dated as of September 15, 1998
----------
Subordinated Debt Securities
- --------------------------------------------------------------------------------
<PAGE>
INTERNATIONAL PAPER COMPANY
Reconciliation and tie between Trust Indenture Act of 1939
and Indenture, dated as of September 15, 1998
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
<S> <C>
Section 310(a)(1) ..................................... 6.9
(a)(2) ..................................... 6.9
(a)(3) ..................................... Not Applicable
(a)(4) ..................................... Not Applicable
(b) ..................................... 6.8
Section 311(a) ..................................... 6.10
(b) ..................................... 6.10
(b)(2) ..................................... 6.10
Section 312(a) ..................................... 7.1(a)
(b) ..................................... 7.1(b)
(c) ..................................... 7.1(c)
Section 313(a) ..................................... 7.2
(b) ..................................... 7.2
(c) ..................................... 7.2
(d) ..................................... 7.2
Section 314(a) ..................................... Not Applicable
(b) ..................................... Not Applicable
(c)(1) ..................................... 1.2
(c)(2) ..................................... 1.2
(c)(3) ..................................... Not Applicable
(d) ..................................... Not Applicable
(e) ..................................... 1.2
Section 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) ..................................... 5.14
Section 316(a) ..................................... 1.4
(a)(1)(A) ..................................... 5.2
..................................... 5.12
(a)(1)(B) ..................................... 5.13
(a)(2) ..................................... Not Applicable
(b) ..................................... 5.8
Section 317(a)(1) ..................................... 5.3
(a)(2) ..................................... 5.4
(b) ..................................... 10.3
Section 318(a) ..................................... 10.8
</TABLE>
- ----------
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Indenture.
<PAGE>
TABLE OF CONTENTS(1)
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Parties.................................................................. 1
Recitals of the Company.................................................. 1
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1 DEFINITIONS.............................................. 1
Act...................................................................... 2
Affiliate................................................................ 2
Authenticating Agent..................................................... 2
Authorized Newspaper..................................................... 2
Bearer Security.......................................................... 2
Board of Directors....................................................... 2
Board Resolution......................................................... 2
Book-Entry Security...................................................... 2
Business Day............................................................. 3
Change in Control........................................................ 3
Commission............................................................... 3
Common Stock............................................................. 3
Company.................................................................. 3
Company Request or Company Order......................................... 3
Continuing Director...................................................... 3
Corporate Trust Office................................................... 3
Corporation.............................................................. 3
Coupon................................................................... 3
Defaulted Interest....................................................... 4
Depository............................................................... 4
Dollar or $.............................................................. 4
Euro-clear............................................................... 4
Event of Default......................................................... 4
Exchange Date............................................................ 4
Exercise Period.......................................................... 4
Holder................................................................... 4
Indenture................................................................ 4
Interest................................................................. 4
Interest Payment Date.................................................... 4
Junior Subordinated Payment.............................................. 4
Maturity................................................................. 4
Officers' Certificate.................................................... 4
Opinion of Counsel....................................................... 5
Original Issue Discount Security......................................... 5
Outstanding.............................................................. 5
</TABLE>
- --------
(1) 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>
Paying Agent............................................................. 6
Person................................................................... 6
Place of Payment......................................................... 6
Predecessor Security..................................................... 6
Proceeding............................................................... 6
Redemption Date.......................................................... 6
Redemption Price......................................................... 6
Registered Security...................................................... 6
Regular Record Date...................................................... 6
Responsible Officer...................................................... 7
Securities............................................................... 7
Security Register........................................................ 7
Senior Indebtedness...................................................... 7
Special Record Date...................................................... 8
Stated Maturity.......................................................... 8
Subsidiary............................................................... 8
Trustee.................................................................. 8
Trustee.................................................................. 8
Trust Indenture Act...................................................... 8
United States............................................................ 8
United States Alien...................................................... 8
U.S. Government Obligations.............................................. 8
Vice President........................................................... 9
Yield to Maturity........................................................ 9
</TABLE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 1.2 COMPLIANCE CERTIFICATES AND OPINIONS..................... 9
SECTION 1.3 FORM OF DOCUMENTS DELIVERED TO TRUSTEE................... 10
SECTION 1.4 ACTS OF HOLDERS.......................................... 10
SECTION 1.5 NOTICES, ETC., TO TRUSTEE AND COMPANY.................... 13
SECTION 1.6 NOTICE TO HOLDERS OF SECURITIES; WAIVER.................. 14
SECTION 1.7 LANGUAGE OF NOTICES, ETC................................. 15
SECTION 1.8 CONFLICT WITH TRUST INDENTURE ACT........................ 15
SECTION 1.9 EFFECT OF HEADINGS AND TABLE OF CONTENTS................. 15
SECTION 1.10 SUCCESSORS AND ASSIGNS................................... 15
SECTION 1.11 SEPARABILITY CLAUSE...................................... 15
SECTION 1.12 BENEFITS OF INDENTURE.................................... 15
SECTION 1.13 GOVERNING LAW............................................ 15
SECTION 1.14 LEGAL HOLIDAYS........................................... 16
ARTICLE II
SECURITY FORMS
SECTION 2.1 FORMS GENERALLY.......................................... 16
SECTION 2.2 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.......... 17
SECTION 2.3 SECURITIES IN GLOBAL FORM................................ 17
SECTION 2.4 FORM OF LEGEND FOR BOOK-ENTRY SECURITIES................. 18
SECTION 2.5 FORM OF CONVERSION NOTICE................................ 18
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
ARTICLE III
THE SECURITIES
SECTION 3.1 AMOUNT UNLIMITED; ISSUABLE IN SERIES..................... 18
SECTION 3.2 DENOMINATIONS............................................ 22
SECTION 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING........... 22
SECTION 3.4 TEMPORARY SECURITIES..................................... 24
SECTION 3.5 REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE...... 26
SECTION 3.6 MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES
AND COUPONS ............................................ 29
SECTION 3.7 PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED........... 30
SECTION 3.8 PERSONS DEEMED OWNERS.................................... 32
SECTION 3.9 CANCELLATION............................................. 32
SECTION 3.10 COMPUTATION OF INTEREST.................................. 33
SECTION 3.11 ELECTRONIC SECURITY ISSUANCE............................. 33
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 SATISFACTION AND DISCHARGE OF INDENTURE.................. 33
SECTION 4.2 APPLICATION OF TRUST MONEY............................... 34
SECTION 4.3 SATISFACTION, DISCHARGE AND DEFEASANCE OF SECURITIES OF
ANY SERIES.............................................. 35
ARTICLE V
REMEDIES
SECTION 5.1 EVENTS OF DEFAULT........................................ 38
SECTION 5.2 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT....... 39
SECTION 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY TRUSTEE............................... 40
SECTION 5.4 TRUSTEE MAY FILE PROOFS OF CLAIM......................... 41
SECTION 5.5 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
SECURITIES OR COUPONS................................ 42
SECTION 5.6 APPLICATION OF MONEY COLLECTED........................... 42
SECTION 5.7 LIMITATION ON SUITS...................................... 42
SECTION 5.8 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE
PRINCIPAL, PREMIUM AND INTEREST...................... 43
SECTION 5.9 RESTORATION OF RIGHTS AND REMEDIES....................... 43
SECTION 5.10 RIGHTS AND REMEDIES CUMULATIVE........................... 43
SECTION 5.11 DELAY OR OMISSION NOT WAIVER............................. 44
SECTION 5.12 CONTROL BY HOLDERS OF SECURITIES......................... 44
SECTION 5.13 WAIVER OF PAST DEFAULTS.................................. 44
SECTION 5.14 UNDERTAKING FOR COSTS.................................... 45
SECTION 5.15 WAIVER OF STAY OR EXTENSION LAWS......................... 45
ARTICLE VI
THE TRUSTEE
SECTION 6.1 CERTAIN RIGHTS OF TRUSTEE................................ 45
</TABLE>
iii
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 6.2 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
SECURITIES.............................................. 46
SECTION 6.3 MAY HOLD SECURITIES...................................... 47
SECTION 6.4 MONEY HELD IN TRUST...................................... 47
SECTION 6.5 COMPENSATION AND REIMBURSEMENT........................... 47
SECTION 6.6 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR........ 47
SECTION 6.7 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR................... 49
SECTION 6.8 DISQUALIFICATION; CONFLICTING INTERESTS.................. 50
SECTION 6.9 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.................. 50
SECTION 6.10 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY........ 50
SECTION 6.11 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS................................................ 51
SECTION 6.12 APPOINTMENT OF AUTHENTICATING AGENT...................... 51
ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 7.1 PRESERVATION OF INFORMATION; COMMUNICATIONS TO
HOLDERS................................................. 53
SECTION 7.2 REPORTS BY TRUSTEE....................................... 54
ARTICLE VIII
CONSOLIDATION, MERGER, SALE, LEASE, TRANSFER
OR OTHER DISPOSITION
SECTION 8.1 COMPANY MAY CONSOLIDATE, ETC. ONLY ON CERTAIN TERMS...... 54
SECTION 8.2 SUCCESSOR SUBSTITUTED.................................... 55
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS....... 56
SECTION 9.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.......... 57
SECTION 9.3 EXECUTION OF SUPPLEMENTAL INDENTURES..................... 59
SECTION 9.4 EFFECT OF SUPPLEMENTAL INDENTURES........................ 59
SECTION 9.5 CONFORMITY WITH TRUST INDENTURE ACT...................... 59
SECTION 9.6 REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES....... 59
SECTION 9.7 SUBORDINATION UNIMPAIRED................................. 59
ARTICLE X
COVENANTS
SECTION 10.1 PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST............... 59
SECTION 10.2 MAINTENANCE OF OFFICE OR AGENCY.......................... 60
SECTION 10.3 MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST........ 61
SECTION 10.4 ADDITIONAL AMOUNTS....................................... 62
SECTION 10.5 EXISTENCE................................................ 63
SECTION 10.6 PURCHASE OF SECURITIES BY COMPANY OR SUBSIDIARY.......... 63
SECTION 10.7 STATEMENT BY OFFICERS AS TO DEFAULT...................... 64
</TABLE>
iv
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 11.1 APPLICABILITY OF ARTICLE................................. 64
SECTION 11.2 ELECTION TO REDEEM; NOTICE TO TRUSTEE.................... 64
SECTION 11.3 SELECTION BY TRUSTEE OF SECURITIES TO BE REDEEMED........ 64
SECTION 11.4 NOTICE OF REDEMPTION..................................... 65
SECTION 11.5 DEPOSITION OF REDEMPTION PRICE........................... 66
SECTION 11.6 SECURITIES PAYABLE ON REDEMPTION DATE.................... 66
SECTION 11.7 SECURITIES REDEEMED IN PART.............................. 67
ARTICLE XII
SINKING FUNDS
SECTION 12.1 APPLICABILITY OF ARTICLE................................. 67
SECTION 12.2 SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.... 68
SECTION 12.3 REDEMPTION OF SECURITIES FOR SINKING FUND................ 68
ARTICLE XIII
MEETINGS OF HOLDERS OF SECURITIES
SECTION 13.1 PURPOSES FOR WHICH MEETINGS MAY BE CALLED................ 69
SECTION 13.2 CALL, NOTICE AND PLACE OF MEETINGS....................... 69
SECTION 13.3 PERSONS ENTITLED TO VOTE AT MEETINGS..................... 69
SECTION 13.4 QUORUM; ACTION........................................... 70
SECTION 13.5 DETERMINATION OF VOTING RIGHTS; CONDUCT AND ADJOURNMENT
OF MEETINGS............................................. 71
SECTION 13.6 COUNTING VOTES AND RECORDING ACTION OF MEETINGS.......... 72
ARTICLE XIV
REDEMPTION OF SECURITIES AT OPTION OF HOLDERS
SECTION 14.1 APPLICABILITY OF ARTICLE................................. 72
SECTION 14.2 REDEMPTION AT OPTION OF HOLDERS UPON A CHANGE IN
CONTROL OF THE COMPANY.................................. 72
SECTION 14.3 NOTICE OF CHANGE IN CONTROL.............................. 73
SECTION 14.4 DEPOSIT OF REDEMPTION PRICE.............................. 74
ARTICLE XV
CONVERSION OF SECURITIES
SECTION 15.1 APPLICABILITY OF ARTICLE................................. 74
SECTION 15.2 EXERCISE OF CONVERSION PRIVILEGE......................... 74
SECTION 15.3 NO FRACTIONAL SHARES..................................... 75
SECTION 15.4 ADJUSTMENT OF CONVERSION PRICE........................... 76
SECTION 15.5 NOTICE OF CERTAIN CORPORATE ACTIONS...................... 76
SECTION 15.6 RESERVATION OF SHARES OF COMMON STOCK.................... 77
SECTION 15.7 PAYMENT OF CERTAIN TAXES UPON CONVERSION................. 77
SECTION 15.8 NONASSESSABILITY......................................... 78
</TABLE>
v
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 15.9 EFFECT OF CONSOLIDATION OR MERGER ON CONVERSION
PRIVILEGE............................................... 78
SECTION 15.10 DUTIES OF TRUSTEE REGARDING CONVERSION................... 79
SECTION 15.11 REPAYMENT OF CERTAIN FUNDS UPON CONVERSION............... 79
ARTICLE XVI
SUBORDINATION OF SECURITIES
SECTION 16.1 SECURITIES SUBORDINATE TO SENIOR INDEBTEDNESS............ 80
SECTION 16.2 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC........... 80
SECTION 16.3 PRIOR PAYMENT TO SENIOR INDEBTEDNESS UPON ACCELERATION
OF SECURITIES........................................... 81
SECTION 16.4 NO PAYMENT WHEN SENIOR INDEBTEDNESS IN DEFAULT........... 82
SECTION 16.5 PAYMENT PERMITTED IF NO DEFAULT.......................... 82
SECTION 16.6 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR
INDEBTEDNESS............................................ 83
SECTION 16.7 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.............. 83
SECTION 16.8 TRUSTEE TO EFFECTUATE SUBORDINATION...................... 84
SECTION 16.9 NO WAIVER OF SUBORDINATION PROVISIONS.................... 84
SECTION 16.10 NOTICE TO TRUSTEE........................................ 85
SECTION 16.11 RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT................................................... 85
SECTION 16.12 TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR
INDEBTEDNESS............................................ 86
SECTION 16.13 RIGHTS OF TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS;
PRESERVATION OF TRUSTEE'S RIGHTS........................ 86
SECTION 16.14 ARTICLE APPLICABLE TO PAYING AGENTS...................... 86
SECTION 16.15 DEFEASANCE OF THIS ARTICLE SIXTEEN....................... 86
SECTION 16.16 CERTAIN CONVERSIONS DEEMED PAYMENT....................... 86
</TABLE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
EXHIBIT A................................................................ A-1
EXHIBIT B................................................................ B-1
EXHIBIT C................................................................ C-1
EXHIBIT D................................................................ D-1
EXHIBIT E................................................................ E-1-1
EXHIBIT E.1.............................................................. E-1-1
EXHIBIT E.2.............................................................. E-1-2
EXHIBIT E.3.............................................................. E-3-1
EXHIBIT E.4.............................................................. E-4-1
</TABLE>
vi
<PAGE>
INDENTURE, dated as of September 15, 1998, between International Paper
Company, a corporation duly organized and existing under the laws of the State
of New York (herein called the "Company"), having its principal office at Two
Manhattanville Road, Purchase, New York 10577, and The Bank of New York, a
banking association duly organized and existing under the laws of the State of
New York, 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
subordinated debentures, notes or other evidences of indebtedness (herein called
the "Securities"), to be issued in one or more series as in this Indenture
provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually 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 1.1 DEFINITIONS.
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(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
<PAGE>
(4) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
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 1.4.
"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.
"Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 6.14 to act on behalf of the Trustee to authenticate Securities of
one or more series.
"Authorized Newspaper" means a newspaper, in the English language or in an
official language of the country of publication, customarily published on each
Business Day, whether or not published on Saturdays, Sundays or holidays, and of
general circulation in the place, in connection with which the term is used, or
in the financial community of such place. Where successive publica- tions are
required to be made in Authorized Newspapers, the successive publications may be
made in the same or in different newspapers in the same city meeting the
foregoing requirements and in each case on any Business Day.
"Bearer Security" means any Security in the form set forth in either
Exhibit C or Exhibit D to this Indenture or established pursuant to Section 2.1
which is payable to bearer.
"Board of Directors" means either the board of directors of the Company or
any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company to have been duly adopted by the Board
of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Book-Entry Security" means a Security bearing the legend specified in
Section 2.4, 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 2.1 and 2.3 and Article III
of the Indenture.
2
<PAGE>
"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.
"Change in Control" shall mean a change in control of the Company which
shall be deemed to have occurred at such time or times as (l) the Company
determines that any Person or related group of persons is the beneficial owner,
directly or indirectly, of 20% or more of the outstanding Common Stock of the
Company or (2) individuals who constitute the Continuing Directors cease for any
reason to constitute at least a majority of the board of directors of the
Company.
"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.
"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, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Continuing Director" means an individual who is a member of the Board of
Directors of the Company on the date of this Indenture or who shall have become
a member of the Board of Directors of the Company subsequent to such date and
who shall have been nominated or elected by a majority of the other Continuing
Directors then members of the Board of Directors of the Company.
"Corporate Trust Office" means the principal office of the Trustee in New
York, New York 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.
"Coupon" means any interest coupon appertaining to a Bearer Security.
3
<PAGE>
"Defaulted Interest" has the meaning specified in Section 3.7.
"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 3.1."
"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 5.1.
"Exchange Date" has the meaning specified in Section 3.4.
"Exercise Period" means the period commencing with the day notice is first
given to Holders by the Company pursuant to Section 14.3 of a Change in Control
and ending with the day twenty days thereafter, excluding the day such notice is
first given and including such twentieth day.
"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 and in the case of a Bearer Security the bearer thereof and,
when used with respect to any coupon, means the bearer thereof.
"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 3.1.
"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.
"Junior Subordinated Payment" has the meaning specified in Section 16.2.
"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, the Vice Chairman of the Board, the President or a Vice President, and by
the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
4
<PAGE>
Secretary, of the Company, and delivered to the Trustee. One of the Officers
signing an Officers' Certificate given pursuant to Section 10.9 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 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 5.2.
"Outstanding", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(i) Securities theretofore 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 and any coupons 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 3.6 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or whether a
quorum is present at a meeting of Holders of Securities (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 5.2, (ii) the principal amount of a Security denominated in
a foreign currency or currencies shall be the U.S. dollar equivalent, determined
on the date of original issuance of such Security, of the principal amount (or,
in the case of an Original Issue Discount Security, the U.S. dollar equivalent
on the date of original issuance of such Security of the amount determined as
provided in (i) above) of such Security, and (iii) 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
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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, or upon any such determination as to the
presence of a quorum, 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 10.2, the
principal of and any premium and interest on the Securities of that series are
payable as specified as contemplated by Section 3.1.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 3.6 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security or a Security to which a
mutilated, destroyed, lost or stolen coupon appertains shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security or
the Security to which the mutilated, destroyed, lost or stolen coupon
appertains, as the case may be.
"Proceeding" has the meaning specified in Section 16.2.
"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 2.1
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 3.1, whether or not such day is a Business
Day.
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"Responsible Officer", when used with respect to the Trustee, means the
chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
or any assistant controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"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 3.5.
"Senior Indebtedness" means all amounts due on any obligations in
connection with any of the following, whether outstanding at the date of
execution of the Indenture or thereafter incurred or created: (a) indebtedness,
obligations and other liabilities (contingent or otherwise) of the Company for
money borrowed, or evidenced by bonds, debentures, notes or similar instruments;
(b) reimbursement obligations and other liabilities (contingent or otherwise) of
the Company with respect to letters of credit, bankers' acceptances issued for
the account of the Company or with respect to interest rate protection
agreements or currency exchange or purchase agreements; (c) obligations and
liabilities (contingent or otherwise) in respect of leases by the Company as
lessee which, in conformity with generally accepted accounting principles, are
accounted for as capitalized lease obligations on the balance sheet of the
Company; (d) all direct or indirect guarantees or similar agreements in respect
of, and obligations or liabilities (contingent or otherwise) to purchase or
otherwise acquire or otherwise to assure a creditor against loss of the Company
in respect of, indebtedness, obligations or liabilities of another Person
described in clauses (a) through (c); (e) any indebtedness described in clauses
(a) through (d) secured by any mortgage, pledge, lien or other encumbrance
existing on property which is owned or held by the Company, regardless of
whether the indebtedness secured thereby shall have been assumed by the Company;
and (f) any and all deferrals, renewals, extensions and refundings of, or
amendments, modifications or supplements to, any indebtedness, obligation or
liability of the kind described in clauses (a) through (e); unless in any case
in the instrument creating or evidencing such indebtedness, obligation,
liability, guaranty, assumption, deferral, renewal, extension or refunding, it
is provided that such indebtedness, obligation, liability, guaranty, assumption,
deferral, renewal, extension or refunding involved is not senior in right of
payment to the Securities or that such indebtedness is pari passu with or junior
to the Securities.
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"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 3.7.
"Stated Maturity," when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security or a coupon representing such installment of interest as the
fixed date on which the principal of such Security or such installment of
principal or interest is due and payable.
"Subsidiary" 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.
"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
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(as defined in Section 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.
"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 1.2 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 by or on behalf of the Company with respect to
compliance with a condition or covenant provided for in this Indenture except
for certificates provided for in Section 10.9 shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
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(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 1.3 FORM OF DOCUMENTS DELIVERED TO TRUSTEE.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations 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 1.4 ACTS OF HOLDERS.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing. If Securities of a series are issuable as Bearer
Securities, 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 such series may, alternatively, be embodied in and evidenced
by the record of Holders of Securities of such series voting in favor thereof,
either in person or by proxies duly appointed in writing, at any meeting of
Holders of Securities of such series duly called and held in accordance with the
provisions of Article Thirteen, or a combination of such instruments and any
such record. Except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments or record or both are
delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments and any
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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 and so voting at any such meeting. 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 6.1) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section. The record of any
meeting of Holders of Securities shall be proved in the manner provided in
Section 13.6.
(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) The principal amount and serial numbers of Bearer Securities held by
any Person, and the date of holding the same, may be proved by the production of
such Bearer Securities or by a certificate executed, as depositary, by any trust
company, bank, banker or other depositary, wherever situated, if such
certificate shall be deemed by the Trustee to be satisfactory, showing that at
the date therein mentioned such Person had on deposit with such depositary, or
exhibited to it, the Bearer Securities therein described; or such facts may be
proved by the certificate or affidavit of the Person holding such Bearer
Securities, if such certificate or affidavit is deemed by the Trustee to be
satisfactory. The Trustee and the Company may assume that such ownership of any
Bearer Security continues until (1) another certificate or affidavit bearing a
later date issued in respect of the same Bearer Security is produced, or (2)
such Bearer Security is produced to the Trustee by some other Person, or (3)
such Bearer Security is surrendered in exchange for a Registered Security, or
(4) such Bearer Security is no longer Outstanding. The principal amount and
serial numbers of Bearer Securities held by any Person, and the date of holding
the same, may also be proved in any other manner which the Trustee deems
sufficient.
(e) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
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(f) 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 5.12 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;
provided, 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 ninetieth 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 (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 5.13 of the Indenture, (ii) consent
to any supplemental indenture in accordance with Section 9.2 of the
Indenture or (iii) waive any term, condition or provision of any covenant
in accordance with Section 10.10 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
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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 ninetieth 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.
(g) 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 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 Indenture
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 5.1, 5.2 or 5.12.
SECTION 1.5 NOTICES, ETC., TO TRUSTEE AND COMPANY.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, Attention: Corporate
Trust Administration, 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 Secretary, or
at any other address previously furnished in writing to the Trustee by the
Company.
SECTION 1.6 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:
(1) 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; and
(2) such notice shall be sufficiently given to Holders of Bearer
Securities if published in an Authorized Newspaper in The City of New York,
The City of London and in such other city or cities as may be specified in
such Securities on a Business Day at least twice, the first such
publication to be 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 or the sufficiency of any notice to Holders of
Bearer Securities given as provided herein.
In case by reason of the suspension of publication of any Authorized
Newspaper or Authorized Newspapers or by reason of any other cause it shall be
impracticable to publish any notice to Holders of Bearer Securities as provided
above, then such notification as shall be given with the approval of the Trustee
shall constitute sufficient notice to such Holders for every purpose hereunder.
Neither the failure to give notice by publication to Holders of Bearer
Securities as provided above, nor any defect in any notice so published, shall
affect the sufficiency of any notice to Holders of Registered Securities given
as provided herein.
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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 Secretary, or
at any other address previously furnished in writing to the Trustee by the
Company.
SECTION 1.6 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:
(1) 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; and
(2) such notice shall be sufficiently given to Holders of Bearer
Securities if published in an Authorized Newspaper in The City of New York,
The City of London and in such other city or cities as may be specified in
such Securities on a Business Day at least twice, the first such
publication to be 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 or the sufficiency of any notice to Holders of
Bearer Securities given as provided herein.
In case by reason of the suspension of publication of any Authorized
Newspaper or Authorized Newspapers or by reason of any other cause it shall be
impracticable to publish any notice to Holders of Bearer Securities as provided
above, then such notification as shall be given with the approval of the Trustee
shall constitute sufficient notice to such Holders for every purpose hereunder.
Neither the failure to give notice by publication to Holders of Bearer
Securities as provided above, nor any defect in any notice so published, shall
affect the sufficiency of any notice to Holders of Registered Securities given
as provided herein.
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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.
SECTION 1.7 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,
except that any published notice may be in an official language of the country
of publication.
SECTION 1.8 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 1.9 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 1.10 SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Indenture by the Company shall bind
its successors and assigns, whether so expressed or not.
SECTION 1.11 SEPARABILITY CLAUSE.
In case any provision in this Indenture or the Securities or coupons shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
SECTION 1.12 BENEFITS OF INDENTURE.
Nothing in this Indenture or the Securities or coupons, express or implied,
shall give to any Person, other than the parties hereto, their successors
hereunder and the Holders of Securities and coupons, any benefit or any legal or
equitable right, remedy or claim under this Indenture.
SECTION 1.13 GOVERNING LAW.
This Indenture and the Securities and coupons 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 1.14 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
or coupons 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 2.1 FORMS GENERALLY.
The Registered Securities, if any, of each series and the Bearer Securi-
ties, if any, of each series and related coupons shall be in substantially the
forms set forth in Exhibits A, B, C or D to this Indenture, or in such other
form (including temporary or permanent global form) as shall be established by
or pursuant to a Board Resolution or in one or more indentures supplemental
hereto, in each case with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture, and may
have such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities or coupons, as evidenced by their execution
of the Securities or coupons. If temporary Securities of any series are issued
in global form as permitted by Section 3.4, the form thereof shall be
established as provided in the preceding sentence. If the forms of Securities or
coupons of any series (or any such temporary global Security) are established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 3.3 for the authentication and delivery of such
Securities (or any such temporary global Security) or coupons.
Unless otherwise specified as contemplated by Section 3.1, Securities in
bearer form shall have interest coupons attached.
The definitive Securities and coupons, if any, shall be printed, litho-
graphed or engraved on steel engraved borders or may be produced in any other
manner, all as determined by the officers executing such Securities or coupons,
as evidenced by their execution of such Securities or coupons.
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SECTION 2.2 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.
Dated: _____ The Bank of New York
as Trustee
By
------------------------------------
Authorized Signatory
SECTION 2.3 SECURITIES IN GLOBAL FORM.
If Securities of a series are issuable in global form, as specified as
contemplated by Section 3.1, then, notwithstanding clause (11) of Section 3.1
and the provisions of Section 3.2, any such Security shall represent such of the
Outstanding Securities of such series as shall be specified therein and may
provide that it shall represent the aggregate amount of Outstanding Securities
from time to time endorsed thereon and that the aggregate amount of Outstanding
Securities represented thereby may from time to time be reduced to reflect
exchanges. Any endorsement of a Security in global form to reflect the amount,
or any increase or decrease in the amount, of Outstanding Securities represented
thereby shall be made by the Trustee in such manner and upon instructions given
by such Person or Persons as shall be specified therein or in the Company Order
to be delivered to the Trustee pursuant to Section 3.3 or Section 3.4. Subject
to the provisions of Section 3.3 and, if applicable, Section 3.4, the Trustee
shall deliver and redeliver any Security in 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 3.3 or 3.4 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 1.2 and need not be
accompanied by an Opinion of Counsel.
The provisions of the last sentence of Section 3.3 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 1.2 and need not be accompanied by an Opinion of Counsel)
with regard to the reduction in the principal amount of Securities represented
thereby, together with the written statement contemplated by the last sentence
of Section 3.3.
Notwithstanding the provisions of Sections 2.1 and 3.7, unless otherwise
specified as contemplated by Section 3.1, payment of principal of and any
premium and interest on any Security in permanent global form shall be made to
the Person or Persons specified therein.
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Notwithstanding the provisions of Section 3.8 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
or, in the case of a permanent global Security in bearer form, of Euro-clear or
CEDEL S.A. which is provided to the Trustee by such Person.
SECTION 2.4 FORM OF LEGEND FOR BOOK-ENTRY SECURITIES.
Any Book-Entry Security authenticated and delivered hereunder shall bear a
legend in substantially the following form:
"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 2.5 FORM OF CONVERSION NOTICE.
The form of Conversion Notice for the Conversion of Securities into shares
of Common Stock or other securities of the Company shall be in substantially the
form included with the applicable form of Securities as set forth within
Exhibits A, B, C and D hereto.
ARTICLE III
THE SECURITIES
SECTION 3.1 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 Resolution and, subject to Section 3.3,
set forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series:
(1) the title of the Securities of the series (which shall distinguish
the Securities of the series from all other Securities);
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(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 3.4, 3.5, 3.6, 9.6 or 11.7 and except for any
Securities which, pursuant to Section 3.3, are deemed never to have been
authenticated and delivered hereunder);
(3) whether Securities of the series are to be issuable as Registered
Securities, Bearer Securities or both, 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 with
or without coupons 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 3.5;
(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, the manner in
which, or the Person to whom, any interest on any Bearer Security of the
series shall be payable, if otherwise than upon presentation and surrender
of the coupons appertaining thereto as they severally mature, 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 3.4;
(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, 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
11.4 and 10.2, the principal of and any premium and interest on Securities
of the series shall be payable, any Registered Securities of the series,
may be surrendered for registration of transfer, Securities of the series
may be surrendered for exchange, notices and demands to or upon the Company
in respect of the Securities of the series and this Indenture may be served
and
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where notices to Holders of Bearer Securities pursuant to Section 1.6 will
be published;
(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 XIV, 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 XIV, 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;
(11) the terms of any right to convert or exchange Securities of the
series, either at the option of the Holder thereof or the Company, into or
for shares of Common Stock of the Company or other securities or property,
including without limitation the period or periods within which and the
price or prices (including adjustments thereto) at which any Securities of
the series shall be converted or exchanged, in whole or in part;
(12) 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, and the denomination or denominations in which
any Bearer Securities of the series shall be issuable, if other than the
denomination of $5,000;
(13) the currency or currencies, including composite currencies, in
which payment of the principal of and any premium and interest on the
Securities of the series shall be payable if other than the currency of the
United States of America;
(14) if the principal of and any premium or interest on the Securities
of the series are to be payable, at the election of the Company or a Holder
thereof, in a currency or currencies, including composite currencies, other
than that or those in which the Securities are stated to be payable, the
currency or currencies in which payment of the principal of and any premium
and interest on Securities of such series as to which such election is made
shall
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be payable, and the periods within which and the terms and conditions upon
which such election is to be made;
(15) if the amount of payments of principal of and any premium or
interest on the Securities of the series may be determined with reference
to an index, the manner in which such amounts shall be determined:
(16) 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 5.2;
(17) the Person who shall be the Security Registrar, if other than the
Company;
(18) 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 3.5;
(19) if either or both of the provisions of Section 13.2 or 13.3 are
applicable to the Securities of such series; and
(20) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture).
Except as otherwise specified herein, the Securities shall be subordinated
and subject in right of payment to the prior terms of the Senior Indebtedness as
provided in Article XVI.
All Securities of any one series and the coupons appertaining to any Bearer
Securities of such 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 Resolution referred to above and (subject
to Section 3.3) 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 Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
SECTION 3.2 DENOMINATIONS.
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Unless otherwise provided as contemplated by Section 3.1 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 and any
Bearer Securities of a series shall be issuable in the denomination of $5,000.
SECTION 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
The Securities shall be executed on behalf of the Company by its Chairman
of the Board, its Vice Chairman of the Board, its President or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile. Coupons shall bear the
facsimile signature of the Treasurer or any Assistant Treasurer of the Company.
Securities and coupons 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, together with any
coupons appertaining thereto. executed by the Company to the Trustee for
authentication, together with a Company Order for the authentication and
delivery of such Securities, and the Trustee in accordance with the Company
Order shall authenticate and deliver such Securities; PROVIDED, HOWEVER, that,
in connection with its original issuance, no Bearer Security shall be mailed or
otherwise delivered to any location in the United States; and PROVIDED, FURTHER,
that a Bearer Security may be delivered in connection with its original issuance
only if the Person entitled to receive such Bearer Security shall have furnished
a certificate in the form set forth in Exhibit E.1 to this Indenture, dated no
earlier than 15 days prior to the earlier of the date on which such Bearer
Security is delivered and the date on which any temporary global Security first
becomes exchangeable for such Bearer Security in accordance with the terms of
such temporary global Security and this Indenture. If any Security shall be
represented by a permanent global Bearer Security, then, for purposes of this
Section and Section 3.4, the notation of a beneficial owner's interest therein
upon original issuance of such Security or upon exchange of a portion of a
temporary global Security shall be deemed to be delivered in connection with its
original issuance of such beneficial owner's interest in such permanent global
Security. Except as permitted by Section 3.6, the Trustee shall not authenticate
and deliver any Bearer Security unless all appurtenant coupons for interest then
matured have been detached and cancelled.
If the forms or terms of the Securities of the series and any related
coupons have been established in or pursuant to one or more Board Resolutions as
permitted by Sections 2.1 and 3.1, in authenticating such Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive, and (subject to
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Section 6.1) shall be fully protected in relying upon, an Opinion of Counsel
stating:
(a) if the forms of such Securities and any coupons have been
established by or pursuant to Board Resolution as permitted by Section 2.1,
that such forms have been established in conformity with the provisions of
this Indenture;
(b) if the terms of such Securities and any coupons have been
established by or pursuant to Board Resolution as permitted by Section 3.1,
that such terms have been established in conformity with the provisions of
this Indenture; and
(c) that such Securities, together with any coupons appertaining
thereto, when authenticated and delivered by the Trustee and issued by the
Company in the manner and subject to any conditions specified in such
Opinion of Counsel, will constitute valid and legally binding obligations
of the Company, enforceable in accordance with their terms, subject, 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 3.1 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 3.1 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; and
each Bearer Security shall be dated as of the date of original issuance of the
first Security of such series to be issued.
No Security or coupon shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Security,
or the Security to which such coupon appertains, a certificate of authentication
substantially in the form provided for herein executed by the Trustee by manual
signature, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder. Notwithstanding the foregoing, if any Security shall have
been authenticated and delivered hereunder but never issued and sold by the
Company, and the Company shall deliver such Security to the Trustee for
cancellation as provided in Section 3.9 together with a
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written statement (which need not comply with Section 1.2 and need not be
accompanied by an Opinion of Counsel) stating that such Security has never been
issued and sold by the Company, for all purposes of this Indenture such Security
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits of this Indenture.
SECTION 3.4 TEMPORARY SECURITIES.
Pending the preparation of definitive Securities of any series, the Company
may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities 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 or, if authorized, in bearer form with one or more coupons or
without coupons, and with such appropriate insertions, omissions, substitutions
and other variations as the officers executing such Securities or coupons may
determine, as evidenced by their execution of such Securities or coupons. In the
case of any series issuable as Bearer Securities, such temporary Securities may
be in global form. A temporary Bearer Security shall be delivered only in
compliance with the conditions set forth in Section 3.3.
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 10.2 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 (accompanied by any unmatured coupons appertaining
thereto) the Company 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;
PROVIDED, HOWEVER, that no definitive Bearer Security shall be delivered in
exchange for a temporary Registered Security.
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 depositary or common depositary (the "Common
Depositary"), 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
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the Company. On or after the Exchange Date such temporary global Security shall
be surrendered by the Common Depositary 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 Depositary, 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 E.2 to this Indenture. The definitive Securities to be
delivered in exchange for any such temporary global Security shall be in bearer
form, registered form, permanent global bearer form or permanent global
registered form, or any combination thereof, as specified as contemplated by
Section 3.1, and, if any combination thereof is so specified, as requested by
the beneficial owner thereof; provided, however, that definitive Bearer
Securities shall be delivered in exchange for a portion of a temporary global
Security only in compliance with the requirements of Section 3.3.
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 his behalf and
delivers to Euro-clear or CEDEL S.A., as the case may be, a certificate in the
form set forth in Exhibit E.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. Definitive Securities in bearer form to be delivered in
exchange for any portion of a temporary global Security shall be delivered only
outside the United States.
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
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CEDEL S.A. to the Trustee of a certificate or certificates in the form set forth
in Exhibit E.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 E.4 to this
Indenture. Any interest so received by Euro-clear and CEDEL S.A. and not paid as
herein provided shall be 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 10.3.
SECTION 3.5 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 10.2 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 10.2 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 Securities
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. Registered Securities may not be exchanged
for Bearer Securities.
At the option of the Holder, Bearer Securities of any series may be
exchanged for Registered Securities of the same series of any authorized
denominations and of a like aggregate principal amount and tenor, upon surrender
of the Bearer Securities to be exchanged at any such office or agency, with all
unmatured coupons, and all matured coupons in default appertaining thereto. If
the Holder of a Bearer Security is unable to produce any such unmatured coupon
or coupons or matured coupon or coupons in default, such exchange may be
effected if the Bearer Securities are accompanied by payment in funds acceptable
to the Company in an amount equal to the face amount of such missing coupon or
coupons, or the surrender of such missing
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coupon or coupons may be waived by the Company and the Trustee if there is
furnished to them such security or indemnity as they may required to save each
of them and any Paying Agent harmless. If thereafter the Holder of such
Securities shall surrender to any Paying Agent any such missing coupon in
respect of which such a payment shall have been made, such Holder shall be
entitled to receive the amount of such payment; PROVIDED, HOWEVER, that, except
as otherwise provided in Section 10.2, interest represented by coupons shall be
payable only upon presentation and surrender of those coupons at an office or
agency located outside the United States. Notwithstanding the foregoing, in case
a Bearer Security of any series is surrendered at any such office or agency in
exchange for a Registered Security of the same series and like tenor after the
close of business at such office or agency on (i) any Regular Record Date and
before the opening of business at such office or agency on the relevant Interest
Payment Date, or (ii) any Special Record Date and before the opening of business
at such office or agency on the related proposed date for payment of Defaulted
Interest, such Bearer Security shall be surrendered without the coupon relating
to such Interest Payment Date or proposed date for payment, as the case may be,
and interest or Defaulted Interest, as the case may be, will not be payable on
such Interest Payment Date or proposed date for payment, as the case may be, in
respect of the Registered Security issued in exchange for such Bearer Security,
but will be payable only to the Holder of such coupon when due in accordance
with the provisions of this Indenture.
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 3.1, any permanent global Security shall be exchangeable
only as provided in 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 3.1, 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 Depositary or such
other depositary or Common Depositary 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 which, unless the Securities of the series are not issuable both
as Bearer Securities and as Registered Securities, as specified as contemplated
by Section 3.1, shall be in the form of Bearer Securities or Registered
Securities, or any combination thereof, as
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shall be specified by the beneficial owner thereof; PROVIDED, HOWEVER, that no
Bearer Security delivered in exchange for a portion of a permanent global
Security shall be mailed or otherwise delivered to any location in the United
States. If a Registered Security is issued in exchange 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 Defaulted Interest,
interest or Defaulted Interest, as the case may be, 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 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 3.4, 9.6 or 11.7 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 (A) if Securities of the series
are issuable only as Registered Securities, the day of the mailing of the
relevant notice of redemption and (B) if Securities of the series are issuable
as Bearer Securities, the day of the first publication of the relevant notice of
redemption or, if Securities of the series are also issuable as Registered
Securities and there is no publication, the mailing of the relevant notice of
redemption, (ii) to register the transfer of or exchange any Registered Security
so selected for redemption, in whole or in part, except the unredeemed portion
of any Security being redeemed in part, or (iii) to exchange any Bearer Security
so selected for redemption except that such a Bearer Security may be exchanged
for a Registered Security of that
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series and like tenor, PROVIDED that such Registered Security shall be
simultaneously surrendered for redemption.
Notwithstanding the foregoing and except as otherwise specified or
contemplated by Section 3.1, any Book-Entry Security shall be exchangeable
pursuant to this Section 3.5 or Sections 3.4, 9.6 and 11.7 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 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 3.1 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 2.4
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 3.6 MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES AND COUPONS.
If any mutilated Security or a Security with a mutilated coupon
appertaining thereto 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, with coupons corresponding to the
coupons, if any, appertaining to the surrendered Security and such mutilated
Security or a Security with a mutilated coupon, if any, 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 or coupon
and (ii) such security or indemnity as may be required by them, then, in the
absence of notice to the Company or the Trustee that such Security or coupon has
been acquired by a bona fide purchaser, the Company shall, subject to the
following paragraph, execute, and the Trustee shall authenticate and deliver, in
lieu of any such destroyed, lost or stolen Security or in exchange for the
Security to which a destroyed, lost or stolen coupon appertains (with all
appurtenant coupons not destroyed, lost or stolen), a new Security of the
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same series and of like tenor and principal amount and bearing a number not
contemporaneously outstanding, with coupons corresponding to the coupons, if
any, appertaining to such destroyed, lost or stolen Security or to the Security
to which such destroyed, lost or stolen coupon appertains.
In case any such mutilated, destroyed, lost or stolen Security or coupon
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security or coupon; PROVIDED,
HOWEVER, that principal of and any premium and interest on Bearer Securities
shall, except as otherwise provided in Section 10.2, be payable only at an
office or agency located outside the United States.
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, with any coupons appertaining thereto,
issued pursuant to this Section in lieu of any destroyed, lost or stolen
Security or in exchange for a Security to which a destroyed, lost or stolen
coupon appertains, shall constitute an original additional contractual
obligation of the Company, whether or not the destroyed, lost or stolen Security
and any coupons appertaining thereto, or the destroyed, lost or stolen coupon
shall be at any time enforceable by anyone, and any such new Security and
coupons, if any, shall be entitled to all the benefits of this Indenture equally
and proportionately with any and all other Securities of that series and their
coupons, if any, duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities or coupons.
SECTION 3.7 PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Unless otherwise provided as contemplated by Section 3.1 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:
(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
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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 arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited to be
held in trust for the benefit of the Persons entitled to such Defaulted
Interest as in this Clause provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest which shall
be not more than 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
(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 3.5, 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.
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SECTION 3.8 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 3.5 and 3.7) 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.
Title to any Bearer Security and any coupons appertaining thereto shall
pass by delivery. The Company, the Trustee and any agent of the Company or the
Trustee may treat the bearer of any Bearer Security and the Bearer of any coupon
as the owner of such Security or coupon for the purpose of receiving payment
thereof or on account thereof and for all other purposes whatsoever, whether or
not such Security or coupon 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 3.9 CANCELLATION.
All Securities and coupons 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 and matured coupons so delivered shall
be promptly cancelled by the Trustee. All Bearer Securities and unmatured
coupons so delivered shall be cancelled. All Bearer Securities and unmatured
coupons held by the Trustee pending such cancellation or reissuance shall be
deemed to be delivered for cancellation for all purposes of this Indenture and
the Securities. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and may deliver to
the Trustee (or to any other Person for delivery to the Trustee) for
cancellation any Securities previously authenticated hereunder which the Company
has not issued and sold, and all Securities so delivered shall be promptly
cancelled by the Trustee. No Securities shall be authenticated in lieu of or in
exchange for any Securities cancelled as provided in this Section, except as
expressly permitted by this Indenture. All cancelled Securities and coupons 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
Depositary (or its nominee) as Holder of such Book-Entry Security.
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SECTION 3.10 COMPUTATION OF INTEREST.
Except as otherwise specified as contemplated by Section 3.1 for Securities
of any series, interest on the Securities of each series shall be computed on
the basis of a 360-day year of twelve 30-day months.
SECTION 3.11 ELECTRONIC SECURITY ISSUANCE.
The Securities may pursuant to a Board Resolution and Officers' Certificate
complying with Section 3.1 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 Resolution and Officers'
Certificate. Nothing in this Section 3.11 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 4.1 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 10.4), 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 and
all coupons, if any, appertaining thereto (other than (i) coupons
appertaining to Bearer Securities surrendered for exchange for
Registered Securities and maturing after such exchange, whose
surrender is not required or has been waived as provided in Section
3.5, (ii) Securities and coupons which have been destroyed, lost or
stolen and which have been replaced or paid as provided in Section
3.6, (iii) coupons appertaining to Securities called for redemption
and maturing after the relevant Redemption Date, whose surrender has
been waived as provided in Section 11.6, and (iv) Securities and
coupons for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged
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from such trust, as provided in Section 10.3) have been delivered to
the Trustee for cancellation; or
(B) all such Securities and, in the case of (i) or (ii) below,
any coupons appertaining thereto not theretofore delivered to the
Trustee for cancellation,
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of
the Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the purpose,
an amount sufficient to pay and discharge the entire indebtedness on such
Securities and coupons 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 6.7, the obligations of
the Trustee to any Authenticating Agent under Section 6.14 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 4.2 and the last paragraph of
Section 10.3 shall survive.
SECTION 4.2 APPLICATION OF TRUST MONEY.
Subject to the provisions of the last paragraph of Section 10.3, all money
deposited with the Trustee pursuant to Section 4.1 shall be held in trust and
applied by it, in accordance with the provisions of the Securities, the coupons
and this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and any interest for whose payment such money has been deposited with the
Trustee.
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SECTION 4.3 SATISFACTION, DISCHARGE AND DEFEASANCE OF SECURITIES OF ANY SERIES.
If this Section 4.3 is specified, as contemplated by Section 3.1, to be
applicable to Securities of any series, then notwithstanding Section 4.1: (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 3.4,
3.5, 3.6, 10.2, 10.3, and 10.4 and the rights, powers, trusts, duties and
immunities of the Trustee hereunder, including those under Section 6.7 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 4.3, the Company has deposited or
caused to be deposited with the Trustee irrevocably (but subject to
the provisions of Section 4.2 and the last paragraph of Section 10.3),
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 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 (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
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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
3.1, 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 5.1(6) or
Section 5.1(7) or event which with the giving of notice or lapse of time,
or both, would become an Event of Default under Section 5.1(6) or Section
5.1(7) shall have occurred and be continuing on the 91st day after such
date;
(5) at the time of such deposit: (A) no default in the payment of
principal of (or premium, if any) or interest on any Senior Indebtedness
shall have occurred and be continuing or (B) no other event of default with
respect to any Senior Indebtedness shall have occurred and be continuing
and shall have resulted in such Senior Indebtedness becoming or being
declared due and payable prior to the date on which it would otherwise
become due and payable, or, in the case of either clause (A) or clause (B)
above, each such default shall have been cured or waived or shall have
ceased to exist;
(6) 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;
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(7) 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
(8) 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 4.3, 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 4.3(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 Outstanding 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 4.3 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 not to be Outstanding under clause (iii) of the definition thereof if
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
4.3) of the Company under this Indenture with respect to any series of
Securities, the obligations of the Company to the Trustee under Section 6.7, and
the obligations of the Trustee under Section 4.2 and the last paragraph of
Section 10.3 shall survive with respect to such series of Securities.
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ARTICLE V
REMEDIES
SECTION 5.1 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):
(1) default in the payment of any interest upon any Security of that
series when it becomes due and payable, and continuance of such default for
a period of 30 days; or
(2) default in the payment of the principal of (or premium, if any,
on) any Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty a
default in whose performance or whose breach is elsewhere in this Section
specifically dealt with or which has expressly been included in this
Indenture solely for the benefit of series of Securities other than that
series), and continuance of such default or breach for a period of 60 days
after there has been given, by registered or certified mail, to the Company
by the Trustee or to the Company and the Trustee by the Holders of at least
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
(5) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in
respect of the Company 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
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(6) 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
(7) any other Event of Default provided with respect to Securities of
that series.
SECTION 5.2 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.
If an Event of Default with respect to Securities of any series at the time
Outstanding occurs and is continuing, then in every such case the Trustee or the
Holders of not less than 25% in principal amount of the Outstanding Securities
of that series may declare the principal amount (or, if any 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,
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(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
(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 5.13. No such rescission shall
affect any subsequent default or impair any right consequent thereon.
SECTION 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE.
The Company covenants that if,
(1) default is made in the payment of any interest on any Security 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 and any coupons appertaining thereto,
the whole amount then due and payable on such Securities of that series and
coupons 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
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prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon such Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon such Securities, wherever
situated.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series and any
coupons appertaining thereto by such appropriate judicial proceedings as the
Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy.
SECTION 5.4 TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial 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 and
coupons allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same, and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities and coupons 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 and coupons, to pay to the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 6.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a Security
or coupon any plan of reorganization, arrangement, adjustment or
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composition affecting the Securities or coupons 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 or coupon in any such proceeding.
SECTION 5.5 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF SECURITIES OR
COUPONS.
All rights of action and claims under this Indenture or the Securities or
coupons may be prosecuted and enforced by the Trustee without the possession of
any of the Securities or coupons 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 and coupons in respect
of which such judgment has been recovered.
SECTION 5.6 APPLICATION OF MONEY COLLECTED.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or any premium
or interest, upon presentation of the Securities or coupons, or both, as the
case may be, and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
6.7; and
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities and coupons 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 and coupons for principal and
any premium and interest, respectively.
SECTION 5.7 LIMITATION ON SUITS.
No Holder of any Security of any series or any related coupons shall have
any right to institute any proceeding, judicial or otherwise, with respect to
this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless;
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
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(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
SECTION 5.8 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM AND
INTEREST.
Notwithstanding any other provision in this Indenture, the Holder of any
Security or coupon shall have the right, which is absolute and unconditional, to
receive payment of the principal of and any premium and (subject to Section 3.7)
interest on such Security or payment of such coupon on the Stated Maturity or
Maturities expressed in such Security or coupon (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 5.9 RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder of a Security or coupon 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 and coupons shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 5.10 RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities or coupons in the last paragraph
of Section 3.6, no right or remedy herein conferred upon or reserved
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to the Trustee or to the Holders of Securities or coupons is intended to be
exclusive or any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 5.11 DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee or of any Holder of any Security or
coupon 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 or coupons may be
exercised from time to time, and as often as may be deemed expedient, by the
Trustee or by the Holders of Securities or coupons, as the case may be.
SECTION 5.12 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.
SECTION 5.13 WAIVER OF PAST DEFAULTS.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series and any coupons appertaining thereto waive any past
default hereunder with respect to the Securities of such series and its
consequences, except a default,
(1) in the payment of the principal of (or premium, if any) or any
interest on any Security of such series, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security of such series affected. Upon any such waiver,
such default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
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SECTION 5.14 UNDERTAKING FOR COSTS.
All parties to this Indenture agree, and each Holder of any Security or
coupon by his acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in principal
amount of the Outstanding Securities of any series, or to any suit instituted by
any Holder of any Security or coupon for the enforcement of the payment of the
principal of or any premium or interest on any Security or the payment of any
coupon on or after the Stated Maturity or Maturities expressed in such Security
or coupon (or, in the case of redemption, on or after the Redemption Date).
SECTION 5.15 WAIVER OF STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE VI
THE TRUSTEE
SECTION 6.1 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;
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(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 resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall deem
it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely upon
an Officers' Certificate;
(d) the Trustee may consult with counsel and the 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 or any related coupons pursuant to this
Indenture, unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, 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 6.2 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Securities (except the Trustees
certificates of authentication) and in any coupons 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 or
coupons. The Trustee or any Authenticating Agent shall not be accountable for
the use or application by the Company of Securities or the proceeds thereof.
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SECTION 6.3 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 coupons and, subject
to Sections 6.8 and 6.13, 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.
SECTION 6.4 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 6.5 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.
SECTION 6.6 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 6.11 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of
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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 3.10(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 Resolution may remove the
Trustee with respect to all Securities, or (ii) subject to Section 5.14 any
Holder of a Security who has been a bona fide Holder of a Security for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the removal of the Trustee with respect
to all Securities and the appointment of a successor Trustee or Trustees.
(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 Resolution,
shall promptly appoint a successor Trustee or Trustees with respect to the
Securities of that or those series (it being understood that any such successor
Trustee may be appointed with respect to the Securities of one or more or all of
such series and that at any time there shall be only one Trustee with respect to
the Securities of any particular series) and shall comply with the applicable
requirements of Section 6.11. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of Outstanding Securities of such
series delivered to the Company and the retiring Trustee, the successor Trustee
so appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 6.11, become the
successor Trustee with respect to the Securities of such series and to that
extent supersede the successor Trustee appointed by
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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 6.11,
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 1.6. Each notice shall include the name of the successor
Trustee with respect to the Securities of such series and the address of its
Corporate Trust Office.
SECTION 6.7 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 supplemental 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
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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.
SECTION 6.8 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 6.9 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 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 6.10 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).
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SECTION 6.11 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
SECTION 6.12 APPOINTMENT OF AUTHENTICATING AGENT.
The Trustee may appoint an Authenticating Agent or Agents with respect to
one or more series of Securities which shall be authorized to act on behalf of
the Trustee to authenticate Securities of such series issued upon original issue
or upon exchange, registration of transfer or partial redemption thereof or
pursuant to Section 3.6, 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. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Authenticating Agent shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section, such Authenticating
Agent shall resign immediately in the manner and with the effect specified in
this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of 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
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terminate the 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 1.6. 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 6.7.
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.
The Bank of New York
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 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 1.2 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.
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ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 7.1 PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders of Securities (i) contained in
the most recent list furnished to the Trustee as provided in Section 7.1, (ii)
received by the Trustee in its capacity as Security Registrar and (iii) filed
with it within the two preceding years pursuant to Section 7.3(c)(2). The
Trustee may (i) destroy any list furnished to it as provided in Section 7.1 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 20 or September 20 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, (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 and (iv) destroy not earlier than two years after filing, any
information filed with it pursuant to Section 7.3(c)(2).
(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
Securities 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 elec-
tion, either
(i) afford such applicants access to the information preserved at the
time by the Trustee in accordance with Section 7.2(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 7.2(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 Holder of Securities whose name and address appears in the
information preserved at the time by the Trustee in accordance with Section
7.2(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
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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 statement 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 or coupons, 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 7.2(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 7.2(b).
SECTION 7.2 REPORTS BY TRUSTEE.
The Trustee shall transmit to Holders such reports concerning the Trustee
and its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto.
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when any Securities are listed on any stock exchange.
ARTICLE VIII
CONSOLIDATION, MERGER,
SALE, LEASE, TRANSFER
OR OTHER DISPOSITION
SECTION 8.1 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
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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
10.4) on all the Securities and the performance 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 consolidation, 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 8.2 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 8.1, the
successor Person formed by such consolidation or into which the Company is
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merged or to which sale, lease, transfer or other disposition is made shall
assume the obligations of the Company on the Securities and under this Indenture
with the same effect as if such successor Person had been named as the Company
herein, and thereafter, except in the case of a lease, the predecessor Person
shall be relieved of all obligations and covenants under this Indenture and the
Securities and coupons.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders of Securities or coupons, the Company is
then authorized by a Board Resolution, and the Trustee, at any time and from
time to time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company And
the assumption by any such successor of the covenants of the Company herein
and in the Securities; or
(2) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred upon the
Company; or
(3) to add any additional Events of Default; or
(4) to add to or change any of the provisions of this Indenture to
provide that Bearer Securities may be registerable as to principal to
change or eliminate any restrictions on the payment of principal of or any
premium or interest on Bearer Securities, to permit Bearer Securities to be
issued in exchange for Registered Securities, to permit Bearer Securities
to be issued in exchange for Bearer Securities of other authorized
denominations or to permit or facilitate the issuance of Securities in
uncertificated form, PROVIDED that any such action shall not adversely
affect the interests of the Holders of Securities of any series or any
related coupons in any material respect; or
(5) to 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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(6) to establish the form or terms of Securities of any series and any
related coupons as permitted by Sections 2.1 and 3.1; or
(7) 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 6.11(b); or
(8) to make provision with respect to the conversion rights of Holders
pursuant to the requirements of Article XV, including providing for the
conversion of the Securities into any security or property (other than the
Common Stock of the Company); or
(9) 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 or any related
coupons in any material respect.
SECTION 9.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than 66-2/3% in principal
amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series and any related coupons 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 10.4 (except as contemplated by
Section 8.1(1) and permitted by Section 9.1(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 5.2 or change the coin or currency in which any Security or any
premium or interest thereon is payable,
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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 modify the provisions of
the Indenture with respect to the subordination of the Securities in a
manner adverse to the Holders, 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 reduce the requirements of Section 13.4 for quorum or voting,
or
(3) change any obligation of the Company to maintain an office or
agency in the places and for the purposes specified in Section 10.2, or
(4) modify any of the provisions of this Section, Section 5.13 or
Section 10.10, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security affected
thereby; PROVIDED, HOWEVER, that this clause shall not be deemed to require
the consent of any Holder of a Security or coupon with respect to changes
in the references to "the Trustee" and concomitant changes in this Section
or the deletion of this proviso, in accordance with the requirements of
Sections 6.11(b) and 9.1(8), or
(5) make any change that adversely affects the right to convert any
Security as provided in Article XV or pursuant to Section 3.1 (except as
permitted by Section 9.1) or decrease the conversion rate or increase the
conversion price of any such Security.
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.
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.
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SECTION 9.3 EXECUTION OF SUPPLEMENTAL INDENTURES.
In executing or accepting the additional trusts created by any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 6.1) shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee 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 9.4 EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
and of any coupons appertaining thereto shall be bound thereby.
SECTION 9.5 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 9.6 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.
SECTION 9.7 SUBORDINATION UNIMPAIRED.
No provision in any supplemental indenture that effects the superior
position of the holders of Senior Indebtedness shall be effective against
holders of Senior Indebtedness.
ARTICLE X
COVENANTS
SECTION 10.1 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
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premium and interest on the Securities of that series in accordance with the
terms of the Securities, any coupons appertaining thereto and this Indenture.
Unless otherwise specified as contemplated by Section 3.1 with respect to any
series of Securities, any interest due on Bearer Securities on or before
Maturity shall be payable only upon presentation and surrender outside the
United States of the several coupons for such interest installments as are
evidenced thereby as they severally mature.
SECTION 10.2 MAINTENANCE OF OFFICE OR AGENCY.
If Securities of a series are issuable only as Registered Securities, 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. If
Securities of a series are issuable as Bearer Securities, the Company will
maintain (A) in The City of New York, an office or agency where any Registered
Securities of that series may be presented or surrendered for payment, where any
Registered Securities of that series may be surrendered for registration of
transfer, where Securities of that series may be surrendered for exchange, where
notices and demands to or upon the Company in respect of the Securities of that
series and this Indenture may be served and where Bearer Securities of that
series and related coupons may be presented or surrendered for payment in the
circumstances described in the following paragraph (and not otherwise), (B)
subject to any laws or regulations applicable thereto, in a Place of Payment for
that series which is located outside the United States, an office or agency
where Securities of that series and related coupons may be presented and
surrendered for payment (including payment of any additional amounts payable on
Securities of that series pursuant to Section 10.4); PROVIDED, HOWEVER, that if
the Securities of that series are listed on The Stock Exchange of the United
Kingdom and the Republic of Ireland, the Luxembourg Stock Exchange or any other
stock exchange located outside the United States and such stock exchange shall
so require, the Company will maintain a Paying Agent for the Securities of that
series in London, Luxembourg or any other required city located outside the
United States, as the case may be, so long as the Securities of that series are
listed on such exchange, and (C) subject to any laws or regulations applicable
thereto in a Place of Payment for that series located outside the United States
an office or agency where any Registered Securities of that series may be
surrendered for registration of transfer, where Securities of that series may be
surrendered for exchange and where notices and demands to or upon the Company in
respect of the Securities of that series and this Indenture may be served. The
Company will give prompt notice to the Trustee and to the Holders as provided in
Sections 1.3 and 1.6, 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, except that Bearer Securities of that series and the related coupons
may be presented
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and surrendered for payment (including payment of any additional amounts payable
on Bearer Securities of that series pursuant to Section 10.4) at any Paying
Agent for such series located outside the United States, and the Company hereby
appoints the same as its agent to receive such respective presentations,
surrenders, notices and demands.
No payment of principal, premium or interest on Bearer Securities shall be
made at any office or agency of the Company in the United States or by check
mailed to any address in the United States or by transfer to any account
maintained with a bank located in the United States; PROVIDED, HOWEVER, that if
the Securities of a series are denominated and payable in Dollars, payment of
principal of and any premium and interest on any Bearer Security (including any
additional amounts payable on Securities of such series pursuant to Section
10.4) shall be made at the office of the Company's Paying Agent in The City of
New York, if (but only if) payment in Dollars of the full amount of such
principal, premium, interest or additional amounts, as the case may be, at all
offices or agencies outside the United States maintained for the purpose by the
Company in accordance with this Indenture is illegal or effectively precluded by
exchange controls or other similar restrictions.
The Company may also from time to time designate one or more other offices
or agencies where the Securities 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.
SECTION 10.3 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.
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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 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 or
any coupon appertaining thereto shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money and all liability
of the Company as trustee thereof shall thereupon cease; PROVIDED, HOWEVER, that
the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in an
Authorized Newspaper in each Place of Payment, notice that such money remains
unclaimed and that after a date specified therein, which shall not be less than
30 days from the date of such publication, any unclaimed balance of such money
then remaining will be repaid to the Company.
SECTION 10.4 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 or
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any coupon appertaining thereto 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 payment of any related coupon 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.
If the Securities of a series provide for the payment of additional
amounts, at least 10 days prior to the first Interest Payment Date with respect
to that series of Securities (or if the Securities of that series will not bear
interest prior to Maturity, the first day on which a payment of principal and
any premium is made), and at least 10 days prior to each date of payment of
principal and any premium or interest if there has been any change with respect
to the matters set forth in the below-mentioned Officers' Certificate, the
Company will furnish the Trustee and the Company's principal Paying Agent or
Paying Agents, if other than the Trustee, with an Officers' Certificate
instructing the Trustee and such Paying Agent or Paying Agents whether such
payment of principal of and any premium or interest on the Securities of that
series shall be made to Holders of Securities of that series or any related
coupons who are United States Aliens without withholding for or on account of
any tax assessment or other governmental charge described in the Securities of
that series. If any such withholding shall be required, then such Officers'
Certificate shall specify by country the amount, if any, required to be withheld
on such payments to such Holders of Securities or coupons and the Company will
pay to the Trustee or such Paying Agent the additional amounts required by this
Section. The Company covenants to indemnify the Trustee and any Paying Agent
for, and to hold them harmless against, any loss liability or expense reasonably
incurred without negligence or willful misconduct on their part arising out of
or in connection with actions taken or omitted by any of them in reliance on any
Officers' Certificate furnished pursuant to this Section.
SECTION 10.5 EXISTENCE.
Subject to Article VIII, 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 10.6 PURCHASE OF SECURITIES BY COMPANY OR SUBSIDIARY.
If and so long as the Securities of a series are listed on The Stock
Exchange of the United Kingdom and the Republic of Ireland and such stock
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exchange shall so require, the Company will not, and will not permit any of its
Subsidiaries to, purchase any Securities of that series by private treaty at a
price (exclusive of expenses and accrued interest) which exceeds 120% of the
mean of the nominal quotations of the Securities of that series as shown in The
Stock Exchange Daily Official List for the last trading day preceding the date
of purchase.
SECTION 10.7 STATEMENT BY OFFICERS AS TO DEFAULT.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officers'
Certificate stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of 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.
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 11.1 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 3.1 for Securities of any series) in
accordance with this Article.
SECTION 11.2 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, at
least 60 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date 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 11.3 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
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Trustee shall deem fair and appropriate and which may provide for the selection,
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.
If any Security selected for partial redemption is converted in part before
termination of the conversion right with respect to the portion of the Security
so selected, the converted portion of such Security shall be deemed (so far as
may be) to be the portion selected for redemption. Securities which have been
converted during a selection of Securities to be redeemed shall be treated by
the Trustee as Outstanding for the purpose of such selection. In any case where
more than one Security is registered in the same name, the Trustee in its
discretion may treat the aggregate principal amount so registered as if it were
represented by one Security.
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 11.4 NOTICE OF REDEMPTION.
Notice of redemption shall be given in the manner provided in Section 1.6
to the Holders of Securities to be redeemed not less than 30 nor more than 60
days prior to the Redemption Date.
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;
(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and,
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if applicable, that interest thereon will cease to accrue on and after said
date;
(5) the place or places where such Securities, together in the case of
Bearer Securities with all coupons appertaining thereto, if any maturing
after the Redemption Date, are to be surrendered for payment of the
Redemption Price; and
(6) that the redemption is for a sinking fund, if such is the case.
(7) if applicable, the conversion price, the date on which the right
to convert the Securities to be redeemed will terminate and the place or
places where such Securities may be surrendered for conversion. A notice of
redemption published as contemplated by Section 1.6 need not identify
particular Registered Securities to be redeemed.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
SECTION 11.5 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 10.3) 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 11.6 SECURITIES PAYABLE ON REDEMPTION DATE.
Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall on the Redemption Date become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest and the coupons for such
interest appertaining to any Bearer Securities so to be redeemed except to the
extent provided below, shall be void. Upon surrender of any such Security for
redemption in accordance with said notice together with all coupons, if any,
appertaining thereto maturing after the Redemption Date, such Security shall be
paid by the Company at the Redemption Price together with accrued interest to
the Redemption Date; PROVIDED, HOWEVER, that installments of interest on Bearer
Securities whose Stated Maturity is on or prior to the Redemption Date shall be
payable only at an office or agency located outside the United States (except as
otherwise provided in Section 10.2) and, unless otherwise specified as
contemplated by Section 3.1, only upon presentation and surrender of coupons for
such interest; and PROVIDED, FURTHER, that, unless otherwise specified as
contemplated by Section 3.1, installments of interest on Registered Securities
whose Stated Maturity is on or prior to the
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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
3.7.
If any Bearer Security surrendered for redemption shall not be accompanied
by all appurtenant coupons maturing after the Redemption Date, such Security may
be paid after deducting from the Redemption Price an amount equal to the face
amount of all such missing coupons, or the surrender of such missing coupon or
coupons may be waived by the Company and the Trustee if there be furnished to
them such security or indemnity as they may require to save each of them and any
Paying Agent harmless. If thereafter the Holder of such Security shall surrender
to the Trustee or any Paying Agent any such missing coupon in respect of which a
deduction shall have been made from the Redemption Price, such Holder shall be
entitled to receive the amount so deducted; PROVIDED, HOWEVER, that interest
represented by coupons shall be payable only at an office or agency located
outside the United States (except as otherwise provided in Section 10.2) and
unless otherwise specified as contemplated by Section 3.1 only upon presentation
and surrender of those coupons.
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 11.7 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.
ARTICLE XII
SINKING FUNDS
SECTION 12.1 APPLICABILITY OF ARTICLE.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of a series except as otherwise specified as
contemplated by Section 3.1 for Securities of such series.
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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 12.2. Each sinking fund payment shall be applied to the redemption of
Securities of any series as provided for by the terms of Securities of such
series.
SECTION 12.2 SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.
The Company (1) may deliver Outstanding Securities of a series (other than
any previously called for redemption), together in the case of any Bearer
Securities of such series with all unmatured coupons appertaining thereto, 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.
Any resolution passed or decision taken at any meeting of Holders of
Securities of any series duly held in accordance with this Section shall be
binding on all the Holders of Securities of such series and the related coupons,
whether or not present or represented at the meeting.
SECTION 12.3 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 12.2 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 11.3 and cause notice of
the redemption thereof to be given in the name of and at the expense of the
Company in the manner provided in Section 11.4. Such notice having been duly
given, the redemption of such Securities shall be made upon the terms and in the
manner stated in Sections 11.6 and 11.7.
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ARTICLE XIII
MEETINGS OF HOLDERS OF SECURITIES
SECTION 13.1 PURPOSES FOR WHICH MEETINGS MAY BE CALLED.
If Securities of a series are issuable as Bearer Securities, a meeting of
Holders of Securities of such series may be called at any time and from time to
time pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Securities of such
series.
SECTION 13.2 CALL, NOTICE AND PLACE OF MEETINGS.
(a) The Trustee may at any time call a meeting of Holders of Securities of
any series for any purpose specified in Section 13.1, to be held at such time
and at such place in the Borough of Manhattan, The City of New York, or in
London as the Trustee shall determine. Notice of every meeting of Holders of
Securities of any series, setting forth the time and the place of such meeting
and in general terms the action proposed to be taken at such meeting, shall be
given, in the manner provided in Section 1.6, not less than 2l nor more than 180
days prior to the date fixed for the meeting (or, in the case of a meeting of
Holders with respect to Securities of a series all or part of which are
represented by a Book-Entry Security, not less than 20 nor more than 40 days).
(b) In case at any time the Company, pursuant to a Board Resolution, or the
Holders of at least 10% in principal amount of the Outstanding Securities of any
series shall have requested the Trustee to call a meeting of the Holders of
Securities of such series for any purpose specified in Section 13.1, by written
request setting forth in reasonable detail the action proposed to be taken at
the meeting, and the Trustee shall not have made the first publication of the
notice of such meeting within 21 days after receipt of such request or shall not
thereafter proceed to cause the meeting to be held as provided herein, then the
Company or the Holders of Securities of such series in the amount above
specified, as the case may be, may determine the time and the place in the
Borough of Manhattan, The City of New York or in London for such meeting and may
call such meeting for such purposes by giving notice thereof as provided in
subsection (a) of this Section.
SECTION 13.3 PERSONS ENTITLED TO VOTE AT MEETINGS.
Upon the calling of a meeting of Holders with respect to the Securities of
a series all or part of which are represented by a Book-Entry Security, a record
date shall be established for determining Holders of Outstanding Securities of
such series entitled to vote at such meeting, which record date shall be the
close of business on the day the notice of the meeting of Holders is given in
accordance with Section 13.2. The Holders on such record date, and their
designated proxies, and only such Persons, shall be entitled to vote at any
meeting of Holders. To be entitled to vote at any meeting of Holders a
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Person shall (a) be a Holder of one or more Securities or (b) be a Person
appointed by an instrument in writing as proxy by a Holder of one or more
Securities; PROVIDED, HOWEVER, that in the case of any meeting of Holders with
respect to the Securities of a series all or part of which are represented by a
Book-Entry Security, only Holders, or their designated proxies, of record on the
record date established pursuant to Section 13.3 hereof shall be entitled to
vote at such meeting. The only Persons who shall be entitled to be present or to
speak at any meeting of Holders shall be the Persons entitled to vote at such
meeting and their counsel and any representatives of the Trustee and its counsel
and any representatives of the Company and its counsel.
SECTION 13.4 QUORUM; ACTION.
The Persons entitled to vote a majority in principal amount of the
Outstanding Securities of a series shall constitute a quorum for a meeting of
Holders of Securities of such series; PROVIDED, HOWEVER, that if any action is
to be taken at such meeting with respect to a consent or waiver which this
Indenture expressly provides may be given by the Holders of not less than 66-
2/3% in principal amount of the Outstanding Securities of a series, the Persons
entitled to vote 66-2/3% in principal amount of the Outstanding Securities of
such series shall constitute a quorum. In the absence of a quorum within 30
minutes of the time appointed for any such meeting, the meeting shall, if
convened at the request of Holders of Securities of such series, be dissolved.
In any other case the meeting may be adjourned for a period of not less than 10
days as determined by the chairman of the meeting prior to the adjournment of
such meeting. In the absence of a quorum at any such adjourned meeting, such
adjourned meeting may be further adjourned for a period of not less than 10 days
as determined by the chairman of the meeting prior to the adjournment of such
adjourned meeting. Notice of the reconvening of any adjourned meeting shall be
given as provided in Section 13.2 (a), except that such notice need be given
only once not less than five days prior to the date on which the meeting is
scheduled to be reconvened. Notice of the reconvening of an adjourned meeting
shall state expressly the percentage, as provided above, of the principal amount
of the outstanding Securities of such series which shall constitute a quorum.
Notwithstanding the foregoing, no meeting of Holders with respect to Securities
of any Series which is represented in whole or in part by a Book-Entry Security,
shall be adjourned to a date more than 90 days after the record date for such
meeting unless the Trustee shall send out a new notice of meeting and establish,
in accordance with Section 13.3, a new record date for Holders entitled to vote
at such meeting.
Except as limited by the proviso to Section 9.2, any resolution presented
to a meeting or adjourned meeting duly reconvened at which a quorum is present
as aforesaid may be adopted by the affirmative vote of the Holders of a majority
in principal amount of the Outstanding Securities of that series; PROVIDED,
HOWEVER, that, except as limited by the proviso to Section 9.2 any resolution
with respect to any consent or waiver which this Indenture expressly provides
may be given by the Holders of not less than 66- 2/3% in principal amount of the
Outstanding Securities of a series may be adopted at a meeting or an adjourned
meeting duly convened and at which a quorum is present
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as aforesaid only by the affirmative vote of the Holders of 66-2/3% in principal
amount of the Outstanding Securities of that series; and PROVIDED, FURTHER,
that, except as limited by the proviso to Section 9.2, any resolution with
respect to any request, demand, authorization, direction, notice, consent,
waiver or other action which this Indenture expressly provides may be made,
given or taken by the Holders of a specified percentage which is less than a
majority, in principal amount of the Outstanding Securities of a series may be
adopted at a meeting or an adjourned meeting duly reconvened and at which a
quorum is present as aforesaid by the affirmative vote of the Holders of such
specified percentage in principal amount of the Outstanding Securities of that
series.
SECTION 13.5 DETERMINATION OF VOTING RIGHTS; CONDUCT AND ADJOURNMENT OF
MEETINGS.
(a) Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Holders of Securities of a series in regard to proof of the holding of
Securities of such series and of the appointment of proxies and in regard to the
appointment and duties of inspectors of votes, the submission and examination of
proxies, certificates and other evidence of the right to vote, and such other
matters concerning the conduct of the meeting as it shall deem appropriate.
Except as otherwise permitted or required by any such regulations, the holding
of Securities shall be proved in the manner specified in Section 1.4 and the
appointment of any proxy shall be proved in the manner specified in Section 1.4
or by having the signature of the person executing the proxy witnessed or
guaranteed by any trust company, bank or banker authorized by Section 1.4 to
certify to the holding of Bearer Securities. Such regulations may provide that
written instruments appointing proxies, regular on their face, may be presumed
valid and genuine without the proof specified in Section 1.4 or other proof.
(b) The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Holders of Securities as provided in Section l3.2(b), in which
case the Company or the Holders of Securities of the series calling the meeting,
as the case may be, shall in like manner appoint a temporary chairman. A
permanent chairman and a permanent secretary of the meeting shall be elected by
vote of the Persons entitled to vote a majority in principal amount of the
Outstanding Securities of such series represented at the meeting.
(c) At any meeting each Holder of a Security of such series or proxy shall
be entitled to one vote for each $ 1,000 principal amount of the Outstanding
Securities of such series held or represented by him; PROVIDED, HOWEVER, that no
vote shall be cast or counted at any meeting in respect of any Security
challenged as not Outstanding and ruled by the chairman of the meeting to be not
Outstanding. The chairman of the meeting shall have no right to vote, except as
a Holder of a Security of such series or proxy.
(d) Any meeting of Holders of Securities of any series duly called pursuant
to Section 13.2 at which a quorum is present may be adjourned from
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time to time by Persons entitled to vote a majority in principal amount of the
Outstanding Securities of such series represented at the meeting; and the
meeting may be held as so adjourned without further notice.
SECTION 13.6 COUNTING VOTES AND RECORDING ACTION OF MEETINGS.
The vote upon any resolution submitted to any meeting of Holders of
Securities of any series shall be by written ballots on which shall be
subscribed the signatures of the Holders of Securities of such series or of
their representatives by proxy and the principal amounts and serial numbers of
the Outstanding Securities of such series held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record, at least in
duplicate, of the proceedings of each meeting of Holders of Securities of any
series shall be prepared by the secretary of the meeting and there shall be
attached to said record the original reports of the inspectors of votes on any
vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was given as provided in Section 13.2 and, if
applicable, Section 13.4. Each copy shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one such
copy shall be delivered to the Company, and another to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting. Any record so signed and verified shall be conclusive evidence
of the matters therein stated.
ARTICLE XIV
REDEMPTION OF SECURITIES AT OPTION OF HOLDERS
SECTION 14.1 APPLICABILITY OF ARTICLE.
Redemption of Securities at the election of the Holders thereof, as
required by any provision of this Indenture or such Securities, shall be made in
accordance with such provision and this Article.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of such Securities at the option of
the Holders thereof shall relate, in the case of any Registered Security
submitted for redemption only in part, to the portion of the principal amount of
such Registered Security which has been so submitted for redemption.
SECTION 14.2 REDEMPTION AT OPTION OF HOLDERS UPON A CHANGE IN CONTROL OF THE
COMPANY.
(a) The provisions of this Article XIV shall apply only to Securities of
any series, or particular Securities within a series, for which the terms
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of such Securities, established pursuant to Section 3.1 of this Indenture,
specify that this Article Fourteen shall apply thereto.
(b) Each Security or any portion of a Registered Security submitted for
redemption at the option of the Holders thereof shall be redeemed by the Company
on or after the Exchange Date in the case of Securities of any series issuable
as Bearer Securities or at any time in the case of all other Securities under
the conditions and at the Redemption Price for redemption at the option of
Holders upon a Change in Control of the Company specified in the forms of
Securities set forth in Exhibits A through D. On or after the Exchange Date in
the case of Securities of any Series issuable as Bearer Securities or at any
time in the case of all other Securities, upon the deposit of any Security with
a Paying Agent together with a duly signed and completed Notice of Redemption at
Holder's option upon a Change in Control of the Company, all in accordance with
the provisions contained in the forms of Securities set forth in Exhibits A
through D, the Holder of such Security shall be entitled to receive from such
Paying Agent a nontransferable receipt of deposit evidencing such deposit.
SECTION 14.3 NOTICE OF CHANGE IN CONTROL.
Notice of any Change in Control shall be given by the Company on or before
the tenth day after such Change in Control to each Holder of Securities in
accordance with Section 1.6, and by written notice to the Trustee on or before
the ninth day after such Change in Control, unless the Continuing Directors have
approved such Change in Control, or the Company gives or shall have given, if
permitted to do so by the terms of the Securities of a series (whether before or
after such Change in Control), notice of the redemption at its option of all of
the Securities of such series, in either case, on or before such ninth day.
The notice as to Change in Control shall state:
(1) the event constituting the Change in Control;
(2) the Redemption Date for redemptions pursuant to Section 14.1,
which shall be 35 days after the date of such Notice;
(3) the Redemption Price;
(4) the date which is the last day of the Exercise Period;
(5) if any part of the Exercise Period is on or after the Exchange
Date, the place or places where such Securities, together in the case of
Bearer Securities with all coupons appertaining thereto maturing after the
Redemption Date, are to be surrendered for payment of the Redemption Price;
and
(6) that exercise of the option to elect redemption is irrevocable.
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SECTION 14.4 DEPOSIT OF REDEMPTION PRICE.
On a Redemption Date, the Company shall deposit with the Trustee or with a
Paying Agent in immediately available funds (or, if the Company is acting as its
own Paying Agent, segregate and hold in trust as provided in Section 10.3) an
amount of money sufficient to pay the Redemption Price of all of the Securities
which are to be redeemed on that date.
ARTICLE XV
CONVERSION OF SECURITIES
SECTION 15.1 APPLICABILITY OF ARTICLE.
The provisions of this Article shall be applicable to the Securities of any
series which are convertible into shares of Common Stock of the Company, and the
issuance of such shares of Common Stock upon the conversion of such Securities,
except as otherwise specified as contemplated by Section 3.1 for the Securities
of such series. The terms and provisions applicable to the conversion of
Securities of any series into securities of the Company (other than Common
Stock) shall, if applicable, be set forth in an Officers' Certificate or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of such series in accordance with Section 3.1.
SECTION 15.2 EXERCISE OF CONVERSION PRIVILEGE.
In order to exercise a conversion privilege, the Holder of a Security of a
series with such a privilege shall surrender such Security to the Company at the
office or agency maintained for that purpose pursuant to Section 10.2,
accompanied by written notice to the Company that the Holder elects to convert
such Security or a specified portion thereof. Such notice shall also state, if
different from the name and address of such Holder, the name or names (with
address) in which the certificate or certificates for shares of Common Stock
which shall be issuable on such conversion shall be issued. Securities
surrendered for conversion shall (if so required by the Company or the Trustee)
be duly endorsed by or accompanied by instruments of transfer in forms
satisfactory to the Company and the Trustee duly executed by the registered
Holder or its attorney duly authorized in writing; and Securities so surrendered
for conversion during the period from the close of business on any Regular
Record Date to the opening of business on the next succeeding Interest Payment
Date (excluding Securities or portions thereof called for redemption during such
period) shall also be accompanied by payment in funds acceptable to the Company
of an amount equal to the interest payable on such Interest Payment Date on the
principal amount of such Security then being converted, and such interest shall
be payable to such registered Holder notwithstanding the conversion of such
Security, subject to the provisions of Section 3.7 relating to the payment of
Defaulted Interest by the Company. As promptly as practicable after the receipt
of such notice and of any payment required pursuant to a Board Resolution and,
subject to Section 3.3, set
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forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto setting forth the
terms of such series of Security, and the surrender of such Security in
accordance with such reasonable regulations as the Company may prescribe, the
Company shall issue and shall deliver, at the office or agency at which such
Security is surrendered, to such Holder or on its written order, a certificate
or certificates for the number of full shares of Common Stock issuable upon the
conversion of such Security (or specified portion thereof), in accordance with
the provisions of such Board Resolution, Officers' Certificate or supplemental
indenture, and cash as provided therein in respect of any fractional share of
such Common Stock otherwise issuable upon such conversion. Such conversion shall
be deemed to have been effected immediately prior to the close of business on
the date on which such notice and such payment, if required, shall have been
received in proper order for conversion by the Company and such Security shall
have been surrendered as aforesaid (unless such Holder shall have so surrendered
such Security and shall have instructed the Company to effect the conversion on
a particular date following such surrender and such Holder shall be entitled to
convert such Security on such date, in which case such conversion shall be
deemed to be effected immediately prior to the close of business on such date)
and at such time the rights of the Holder of such Security as such Security
Holder shall cease and the person or persons in whose name or names any
certificate or certificates for shares of Common Stock of the Company shall be
issuable upon such conversion shall be deemed to have become the Holder or
Holders of record of the shares represented thereby. Except as set forth above
and subject to the final paragraph of Section 3.7, no payment or adjustment
shall be made upon any conversion on account of any interest accrued on the
Securities surrendered for conversion or on account of any dividends on the
Common Stock of the Company issued upon such conversion.
In the case of any Security which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and
deliver to or on the order of the Holder thereof, at the expense of the Company,
a new Security or Securities of the same series, of authorized denominations, in
aggregate principal amount equal to the unconverted portion of such Security.
SECTION 15.3 NO FRACTIONAL SHARES.
No fractional share of Common Stock of the Company shall be issued upon
conversions of Securities of any series. If more than one Security shall be
surrendered for conversion at one time by the same Holder, the number of full
shares which shall be issuable upon conversion shall be computed on the basis of
the aggregate principal amount of the Securities (or specified portions thereof
to the extent permitted hereby) so surrendered. If, except for the provisions of
this Section 15.3, any Holder of a Security or Securities would be entitled to a
fractional share of Common Stock of the Company upon the conversion of such
Security or Securities, or specified portions thereof, the Company shall pay to
such Holder an amount in cash equal to the current market value of such
fractional share computed, (i) if such Common Stock is listed or admitted to
unlisted trading privileges on a national securities exchange, on
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the basis of the last reported sale price regular way on such exchange on the
last trading day prior to the date of conversion upon which such a sale shall
have been effected, or (ii) if such Common Stock is not at the time so listed or
admitted to unlisted trading privileges on a national securities exchange, on
the basis of the average of the bid and asked prices of such Common Stock in the
over-the- counter market, on the last trading day prior to the date of
conversion, as reported by the National Quotation Bureau, Incorporated or
similar organization if the National Quotation Bureau, Incorporated is no longer
reporting such information, or if not so available, the fair market price as
determined by the Board of Directors. For purposes of this Section, "trading
day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday other than
any day on which the Common Stock is not traded on the New York Stock Exchange,
or if the Common Stock is not traded on the New York Stock Exchange, on the
principal exchange or market on which the Common Stock is traded or quoted.
SECTION 15.4 ADJUSTMENT OF CONVERSION PRICE.
The conversion price of Securities of any series that is convertible into
Common Stock of the Company shall be adjusted for any stock dividends, stock
splits, reclassification, combinations or similar transactions in accordance
with the terms of the supplemental indenture or Board Resolutions setting forth
the terms of the Securities of such series.
Whenever the conversion price is adjusted, the Company shall compute the
adjusted conversion price in accordance with terms of the applicable Board
Resolution or supplemental indenture and shall prepare an Officers' Certificate
setting forth the adjusted conversion price and showing in reasonable detail the
facts upon which such adjustment is based, and such certificate shall forthwith
be filed at each office or agency maintained for the purpose of conversion of
Securities pursuant to Section 10.2 and, if different, with the Trustee. The
Company shall forthwith cause a notice setting forth the adjusted conversion
price to be mailed, first class postage prepaid, to each Holder of Securities of
such series at its address appearing on the Security Register and to any
conversion agent other than the Trustee.
SECTION 15.5 NOTICE OF CERTAIN CORPORATE ACTIONS.
In case:
(a) the Company shall declare a dividend (or any other distribution) on its
Common Stock payable otherwise than in cash out of its retained earnings (other
than a dividend for which approval of any shareholders of the Company is
required); or
(b) the Company shall authorize the granting to the holders of its Common
Stock of rights, options or warrants to subscribe for or purchase any shares of
capital stock of any class or of any other rights (other than any such grant for
which approval of any shareholders of the Company is required); or
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(c) of any reclassification of the Common Stock of the Company (other than
a subdivision or combination of its outstanding shares of Common Stock, or of
any consolidation, merger or share exchange to which the Company is a party and
for which approval of any shareholders of the Company is required), or of the
sale of all or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or winding up
of the Company;
then the Company shall cause to be filed with the Trustee, and shall cause to be
mailed to all Holders at their last addresses as they shall appear in the
Securities Register, at least 20 days (or 10 days in any case specified in
clause (a) or (b) above) prior to the applicable record date hereinafter
specified, a notice stating (i) the date on which a record is to be taken for
the purpose of such dividend, distribution, rights, options or warrants, or, if
a record is not to be taken, the date as of which the holders of Common Stock of
record to be entitled to such dividend, distribution, rights, options or
warrants are to be determined, or (ii) the date on which such reclassification,
consolidation, merger, share exchange, sale, dissolution, liquidation or winding
up is expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, share exchange, sale, dissolution,
liquidation or winding up. If at any time the Trustee shall not be the
conversion agent, a copy of such notice shall also forthwith be filed by the
Company with the Trustee.
SECTION 15.6 RESERVATION OF SHARES OF COMMON STOCK.
The Company shall at all times reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock or treasury
shares, for the purpose of effecting the conversion of Securities, the full
number of shares of Common Stock of the Company then issuable upon the
conversion of all outstanding Securities of any series that has conversion
rights.
SECTION 15.7 PAYMENT OF CERTAIN TAXES UPON CONVERSION.
The Company will pay any and all taxes that may be payable in respect of
the issue or delivery of shares of its Common Stock on conversion of Securities
pursuant hereto. The Company shall not, however, be required to pay any tax
which may be payable in respect of any transfer involved in the issue and
delivery of shares of its Common Stock in a name other than that of the Holder
of the Security or Securities to be converted, and no such issue or delivery
shall be made unless and until the person requesting such issue has paid to the
Company the amount of any such tax, or has established, to the satisfaction of
the Company, that such tax has been paid.
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SECTION 15.8 NONASSESSABILITY.
The Company covenants that all shares of its Common Stock which may be
issued upon conversion of Securities will upon issue in accordance with the
terms hereof be duly and validly issued and fully paid and nonassessable.
SECTION 15.9 EFFECT OF CONSOLIDATION OR MERGER ON CONVERSION PRIVILEGE.
In case of any consolidation of the Company with, or merger of the Company
into or with any other Person, or in case of any sale of all or substantially
all of the assets of the Company, the Company or the Person formed by such
consolidation or the Person into which the Company shall have been merged or the
Person which shall have acquired such assets, as the case may be, shall execute
and deliver to the Trustee a supplemental indenture providing that the Holder of
each Security then outstanding of any series that is convertible into Common
Stock of the Company shall have the right, which right shall be the exclusive
conversion right thereafter available to said Holder (until the expiration of
the conversion right of such Security), to convert such Security into the kind
and amount of shares of stock or other securities or property (including cash)
receivable upon such consolidation, merger or sale by a holder of the number of
shares of Common Stock of the Company into which such Security might have been
converted immediately prior to such consolidation, merger or sale, subject to
compliance with the other provisions of this Indenture, such Security and such
supplemental indenture. Such supplemental indenture shall provide for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in such Security. The above provisions of this Section
shall similarly apply to successive consolidations, mergers or sales. It is
expressly agreed and understood that anything in this Indenture to the contrary
notwithstanding, if, pursuant to such merger, consolidation or sale, holders of
outstanding shares of Common Stock of the Company do not receive shares of
common stock of the surviving corporation but receive other securities, cash or
other property or any combination thereof, Holders of Securities shall not have
the right to thereafter convert their Securities into common stock of the
surviving corporation or the corporation which shall have acquired such assets,
but rather, shall have the right upon such conversion to receive the other
securities, cash or other property receivable by a holder of the number of
shares of Common Stock of the Company into which the Securities held by such
holder might have been converted immediately prior to such consolidation, merger
or sale, all as more fully provided in the first sentence of this Section 15.9.
Anything in this Section 15.9 to the contrary notwithstanding, the provisions of
this Section 15.9 shall not apply to a merger or consolidation of another
corporation with or into the Company pursuant to which both of the following
conditions are applicable: (i) the Company is the surviving corporation and (ii)
the outstanding shares of Common Stock of the Company are not changed or
converted into any other securities or property (including cash) or changed in
number or character or reclassified pursuant to the terms of such merger or
consolidation.
As evidence of the kind and amount of shares of stock or other securities
or property (including cash) into which Securities may properly be
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convertible after any such consolidation, merger or sale, or as to the
appropriate adjustments of the conversion prices applicable with respect
thereto, the Trustee shall be furnished with and may accept the certificate or
opinion of an independent certified public accountant with respect thereto; and,
in the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely thereon, and shall not be responsible or accountable to any
Holder of Securities for any provision in conformity therewith or approved by
such independent certified accountant which may be contained in said
supplemental indenture.
SECTION 15.10 DUTIES OF TRUSTEE REGARDING CONVERSION.
Neither the Trustee nor any conversion agent shall at any time be under any
duty or responsibility to any Holder of Securities of any series that is
convertible into Common Stock of the Company to determine whether any facts
exist which may require any adjustment of the conversion price, or with respect
to the nature or extent of any such adjustment when made, or with respect to the
method employed, whether herein or in any supplemental indenture, any
resolutions of the Board of Directors or written instrument executed by one or
more officers of the Company provided to be employed in making the same. Neither
the Trustee nor any conversion agent shall be accountable with respect to the
validity or value (or the kind or amount) of any shares of Common Stock of the
Company, or of any securities or property, which may at any time be issued or
delivered upon the conversion of any Securities and neither the Trustee nor any
conversion agent makes any representation with respect thereto. Neither the
Trustee nor any conversion agent shall be responsible for any failure of the
Company to issue, transfer or deliver any shares of its Common Stock or stock
certificates or other securities or property upon the surrender of any Security
for the purpose of conversion or to comply with any of the covenants of the
Company contained in this Article Fifteen or in the applicable supplemental
indenture, resolutions of the Board of Directors or written instrument executed
by one or more duly authorized officers of the Company.
SECTION 15.11 REPAYMENT OF CERTAIN FUNDS UPON CONVERSION.
Any funds which at any time shall have been deposited by the Company or on
its behalf with the Trustee or any other paying agent for the purpose of paying
the principal of, and premium, if any, and interest, if any, on any of the
Securities (including funds deposited for the sinking fund referred to in
Article III hereof) and which shall not be required for such purposes because of
the conversion of such Securities as provided in this Article XV shall after
such conversion be repaid to the Company by the Trustee upon the Company's
written request.
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ARTICLE XVI
SUBORDINATION OF SECURITIES
SECTION 16.1 SECURITIES SUBORDINATE TO SENIOR INDEBTEDNESS.
The Company covenants and agrees, and each Holder of a Security, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article, indebtedness represented by
the Securities and the payment of the principal of (and premium, if any) and
interest on each and all of the Securities are hereby expressly made subordinate
and subject in right of payment to the prior payment in full of all amounts then
due and payable in respect of all Senior Indebtedness.
SECTION 16.2 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
In the event of (a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, arrangement, reorganization, debt restructuring or
other similar case or proceeding in connection with any insolvency or bankruptcy
proceeding, relative to the Company or to its assets, or (b) any liquidation,
dissolution or other winding up of the Company, whether voluntary or involuntary
and whether or not involving insolvency or bankruptcy, or (c) any assignment for
the benefit of creditors or any other marshalling of assets and liabilities of
the Company, then and in any such event specified in (a), (b) or (c) above (each
such event, if any, herein sometimes referred to as a "Proceeding") the holders
of Senior Indebtedness shall be entitled to receive payment in full of all
amounts due or to become due on or in respect of all Senior Indebtedness, or
provision shall be made for such payment in cash or cash equivalents or
otherwise in a manner satisfactory to the holders of Senior Indebtedness, before
the Holders of the Securities are entitled to receive any payment or
distribution of any kind or character, whether in cash, property or securities
(including any payment or distribution which may be payable or deliverable by
reason of the payment of any other Debt of the Company subordinated to the
payment of the Securities, such payment or distribution being hereinafter
referred to as "Junior Subordinated Payment"), on account of principal of (or
premium, if any) or interest on the Securities or on account of the purchase or
other acquisition of Securities by the Company or any Subsidiary and to that end
the holders of Senior Indebtedness shall be entitled to receive, for application
to the payment thereof, any payment or distribution of any kind or character,
whether in cash, property or securities, including any Junior Subordinated
Payment, which may be payable or deliverable in respect of the Securities in any
such Proceeding.
In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, including any Junior Subordinated
Payment, before all Senior Indebtedness is paid in full or payment thereof is
provided for in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of Senior Indebtedness, and if such fact shall, at or prior to
the time of such payment or distribution, have been made known to the Trustee
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or, as the case may be, such Holder, then and in such event such payment or
distribution shall be paid over or delivered forthwith to the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee, agent or other
Person making payment or distribution of assets of the Company for application
to the payment of all Senior Indebtedness remaining unpaid, to the extent
necessary to pay all Senior Indebtedness in full, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Indebtedness.
Any taxes that have been withheld or deducted from any payment or distribution
in respect of the Securities, or any taxes that ought to have been withheld or
deducted from any such payment or distribution that have been remitted to the
relevant taxing authority, shall not be considered to be an amount that the
Trustee or the Holder of any Security receives for purposes of this Section.
For purposes of this Article only, the words "any payment or distribution
of any kind or character, whether in cash, property or securities" shall not be
deemed to include shares of stock of the Company as reorganized or readjusted,
or securities of the Company or any other corporation provided for by a plan of
reorganization or readjustment which securities are subordinated in right of
payment to all then outstanding Senior Indebtedness to substantially the same
extent as the Securities are so subordinated as provided in this Article. The
consolidation of the Company with, or the merger of the Company into, another
Person or the liquidation or dissolution of the Company following the sale of
all or substantially all of its properties and assets as an entirety to another
Person or the liquidation or dissolution of the Company following the sale of
all or substantially all of its properties and assets as an entirety to another
Person upon the terms and conditions set forth in Article VIII shall not be
deemed a Proceeding for the purposes of this Section if the Person formed by
such consolidation or into which the Company is merged or the Person which
acquires by sale such properties and assets as an entirety, as the case may be,
shall, as a part of such consolidation, merger, or sale comply with the
conditions set forth in Article VIII.
SECTION 16.3 PRIOR PAYMENT TO SENIOR INDEBTEDNESS UPON ACCELERATION OF
SECURITIES.
In the event that any Securities are declared due and payable before their
Stated Maturity, then and in such event the holders of the Senior Indebtedness
outstanding at the time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts due on or in respect of such
Senior Indebtedness, or provision shall be made for such payment in cash or cash
equivalents or otherwise in a manner satisfactory to the holders of Senior
Indebtedness, before the Holders of the Securities are entitled to receive any
payment (including any payment which may be payable by reason of the payment of
any other indebtedness of the Company being subordinated to the payment of the
Securities) by the Company on account of the principal of (or premium, if any)
or interest on the Securities or on account of the purchase or other acquisition
of Securities by the Company or any Subsidiary; PROVIDED, HOWEVER, that nothing
in this Section shall prevent the satisfaction of any sinking fund payment in
accordance with Article XII by delivering and crediting pursuant to Section 12.2
Securities which have been
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acquired (upon redemption or otherwise) prior to such declaration of
acceleration or which have been converted pursuant to Article XV.
In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or, as the case may
be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section shall not apply to any payment with respect
to which Section 12.2 would be applicable.
SECTION 16.4 NO PAYMENT WHEN SENIOR INDEBTEDNESS IN DEFAULT.
(a) In the event and during the continuation of any default in the payment
of principal of (or premium, if any) or interest on any Senior Indebtedness, or
in the event that any event of default with respect to any Senior Indebtedness
shall have occurred and be continuing and shall have resulted in such Senior
Indebtedness becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable, unless and until such
event of default shall have been cured or waived or shall have ceased to exist
and such acceleration shall have been rescinded or annulled, or (b) in the event
any judicial proceeding shall be pending with respect to any such default in
payment or such event of default, then no payment (including any payment which
may be payable by reason of the payment of any other indebtedness of the Company
being subordinated to the payment of the Securities) shall be made by the
Company on account of principal of (or premium, if any) or interest on the
Securities or on account of the purchase or other acquisition of Securities by
the Company or any Subsidiary; PROVIDED, HOWEVER, that nothing in this Section
shall prevent the satisfaction of any sinking fund payment in accordance with
Article XII by delivering and crediting pursuant to Section 12.2 Securities
which have been acquired (upon redemption or otherwise) prior to such default in
payment or event of default or which have been converted pursuant to Article XV.
In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or, as the case may
be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section shall not apply to any payment with respect
to which Section 16.2 would be applicable.
SECTION 16.5 PAYMENT PERMITTED IF NO DEFAULT.
Nothing contained in this Article or elsewhere in this Indenture or in any
of the Securities shall prevent (a) the Company, at any time except during the
pendency of any Proceeding referred to in Section 16.2 or under the
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conditions described in Sections 16.3 and 16.4, from making payments at any time
of principal of (and premium, if any) or interest on the Securities, or (b) the
application by the Trustee of any money deposited with it hereunder to the
payment of or on account of the principal of (and premium, if any) or interest
on the Securities or the retention of such payment by the Holders, if, at the
time of such application by the Trustee, it did not have knowledge that such
payment would have been prohibited by the provisions of this Article.
SECTION 16.6 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS.
Subject to the payment in full of all Senior Indebtedness, or the provision
for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Indebtedness, the Holders of the
Securities shall be subrogated to the extent of the payments or distributions
made to the holders of such Senior Indebtedness pursuant to the provisions of
this Article (equally and ratably with the holders of all indebtedness of the
Company which by its express terms is subordinated to indebtedness of the
Company to substantially the same extent as the Securities are subordinated to
the Senior Indebtedness and is entitled to like rights of subrogation by reason
of any payments or distributions made to holders of such Senior Indebtedness) to
the rights of the holders of such Senior Indebtedness to receive payments and
distributions of cash, property and securities applicable to the Senior
Indebtedness until the principal of (and premium, if any) and interest on the
Securities shall be paid in full. If the Trustee or the Holders of the
Securities are not for any reason entitled to be subrogated to the rights of
holders of Senior Indebtedness in respect of such payment or distribution, then
the Trustee or the Holders of the Securities may require each holder of Senior
Indebtedness to whom any such payment or distribution is made as a condition to
such payment or distribution to assign its Senior Indebtedness to the extent of
such payment or distribution and all rights with respect thereto to the Trustee
on behalf of the Holders. Such assignment shall not be effective until such time
as all Senior Indebtedness has been paid in full or payment thereof provided
for. For purposes of such subrogation or assignment, no payments or
distributions to the holders of the Senior Indebtedness of any cash, property or
securities to which the Holders of the Securities or the Trustee would be
entitled except for the provisions of this Article, and no payments over
pursuant to the provisions of this Article to the holders of Senior Indebtedness
by Holders of the Securities or the Trustee, shall, as among the Company, its
creditors other than holders of Senior Indebtedness, and the Holders of the
Securities, be deemed to be a payment or distribution by the Company to or on
account of the Senior Indebtedness.
SECTION 16.7 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.
The provisions of this Article are and are intended solely for the purpose
of defining the relative rights of the Holders of the Securities on the one hand
and the holders of Senior Indebtedness on the other hand. Nothing contained in
this Article or elsewhere in this Indenture or in the Securities is intended to
or shall (a) impair, as among the Company, its
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creditors other than holders of Senior Indebtedness, and the Holders of the
Securities, the obligations of the Company, which are absolute and unconditional
(and which, subject to the rights under this Article of the holders of Senior
Indebtedness, are intended to rank equally with all other general unsecured
obligations of the Company), to pay to the Holders of the Securities the
principal of (and premium, if any) and interest on the Securities as and when
the same shall become due and payable in accordance with their terms; or (b)
affect the relative rights against the Company of the Holders of the Securities
and creditors of the Company other than the holders of Senior Indebtedness; or
(c) prevent the Trustee or the Holder of any Security from exercising all
remedies otherwise permitted by applicable law upon default under this Indenture
including, without limitation, filing and voting claims in any Proceeding,
subject to the rights, if any, under this Article of the holders of Senior
Indebtedness to receive cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder.
SECTION 16.8 TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Security by its acceptance thereof authorizes and directs
the Trustee on its behalf to take such action as may be necessary or appropriate
to acknowledge or effectuate the subordination provided in this Article and
appoints the Trustee its attorney-in-fact for any and all such purposes.
SECTION 16.9 NO WAIVER OF SUBORDINATION PROVISIONS.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof that any such holder may have or
be otherwise charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Indebtedness may, at any time and from time to time, without
the consent of or notice to the Trustee or the Holders of the Securities,
without incurring responsibility to the Holders of the Securities, and without
impairing or releasing the subordination provided in this Article or the
obligations hereunder of the Holders of the Securities to the holders of Senior
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter or
increase, Senior Indebtedness, or otherwise amend or supplement in any manner
Senior Indebtedness or any instrument evidencing the same or any agreement under
which Senior Indebtedness is outstanding; (ii) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (iii) release any Person liable in any manner for the collection
of Senior Indebtedness; and (iv) exercise or refrain from exercising any rights
against the Company and any other Person.
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SECTION 16.10 NOTICE TO TRUSTEE.
The Company shall give prompt written notice to the Trustee of any fact
known to the Company which would prohibit the making of any payment to or by the
Trustee in respect of the Securities. Notwithstanding the provisions of this
Article or any other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from the
Company or a holder of Senior Indebtedness or from any trustee, agent or
representative therefor; and, prior to the receipt of any such written notice,
the Trustee, subject to the provisions of Section 601, shall be entitled in all
respects to assume that no such facts exist; PROVIDED, HOWEVER, that if the
Trustee shall not have received the notice provided for in this Section at least
two Business Days prior to the date upon which by the terms hereof any money may
become payable for any purpose (including, without limitation, the payment of
the principal of (and premium, if any) or interest on any Security), then,
anything herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such money and to apply the same to the
purpose for which such money was received and shall not be affected by any
notice to the contrary which may be received by it within two Business Days
prior to such date.
The Trustee shall be entitled to rely on the delivery to it of a written
notice by a Person representing himself or herself to be a holder of Senior
Indebtedness (or a trustee, agent or representative therefor) to establish that
such notice has been given by a holder of Senior Indebtedness (or a trustee,
agent or representative therefor). In the event that the Trustee determines in
good faith that further evidence is required with respect to the right of any
Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article, and if such evidence
is not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment.
SECTION 16.11 RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING AGENT.
Upon any payment or distribution of assets of the Company referred to in
this Article, the Trustee and the Holders of the Securities shall be entitled to
rely upon any order or decree entered by any court of competent jurisdiction in
which such Proceeding is pending, or a certificate of the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee for the benefit of creditors,
agent or other Person making such payment or distribution, delivered to the
Trustee or to the Holders of Securities, for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, the holders of
the Senior Indebtedness and other indebtedness of the
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Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.
SECTION 16.12 TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR INDEBTEDNESS.
The Trustee, in its capacity as trustee under this Indenture, shall not be
deemed to owe any fiduciary duty to the holders of Senior Indebtedness and shall
not be liable to any such holders if it shall in good faith mistakenly pay over
or distribute to Holders of Securities or to the Company or to any other Person
cash, property or securities to which any holders of Senior Indebtedness shall
be entitled by virtue of this Article or otherwise.
SECTION 16.13 RIGHTS OF TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS; PRESERVATION
OF TRUSTEE'S RIGHTS.
The Trustee in its individual capacity shall be entitled to all the rights
set forth in this Article with respect to any Senior Indebtedness which may at
any time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.
Nothing in this Article shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 6.5.
SECTION 16.14 ARTICLE APPLICABLE TO PAYING AGENTS.
In case at any time any Paying Agent other than the Trustee shall have been
appointed by the Company and be then acting hereunder, the term "Trustee" as
used in this Article shall in such case (unless the context otherwise requires)
be construed as extending to and including such Paying Agent within its meaning
as fully for all intents and purposes as if such Paying Agent were named in this
Article in addition to or in place of the Trustee.
SECTION 16.15 DEFEASANCE OF THIS ARTICLE SIXTEEN.
The subordination of the Securities provided by this Article XVI is
expressly made subject to the provisions for defeasance or covenant defeasance
in Section 4.3 or Section 10.11, as the case maybe and, anything herein to the
contrary notwithstanding, upon the effectiveness of any such defeasance or
covenant defeasance, the Securities then outstanding shall thereupon cease to be
subordinated pursuant to this Article XVI.
SECTION 16.16 CERTAIN CONVERSIONS DEEMED PAYMENT.
For the purposes of this Article only, (a) the issuance and delivery of
junior securities upon conversion of Securities in accordance with Article XV
shall not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any) or interest on Securities or on account of the
purchase or other acquisition of Securities, and (b) the payment, issuance or
delivery of cash, property or securities (other than junior securities) upon
conversion of a Security shall be deemed to constitute payment on account
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of the principal of such security. For the purposes of this Section, the term
"junior securities" means (i) shares of any stock of any class of the Company
and (ii) securities of the Company which are subordinated in right of payment to
all Senior Indebtedness which may be outstanding at the time of issuance or
delivery of such securities to substantially the same extent as, or to a greater
extent than, the Securities are so subordinated as provided in this Article.
Nothing contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Company, its creditors
other than holders of Senior Indebtedness and the Holders of the Securities, the
right, which is absolute and unconditional, of the Holder of any Security to
convert such Security in accordance with Article XV.
----------
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
87
<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.
INTERNATIONAL PAPER COMPANY
By /s/ E. William Boehmler
----------------------------
Name: E. William Boehmler
Title: Vice President
[Seal]
Attest:
/s/ Carol Samalin
- ----------------------------------
Assistant Secretary
The Bank of New York
By /s/ Mary LaGumina
----------------------------
Mary LaGumina
Assistant Vice President
[Seal]
Attest:
/s/ Remo Reale
- ----------------------------------
Assistant Secretary
88
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 24th day of September, 1998, before me personally came E.W.
Boehmler, to me known, who, being by me duly sworn, did depose and say that he
is VP & Treasurer of International Paper 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/ Annabella Cascone [Seal]
---------------------------
Notary Public, State of New York
Qualified in New York County
--------------------------
No. 01CA5033938
---------------------------------------
Commission Expires Sept. 26, 1998
---------------------
89
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 24th day of September, 1998, before me personally came
M. LaGumina, to me known, who, being by me duly sworn, did depose and say that
she is Assistant VP & Treasurer of The Bank of New York, 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/ Annabella Cascone [Seal]
---------------------------
Notary Public, State of New York
Qualified in New York County
--------------------------
No. 01CA5033938
---------------------------------------
Commission Expires Sept. 26, 1998
--------------------
90
<PAGE>
EXHIBIT A
[FORM OF REGISTERED SECURITY WHICH IS NOT AN
ORIGINAL ISSUE DISCOUNT SECURITY]
[FORM OF FACE]
INTERNATIONAL PAPER COMPANY
No. [R-] [U.S.]$
International Paper Company, a corporation duly organized and existing
under the laws of New York (herein called the "Company", which term includes any
successor Person under the Indenture referred to on the reverse hereof), for
value received, hereby promises to pay to ___________ or registered assigns, the
principal sum of __________ [United States] Dollars on _________, and to pay
interest thereon from _______, ___ or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, [semi-annually in arrears
on __________ and __________ in each year] [annually in arrears on __________ in
each year], commencing ________, ___, 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 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 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 in _______, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts] [the option of the Holder (a) 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 in The City of New York, 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
A-1
<PAGE>
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 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 [United States dollar] 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)].
The indebtedness evidenced by this Security is, to the extent provided in
the Indenture, subordinate and subject in right of payment to the prior payment
in full of all Senior Indebtedness, and this Security is issued subject to the
provisions of the Indenture with respect thereto. Each Holder of this Security,
by accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination so provided and (c)
appoints the Trustee his attorney-in-fact for any and all such purposes.
[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 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;
A-2
<PAGE>
(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 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
A-3
<PAGE>
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:____________________________
INTERNATIONAL PAPER COMPANY
[Seal] By_____________________________________
Attest:
__________________________________
A-4
<PAGE>
[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 15, 1998(herein called the
"Indenture"), between the Company and The Bank of New York, 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 [If the Securities of the series are also issuable as Bearer
Securities, insert--and any coupons appertaining thereto] 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 [U.S.]$_____]. [If the Securities of the series
are also issuable as Bearer Securities, insert--The Securities of this series
are issuable as Bearer Securities [, with interest coupons attached,] in the
denomination of U.S.$__________, and as Registered Securities, without coupons,
in denominations of U.S.$__________ and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Bearer Securities and 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. Registered Securities
may not be exchanged for Bearer Securities.]
[If applicable, insert--The Securities of this series are subject to
redemption [(1)] [If applicable, insert--on _______ 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 _____,___], 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,
<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 instalments of
interest on this Security whose Stated Maturity is on or prior to such
A-5
<PAGE>
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 _________, ___], 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 Date;
PROVIDED, HOWEVER, that instalments 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.]
Subject to and upon compliance with the provisions of the Indenture (unless
previously redeemed), this Security, if submitted for redemption, is subject to
redemption, at the option of the Holder, [If Securities of the series are
issuable as Bearer Securities, insert--on or after the Exchange Date] upon any
Change in Control of the Company (as defined in the Indenture) unless the
Continuing Directors, as defined in the Indenture, shall have
A-6
<PAGE>
approved such Change in Control [If applicable, insert--or the Company shall
have called the Securities for redemption at the applicable Redemption Price for
redemption at the option of the Company, in either case] on or before the day
which is ten days after such Change in Control [If applicable, insert--(whether
or not such call occurs before or after such Change in Control)]. The Holder's
option so to redeem is exercisable on or before the end of the Exercise Period
specified in the notice of the Company relating to such Change in Control at a
Redemption Price equal to 100% of the principal amount hereof plus accrued
interest to the Redemption Date. For this Security to be submitted for such
redemption, the Company must receive at the office of one of the Paying Agents,
prior to the close of business on the last day of such Exercise Period, this
Security [If Securities of the series are issuable as Bearer Securities,
insert--together with all coupons maturing after the Redemption Date,]
accompanied by written notice to the Company (which shall be substantially in
the form of the [appropriate] form of notice hereon) that the Holder hereof
instructs the Company to redeem this Security. [If Securities of the series are
issuable as Bearer Securities, insert--The Holder of this Security may elect to
submit for redemption by the Company such Security as a whole but not in part.]
Such notice duly received shall be irrevocable.
[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 ____________, __, 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.]
[If the Securities of the series are also issuable as Bearer Securities and
if applicable,* insert--In addition, if the Company determines, based upon a
written opinion of independent counsel, that any payment made outside the
- ----------
* Generally this provision will only be applicable if the Securities of the
series bear interest at a fixed rate.
A-7
<PAGE>
United States by the Company or any of its Paying Agents of the full amount of
principal, [premium, if any,] or interest due with respect to any Bearer
Security or coupon would, under any present or future laws or regulations of the
United States, be subject to any certification, identification or other
information reporting requirement of any kind, the effect of which requirement
is the disclosure to the Company, any Paying Agent or any governmental authority
of the nationality, residence or identity of a beneficial owner of such Bearer
Security or coupon who is a United States Alien (as defined on the face hereof)
(other than such a requirement (a) which would not be applicable to a payment
made by the Company or any one of its Paying Agents (i) directly to the
beneficial owner or (ii) to any custodian, nominee or other agent of the
beneficial owner, or (b) which can be satisfied by the custodian, nominee or
other agent certifying that the beneficial owner is a United States Alien,
provided in each case referred to in clauses (a)(ii) and (b)__________________
that payment by such custodian, nominee or other agent of such beneficial owner
is not otherwise subject to any such requirement), the Company at its election
will either (x) redeem the Securities of this series, as a whole but not in
part, at a Redemption Price equal to 100% of their principal amount, together
with interest accrued to the date fixed for redemption, or (y) if and so long as
any such certification, identification or other information reporting
requirement would be fully satisfied by payment of a backup withholding tax or
similar charge, pay to the Holders of Bearer Securities who are United States
Aliens certain additional amounts specified in the Bearer Securities of this
series. The Company will make such determination and election and notify the
Trustee thereof as soon as practicable, and the Trustee will promptly give
notice of such determination in the manner provided below (the "Determination
Notice"), in each case stating the effective date of such certification,
identification or other information reporting requirement, whether the Company
will redeem the Securities or will pay to the Holders of Bearer Securities who
are United States Aliens the additional amounts specified in the Bearer
Securities of this series and (if applicable) the last date by which the
redemption of the Securities must take place. If the Company elects to redeem
the Securities, such redemption shall take place on such date, not later than
one year after publication of the Determination Notice, as the Company elects by
notice to the Trustee at least 75 days before such date, unless shorter notice
is acceptable to the Trustee. Notwithstanding the foregoing, the Company will
not so redeem the Securities if the Company, based upon an opinion of
independent counsel, subsequently determines, not less than 30 days prior to the
date fixed for redemption, that subsequent payments would not be subject to any
such requirement, in which case the Company will notify the Trustee, which will
promptly give notice of that determination in the manner provided below, and any
earlier redemption notice will thereupon be revoked and of no further effect. If
the Company elects as provided in clause (y) above to pay such additional
amounts to the Holders of Bearer Securities who are United States Aliens, and as
long as the Company is obligated to pay such additional amounts to such Holders,
the Company may subsequently redeem the Securities, at any time, as a whole but
not in part, at a Redemption Price equal to 100% of their principal amount,
together with interest accrued to the date fixed for _redemption, but without
reduction for applicable United States withholding taxes.]
A-8
<PAGE>
[If applicable, insert -The sinking fund for this series provides for the
redemption on ______ in each year, beginning with the year ____ and ending with
the year ____, of [not less than] [U.S.]$_____ [("mandatory sinking fund") and
not more than [U.S.]$_______] 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 [If Securities of
the series are also issuable as Bearer Securities, insert--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 [If
Securities of the series are also issuable as Bearer Securities,
insert--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.
[If the Security is convertible into Common Stock of the Company, insert-
Subject to the provisions of the Indenture, the Holder of this Security is
entitled, at its option, at any time on or before [insert date] (except that, in
case this Security or any portion hereof shall be called for redemption, such
right shall terminate with respect to this Security or portion hereof, as the
case may be, so called for redemption at the close of business on the date fixed
for redemption as provided in the Indenture unless the Company defaults in
making the payment due upon redemption), to convert the principal amount of this
Security (or any portion hereof which is [insert minimum denomination] or an
integral multiple thereof), into fully paid and non-assessable shares
(calculated as to each conversion to the nearest 1/100th of a share) of the
Common Stock of the Company, as said shares shall be constituted at the date of
conversion, at the conversion price of $_____ principal amount of Securities for
each share of Common Stock, or at the adjusted conversion price in effect at the
date of conversion determined as provided in the Indenture, upon surrender of
this Security, together with the conversion notice hereon duly executed, to the
Company at the designated office or agency of the Company in _______,
accompanied (if so required by the Company) by instruments of transfer, in form
satisfactory to the Company and to the Trustee, duly executed by the Holder or
by its duly authorized attorney in writing. Such surrender shall, if made during
any period beginning at the close of business on a Regular Record Date and
ending at the opening of business on the Interest Payment Date next following
such Regular Record Date (unless this Security or the portion being converted
shall have been called for redemption on a Redemption Date during such period),
also be accompanied by payment in funds acceptable to the Company of an amount
equal to the interest payable on such Interest Payment Date on the principal
amount of this Security then being converted. Subject to the aforesaid
requirement of repayment and, in the case of a conversion after the Regular
Record Date next preceding any Interest Payment Date and on or before such
Interest Payment
A-9
<PAGE>
Date, to the right of the Holder of this Security (or any Predecessor Security)
of record at such Regular Record Date to receive an installment of interest
(with certain exceptions provided in the Indenture), no adjustment is to be made
of conversion for interest accrued hereon for dividends on shares of Common
Stock issued on conversion. The Company is not required to issue fractional
shares upon any such conversion, but shall make adjustment therefor in cash on
the basis of the current market value of such fractional interest as provided in
the Indenture. The conversion price is subject to adjustment as provided in the
Indenture. In addition, the Indenture provides that in case of certain
consolidations or mergers to which the Company is a party or the sale of
substantially all of the assets of the Company, the Indenture shall be amended,
without the consent of any Holders of Securities, so that this Security, if then
outstanding, will be convertible thereafter, or during the period this Security
shall be convertible as specified above, only into the kind and amount of
securities, cash and other property receivable upon the consolidation, merger or
sale by a holder of the number of shares of Common Stock into which this
Security might have been converted immediately prior to such consolidation,
merger or sale (assuming such holder of Common Stock failed to exercise any
rights or election and received per share the kind and amount received per share
by a plurality of non-electing shares) [, assuming if such consolidation, merger
or sale is prior to ________, ____, that this Security was convertible at the
time of such consolidation, merger or sale at the initial conversion price
specified above as adjusted from __________, ___, to such time pursuant to the
Indenture]. In the event of conversion of this Security in part only, a new
Security or Securities for the unconverted portion hereof shall be issued in the
name of the Holder hereof upon the cancellation hereof.]
[If the Security is convertible into other securities of the Company,
specify the conversion features.]
[The Indenture contains provisions for defeasance of the entire
indebtedness of this Security 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 [If Securities of the series are also issuable as Bearer Securities,
insert--and any related coupons] under the Indenture at any time by the Company
and the Trustee with the consent of the Holders of 66-2/3% in principal amount
of the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such
A-10
<PAGE>
series [If Securities of the series are also issuable as Bearer Securities,
insert--and any related coupons], 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
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 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, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Company in [any place where the principal of [(and premium, if
any)] and interest on this Security are payable] [The City of New York, or,
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 transfer agent, at the [main] offices of ____ in _____ and _____ in _____
or at such other offices or agencies as the Company may designate], 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 [if the Securities of the series are also issuable as Bearer
Securities, insert--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.
A-11
<PAGE>
[If the Securities of the series are not also issuable as Bearer
Securities, insert--The Securities of this series are issuable only in
registered form, without coupons, in denominations of $__________ and any
integral multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination, as requested by the Holder surrendering
the same.]
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security is overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
[If the Securities of the Series are also issuable as Bearer Securities,
insert--The Indenture, the Securities and any coupons appertaining thereto shall
be governed by and construed in accordance with the laws of the State of New
York.]
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
A-12
<PAGE>
FORM OF NOTICE OF REDEMPTION AT HOLDER'S OPTION
To: INTERNATIONAL PAPER COMPANY
The undersigned Holder of this Security hereby irrevocably instructs the
Company to redeem this Security in accordance with the terms of the Indenture
referred to in this Security.
The instruction being given in exercise of the Holder's option to require
redemption of this Security to the extent provided in such Indenture upon a
Change in Control of the Company.
Dated:________________
----------------------------------
Signature
If only a portion of this Security is
submitted for redemption, please indicate:
1. Principal Amount submitted for redemption:
U.S.$_________________
2. Amount and denomination of Registered
Securities representing principal
amount of this Security not submitted
for redemption to be issued:
Amount: U.S.$____________
Denominations:
U.S.$_____________________
(U.S.$5,000 or an integral multiple thereof)
Note: Exercise of the option to require redemption is irrevocable.
A-13
<PAGE>
FORM OF CONVERSION NOTICE
To: INTERNATIONAL PAPER COMPANY:
The undersigned owner of this Security hereby irrevocably exercises the
option to convert this Security, or portion hereof (which is U.S. $________
[INSERT MINIMUM DENOMINATION] or an integral multiple thereof) below designated,
into shares of Common Stock of the Company in accordance with the terms of the
Indenture referred to in this Security, and directs that the shares issuable and
deliverable upon the conversion, together with any check in payment for
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. If this Notice is being delivered on a
date after the close of business on a Regular Record Date and prior to the
opening of business on the related Interest Payment Date (unless this Security
or the portion thereof being converted has been called for redemption on a
Redemption Date within such period), this Notice is accompanied by payment, in
funds acceptable to the Company, of an amount equal to the interest payable on
such Interest Payment Date of the principal of this Security to be converted. If
shares are to be issued in the name of a person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect hereto. Any amount
required to be paid by the undersigned on account of interest accompanies this
Security.
Principal Amount to be Converted
(in an integral multiple of
U.S. $_______ [INSERT MINIMUM
DENOMINATION], if less than all):
U.S. $_______
Dated:
-----------------------
----------------------------------------
Signature(s) must be guaranteed by a
commercial bank or trust company or a
member firm of a national stock exchange
if shares of Common Stock are to be
delivered, or Securities to be issued,
other than to and in the name of the
registered owner.
----------------------------------------
Signature Guaranty
A-14
<PAGE>
Fill in for registration of shares of Common Stock and Security if to be
issued otherwise than to the registered holder.
_____________________________ Social Security or other (NAME)
Taxpayer Identification Number
--------------
- -----------------------------
(ADDRESS)
- -----------------------------
PLEASE PRINT NAME AND
ADDRESS (INCLUDING ZIP
CODE NUMBER)
[The above Conversion Notice is to be modified, as appropriate, for conversion
into other securities of the Company.]
A-15
<PAGE>
EXHIBIT B
[FORM OF REGISTERED SECURITY WHICH IS AN
ORIGINAL ISSUE DISCOUNT SECURITY]
[FORM OF FACE]
FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE UNITED STATES INTERNAL REVENUE
CODE, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT ON THIS SECURITY IS ____% OF ITS
PRINCIPAL AMOUNT, THE ISSUE DATE IS ___________, ____ [,--AND] THE YIELD TO
MATURITY IS ____% [, THE METHOD USED TO DETERMINE THE YIELD IS -----------].
INTERNATIONAL PAPER COMPANY
No. [R-] [U.S.]$
International Paper Company, a corporation duly organized and existing under
the laws of New York (herein called the "Company", which term includes any
successor Person under the Indenture referred to on the reverse hereof), for
value received, hereby promises to pay to _____________________, or registered
assigns, the principal sum of ______________________________ [United States]
Dollars on _____________________ [If the Security is interest-bearing, insert--,
and to pay interest thereon from ___________, ____ or from the most recent
Interest Payment Date to which interest has been paid or duly provided for,
[semi-annually in arrears on ________________ and in each year] [annually in
arrears on _____________________ in each year], commencing _______, ___, 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 principal [and premium] and on any overdue instalment 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 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
B-1
<PAGE>
required by such exchange, all as more fully provided in said Indenture]. [If
the Security is not to bear interest prior to Maturity, insert--The principal of
this Security shall not bear interest except in the case of a default in payment
of the principal upon acceleration, upon redemption or at Stated Maturity, and
in such case the overdue principal of this Security 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 principal has been made or duly provided
for. Interest on any overdue principal shall be payable on demand. Any such
interest on any overdue principal 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 the
principal of [(and premium, if any)] and [If applicable, insert--any such]
interest on this Security will be made at [the office or agency of the Company
maintained for that purpose in ______, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts] [the option of the Holder (a) 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 in The City of New York, 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 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
[United States dollar] 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)].
The indebtedness evidenced by this Security is, to the extent provided in
the Indenture, subordinate and subject in right of payment to the prior payment
in full of all Senior Indebtedness, and this Security is issued subject to the
provisions of the Indenture with respect thereto. Each Holder of this Security,
by accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination so provided and (c)
appoints the Trustee his attorney-in-fact for any and all such purposes.
[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
B-2
<PAGE>
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, interest--(i) the net
payment of principal of (and interest on overdue principal, if any, on) this
Security and (ii) the net proceeds from the sale or exchange of this Security,
including, in each case, amounts received 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, 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;
B-3
<PAGE>
(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
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 [If the
Security is interest-bearing, insert--principal of [(and premium, if any)] or
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 of the proceeds of any sale or exchange of 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-4
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
----------------------
INTERNATIONAL PAPER COMPANY
[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 15,1998 (herein called the
"Indenture"), between the Company and The Bank of New York, 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 [If the Securities of the series are also issuable as Bearer
Securities, insert--and any coupons appertaining thereto] 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 [U.S.]$______]. [If Securities of the series are
issuable as Bearer Securities, insert--The Securities of this series are
issuable as Bearer Securities [, with interest coupons attached,] in the
denomination of U.S.$__________, and as Registered Securities, without coupons,
in denominations of U.S.$__________ and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Bearer Securities and 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. Registered Securities
may not be exchanged for Bearer Securities.]
[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] (2)] [If applicable, insert--at any time [on or
B-5
<PAGE>
after ____________, ____], 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,
<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 [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 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 ___________________, ____], 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 [Insert formula
B-6
<PAGE>
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.]
Subject to and upon compliance with the provisions of the Indenture (unless
previously redeemed), this Security, if submitted for redemption, is subject to
redemption, at the option of the Holder, [If Securities of the series are also
issuable as Bearer Securities, insert--on or after the Exchange Date] (upon any
Change in Control of the Company (as defined in the Indenture) unless the
Continuing Directors, as defined in the Indenture, shall have approved such
Change in Control [If applicable, insert--or the Company shall have called the
Securities for redemption at the applicable Redemption Price for redemption at
the option of the Company, in either case] on or before the day which is ten
days after such Change in Control [If applicable, insert--(whether or not such
call occurs before or after such Change in Control)]. The Holder's option so to
redeem is exercisable on or before the end of the Exercise Period specified in
the notice of the Company relating to such Change in Control at a Redemption
Price equal to 100% of the principal amount hereof plus accrued interest to the
Redemption Date. For this Security to be submitted for such redemption, the
Company must receive at the office of one of the Paying Agents, prior to the
close of business on the last day of such Exercise Period, this Security [If
Securities of the series are also issuable as Bearer Securities,
insert--together with all coupons maturing after the Redemption Date,]
accompanied by written notice to the Company (which shall be substantially in
the form of the [appropriate] form of notice hereon) that the Holder hereof
instructs the Company to redeem this Security. [If Securities of the series
are also issuable as Bearer Securities, insert--The Holder of this Security may
elect to submit for redemption by the Company such Security as a whole but not
in part.] Such notice duly received shall be irrevocable.
[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
B-7
<PAGE>
such laws or regulations, which amendment or change is effective on or after
___________, ____, 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 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.]
[If the Securities of the series are also issuable as Bearer Securities and
if applicable,* insert--In addition, if the Company determines, based upon a
written opinion of independent counsel, that any payment made outside the United
States by the Company or any of its Paying Agents of the full amount of
principal, [premium, if any,] or interest due with respect to any Bearer
Security or coupon would, under any present or future laws or regulations of the
United States, be subject to any certification, identification or other
information reporting requirement of any kind, the effect of which requirement
is the disclosure to the Company, any Paying Agent or any governmental authority
of the nationality, residence or identity of a beneficial owner of such Bearer
Security or coupon who is a United States Alien (as defined on the face hereof)
(other than such a requirement (a) which would not be applicable to a payment
made by the Company or any one of its Paying Agents (i) directly to the
beneficial owner or (ii) to any custodian, nominee or other agent of the
beneficial owner, or (b) which can be satisfied by the custodian, nominee or
other agent certifying that the beneficial owner is a United States Alien,
provided in each case referred to in clauses (a)(ii) and (b) that payment by
such custodian, nominee or other agent of such beneficial owner is not otherwise
subject to any such requirement), the Company at its election will either (x)
redeem the Securities of this series, as a whole but not in part, at a
Redemption Price determined as set forth in the next preceding paragraph,
together with interest accrued to the date fixed for redemption, or (y) if and
so long as any such certification, identification or other information reporting
requirement would be fully satisfied by payment of a backup withholding tax or
similar charge, pay to the Holders of Bearer Securities who are United States
Aliens certain additional amounts specified in the Bearer
- --------
* This provision will only be applicable if the Securities of the series are
interest-bearing and generally only if the Securities bear interest at a
fixed rate.
B-8
<PAGE>
Securities of this series. The Company will make such determination and election
and notify the Trustee thereof as soon as practicable, and the Trustee will
promptly give notice of such determination in the manner provided below (the
"Determination Notice"), in each case stating the effective date of such
certification, identification or other information reporting requirement,
whether the Company will redeem the Securities or will pay to the Holders of
Bearer Securities who are United States Aliens the additional amounts specified
in the Bearer Securities of this series and (if applicable) the last date by
which the redemption of the Securities must take place. If the Company elects to
redeem the Securities, such redemption shall take place on such date, not later
than one year after publication of the Determination Notice, as the Company
elects by notice to the Trustee at least 75 days before such date, unless
shorter notice is acceptable to the Trustee. Notwithstanding the foregoing, the
Company will not so redeem the Securities if the Company, based upon an opinion
of independent counsel, subsequently determines, not less than 30 days prior to
the date fixed for redemption, that subsequent payments would not be subject to
any such requirement, in which case the Company will notify the Trustee, which
will promptly give notice of that determination in the manner provided below,
and any earlier redemption notice will thereupon be revoked and of no further
effect. If the Company elects as provided in clause (y) above to pay such
additional amounts to the Holders of Bearer Securities who are United States
Aliens, and as long as the Company is obligated to pay such additional amounts
to such Holders, the Company may subsequently redeem the Securities, at any
time, as a whole but not in part, at a Redemption Price determined as set forth
in the next preceding paragraph, together with interest accrued to the date
fixed for redemption, but without reduction for applicable United States
withholding taxes.]
[If applicable,* insert--In addition, if the Company determines, based upon
a written opinion of independent counsel, that any payment made outside the
United States by the Company or any of its Paying Agents of the full amount due
with respect to any Bearer Security would, under any present or future laws or
regulations of the United States, be subject to any certification,
identification or other reporting requirement of any kind, the effect of which
requirement is the disclosure to the Company, any Paying Agent or any
governmental authority of the nationality, residence or identity of a beneficial
owner of such Bearer Security who is a United States Alien (as defined on the
face hereof) (other than such requirement (a) which would not be applicable to a
payment made by the Company or any one or its Paying Agents (i) directly to the
beneficial owner or (ii) to any custodian, nominee or other agent of the
beneficial owner, or (b) which can be satisfied by the custodian, nominee or
other agent certifying to the effect that such beneficial owner is a United
States Alien, provided in each case referred to in clauses (a)(ii) and (b) that
payment by such custodian, nominee or other agent of such beneficial owner is
not otherwise subject to any such requirement), the Company at its election will
either (x) permit any Holder of a Bearer Security
--------
* This provision will only be applicable if the Securities of the series are
not to bear interest prior to Maturity.
B-9
<PAGE>
to present such Bearer Security for redemption within 90 days of notice of such
redemption, at a Redemption Price determined as set forth in the next preceding
paragraph, or (y) if and so long as the conditions of the fifth paragraph on the
face of this Security are satisfied, pay the additional amounts specified in
such paragraph. The Company will make such determination and election and notify
the Trustee thereof as soon as practicable, and the Trustee will promptly give
notice of such determination in the manner provided below (the "Determination
Notice"), in each case stating the effective date of such certification,
identification or other reporting requirement, whether the Company has elected
to permit redemption of the Bearer Securities or to pay the additional amounts
specified in such paragraph and (if applicable) the last day by which the
Company may publish any notice of redemption. If the Company elects to permit
redemption of the Bearer Securities, notice of the redemption will be given not
more than 268 days following the Determination Notice and will specify the date
fixed for redemption. The Bearer Securities will be redeemed on the day 97 days
after notice of the redemption has been given. Notwithstanding the foregoing,
the Company will not permit redemption of the Bearer Securities if the Company,
based upon an opinion of independent counsel, subsequently determines, not less
than 30 days prior to the date fixed for redemption, that no payment would be
subject to any such requirement, in which case the Company will promptly notify
the Trustee, which will promptly give notice of that determination in the manner
described below, and any earlier redemption notice will thereupon be revoked and
of no further effect.]
[If applicable, insert--The sinking fund for this series provides for the
redemption on _______________ in each year, beginning with the year ____ and
ending with the year ____ of [not less than] [U.S.]$______[("mandatory sinking
fund") and not more than [U.S.]$______] 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 [If the Securities
of the series are also issuable as Bearer Securities, insert--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 [If the
Securities of the series are also issuable as Bearer Securities,
insert--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.
[If the Security is convertible into Common Stock of the Company, insert-
Subject to the provisions of the Indenture, the Holder of this Security is
entitled, at its option, at any time on or before [insert date] (except that, in
case this Security or any portion hereof shall be called for redemption, such
right shall terminate with respect to this Security or
B-10
<PAGE>
portion hereof, as the case may be, so called for redemption at the close of
business on the date fixed for redemption as provided in the Indenture unless
the Company defaults in making the payment due upon redemption), to convert the
principal amount of this Security (or any portion hereof which is [insert
minimum denomination] or an integral multiple thereof), into fully paid and
non-assessable shares (calculated as to each conversion to the nearest 1/100th
of a share) of the Common Stock of the Company, as said shares shall be
constituted at the date of conversion, at the conversion price of $_____
principal amount of Securities for each share of Common Stock, or at the
adjusted conversion price in effect at the date of conversion determined as
provided in the Indenture, upon surrender of this Security, together with the
conversion notice hereon duly executed, to the Company at the designated office
or agency of the Company in _______, accompanied (if so required by the Company)
by instruments of transfer, in form satisfactory to the Company and to the
Trustee, duly executed by the Holder or by its duly authorized attorney in
writing. Such surrender shall, if made during any period beginning at the close
of business on a Regular Record Date and ending at the opening of business on
the Interest Payment Date next following such Regular Record Date (unless this
Security or the portion being converted shall have been called for redemption on
a Redemption Date during such period), also be accompanied by payment in funds
acceptable to the Company of an amount equal to the interest payable on such
Interest Payment Date on the principal amount of this Security then being
converted. Subject to the aforesaid requirement of repayment and, in the case of
a conversion after the Regular Record Date next preceding any Interest Payment
Date and on or before such Interest Payment Date, to the right of the Holder of
this Security (or any Predecessor Security) of record at such Regular Record
Date to receive an installment of interest (with certain exceptions provided in
the Indenture), no adjustment is to be made of conversion for interest accrued
hereon for dividends on shares of Common Stock issued on conversion. The Company
is not required to issue fractional shares upon any such conversion, but shall
make adjustment therefor in cash on the basis of the current market value of
such fractional interest as provided in the Indenture. The conversion price is
subject to adjustment as provided in the Indenture. In addition, the Indenture
provides that in case of certain consolidations or mergers to which the Company
is a party or the sale of substantially all of the assets of the Company, the
Indenture shall be amended, without the consent of any Holders of Securities, so
that this Security, if then outstanding, will be convertible thereafter, during
the period this Security shall be convertible as specified above, only into the
kind and amount of securities, cash and other property receivable upon the
consolidation, merger or sale by a holder of the number of shares of Common
Stock into which this Security might have been converted immediately prior to
such consolidation, merger or sale (assuming such holder of Common Stock failed
to exercise any rights or election and received per share the kind and amount
received per share by a plurality of non-electing shares) [, assuming if such
consolidation, merger or sale is prior to ________, ____, that this Security was
convertible at the time of such consolidation, merger or sale at the initial
conversion price specified above as adjusted from __________, ____, to such time
pursuant to the Indenture]. In the event of conversion of this Security in part
only, a new Security or Securities for the unconverted
B-11
<PAGE>
portion hereof shall be issued in the name of the Holder hereof upon the
cancellation hereof.]
[If the Security is convertible into other securities of the Company,
specify the conversion features.]
[The Indenture contains provisions for defeasance of the entire indebtedness
of this Security upon compliance by the Company with certain condi- tions 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
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 [If the Securities of the series are also issuable as Bearer Securities
and are interest-bearing, insert--and any related coupons] under the Indenture
at any time by the Company and the Trustee with the consent of the Holders of
66-2/3% in principal amount of the Securities at the time Outstanding of each
series to be affected. The Indenture also contains provisions permitting the
Holders of specified percentages in principal amount of the Securities of each
series at the time Outstanding, on behalf of the Holders of all Securities of
such series [If Securities of the series are also issuable as Bearer Securities
and are interest-bearing, insert--and any related coupons], 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
B-12
<PAGE>
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 [any] 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
[any] interest [(including additional amounts, as described on the face hereof)]
on this Security 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 the principal of [(and premium, if
any)] and [any] interest on this Security are payable] [The City of New York,
or, 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 transfer agent, at the [main] offices of ________________ in
________________ and ________________ in ________________ or at such other
offices or agencies as the Company may designate], 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 [If the
securities of the Series are also issuable as Bearer Securities,
insert--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.
[If the Securities of the series are not issuable as Bearer Securities,
insert--The Securities of this series are issuable only in registered form,
without coupons, in denominations of $______ and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate principal
amount of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.]
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security is overdue, and neither the
B-13
<PAGE>
Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
[If the Securities of the series are also issuable as Bearer Securities,
insert--The Indenture, the Securities and any coupons appertaining thereto shall
be governed by and construed in accordance with the laws of the State of New
York.]
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
B-14
<PAGE>
FORM OF NOTICE OF REDEMPTION AT HOLDER'S OPTION
To: INTERNATIONAL PAPER COMPANY
The undersigned Holder of this Security hereby irrevocably instructs the
Company to redeem this Security in accordance with the terms of the Indenture
referred to in this Security.
The instruction being given in exercise of the Holder's option to require
redemption of this Security to the extent provided in such Indenture upon a
Change in Control of the Company.
Dated:
-----------------------
------------------------------
Signature
If only a portion of this Security is
submitted for redemption, please indicate:
1. Principal Amount submitted for redemption:
U.S.$
------------------
2. Amount and denomination of Registered
Securities representing principal
amount of this Security not submitted
for redemption to be issued:
Amount: U.S.$
-------------------
Denominations:
U.S.$
------------------
(U.S.$5,000 or an integral multiple thereof)
Note: Exercise of the option to require redemption is irrevocable.
B-15
<PAGE>
FORM OF CONVERSION NOTICE
To: INTERNATIONAL PAPER COMPANY:
The undersigned owner of this Security hereby irrevocably exercises the
option to convert this Security, or portion hereof (which is U.S. $________
[INSERT MINIMUM DENOMINATION] or an integral multiple thereof) below designated,
into shares of Common Stock of the Company in accordance with the terms of the
Indenture referred to in this Security, and directs that the shares issuable and
deliverable upon the conversion, together with any check in payment for
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. If this Notice is being delivered on a
date after the close of business on a Regular Record Date and prior to the
opening of business on the related Interest Payment Date (unless this Security
or the portion thereof being converted has been called for redemption on a
Redemption Date within such period), this Notice is accompanied by payment, in
funds acceptable to the Company, of an amount equal to the interest payable on
such Interest Payment Date of the principal of this Security to be converted. If
shares are to be issued in the name of a person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect hereto. Any amount
required to be paid by the undersigned on account of interest accompanies this
Security.
Principal Amount to be Converted
(in an integral multiple of
U.S. $_______ [INSERT MINIMUM
DENOMINATION], if less than all):
U.S. $
----------
Dated:
----------------
----------------------------------------
Signature(s) must be guaranteed by a
commercial bank or trust company or a
member firm of a national stock
exchange if shares of Common Stock
are to be delivered, or Securities to be
issued, other than to and in the name
of the registered owner.
----------------------------------------
Signature Guaranty
B-16
<PAGE>
Fill in for registration of shares of Common Stock and Security if to be
issued otherwise than to the registered holder.
- ----------------------------- Social Security or other (NAME)
Taxpayer Identification Number
------------
- -----------------------------
(ADDRESS)
- -----------------------------
PLEASE PRINT NAME AND
ADDRESS (INCLUDING ZIP
CODE NUMBER)
[The above Conversion Notice is to be modified, as appropriate, for conversion
into other securities of the Company.]
B-17
<PAGE>
EXHIBIT C
[FORM OF BEARER SECURITY WHICH IS NOT AN
ORIGINAL ISSUE DISCOUNT SECURITY AND
FORM OF RELATED COUPON]
[Form of Face of Security]
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO
LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS
PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE.
INTERNATIONAL PAPER COMPANY
No. B- U.S.$
International Paper Company, a corporation duly organized and existing under
the laws of New York (herein called the "Company", which term includes any
successor Person under the Indenture referred to on the reverse hereof), for
value received, hereby promises to pay to bearer upon presentation and surrender
of this Security the principal sum of _____Thousand United States Dollars on
_____ and to pay interest thereon, from the date hereof, [semi-annually in
arrears on ______ and _______ in each year] [annually in arrears on ______ in
each year], commencing ______, ____, 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 principal and premium
and on any overdue installment of interest]. Such payments [(including premium,
if any)] shall be made, 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 ______, and ______ in ______, or at such other
offices or agencies outside the United States (as defined below) as the Company
may designate, at the option of the Holder, by United States dollar check drawn
on a bank in The City of New York or by transfer of United States dollars to an
account maintained by the payee with a bank located outside the United States.
Interest on this Security due on or before Maturity shall be payable only upon
presentation and surrender at such an office or agency of the interest coupons
hereto attached as they severally mature. No payment of principal [, premium] or
interest on this Security shall be made at any office or agency of the Company
in the United States or by check mailed to any address in the United States or
by transfer to an account maintained with a bank located in the United States
[If Security is denominated and payable in United States dollars, insert -;
PROVIDED, HOWEVER, that payment of principal of [(and premium, if any)] and
interest on this Security (including any additional amounts which may be payable
as provided below) shall be made at the office of the Company's Paying Agent in
The City of New York if (but only if) payment in United States dollars of the
full amount of such principal, [premium,] interest or additional amounts, as the
case may be, at all offices or agencies outside the United States maintained
C-1
<PAGE>
for the purpose by the Company in accordance with the Indenture is illegal or
effectively precluded by exchange controls or other similar restrictions].
The indebtedness evidenced by this Security is, to the extent provided in
the Indenture, subordinate and subject in right of payment to the prior payment
in full of all Senior Indebtedness, and this Security is issued subject to the
provisions of the Indenture with respect thereto. Each Holder of this Security,
by such provisions, (b) authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to effectuate the subordination
so provided and (c) appoints the Trustee his attorney-in-fact for any and all
such purposes.
The Company will pay to the Holder of this Security or any coupon
appertaining hereto 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 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
or in such coupon 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 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 herein, 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 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 or any coupon appertaining hereto, if
compliance is required by statute or by regulation of the
C-2
<PAGE>
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 so imposed but for the presentation by the Holder of this Security
or any coupon appertaining hereto 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 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 or any coupon appertaining
hereto. 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 and its possessions.
[Notwithstanding the foregoing, if and so long as a certification,
identification or other information reporting requirement referred to in the
[fourth] [fifth] paragraph on the reverse hereof would be fully satisfied by
payment of a backup withholding tax or similar charge, the Company may elect, by
so stating in the Determination Notice (as defined in such paragraph), to have
the provisions of this paragraph apply in lieu of the provisions of such
paragraph. In such event, the Company will pay as additional amounts such
amounts as may be necessary so that every net payment made following the
effective date of such requirements outside the United States by the Company or
any of its Paying Agents of principal [(and premium, if any)] or interest due in
respect of any Bearer Security or any coupon of which the beneficial owner is a
United States Alien (but without any requirement that the nationality, residence
or identity of such beneficial owner by disclosed to the Company, any Paying
Agent or any governmental authority), after deduction or withholding for or on
account of such backup withholding tax or similar charge other than a backup
withholding tax or similar charge which is (i) the result
C-3
<PAGE>
of a certification, identification or other reporting requirement described in
the second parenthetical clause of such paragraph, or (ii) imposed as a result
of the fact that the Company or any of its Paying Agents has actual knowledge
that the beneficial owner of such Bearer Security or coupon is within the
category of Persons described in clause (a) of the third paragraph of this
Security, or (iii) imposed as a result of presentation of such Bearer Security
or coupon for payment more than 15 days after the date on which such payment
becomes due and payable or on which payment thereof is duly provided for,
whichever occurs later, will not be less than the amount provided for in such
Bearer Security or coupon to be then due and payable.]
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, neither this Security,
nor any coupon appertaining hereto, shall 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 and coupons bearing the facsimile signature of
[its Treasurer] [one of its Assistant Treasurers] to be annexed hereto.
Dated:
------------,------
International Paper Company
[Seal] By
Attest: -------------------------
- -------------------------
C-4
<PAGE>
[Form of Reverse of Security]
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 15, 1998 (herein called the
"Indenture"), between the Company and The Bank of New York, 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 any coupons appertaining thereto 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 of U.S.$______]. The Securities of this series are issuable as
Bearer Securities, with interest coupons attached, in the denomination of
U.S.$______ [, and as Registered Securities, without coupons, in denominations
of U.S.$______ and any integral multiple thereof]. [As provided in the Indenture
and subject to certain limitations therein set forth, Bearer Securities and
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, with all unmatured
coupons and all matured coupons in default thereto appertaining, at any office
or agency described below where Registered Securities of this series may be
presented for registration of transfer; PROVIDED, HOWEVER, that Bearer
Securities surrendered in exchange for Registered Securities between a Record
Date and the relevant Interest Payment Date shall be surrendered without the
coupon relating to such Interest Payment Date. Registered Securities may not be
exchanged for Bearer Securities.]
[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 ______, ____], 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
<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,]
[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
C-5
<PAGE>
the Redemption Date; PROVIDED, HOWEVER, that interest installments on this
Security whose Stated Maturity is on or prior to such Redemption Date will be
payable only upon presentation and surrender of coupons for such interest (at an
office or agency located outside the United States, except as herein provided
otherwise).]
[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 ________ ____], 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,
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 Date;
PROVIDED, HOWEVER, that interest installments on this Security whose Stated
Maturity is on or prior to such Redemption Date will be payable only upon
presentation and surrender of coupons for such interest (at an office or agency
located outside the Untied States, except as herein provided otherwise).]
[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.]
Subject to and upon compliance with the provisions of the Indenture
(unless previously redeemed), this Security, if submitted for redemption, is
subject to redemption, at the option of the Holder, on or after the Exchange
Date (upon any Change in Control of the Company as defined in the Indenture)
unless the Continuing Directors, as defined in the Indenture, shall have
approved such Change in Control [If applicable, insert - or the Company shall
have called the Securities for redemption at the applicable Redemption Price
C-6
<PAGE>
for redemption at the option of the Company, in either case] on or before the
day which is ten days after such Change in Control [If applicable, insert -
(whether or not such call occurs before or after such Change in Control)]. The
Holder's option so to redeem is exercisable on or before the end of the Exercise
Period specified in the notice of the Company relating to such Change in Control
at a Redemption Price equal to 100% of the principal amount hereof plus accrued
interest to the Redemption Date. For this Security to be submitted for such
redemption, the Company must receive a the office of one of the Paying Agents,
prior to the close of business on the last day of such Exercise Period, this
Security together with all coupons maturing after the Redemption Date,
accompanied by written notice to the Company (which shall be substantially in
the form of the [appropriate] form of notice hereon) that the Holder hereof
instructs the Company to redeem this Security. The Holder of this Security may
elect to submit for redemption by the Company such Security as a whole but not
in part. Such notice duly received shall be irrevocable.
The Securities 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 _____, ____, 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.
[If applicable,* insert - In addition, if the Company determines, based upon
a written opinion of independent counsel, that any payment made outside the
United States by the Company or any of its Paying Agents of the full amount of
principal [, premium, if any,] or interest due with respect to any Bearer
Security or coupon would, under any present or future laws or regulations of the
United States, be subject to any certification, identification or other
information reporting requirement of any kind, the effect of which requirement
is the disclosure to the Company, any Paying Agent or any
- --------
* Generally this provision will only be applicable if the Securities of the
series bear interest at a fixed rate.
C-7
<PAGE>
governmental authority of the nationality, residence or identity of a beneficial
owner of such Bearer Security or coupon who is a United States Alien (as defined
on the face hereof) (other than such a requirement (a) which would not be
applicable to a payment made by the Company or any of its Paying Agents (i)
directly to the beneficial owner or (ii) to any custodian, nominee or other
agent of the beneficial owner, or (b) which can be satisfied by the custodian,
nominee or other agent certifying that the beneficial owner is a United States
Alien, provided in each case referred to in clauses (a)(ii) and (b) that payment
by such custodian, nominee or other agent of such beneficial owner is not
otherwise subject to any such requirement), the Company at its election will
either (x) redeem the Securities, as a whole but not in part, at a Redemption
Price equal to 100% of their principal amount, together with interest accrued to
the date fixed for redemption, or (y) if and so long as the conditions of the
fifth paragraph on the face of this Security are satisfied, pay the additional
amounts specified in such paragraph. The Company will make such determination
and election and notify the Trustee thereof as soon as practicable, and the
Trustee will promptly give notice of such determination in the manner provided
below (the "Determination Notice"), in each case stating the effective date of
such certification, identification or other information reporting requirement,
whether the Company will redeem the Securities or will pay the additional
amounts specified in such paragraph and (if applicable) the last date by which
the redemption of the Securities must take place. If the Company elects to
redeem the Securities, such redemption shall take place on such date, not later
than one year after publication of the Determination Notice, as the Company
elects by notice to the Trustee at least 75 days before such date, unless
shorter notice is acceptable to the Trustee. Notwithstanding the foregoing, the
Company will not so redeem the Securities if the Company, based upon an opinion
of independent counsel, subsequently determines, not less than 30 days prior the
date fixed for redemption, that subsequent payments would not be subject to any
such requirement, in which case the Company will notify the Trustee, which will
promptly give notice of that determination in the manner provided below, and any
earlier redemption notice will thereupon be revoked and of no further effect. If
the Company elects as provided in clause (y) above to pay additional amounts,
and as long as the Company is obligated to pay such additional amounts, the
Company may subsequently redeem the Securities, at any time, as a whole but not
in part, at a Redemption Price equal to 100% of their principal amount, together
with interest accrued to the date fixed for redemption, but without reduction
for applicable United States withholding taxes.]
[If applicable, insert--The sinking fund for this series provides for the
redemption on _______ in each year, beginning with the year ____ and ending with
the year ____, of [not less than] U.S. $_____ [("mandatory sinking fund") and
not more than U.S. $_____] 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].]
C-8
<PAGE>
Notice of redemption will be given by publication in an authorized Newspaper
in The City of New York and, if the Securities of this series are then listed on
[The Stock Exchange of the United Kingdom and the Republic of Ireland] [the
Luxembourg Stock Exchange ] [or] any [other] stock exchange located outside the
United States and such stock exchange shall so require, in [London] [Luxembourg]
[or] in any [other] required city outside the United States or, if not
practicable, elsewhere in Europe, [and 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.
[If the Security is convertible into Common Stock of the Company, insert-
Subject to the provisions of the Indenture, the Holder of this Security is
entitled, at its option, at any time on or before [insert date] (except that, in
case this Security or any portion hereof shall be called for redemption, such
right shall terminate with respect to this Security or portion hereof, as the
case may be, so called for redemption at the close of business on the date fixed
for redemption as provided in the Indenture unless the Company defaults in
making the payment due upon redemption), to convert the principal amount of this
Security (or any portion hereof which is [insert minimum denomination] or an
integral multiple thereof), into fully paid and non-assessable shares
(calculated as to each conversion to the nearest 1/100th of a share) of the
Common Stock of the Company, as said shares shall be constituted at the date of
conversion, at the conversion price of $_____ principal amount of Securities for
each share of Common Stock, or at the adjusted conversion price in effect at the
date of conversion determined as provided in the Indenture, upon surrender of
this Security, together with the conversion notice hereon duly executed, to the
Company at the designated office or agency of the Company in _______,
accompanied (if so required by the Company) by instruments of transfer, in form
satisfactory to the Company and to the Trustee, duly executed by the Holder or
by its duly authorized attorney in writing. Such surrender shall, if made during
any period beginning at the close of business on a Regular Record Date and
ending at the opening of business on the Interest Payment Date next following
such Regular Record Date (unless this Security or the portion being converted
shall have been called for redemption on a Redemption Date during such period),
also be accompanied by payment in funds acceptable to the Company of an amount
equal to the interest payable on such Interest Payment Date on the principal
amount of this Security then being converted. Subject to the aforesaid
requirement of repayment and, in the case of a conversion after the Regular
Record Date next preceding any Interest Payment Date and on or before such
Interest Payment Date, to the right of the Holder of this Security (or any
Predecessor Security) of record at such Regular Record Date to receive an
installment of interest (with certain exceptions provided in the Indenture), no
adjustment is to be made of conversion for interest accrued hereon for dividends
on shares of Common Stock issued on conversion. The Company is not required to
issue fractional shares upon any such conversion, but shall make adjustment
therefor in cash on the basis of the current market value of such fractional
interest as provided in the Indenture. The conversion price is subject to
adjustment as provided in the Indenture. In addition, the Indenture provides
that in case of certain consolidations or mergers to which the Company is a
party or the
C-9
<PAGE>
sale of substantially all of the assets of the Company, the Indenture shall be
amended, without the consent of any Holders of Securities, so that this
Security, if then outstanding, will be convertible thereafter, during the period
this Security shall be convertible as specified above, only into the kind and
amount of securities, cash and other property receivable upon the consolidation,
merger or sale by a holder of the number of shares of Common Stock into which
this Security might have been converted immediately prior to such consolidation,
merger or sale (assuming such holder of Common Stock failed to exercise any
rights or election and received per share the kind and amount received per share
by a plurality of non-electing shares) [, assuming if such consolidation, merger
or sale is prior to ________, ___, that this Security was convertible at the
time of such consolidation, merger or sale at the initial conversion price
specified above as adjusted from __________, ___, to such time pursuant to the
Indenture]. In the event of conversion of this Security in part only, a new
Security or Securities for the unconverted portion hereof shall be issued in the
name of the Holder hereof upon the cancellation hereof.] [If the Security is
amortized into other securities of the Company, specify conversion features.]
[The Indenture contains provisions for 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 and any related coupons under the Indenture at any time by the Company
and the Trustee with the consent of the Holders of 66 2/3% in principal amount
of the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the
Outstanding, on behalf of the Holders of all Securities of such series and any
related coupons 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 any coupon appertaining hereto and of any Security issued in
exchange hereof 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 or any related coupon 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
C-10
<PAGE>
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 apply
to a suit instituted by the Holder hereof or any related coupon for the
enforcement of payment of the principal of [(and premium, if any)] or any
interest on this Security or payment of such coupon on or after the respective
due dates expressed herein or in such coupon.
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
any interest (including additional amounts, as described on the face hereof) on
this Security at the times, places and rate, and in the coin or currency, herein
prescribed.
Title to [Bearer] Securities and coupons shall pass by delivery. [As
provided in the Indenture and subject to certain limitations therein set forth,
the transfer of Registered Securities is registrable in the Security Register,
upon surrender of a Registered Security for registration of transfer at the
[Corporate Trust Office of the Trustee or such other office or agency of the
Company as may be designated by it in The City of New York, or 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 transfer
agent, at the [main] office of _________ in __________ and ________ in ________
or at such other offices or agencies as the Company may designate, 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 thereof 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.]
[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.]
The Company, the Trustee and any agent of the Company or the Trustee may
treat the bearer of a Bearer Security of any series and any coupon appertaining
thereto [, and 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 in whose name such Security is
registered,] as the owner thereof for all purposes, whether or not such Security
or such coupon is overdue, and neither the Company, the Trustee nor any such
agent shall be affected by notice to the contrary.
C-11
<PAGE>
The Indenture, the Securities and any coupons appertaining thereto shall be
governed by and construed in accordance with the laws of the State of New York.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
C-12
<PAGE>
FORM OF NOTICE OF REDEMPTION AT HOLDER'S OPTION
To: INTERNATIONAL PAPER COMPANY
The undersigned Holder of this Security hereby irrevocably instructs the
Company to redeem this Security in accordance with the terms of the Indenture
referred to in this Security.
The instruction is being given in exercise of the Holder's option to require
redemption of this Security to the extent provided in such Indenture upon a
Change in Control of the Company.
Dated:
----------------------
----------------------------
Signature
NOTE: EXERCISE OF THE OPTION TO REQUIRE REDEMPTION IS IRREVOCABLE.
C-13
<PAGE>
FORM OF CONVERSION NOTICE
To: INTERNATIONAL PAPER COMPANY:
The undersigned owner of this Security hereby irrevocably exercises the
option to convert this Security, or portion hereof (which is U.S. $________
[INSERT MINIMUM DENOMINATION] or an integral multiple thereof) below designated,
into shares of Common Stock of the Company in accordance with the terms of the
Indenture referred to in this Security, and directs that the shares issuable and
deliverable upon the conversion, together with any check in payment for
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. If this Notice is being delivered on a
date after the close of business on a Regular Record Date and prior to the
opening of business on the related Interest Payment Date (unless this Security
or the portion thereof being converted has been called for redemption on a
Redemption Date within such period), this Notice is accompanied by payment, in
funds acceptable to the Company, of an amount equal to the interest payable on
such Interest Payment Date of the principal of this Security to be converted. If
shares are to be issued in the name of a person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect hereto. Any amount
required to be paid by the undersigned on account of interest accompanies this
Security.
Principal Amount to be Converted
(in an integral multiple of
U.S. $_______ [INSERT MINIMUM
DENOMINATION], if less than all):
U.S. $
-----------
Dated:
----------------
----------------------------------------
Signature(s) must be guaranteed by a
commercial bank or trust company or a
member firm of a national stock
exchange if shares of Common Stock
are to be delivered, or Securities to be
issued, other than to and in the name
of the registered owner.
----------------------------------------
Signature Guaranty
C-14
<PAGE>
Fill in for registration of shares of Common Stock and Security if to be
issued otherwise than to the registered holder.
- ----------------------------- Social Security or other (NAME)
Taxpayer Identification Number
------------
- -----------------------------
(ADDRESS)
- -----------------------------
PLEASE PRINT NAME AND
ADDRESS (INCLUDING ZIP
CODE NUMBER)
[The above Conversion Notice is to be modified, as appropriate, for conversion
into other Securities of the Company.]
C-15
<PAGE>
[Form of Face of Coupon]
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO
LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS
PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE.
INTERNATIONAL PAPER COMPANY
U.S.$ Due
----------- ---------
Unless the Security to which this coupon appertains shall have been called
for previous redemption and payment thereof duly provided for on the date set
forth hereon, International Paper Company (herein called the "Company") will pay
to bearer, upon surrender hereof, the amount shown hereon (together with any
additional amounts in respect thereof which the Company may be required to pay
according to the terms of said Security and the Indenture referred to therein)
at the Paying Agents set out on the reverse hereof or at such other offices or
agencies (which, except as otherwise provided in the Security to which this
coupon appertains, shall be located outside the United States of America
(including the States and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction (the "United States"))
as the Company may designate from time to time, at the option of the Holder, by
United States dollar check drawn on the bank in The City of New York or by
transfer of United States dollars to an account maintained by the payee with a
bank located outside the United States, being [one year's] interest then payable
on the said Security.
INTERNATIONAL PAPER COMPANY
By
[Reverse of Coupon]*
------------------------------
------------------------------
------------------------------
------------------------------
- ----------
* Insert names and addresses of initial Paying Agents located outside the
United States.
C-16
<PAGE>
EXHIBIT D
[FORM OF BEARER SECURITY WHICH IS AN
ORIGINAL ISSUE DISCOUNT SECURITY
AND FORM OF RELATED COUPON]
[Form of Face of Security]
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO
LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS
PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE. FOR
PURPOSES OF SECTIONS 1273 AND 1275 OF THE UNITED STATES INTERNAL REVENUE CODE,
THE AMOUNT OF ORIGINAL ISSUE DISCOUNT ON THIS SECURITY IS % OF ITS PRINCIPAL
AMOUNT, THE ISSUE DATE IS , ____ [,--AND THE YIELD TO MATURITY IS __%].
INTERNATIONAL PAPER COMPANY
No. B- U.S.$
International Paper Company, a corporation duly organized and existing under
the laws of New York (herein call the "Company", which term includes any
successor Person under the Indenture referred to on the reverse hereof), for
value received, hereby promises to pay to bearer upon presentation and surrender
of this Security the principal sum of _________ Thousand United States Dollars
on .
[If the Security is interest-bearing, insert--, and to pay interest thereon,
from the date hereof, [semi-annually in arrears on and in each year] [annually
in arrears on in each year], commencing ______, ____, 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 principal
and premium and on any overdue instalment of interest]]. [If the Security is not
to bear interest prior to Maturity, insert- - The principal of this Security
shall not bear interest except in the case of a default in payment of principal
upon acceleration, upon redemption or at Stated Maturity, and in such case the
overdue principal of this Security 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 principal has been made or duly provided for. Interest on
any overdue principal shall be payable on demand. Any such interest on any
overdue principal 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.] Such payments [(including premium, if
any)] shall be made, subject to any laws or regulations applicable thereto
D-1
<PAGE>
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 other offices or agencies outside the United States (as defined below)
as the Company may designate, at the option of the Holder, by United States
dollar check drawn on a bank in The City of New York or by transfer of United
States dollars to an account maintained by the payee with a bank located outside
the United States. [If the Security is interest-bearing, insert--Interest on
this Security due on or before Maturity shall be payable only upon presentation
and surrender at such an office or agency of the interest coupons hereto
attached as they severally mature.] No payment of principal [,--or] [premium]
[or interest] on this Security shall be made at any office or agency of the
Company in the United States or by check mailed to any address in the United
States or by transfer to an account maintained with a bank located in the United
States [If Security is denominated and payable in United States dollars,
insert--; provided, however, that payment of principal of [(and premium, if
any)] and [any] interest on this Security (including any additional amounts
which may be payable as provided below) shall be made at the office of the
Company's Paying Agent in The City of New York, if (but only if) payment in
United States dollars of the full amount of such principal [,premium] [,
interest] or additional amounts, as the case may be, at all offices or agencies
outside the United States maintained for the purpose by the Company in
accordance with the Indenture is illegal or effectively precluded by exchange
controls or other similar restrictions]. The indebtedness evidenced by this
Security is, to the extent provided in the Indenture, subordinate and subject in
right of payment to the prior payment in full of all Senior Indebtedness, and
this Security is issued subject to the provisions of the Indenture with respect
thereto. Each Holder of this Security, by accepting the same, (a) agrees to and
shall be bound by such provisions, (b) authorizes and directs the Trustee on his
behalf to take such action as may be necessary or appropriate to effectuate the
subordination so provided and (c) appoints the Trustee his attorney-in-fact for
any and all such purposes.
The Company will pay to the Holder of this Security [If the Security is
interest-bearing, insert--or any coupon appertaining hereto] who is a United
States Alien (as defined below) such additional amounts as may be necessary in
order that [If 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 principal of (and interest on overdue principal, if any, on) this Security
and (ii) the net proceeds from the sale or exchange of this Security, including,
in each case, amounts received 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 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 [If the Security is
D-2
<PAGE>
interest-bearing, insert--or in such coupon] 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, 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 the Security is interest-bearing,
insert--or any coupon appertaining hereto], if compliance is required by
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
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
D-3
<PAGE>
(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
[If the Security is interest-bearing, insert--or any coupon appertaining
hereto] 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 [If the
Security is interest-bearing, insert--principal of [(and premium, if any)] or
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 of the proceeds of any sale or exchange of 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 amount had such
beneficiary, settlor, member or beneficial owner been the Holder of this
Security [If the Security is interest-bearing, insert--or any coupon
appertaining hereto]. 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 of 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.
[Notwithstanding the foregoing, if and so long as a certification,
identification or other reporting requirement referred to in the [fourth]
[fifth] paragraph on the reverse hereof would be fully satisfied by payment of a
backup withholding tax or similar charge, the Company may elect, by so stating
in the Determination Notice (as defined in such paragraph), to have the
provisions of this paragraph apply in lieu of the provisions of such paragraph.
In such event, the Company will pay as additional amounts such amounts as may be
necessary so that every net payment made following the effective date of such
requirements outside the United States by the Company or any of its Paying
Agents of principal [(and premium, if any)] [If the Security is
interest-bearing, insert--or interest] due in respect of any Bearer Security [If
the Security is interest-bearing, insert--or any coupon] of which the beneficial
owner is a United States Alien (but without any requirement that the
nationality, residence or identity of such beneficial owner be disclosed to the
Company, any Paying Agent or any governmental authority), after deduction or
withholding for or on account of such backup withholding tax or similar charge
other than a backup withholding tax or similar charge which is (i) the result of
a certification, identification or other reporting requirement described in the
second parenthetical clause of such paragraph, or (ii) imposed as a result of
the fact that the Company or any of its Paying Agents has actual knowledge that
the beneficial owner of such Bearer Security [If the Security is
interest-bearing, insert--or coupon]
D-4
<PAGE>
is within the category of Persons described in clause (a) of the third paragraph
of this Security, or (iii) imposed as a result of presentation of such Bearer
Security [If the Security is interest-bearing, insert--or coupon] for payment
more than 15 days after the date on which such payment becomes due and payable
or on which payment thereof is duly provided for, whichever occurs later, will
not be less than the amount provided for in such Bearer Security [If the
Security is interest-bearing, insert--or coupon] to be then due and payable.]
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, neither this Security,
nor any coupon appertaining hereto, shall 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 and coupons bearing the facsimile signature of
[its Treasurer] [one of its Assistant Treasurers] to be annexed hereto.
Dated as of
-------------, ------
INTERNATIONAL PAPER COMPANY
[Seal] By
---------------------------------
Attest:
- -------------------------
D-5
<PAGE>
[Form of Reverse of Security]
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 15, 1998(herein called the
"Indenture"), between the Company and The Bank of New York, 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 any coupons appertaining thereto 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 U.S.$ ]. The Securities of this series are issuable as
Bearer Securities, with interest coupons attached, in the denomination of U.S.$
[, and as Registered Securities, without coupons, in denominations of U.S.$ and
any integral multiple thereof]. [As provided in the Indenture and subject to
certain limitations therein set forth, Bearer Securities and 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, with all unmatured coupons and
all matured coupons in default thereto appertaining, at any office or agency
described below where Registered Securities of this series may be presented for
registration of transfer; provided, however, that Bearer Securities surrendered
in exchange for Registered Securities between a Record Date and the relevant
Interest Payment Date shall be surrendered without the coupon relating to such
Interest Payment Date. Registered Securities may not be exchanged for Bearer
Securities.]
[If applicable, insert--The Securities of this series are subject to
redemption [(1)] [If applicable, insert--(1) on in any year commencing with the
year and ending with the year through operation of the sinking fund for this
series at a Redemption Price equal to [insert formula for determining the
amount], and (2)] [If applicable, insert--at any time [on or after , ], 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,
<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,] [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
D-6
<PAGE>
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 interest installments on this Security whose Stated
Maturity is on or prior to such Redemption Date will be payable only upon
presentation and surrender of coupons for such interest (at an office or agency
located outside the United States, except as herein provided otherwise)].]
[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 , ], 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, 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 interest
installments on this Security whose Stated Maturity is on or prior to such
Redemption Date will be payable only upon presentation and surrender of coupons
for such interest (at an office or agency located outside the United States,
except as herein provided otherwise)].] [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.]
Subject to and upon compliance with the provisions of the Indenture (unless
previously redeemed), this Security, if submitted for redemption, is subject to
redemption, at the option of the Holder, on or after the Exchange
D-7
<PAGE>
Date (upon any Change in Control of the Company as defined in the Indenture)
unless the Continuing Directors, as defined in the Indenture, shall have
approved such Change in Control [If applicable, insert--or the Company shall
have called the Securities for redemption at the applicable Redemption Price for
redemption at the option of the Company, in either case] on or before the day
which is ten days after such Change in Control [If applicable, insert--(whether
or not such call occurs before or after such Change in Control)]. The Holder's
option so to redeem is exercisable on or before the end of the Exercise Period
specified in the notice of the Company relating to such Change in Control at a
Redemption Price equal to 100% of the principal amount hereof plus accrued
interest to the Redemption Date. For this Security to be submitted for such
redemption, the Company must receive at the office of one of the Paying Agents,
prior to the close of business on the last day of such Exercise Period, this
Security together with all coupons maturing after the Redemption Date,
accompanied by written notice to the Company (which shall be substantially in
the form of the [appropriate] form of notice hereon) that the Holder hereof
instructs the Company to redeem this Security. The Holder of this Security may
elect to submit for redemption by the Company such Security as a whole but not
in part. Such notice duly received shall be irrevocable.
The Securities may be redeemed, as a whole but not in part, at the option of
the Company, at a Redemption Price determined as set forth in the preceding
paragraph [If the Security is 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 , ____, 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 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.
D-8
<PAGE>
[If applicable,* insert--In addition, if the Company determines, based upon
a written opinion of independent counsel, that any payment made outside the
United States by the Company or any of its Paying Agents of the full amount of
principal [, premium, if any,] or interest due with respect to any Bearer
Security or coupon would, under any present or future laws or regulations of the
United States, be subject to any certification, identification or other
information reporting requirement of any kind, the effect of which requirement
is the disclosure to the Company, any Paying Agent or any governmental authority
of the nationality, residence or identity of a beneficial owner of such Bearer
Security or coupon who is a United States Alien (as defined on the face hereof)
(other than such a requirement (a) which would not be applicable to a payment
made by the Company or any one of its Paying Agents (i) directly to the
beneficial owner or (ii) to any custodian, nominee or other agent of the
beneficial owner, or (b) which can be satisfied by the custodian, nominee or
other agent certifying that the beneficial owner is a United States Alien,
provided in each case referred to in clauses (a)(ii) and (b) that payment by
such custodian, nominee or other agent of such beneficial owner is not otherwise
subject to any such requirement), the Company at its election will either (x)
redeem the Securities, as a whole but not in part, at a Redemption Price
determined as set forth in the next preceding paragraph, together with interest
accrued to the date fixed for redemption, or (y) if and so long as the
conditions of the fifth paragraph on the face of this Security are satisfied,
pay the additional amounts specified in such paragraph. The Company will make
such determination and election and notify the Trustee thereof as soon as
practicable, and the Trustee will promptly give notice of such determination in
the manner provided below (the "Determination Notice"), in each case stating the
effective date of such certification, identification or other information
reporting requirement, whether the Company will redeem the Securities or will
pay the additional amounts specified in such paragraph and (if applicable) the
last date by which the redemption of the Securities must take place. If the
Company elects to redeem the Securities, such redemption shall take place on
such date, not later than one year after publication of the Determination
Notice, as the Company elects by notice to the Trustee at least 75 days before
such date, unless shorter notice is acceptable to the Trustee. Notwithstanding
the foregoing, the Company will not so redeem the Securities if the Company,
based upon an opinion of independent counsel, subsequently determines, not less
than 30 days prior to the date fixed for redemption, that subsequent payments
would not be subject to any such requirement, in which case the Company will
notify the Trustee, which will promptly give notice of that determination in the
manner provided below, and any earlier redemption notice will thereupon be
revoked and of no further effect. If the Company elects as provided in clause
(y) above to pay additional amounts, and as long as the Company is obligated to
pay such additional amounts, the Company may subsequently redeem the Securities,
at any time, as a whole but not in part, at a Redemption Price determined as set
forth in the
--------
* This provision will only be applicable if the Securities of the series are
interest-bearing and generally only if the Securities bear interest as a
fixed rate.
D-9
<PAGE>
next preceding paragraph, together with interest accrued to the date fixed for
redemption, but without reduction for applicable United States withholding
taxes.]
[If applicable,* insert--In addition, if the Company determines, based upon
a written opinion of independent counsel, that any payment made outside the
United States by the Company or any of its Paying Agents of the full amount due
with respect to any Bearer Security would, under any present or future laws or
regulations of the United States, be subject to any certification,
identification or other reporting requirement of any kind, the effect of which
requirement is the disclosure to the Company, any Paying Agent or any
governmental authority of the nationality, residence or identity of a beneficial
owner of such Bearer Security who is a United States Alien (as defined on the
face hereof) (other than such a requirement (a) which would not be applicable to
a payment made by the Company or any one of its Paying Agents (i) directly to
the beneficial owner or (ii) to any custodian, nominee or other agent of the
beneficial owner, or (b) which can be satisfied by the custodian, nominee or
other agent certifying to the effect that such beneficial owner is a United
States Alien, provided in each case referred to in clauses (a)(ii) and (b) that
payment by such custodian, nominee or other agent of such beneficial owner is
not otherwise subject to any such requirement), the Company at its election will
either (x) permit any Holder of a Bearer Security to present such Bearer
Security for redemption within 90 days of notice of such redemption, at a
Redemption Price determined as set forth in the next preceding paragraph, or (y)
if and so long as the conditions of the fifth paragraph on the face of this
Security are satisfied, pay the additional amounts specified in such paragraph.
The Company will make such determination and election and notify the Trustee
thereof as soon as practicable, and the Trustee will promptly give notice of
such determination in the manner provided below (the "Determination Notice"), in
each case stating the effective date of such certification, identification or
other reporting requirement, whether the Company has elected to permit
redemption of the Bearer Securities or to pay the additional amounts specified
in such paragraph and (if applicable) the last day by which the Company may
publish any notice of redemption. If the Company elects to permit redemption of
the Bearer Securities, notice of the redemption will be given not more than 268
days following the Determination Notice and will specify the date fixed for
redemption. The Bearer Securities will be redeemed on the day 97 days after
notice of the redemption has been given. Notwithstanding the foregoing, the
Company will not permit redemption of the Bearer Securities if the Company,
based upon an opinion of independent counsel, subsequently determines, not less
than 30 days prior to the date fixed for redemption, that no payment would be
subject to any such requirement, in which case the Company will promptly notify
the Trustee, which will promptly give notice of that determination in the manner
described below, and any earlier redemption notice will thereupon be revoked and
of no further effect.]
--------
* This provision will only be applicable if the Securities of the series are
not to bear interest prior to Maturity.
D-10
<PAGE>
[If applicable, insert--The sinking fund for this series provides for the
redemption on _____ in each year, beginning with the year _____ and ending with
the year _____ of [not less than] U.S.$ ___ [("mandatory sinking fund") and not
more than U.S.$ ___] 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 publication in an Authorized Newspaper
in The City of New York and, if the Securities of this series are then listed on
[The Stock Exchange of the United Kingdom and the Republic of Ireland] [the
Luxembourg Stock Exchange] [or] any [other] stock exchange located outside the
United States and such stock exchange shall so require, in [London] [Luxembourg]
[or] in any [other] required city outside the United States or, if not
practicable, elsewhere in Europe, [and 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.
[If the Security is convertible into Common Stock of the Company, insert-
Subject to the provisions of the Indenture, the Holder of this Security is
entitled, at its option, at any time on or before [insert date] (except that, in
case this Security or any portion hereof shall be called for redemption, such
right shall terminate with respect to this Security or portion hereof, as the
case may be, so called for redemption at the close of business on the date fixed
for redemption as provided in the Indenture unless the Company defaults in
making the payment due upon redemption), to convert the principal amount of this
Security (or any portion hereof which is [insert minimum denomination] or an
integral multiple thereof), into fully paid and non-assessable shares
(calculated as to each conversion to the nearest 1/100th of a share) of the
Common Stock of the Company, as said shares shall be constituted at the date of
conversion, at the conversion price of $_____ principal amount of Securities for
each share of Common Stock, or at the adjusted conversion price in effect at the
date of conversion determined as provided in the Indenture, upon surrender of
this Security, together with the conversion notice hereon duly executed, to the
Company at the designated office or agency of the Company in _______,
accompanied (if so required by the Company) by instruments of transfer, in form
satisfactory to the Company and to the Trustee, duly executed by the Holder or
by its duly authorized attorney in writing. Such surrender shall, if made during
any period beginning at the close of business on a Regular Record Date and
ending at the opening of business on the Interest Payment Date next following
such Regular Record Date (unless this Security or the portion being converted
shall have been called for redemption on a Redemption Date during such period),
also be accompanied by payment in funds acceptable to the Company of an amount
equal to the interest payable on such Interest Payment Date on the principal
amount of this Security then being converted. Subject to the aforesaid
requirement of repayment and, in the case of a conversion after the Regular
Record Date next preceding any Interest Payment Date and on or before such
Interest Payment Date, to the right of the Holder of this Security (or any
Predecessor
D-11
<PAGE>
Security) of record at such Regular Record Date to receive an installment of
interest (with certain exceptions provided in the Indenture), no adjustment is
to be made of conversion for interest accrued hereon for dividends on shares of
Common Stock issued on conversion. The Company is not required to issue
fractional shares upon any such conversion, but shall make adjustment therefor
in cash on the basis of the current market value of such fractional interest as
provided in the Indenture. The conversion price is subject to adjustment as
provided in the Indenture. In addition, the Indenture provides that in case of
certain consolidations or mergers to which the Company is a party or the sale of
substantially all of the assets of the Company, the Indenture shall be amended,
without the consent of any Holders of Securities, so that this Security, if then
outstanding, will be convertible thereafter, during the period this Security
shall be convertible as specified above, only into the kind and amount of
securities, cash and other property receivable upon the consolidation, merger or
sale by a holder of the number of shares of Common Stock into which this
Security might have been converted immediately prior to such consolidation,
merger or sale (assuming such holder of Common Stock failed to exercise any
rights or election and received per share the kind and amount received per share
by a plurality of non-electing shares) [, assuming if such consolidation, merger
or sale is prior to ________, ____, that this Security was convertible at the
time of such consolidation, merger or sale at the initial conversion price
specified above as adjusted from __________, ___, to such time pursuant to the
Indenture]. In the event of conversion of this Security in part only, a new
Security or Securities for the unconverted portion hereof shall be issued in the
name of the Holder hereof upon the cancellation hereof.]
[If the Security is convertible into other securities of the Company,
specify the conversion features.]
[The Indenture contains provisions for 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
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, in 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 [If the Securities of the series are interest-bearing insert--and any
related coupons] under the Indenture at any time by the Company and the
D-12
<PAGE>
Trustee with the consent of the Holders of 66 2/3% in principal amount of the
Securities at the time Outstanding of each series to be affected. The Indenture
also contains provisions permitting the Holders of specified percentages in
principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series [If the Securities of the
series are interest-bearing, insert--and any related coupons], 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 any coupon appertaining
hereto and any Security issued in exchange hereof 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 [If the Security is interest-bearing, insert--or
any related coupon] 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 apply
to a suit instituted by the Holder hereof [If the Security is interest-bearing,
insert--or any related coupon] for the enforcement of payment of the principal
of [(and premium, if any)] or [any] interest on this Security [If the Security
is interest-bearing, insert--or payment of such coupon] on or after the
respective due dates expressed herein [If the Security is interest-bearing,
insert--or in such coupon].
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
[any] interest (including additional amounts, as described on the face hereof)
on this Security at the times, places and rate, and in the coin or currency,
herein prescribed.
Title to [Bearer] Securities and coupons shall pass by delivery. [As
provided in the Indenture and subject to certain limitations therein set forth,
the transfer of Registered Securities is registrable in the Security Register,
upon surrender of a Registered Security for registration of transfer at the
[Corporate Trust Office of the Trustee or such other office or agency of the
Company as may be designated by it in The City of New York, or, 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 transfer
agent, at the [main] offices of in and in
or at such other offices or agencies as the Company may designate, duly
D-13
<PAGE>
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 thereof 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.]
[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.]
The Company, the Trustee and any agent of the Company or the Trustee may
treat the bearer of a Bearer Security of any series [If the Securities of the
series are interest-bearing, insert--and any coupon appertaining thereto] [, and
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 Security is registered,] as the owner thereof for
all purposes, whether or not such Security [If the Securities of the series are
interest-bearing, insert--or such coupon] is overdue, and neither the Company,
the Trustee nor any such agent shall be affected by notice to the contrary.
The Indenture, the Securities and any coupons appertaining thereto shall be
governed by and construed in accordance with the laws of the State of New York.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
D-14
<PAGE>
FORM OF NOTICE OF REDEMPTION AT HOLDER'S OPTION
To: INTERNATIONAL PAPER COMPANY
The undersigned Holder of this Security hereby irrevocably instructs the
Company to redeem this Security in accordance with the terms of the Indenture
referred to in this Security.
The instruction is being given in exercise of the Holder's option to require
redemption of this Security to the extent provided in such Indenture upon a
Change in Control of the Company.
Dated:
------------------
--------------------------------
Signature
Note: Exercise of the option to require redemption is irrevocable.
D-15
<PAGE>
FORM OF CONVERSION NOTICE
To: INTERNATIONAL PAPER COMPANY:
The undersigned owner of this Security hereby irrevocably exercises the
option to convert this Security, or portion hereof (which is U.S. $________
[INSERT MINIMUM DENOMINATION] or an integral multiple thereof) below designated,
into shares of Common Stock of the Company in accordance with the terms of the
Indenture referred to in this Security, and directs that the shares issuable and
deliverable upon the conversion, together with any check in payment for
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. If this Notice is being delivered on a
date after the close of business on a Regular Record Date and prior to the
opening of business on the related Interest Payment Date (unless this Security
or the portion thereof being converted has been called for redemption on a
Redemption Date within such period), this Notice is accompanied by payment, in
funds acceptable to the Company, of an amount equal to the interest payable on
such Interest Payment Date of the principal of this Security to be converted. If
shares are to be issued in the name of a person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect hereto. Any amount
required to be paid by the undersigned on account of interest accompanies this
Security.
Principal Amount to be Converted
(in an integral multiple of
U.S. $_______ [INSERT MINIMUM
DENOMINATION], if less than all):
U.S. $
-----------
Dated:
---------------------------
----------------------------------------
Signature(s) must be guaranteed by a
commercial bank or trust company or a
member firm of a national stock
exchange if shares of Common Stock
are to be delivered, or Securities to be
issued, other than to and in the name
of the registered owner.
----------------------------------------
Signature Guaranty
D-16
<PAGE>
Fill in for registration of shares of Common Stock and Security if to be
issued otherwise than to the registered holder.
- ----------------------------- Social Security or other (NAME)
Taxpayer Identification Number
------------
- -----------------------------
(ADDRESS)
- -----------------------------
PLEASE PRINT NAME AND
ADDRESS (INCLUDING ZIP
CODE NUMBER)
[The above Conversion Notice is to be modified, as appropriate, for conversion
into other Securities of the Company.]
D-17
<PAGE>
[Form of Face of Coupon]
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO
LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS
PROVIDED IN SECTION 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE OF 1954, AS
AMENDED.
--------------
INTERNATIONAL PAPER COMPANY
U.S.$ Due
-------------- -----------
Unless the Security to which this coupon appertains shall have been called
for previous redemption and payment thereof duly provided for on the date set
forth hereon, International Paper Company (herein called the "Company") will pay
to bearer, upon surrender hereof, the amount shown hereon (together with any
additional amounts in respect thereof which the Company may be required to pay
according to the terms of said Security and the Indenture referred to therein)
at the Paying Agents set out on the reverse hereof or at such other offices or
agencies (which, except as otherwise provided in the Security to which this
coupon appertains, shall be located outside the United States of America
(including the States and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction (the "United States"))
as the Company may designate from time to time, at the option of the Holder, by
United States dollar check drawn on a bank in The City of New York or by
transfer of United States dollars to an account maintained by the payee with a
bank located outside the United States, being [one year's] interest then payable
on said Security.
INTERNATIONAL PAPER COMPANY
By
-------------------------------
[Reverse of Coupon]*
---------------------------
---------------------------
---------------------------
---------------------------
---------------------------
- ----------
* Insert names and addresses of initial Paying Agents located outside the
United States.
D-18
<PAGE>
EXHIBIT E
[Forms of Certification]
EXHIBIT E.1
[Form of Certificate to Be Given By
Person Entitled to Receive Bearer Security]
CERTIFICATE
-----------------------------
[Insert title or sufficient description
of Securities to be delivered]
This is to certify that the above-captioned Securities are not being
acquired by or on behalf of a United States Person, or for offer to resell or
for resale directly or indirectly to a United States Person or any person inside
the United States, or, if a beneficial interest in the Securities is being
acquired by or on behalf of a United States Person, that such United States
Person is a financial institution within the meaning of Section 1.165-
12(c)(1)(v) of the United States Treasury Regulations or is acquiring through
such financial institution, and in either case the financial institution agrees
to comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the
Internal Revenue Code of 1986, as amended, and the regulations thereunder, and
is not purchasing for offer to resell or for resale inside the United States. If
the undersigned is a dealer, the undersigned agrees to obtain a similar
certificate from each person entitled to delivery of any of the above-captioned
Securities in bearer form purchased from it; PROVIDED, HOWEVER, that if the
undersigned has actual knowledge that the information contained in such a
certificate is false, (and, absent documentary evidence that the beneficial
owner of such Security is not a United States Person, it will be deemed to have
actual knowledge that such beneficial owner, other than a financial institution
described above, is a United States Person if it has a United States address for
such beneficial owner), the undersigned will not deliver a Security in temporary
or definitive bearer form to the person who signed such certificate
notwithstanding the delivery of such certificate to the undersigned.
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 and its possessions. We
undertake to advise you by telex if the above statement as to beneficial
ownership is not correct on the date of delivery of the above-captioned
Securities in bearer form as to all of such Securities.
E-1-1
<PAGE>
We undertake to advise you by telex if the above statement as to beneficial
ownership is not correct on the date of delivery of the above-captioned
Securities in bearer form as to all of such Securities.
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 to any interested party in such proceedings.
Dated:
---------------, -------
[To be dated on or after
____________, ____ (the date
determined as provided in
the Indenture)]
----------------------------
[Name of Person Entitled to
Receive Bearer Security]
----------------------------
(Authorized Signatory)
Name:
Title:
E-1-2
<PAGE>
EXHIBIT E.2
[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
statements 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: ,
[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
------------------------------
E-2-1
<PAGE>
EXHIBIT E.3
[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: ,
[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
------------------------------
E-3-1
<PAGE>
EXHIBIT E.4
[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.
E-4-1
<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: ,
[To be dated on or after the relevant
Interest Payment Date]
[Name of Person Entitled to
Receive Interest]
---------------------------
(Authorized Signatory)
Name:
Title:
E-4-2
<PAGE>
Exhibit 4.11
-----------------------------------------
-----------------------------------------
AMENDED AND RESTATED DECLARATION
OF TRUST
INTERNATIONAL PAPER CAPITAL TRUST III
Dated as of September 24, 1998
-----------------------------------------
-----------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I
INTERPRETATION AND DEFINITIONS..................................................................2
SECTION 1.1 Definitions...................................................................2
ARTICLE II
TRUST INDENTURE ACT............................................................................10
SECTION 2.1 Trust Indenture Act; Application..................................................10
SECTION 2.2 Lists of Holders of Securities....................................................10
SECTION 2.3 Reports by the Property Trustee...................................................11
SECTION 2.4 Periodic Reports to Property Trustee..............................................11
SECTION 2.5 Evidence of Compliance with Conditions
Precedent........................................................................11
SECTION 2.6 Events of Default; Waiver.........................................................11
SECTION 2.7 Event of Default; Notice..........................................................13
ARTICLE III
ORGANIZATION...................................................................................14
SECTION 3.1 Name..............................................................................14
SECTION 3.2 Office............................................................................14
SECTION 3.3 Purpose...........................................................................14
SECTION 3.4 Authority.........................................................................15
SECTION 3.5 Title to Property of the Trust....................................................15
SECTION 3.6 Powers and Duties of the Regular Trustees
.....................................................................................15
SECTION 3.7 Prohibition of Actions by the Trust and
the Trustees..................................................................19
SECTION 3.8 Powers and Duties of the Property
Trustee...................................................................20
SECTION 3.9 Certain Duties and Responsibilities of
the Property Trustee..........................................................22
SECTION 3.10 Certain Rights of Property Trustee................................................24
SECTION 3.11 Delaware Trustee..................................................................27
SECTION 3.12 Execution of Documents............................................................27
SECTION 3.13 Not Responsible for Recitals or Issuance
of Securities.................................................................28
SECTION 3.14 Duration of Trust.................................................................28
SECTION 3.15 Mergers...........................................................................28
ARTICLE IV
SPONSOR........................................................................................30
SECTION 4.1 Sponsor's Purchase of Common Securities
.....................................................................................30
SECTION 4.2 Responsibilities of the Sponsor...................................................31
ARTICLE V
TRUSTEES.......................................................................................31
SECTION 5.1 Number of Trustees................................................................31
SECTION 5.2 Delaware Trustee..................................................................32
SECTION 5.3 Property Trustee; Eligibility.....................................................32
</TABLE>
<PAGE>
<TABLE>
<S> <C>
SECTION 5.4 Qualifications of Regular Trustees and
Delaware Trustee Generally........................................................33
SECTION 5.5 Initial Trustees..................................................................33
SECTION 5.6 Appointment, Removal and Resignation of
Trustees......................................................................34
SECTION 5.7 Vacancies among Trustees..........................................................36
SECTION 5.8 Effect of Vacancies...............................................................36
SECTION 5.9 Meetings..........................................................................36
SECTION 5.10 Delegation of Power...............................................................37
ARTICLE VI
DISTRIBUTIONS..................................................................................37
SECTION 6.1 Distributions.....................................................................37
ARTICLE VII
ISSUANCE OF SECURITIES.........................................................................38
SECTION 7.1 General Provisions Regarding Securities
.....................................................................................38
SECTION 7.2 Execution and Authentication......................................................39
SECTION 7.3 [RESERVED]........................................................................39
SECTION 7.4 Registrar, Paying Agent and Conversion
Agent.................................................................................40
SECTION 7.5 Paying Agent to Hold Money in Trust...............................................40
SECTION 7.6 [RESERVED]........................................................................41
SECTION 7.7 [RESERVED]........................................................................41
SECTION 7.8 Outstanding Capital Securities....................................................41
SECTION 7.9 Capital Securities in Treasury....................................................41
SECTION 7.10 [RESERVED]........................................................................41
SECTION 7.11 Cancellation......................................................................42
ARTICLE VIII
TERMINATION OF TRUST...........................................................................42
SECTION 8.1 Termination of Trust..............................................................42
ARTICLE IX
TRANSFER ......................................................................................43
SECTION 9.1 General...........................................................................43
SECTION 9.2 Transfer of Certificates..........................................................44
SECTION 9.3 Deemed Security Holders...........................................................45
SECTION 9.4 Book Entry Interests..............................................................45
SECTION 9.5 Notices to Clearing Agency........................................................46
SECTION 9.6 Appointment of Successor Clearing Agency
.....................................................................................46
SECTION 9.7 Definitive Capital Security Certificates
.....................................................................................47
SECTION 9.8 Mutilated, Destroyed, Lost or Stolen
Certificates.................................................................48
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS......................................................48
SECTION 10.1 Liability........................................................................48
SECTION 10.2 Exculpation......................................................................49
</TABLE>
<PAGE>
<TABLE>
<S> <C>
SECTION 10.3 Fiduciary Duty...................................................................50
SECTION 10.4 Indemnification..................................................................51
SECTION 10.5 Outside Businesses...............................................................52
ARTICLE XI
ACCOUNTING.....................................................................................52
SECTION 11.1 Fiscal Year......................................................................52
SECTION 11.2 Certain Accounting Matters.......................................................52
SECTION 11.3 Banking..........................................................................53
SECTION 11.4 Withholding......................................................................54
ARTICLE XII
AMENDMENTS AND MEETINGS........................................................................54
SECTION 12.1 Amendments.......................................................................54
SECTION 12.2 Meetings of the Holders of Securities;
Action by Written Consent.......................................................56
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE
TRUSTEE........................................................................................59
SECTION 13.1 Representations and Warranties of
Property Trustee....................................................................59
SECTION 13.2 Representations and Warranties of
Delaware Trustee.............................................................60
ARTICLE XIV
[RESERVED]
..............................................................................................61
ARTICLE XV
MISCELLANEOUS..................................................................................61
SECTION 15.1 Notices..........................................................................61
SECTION 15.2 Governing Law....................................................................62
SECTION 15.3 Intention of the Parties.........................................................62
SECTION 15.4 Headings........................................................................63
SECTION 15.5 Successors and Assigns...........................................................63
SECTION 15.6 Partial Enforceability...........................................................63
SECTION 15.7 Counterparts.....................................................................63
ANNEX
ANNEX I - Terms of Securities............................................................................I
</TABLE>
<PAGE>
EXHIBITS
<TABLE>
<S> <C>
FORM OF CAPITAL SECURITY..........................................................................A-1
FORM OF COMMON SECURITIES..........................................................................A-2
SPECIMEN OF DEBENTURE...............................................................................B
UNDERWRITING AGREEMENT..............................................................................C
</TABLE>
<PAGE>
CROSS-REFERENCE TABLE*
<TABLE>
<CAPTION>
Section of
Trust Indenture Act Section of
of 1939, as amended Declaration
- ------------------- -----------
<C> <C>
310........................................................................ 2.1(c)
310(a)..................................................................... Inapplicable
310(b)..................................................................... 5.3(c),(d)
311(a)..................................................................... 2.2(b)
311(b)..................................................................... 2.2(b)
311(c)..................................................................... Inapplicable
312(a)..................................................................... Inapplicable
312(b)..................................................................... 2.2(b)
313........................................................................ 2.3
314........................................................................ 2.4
314(a)..................................................................... 3.6(j)
314(b)..................................................................... Inapplicable
314(c)..................................................................... 2.5
314(d)..................................................................... Inapplicable
314(f)..................................................................... Inapplicable
315(a)..................................................................... Inapplicable
315(c)..................................................................... Inapplicable
315(d)..................................................................... Inapplicable
316(a)..................................................................... Inapplicable
316(c)..................................................................... 3.6(e)
317........................................................................ 2.1(c)
317(b)..................................................................... 3.8(h)
</TABLE>
- ----------
* This Cross-Reference Table does not constitute part of the Declaration and
shall not affect the interpretation of any of its terms or provisions.
<PAGE>
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
INTERNATIONAL PAPER CAPITAL TRUST III
September 24, 1998
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated and effective as of September 24, 1998, by the undersigned trustees
(together with all other Persons from time to time duly appointed and serving as
trustees in accordance with the provisions of this Declaration, the "Trustees"),
International Paper Company, a New York corporation, as trust sponsor (the
"Sponsor"), and by the holders, from time to time, of undivided beneficial
interests in the Trust issued pursuant to this Declaration;
WHEREAS, the Trustees and the Sponsor established a trust (the
"Trust") under the Delaware Business Trust Act pursuant to a Declaration of
Trust dated as of August 28, 1998, (the "Original Declaration") and a
Certificate of Trust filed with the Secretary of State of Delaware on August 28,
1998, for the sole purpose of issuing and selling certain securities
representing undivided beneficial interests in the assets of the Trust and
investing the proceeds thereof in certain Debentures of the Debenture Issuer;
WHEREAS, as of the date hereof, no interests in
the Trust have been issued;
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the Original
Declaration; and
NOW, THEREFORE, it being the intention of the parties hereto
to continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
<PAGE>
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined
in the preamble above have the respective meanings assigned to them in this
Section 1.1;
(b) a term defined anywhere in this Declaration
has the same meaning throughout;
(c) all references to "the Declaration" or "this Declaration"
are to this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and
Sections and Exhibits are to Articles and Sections of and Exhibits to this
Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Declaration unless otherwise defined in this
Declaration or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice
versa.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act or any successor rule thereunder.
"Agent" means any Registrar, Paying Agent,
Conversion Agent or co-registrar.
"Authorized Officer" of a Person means any Person that is
authorized to bind such Person.
"Book Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Depositary as described in Section 9.4.
2
<PAGE>
"Business Day" means a day other than (a) a Saturday or
Sunday, or (b) a day on which banking institutions in The City of New York are
authorized or required by law or executive order to remain closed.
"Business Trust Act" means Chapter 38 of Title 12
of the Delaware Code, 12 Del. Code Section 3801 et seq., as it may
be amended from time to time.
"Capital Securities Guarantee" means the guarantee agreement
to be dated as of September 24, 1998, of the Sponsor in respect of the Capital
Securities.
"Capital Securities" has the meaning specified in
Section 7.1(a).
"Capital Security Beneficial Owner" means, with respect to a
Book Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Depositary, or on the books of a
Person maintaining an account with such Depositary (directly as a Participant or
as an indirect participant, in each case in accordance with the rules of such
Depositary).
"Certificate" means a certificate in global or definitive form
representing a Common Security or a Capital Security.
"Clearing Agency" means an organization registered
as a "clearing agency" pursuant to Section 17A of the
Exchange Act. The Depository Trust Company will be the
initial Clearing Agency.
"Closing Date" means September 24, 1998.
"Code" means the Internal Revenue Code of 1986 as
amended.
"Commission" means the Securities and Exchange
Commission.
"Common Securities" has the meaning set forth in
Section 7.1(a).
"Common Securities Guarantee" means the guarantee agreement to
be dated as of September 24, 1998, of the Sponsor in respect of the Common
Securities.
3
<PAGE>
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or
agent of (i) the Trust or (ii) the Trust's Affiliates; and
(b) any Holder of Securities.
"Debenture Issuer" means the Sponsor in its
capacity as issuer of the Debentures.
"Debentures" means the series of Debentures to be issued by
the Debenture Issuer under the Indenture to be held by the Property Trustee, a
specimen certificate for such series of Debentures being Exhibit B.
"Debenture Trustee" means The Bank of New York, a New York
banking corporation, as trustee under the Indenture until a successor is
appointed thereunder, and thereafter means such successor trustee.
"Definitive Capital Securities" means the Capital Securities
in definitive form issued by the Trust.
"Definitive Capital Security Certificate" has the
meaning set forth in Section 9.4.
"Delaware Trustee" has the meaning set forth in
Section 5.2.
"Distribution" means a distribution payable to Holders of
Securities in accordance with Section 6.1.
"Depositary" means The Depository Trust Company,
the initial Clearing Agency.
"Event of Default" in respect of the Securities means an Event
of Default (as defined in the Indenture) has occurred and is continuing in
respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor legislation.
"Global Certificate" has the meaning set forth in
Section 9.4.
"Holder" means a Person in whose name a
Certificate representing a Security is registered, such
4
<PAGE>
Person being a beneficial owner within the meaning of the Business Trust Act.
"Indemnified Person" means (a) any Trustee; (b) any Affiliate
of any Trustee; (c) any officers, directors, shareholders, members, partners,
employees, representatives or agents of any Trustee; or (d) any employee or
agent of the Trust or its Affiliates.
"Indenture" means the Subordinated Debt Indenture dated as of
September 15, 1998, as supplemented by the First Supplemental Indenture, dated
as of September 24, 1998, between the Debenture Issuer and The Bank of New York,
as trustee, and any indenture supplemental thereto pursuant to which the
Debentures are to be issued.
"Investment Company" means an investment company
as defined in the Investment Company Act.
"Investment Company Act" means the U.S. Investment Company Act
of 1940, as amended from time to time, or any successor legislation.
"Legal Action" has the meaning set forth in
Section 3.6(g).
"Liquidation Amount" means the stated amount of
$25 per Security.
"Majority in Liquidation Amount of the Securities" means,
except as provided in the terms of the Capital Securities and by the Trust
Indenture Act, Holder(s) of outstanding Securities voting together as a single
class or, as the context may require, Holders of outstanding Capital Securities
or Holders of outstanding Common Securities voting separately as a class, who
are the record owners of more than 50% of the aggregate Liquidation Amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all outstanding Securities of the relevant
class.
"Ministerial Action" has the meaning set forth in
the terms of the Securities as set forth in Annex I.
5
<PAGE>
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include:
(a) a statement that each officer signing the Certificate has
read the covenant or condition and the definition relating
thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in
rendering the Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's
opinion, is necessary to enable such officer to express an
informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied
with.
"Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges or securities deposited with the Clearing
Agency.
"Paying Agent" has the meaning specified in
Section 3.8(h).
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Property Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 5.3.
6
<PAGE>
"Property Trustee Account" has the meaning set
forth in Section 3.8(c).
"Prospectus Supplement", as used in Annex I hereto, means the
prospectus supplement, dated as of September 17, 1998, relating to the issuance
and sale by the Trust of Capital Securities.
"Quorum" means a majority of the Regular Trustees or, if there
are only two Regular Trustees, both of them.
"Register" has the meaning set forth in Section
7.4.
"Regular Trustee" means any Trustee other than the Property
Trustee and the Delaware Trustee.
"Related Party" means, with respect to the Sponsor, any direct
or indirect wholly owned subsidiary of the Sponsor or any other Person that
owns, directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"Responsible Officer" means, with respect to the Property
Trustee, any vice-president, any assistant vice-president, the treasurer, any
assistant treasurer, any trust officer or assistant trust officer or any other
officer in the Corporate Trust Department of the Property Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Securities" means the Common Securities and the
Capital Securities.
"Securities Act" means the Securities Act of 1933,
as amended.
"Securities Custodian" means the custodian with respect to the
Global Capital Security and any other Capital Security in global form.
"66-2/3% in Liquidation Amount of the Securities"
means, except as provided in the terms of the Capital
7
<PAGE>
Securities and by the Trust Indenture Act, Holders of outstanding Securities
voting together as a single class or, as the context may require, Holders of
Capital Securities or Holder(s) of outstanding Common Securities voting
separately as a class, representing at least 66-2/3% of the aggregate
Liquidation Amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions, to
the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Sponsor" means International Paper Company, a New York
corporation, or any successor entity in a merger, consolidation or amalgamation,
in its capacity as sponsor of the Trust.
"Successor Delaware Trustee" has the meaning set
forth in Section 5.6(c).
"Successor Property Trustee" has the meaning set
forth in Section 5.6(b).
"Super Majority" has the meaning set forth in
Section 2.6(a)(ii).
"Tax Event" means the receipt by the Trust of an Opinion of
Counsel experienced in such matters, who shall not be an officer or employee of
the Sponsor or any of its Affiliates, to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement, action or decision is announced on or after
the date of issuance of the Capital Securities, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days of the
delivery of such Opinion of Counsel, subject to United States Federal income tax
with respect to income received or accrued on the Debentures, (ii) interest
payable by the Sponsor on the Debentures is not, or within 90 days of the
delivery of such Opinion of Counsel will not be, deductible by the Sponsor, in
whole or in part, for United States Federal income tax purposes, or (iii) the
Trust is, or will be within 90 days of the delivery of such Opinion of
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Counsel, subject to more than a de minimis amount of other taxes, duties or
other governmental charges.
"10% in Liquidation Amount of the Securities" means, except as
provided in the terms of the Capital Securities or by the Trust Indenture Act,
Holders of outstanding Securities voting together as a single class or, as the
context may require, Holders of outstanding Capital Securities or Holders of
outstanding Common Securities, voting separately as a class, representing 10% of
the aggregate Liquidation Amount (including the stated amount that would be paid
on redemption, liquidation or otherwise, plus accrued and unpaid Distributions
to the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Treasury Regulations" means the income tax regulations,
including temporary and proposed regulations, promulgated under the Code by the
United States Treasury, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
"Trust Indenture Act" means the U.S. Trust
Indenture Act of 1939, as amended.
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Underwriters" has the meaning specified in the
Underwriting Agreement.;
"Underwriting Agreement" means the Underwriting Agreement,
dated as of September 17, 1998, among the Trust, the Sponsor and the
Underwriters, as the same may be amended from time to time.
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ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration, which are
incorporated by reference in and made part of this Indenture and shall, to the
extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
Trustee for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this
Declaration limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed
duties shall control.
(d) The application of the Trust Indenture Act to this
Declaration shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of
the Trust shall provide the Property Trustee (i) within 14 days after each
record date for payment of Distributions, a list, in such form as the Property
Trustee may reasonably require, of the names and addresses of the Holders of the
Securities ("List of Holders") as of such record date, provided that neither the
Sponsor nor the Regular Trustees on behalf of the Trust shall be obligated to
provide such List of Holders at any time the List of Holders does not differ
from the most recent List of Holders given to the Property Trustee by the
Sponsor and the Regular Trustees on behalf of the Trust, and (ii) at any other
time, within 30 days of receipt by the Trust of a written request for a List of
Holders as of a date no more than 14 days before such List of Holders is given
to the Property Trustee. The Property Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in Lists of Holders
given to it or which it receives in the capacity as Paying Agent (if acting in
such capacity) provided that the Property Trustee may destroy any
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List of Holders previously given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations
under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after May 15 of each year, the Property
Trustee shall provide to the Holders of the Capital Securities such reports,
if any, as are required by Section 313 of the Trust Indenture Act in the form
and in the manner provided by Section 313 of the Trust Indenture Act. The
Property Trustee shall also comply with the requirements of Section 313(d) of
the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Property Trustee.
Each of the Sponsor and the Regular Trustees on behalf of
the Trust shall provide to the Property Trustee such documents, reports and
information (if any) as required by Section 314 of the Trust Indenture Act
and the compliance certificate required by Section 314 of the Trust Indenture
Act in the form, in the manner and at the times required by Section 314 of
the Trust Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees on behalf of
the Trust shall provide to the Property Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this Declaration that
relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act. Any certificate or opinion required to be given by an officer
pursuant to Section 314(c)(1) of the Trust Indenture Act may be given in the
form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in Liquidation Amount of Capital
Securities may, by vote, on behalf of the Holders of all of the Capital
Securities, waive any past Event of Default in respect of the Capital Securities
and its consequences, provided that, if the underlying Event of Default under
the Indenture:
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(i) is not waivable under the Indenture, the Event of
Default under the Declaration shall also not be waivable; or
(ii) requires the consent or vote of greater than a
majority in principal amount the holders of the Debentures (a
"Super Majority") to be waived under the Indenture, the Event of
Default under the Declaration may only be waived by the vote of
the Holders of at least the proportion in Liquidation Amount of
the Capital Securities that the relevant Super Majority represents
of the aggregate principal amount of the Debentures outstanding.
Upon such waiver, any such default shall cease to exist, and
any Event of Default with respect to the Capital Securities arising therefrom
shall be deemed to have been cured, for every purpose of this Declaration, but
no such waiver shall extend to any subsequent or other default or an Event of
Default with respect to the Capital Securities or impair any right consequent
thereon. Any waiver by the Holders of the Capital Securities of an Event of
Default with respect to the Capital Securities shall also be deemed to
constitute a waiver by the Holders of the Common Securities of any such Event of
Default with respect to the Common Securities for all purposes of this
Declaration without any further act, vote, or consent of the Holders of the
Common Securities.
(b) The Holders of a Majority in Liquidation Amount of the
Common Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, except where
the Holders of the Common Securities are deemed to have waived
such Event of Default under the Declaration as provided below in
this Section 2.6(b), the Event of Default under the Declaration
shall also not be waivable; or
(ii) requires the consent or vote of a Super Majority to
be waived, except where the Holders of the Common Securities are
deemed to have waived such Event of Default under the Declaration
as provided below in
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this Section 2.6(b), the Event of Default under the Declaration may
only be waived by the vote of the Holders of at least the proportion in
Liquidation Amount of the Capital Securities that the relevant Super
Majority represents of the aggregate principal amount of the Debentures
outstanding;
provided further, each Holder of Common Securities will be deemed to have waived
any such Event of Default and all Events of Default with respect to the Common
Securities and its consequences until all Events of Default with respect to the
Capital Securities have been cured, waived or otherwise eliminated, and until
such Events of Default have been so cured, waived or otherwise eliminated, the
Property Trustee will be deemed to be acting solely on behalf of the Holders of
the Capital Securities and only the Holders of the Capital Securities will have
the right to direct the Property Trustee in accordance with the terms of the
Securities. Subject to the foregoing provisions of this Section 2.6(b), upon
such waiver, any such default shall cease to exist and any Event of Default with
respect to the Common Securities arising therefrom shall be deemed to have been
cured for every purpose of this Declaration, but no such waiver shall extend to
any subsequent or other default or Event of Default with respect to the Common
Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the
Property Trustee at the direction of the Holders of the Capital Securities,
constitutes a waiver of the corresponding Event of Default under this
Declaration.
SECTION 2.7 Event of Default; Notice.
(a) The Property Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders of the Securities, notices of all defaults with respect
to the Securities known to the Property Trustee, unless such defaults have been
cured before the giving of such notice (the term "defaults" for the purposes of
this Section 2.7(a) being hereby defined to be an Event of Default as defined in
the Indenture, not including any periods of grace provided for therein and
irrespective of the giving of any notice provided therein); provided that,
except for a default in the payment of principal of (or premium, if any) or
interest on any of the Debentures or in the payment of any sinking
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fund installment established for the Debentures, the Property Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee, or a trust committee of directors and/or Responsible
Officers of the Property Trustee in good faith determines that the withholding
of such notice is in the interests of the Holders of the Securities.
(b) The Property Trustee shall not be deemed to have knowledge
of any default except:
(i) a default under Sections 5.1(1) and 5.1(2) of the
Indenture; or
(ii) any default as to which the Property Trustee shall
have received written notice.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "International Paper Capital Trust III," as
such name may be modified from time to time by the Regular Trustees following
written notice to the Holders of Securities. The Trust's activities may be
conducted under the name of the Trust or any other name deemed advisable by the
Regular Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o
International Paper Company, Two Manhattanville Road, Purchase, New York 10577,
Attention: James W. Guedry. On ten Business Days written notice to the Holders
of Securities, the Regular Trustees may designate another principal office.
SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to
issue and sell Securities and use the proceeds from such sale to acquire the
Debentures, and (b) except as otherwise limited herein, to engage in only those
other activities necessary, or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds
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derived from investments, pledge any of its assets, or otherwise undertake (or
permit to be undertaken) any activity that would cause the Trust not to be
classified for United States Federal income tax purposes as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration and to
the specific duties of the Property Trustee, the Regular Trustees shall have
exclusive and complete authority to carry out the purposes of the Trust. An
action taken by the Regular Trustees in accordance with their powers shall
constitute the act of and serve to bind the Trust and an action taken by the
Property Trustee in accordance with its powers shall constitute the act of and
serve to bind the Trust. In dealing with the Trustees acting on behalf of the
Trust, no person shall be required to inquire into the authority of the Trustees
to bind the Trust. Persons dealing with the Trust are entitled to rely
conclusively on the power and authority of the Trustees as set forth in this
Declaration.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the
Debentures and the Property Trustee Account or as otherwise provided in this
Declaration, legal title to all assets of the Trust shall be vested in the
Trust. The Holders shall not have legal title to any part of the assets of the
Trust, but shall have an undivided beneficial interest in the assets of the
Trust.
SECTION 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:
(a) to issue and sell the Capital Securities and the Common
Securities in accordance with this Declaration; provided, however, that the
Trust may issue no more than one series of Capital Securities and no more than
one series of Common Securities, and, provided further, that there shall be no
interests in the Trust other than the Securities, and the issuance of Securities
shall be limited to a one-time,
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simultaneous issuance of both Capital Securities and Common
Securities on the Closing Date;
(b) in connection with the issue and sale of the Capital
Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission, at such time
as determined by the Sponsor, a registration statement filed on
Form S-3 prepared by the Sponsor, including any amendments thereto
in relation to the Capital Securities;
(ii) execute and file any documents prepared by the
Sponsor, or take any acts as determined by the Sponsor to be
necessary in order to qualify or register all or part of the
Capital Securities in any State or foreign jurisdiction in which
the Sponsor has determined to qualify or register such Capital
Securities for sale;
(iii) execute and file an application, prepared by or on
behalf of the Sponsor, at such time as determined by the Sponsor,
to the New York Stock Exchange or any other national stock
exchange or the Nasdaq National Market for listing or quotation of
the Capital Securities;
(iv) to execute and deliver letters, documents, or
instruments with The Depository Trust Company relating the Capital
Securities;
(v) execute and file with the Commission, at such time
as determined by the Sponsor, a registration statement on Form
8-A, including any amendments thereto, prepared by the Sponsor
relating to the registration of the Capital Securities under
Section 12(b) of the Exchange Act; and
(vi) execute and enter into the Underwriting Agreement
and other related agreements providing for the sale of the Capital
Securities;
(c) to acquire the Debentures with the proceeds of the sale of
the Capital Securities and the Common Securities; provided, however, that the
Regular Trustees shall cause legal title to the Debentures to be held of record
in the name of the Property Trustee for the benefit
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of the Holders of the Capital Securities and the Holders or Common Securities;
(d) to give the Sponsor and the Property Trustee prompt
written notice of the occurrence of a Tax Event; provided that the Regular
Trustees shall consult with the Sponsor and the Property Trustee before taking
or refraining from taking any Ministerial Action in relation to a Tax Event;
(e) to establish a record date with respect to all actions
to be taken hereunder that require a record date be established, including
and with respect to, for the purposes of Section 316(c) of the Trust
Indenture Act, Distributions, voting rights, redemptions and exchanges, and
to issue relevant notices to the Holders of Capital Securities and Holders of
Common Securities as to such actions and applicable record dates;
(f) to take all actions and perform such duties as may be
required of the Regular Trustees pursuant to the terms of the Securities;
(g) to bring or defend, pay, collect, compromise, arbitrate,
resort to legal action, or otherwise adjust claims or demands of or against the
Trust ("Legal Action"), unless pursuant to Section 3.8(e), the Property Trustee
has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who
may be designated as officers with titles) and managers, contractors, advisors,
and consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's obligations
under the Trust Indenture Act;
(j) to give the certificate required by Section 314(a)(4)
of the Trust Indenture Act to the Property Trustee, which certificate may be
executed by any Regular Trustee;
(k) to incur expenses that are necessary or
incidental to carry out any of the purposes of the Trust;
(l) to act as, or appoint another Person to act
as, registrar and transfer agent for the Securities;
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(m) to give prompt written notice to the Holders of the
Securities of any notice received from the Debenture Issuer of its election (i)
to defer payments of interest on the Debentures by extending the interest
payment period under the Indenture or (ii) to extend or advance the scheduled
maturity date on the Debentures;
(n) to execute all documents or instruments, perform all
duties and powers, and do all things for and on behalf of the Trust in all
matters necessary or incidental to the foregoing;
(o) to take all action that may be necessary or appropriate
for the preservation and the continuation of the Trust's valid existence,
rights, franchises and privileges as a statutory business trust under the laws
of the State of Delaware and of each other jurisdiction in which such existence
is necessary to protect the limited liability of the Holders of the Capital
Securities or to enable the Trust to effect the purposes for which the Trust was
created;
(p) to take any action, not inconsistent with this Declaration
or with applicable law, that the Regular Trustees determine in their discretion
to be necessary or desirable in carrying out the activities of the Trust as set
out in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered under the Investment
Company Act;
(ii) causing the Trust to be classified for United
States Federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure
that the Debentures will be treated as indebtedness of the
Debenture Issuer for United States Federal income tax purposes,
provided that such action does not adversely affect the interests of Holders;
and
(q) to take all action necessary to cause all applicable tax
returns and tax information reports that are required to be filed with respect
to the Trust to be duly
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prepared and filed by the Regular Trustees, on behalf of the Trust.
The Regular Trustees must exercise the powers set forth in
this Section 3.6 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 3.3, and the Regular Trustees shall not take any
action that is inconsistent with the purposes and functions of the Trust set
forth in Section 3.3.
Subject to this Section 3.6, the Regular Trustees shall have
none of the powers or the authority of the Property Trustee set forth in Section
3.8.
SECTION 3.7 Prohibition of Actions by the Trust and the
Trustees.
(a) The Trust shall not, and the Trustees (including the
Property Trustee) shall not, engage in any activity other than as required or
authorized by this Declaration. In particular, the Trust shall not and the
Trustees (including the Property Trustee) shall cause the Trust not to:
(i) invest any proceeds received by the Trust from
holding the Debentures, but shall distribute all such proceeds to
Holders of Securities pursuant to the terms of this Declaration
and of the Securities;
(ii) acquire any assets other than as expressly provided
herein;
(iii) possess Trust property for other than a Trust
purpose;
(iv) make any loans or incur any indebtedness other than
loans represented by the Debentures;
(v) possess any power or otherwise act in such a way as
to vary the Trust assets or the terms of the Securities in any way
whatsoever;
(vi) issue any securities or other evidences of
beneficial ownership of, or beneficial interest in, the Trust
other than the Securities; or
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(vii) (A) direct the time, method and place of
exercising any trust or power conferred upon the Debenture Trustee
with respect to the Debentures, (B) waive any past default that is
waivable under Section 5.13 of the Indenture, (C) exercise any
right to rescind or annul any declaration that the principal of
all the Debentures shall be due and payable, or (D) consent to any
amendment, modification or termination of the Indenture or the
Debentures where such consent shall be required unless the Trust
shall have received an opinion of counsel to the effect that such
modification will not cause more than an insubstantial risk that
for United States Federal income tax purposes the Trust will not
be classified as a grantor trust or partnership.
SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned by and
held of record in the name of the Property Trustee in trust for the benefit of
the Holders of the Securities. The right, title and interest of the Property
Trustee to the Debentures shall vest automatically in each Person who may
hereafter be appointed as Property Trustee in accordance with Section 5.6. Such
vesting and cessation of title shall be effective whether or not conveyancing
documents with regard to the Debentures have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title
and interest in the Debentures to the Regular Trustees or to the Delaware
Trustee (if the Property Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest
bearing trust account (the "Property Trustee Account") in the name
of and under the exclusive control of the Property Trustee on
behalf of the Holders of the Securities and, upon the receipt of
payments of funds made in respect of the Debentures held by the
Property Trustee, deposit such funds into the Property Trustee
Account and make payments to the Holders of the Capital Securities
and Holders of the Common Securities from the Property Trustee
Account in accordance with Section 6.1. Funds in the Property
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Trustee Account shall be held uninvested until disbursed in
accordance with this Declaration;
(ii) engage in such ministerial activities as so
directed and as shall be necessary or appropriate to effect the
redemption of the Capital Securities and the Common Securities to
the extent the Debentures are redeemed or mature; and
(iii) upon notice of distribution issued by the Regular
Trustees in accordance with the terms of the Securities, engage in
such ministerial activities as so directed as shall be necessary
or appropriate to effect the distribution of the Debentures to
Holders of Securities upon the occurrence of certain special
events (as may be defined in the terms of the Securities) arising
from a change in law or a change in legal interpretation or other
specified circumstances pursuant to the terms of the Securities.
(d) The Property Trustee shall take all actions and perform
such duties as may be specifically required of the Property Trustee pursuant to
the terms of the Securities.
(e) The Property Trustee shall take any Legal Action which
arises out of or in connection with an Event of Default or the Property
Trustee's duties and obligations under this Declaration or the Trust Indenture
Act.
(f) The Property Trustee shall not resign as a Trustee unless
either:
(i) the Trust has been completely liquidated and the
proceeds of the liquidation distributed to the Holders of
Securities pursuant to the terms of the Securities; or
(ii) a Successor Property Trustee has been appointed and
has accepted that appointment in accordance with Section 5.6.
(g) The Property Trustee shall have the legal power to
exercise all of the rights, powers and privileges of a holder of Debentures
under the Indenture and, if an Event of Default occurs and is continuing, the
Property Trustee shall, for the benefit of Holders of the Securities,
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enforce its rights as holder of the Debentures subject to the rights of the
Holders pursuant to the terms of such Securities.
(h) The Property Trustee will act as Paying Agent and
Registrar in New York (the "Paying Agent") to pay Distributions, redemption
payments or liquidation payments on behalf of the Trust with respect to all
securities and any such Paying Agent shall comply with Section 317(b) of the
Trust Indenture Act. Any Paying Agent may be removed by the Property Trustee
at any time and a successor Paying Agent or additional Paying Agents may be
appointed at any time by the Property Trustee.
(i) Subject to this Section 3.8, the Property Trustee shall
have none of the duties, liabilities, powers or the authority of the Regular
Trustees set forth in Section 3.6.
The Property Trustee must exercise the powers set forth in
this Section 3.8 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 3.3, and the Property Trustee shall not take any
action that is inconsistent with the purposes and functions of the Trust set out
in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the Property
Trustee.
(a) The Property Trustee, before the occurrence of any Event
of Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Declaration and no implied covenants shall be read into this Declaration
against the Property Trustee. In case an Event of Default has occurred (that has
not been cured or waived pursuant to Section 2.6), the Property Trustee shall
exercise such of the rights and powers vested in it by this Declaration, and use
the same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) No provision of this Declaration shall be construed to
relieve the Property Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:
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(i) prior to the occurrence of an Event of Default and
after the curing or waiving of all such Events of Default that may
have occurred:
(A) the duties and obligations of the Property
Trustee shall be determined solely by the express provisions
of this Declaration and the Property Trustee shall not be
liable except for the performance of such duties and
obligations as are specifically set forth in this
Declaration, and no implied covenants or obligations shall be
read into this Declaration against the Property Trustee; and
(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively rely,
as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Property Trustee and conforming to the
requirements of this Declaration; but in the case of any such
certificates or opinions that by any provision hereof are
specifically required to be furnished to the Property
Trustee, the Property Trustee shall be under a duty to
examine the same to determine whether or not they conform to
the requirements of this Declaration;
(ii) the Property Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer of
the Property Trustee, unless it shall be proved that the Property
Trustee was negligent in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders of not less
than a Majority in Liquidation Amount of the Securities relating
to the time, method and place of conducting any proceeding for any
remedy available to the Property Trustee, or exercising any trust
or power conferred upon the Property Trustee under this
Declaration;
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(iv) no provision of this Declaration shall require the
Property Trustee to expend or risk its own funds or otherwise
incur personal financial liability in the performance of any of
its duties or in the exercise of any of its rights or powers, if
it shall have reasonable grounds for believing that the repayment
of such funds or liability is not reasonably assured to it under
the terms of this Declaration or adequate indemnity against such
risk or liability is not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Debentures
and the Property Trustee Account shall be to deal with such
property in a similar manner as the Property Trustee deals with
similar property for its own account, subject to the protections
and limitations on liability afforded to the Property Trustee
under this Declaration and the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or
liability for or with respect to the value, genuineness, existence
or sufficiency of the Debentures or the payment of any taxes or
assessments levied thereon or in connection therewith;
(vii) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise
agree with the Sponsor. Money held by the Property Trustee need
not be segregated from other funds held by it except in relation
to the Property Trustee Account maintained by the Property Trustee
pursuant to Section 3.8(c)(i) and except to the extent otherwise
required by law; and
(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Regular Trustees or the Sponsor
with their respective duties under this Declaration, nor shall the
Property Trustee be liable for the default or misconduct of the
Regular Trustees or the Sponsor.
SECTION 3.10 Certain Rights of Property Trustee.
(a) Subject to the provisions of Section 3.9:
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(i) the Property Trustee may rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed, sent or presented by the
proper party or parties;
(ii) any direction or act of the Sponsor or the Regular
Trustees contemplated by this Declaration shall be sufficiently
evidenced by an Officers' Certificate;
(iii) whenever in the administration of this
Declaration, the Property Trustee shall deem it desirable that a
matter be proved or established before taking, suffering or
omitting any action hereunder, the Property Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officers'
Certificate which, upon receipt of such request, shall be promptly
delivered by the Sponsor or the Regular Trustees;
(iv) the Property Trustee shall have no duty to see to
any recording, filing or registration of any instrument (including
any financing or continuation statement or any filing under tax or
securities laws) or any rerecording, refiling or registration
thereof;
(v) the Property Trustee may consult with counsel or
other experts and the advice or opinion of such counsel and
experts with respect to legal matters or advice within the scope
of such experts' area of expertise 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
accordance with such advice or opinion, such counsel may be
counsel to the Sponsor or any of its Affiliates, and may include
any of its employees. The Property Trustee shall have the right at
any time to seek instructions concerning the administration of
this Declaration from any court of competent jurisdiction;
(vi) the Property Trustee shall be under no obligation
to exercise any of the rights or powers
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vested in it by this Declaration at the request or direction of
any Holder, unless such Holder shall have provided to the Property
Trustee adequate security and indemnity, which would satisfy a
reasonable person in the position of the Property Trustee, against
the costs, expenses (including attorneys' fees and expenses) and
liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may be
requested by the Property Trustee provided, that, nothing
contained in this Section 3.10(a)(vi) shall be taken to relieve
the Property Trustee, upon the occurrence of an Event of Default,
of its obligation to exercise the rights and powers vested in it
by this Declaration;
(vii) the Property 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, security, bond,
debenture, note, other evidence of indebtedness or other paper or
document, but the Property Trustee, in its discretion, may make
such further inquiry or investigation into such facts or matters
as it may see fit;
(viii) the Property 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 Property
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;
(ix) any action taken by the Property Trustee or its
agents hereunder shall bind the Trust and the Holders of the
Securities, and the signature of the Property Trustee or its
agents alone shall be sufficient and effective to perform any such
action and no third party shall be required to inquire as to the
authority of the Property Trustee to so act or as to its
compliance with any of the terms and provisions of this
Declaration, both of which shall be conclusively evidenced by the
Property Trustee's or its agent's taking such action;
(x) whenever in the administration of this Declaration
the Property Trustee shall deem it
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desirable to receive instructions with respect to enforcing any
remedy or right or taking any other action hereunder the Property
Trustee (i) may request instructions from the Holders of the
Securities which instructions may only be given by the Holders of
the same proportion in Liquidation Amount of the Securities as
would be entitled to direct the Property Trustee under the terms
of the Securities in respect of such remedy, right or action, (ii)
may refrain from enforcing such remedy or right or taking such
other action until such instructions are received, and (iii) shall
be protected in acting in accordance with such instructions; and
(xi) except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be under any
obligation to take any action that is discretionary under the
provisions of this Declaration.
(b) No provision of this Declaration shall be deemed to impose
any duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
SECTION 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other
than Section 5.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Regular Trustees or the Property Trustee described in
this Declaration. Except as set forth in Section 5.2, the Delaware Trustee shall
be a Trustee for the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Business Trust Act.
SECTION 3.12 Execution of Documents.
Unless otherwise determined by the Regular Trustees, and
except as otherwise required by the Business
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Trust Act, any Regular Trustee is authorized to execute on behalf of the Trust
any documents that the Regular Trustees have the power and authority to execute
pursuant to Section 3.6; provided that, the registration statement referred to
in Section 3.6(b)(i), including any amendments thereto, shall be signed by all
of the Regular Trustees.
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities
shall be taken as the statements of the Sponsor, and the Trustees do not assume
any responsibility for their correctness. The Trustees make no representations
as to the value or condition of the property of the Trust or any part thereof.
The Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.
SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of
Article VIII hereof, shall exist until August 28, 2047.
SECTION 3.15 Mergers.
(a) The Trust may not consolidate, amalgamate, merge with or
into, or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other entity or person,
except as described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of a majority of the
Regular Trustees and without the consent of the Holders of the Securities, the
Delaware Trustee or the Property Trustee, consolidate, amalgamate, merge with or
into, or be replaced by a trust organized as such under the laws of any State or
the District of Columbia; provided that:
(i) if the Trust is not the surviving entity, the
successor entity (the "Successor Entity") either:
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(A) expressly assumes all of the obligations of the
Trust under the Securities; or
(B) substitutes for the Securities other securities
having substantially the same terms as the Capital Securities
(the "Successor Securities") as long as the Successor
Securities rank, with respect to participation in the profits
and distributions or in the assets of the Successor Entity at
least as high as the Capital Securities rank with respect to
participation in the profits and dividends or in the assets
of the Trust;
(ii) the Debenture Issuer expressly acknowledges such
Successor Entity as the Holder of the Debentures;
(iii) the Capital Securities or any Successor Securities
are listed, or any Successor Securities will be listed upon
notification of issuance, on any national securities exchange or
with any other organization on which the Capital Securities are
then listed or quoted;
(iv) such merger, consolidation, amalgamation or
replacement does not cause the Capital Securities (including any
Successor Securities) to be downgraded by any nationally
recognized statistical rating organization;
(v) such merger, consolidation, amalgamation or
replacement does not adversely affect the powers, preferences and
other special rights of the Holders of the Capital Securities
(including any Successor Securities) in any material respect;
(vi) such Successor Entity has a purpose substantially
identical to that of the Trust;
(vii) prior to such merger, consolidation, amalgamation
or replacement, the Sponsor has received an opinion of a
nationally recognized independent counsel (reasonably acceptable
to the Property Trustee)
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to the Trust experienced in such matters to the effect
that:
(A) the Successor Entity will be treated as a
grantor trust for United States Federal income tax purposes;
(B) following such merger, consolidation,
amalgamation or replacement, neither the Sponsor nor the
Successor Entity will be required to register as an
Investment Company; and
(C) such merger, consolidation, amalgamation or
replacement will not adversely affect the limited liability
of the Holders of the Securities (including any Successor
Securities); and
(viii) the Sponsor provides a guarantee to the Holders
of the Successor Securities with respect to the Successor Entity
having substantially the same terms as the Capital Securities
Guarantee.
(c) Notwithstanding Section 3.15(b), the Trust shall not,
except with the consent of Holders of 100% in Liquidation Amount of the Common
Securities, consolidate, amalgamate, merge with or into, or be replaced by any
other entity or permit any other entity to consolidate, amalgamate, merge with
or into, or replace it if such consolidation, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as other
than a grantor trust for United States Federal income tax purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
On the Closing Date the Sponsor will purchase all the Common
Securities issued by the Trust, in an aggregate Liquidation Amount equal to 3%
of the total capital of the Trust, at the same time as the Capital Securities
are sold.
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SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Capital
Securities, the Sponsor shall have the exclusive right and responsibility to
engage in the following activities:
(a) to prepare for filing by the Trust with the Commission the
registration statement on Form S-3, including any amendments thereto;
(b) to determine the States and foreign jurisdictions in which
to take appropriate action to qualify or register for sale all or part of the
Capital Securities and to do any and all such acts, other than actions which
must be taken by the Trust, and advise the Trust of actions it must take, and
prepare for execution and filing any documents to be executed and filed by the
Trust, as the Sponsor deems necessary or advisable in order to comply with the
applicable laws of any such States and foreign jurisdictions;
(c) to prepare for filing by the Trust an application to the
New York Stock Exchange or any other national stock exchange or the Nasdaq
National Market for listing or quotation of the Capital Securities;
(d) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A relating to the registration of the Capital
Securities under Section 12(b) of the Exchange Act, including any amendments
thereto; and
(e) to negotiate the terms of the Underwriting Agreement and
other related agreements providing for the sale of the Capital Securities.
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees.
The number of Trustees shall initially be five (5), and:
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(a) at any time before the issuance of any Securities, the
Sponsor may, by written instrument, increase or decrease the number of Trustees;
and
(b) after the issuance of any Securities the number of
Trustees may be increased or decreased by vote of the Holders of a Majority in
Liquidation Amount of the Common Securities voting as a class at a meeting of
the Holders of the Common Securities; provided that, if the Property Trustee
does not also act as Delaware Trustee, the number of Trustees shall be at least
five (5).
SECTION 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the
"Delaware Trustee") shall be an entity which has its principal place of business
in the State of Delaware, and otherwise meets the requirements of applicable
law; provided that, if the Property Trustee has its principal place of business
in the State of Delaware and otherwise meets the requirements of applicable law,
then the Property Trustee shall also be the Delaware Trustee and Section 3.11
shall have no application.
SECTION 5.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee which shall act as
Property Trustee which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business under
the laws of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or Person
permitted by the Commission to act as an institutional trustee
under the Trust Indenture Act, authorized under such laws to
exercise corporate trust powers, having a combined capital and
surplus of at least 50 million U.S. dollars ($50,000,000), and
subject to supervision or examination by Federal, State,
Territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law
or to the requirements of the supervising or examining authority
referred to above, then for the purposes of this Section
5.3(a)(ii), the combined capital and surplus of such corporation
shall be deemed to be its
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combined capital and surplus as set forth in its most recent
report of condition so published.
(b) If at any time the Property Trustee shall cease to be
eligible to so act under Section 5.3(a), the Property Trustee shall immediately
resign in the manner and with the effect set forth in Section 5.6(c).
(c) If the Property Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Property Trustee and the Holder of the Common Securities
(as if it were the obligor referred to in Section 310(b) of the Trust
Indenture Act) shall in all respects comply with the provisions of Section
310(b) of the Trust Indenture Act.
(d) The Capital Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause (i) of the
first provision contained in Section 310(b) of the Trust Indenture Act.
SECTION 5.4 Qualifications of Regular Trustees and
Delaware Trustee Generally.
Each Regular Trustee and the Delaware Trustee (unless the
Property Trustee also acts as Delaware Trustee) shall be either a natural person
who is at least 21 years of age or a legal entity that shall act through one or
more Authorized Officers.
SECTION 5.5 Initial Trustees.
The initial Regular Trustees shall be:
Robert C. McPhillips
c/o International Paper Company
Two Manhattanville Road
Purchase, New York 10577
Roger Becker
c/o International Paper Company
Two Manhattanville Road
Purchase, New York 10577
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Virginia A. Lane
c/o International Paper Company
Two Manhattanville Road
Purchase, New York 10577
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
White Clay Center, Route 273
Newark, Delaware 19711
Attention: Corporate Trust Trustee Administration
The initial Property Trustee shall be:
The Bank of New York
101 Barclay Street
21st Floor - West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
SECTION 5.6 Appointment, Removal and Resignation of
Trustees.
(a) Subject to Section 5.6(b), Trustees may be appointed or
removed without cause at any time:
(i) until the issuance of any Securities, by written
instrument executed by the Sponsor; and
(ii) after the issuance of any Securities by vote of the
Holders of a Majority in Liquidation Amount of the Common
Securities voting as a class at a meeting of the Holders of the
Common Securities.
(b) The Trustee that acts as Property Trustee shall not be
removed in accordance with Section 5.6(a) until a successor Property Trustee
(the "Successor Property Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Property Trustee
and delivered to the Regular Trustees and the Sponsor; and
(c) The Trustee that acts as Delaware Trustee shall not be
removed in accordance with this Section 5.6(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections 5.2 and
5.4 (a "Successor Delaware Trustee") has been appointed and has
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accepted such appointment by written instrument executed by such Successor
Delaware Trustee and delivered to the Regular Trustees and the Sponsor.
(d) A Trustee appointed to office shall hold office until his
successor shall have been appointed or until his death, removal or resignation.
Any Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing signed by the Trustee and delivered to
the Sponsor and the Trust, which resignation shall take effect upon such
delivery or upon such later date as is specified therein; provided, however,
that:
(i) No such resignation of the Trustee that acts as the
Property Trustee shall be effective:
(A) until a Successor Property Trustee has been
appointed and has accepted such appointment by instrument
executed by such Successor Property Trustee and delivered to
the Trust, the Sponsor and the resigning Property Trustee; or
(B) until the assets of the Trust have been
completely liquidated and the proceeds thereof distributed to
the holders of the Securities; and
(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor Delaware
Trustee has been appointed and has accepted such appointment by
instrument executed by such Successor Delaware Trustee and
delivered to the Trust, the Sponsor and the resigning Delaware
Trustee.
(e) The Holders of the Common Securities shall use their best
efforts to promptly appoint a Successor Property Trustee or Successor Delaware
Trustee, as the case may be, if the Property Trustee or the Delaware Trustee
delivers an instrument of resignation in accordance with this Section 5.6.
(f) If no Successor Property Trustee or Successor Delaware
Trustee shall have been appointed and accepted appointment as provided in this
Section 5.6 within 60 days after delivery to the Sponsor and the Trust of an
instrument
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of resignation, the resigning Property Trustee or Delaware Trustee, as
applicable, may petition any court of competent jurisdiction for appointment of
a Successor Property Trustee or Successor Delaware Trustee. Such court may
thereupon, after prescribing such notice, if any, as it may deem proper and
prescribe, appoint a Successor Property Trustee or Successor Delaware Trustee,
as the case may be.
SECTION 5.7 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 5.1, or if the number of
Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by a majority of the Regular
Trustees shall be conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance with Section 5.6.
SECTION 5.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to annul the Trust. Whenever a vacancy in the number
of Regular Trustees shall occur, until such vacancy is filled by the appointment
of a Regular Trustee in accordance with Section 5.6, the Regular Trustees in
office, regardless of their number, shall have all the powers granted to the
Regular Trustees and shall discharge all the duties imposed upon the Regular
Trustees by this Declaration.
SECTION 5.9 Meetings.
Meetings of the Regular Trustees shall be held from time to
time upon the call of any Regular Trustee. Regular meetings of the Regular
Trustees may be held at a time and place fixed by resolution of the Regular
Trustees. Notice of any in-person meetings of the Regular Trustees shall be hand
delivered or otherwise delivered in writing (including by facsimile, with a hard
copy by overnight courier) not less than 48 hours before such meeting. Notice of
any telephonic meetings of the Regular Trustees or any committee thereof shall
be hand delivered or otherwise delivered in writing (including by facsimile,
with a hard
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copy by overnight courier) not less than 24 hours before a meeting. Notices
shall contain a brief statement of the time, place and anticipated purposes of
the meeting. The presence (whether in person or by telephone) of a Regular
Trustee at a meeting shall constitute a waiver of notice of such meeting except
where a Regular Trustee attends a meeting for the express purpose of objecting
to the transaction of any activity on the ground that the meeting has not been
lawfully called or convened. Unless provided otherwise in this Declaration, any
action of the Regular Trustees may be taken at a meeting by vote of a majority
of the Regular Trustees present (whether in person or by telephone) and eligible
to vote with respect to such matter, provided that a Quorum is present, or
without a meeting by the unanimous written consent of the Regular Trustees.
SECTION 5.10 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consistent
with applicable law, delegate to any other natural person over the age of 21 his
or her power for the purpose of executing any documents contemplated in Section
3.6, including any registration statement or amendment thereto filed with the
Commission, or making any other governmental filing; and
(b) the Regular Trustees shall have power to delegate from
time to time to such of their number or to officers of the Trust the doing of
such things and the execution of such instruments either in the name of the
Trust or the names of the Regular Trustees or otherwise as the Regular Trustees
may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of the Trust, as set forth herein.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions (as defined herein) in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Capital Securities and the Common Securities
in accordance with the preferences set forth in their respective terms (See
Exhibit A-1 and Exhibit A-2 hereto).
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If and to the extent that the Debenture Issuer makes a payment of interest
(including Compounded Interest (as defined in the Indenture) and Additional
Interest (as defined in the Indenture)) premium and principal on the Debentures
held by the Property Trustee (the amount of any such payment being a "Payment
Amount"), the Property Trustee shall and is directed, to the extent funds are
available for that purpose, to make a distribution (a "Distribution") of the
Payment Amount to Holders.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Regular Trustees shall on behalf of the Trust issue
one class of Capital Securities, representing undivided beneficial interests in
the assets of the Trust (the "Capital Securities"), having such terms (the
"Terms") as are set forth in Annex I and one class of common securities,
representing undivided beneficial interests in the assets of the Trust (the
"Common Securities"), having such terms as are set forth in Annex I. The Trust
shall have no securities or other interests in the assets of the Trust other
than the Capital Securities and the Common Securities. The Trust shall issue no
Securities in bearer form.
(b) The consideration received by the Trust for the issuance
of the Securities shall constitute a contribution to the capital of the Trust
and shall not constitute a loan to the Trust.
(c) Upon issuance of the Securities as provided in this
Declaration, the Securities so issued shall be deemed to be validly issued,
fully paid and non-assessable, subject to Section 10.1 with respect to the
Common Securities.
(d) Every Person, by virtue of having become a Holder or a
Capital Security Beneficial Owner in accordance with the terms of this
Declaration, shall be deemed to have expressly assented and agreed to the terms
of, and shall be bound by, this Declaration.
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SECTION 7.2 Execution and Authentication.
(a) The Securities shall be signed on behalf of the Trust by
one Regular Trustee. In case any Regular Trustee of the Trust who shall have
signed any of the Securities shall cease to be such Regular Trustee before the
Securities so signed shall be delivered by the Trust, such Securities
nevertheless may be delivered as though the person who signed such Securities
had not ceased to be such Regular Trustee; and any Securities may be signed on
behalf of the Trust by such persons who, at the actual date of execution of such
Security, shall be the Regular Trustees of the Trust, although at the date of
the execution and delivery of the Declaration any such person was not such a
Regular Trustee.
(b) One Regular Trustee shall sign the Capital Securities for
the Trust by manual or facsimile signature. Unless otherwise determined by the
Trust, such signature shall, in the case of Common Securities, be a manual
signature.
A Capital Security shall not be valid until authenticated by
the manual signature of an authorized officer of the Property Trustee. The
signature shall be conclusive evidence that the Capital Security has been
authenticated under this Declaration.
Upon a written order of the Trust signed by one Regular
Trustee, the Property Trustee shall authenticate the Capital Securities for
original issue. The aggregate number of Capital Securities outstanding at any
time shall not exceed the number set forth in the Terms in Annex I hereto,
except as provided in Section 7.7.
The Property Trustee may appoint an authenticating agent
acceptable to the Trust to authenticate Capital Securities. An authenticating
agent may authenticate Capital Securities whenever the Property Trustee may do
so. Each reference in this Declaration to authentication by the Property Trustee
includes authentication by such agent. An authenticating agent has the same
rights as the Property Trustee to deal with the Sponsor or an Affiliate.
SECTION 7.3 [RESERVED].
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SECTION 7.4 Registrar, Paying Agent and Conversion Agent.
In the event that the Capital Securities are not in book-entry
only form, the Trust shall maintain in the Borough of Manhattan, City of New
York, State of New York, (i) an office or agency where Capital Securities may be
presented for registration of transfer or exchange ("Registrar"), (ii) an office
or agency where Capital Securities may be presented for payment ("Paying
Agent"). The Registrar shall keep a register of the Capital Securities and of
their transfer and exchange. The Trust may appoint the Registrar, the Paying
Agent and the Conversion Agent and may appoint one or more co-registrars, one or
more additional paying agents and one or more additional conversion agents in
such other locations as it shall determine. The term "Paying Agent" includes any
additional paying agent. The Trust may change any Paying Agent, Registrar or
co-registrar without prior notice to any Holder. The Trust shall notify the
property Trustee of the name and address of any Agent not a party to this
Declaration. If the Trust fails to appoint or maintain another entity as
Registrar or Paying Agent, the Property Trustee shall act as such. The Trust or
any of its Affiliates may act as Paying Agent or Registrar. The Trust shall act
as Paying Agent, Registrar or co-registrar for the Common Securities.
The Trust initially appoints the Property Trustee as Registrar
and Paying Agent for the Capital Securities.
SECTION 7.5 Paying Agent to Hold Money in Trust.
The Trust shall require each Paying Agent other than the
Property Trustee to agree in writing that the Paying Agent will hold in trust
for the benefit of Holders or the Property Trustee all money held by the Paying
Agent for the payment of principal or distribution on the Securities, and will
notify the Property Trustee if there are insufficient funds. While any such
insufficiency continues, the Property Trustee may require a Paying Agent to pay
all money held by it to the Property Trustee. The Trust at any time may require
a Paying Agent to pay all money held by it to the Property Trustee and to
account for any money disbursed by it. Upon payment over to the Property
Trustee, the Paying Agent (if other than the Trust or an Affiliate of the Trust)
shall have no further liability for the money. If the Trust or the Sponsor or an
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Affiliate of the Trust or the Sponsor acts as Paying Agent, it shall segregate
and hold in a separate trust fund for the benefit of the Holders all money held
by it as Paying Agent.
SECTION 7.6 [RESERVED].
SECTION 7.7 [RESERVED].
SECTION 7.8 Outstanding Capital Securities.
The Capital Securities outstanding at any time are all the
Capital Securities authenticated by the Property Trustee except for those
canceled by it, those delivered to it for cancellation, and those described in
this Section as not outstanding.
If a Capital Security is replaced, paid or purchased pursuant
to Section 7.7 hereof, it ceases to be outstanding unless the Property Trustee
receives proof satisfactory to it that the replaced, paid or purchased Capital
Security is held by a bona fide purchaser.
If Capital Securities are considered paid in accordance with
the terms of this Declaration, they cease to be outstanding and interest on them
ceases to accrue.
A Capital Security does not cease to be outstanding because
one of the Trust, the Sponsor or an Affiliate of the Sponsor holds the Security.
SECTION 7.9 Capital Securities in Treasury.
In determining whether the Holders of the required amount of
Securities have concurred in any direction, waiver or consent, Capital
Securities owned by the Trust, the Sponsor or an Affiliate of the Sponsor, as
the case may be, shall be disregarded and deemed not to be outstanding, except
that for the purposes of determining whether the Property Trustee shall be
protected in relying on any such direction, waiver or consent, only Securities
which the Property Trustee knows are so owned shall be so disregarded.
SECTION 7.10 [RESERVED].
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SECTION 7.11 Cancellation.
The Trust at any time may deliver Capital Securities to the
Property Trustee for cancellation. The Registrar, Paying Agent and Conversion
Agent shall forward to the Property Trustee any Capital Securities surrendered
to them for registration of transfer, redemption, conversion, exchange or
payment. The Property Trustee shall promptly cancel all Capital Securities,
surrendered for registration of transfer, redemption, conversion, exchange,
payment, replacement or cancellation and shall dispose of cancelled Capital
Securities as the Trust directs. The Trust may not issue new Capital Securities
to replace Capital Securities that it has paid or that have been delivered to
the Property Trustee for cancellation or that any holder has converted.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.
(a) The Trust shall terminate upon the earliest to occur of
the following:
(i) the bankruptcy of the Holder of the Common
Securities or the Sponsor;
(ii) the filing of a certificate of dissolution or its
equivalent with respect to the Holder of the Common Securities or
the Sponsor; the filing of a certificate of cancellation with
respect to the Trust or the revocation of the charter of the
Holder of the Common Securities or the Sponsor and the expiration
of 90 days after the date of revocation without a reinstatement
thereof;
(iii) the entry of a decree of judicial dissolution of
the Holder of the Common Securities, the Sponsor or the Trust;
(iv) all of the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall
have been paid to the Holders in accordance with the terms of the
Securities;
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(v) the occurrence and continuation of a Tax Event
pursuant to which the Trust shall have been dissolved in
accordance with the terms of the Securities and all of the
Debentures endorsed thereon shall have been distributed to the
Holders of Securities in exchange for all of the Securities; or
(vi) the expiration of the term of the Trust on August
28, 2047.
(b) As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a), the Trustees shall file a certificate of
cancellation with the Secretary of State of the State of Delaware.
(c) The provisions of Section 3.9 and Article X shall survive
the termination of the Trust.
ARTICLE IX
TRANSFER AND EXCHANGE
SECTION 9.1 General.
(a) Where Capital Securities are presented to the Registrar or
a co-registrar with a request to register a transfer or to exchange them for an
equal number of Capital Securities represented by different certificates, the
Registrar shall register the transfer or make the exchange if its requirements
for such transactions are met. To permit registrations of transfers and
exchanges, the Trust shall issue and the Property Trustee shall authenticate
Capital Securities at the Registrar's request.
(b) Securities may only be transferred, in whole or in part,
in accordance with the terms and conditions set forth in this Declaration and in
the terms of the Securities. Any transfer or purported transfer of any Security
not made in accordance with this Declaration shall be null and void.
Subject to this Article IX, the Sponsor and any Related Party
may only transfer Common Securities to the Sponsor or a Related Party of the
Sponsor; provided that, any such transfer is subject to the condition precedent
that the transferor obtain the written opinion of nationally recognized
independent counsel experienced in such matters
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that such transfer would not cause more than an insubstantial risk that:
(i) the Trust would not be classified for United States
Federal income tax purposes as a grantor trust; and
(ii) the Trust would be an Investment Company or the
transferee would become an Investment Company.
(c) The Regular Trustees shall provide for the registration of
Securities and of transfers of Securities, which will be effected without charge
but only upon payment (with such indemnity as the Regular Trustees may require)
in respect of any tax or other governmental charges that may be imposed in
relation to it. Upon surrender for registration of transfer of any Securities,
the Regular Trustees shall cause one or more new Securities to be issued in the
name of the designated transferee or transferees. Every Security surrendered for
registration of transfer shall be accompanied by a written instrument of
transfer in form satisfactory to the Regular Trustees duly executed by the
Holder or such Holder's attorney duly authorized in writing. Each Security
surrendered for registration of transfer shall be canceled by the Regular
Trustees. A transferee of a Security shall be entitled to the rights and subject
to the obligations of a Holder hereunder upon the receipt by such transferee of
a Security. By acceptance of a Security, each transferee shall be deemed to have
agreed to be bound by this Declaration.
(d) The Trust shall not be required (i) to issue, register the
transfer of, or exchange, Capital Securities during a period beginning at the
opening of business 15 days before the day of any selection of Capital
Securities for redemption set forth in the terms and ending at the close of
business on the day of selection, or (ii) to register the transfer or exchange
of any Capital Security so selected for redemption in whole or in part, except
the unredeemed portion of any Capital Security being redeemed in part.
SECTION 9.2 Transfer of Certificates.
The Regular Trustees shall provide for the registration of
Certificates and of transfers of Certificates, which will be effected without
charge but only upon payment (with such indemnity as the Regular Trustees or
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the Registrar may require) in respect of any tax or other government charges
that may be imposed in relation to it. Upon surrender for registration of
transfer of any Certificate, the Regular Trustees shall cause one or more new
Certificates to be issued in the name of the designated transferee or
transferees. Every Certificate surrendered for registration of transfer shall be
accompanied by a written instrument of transfer in form satisfactory to the
Regular Trustees and the Registrar duly executed by the Holder or such Holder's
attorney duly authorized in writing. Each Certificate surrendered for
registration of transfer shall be cancelled by the Registrar. A transferee of a
Certificate shall be entitled to the rights and subject to the obligations of a
Holder hereunder upon the receipt by such transferee of a Certificate. By
acceptance of a Certificate, each transferee shall be deemed to have agreed to
be bound by this Declaration.
SECTION 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any
Certificate shall be registered on the books and records of the Trust as the
sole holder of such Certificate and of the Securities represented by such
Certificate for purposes of receiving Distributions and for all other purposes
whatsoever and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Certificate or in the Securities represented
by such Certificate on the part of any Person, whether or not the Trust, the
Property Trustee, the Registrar or an co-registrar shall have actual or other
notice thereof.
SECTION 9.4 Book Entry Interests.
Unless otherwise specified in the terms of the Capital
Securities, the Capital Securities Certificates, on original issuance, will be
issued in the form of one or more, fully registered, global Capital Security
Certificates (each a "Global Certificate"), to be delivered to the Depositary,
the initial Clearing Agency, by, or on behalf of, the Trust. Such Global
Certificates shall initially be registered on the books and records of the Trust
in the name of Cede & Co., the nominee of the Depositary, and no Capital
Security Beneficial Owner will receive a Definitive Capital Security Certificate
representing such Capital Security Beneficial Owner's interests in such Global
Certificates, except as provided in Section 9.7. Unless and until
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definitive, fully registered Capital Security Certificates (the "Definitive
Capital Security Certificates") have been issued to the Capital Security
Beneficial Owners pursuant to
Section 9.7:
(a) the provisions of this Section 9.4 shall be in full force
and effect;
(b) the Trust and the Trustees shall be entitled to deal with
the Depositary for all purposes of this Declaration (including the payment of
Distributions on the relevant Global Certificates and receiving approvals, votes
or consents hereunder) as the Holder of the Capital Securities and the sole
holder of the Global Certificates and shall have no obligation to the Capital
Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.4
conflict with any other provisions of this Declaration, the provisions of this
Section 9.4 shall control; and
(d) the rights of the Capital Security Beneficial Owners shall
be exercised only through the Depositary and shall be limited to those
established by law and agreements between such Capital Security Beneficial
Owners and the Depositary and/or the Participants and receive and transmit
payments of Distributions on the Global Certificates to such Participants. The
Depositary will make book entry transfers among the Participants.
SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Capital
Security Holders is required under this Declaration, unless and until Definitive
Capital Security Certificates shall have been issued to the Capital Security
Beneficial Owners pursuant to Section 9.7, the Regular Trustees shall give all
such notices and communications specified herein to be given to the Capital
Security Holders to the Depositary, and shall have no notice obligations to the
Capital Security Beneficial Owners.
SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its
services as securities depositary with respect to the
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Capital Securities, the Regular Trustees may, in their sole discretion, appoint
a successor Clearing Agency with respect to such Capital Securities.
SECTION 9.7 Definitive Capital Security Certificates.
If:
(a) a Clearing Agency notifies the Sponsor and the Trust that
it elects to discontinue its services as securities depositary with respect to
the Capital Securities or if at any time such Clearing Agency ceases to be a
"clearing agency" registered under the Exchange Act and a successor Clearing
Agency is not appointed within 90 days after such discontinuance pursuant to
Section 9.6; or
(b) the Regular Trustees elect after consultation with the
Sponsor and the Trust to terminate the book entry system through the Clearing
Agency with respect to the Capital Securities; or
(c) an Event of Default has occurred and is continuing, then:
(d) Definitive Capital Security Certificates shall be prepared
by the Regular Trustees on behalf of the Trust with respect to such Capital
Securities; and
(e) Upon surrender of the Global Certificates by the Clearing
Agency, accompanied by registration instructions, the Regular Trustees shall
cause Definitive Capital Security Certificates to be executed and authenticated
in accordance with the provisions of Section 7.2 hereof and delivered to Capital
Security Beneficial Owners in accordance with the instructions of the Clearing
Agency. Neither the Trustees nor the Trust shall be liable for any delay in
delivery of such instructions and each of them may conclusively rely on and
shall be protected in relying on, said instructions of the Clearing Agency. The
Definitive Capital Security Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Regular Trustees, as evidenced by their execution thereof, and may have such
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letters, numbers or other marks of identification or designation and such
legends or endorsements as the Regular Trustees may deem appropriate, or as may
be required to comply with any law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which Capital
Securities may be listed, or to conform to usage.
SECTION 9.8 Mutilated, Destroyed, Lost or Stolen
Certificates.
If:
(a) any mutilated Certificates should be surrendered to the
Regular Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such
security or indemnity as may be required by them to keep each of them harmless,
then, in the absence of notice that such Certificate shall have been acquired by
a bona fide purchaser, any Regular Trustee on behalf of the Trust shall execute
and, upon a written order of the Trust signed by one Regular Trustee, the
Property Trustee shall authenticate and deliver, in exchange for or in lieu of
any such mutilated, destroyed, lost or stolen Certificate, a new Certificate of
like denomination. In connection with the issuance of any new Certificate under
this Section 9.8, the Regular Trustees may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith. Any duplicate Certificate issued pursuant to this Section
9.8 shall constitute conclusive evidence of an ownership interest in the
relevant Securities, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
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ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration, the
Capital Securities Guarantee, the Common Securities Guarantee and the terms of
the Securities the Sponsor shall not be:
(i) personally liable for the return of any portion of
the capital contributions (or any return thereon) of the Holders
of the Securities which shall be made solely from assets of the
Trust; and
(ii) be required to pay to the Trust or to any Holder of
Securities any deficit upon dissolution of the Trust or otherwise.
(b) The Holder of the Common Securities shall be liable for
all of the debts and obligations of the Trust (other than with respect to the
Securities) to the extent not satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act, the
Holders of the Capital Securities shall be entitled to the same limitation of
personal liability extended to stockholders of private corporations for profit
organized under the General Corporation Law of the State of Delaware.
SECTION 10.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's gross negligence (or, in
the case of the Property Trustee, negligence) or willful misconduct with respect
to such acts or omissions.
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(b) An Indemnified Person shall be fully protected in relying
in good faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Trust, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Securities might properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified
Person has duties (including fiduciary duties) and liabilities relating thereto
to the Trust or to any other Covered Person, an Indemnified Person acting under
this Declaration shall not be liable to the Trust or to any other Covered Person
for its good faith reliance on the provisions of this Declaration. The
provisions of this Declaration, to the extent that they restrict the duties and
liabilities of an Indemnified Person otherwise existing at law or in equity
(other than the duties imposed on the Property Trustee under the Trust Indenture
Act), are agreed by the parties hereto to replace such other duties and
liabilities of such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises
between an Indemnified Person and any Covered Person; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified Person
shall act in a manner that is, or provides terms that are, fair
and reasonable to the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens
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relating to such interests, any customary or accepted industry practices, and
any applicable generally accepted accounting practices or principles. In the
absence of bad faith by the Indemnified Person, the resolution, action or term
so made, taken or provided by the Indemnified Person shall not constitute a
breach of this Declaration or any other agreement contemplated herein or of any
duty or obligation of the Indemnified Person at law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is
permitted or required to make a decision
(i) in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to consider
such interests and factors as it desires, including its own
interests, and shall have no duty or obligation to give any
consideration to any interest of or factors affecting the Trust or
any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such express
standard and shall not be subject to any other or different
standard imposed by this Declaration or by applicable law.
SECTION 10.4 Indemnification.
(a) To the fullest extent permitted by applicable law, the
Sponsor shall indemnify and hold harmless each Indemnified Person from and
against any loss, damage, liability, tax, penalty, expense or claim of any kind
or nature whatsoever incurred by such Indemnified Person by reason of the
creation, operation or termination of the Trust or any act or omission performed
or omitted by such Indemnified Person in good faith on behalf of the Trust and
in a manner such Indemnified Person reasonably believed to be within the scope
of authority conferred on such Indemnified Person by this Declaration, except
that no Indemnified Person shall be entitled to be indemnified in respect of any
loss, damage or claim incurred by such Indemnified Person by reason of gross
negligence (or, in the case of the Property Trustee, negligence) or willful
misconduct with respect to such acts or omissions.
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(b) To the fullest extent permitted by applicable law,
expenses (including legal fees and expenses) incurred by an Indemnified Person
in defending any claim, demand, action, suit or proceeding shall, from time to
time, be advanced by the Sponsor prior to the final disposition of such claim,
demand, action, suit or proceeding upon receipt by the Sponsor of an undertaking
by or on behalf of the Indemnified Person to repay such amount if it shall be
determined that the Indemnified Person is not entitled to be indemnified as
authorized in Section 10.4(a). The indemnification shall survive the termination
of this Declaration.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the
Property Trustee may engage in or possess an interest in other business ventures
of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom and the pursuit
of any such venture, even if competitive with the business of the Trust, shall
not be deemed wrongful or improper. No Covered Person, the Sponsor, the Delaware
Trustee, or the Property Trustee shall be obligated to present any particular
investment or other opportunity to the Trust even if such opportunity is of a
character that, if presented to the Trust, could be taken by the Trust, and any
Covered Person, the Sponsor, the Delaware Trustee and the Property Trustee shall
have the right to take for its own account (individually or as a partner or
fiduciary) or to recommend to others any such particular investment or other
opportunity. Any Covered Person, the Delaware Trustee and the Property Trustee
may engage or be interested in any financial or other transaction with the
Sponsor or any Affiliate of the Sponsor, or may act as depositary for, trustee
or agent for, or act on any committee or body of holders of, securities or other
obligations of the Sponsor or its Affiliates.
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ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the
Regular Trustees shall keep, or cause to be kept, full books of account, records
and supporting documents, which shall reflect in reasonable detail, each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting
principles, consistently applied. The Trust shall use the accrual method of
accounting for United States Federal income tax purposes. The books of account
and the records of the Trust shall be examined by and reported upon as of the
end of each Fiscal Year by a firm of independent certified public accountants
selected by the Regular Trustees.
(b) The Regular Trustees shall cause to be prepared and
delivered to each of the Holders of Securities, within 90 days after the end of
each Fiscal Year of the Trust, annual financial statements of the Trust,
including a balance sheet of the Trust as of the end of such Fiscal Year, and
the related statements of income or loss;
(c) The Regular Trustees shall cause to be duly prepared and
delivered to each of the Holders of Securities, any annual United States Federal
income tax information statement, required by the Code, containing such
information with regard to the Securities held by each Holder as is required by
the Code and the Treasury Regulations. Notwithstanding any right under the Code
to deliver any such statement at a later date, the Regular Trustees shall
endeavor to deliver all such statements within 30 days after the end of each
Fiscal Year of the Trust.
(d) The Regular Trustees shall cause to be duly prepared and
filed with the appropriate taxing authority, an annual United States Federal
income tax return, on a Form 1041 or such other form required by United States
Federal
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income tax law, and any other annual income tax returns required to be filed by
the Regular Trustees on behalf of the Trust with any state or local taxing
authority.
SECTION 11.3 Banking.
The Trust shall maintain one or more bank accounts in the name
and for the sole benefit of the Trust; provided, however, that all payments of
funds in respect of the Debentures held by the Property Trustee shall be made
directly to the Property Trustee Account and no other funds of the Trust shall
be deposited in the Property Trustee Account. The sole signatories for such
accounts shall be designated by the Regular Trustees; provided, however, that
the Property Trustee shall designate the signatories for the Property Trustee
Account.
SECTION 11.4 Withholding.
The Trust and the Regular Trustees shall comply with all
withholding requirements under United States Federal, state and local law. The
Trust shall request, and the Holders shall provide to the Trust, such forms or
certificates as are necessary to establish an exemption from withholding with
respect to each Holder, and any representations and forms as shall reasonably be
requested by the Trust to assist it in determining the extent of, and in
fulfilling, its withholding obligations. The Regular Trustee shall file required
forms with applicable jurisdictions and, unless an exemption from withholding is
properly established by a Holder, shall remit amounts withheld with respect to
the Holder to applicable jurisdictions. To the extent that the Trust is required
to withhold and pay over any amounts to any authority with respect to
distributions or allocations to any Holder, the amount withheld shall be deemed
to be a distribution in the amount of the withholding to the Holder. In the
event of any claimed over withholding, Holders shall be limited to an action
against the applicable jurisdiction. If the amount required to be withheld was
not withheld from actual Distributions made, the Trust may reduce subsequent
Distributions by the amount of such withholding.
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ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may only be amended by a
written instrument approved and executed by:
(i) the Regular Trustees (or, if there are more than two
Regular Trustees a majority of the Regular Trustees);
(ii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Property Trustee, the
Property Trustee; and
(iii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware Trustee, the
Delaware Trustee;
(b) no amendment shall be made, and any such purported
amendment shall be void and ineffective:
(i) unless, in the case of any proposed amendment, the
Property Trustee shall have first received an Officers'
Certificate from each of the Trust and the Sponsor that such
amendment is permitted by, and conforms to, the terms of this
Declaration (including the terms of the Securities);
(ii) unless, in the case of any proposed amendment which
affects the rights, powers, duties, obligations or immunities of
the Property Trustee, the Property Trustee shall have first
received:
(A) an Officers' Certificate from each of the Trust
and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the
terms of the Securities); and
(B) an opinion of counsel (who may be counsel to
the Sponsor or the Trust) that such amendment is permitted
by, and conforms to, the
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terms of this Declaration (including the terms of
the Securities); and
(iii) to the extent the result of such amendment would
be to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States Federal income
taxation as a grantor trust;
(B) reduce or otherwise adversely affect the powers
of the Property Trustee in contravention of the Trust
Indenture Act; or
(C) cause the Trust to be deemed to be an
Investment Company required to be registered under the
Investment Company Act;
(c) at such time after the Trust has issued any Securities
that remain outstanding, any amendment that would adversely affect the rights,
privileges or preferences of any Holder of Securities may be effected only with
such additional requirements as may be set forth in the terms of such
Securities;
(d) Section 9.1(c) and this Section 12.1 shall not be amended
without the consent of all of the Holders of the Securities;
(e) Article IV shall not be amended without the consent of the
Holders of a Majority in Liquidation Amount of the Common Securities and;
(f) the rights of the holders of the Common Securities under
Article V to increase or decrease the number of, and appoint and remove Trustees
shall not be amended without the consent of the Holders of a Majority in
Liquidation Amount of the Common Securities; and
(g) notwithstanding Section 12.1(c), this Declaration may be
amended without the consent of the Holders of the Securities to:
(i) cure any ambiguity;
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(ii) correct or supplement any provision in this
Declaration that may be defective or inconsistent with any other
provision of this Declaration;
(iii) add to the covenants, restrictions or obligations
of the Sponsor; and
(iv) conform to any change in Rule 3a-5 or written
change in interpretation or application of Rule 3a-5 by any
legislative body, court, government agency or regulatory authority
which amendment does not have a material adverse effect on the
rights, preferences or privileges of the Holders.
SECTION 12.2 Meetings of the Holders of Securities; Action by Written
Consent.
(a) Meetings of the Holders of any class of Securities may be
called at any time by the Regular Trustees (or as provided in the terms of the
Securities) to consider and act on any matter on which Holders of such class of
Securities are entitled to act under the terms of this Declaration, the terms of
the Securities or the rules of any stock exchange on which the Capital
Securities are listed or admitted for trading. The Regular Trustees shall call a
meeting of the Holders of such class if directed to do so by the Holders of at
least 10% in Liquidation Amount of such class of Securities. Such direction
shall be given by delivering to the Regular Trustees one or more requests in a
writing stating that the signing Holders of Securities wish to call a meeting
and indicating the general or specific purpose for which the meeting is to be
called. Any Holders of Securities calling a meeting shall specify in writing the
Certificates held by the Holders of Securities exercising the right to call a
meeting and only those Securities represented by the Certificates so specified
shall be counted for purposes of determining whether the required percentage set
forth in the second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of
the Securities, the following provisions shall apply to meetings of Holders of
Securities:
(i) notice of any such meeting shall be given to all the
Holders of Securities having a right to vote thereat at least 7
days and not more than 60
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days before the date of such meeting. Whenever a vote, consent or
approval of the Holders of Securities is permitted or required
under this Declaration or the rules of any stock exchange on which
the Capital Securities are listed or admitted for trading, such
vote, consent or approval may be given at a meeting of the Holders
of Securities. Any action that may be taken at a meeting of the
Holders of Securities may be taken without a meeting if a consent
in writing setting forth the action so taken is signed by the
Holders of Securities owning not less than the minimum aggregate
Liquidation Amount of Securities that would be necessary to
authorize or take such action at a meeting at which all Holders of
Securities having a right to vote thereon were present and voting.
Prompt notice of the taking of action without a meeting shall be
given to the Holders of Securities entitled to vote who have not
consented in writing. The Regular Trustees may specify that any
written ballot submitted to the Security Holders for the purpose
of taking any action without a meeting shall be returned to the
Trust within the time specified by the Regular Trustees;
(ii) each Holder of a Security may authorize any Person
to act for it by proxy on all matters in which a Holder of
Securities is entitled to participate, including waiving notice of
any meeting, or voting or participating at a meeting. No proxy
shall be valid after the expiration of 11 months from the date
thereof unless otherwise provided in the proxy. Every proxy shall
be revocable at the pleasure of the Holder of Securities executing
it. Except as otherwise provided herein, all matters relating to
the giving, voting or validity of proxies shall be governed by the
General Corporation Law of the State of Delaware relating to
proxies, and judicial interpretations thereunder, as if the Trust
were a Delaware corporation and the Holders of the Securities were
stockholders of a Delaware corporation;
(iii) each meeting of the Holders of the Securities
shall be conducted by the Regular Trustees or by such other Person
that the Regular Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration,
the terms of the Securities, the Trust
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Indenture Act or the listing rules of any stock exchange on which
the Capital Securities are then listed or trading, provide
otherwise, the Regular Trustees, in their sole discretion, shall
establish all other provisions relating to meetings of Holders of
Securities, including notice of the time, place or purpose of any
meeting at which any matter is to be voted on by any Holders of
Securities, waiver of any such notice, action by consent without a
meeting, the establishment of a record date, quorum requirements,
voting in person or by proxy or any other matter with respect to
the exercise of any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee.
The Trustee that acts as initial Property Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration and
at the time of Closing, and each Successor Property Trustee represents and
warrants to the Trust and the Sponsor at the time of the Successor Property
Trustee's acceptance of its appointment as Property Trustee that:
(a) The Property Trustee is a banking corporation with trust
powers, duly organized, validly existing and in good standing under the laws of
the jurisdiction of its organization, with corporate power and authority to
execute and deliver, and to carry out and perform its obligations under the
terms of, the Declaration.
(b) The execution, delivery and performance by the Property
Trustee of the Declaration has been duly authorized by all necessary corporate
action on the part of the Property Trustee. The Declaration has been duly
executed and delivered by the Property Trustee, and constitutes a legal, valid
and binding obligation of the Property Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' rights
generally and to general principles of equity and the discretion of the court
(regardless of
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whether the enforcement of such remedies is considered in a proceeding in equity
or at law).
(c) The execution, delivery and performance of the Declaration
by the Property Trustee does not conflict with or constitute a breach of the
certificate of incorporation or By-laws of the Property Trustee.
(d) At the Closing Date, the Property Trustee will have valid
ownership interest in the Debentures for the benefit of the holders of the
Securities in each case free from liens, encumbrances and defects.
(e) No consent, approval or authorization of, or registration
with or notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Property Trustee, of the Declaration.
SECTION 13.2 Representations and Warranties of Delaware
Trustee.
The Trustee that acts as initial Delaware Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration and
at the time of Closing, and each Successor Delaware Trustee represents and
warrants to the Trust and the Sponsor at the time of the Successor Property
Trustee's acceptance of its appointment as Delaware Trustee that:
(a) The Delaware Trustee is a banking corporation with trust
powers, duly organized, validly existing and in good standing under the laws of
the jurisdiction of its organization, with corporate power and authority to
execute and deliver, and to carry out and perform its obligations under the
terms of, the Declaration.
(b) The execution, delivery and performance by the Delaware
Trustee of the Declaration has been duly authorized by all necessary corporate
action on the part of the Delaware Trustee. The Declaration has been duly
executed and delivered by the Delaware Trustee, and constitutes a legal, valid
and binding obligation of the Delaware Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' rights
generally and to general principles of equity and the discretion of the court
(regardless of
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whether the enforcement of such remedies is considered in a proceeding in equity
or at law).
(c) The execution, delivery and performance of the Declaration
by the Delaware Trustee does not conflict with or constitute a breach of the
certificate of incorporation or By-laws of the Delaware Trustee.
(d) No consent, approval or authorization of, or registration
with or notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Delaware Trustee, of the Declaration.
(e) The Delaware Trustee is an entity which has its principal
place of business in the State of Delaware.
(f) The Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and the Declaration. The Declaration
under Delaware law constitutes a legal, valid and binding obligation of the
Delaware Trustee, enforceable against it in accordance with its terms, subject
to applicable bankruptcy, reorganization, moratorium, insolvency, and other
similar laws affecting creditors' rights generally and to general principles of
equity and the discretion of the court (regardless of whether the enforcement of
such remedies is considered in a proceeding in equity or at law).
ARTICLE XIV
[RESERVED]
ARTICLE XV
MISCELLANEOUS
SECTION 15.1 Notices.
All notices provided for in this Declaration shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular
Trustees at the Trust's mailing address set forth below (or
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such other address as the Trust may give notice of to the Holders of the
Securities):
c/o International Paper Company
Two Manhattanville Road
Purchase, New York 10577
Attention: John R. Jepsen
(b) if given to the Property Trustee, at the mailing address
set forth below (or such other address as the Property Trustee may give notice
of to the Holders of the Securities):
The Bank of New York
101 Barclay Street
21st Floor - West
Attention: Corporate Trust Trustee
Administration
(c) if given to the Holder of the Common Securities, at the
mailing address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice to the Trust):
International Paper Company
Two Manhattanville Road
Purchase, New York 10577
Attention: Office of the Secretary
(d) if given to any other Holder, at the address set forth on
the books and records of the Trust or the Registrar, as applicable.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 15.2 Governing Law.
This Declaration and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and
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remedies shall be governed by such laws without regard to principles of conflict
of laws.
SECTION 15.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be
classified for United States Federal income tax purposes as a grantor trust. The
provisions of this Declaration shall be interpreted to further this intention of
the parties.
SECTION 15.4 Headings.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
SECTION 15.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be deemed
to be included, and all covenants and agreements in this Declaration by the
Sponsor and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
SECTION 15.6 Partial Enforceability.
If any provision of this Declaration, or the application of
such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to persons
or circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 15.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
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IN WITNESS WHEREOF, the undersigned has caused these presents
to be executed as of the day and year first above written.
Robert C. McPhillips,
as Regular Trustee
/s/ Robert C. McPhillips
--------------------------------------
Roger Becker,
as Regular Trustee
/s/ Roger Becker
--------------------------------------
Virginia A. Lane,
as Regular Trustee
/s/ Virginia A. Lane
--------------------------------------
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By: /s/ Fred Clark
----------------------------------
Name: Fred Clark
Title: Vice President
THE BANK OF NEW YORK,
as Property Trustee
By: /s/ Mary LaGumina
--------------------------------
Name: Mary LaGumina
Title: Assistant Vice President
INTERNATIONAL PAPER COMPANY,
as Sponsor
By: /s/ E. William Boehmler
--------------------------------
Name: E. William Boehmler
Title: Vice President and Treasurer
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ANNEX I
TERMS OF SECURITIES
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EXHIBIT A-1
FORM OF CAPITAL SECURITY
<PAGE>
EXHIBIT A-2
FORM OF COMMON SECURITY
<PAGE>
EXHIBIT B
SPECIMEN OF DEBENTURE
<PAGE>
EXHIBIT C
UNDERWRITING AGREEMENT
<PAGE>
ANNEX I
TERMS OF
7 7/8% CAPITAL SECURITIES
7 7/8% COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated
Declaration of Trust, dated as of September 24, 1998 (as amended from time to
time, the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Capital Securities and the
Common Securities are set out below (each capitalized term used but not defined
herein has the meaning set forth in the Declaration or, if not defined in such
Declaration, as defined in the Prospectus Supplement referred to below):
1. Designation and Number.
(a) "Capital Securities." 28,000,000 Capital Securities of
the Trust with an aggregate Liquidation Amount with
respect to the assets of the Trust of Seven Hundred
Million Dollars ($700,000,000), plus up to an
additional 4,200,000 Capital Securities of the Trust
with an aggregate Liquidation Amount with respect to
the assets of the Trust of One Hundred and Five Million
Dollars ($105,000,000) solely to cover over-allotments,
as provided for in the Underwriting Agreement (the
"Additional Capital Securities"), and a Liquidation
Amount with respect to the assets of the Trust of $25
per Capital Security, are hereby designated for the
purposes of identification only as "7 7/8% Capital
Securities (Liquidation Amount $25 per Capital
Security)" (the "Capital Securities"). The Capital
Security Certificates evidencing the Capital Securities
shall be substantially in the form attached hereto as
Exhibit A-1, with such changes and additions thereto or
deletions therefrom as may be required by ordinary
usage, custom or practice or to conform to the rules of
any stock exchange or other organization on which the
Capital Securities are listed.
(b) "Common Securities." 865,980 Common Securities of the Trust
with an aggregate Liquidation Amount with respect to the
assets of the Trust of Twenty One Million Six Hundred and
Forty Nine Thousand Five Hundred Dollars ($21,649,500), plus
up to an additional 129,897 Common
<PAGE>
Securities of the Trust with an aggregate Liquidation Amount
with respect to the assets of the Trust of Three Million Two
Hundred Forty Seven Thousand Four Hundred and Twenty Five
Dollars ($3,247,425) to meet the capital requirements of the
Trust in the event of an issuance of Additional Capital
Securities, and a Liquidation Amount with respect to the
assets of the Trust of $25 per Common Security, are hereby
designated for the purposes of identification only as "7 7/8%
Common Securities (Liquidation Amount $25 per Common
Security)" (the "Common Securities"). The Common Security
Certificates evidencing the Common Securities shall be
substantially in the form attached hereto as Exhibit A-2, with
such changes and additions thereto or deletions therefrom as
may be required by ordinary usage, custom or practice.
2. Distributions.
(a) Distributions payable on each Security will be fixed at
a rate per annum of 7 7/8% (the "Coupon Rate") of the
stated Liquidation Amount of $25 per Security, such
rate being the rate of interest payable on the
Debentures to be held by the Property Trustee.
Distributions in arrears for more than one quarter will
bear interest thereon compounded quarterly at the
Coupon Rate (to the extent permitted by applicable
law). The term "Distributions" as used herein includes
such cash distributions and any such interest payable
unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of
the Debentures held by the Property Trustee and to the
extent the Property Trustee has funds available
therefor. The amount of Distributions payable for any
period less than a full Distribution period will be
computed on the basis of a 360-day year of twelve
30-day months and the actual days elapsed in a partial
month in such period. Distributions payable for each
full Distribution period will be computed by dividing
the Coupon Rate by four.
(b) Distributions on the Securities will be cumulative,
will accrue from the date of original issuance and will
be payable quarterly in arrears, on the following
dates, which dates correspond to the interest payment
dates on the Debentures: March 1, June 1, September 1,
and December 1, of each year, commencing on December 1,
1998, except as otherwise described below. The
Debenture Issuer has the right under the Indenture (so
long as no Event of Default (as defined in the
Indenture) has occurred or is continuing) to defer
payments of interest by extending the interest payment
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period from time to time on the Debentures for a period not
exceeding 20 consecutive quarterly periods (each an "Extension
Period") and, as a consequence of such deferral, quarterly
Distributions on the Securities will also be deferred. Despite
such deferral, quarterly Distributions will continue to accrue
with interest thereon (to the extent permitted by applicable
law) at the Coupon Rate compounded quarterly during any such
Extension Period from the most recent date on which
Distributions were paid, computed on the basis of a 360-day
year of twelve 30-day months and the actual days elapsed in a
partial month in such period. Additional Distributions payable
for each full Distribution period will be computed by dividing
the Coupon Rate by four. The term "Distributions" shall
include any such additional Distributions. Prior to the
termination of any such Extension Period, the Debenture Issuer
may further extend such Extension Period; provided that such
Extension Period together with all such previous and further
extensions thereof may not exceed 20 consecutive quarterly
periods; and provided, further, that no Extension Period may
extend beyond the stated maturity of the Debentures (as such
stated maturity may be shortened in accordance with the terms
of the Indenture) or end on day other than an Interest Payment
Date (as defined in the Indenture) for the Debentures.
Payments of accrued Distributions will be payable to Holders
as they appear on the books and records of the Trust on the
first record date after the end of the Extension Period. Upon
the termination of any Extension Period and the payment of all
amounts then due, the Debenture Issuer may commence a new
Extension Period, subject to the above requirements.
(c) Distributions on the Securities will be payable to the
Holders thereof as they appear on the books and records
of the Trust on the relevant record dates. The
relevant record dates shall be the close of business on
the 15th calendar day (whether or not a Business Day)
prior to the relevant payment dates, except as
otherwise described in this Annex I to the Declaration.
Subject to any applicable laws and regulations and the
provisions of the Declaration, each such payment in
respect of Capital Securities being held in book-entry
form through The Depository Trust Company (the
"Depositary") will be made as described under the
heading "Description of Capital Securities -- Book-
Entry Procedures, Delivery and Form" in the Prospectus
Supplement. The relevant record dates for the Common
Securities shall be the same record dates as for the
Capital Securities. Distributions payable on any
Securities that are not punctually paid on any
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Distribution payment date, as a result of the Debenture Issuer
having failed to make a payment under the Debentures, will
cease to be payable to the Person in whose name such
Securities are registered on the relevant record date, and
such defaulted Distribution will instead be payable to the
Person in whose name such Securities are registered on the
special record date or other specified date determined in
accordance with the Indenture. If any date on which
Distributions are payable on the Securities is not a Business
Day, then payment of the Distribution payable on such date
will be made on the next succeeding day that is a Business Day
(and without any additional Distributions or other payment in
respect of any such delay) except that, if such Business Day
is in the next succeeding calendar year, such payment shall be
made on the immediately preceding Business Day, in each case
with the same force and effect as if made on the date such
payment was originally payable.
(d) In the event that there is any money or other property held by
or for the Trust that is not accounted for hereunder, such
property shall be distributed Pro Rata (as defined herein)
among the Holders of the Securities.
3. Liquidation Distribution Upon Dissolution.
In the event of any voluntary or involuntary dissolution,
winding-up or termination of the Trust, the Holders of the Securities on the
date of the dissolution, winding-up or termination, as the case may be, will be
entitled to receive out of the assets of the Trust available for distribution to
Holders of Securities after satisfaction of liabilities of creditors of the
trust an amount equal to the aggregate of the stated Liquidation Amount of $25
per Security plus accrued and unpaid Distributions thereon to the date of
payment (such amount being the "Liquidation Distribution"), unless, in
connection with such dissolution, winding-up or termination, Debentures in an
aggregate principal amount equal to the aggregate stated Liquidation Amount of
such Securities, with an interest rate equal to the Coupon Rate of, and bearing
accrued and unpaid interest in an amount equal to the accrued and unpaid
Distributions on, such Securities, shall be distributed on a Pro Rata basis to
the Holders of the Securities in exchange for such Securities.
If, upon any such dissolution, the Liquidation Distribution
can be paid only in part because the Trust has insufficient assets available to
pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by
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the Trust on the Securities shall be paid on a Pro Rata basis in accordance with
paragraph 9 hereof.
4. Redemption and Distribution.
(a) Upon the repayment or payment of the Debentures, if on
or after September 24, 2003, in whole or in part,
whether at maturity or upon earlier redemption as
provided in the Debentures or otherwise, the proceeds
from such repayment or redemption shall be
simultaneously applied to redeem a Like Amount (as
defined below) of the Securities at a redemption price
in cash equal to 100% of the aggregate Liquidation
Amount of such Securities plus accumulated and unpaid
Distributions thereon to the date of redemption (the
"Redemption Date"). Holders will be given not less
than 30 nor more than 60 days' notice of such
redemption. Upon the repayment of the Debentures at
maturity or upon any acceleration, earlier redemption
or otherwise, the proceeds from such repayment will be
applied to redeem the Securities, in whole, upon not
less than 30 nor more than 60 days' notice prior to the
date fixed for repayment or redemption.
(b) If fewer than all the outstanding Securities are to be so
redeemed, the Common Securities and the Capital Securities
will be redeemed Pro Rata and the Capital Securities to be
redeemed will be as described in Paragraph 4(f)(ii) below.
(c) If, prior to September 24, 2003, a Tax Event shall
occur and be continuing the Sponsor shall cause the
Regular Trustees to liquidate the Trust and, after
satisfaction of creditors of the Trust, cause
Debentures to be distributed to the Holders of the
Securities in liquidation of the Trust within 90 days
following the occurrence of such Tax Event (the "90 Day
Period"); provided, however, that such liquidation and
distribution shall be conditioned on (i) the Regular
Trustees' receipt of an opinion of a nationally
recognized independent tax counsel experienced in such
matters (a "No Recognition Opinion"), which opinion may
rely on published revenue rulings of the Internal
Revenue Service, to the effect that the Holders of the
Securities will not recognize any income, gain or loss
for United States Federal income tax purposes as a
result of such liquidation and distribution of
Debentures, and (ii) the Sponsor being unable to avoid
such Tax Event within such 90 Day Period by taking some
ministerial action or pursuing some other reasonable
measure that, in the sole judgment of the Sponsor, will
have no adverse effect on the Trust, the Sponsor or the
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Holders of the Securities and will involve no material cost
("Ministerial Action").
If (i) the Debenture Issuer has received an
opinion of a nationally recognized independent tax counsel
(reasonably acceptable to the Regular Trustees) experienced in
such matters that, as a result of a Tax Event, there is more
than an insubstantial risk that the Debenture Issuer would be
precluded from deducting the interest on the Debentures for
United States Federal income tax purposes, even after the
Debentures were distributed to the Holders of Securities upon
liquidation of the Trust as described in this paragraph 4(c),
or (ii) the Regular Trustees shall have been informed by such
tax counsel that it cannot deliver a No Recognition Opinion,
the Debenture Issuer shall have the right, if prior to
September 24, 2003, upon not less than 30 nor more than 60
days' notice, and within 90 days following the occurrence of
such Tax Event, to redeem the Debentures in whole (but not in
part) for cash, at a redemption price equal to the accrued and
unpaid interest on the Debentures so redeemed to the
Redemption Date, plus 100% of the principal amount thereof,
and the proceeds of such redemption shall be applied by the
Property Trustee to redeem a Like Amount of the Securities
equal to 100% of the aggregate Liquidation Amount of such
Securities plus accumulated and unpaid Distributions thereon
to the Redemption Date; provided, however, that, if at the
time there is available to the Debenture Issuer or the Trust
the opportunity to eliminate, within such 90 Day Period, the
Tax Event by taking some Ministerial Action, the Trust or the
Debenture Issuer will pursue such Ministerial Action in lieu
of redemption.
"Tax Event" means the receipt by the Trust
of an opinion of counsel experienced in such matters, who
shall not be an officer or employee of the Sponsor or any of
its Affiliates, to the effect that, as a result of any
amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the
United States or any political subdivision or taxing authority
thereof or therein, or as a result of any official or
administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which
amendment or change is effective or which pronouncement,
action or decision is announced on or after the date of
issuance of the Capital Securities, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90
days of the delivery of such opinion of counsel, subject to
United States
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Federal income tax with respect to income received or accrued
on the Debentures, (ii) interest payable by the Sponsor on the
Debentures is not, or within 90 days of the delivery of such
opinion of counsel will not be, deductible by the Sponsor, in
whole or in part, for United States Federal income tax
purposes, or (iii) the Trust is, or will be within 90 days of
the delivery of such opinion of counsel, subject to more than
a de minimis amount of other taxes, duties or other
governmental charges.
"Like Amount" means (a) with respect to a
redemption of Securities, Securities having a Liquidation
Amount equal to that portion of the principal amount of
Debentures to be contemporaneously redeemed in accordance with
the Indenture, allocated pro rata to the Common Securities and
to the Capital Securities based upon the relative Liquidation
Amounts of such classes and (b) with respect to a distribution
of Debentures to Holders of Securities in connection with a
dissolution or liquidation of the Trust, Debentures having a
principal amount equal to the Liquidation Amount of the
Securities of the Holder to whom such Debentures are
distributed.
If an event described in clause (i) or (ii)
of the definition of Tax Event has occurred and is continuing
and the Trust is the holder of all the Debentures pursuant to
the Indenture, the Sponsor will pay any additional taxes,
duties and other governmental charges (other than United
States withholding taxes) to which the Trust has become
subject as a result of a Tax Event ("Additional Sums").
If, prior to September 24, 2003, an
Investment Company Event (as hereinafter defined) shall occur
and be continuing, the Sponsor shall cause the Regular
Trustees to liquidate the Trust and cause the Debentures to be
distributed to the Holders of the Securities in liquidation of
the Trust within 90 days following the occurrence of such
Investment Company Event in the same manner as set forth in
clause (ii) of the second paragraph of the Section 4(c).
"Investment Company Event" means the receipt
by the Trust of an opinion of counsel to the Sponsor
experienced in such matters, who shall not be an officer or
employee of the Sponsor or any of its Affiliates, to the
effect that, as a result of the occurrence of a change in law
or regulation or a written change (including any announced
prospective
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<PAGE>
change) in interpretation or application of law or regulation
by any legislative body, court, governmental agency or
regulatory authority, there is more than an insubstantial risk
that the Trust is or will be considered an "investment
company" that is required to be registered under the
Investment Company Act, which change or prospective change
becomes effective or would become effective, as the case may
be, on or after the date of the issuance of the Capital
Securities.
After the date fixed for any distribution of
Debentures: (i) the Securities will no longer be deemed to be
outstanding, (ii) the Depositary or its nominee (or any
successor Clearing Agency or its nominee), as record Holder of
Capital Securities represented by global certificates, will
receive a registered global certificate or certificates
representing the Debentures to be delivered upon such
distribution and (iii) any certificates representing
Securities, except for certificates representing Capital
Securities held by the Depositary or its nominee (or any
successor Clearing Agency or its nominee), will be deemed to
represent Debentures having an aggregate principal amount
equal to the aggregate stated Liquidation Amount of such
Securities, with accrued and unpaid interest equal to accrued
and unpaid Distributions on such Securities until such
certificates are presented to the Debenture Issuer or its
agent for transfer or reissuance.
(d) The Securities will not be redeemed unless all accrued and
unpaid Distributions have been paid on all Securities for all
quarterly Distribution periods terminating on or before the
date of redemption.
(e) "Redemption or Distribution Procedures."
(i) Notice of any redemption of, or notice of
distribution of Debentures in exchange for the
Securities (a "Redemption/Distribution Notice")
will be given by the Trust by mail to each Holder
of Securities to be redeemed or exchanged not
fewer than 30 nor more than 60 days before the
date fixed for redemption or exchange thereof
which, in the case of a redemption, will be the
date fixed for redemption of the Debentures. For
purposes of the calculation of the date of
redemption or exchange and the dates on which
notices are given pursuant to this paragraph
4(f)(i), a Redemption/Distribution Notice shall be
deemed to be given on the day such notice is first
mailed by first-class mail, postage prepaid, to
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Holders of Securities. Each Redemption/Distribution
Notice shall be addressed to the Holders of
Securities at the address of each such Holder
appearing in the books and records of the Trust.
No defect in the Redemption/Distribution Notice or
in the mailing of either thereof with respect to
any Holder shall affect the validity of the
redemption or exchange proceedings with respect to
any other Holder.
(ii) In the event that fewer than all the outstanding
Securities are to be redeemed, the Securities to
be redeemed shall be redeemed Pro Rata from each
Holder of Capital Securities, it being understood
that, in respect of Capital Securities registered
in the name of and held of record by the
Depositary (or any successor Clearing Agency) or
any nominee, the distribution of the proceeds of
such redemption will be made to each Clearing
Agency Participant (or Person on whose behalf such
nominee holds such securities) in accordance with
the procedures applied by such agency or nominee.
(iii) If Securities are to be redeemed and the Trust
gives a Redemption/Distribution Notice, which
notice may only be issued if the Debentures are
redeemed as set out in this paragraph 4 (which
notice will be irrevocable), then (A) with respect
to Capital Securities held in book-entry form, by
12:00 noon, New York City time, on the redemption
date, provided that the Debenture Issuer has paid
the Property Trustee a sufficient amount of cash
in connection with the related redemption or
maturity of the Debentures, the Property Trustee
will deposit irrevocably with the Depositary (or
successor Clearing Agency) funds sufficient to pay
the amount payable on redemption with respect to
such Capital Securities and will give the
Depositary irrevocable instructions and authority
to pay the amount payable on redemption to the
Holders of such Capital Securities, and (B) with
respect to Capital Securities issued in
certificated form and Common Securities, provided
that the Debenture Issuer has paid the Property
Trustee a sufficient amount of cash in connection
with the related redemption or maturity of the
Debentures, the Property Trustee will irrevocably
deposit with the Paying Agent funds sufficient to
pay the amount payable on redemption to the
Holders of such Securities upon surrender of their
certificates. If a Redemption/Distribution Notice
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shall have been given and funds deposited as
required, then on the date of such deposit, all
rights of Holders of such Securities so called for
redemption will cease, except the right of the
Holders of such Securities to receive the redemption
price, but without interest on such redemption price.
Neither the Regular Trustees nor the Trust shall be
required to register or cause to be registered the
transfer of any Securities that have been so called
for redemption. If any date fixed for redemption of
Securities is not a Business Day, then payment of the
amount payable on such date will be made on the next
succeeding day that is a Business Day (without any
interest or other payment in respect of any such
delay) except that, if such Business Day falls in the
next calendar year, such payment will be made on the
immediately preceding Business Day, in each case with
the same force and effect as if made on such date
fixed for redemption. If payment of the redemption
price in respect of any Securities is improperly
withheld or refused and not paid either by the Trust
or by the Sponsor as guarantor pursuant to the
relevant Securities Guarantee, Distributions on such
Securities will continue to accrue at the then
applicable rate, from the original redemption date to
the date of payment, in which case the actual payment
date will be considered the date fixed for redemption
for purposes of calculating the amount payable upon
redemption (other than for purposes of calculating
any premium).
(iv) Redemption/Distribution Notices shall be sent by the
Regular Trustees on behalf of the Trust to (A) in the
case of Capital Securities held in book-entry form,
the Depositary and, in the case of Securities held in
certificated form, the Holders of such certificates
and (B) in respect of the Common Securities, the
Holder thereof.
(v) Subject to the foregoing and applicable law
(including, without limitation, United States Federal
securities laws), the Sponsor or any of its
subsidiaries may at any time and from time to time
purchase outstanding Capital Securities by tender, in
the open market or by private agreement.
5. [RESERVED].
6. Voting Rights - Capital Securities.
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(a) Except as provided under paragraph 7, in the Business Trust
Act and as otherwise required by law and the Declaration, the
Holders of the Capital Securities will have no voting rights.
Subject to the requirements set forth in this paragraph, the
Holders of a Majority in Liquidation Amount of the Capital
Securities, voting separately as a class may direct the time,
method, and place of conducting any proceeding for any remedy
available to the Property Trustee, or direct the exercise of
any trust or power conferred upon the Property Trustee under
the Declaration, including the right to direct the Property
Trustee, as holder of the Debentures, to (i) exercise the
remedies available under the Indenture with respect to the
Debentures, (ii) waive any past Event of Default and its
consequences that is waivable under Section 5.13 of the
Indenture, or (iii) exercise any right to rescind or annul a
declaration that the principal of all the Debentures shall be
due and payable, provided, however, that, where a consent
under the Indenture would require the consent or act of the
Holders of greater than a majority of the Holders in principal
amount of Debentures affected thereby (a "Super Majority"),
the Property Trustee may only give such consent or take such
action at the direction of the Holders of at least the
proportion in Liquidation Amount of the Capital Securities
which the relevant Super Majority represents of the aggregate
principal amount of the Debentures outstanding. The Property
Trustee shall not revoke any action previously authorized or
approved by a vote of the Holders of the Capital Securities.
If the Property Trustee fails to enforce its rights, as holder
of the Debentures, under the Indenture, any Holder of Capital
Securities may, after a period of 30 days has elapsed from
such Holder's written request to the Property Trustee to
enforce such rights, institute a legal proceeding directly
against the Debenture Issuer, to enforce the rights of the
Property Trustee, as holder of the Debentures, under the
Indenture, without first instituting any legal proceeding
against the Property Trustee or any other Person.
Notwithstanding the foregoing, in the event the Debenture
Issuer shall fail to make any payment on the Debentures when
due, Holders of the Capital Securities shall have the right to
institute a direct action against the Debenture Issuer for
payment of such amounts. The Property Trustee shall notify all
holders of Capital Securities of any notice of default
received from the Debenture Trustee with respect to the
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Debentures. Such notice shall state that such Event of Default
also constitutes a Declaration Event of Default. Other than
with respect to directing the time, method and place of
conducting a proceeding for any remedy available to the
Property Trustee or the Debenture Trustee as set forth above,
the Property Trustee shall not take any action in accordance
with the directions of the Holders of the Capital Securities
under clause (i), (ii) or (iii) above unless the Property
Trustee has obtained an opinion of tax counsel to the effect
that, as a result of such action, the Trust will not fail to
be classified as a grantor trust or partnership for United
States Federal income tax purposes.
In the event the consent of the Property Trustee, as the
holder of the Debentures, is required under the Indenture with
respect to any amendment, modification or termination of the
Indenture, the Property Trustee shall request the direction of
the holders of the Securities with respect to such amendment,
modification or termination and shall vote with respect to
such amendment, modification or termination as directed by a
Majority in Liquidation Amount of the Securities voting
together as a single class; provided, however, that, where a
consent under the Indenture would require the consent of the
holders of more than a majority of the aggregate principal
amount of the Debentures, the Property Trustee may only give
such consent at the direction of the holders of at least the
same proportion in aggregate Liquidation Amount of the
Securities. The Property Trustee shall not take any such
action in accordance with the directions of the holders of the
Securities unless the Property Trustee has obtained an opinion
of tax counsel to the effect that for the purposes of United
States Federal income tax the will not be classified as other
than a grantor trust or a partnership.
A waiver of an Event of Default under the Indenture will
constitute a waiver of the corresponding Declaration Event of
Default.
Any required approval or direction of Holders of Capital
Securities may be given at a separate meeting of Holders of
Capital Securities convened for such purpose, at a meeting of
all of the Holders of Securities in the Trust or pursuant to
written consent. The Regular Trustees will cause a notice of
any meeting at which Holders of Capital Securities are
entitled to vote, or of any matter upon which action by
written consent of such Holders is to be taken, to be mailed
to
I-12
<PAGE>
each Holder of Capital Securities. Each such notice will
include a statement setting forth the following information:
(i) the date of such meeting or the date by which such action
is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are
entitled to vote or of such matter upon which written consent
is sought and (iii) instructions for the delivery of proxies
or consents.
No vote or consent of the Holders of the Capital Securities
will be required for the Trust to redeem and cancel Capital
Securities or to distribute the Debentures in accordance with
the Declaration and the terms of the Securities.
Notwithstanding that Holders of Capital Securities are
entitled to vote or consent under any of the circumstances
described above, any of the Capital Securities that are owned
at such time by the Sponsor or any Affiliate of the Sponsor
shall not be entitled to vote or consent and shall, for
purposes of such vote or consent, be treated as if they were
not outstanding.
7. Voting Rights - Common Securities.
(a) Except as provided under paragraphs 7(b), (c) and 8, in the
Business Trust Act and as otherwise required by law and the
Declaration, the Holders of the Common Securities will have no
voting rights.
(b) The Holders of the Common Securities are entitled, in
accordance with Article V of the Declaration, to vote to
appoint, remove or replace any Trustee.
(c) Subject to Section 2.6 of the Declaration and only
after the Event of Default with respect to the Capital
Securities has been cured, waived, or otherwise
eliminated and subject to the requirements of the
second to last sentence of this paragraph, the Holders
of a Majority in Liquidation Amount of the Common
Securities, voting separately as a class, may direct
the time, method, and place of conducting any
proceeding for any remedy available to the Property
Trustee, or exercising any trust or power conferred
upon the Property Trustee under the Declaration,
including (i) directing the time, method, place of
conducting any proceeding for any remedy waivable to
the Debenture Trustee, or exercising any trust or power
conferred on the Debenture Trustee with respect to the
Debentures, (ii) waive any past default and its
consequences that is waivable under Section 5.13 of the
Indenture, or (iii) exercise any right to rescind or
I-13
<PAGE>
annul a declaration that the principal of all the Debentures
shall be due and payable, provided that, where a consent or
action under the Indenture would require the consent or act of
the Holders of greater than a majority in principal amount of
Debentures affected thereby (a "Super Majority"), the Property
Trustee may only give such consent or take such action at the
direction of the Holders of at least the proportion in
Liquidation Amount of the Common Securities which the relevant
Super Majority represents of the aggregate principal amount of
the Debentures outstanding. Pursuant to this paragraph 7(c),
the Property Trustee shall not revoke any action previously
authorized or approved by a vote of the Holders of the Common
Securities. Other than with respect to directing the time,
method and place of conducting any remedy available to the
Property Trustee or the Debenture Trustee as set forth above,
the Property Trustee shall not take any action in accordance
with the directions of the Holders of the Common Securities
under this paragraph unless the Property Trustee has obtained
an opinion of tax counsel to the effect that, as a result of
such action the Trust will not fail to be classified as a
grantor trust or a partnership for United States Federal
income tax purposes. If the Property Trustee fails to enforce
its rights, as holder of the Debentures, under the Indenture,
any Holder of Common Securities may, after a period of 30 days
has elapsed from such Holder's written request to the Property
Trustee to enforce such rights, institute a legal proceeding
directly against the Debenture Issuer, to enforce the Property
Trustee's rights, as holder of the Debentures, under the
Indenture, without first instituting any legal proceeding
against the Property Trustee or any other Person.
Notwithstanding the foregoing, in the event the Debenture
Issuer shall fail to make any payment on the Debentures when
due, Holders of the Common Securities shall have the right to
institute a direct action against the Debenture Issuer for
payment of such amounts. Any required approval or direction of
Holders of Common Securities may be given at a separate
meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Securities in
the Trust or pursuant to written consent. The Regular Trustees
will cause a notice of any meeting at which Holders of Common
Securities are entitled to vote, or of any matter upon which
action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Common Securities. Each
such notice will include a statement setting forth the
I-14
<PAGE>
following information: (i) the date of such meeting or the
date by which such action is to be taken, (ii) a description
of any resolution proposed for adoption at such meeting on
which such Holders are entitled to vote or of such matter upon
which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities
will be required for the Trust to redeem and cancel Common
Securities or to distribute the Debentures in accordance with
the Declaration and the terms of the Securities.
8. Amendments to Declaration and Indenture.
(a) In addition to any requirements under Section 12.1 of
the Declaration, if any proposed amendment to the
Declaration provides for, or the Regular Trustees
otherwise propose to effect, (i) any action that would
adversely affect the powers, preferences or special
rights of the Securities, whether by way of amendment
to the Declaration or otherwise, or (ii) the
dissolution, winding-up or termination of the Trust,
other than as described in Section 8.1 of the
Declaration, then the Holders of outstanding Securities
as a class, will be entitled to vote on such amendment
or proposal (but not on any other amendment or
proposal) and such amendment or proposal shall not be
effective except with the approval of the Holders of at
least 66-2/3% in Liquidation Amount of the Securities,
voting together as a single class; provided, however,
if any amendment or proposal referred to in clause (i)
above would adversely affect only the Capital
Securities or only the Common Securities, then only the
affected class will be entitled to vote on such
amendment or proposal and such amendment or proposal
shall not be effective except with the approval of 66-
2/3% in Liquidation Amount of such class of Securities.
(b) In the event the consent of the Property Trustee as the
holder of the Debentures is required under the
Indenture with respect to any amendment, modification
or termination on the Indenture or the Debentures, the
Property Trustee shall request the direction of the
Holders of the Securities with respect to such
amendment, modification or termination and shall vote
with respect to such amendment, modification or
termination as directed by a Majority in Liquidation
Amount of the Securities voting together as a single
class; provided, however, that where a consent under
the Indenture would require the consent of the holders
I-15
<PAGE>
of greater than a majority in aggregate principal amount of
the Debentures (a "Super Majority"), the Property Trustee may
only give such consent at the direction of the Holders of at
least the same proportion in aggregate stated Liquidation
Amount of the Securities; provided, further, that the Property
Trustee shall not take any action in accordance with the
directions of the Holders of the Securities under this
paragraph 8(b) unless the Property Trustee has obtained an
opinion of tax counsel to the effect that for the purposes of
United States Federal income tax the Trust will not be
classified as other than a grantor trust or partnership on
account of such action.
9. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
of Securities according to the aggregate Liquidation Amount of the Securities
held by the relevant Holder in relation to the aggregate Liquidation Amount of
all Securities outstanding unless, on any distribution date or redemption date
an Event of Default under the Declaration has occurred and is continuing, in
which case no payment of any distribution on, or amount payable upon redemption
of, any Common Security, and no other payment on account of the redemption,
liquidation or other acquisition of Common Securities, shall be made unless
payment in full in cash of all accumulated and unpaid distributions on all
outstanding Capital Securities for all distribution periods terminating on or
prior thereto, or in the case of payment of the amount payable upon redemption
of the Capital Securities, the full amount of such amount in respect of all
outstanding Capital Securities shall have been made or provided for, and all
funds available to the Property Trustee shall first be applied to the payment in
full in cash of all distributions on, or the amount payable upon redemption of
Capital Securities then due and payable.
10. Ranking.
The Capital Securities rank pari passu and payment thereon
shall be made Pro Rata with the Common Securities except that, where an Event of
Default occurs and is continuing under the Indenture in respect of the
Debentures held by the Property Trustee, the rights of Holders of the Common
Securities to payment in respect of Distributions and payments upon liquidation,
redemption and otherwise are subordinated to the rights to payment of the
Holders of the Capital Securities.
I-16
<PAGE>
11. Acceptance of Securities Guarantee and Indenture.
Each Holder of Capital Securities and Common Securities, by
the acceptance thereof, agrees to the provisions of the Capital Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein and to the provisions of the Indenture.
12. No Preemptive Rights.
The Holders of the Securities shall have no preemptive rights
to subscribe for any additional securities.
13. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the
Capital Securities Guarantee or the Common Securities Guarantee (as may be
appropriate), and the Indenture to a Holder without charge on written request to
the Sponsor at its principal place of business.
I-17
<PAGE>
EXHIBIT A-1
FORM OF CAPITAL SECURITY
[FORM OF FACE OF SECURITY]
[Include if Capital Security is in global form and the
Depository Trust Company is the U. S. Depositary -- UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW
YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
[Include if Capital Security is in global form -- TRANSFERS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND
TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE
IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE DECLARATION REFERRED TO
BELOW.]
<TABLE>
<CAPTION>
Certificate Number Number of Capital Securities
<S> <C>
CUSIP NO. 460140205
</TABLE>
Capital Securities
of
International Paper Capital Trust III
7 7/8% Capital Securities
(Liquidation Amount $25 per Capital Security)
International Paper Capital Trust III, a statutory business
trust formed under the laws of the State of Delaware (the "Trust"), hereby
certifies that
A1-1
<PAGE>
(the "Holder") is the registered owner of Capital securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the 7 7/8% Capital Securities (Liquidation Amount $25 per Capital
Security) (the "Capital Securities"). The Capital Securities are transferable on
the books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for
transfer. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Capital Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust dated as of September __, 1998, as
the same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Capital Securities as set forth in Annex I to
the Declaration. Capitalized terms used herein but not defined shall have the
meaning given them in the Declaration. The Holder is entitled to the benefits of
the Capital Securities Guarantee to the extent provided therein. The Sponsor
will provide a copy of the Declaration, the Capital Securities Guarantee and the
Indenture to a Holder without charge upon written request to the Trust at its
principal place of business.
Reference is hereby made to select provisions of the Capital
Securities set forth on the reverse hereof, which select provisions shall for
all purposes have the same effect as if set forth at this place.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
Federal income tax purposes, the Debentures as indebtedness and the Capital
Securities as evidence of indirect beneficial ownership in the Debentures.
A1-2
<PAGE>
Unless the Property Trustee's Certificate of Authentication
hereon has been properly executed, these Capital Securities shall not be
entitled to any benefit under the Declaration or be valid or obligatory for any
purpose.
IN WITNESS WHEREOF, the Trust has executed this certificate
this [ ] day of [ ] [ ], 1998.
International Paper Capital Trust III
By:
-----------------------------------------
Name: Robert C. McPhillips
Title: Regular Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Capital Securities referred to in the
within-mentioned Declaration.
Dated: [ ] [ ], [ ]
THE BANK OF NEW YORK
as Property Trustee
By:
-----------------------
Authorized Signatory
A1-3
<PAGE>
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Capital Security will be fixed
at a rate per annum of 7 7/8% (the "Coupon Rate") of the stated Liquidation
Amount of $25 per Capital Security, such rate being the rate of interest payable
on the Debentures to be held by the Property Trustee. Distributions in arrears
for more than one quarterly period will bear interest thereon compounded
quarterly at the Coupon Rate (to the extent permitted by applicable law). The
term "Distributions" as used herein includes such cash distributions and any
such interest payable unless otherwise stated. A Distribution is payable only to
the extent that payments are made in respect of the Debentures held by the
Property Trustee and to the extent the Property Trustee has funds available
therefor. The amount of Distributions payable for any period less than a full
Distribution period will be computed on the basis of a 360-day year of twelve
30-day months and the actual days elapsed in a partial month in such period.
Distributions payable for each full Distribution period will be computed by
dividing the Coupon Rate by four.
Except as otherwise described below, distributions on the
Capital Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on March 1, June 1, September
1, and December 1 of each year, commencing on December 1, 1998, to Holders of
record on the close of business on the 15th calendar day (whether or not a
Business Day) prior to such payment dates, which payment dates shall correspond
to the interest payment dates on the Debentures. The Debenture Issuer has the
right under the Indenture to defer payments of interest by extending the
interest payment period from time to time on the Debentures for a period not
exceeding 20 consecutive quarterly periods (each an "Extension Period") and, as
a consequence of such deferral, quarterly Distributions on the Securities will
also be deferred. Despite such deferral, quarterly Distributions will continue
to accrue with interest thereon (to the extent permitted by applicable law) at
the Coupon Rate compounded quarterly during any such Extension Period from the
most recent date on which Distributions were paid, computed on the basis of a
360-day year of twelve 30-day months and the actual days elapsed in a partial
month in such period. Additional Distributions payable for each full
Distribution period will be computed by dividing the rate Coupon Rate by four.
The term "Distributions" shall include any such additional Distributions. Prior
to the termination of any such Extension Period, the Debenture Issuer may
further extend such Extension Period; provided that such Extension Period
together with all such previous and further extensions thereof may not exceed 20
consecutive quarterly periods; and provided, further, that no Extension Period
may extend beyond the stated maturity of the Debentures (as such stated maturity
may be shortened in accordance with the terms of the Indenture) or end on day
other
A1-4
<PAGE>
than an Interest Payment Date (as defined in the Indenture) for the Debentures.
Payments of accrued Distributions will be payable to Holders as they appear on
the books and records of the Trust on the first record date after the end of the
Extension Period. Upon the termination of any Extension Period and the payment
of all amounts then due, the Debenture Issuer may commence a new Extension
Period, subject to the above requirements.
The Capital Securities shall be redeemable as provided in the
Declaration.
A1-5
<PAGE>
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital Security
Certificate to:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
agent to transfer this Capital Security Certificate on the books
of the Trust. The agent may substitute another to act for him or
her.
Date:
-----------------------
Signature:
------------------
(Sign exactly as your name appears on the other side of this Capital Security
Certificate)
Signature Guarantee:*
-----------------------------------------------------------
- --------------
* (Signature must be guaranteed by an "eligible guarantor institution"
that is, a bank, stockbroker, savings and loan association or credit
union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer Agents
Medallion Program ("STAMP") or such other "signature guarantee program"
as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange
Act of 1934, as amended.)
A1-6
<PAGE>
EXHIBIT A-2
FORM OF COMMON SECURITY
[FORM OF FACE OF SECURITY]
[THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION OR AN EFFECTIVE
REGISTRATION STATEMENT.]
[OTHER THAN AS PROVIDED IN THE DECLARATION (AS DEFINED HEREIN), THIS
SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT TO A
RELATED PARTY (AS DEFINED IN THE DECLARATION) OF INTERNATIONAL PAPER COMPANY.]
Certificate Number Number of Common Securities
Common Securities
of
International Paper Capital Trust III
____7 7/8% Common Securities
(Liquidation Amount $25 per Common Security)
International Paper Capital Trust III, a statutory business
trust formed under the laws of the State of Delaware (the "Trust"), hereby
certifies that
- --------------------------------------------------------------------------------
(the "Holder") is the registered owner of common securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the 7 7/8% Common Securities (Liquidation Amount $25 per Common
Security) (the "Common Securities"). The Common Securities are transferable on
the books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for
transfer. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Common Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust dated as of September 24, 1998, as
the same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Common Securities as set forth in Annex I to the
Declaration. Capitalized terms
A2-1
<PAGE>
used herein but not defined shall have the meaning given them in the
Declaration. The Holder is entitled to the benefits of the Common Securities
Guarantee to the extent provided therein. The Sponsor will provide a copy of the
Declaration, the Common Securities Guarantee and the Indenture to a Holder
without charge upon written request to the Sponsor at its principal place of
business.
Reference is hereby made to select provisions of the Common
Securities set forth on the reverse hereof, which select provisions shall for
all purposes have the same effect as if set forth at this place.
Upon receipt of this certificate, the Sponsor is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat for United States
Federal income tax purposes the Debentures as indebtedness and the Common
Securities as evidence of indirect beneficial ownership in the Debentures.
A2-2
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate
this [ ] day of [ ] [ ], [ ].
International Paper Capital Trust III
By:
-----------------------------------
Name: Robert C. McPhillips
Title: Regular Trustee
A2-3
<PAGE>
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed at
a rate per annum of 7 7/8% (the "Coupon Rate") of the stated Liquidation Amount
of $25 per Common Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for more
than one quarterly period will bear interest thereon compounded quarterly at the
Coupon Rate (to the extent permitted by applicable law). The term
"Distributions" as used herein includes such cash distributions and any such
interest payable unless otherwise stated. A Distribution is payable only to the
extent that payments are made in respect of the Debentures held by the Property
Trustee and to the extent the Property Trustee has funds available therefor. The
amount of Distributions payable for any period less than a full Distribution
period will be computed on the basis of a 360-day year of twelve 30-day months
and the actual days elapsed in a partial month in such period. Distributions
payable for each full Distribution period will be computed by dividing the
Coupon Rate by four.
Except as otherwise described below, distributions on the
Common Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on March 1, June 1, September
1, and December 1 of each year, commencing on December 1, 1998, to Holders of
record on the close of business on the 15th calendar day (whether or not a
Business Day) prior to such payment dates, which payment dates shall correspond
to the interest payment dates on the Debentures. The Debenture Issuer has the
right under the Indenture to defer payments of interest by extending the
interest payment period from time to time on the Debentures for a period not
exceeding 20 consecutive quarterly periods (each an "Extension Period") and, as
a consequence of such deferral, quarterly Distributions on the Securities will
also be deferred. Despite such deferral, quarterly Distributions will continue
to accrue with interest thereon (to the extent permitted by applicable law) at
the Coupon Rate compounded quarterly during any such Extension Period from the
most recent date on which Distributions were paid, computed on the basis of a
360-day year of twelve 30-da months and the actual days elapsed in a partial
month in such period. Additional Distributions payable for each full
Distribution period will be computed by dividing the rate Coupon Rate by four.
The term "Distributions" shall include any such additional Distributions. Prior
to the termination of any such Extension Period, the Debenture Issuer may
further extend such Extension Period; provided that such Extension Period
together with all such previous and further extensions thereof may not exceed 20
consecutive quarterly periods; and provided, further, that no Extension Period
may extend beyond the stated maturity of the Debentures (as such stated maturity
may be shortened in accordance with the terms of the Indenture) or end on a day
other
A2-4
<PAGE>
than an Interest Payment Date (as defined in the Indenture) for the Debentures.
Payments of accrued Distributions will be payable to Holders as they appear on
the books and records of the Trust on the first record date after the end of the
Extension Period. Upon the termination of any Extension Period and the payment
of all amounts then due, the Debenture Issuer may commence a new Extension
Period, subject to the above requirements.
The Common Securities shall be redeemable as provided in the
Declaration.
A2-5
<PAGE>
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common Security
Certificate to:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
----------------------------------------
______________________________________________ agent to transfer this Common
Security Certificate on the books of the Trust. The agent may substitute another
to act for him or her.
Date:
-----------------------
Signature:
------------------
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
Signature Guarantee**:
---------------------------------------------------------
- --------------
** (Signature must be guaranteed by an "eligible guarantor institution"
that is, a bank, stockbroker, savings and loan association or credit
union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer Agents
Medallion Program ("STAMP") or such other "signature guarantee program"
as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange
Act of 1934, as amended.)
A2-6
<PAGE>
Exhibit 4.12
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
CAPITAL SECURITIES GUARANTEE AGREEMENT
INTERNATIONAL PAPER COMPANY
Dated as of September 24, 1998
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
CAPITAL SECURITIES GUARANTEE AGREEMENT
This CAPITAL SECURITIES GUARANTEE AGREEMENT ("Capital
Securities Guarantee"), dated as of September 24, 1998, is executed and
delivered by International Paper Company, a New York corporation (the
"Guarantor"), and The Bank of New York, a New York banking corporation, as
trustee (the "Guarantee Trustee"), for the benefit of the Holders (as defined
herein) from time to time of the Capital Securities (as defined herein) of
International Paper Capital Trust III, a Delaware statutory business trust (the
"Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of
Trust (the "Declaration"), dated as of September 24, 1998, among the trustees of
the Issuer named therein, the Guarantor, as Sponsor, and the holders from time
to time of undivided beneficial interests in the assets of the Issuer, the
Issuer is issuing on 28,000,000 Capital Securities (32,200,000 Capital Securi
ties if the underwriters over-allotment option is exer cised in full), having an
aggregate Liquidation Amount of $25 per Capital Security, designated the "77/8%
Capital Securities" (the "Capital Securities");
WHEREAS, as an incentive for the Holders to purchase the
Capital Securities, the Guarantor desires irrevocably and unconditionally to
agree, to the extent set forth in this Capital Securities Guarantee, to pay to
the Holders of the Capital Securities the Guarantee Payments (as defined herein)
and to make certain other payments on the terms and conditions set forth herein;
and
WHEREAS, the Guarantor is also executing and delivering a
guarantee agreement (the "Common Securities Guarantee") in substantially
identical terms to this Capital Securities Guarantee for the benefit of the
holders of the Common Securities (as defined herein) except that if an Event of
Default (as defined in the Indenture (as defined herein)), has occurred and is
continuing, the rights of holders of the Common Securi ties to receive Guarantee
Payments under the Common Securities Guarantee are subordinated to the rights of
Holders of Capital Securities to receive Guarantee Pay ments under this Capital
Securities Guarantee.
2
<PAGE>
NOW, THEREFORE, in consideration of the pur chase by each
Holder of Capital Securities, which pur chase the Guarantor hereby agrees shall
benefit the Guarantor, the Guarantor executes and delivers this Capital
Securities Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Capital Securities Guarantee, unless the context
otherwise requires:
(a) Capitalized terms used in this Capital Securities
Guarantee but not defined in the preamble above have
the respective meanings assigned to them in this
Section 1.1;
(b) a term defined anywhere in this Capital Securities
Guarantee has the same meaning throughout;
(c) all references to "the Capital Securities Guarantee"
or "this Guarantee" are to this Capital Securities
Guarantee as modified, supplemented or amended from
time to time;
(d) all references in this Capital Securities Guarantee
to Articles and Sections are to Articles and Sections
of this Capital Securities Guarantee unless otherwise
specified;
(e) a term defined in the Trust Indenture Act has the
same meaning when used in this Capital Securities
Guarantee unless other wise defined in this Capital
Securities Guarantee or unless the context otherwise
requires; and
(f) a reference to the singular includes the plural and
vice versa.
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"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act of 1933, as amended, or any successor rule thereunder.
"Capital Securities" has the meaning set forth
in the recitals of this Capital Securities Guarantee.
"Common Securities" means the common securities representing
common undivided beneficial interests in the assets of the Issuer.
"Covered Person" means any Holder or beneficial
owner of Capital Securities.
"Debentures" means the series of junior subor dinated debt
securities of the Guarantor designated the 77/8% Junior Subordinated Deferrable
Interest Debentures Due 2038 held by the Property Trustee of the Issuer.
"Distributions" means cumulative cash distribu tions
accumulating from and including September 24, 1998 and payable quarterly in
arrears on March 1, June 1, September 1, and December 1 of each year, commencing
December 1, 1998, at the annual rate of 77/8% of the Liquidation Amount.
"Event of Default" means a default by the
Guarantor on any of its payment or other obligations
under this Capital Securities Guarantee.
"Guarantee Payments" means the following pay ments or
distributions, without duplication, with respect to the Capital Securities, to
the extent not paid or made by the Issuer: (i) any accumulated and unpaid
Distribu tions required to be paid on the Capital Securities, to the extent that
the Issuer Trust has funds on hand avail able therefor at such time, (ii) the
Redemption Price with respect to any Capital Securities called for redemp tion,
to the extent that the Issuer Trust has funds on hand available therefor at such
time, and (iii) upon a voluntary or involuntary dissolution, winding-up or
liquidation of the Issuer Trust (unless the Debentures are distributed to
holders of the Capital Securities), the "Liquidation Distribution" which shall
equal the lesser of (a) the aggregate of the Liquidation Amount of all
outstanding Capital Securities and all accumulated and unpaid Distributions to
the date of payment, and (b)
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the amount of assets of the Issuer Trust remaining avail able for distribution
to the holders of the Capital Securities on liquidation of the Issuer Trust, as
pro vided in the Declaration.
"Guarantee Trustee" means The Bank of New York until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
pursuant to the terms of this Capital Securities Guarantee and thereafter means
each such Successor Guarantee Trustee.
"Holder" shall mean any holder, as registered on the books and
records of the Issuer of any Capital Securities; provided, however, that, in
determining whether the holders of the requisite percentage of Capi tal
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guaran tor or any Affiliate of the Guarantor.
"Indemnified Person" means the Guarantee Trustee, any
Affiliate of the Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives or agents of the Guarantee
Trustee.
"Indenture" means the Indenture, dated as of September 15,
1998, as supplemented by the First Supple mental Indenture, dated as of
September 24, 1998, among the Guarantor (the "Debenture Issuer") and The Bank of
New York, as trustee, and any indenture supplemental thereto pursuant to which
the Debentures are to be issued to the Property Trustee of the Issuer.
"Liquidation Amount" means the stated amount of
$25 per Capital Security.
"Majority in Liquidation of Capital Securities" means, except
as provided by the Trust Indenture Act, Holder(s) of Capital Securities, voting
separately as a class, representing more than 50% of the stated Liquida tion
Amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus ac crued and unpaid Distributions to the date
upon which the voting percentages are determined) of all Capital Securi ties.
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"Officers' Certificate" means, with respect to any Person, a
certificate signed by two duly authorized officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Capital Securities Guaran tee shall include:
(a) a statement that each officer signing the certificate has
read the covenant or condition and the definition relating thereto;
(b) a brief statement of the nature and scope
of the examination or investigation undertaken by each
officer in rendering the certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such offi cer's opinion, is necessary to
enable such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited lia bility company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Redemption Price" shall have the meaning
specified in the Declaration.
"Responsible Officer" means, with respect to the Guarantee
Trustee, the chairman of the board of directors, the president, any
vice-president, any assis tant vice-president, the secretary, any assistant
secre tary, the treasurer, any assistant treasurer, any trust officer or
assistant trust officer or any other officer of the Guarantee Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of that
officer's knowledge of and familiarity with the particular subject.
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"Successor Guarantee Trustee" means a successor Guarantee
Trustee possessing the qualifications to act as Guarantee Trustee under Section
4.1.
"Trust Indenture Act" means the Trust Indenture
Act of 1939, as amended.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Capital Securities Guarantee is subject to the
provisions of the Trust Indenture Act that are required to be part of this
Capital Securities Guar antee, which are incorporated by reference hereto, and
shall, to the extent applicable, be governed by such provisions; and
(b) if and to the extent that any provision of this Capital
Securities Guarantee limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.
SECTION 2.2 Lists of Holders of Securities.
(a) The Guarantor shall provide the Guarantee Trustee (i) within 14
days after January 1 and June 30 of each year, a list, in such form as the
Guarantee Trustee may reasonably require, of the names and addresses of the
Holders of the Capital Securities ("List of Holders") as of such date, provided
that the Guarantor shall not be obligated to provide such List of Holders at any
time the List of Holders does not differ from the most recent List of Holders
given to the Guarantee Trustee by the Guaran tor, and (ii) at any other time,
within 30 days of re ceipt by the Guarantor of a written request for a List of
Holders as of a date no more than 14 days before such List of Holders is given
to the Guarantee Trustee. The Guarantee Trustee may destroy any List of Holders
previ ously given to it on receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
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SECTION 2.3 Reports by the Guarantee Trustee.
Within 60 days after May 15 of each year, the Guarantee
Trustee shall provide to the Holders of the Capital Securities such reports, if
any, as are required by Section 313 of the Trust Indenture Act in the form and
in the manner provided by Section 313 of the Trust Inden ture Act. The Guarantee
Trustee shall also comply with the requirements of Section 313(d) of the Trust
Indenture Act.
SECTION 2.4 Periodic Reports to Guarantee Trustee.
The Guarantor shall provide to the Guarantee Trustee such
documents, reports and information (if any) as required by Section 314 of the
Trust Indenture Act and the compliance certificate required by Section 314 of
the Trust Indenture Act in the form, in the manner and at the times required by
Section 314 of the Trust Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions
Precedent.
The Guarantor shall provide to the Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Capital Securi ties Guarantee which relate to any of the matters set forth
in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given in
the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver.
The Holders of a Majority in Liquidation Amount of Capital
Securities may, by vote, on behalf of the Holders of all of the Capital
Securities, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured, for every purpose of this
Capital Secu rities Guarantee, but no such waiver shall extend to any subsequent
or other default or Event of Default or impair any right consequent thereon.
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SECTION 2.7 Event of Default; Notice.
(a) The Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, trans mit by mail, first class postage
prepaid, to the Holders of the Capital Securities, notices of all Events of
Default known to the Guarantee Trustee, unless such defaults have been cured
before the giving of such no tice, provided, that, the Guarantee Trustee shall
be protected in withholding such notice if and so long as the board of
directors, the executive committee, or a trust committee of directors and/or
Responsible Officers of the Guarantee Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders of the Capital
Securities.
(b) The Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default except any Event of Default as to which the
Guarantee Trustee shall have received written notice or a Responsible Officer
charged with the administration of the Declaration shall have obtained written
notice.
SECTION 2.8 Conflicting Interests.
The Declaration shall be deemed to be specifi cally described
in this Capital Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Guarantee
Trustee.
(a) This Capital Securities Guarantee shall be held by the
Guarantee Trustee for the benefit of the Holders of the Capital Securities, and
the Guarantee Trustee shall not transfer this Guarantee Agreement to any Person
except a Holder of Capital Securities exercis ing his or her rights pursuant to
Section 5.4(b) or to a Successor Guarantee Trustee on acceptance by such Succes
sor Guarantee Trustee of its appointment to act as Suc cessor Guarantee Trustee.
The right, title and interest of the Guarantee Trustee shall automatically vest
in any
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Successor Guarantee Trustee, and such vesting and cessa tion of title shall be
effective whether or not conveyancing documents have been executed and delivered
pursuant to the appointment of such Successor Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Capital Securities Guarantee for the
benefit of the Holders of the Capital Securities.
(c) The Guarantee Trustee, before the occur rence of any Event
of Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Capital Securities Guarantee, and no implied covenants shall be read into
this Capital Securities Guarantee against the Guarantee Trustee. In case an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.6), the Guarantee Trustee shall exercise such of the rights and powers
vested in it by this Capital Securities Guarantee, and use the same degree of
care and skill in its exercise thereof, as a prudent person would exercise or
use under the circum stances in the conduct of his or her own affairs.
(d) No provision of this Capital Securities Guarantee shall be
construed to relieve the Guarantee Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful miscon duct, except
that:
(i) prior to the occurrence of any Event of Default
and after the curing or waiv ing of all such Events of Default that may
have occurred:
(A) the duties and obligations
of the Guarantee Trustee shall be determined solely by the express
provisions of this Capi tal Securities Guarantee, and the Guarantee
Trustee shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this Capital
Securities Guarantee, and no implied covenants or obligations shall be
read into this Capital
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Securities Guarantee against the Guarantee
Trustee; and
(B) in the absence of bad faith
on the part of the Guarantee Trustee, the Guar antee Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any cer tificates
or opinions furnished to the Guaran tee Trustee and conforming to the
requirements of this Capital Securities Guarantee; but in the case of
any such certificates or opinions that by any provision hereof are
specifically required to be furnished to the Guarantee Trustee, the
Guarantee Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Capital Securities Guarantee;
(ii) the Guarantee Trustee shall not be liable for
any error of judgment made in good faith by a Responsible Officer of
the Guarantee Trustee, unless it shall be proved that the Guarantee
Trustee was negligent in ascertaining the pertinent facts upon which
such judgment was made;
(iii) the Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith
in accordance with the direction of the Holders of not less than a
Majority in Liquidation Amount of the Capital Securities at the time
outstand ing, relating to the time, method and place of conducting any
proceeding for any remedy avail able to the Guarantee Trustee, or
exercising any trust or power conferred upon the Guarantee Trustee
under this Capital Securities Guaran tee; and
(iv) no provision of this Capital Securities
Guarantee shall require the Guaran tee Trustee to expend or risk its
own funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of its
rights or powers, if the Guarantee Trustee shall have reasonable
grounds
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for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Capital Securities
Guarantee or adequate indemnity against such risk or liability is not
reasonably assured to it.
SECTION 3.2 Certain Rights of Guarantee Trustee.
(a) Subject to the provisions of Section 3.1:
(i) The Guarantee Trustee may rely and shall be
fully protected in acting or re fraining from acting upon any
resolution, cer tificate, statement, instrument, opinion, re port,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document be lieved by
it to be genuine and to have been signed, sent or presented by the
proper party or parties;
(ii) any direction or act of the Capital Securities
Guarantor contemplated by this Capital Securities Guarantee shall be
sufficiently evidenced by an Officers' Certifi cate;
(iii) whenever, in the administration of this Capital
Securities Guarantee, the Guar antee Trustee shall deem it desirable
that a matter be proved or established before taking, suffering or
omitting any action hereunder, the Guarantee Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of bad
faith on its part, request and rely upon an Officers' Certificate
which, upon receipt of such request, shall be promptly delivered by the
Guarantor;
(iv) the Guarantee Trustee shall have no duty to see
to any recording, filing or registration of any instrument (or any
rerecording, refiling or registration thereof);
(v) the Guarantee Trustee may con
sult with counsel, and the written advice or
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opinion of such counsel with respect to legal matters shall be full and
complete authoriza tion and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance
with such advice or opinion. Such counsel may be counsel to the
Guarantor or any of its Affiliates and may include any of the
Guarantor's employees. The Guarantee Trustee shall have the right at
any time to seek instructions concerning the admin istration of this
Guarantee Agreement from any court of competent jurisdiction.
(vi) the Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
Capital Securities Guarantee at the request or direc tion of any
Holder, unless such Holder shall have provided to the Guarantee Trustee
such adequate security and indemnity as would sat isfy a reasonable
person in the position of the Guarantee Trustee, against the costs,
expenses (including attorneys' fees and expenses) and liabilities that
might be incurred by it in complying with such request or direction, in
cluding such reasonable advances as may be requested by the Guarantee
Trustee; provided that nothing contained in this Section 3.2(a)(vi)
shall be taken to relieve the Guar antee Trustee, upon the occurrence
of an Event of Default, of its obligation to exercise the rights and
powers vested in it by this Capital Securities Guarantee;
(vii) the Guarantee Trustee shall not be bound to
make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document, but the
Guarantee Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit;
(viii) the Guarantee Trustee may exe cute any of the
trusts or powers hereunder or
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perform any duties hereunder either directly or by or through agents or
attorneys, and the Guarantee 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;
(ix) any action taken by the Guaran tee Trustee or
its agents hereunder shall bind the Holders of the Capital Securities,
and the signature of the Guarantee Trustee or its agents alone shall be
sufficient and effective to perform any such action. No third party
shall be required to inquire as to the author ity of the Guarantee
Trustee to so act or as to its compliance with any of the terms and
provi sions of this Capital Securities Guarantee, both of which shall
be conclusively evidenced by the Guarantee Trustee's or its agent's tak
ing such action; and
(x) whenever in the administration of this Capital
Securities Guarantee the Guar antee Trustee shall deem it desirable to
re ceive instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Guarantee Trustee (i) may re
quest instructions from the Holders of the Capital Securities or the
Guarantor, (ii) may refrain from enforcing such remedy or right or
taking such other action until such instruc tions are received, and
(iii) shall be pro tected in acting in accordance with such in
structions.
(b) No provision of this Capital Securities Guarantee shall be
deemed to impose any duty or obliga tion on the Guarantee Trustee to perform any
act or acts or exercise any right, power, duty or obligation con ferred or
imposed on it, in any jurisdiction in which it shall be illegal, or in which the
Guarantee Trustee shall be unqualified or incompetent in accordance with applica
ble law, to perform any such act or acts or to exercise any such right, power,
duty or obligation. No permissive power or authority available to the Guarantee
Trustee shall be construed to be a duty.
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SECTION 3.3. Not Responsible for Recitals or Issuance
of Guarantee.
The recitals contained in this Capital Securi ties Guarantee
shall be taken as the statements of the Guarantor, and the Guarantee Trustee
does not assume any responsibility for their correctness. The Guarantee Trustee
makes no representations as to the validity or sufficiency of this Capital
Securities Guarantee.
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.1 Guarantee Trustee; Eligibility.
(a) There shall at all times be a Guarantee
Trustee which shall:
(i) not be an Affiliate of the Guar
antor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia, or a corporation or
Person permitted by the Securi ties and Exchange Commission to act as
an in stitutional trustee under the Trust Indenture Act, authorized
under such laws to exercise corporate trust powers, having a combined
capi tal and surplus of at least 50 million U.S. dollars ($50,000,000),
and subject to supervi sion or examination by Federal, State, Territo
rial or District of Columbia authority. If such corporation publishes
reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority referred to
above, then, for the purposes of this Section 4.1(a)(ii), the com bined
capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published.
(b) If at any time the Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the
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Guarantee Trustee shall immediately resign in the manner and with the effect set
out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee and Guarantor shall in all respects comply with the provisions
of Section 310(b) of the Trust Indenture
Act.
SECTION 4.2 Appointment, Removal and Resignation
of Guarantee Trustee.
(a) Subject to Section 4.2(b), the Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed in accordance
with Section 4.2(a) until a Successor Guarantee Trustee has been appointed and
has accepted such appointment by written instrument executed by such Successor
Guarantee Trustee and delivered to the Guaran tor.
(c) The Guarantee Trustee appointed to office shall hold
office until a Successor Guarantee Trustee shall have been appointed or until
its removal or resig nation. The Guarantee Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in writing
executed by the Guarantee Trustee and delivered to the Guarantor, which
resignation shall not take effect until a Successor Guarantee Trustee has been
appointed and has accepted such appointment by instrument in writing executed by
such Successor Guaran tee Trustee and delivered to the Guarantor and the re
signing Guarantee Trustee.
(d) If no Successor Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within 60
days after delivery to the Guarantor of an instrument of resignation, the
resigning Guarantee Trustee may petition any court of competent jurisdiction for
appointment of a Successor Guarantee Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a Successor
Guarantee Trustee.
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ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Pay ments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guaran tee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
SECTION 5.2 Subordination
If an Event of Default (as defined in the Indenture), has
occurred and is continuing, the rights of Holders of the Common Securities to
receive Guarantee Payments under the Common Securities Guarantee are subor
dinated to the rights of Holders of Capital Securities to receive Guarantee
Payments under this Capital Securities Guarantee.
SECTION 5.3 Waiver of Notice and Demand.
The Guarantor hereby waives notice of accep tance of this
Capital Securities Guarantee and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
SECTION 5.4 Obligations Not Affected.
The obligations, covenants, agreements and duties of the
Guarantor under this Capital Securities Guarantee shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law
or otherwise, of the performance or observance by the
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Issuer of any express or implied agreement, covenant, term or condition relating
to the Capital Securities to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all
or any portion of the Distributions, the amount payable upon redemption,
Liquidation Distribu tion or any other sums payable under the terms of the
Capital Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Capital Securities
(other than an extension of time for payment of Distributions, the amount
payable upon redemption, Liquidation Distribu tion or other sum payable that
results from the extension of any interest payment period on the Debentures or
any extension of the maturity date of the Debentures permit ted by the
Indenture);
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right, privilege, power
or remedy con ferred on the Holders pursuant to the terms of the Capi tal
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insol vency, bankruptcy, assignment for
the benefit of credi tors, reorganization, arrangement, composition or read
justment of debt of, or other similar proceedings affect ing, the Issuer or any
of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency
in the Capital Securities;
(f) the settlement or compromise of any obli
gation guaranteed hereby or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it being
the intent of this Section 5.4 that the obligations of the Guarantor hereun der
shall be absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders or
any other Person to give notice to, or obtain consent of,
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the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.5 Rights of Holders.
(a) The Holders of a Majority in Liquidation Amount of the
Capital Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of this Capital Securities Guarantee or exercis ing any trust or power
conferred upon the Guarantee Trustee under this Capital Securities Guarantee.
(b) If the Guarantee Trustee fails to enforce this Capital
Securities Guarantee, any Holder of Capital Securities may, after such Holder
makes a written request to the Guarantee Trustee to enforce this Capital Securi
ties Guarantee, institute a legal proceeding directly against the Guarantor to
enforce its rights under this Capital Securities Guarantee, without first
instituting a legal proceeding against the Issuer, the Guarantee Trustee or any
other Person.
SECTION 5.6 Guarantee of Payment.
This Capital Securities Guarantee creates a guarantee of
payment and not of collection.
SECTION 5.7 Subrogation.
The Guarantor shall be subrogated to all (if any) rights of
the Holders of Capital Securities against the Issuer in respect of any amounts
paid to such Holders by the Guarantor under this Capital Securities Guarantee;
provided, however, that the Guarantor shall not (except to the extent required
by mandatory provisions of law) be entitled to enforce or exercise any right
that it may acquire by way of subrogation or any indemnity, reim bursement or
other agreement, in all cases as a result of payment under this Capital
Securities Guarantee, if, at the time of any such payment, any amounts are due
and unpaid under this Capital Securities Guarantee. If any amount shall be paid
to the Guarantor in violation of the preceding sentence, the Guarantor agrees to
hold such amount in trust for the Holders and to pay over such amount to the
Holders.
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SECTION 5.8 Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Capital
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Capital
Securities Guarantee notwithstand ing the occurrence of any event referred to in
subsec tions (a) through (g), inclusive, of Section 5.4 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions.
So long as any Capital Securities remain out standing, if
there shall have occurred an Event of De fault, an event that, with the giving
of notice or the lapse of time or both, would constitute an Event of Default
under the Indenture or a selection by the Guaran tor of an Extension Period (as
defined in the Indenture) and such period, or any extension thereof, shall be
continuing, then (a) the Guarantor shall not declare or pay any dividend on,
make any distributions with respect to, or redeem, purchase or acquire or make a
liquidation payment with respect to, any of its capital stock (other than stock
dividends paid by the Guarantor which consist of the stock of the same class as
that on which the dividend is being paid), (b) the Guarantor shall not make any
payment of interest, principal or premium, if any, on or repay, repurchase or
redeem any debt securities issued by the Guarantor which rank pari passu with or
junior to the Debentures, and (c) the Guarantor shall not make any guarantee
payments with respect to the foregoing (other than pursuant to the Capital
Securities Guarantee).
SECTION 6.2 Ranking.
This Capital Securities Guarantee will consti tute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to all Senior Indebtedness (as defined in the Indenture) of
the Guarantor, (ii) pari passu with the most senior preferred or preference
stock now or hereafter issued by the Guarantor and with any guarantee now or
hereafter entered into by the Guarantor in respect of any preferred
20
<PAGE>
or preference stock or Capital Security of any Affiliate of the Guarantor, and
(iii) senior to the Guarantor's common stock.
In the event that payment is made on the Debentures or under this
Capital Securities Guarantee in contraven tion of the provisions contained in
this Section 6.2, such payments will be paid over to the holders of Senior
Indebtedness of the Guarantor.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination.
This Capital Securities Guarantee shall termi nate (i) upon
full payment of the redemption price of all Capital Securities, (ii) upon
distribution of the Deben tures to the Holders of all of the Capital Securities
or (iii) full payment of the amounts payable in accordance with the Declaration
upon liquidation of the Issuer. Notwithstanding the foregoing, this Capital
Securities Guarantee will continue to be effective or will be rein stated, as
the case may be, if at any time any Holder of Capital Securities must restore
payment of any sums paid under the Capital Securities or under this Capital Secu
rities Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation.
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Guarantor or any Covered Person for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Indemnified Person in good faith in accordance with this Capital
Securities Guarantee and in a manner that such Indemnified Person reasonably
believed to be within the scope of the authority conferred on such Indemnified
Person by this Capital Securities Guarantee or by law, except that an
Indemnified Person shall be liable for any such loss, damage or claim incurred
by reason of such Indemnified Person's negligence or willful misconduct with
respect to such acts or omissions.
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<PAGE>
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions, re
ports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reason able
care by or on behalf of the Guarantor, including information, opinions, reports
or statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Capital Securities might properly be paid.
SECTION 8.2 Indemnification.
(a) To the fullest extent permitted by appli cable law, the
Guarantor shall indemnify and hold harm less each Indemnified Person from and
against any loss, damage or claim incurred by such Indemnified Person by reason
of any act or omission performed or omitted by such Indemnified Person in good
faith in accordance with this Capital Securities Guarantee and in a manner such
Indemnified Person reasonably believed to be within the scope of authority
conferred on such Indemnified Person in accordance with this Capital Securities
Guarantee, except that no Indemnified Person shall be entitled to be indemnified
in respect of any loss, damage or claim incurred by such Indemnified Person by
reason of negli gence or willful misconduct with respect to such acts or
omissions.
(b) To the fullest extent permitted by appli cable law,
expenses (including legal fees and expenses) incurred by an Indemnified Person
in defending any claim, demand, action, suit or proceeding shall, from time to
time, be advanced by the Guarantor prior to the final disposition of such claim,
demand, action, suit or pro ceeding upon receipt by the Guarantor of an
undertaking by or on behalf of the Indemnified Person to repay such amount if it
shall be determined that the Indemnified Person is not entitled to be
indemnified as authorized in Section 8.2(a).
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<PAGE>
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns.
All guarantees and agreements contained in this Capital
Securities Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Capital Securities then outstanding. Except in connection with any
permitted merger or consolidation of the Guarantor with or into another entity
or any permit ted sale, transfer or lease of the Guarantor's assets to another
entity, the Guarantor may not assign its rights or delegate its obligations
under the Capital Securities Guarantee without the prior approval of the Holders
of at least 66-2/3% of the aggregate stated Liquidation Amount of the Capital
Securities then outstanding.
SECTION 9.2 Amendments.
Except with respect to any changes that do not adversely
affect the rights of Holders (in which case no vote will be required), this
Capital Securities Guarantee may only be amended with the prior approval of the
Hold ers of at least 66-2/3% in Liquidation Amount of all the outstanding
Capital Securities. The provisions of Sec tion 12.2 of the Declaration with
respect to meetings of Holders of the Securities apply to the giving of such
approval.
SECTION 9.3 Notices.
All notices provided for in this Capital Secu rities Guarantee
shall be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by registered or certified mail, as follows:
(a) If given to the Guarantee Trustee, at the Guarantee Trustee's
mailing address set forth below (or such other address as the Guarantee Trustee
may give notice of to the Holders of the Capital Securities):
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The Bank of New York
101 Barclay Street
21 West
Attn: Corporate Trust
Trustee Administration
New York, New York 10286
(b) If given to the Guarantor, at the Guaran tor's mailing
address set forth below (or such other address as the Guarantor may give notice
of to the Hold ers of the Capital Securities):
International Paper Company
Two Manhattanville Road
Purchase, New York 10577
(c) If given to any Holder of Capital Securi ties, at the
address set forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 9.4 Benefit.
This Capital Securities Guarantee is solely for the benefit of
the Holders of the Capital Securities and, subject to Section 3.1(a), is not
separately transferable from the Capital Securities.
SECTION 9.5 Governing Law.
THIS CAPITAL SECURITIES GUARANTEE SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAWS.
24
<PAGE>
THIS CAPITAL SECURITIES GUARANTEE is executed as of the day
and year first above written.
INTERNATIONAL PAPER
COMPANY, as Guarantor
By:/s/ E. William Boehmler
-------------------------------
Name: E. William Boehmler
Title: Vice President and
Treasurer
THE BANK OF NEW YORK, as
Guarantee Trustee
By:/s/ Mary LaGumina
-------------------------------
Name: Mary LaGumina
Title: Assistant Vice
President
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<PAGE>
Exhibit 4.15
--------------------------------
--------------------------------
FIRST SUPPLEMENTAL INDENTURE
between
INTERNATIONAL PAPER COMPANY
and
THE BANK OF NEW YORK
Dated as of September 24, 1998
--------------------------------
--------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
ARTICLE I
DEFINITIONS
<S> <C>
SECTION 1.1. Definition of Terms..............................................2
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE DEBENTURES
SECTION 2.1. Designation and Principal Amount.................................5
SECTION 2.2. Maturity.........................................................5
SECTION 2.3. Form and Payment.................................................5
SECTION 2.4. Global Debenture.................................................6
SECTION 2.5. Interest.........................................................7
ARTICLE III
REDEMPTION OF THE DEBENTURES
SECTION 3.1. Tax Event or Investment Company Event
Redemption......................................................9
SECTION 3.2. Optional Redemption by Company...................................9
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.1. Extension of Interest Payment Period............................10
SECTION 4.2. Notice of Extension.............................................11
SECTION 4.3. Limitation of Transactions......................................12
ARTICLE V
EXPENSES
SECTION 5.1. Payment of Expenses.............................................12
SECTION 5.2. Payment Upon Resignation or Removal.............................13
ARTICLE VI
ADDITIONAL COVENANTS
SECTION 6.1. Listing on an Exchange..........................................14
SECTION 6.2. Ownership of Common Securities..................................14
SECTION 6.3. Maintenance of Trust............................................14
ARTICLE VII
VOTING RIGHTS
SECTION 7.1 Debenture Holder Voting Rights..................................14
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
Page
----
ARTICLE VII
SUBORDINATION
<S> <C>
SECTION 8.1 Subordination of Debentures.....................................16
ARTICLE IX
MODIFICATION
SECTION 9.1 Modification of Indenture and First
Supplemental Indenture.........................................16
ARTICLE X
FORM OF DEBENTURE
SECTION 10.1. Form of Debenture...............................................17
ARTICLE XI
ORIGINAL ISSUE OF DEBENTURES
SECTION 11.1. Original Issue of Debentures....................................26
ARTICLE XII
MISCELLANEOUS
SECTION 12.1. Ratification of Indenture.......................................26
SECTION 12.2. Trustee Not Responsible for Recitals............................26
SECTION 12.3. Governing Law...................................................26
SECTION 12.4. Separability....................................................26
SECTION 12.5. Counterparts....................................................27
</TABLE>
ii
<PAGE>
FIRST SUPPLEMENTAL INDENTURE, dated as of September 24, 1998 (the
"First Supplemental Indenture"), between International Paper Company, a New York
corporation (the "Company"), and The Bank of New York, as trustee (the
"Trustee") under the Indenture, dated as of September 15, 1998, between the
Company and the Trustee (the "Indenture").
WHEREAS, the Company executed and delivered the Indenture to the
Trustee to provide, among other things, for the future issuance of the Company's
unsecured subordinated debt securities to be issued from time to time in one or
more series as might be determined by the Company under the Indenture, in an
unlimited aggregate principal amount which may be authenticated and delivered as
provided in the Indenture;
WHEREAS, Section 9.1 of the Indenture provides for various matters
with respect to any series of Securities issued under the Indenture to be
established in an indenture supplemental to the Indenture;
Section 9.1(6) of the Indenture provides for the Company and the
Trustee to enter into an indenture supplemental to the Indenture to establish
the form or terms of Securities of any series as provided by Sections 2.1 and
3.1 of the Indenture; and
the Board of Directors of the Company has duly adopted resolutions
authorizing the Company to execute and deliver this First Supplemental
Indenture;
WHEREAS, pursuant to the terms of the Indenture, the Company
desires to provide for the establishment of a new series of its Securities to be
known as its 7 7/8% Junior Subordinated Deferrable Interest Debentures due 2038
(the "Debentures"), the form and substance of such Debentures and the terms,
provisions and conditions thereof to be set forth as provided in the Indenture,
and this First Supplemental Indenture;
WHEREAS, International Paper Capital Trust III, a Delaware
statutory business trust (the "Trust"), has offered to the public 28,000,000 of
its 7 7/8% Capital Securities (the "Capi tal Securities") with an aggregate
Liquidation Amount (as defined herein) of $700,000,000(or 32,200,000 Capital
Securities with an aggregate Liquidation Amount of $805,000,000 if the
Underwriters' over-allotment option with respect to such Capital Securities (the
"Option") is exercised in full), representing undivided beneficial interests in
the assets of the Trust, and proposes to invest the proceeds from such offering,
together with the proceeds of the issuance and sale by the Trust to the Company
of 865,980 of the Trust's 7 7/8% Common Securities (the "Common Securities")
with an aggregate Liquidation Amount of $21,649,500 (or 995,877 Common
Securities with an aggregate Liquidation Amount of
<PAGE>
$24,896,925 if the Option is exercised in full), representing undivided
beneficial interests in the assets of the Trust, in $721,649,500 aggregate
principal amount of the Debentures (or $829,896,925 if the Option is exercised
in full); and
WHEREAS, the Company has requested that the Trustee execute and
deliver this First Supplemental Indenture and all requirements necessary to make
this First Supplemental Indenture a valid instrument in accordance with its
terms, and to make the Debentures, when executed by the Company and
authenticated and delivered by the Trustee, the valid obligations of the
Company, have been performed, and the execution and delivery of this First
Supplemental Indenture has been duly authorized in all respects:
NOW THEREFORE, in consideration of the purchase and acceptance of
the Debentures by the Holders thereof, and for the purpose of setting forth, as
provided in the Indenture, the form and substance of the Debentures and the
terms, provisions and conditions thereof, the Company covenants and agrees with
the Trustee as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definition of Terms.
Unless the context otherwise requires:
(a) a term defined in the Indenture has the same meaning when used
in this First Supplemental Indenture unless the definition of such term is
amended and supplemented pursuant to this First Supplemental Indenture;
(b) a term defined anywhere in this First Supplemental Indenture
has the same meaning throughout;
(c) the singular includes the plural and vice versa;
(d) a reference to a Section or Article is to a Section or Article
of this First Supplemental Indenture;
(e) headings are for convenience of reference only and do not
affect interpretation;
(f) the following terms have the meanings given to them in the
Declaration or in Annex I thereto: (i) Business Day; (ii) Clearing Agency;
(iii) Delaware Trustee; (iv) Depositary; (v) Certificate; (vi) Property
Trustee; (vii) Regular Trustees; (viii) Underwriting Agreement; (ix)
Affiliate; (x) Underwriters and (xi) Capital Securities Guarantee; and
2
<PAGE>
(g) the following terms have the meanings given to them in this
Section 1.1(g):
"Additional Sums" shall have the meaning set forth in Section 2.5.
"Declaration" means the Amended and Restated Declaration of Trust
of International Paper Capital Trust III, a statutory business trust formed
under Delaware law, dated as of September 24, 1998.
"Extension Period" shall have the meaning set forth in Section
4.1.
"5 1/4% Debentures" means the 5 1/4% Junior Subordinated
Deferrable Interest Debentures due 2025 of the Company.
"Global Debenture" shall have the meaning set forth in Section
2.4.
"Investment Company Event" means the receipt by the Trust of an
opinion of counsel to the Company experienced in such matters, who shall not be
an officer or employee of the Company or any of its Affiliates, to the effect
that, as a result of the occurrence of a change in law or regulation or a
written change (including any announced prospective change) in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority, there is more than an insubstantial risk that
the Trust is or will be considered an "investment company" that is required to
be registered under the Investment Company Act of 1940, as amended (the
"Investment Company Act"), which change or prospective change becomes effective
or would become effective, as the case may be, on or after the date of the
issuance of the Capital Securities.
"Liquidation Amount" means the stated amount of $25 per Capital
Security and $25 per Common Security.
"Non Book-Entry Capital Securities" has the meaning set forth in
Section 2.4.
"Senior Indebtedness" shall mean in respect of the Company (i) the
principal, premium, if any, and interest in respect of (A) indebtedness of such
obligor for money borrowed and (B) indebtedness evidenced by securities,
debentures, bonds or other similar instruments issued by such obligor, (ii) all
capital lease obligations of such obligor, (iii) all obligations of such obligor
issued or assumed as the deferred purchase price of property, all conditional
sale obligations of such obligor and all obligations of such obligor under any
title retention agreement (but excluding trade accounts payable arising in the
ordinary course of business), (iv) all obligations of such obligor
3
<PAGE>
for the reimbursement of any letter of credit, bankers acceptance, security
purchase facility or similar credit transaction, (v) all obligations of the type
referred to in clauses (i) through (iv) above of other persons for the payment
of which such obligor is responsible or liable as obligor, guarantor or
otherwise, and (vi) all obligations of the type referred to in clauses (i)
through (v) above of other persons secured by any lien on any property or asset
of such obligor (whether or not such obligation is assumed by such obligor),
except for (1) any such indebtedness that is by its terms subordinated to or
pari passu with the Debentures (including the 5 1/4% Debentures which are pari
passu with the Debentures) and (2) any indebtedness (including all other debt
securities and Capital Securities Guarantees in respect of those debt
securities) initially issued to any other trust, or a trustee of such trust,
partnership or other entity affiliated with the Company that is, directly or
indirectly, a financing vehicle of the Company (a "Financing Entity") in
connection with the issuance by such Financing Entity of preferred securities or
other similar securities. Such Senior Indebtedness shall continue to be Senior
Indebtedness and entitled to the benefits of the subordination provisions
irrespective of any amendment, modification or waiver of any term of such Senior
Indebtedness.
"Stated Maturity" has the meaning set forth in Section 2.2.
"Tax Event" means the receipt by the Trust of an opinion of tax
counsel to the Company experienced in such matters, who shall not be an officer
or employee of the Company or any of its Affiliates, to the effect that, as a
result of any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein, or as a result of
any official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement, action or decision is announced on or after
the date of issuance of the Capital Securities, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days of the
delivery of such opinion, subject to United States Federal income tax with
respect to income received or accrued on the Debentures, (ii) interest payable
by the Company on the Debentures is not, or within 90 days of the delivery of
such opinion will not be, deductible by the Company, in whole or in part, for
United States Federal income tax purposes or (iii) the Trust is, or will be
within 90 days of the delivery of the opinion, subject to more than a de minimis
amount of other taxes, duties or other governmental charges.
4
<PAGE>
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE DEBENTURES
SECTION 2.1. Designation and Principal Amount.
There is hereby authorized a series of Securities designated the
"7 7/8% Junior Subordinated Deferrable Interest Debentures due 2038", limited in
aggregate principal amount to $721,649,500 (or $829,896,925 if the Option is
exercised in full) which amount shall be as set forth in any written order of
the Company for the authentication and delivery of Debentures pursuant to
Section 3.3 of the Indenture.
SECTION 2.2. Maturity.
(a) The Debentures will mature on December 1, 2038 (such date, as
it may be advanced as described in Section 2.2(b), the "Stated Maturity").
(b) If a Tax Event occurs, then the Company shall have the right,
upon written notice to the Trustee prior to the termination of the Trust, to
advance the Stated Maturity of the Debentures to the minimum extent required
in order to allow for the payments of interest in respect of the Debentures
to continue to be tax deductible, but in no event shall the resulting
maturity of the Debentures be less than 15 years from the date of original
issuance thereof. The Stated Maturity may be advanced only if, in the
written opinion of independent tax counsel to the Company experienced in
such matters, delivered to the Trustee, (a) after advancing the Stated
Maturity, interest paid on the Debentures will be deductible for United
States Federal income tax purposes and (b) advancing the Stated Maturity
will not result in a taxable event to holders of the Capital Securities.
If the Company elects to advance the Stated Maturity of the
Debentures, it shall give written notice to the Trustee, and the Trustee shall
give notice of such change to the Holders of the Debentures not less than 30 and
not more than 60 days prior to the effectiveness thereof.
SECTION 2.3. Form and Payment.
Except as provided in Section 2.4, the Debentures shall be issued
in fully registered certificated form without interest coupons. Principal and
interest on the Debentures issued in certificated form will be payable, the
transfer of such Debentures will be registrable and such Debentures will be
exchangeable for Debentures bearing identical terms and provisions at the
Corporate Trust Office or agency of the Trustee; provided, however, that payment
of interest may be made at the option of the Company by check mailed to the
Holder at such address as
5
<PAGE>
shall appear in the Security Register. However, a Holder of $1 million or more
in aggregate principal amount of Debentures may receive payments of interest
(other than interest payable at the Stated Maturity) by wire transfer of
immediately available funds upon written request to the Trustee not later than
15 calendar days prior to the date on which the interest is payable.
Not-withstanding the foregoing, so long as the Holder of any Debentures is the
Property Trustee, the payment of the principal of and interest (including
compounded interest and Additional Sums, if any) on such Debentures held by the
Property Trustee will be made at such place and to such account as may be
designated by the Property Trustee.
SECTION 2.4. Global Debenture.
(a) In connection with a liquidation,
(i) the Debentures in certificated form may be presented to
the Trustee by the Property Trustee in exchange for a global Debenture
in an aggregate principal amount equal to the aggregate principal
amount of all outstanding Debentures (a "Global Debenture"), to be
registered in the name of the Depositary, or its nominee, and delivered
by the Trustee to the Depositary for crediting to the accounts of its
participants pursuant to the instructions of the Regular Trustees. The
Company, upon any such presentation shall execute a Global Debenture in
such aggregate principal amount and deliver the same to the Trustee for
authentication and delivery in accordance with the Indenture and this
First Supplemental Indenture. Payments on the Debentures issued as a
Global Debenture will be made to the Depositary; and
(ii) if any Capital Securities are held in non book-entry
certificated form, the Debentures in certificated form may be presented
to the Trustee by the Property Trustee and any Capital Security
Certificate which represents Capital Securities other than Capital
Securities held by the Clearing Agency or its nominee ("Non Book-Entry
Capital Securities") will be deemed to represent beneficial interests
in Debentures presented to the Trustee by the Property Trustee having
an aggregate principal amount equal to the aggregate Liquidation Amount
of the Non Book-Entry Capital Securities until such Capital Security
Certificates are presented to the Security Registrar for transfer or
reissuance at which time such Capital Security Certificates will be
cancelled and a Debenture, registered in the name of the holder of the
Capital Security Certificate or the transferee of the holder of such
Capital Security Certificate, as the case may be, with an aggregate
principal amount equal to the aggregate Liquidation Amount of the
Capital Security Certificate cancelled, will be executed by the Company
and
6
<PAGE>
delivered to the Trustee for authentication and delivery in accordance
with the Indenture and this First Supplemental Indenture. On issue of
such Debentures, Debentures with an equivalent aggregate principal
amount that were presented by the Property Trustee to the Trustee will
be deemed to have been cancelled.
(b) A Global Debenture may be transferred, in whole but not in
part, only to another nominee of the Depositary, or to a successor
Depositary selected or approved by the Company or to a nominee of such
successor Depositary.
(c) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary or if at any time the
Depositary for such series shall no longer be registered or in good standing
under the Securities Exchange Act of 1934, as amended, or other applicable
statute or regulation, and a successor Depositary for such series is not
appointed by the Company within 90 days after the Company receives such
notice or becomes aware of such condition, as the case may be, the Company
will execute, and, subject to Article III of the Indenture, the Trustee,
upon written notice from the Company, will authenticate and make available
for delivery the Debentures in definitive registered form without coupons,
in authorized denominations, and in an aggregate principal amount equal to
the principal amount of the Global Debenture in exchange for such Global
Debenture. In addition, the Company may at any time determine that the
Debentures shall no longer be represented by a Global Debenture. In such
event the Company will execute, and subject to Section 3.5 of the Indenture,
the Trustee, upon receipt of an Officers' Certificate evidencing such
determination by the Company, will authenticate and deliver the Debentures
in definitive registered form without coupons, in authorized denominations,
and in an aggregate principal amount equal to the principal amount of the
Global Debenture in exchange for such Global Debenture. Upon the exchange of
the Global Debenture for such Debentures in definitive registered form
without coupons, in authorized denominations, the Global Debenture shall be
cancelled by the Trustee. Such Debentures in definitive registered form
issued in exchange for the Global Debenture shall be registered in such
names and in such authorized denominations as the Depositary, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall deliver such Securities to the
Depositary for delivery to the Persons in whose names such Securities are so
registered.
SECTION 2.5. Interest.
(a) Each Debenture will bear interest at the rate of 7 7/8% per
annum (the "Coupon Rate") from the original date of issuance until the
principal thereof becomes due and payable, and
7
<PAGE>
on any overdue principal and (to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment of interest at
the Coupon Rate, compounded quarterly, payable (subject to the provisions of
Article Four hereof) quarterly in arrears on March 1, June 1, September 1
and December 1 of each year (each, an "Interest Payment Date") commencing on
December 1, 1998, to the Person in whose name such Debenture or any
predecessor Debenture is registered, at the close of business on the regular
record date for such interest installment, which shall be the close of
business on the 15th calendar day (whether or not a Business Day)
immediately preceding such Interest Payment Date.
(b) The amount of interest payable for any period less than a full
interest period will be computed on the basis of a 360-day year of twelve
30-day months and the actual days elapsed in a partial month in such period.
The amount of interest payable for any full interest period will be computed
by dividing the Coupon Rate by four. In the event that any date on which
interest is payable on the Debentures is not a Business Day, then payment of
the interest payable on such date will be made on the next succeeding day
which is a Business Day (and without any interest or other payment in
respect of any such delay) with the same force and effect as if made on the
date such payment was originally payable, except that, if such Business Day
is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and
effect as if made on such date.
(c) Accrued interest that is not paid on the applicable Interest
Payment Date will bear additional interest on the amount thereof at the
Coupon Rate, compounded quarterly and computed on the basis of a 360-day
year of twelve 30-day months and the actual days elapsed in a partial month
in such period. The amount of additional interest payable for any full
interest period will be computed by dividing the Coupon Rate by four.
(d) If, at any time the Property Trustee is the Holder of any
Debentures, the Trust or the Property Trustee is required to pay any taxes,
duties, assessments or governmental charges of whatever nature (other than
withholding taxes) imposed by the United States, or any other taxing
authority, then, in any case, the Company will pay as additional interest
("Additional Sums") on the Debentures held by the Property Trustee, such
additional amounts as shall be required so that the net amounts received and
retained by the Trust and the Property Trustee after paying such taxes,
duties, assessments or other governmental charges will be equal to the
amounts the Trust and the Property Trustee would have received had no such
taxes, duties, assessments or other government charges been imposed.
8
<PAGE>
ARTICLE III
REDEMPTION OF THE DEBENTURES
SECTION 3.1. Tax Event or Investment Company Event Redemption.
(a) If a Tax Event or Investment Company Event has occurred and is
continuing then, notwithstanding Section 3.2(a) but subject to Section
3.2(b) the Company shall have the right, upon not less than 30 days' nor
more than 60 days' written notice to the Holders of the Debentures, to
redeem the Debentures, in whole (but not in part), for cash, at any time
prior to September 24, 2003 and within 90 days following the occurrence of
such Tax Event or Investment Company Event (the "90 Day Period") at a
redemption price (the "Redemption Price") equal to the accrued and unpaid
interest on the Debentures so redeemed to the date fixed for redemption,
plus 100% of the principal amount thereof. The Redemption Price shall be
paid prior to 12:00 noon, New York time, on the date of such redemption or
such earlier time as the Company determines, provided that the Company shall
deposit with the Trustee an amount sufficient to pay the Redemption Price by
10:00 a.m., New York time, on the date such Redemption Price is to be paid.
(b) The Company's right to redeem the Debentures pursuant to this
Section 3.1(a) shall be subject to the condition that if at the time there
is available to the Company or the Trust the opportunity to eliminate,
within the 90-Day Period, the Tax Event or Investment Company Event by
taking some ministerial action ("Ministerial Action"), such as filing a form
or making an election, or pursuing some other similar reasonable measure
that will have no adverse effect on the Company, the Trust or the Holders of
the Debentures and will involve no material cost, the Company shall pursue
such measures in lieu of redemption; pro vided further, that the Company
shall have no right to redeem the Debentures while the Trust is pursuing any
Ministerial Action pursuant to the Declaration.
SECTION 3.2. Optional Redemption by Company.
(a) Subject to the provisions of Section 3.2(b) and to the
provisions of Article XII of the Indenture, except as other-wise may be
specified in this First Supplemental Indenture, the Company shall have the
right to redeem the Debentures, in whole or in part, at any time or from
time to time, on or after September 24, 2003, at a redemption price equal
to the accrued and unpaid interest on the Debentures so redeemed to the date
fixed for redemption, plus 100% of the principal amount thereof (the
"Optional Redemption Price").
Any redemption pursuant to this paragraph will be made upon not
less than 30 days nor more than 60 days' notice before
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the redemption date to each Holder of the Debentures, at the Optional Redemption
Price. If the Debentures are only partially redeemed pursuant to this Section
3.2, the Debentures will be redeemed pro rata or by lot or by any other method
utilized by the Trustee; provided, that if at the time of redemption the
Debentures are registered as Global Debenture, the Depositary shall determine,
in accordance with its procedures, the principal amount of such Debentures held
by each Holder of Debenture to be redeemed. The Optional Redemption Price shall
be paid prior to 12:00 noon, New York time, on the date of such redemption or at
such earlier time as the Company determines provided that the Company shall
deposit with the Trustee an amount sufficient to pay the Optional Redemption
Price by 10:00 a.m., New York time, on the date such Optional Redemption Price
is to be paid.
(b) If a partial redemption of the Debentures would result in the
delisting of the Capital Securities issued by the Trust from any national
securities exchange or other organization on which the Capital Securities
are then listed, the Company shall not be permitted to effect such partial
redemption and may only redeem the Debentures in whole.
SECTION 3.4 No Sinking Fund.
The Debentures are not entitled to the benefit of any sinking
fund.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.1. Extension of Interest Payment Period.
The Company shall have the right, at any time and from time to
time during the term of the Debentures, so long as no Event of Default has
occurred and is continuing, to defer payments of interest by extending the
interest payment period of such Debentures for a period not exceeding 20
consecutive quarterly periods (the "Extension Period"), during which Extension
Period no interest shall be due and payable; provided that no Extension Period
may extend beyond the Stated Maturity or end on a day other than an Interest
Payment Date. To the extent permitted by applicable law, interest, the payment
of which has been deferred because of the extension of the interest payment
period pursuant to this Section 4.1, will bear interest thereon at the Coupon
Rate, compounded quarterly for each quarterly period of the Extension Period. At
the end of the Extension Period, the Company shall pay all interest then accrued
and unpaid (together with interest thereon at the Coupon Rate, compounded
quarterly and computed on the basis of a 360-day year of twelve 30-day
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months and the actual days elapsed in a partial month in such period). The
amount of additional interest payable for any full interest period will be
computed by dividing the rate per annum by four. During an Extension Period,
interest will continue to accrue and Holders of Debentures (or holders of
Capital Securities while outstanding) will be required to accrue interest
income for United States Federal income tax purposes, including any Additional
Sums and compounded interest (together, "Deferred Interest") that shall be
payable to the Holders of the Debentures in whose names the Debentures are
registered in the Security Register on the first record date after the end of
the Extension Period. Before the termination of any Extension Period, the
Company may further extend such period, provided that such period together with
all such previous and further extensions thereof shall not exceed 20 consecutive
quarterly periods, or extend beyond the Stated Maturity, or except as provided
below, end on a day other than an Interest Payment Date. In the event that the
Stated Maturity is advanced to a date prior to the end of an Extension Period,
such Extension Period shall be deemed to end on such date or such earlier date
as may be determined by the Company. In the event that any Debentures are called
for redemption on a date prior to the end of an Extension Period, with respect
to such Debentures, such Extension Period shall be deemed to end on such date or
such earlier date as may be determined by the Company. Upon the termination of
any Extension Period and upon the payment of all Deferred Interest then due, the
Company may commence a new Extension Period, subject to the foregoing
requirements. No interest shall be due and payable during an Extension Period,
except at the end thereof, but the Company may prepay at any time all or any
portion of the interest accrued during an Extension Period. There is no
limitation on the number of times that the Company may elect to begin an
Extension Period.
SECTION 4.2. Notice of Extension.
(a) If the Property Trustee is the only registered Holder of the
Debentures at the time the Company selects an Extension Period, the Company
shall give written notice to the Regular Trustees, the Property Trustee and
the Trustee of its selection of such Extension Period on the earlier of (i)
10 Business Days prior to the next succeeding date on which Distributions
on the Capital Securities issued by the Trust are payable, or (ii) the date
the Regular Trustees are required to give notice of the record date, or the
date such Distributions are payable, to the New York Stock Exchange or other
applicable self-regulatory organization or to holders of the Capital
Securities issued by the Trust, but in any event at least one Business Day
before such record date.
(b) If the Property Trustee is not the only Holder of the
Debentures at the time the Company selects an Extension Period, the Company
shall give the Holders of the Debentures and
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the Trustee written notice of its selection of such Extension Period at
least 10 Business Days before the earlier of (i) the next succeeding
Interest Payment Date, or (ii) the date the Company is required to give
notice of the record or payment date of such interest payment to the New
York Stock Exchange or other applicable self-regulatory organization or to
Holders of the Debentures.
(c) The period in which any notice is given pursuant to paragraphs
(a) or (b) of this Section 4.2 shall be counted as one of the 20 quarterly
periods permitted in the maximum Extension Period permitted under Section
4.1.
SECTION 4.3. Limitation of Transactions.
If (i) the Company shall exercise its right to defer payment of
interest as provided in Section 4.1, (ii) there shall have occurred any Event of
Default, as defined in the Indenture, or (iii) the Company shall be in default
with respect to its payment of any obligations under the Capital Securities
Guarantee then the Company (a) shall not declare or pay dividends on, make
distributions with respect to or redeem, purchase or acquire, or make a
liquidation payment with respect to, any of its capital stock (other than stock
dividends paid by the Company which consist of stock of the same class as that
on which the dividend is being paid), (b) shall not make any payment of
interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities issued by the Company that rank pari passu with or junior to the
Debentures, including the 5 1/4% Debentures, and (c) shall not make any Capital
Securities Guarantee payments with respect to the foregoing (other than pursuant
to the Capital Securities Guarantee).
ARTICLE V
EXPENSES
SECTION 5.1. Payment of Expenses.
In connection with the offering, sale and issuance of the
Debentures to the Property Trustee and in connection with the sale of the
Capital Securities and Common Securities by the Trust, the Company, in its
capacity as borrower with respect to the Debentures, shall:
(a) pay all costs and expenses relating to the offering, sale and
issuance of the Debentures, including commissions to the underwriters
payable pursuant to the Underwriting Agreement and compensation of the
Trustee under the Indenture in accordance with the provisions of Section 6.5
of the Indenture;
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(b) pay all costs and expenses of the Trust (including, but not
limited to, costs and expenses relating to the organization of the Trust,
the offering, sale and issuance of the Capital Securities and Common
Securities (including commissions to the Underwriters in connection
therewith), the fees and expenses of the Property Trustee and the Delaware
Trustee, the costs and expenses relating to the operation of the Trust,
including without limitation, costs and expenses of accountants, attorneys,
statistical or bookkeeping services, expenses for printing and engraving and
computing or accounting equipment, paying agent(s), registrar(s), transfer
agent(s), duplicating, travel and telephone and other telecommunications
expenses and costs and expenses incurred in connection with the acquisition,
financing, and disposition of Trust assets);
(c) be primarily and fully liable for any indemnification
obligations arising with respect to the Declaration; and
(d) pay any and all taxes, duties, assessments or other
governmental charges of whatever nature and all costs and expenses with
respect thereto (other than United States with-holding taxes attributable to
the Trust or its assets) to which the Trust might become subject so that the
net amounts received and retained by the Trust after paying such debts,
obligations, costs, expenses, taxes, duties, assessments or other
governmental charges will be equal to the amounts that the Trust would have
received and retained had such debts, obligations, costs, expenses, taxes,
duties, assessments or other governmental charges not been incurred by or
imposed on the Trust.
(e) The foregoing obligations of the Company under the Debentures
owned by the Trust are for the benefit of, and shall be enforceable by, any
person to whom any such debts, obligations, costs, expenses and taxes are
owed (a "Creditor") whether or not such Creditor has received notice
thereof. Any such Creditor may enforce such obligations of the Company
directly against the Company, and the Company will irrevocably waive any
right or remedy to require that any such Creditor take any action against
the Trust or any other person before proceeding against the Company. The
Company agrees to execute such additional agreement as may be necessary or
desirable to give full effect to the foregoing.
SECTION 5.2. Payment Upon Resignation or Removal.
Upon termination of this First Supplemental Indenture or the
Indenture or the removal or resignation of the Trustee, unless otherwise stated,
the Company shall pay to the Trustee all amounts accrued to the date of such
termination, removal or resignation. Upon termination of the Declaration or the
removal or resignation of the Delaware Trustee or the Property Trustee, as the
case may be, pursuant to Section 5.6 of the Declaration,
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the Company shall pay to the Delaware Trustee or the Property Trustee, as the
case may be, all amounts accrued to the date of such termination, removal or
resignation.
ARTICLE VI
ADDITIONAL COVENANTS
SECTION 6.1. Listing on an Exchange.
If the Debentures are to be issued as a Global Debenture in
connection with the distribution of the Debentures to the holders of the Capital
Securities issued by the Trust upon the liquidation of the Trust, the Company
will use its best efforts to list such Debentures on the New York Stock
Exchange, Inc. or on such other exchange as the Capital Securities are then
listed.
SECTION 6.2. Ownership of Common Securities
The Company will directly or indirectly maintain 100% ownership of
the Common Securities of the Trust (provided, however, that any permitted
successor of the Company under the Indenture may succeed to the Company's
ownership of such Common Securities).
SECTION 6.3 Maintenance of Trust
The Company will use its reasonable efforts to cause the Trust (i)
to remain a statutory business trust, (except as provided in the Declaration)
and (ii) to otherwise continue to be classified as a grantor trust for United
States Federal income tax purposes.
Article VII
VOTING RIGHTS
SECTION 7.1 Debenture Holder Voting Rights.
(a) The provisions of Sections 5.2, 5.12 and 5.13 of the Indenture
are supplemented by the provisions of this Section 7.1.
(b) The Holders of at least a majority in aggregate principal
amount of outstanding Debentures have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the
Trustee. The Trustee or the Holders of not less than 25% in aggregate
principal amount of outstanding Debentures may declare the principal due and
payable immediately upon an Event of Default, and, should the Trustee or
such Holders of Debentures fail to make such declaration, the holders of at
least 25% in aggregate Liquidation Amount of the
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outstanding Capital Securities shall have such right. The Holders of a
majority in aggregate principal amount of outstanding Debentures, with the
consent of a majority in aggregate Liquidation Amount of the outstanding
Capital Securities, if such Debentures are held by the Trust, may annul such
declaration and waive the default if all defaults (other than the
non-payment of the principal of Debentures which has become due solely by
such acceleration) have been cured and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration
has been deposited with the Trustee. Should the Holders of Debentures fail
to annul such declaration and waive such default, the holders of a majority
in aggregate Liquidation Amount of the outstanding Capital Securities shall
have such right.
(c) The Holders of at least a majority in aggregate principal
amount of the outstanding Debentures affected thereby may, on behalf of the
Holders of all the Debentures, waive any past default, except a default in
the payment of principal (or premium, if any) or interest (unless such
default has been cured and a sum sufficient to pay all matured installments
of interest and principal due otherwise than by acceleration has been
deposited with the Trustee) or a default in respect of a covenant or
provision which under the Indenture cannot be modified or amended without
the consent of the Holder of each outstanding Debenture affected thereby,
provided, that if the Debentures are held by the Trust or the Property
Trustee, such waiver shall not be effective as to the Debentures unless the
holders of at least a majority in aggregate Liquidation Amount of the
Capital Securities shall have consented to such waiver; provided further,
that if the consent of the Holder of each outstanding Debenture is required,
such waiver shall not be effective unless each holder of the Capital
Securities shall have consented to such waiver. The Company is required to
file annually with the Trustee a certificate as to whether or not the
Company is in compliance with all the conditions and covenants applicable to
it under the Indenture.
(d) If an Event of Default occurs and is continuing, the Property
Trustee will have the right to declare the principal of and the interest on
the Debentures, and any other amounts payable under the Debentures and the
Indenture, to be forthwith due and payable and to enforce its other rights
as a creditor with respect to the Debentures.
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ARTICLE VIII
SUBORDINATION
SECTION 8.1 Subordination of Debentures.
Article XVI of the Indenture provides that the Debentures are
subordinate and junior in right of payment to all Senior Indebtedness (the
definition of which in the Indenture shall be deemed to be amended and restated
in its entirety as set forth in Section 1.1 hereof) of the Company. Subject to
such Article XVI and Section 9.7 of the Indenture, no payment of principal of
(including redemption payments), or interest on, the Debentures may be made (i)
if any Senior Indebtedness is not paid when due, any applicable grace period
with respect to such default has ended and such default has not been cured or
waived, or (ii) if the maturity of any Senior Indebtedness has been accelerated
because of a default. Upon any distribution of assets of the Company to
creditors upon any dissolution, winding up, liquidation or reorganization,
whether voluntary or involuntary or in bankruptcy, insolvency, receivership or
other proceedings, all principal of, and premium, if any, and interest due or to
become due on, all Senior Indebtedness must be paid in full before the Holders
of the Debentures are entitled to receive or retain any payment. In the event
that, notwithstanding the foregoing, any payment or distribution of cash,
property or securities shall be received or collected by a Holder of the
Debentures in contravention of the foregoing provisions, such payment or
distribution shall be held for the benefit of and shall be paid over to the
holders of Senior Indebtedness or their representative or representatives or to
the trustee or trustees under any indenture under which any instrument
evidencing Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay in full all Senior
Indebtedness then due, after giving effect to any concurrent payment to the
holders of Senior Indebtedness. Subject to the payment in full of all Senior
Indebtedness, the rights of the Holders of the Debentures will be subrogated to
the rights of the holders of Senior Indebtedness to receive payments or
distributions applicable to Senior Indebtedness until all amounts owing on the
Debentures are paid in full.
ARTICLE IX
MODIFICATION
SECTION 9.1 Modification of Indenture and First Supplemental
Indenture.
So long as any of the Capital Securities remain outstanding, no
modification of the Indenture or this First Supplemental Indenture may be made
that adversely affects the holders
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of such Capital Securities in any material respect, and no termination of the
Indenture may occur, and no waiver of any Event of Default may be effective,
without the prior consent of the holders of at least 66 2/3% of the aggregate
Liquidation Amount of the outstanding Capital Securities unless and until the
principal of (and premium, if any, on) the Debentures and all accrued and unpaid
interest thereon have been paid in full and certain other conditions are
satisfied. In addition, the Company may not amend the Indenture to remove the
rights of holders of Capital Securities of the Trust to institute a direct
action without the prior written consent of all the holders of Capital
Securities or to remove the obligation to obtain the consent of holders of
Capital Securities as provided for, or without the consent of the required
percentage of holders of the Capital Securities of the Trust. So long as the
Company acts in accordance with the terms of the Debentures and the Indenture,
the Company may advance the Stated Maturity of and defer interest payable on the
Debentures, in each case without the consent of the Trust or the holders of the
Capital Securities.
ARTICLE X
FORM OF DEBENTURE
SECTION 10.1. Form of Debenture.
The Debentures and the Trustee's Certificate of Authentication to
be endorsed thereon are to be substantially in the following forms:
(FORM OF FACE OF DEBENTURE)
[IF THE DEBENTURE IS TO BE A GLOBAL DEBENTURE, INSERT-This
Debenture is a Global Debenture within the meaning of the Indenture hereinafter
referred to and is registered in the name of a Depositary or a nominee of a
Depositary. This Debenture is exchangeable for Debentures registered in the name
of a person other than the Depositary or its nominee only in the limited
circumstances described in the Indenture, and no transfer of this Debenture
(other than a transfer of this Debenture as a whole by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary) may be registered except in limited
circumstances.
Unless this Debenture is presented by an authorized representative
of The Depository Trust Company (55 Water Street, New York, New York) to the
issuer or its agent for registration of transfer, exchange or payment, and any
Debenture issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment hereon is made to Cede & Co., ANY TRANSFER,
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PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since
the registered owner hereof, Cede & Co., has an interest herein.]
No. CUSIP No. 460146BC6
------------------------
INTERNATIONAL PAPER COMPANY
7 7/8% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE
DUE 2038
INTERNATIONAL PAPER COMPANY, a New York corporation (the
"Company", which term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
______________ or registered assigns, the principal sum of _____________ Dollars
($___________) on December 1, 2038, and to pay interest on said principal sum
from the date of original issuance, or from the most recent interest payment
date to which interest has been paid or duly provided for, quarterly (subject to
deferral as set forth herein) in arrears on March 1, June 1, September 1 and
December 1 of each year (each such date, an "Interest Payment Date") commencing
December 1, 1998, at the rate of 7 7/8% per annum until the principal hereof
shall have become due and payable, and on any overdue principal and premium, if
any, and (without duplication and to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment of interest at the
same rate per annum compounded quarterly. The amount of interest payable for any
period less than a full interest period will be computed on the basis of a
360-day year of twelve 30-day months and the actual days elapsed in a partial
month in such period. The amount of interest payable for any full interest
period will be computed by dividing the Coupon Rate by four. In the event that
any date on which interest is payable on the Debentures is not a Business Day,
then payment of the interest payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay) with the same force and effect as if made
on the date such payment was originally payable, except that, if such Business
Day is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date. The interest installment so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the person in whose name this Debenture (or one or more
Predecessor Securities, as defined in said Indenture) is registered at the close
of business on the regular record date for such interest installment, which
shall be the close of business on the regular record date for such interest
installment, which shall be the close of business on the 15th calendar day
(whether or not a Business Day) immediately preceding
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such Interest Payment Date. Any such interest installment not punctually paid or
duly provided for shall forthwith cease to be payable to the registered Holders
on such regular record date and may be paid to the Person in whose name this
Debenture (or one or more Predecessor Securities) is registered at the close of
business on a special record date to be fixed by the Trustee for the payment of
such defaulted interest, notice whereof shall be given to the registered Holders
of this series of Debentures not less than 10 days prior to such special record
date, or may be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Debentures may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in the Indenture. The principal of (and premium, if any) and the
interest on this Debenture shall be payable at the office or agency of the
Trustee maintained for that purpose in any coin or currency of the United States
of America that at the time of payment is legal tender for payment of public and
private debts; provided, however, that payment of interest may be made at the
option of the Company by check mailed to the registered Holder at such address
as shall appear in the Security Register. However, a Holder of $1 million or
more in aggregate principal amount of Debentures may receive payments of
interest (other than interest payable at the Stated Maturity) by wire transfer
of immediately available funds upon written request to the Trustee not later
than 15 calendar days prior to the date on which the interest is payable.
Notwithstanding the foregoing, so long as the Holder of this Debenture is the
Property Trustee, the payment of the principal of (and premium, if any) and
interest (including compounded interest and Additional Sums, if any) on this
Debenture will be made at such place and to such account as may be designated by
the Property Trustee.
Accrued interest that is not paid on the applicable Interest
Payment Date will bear additional interest on the amount thereof at the Coupon
Rate, compounded quarterly and computed on the basis of a 360-day year of twelve
30-day months and the actual days elapsed in a partial month in such period. The
amount of additional interest payable for any full interest period will be
computed by dividing the Coupon Rate by four.
If, at any time the Property Trustee is the Holder of any
Debentures, the Trust or the Property Trustee is required to pay any taxes,
duties, assessments or governmental charges of whatever nature (other than
withholding taxes) imposed by the United States, or any other taxing authority,
then, in any case, the Company will pay as additional interest ("Additional
Sums") on the Debentures held by the Property Trustee, such additional amounts
as shall be required so that the net amounts received and retained by the Trust
and the Property Trustee after paying such taxes, duties, assessments or other
governmental charges will be equal to the amounts the Trust and the Property
Trustee would
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have received had no such taxes, duties, assessments or other government charges
been imposed.
The indebtedness evidenced by this Debenture is, to the extent
provided in the Indenture, subordinate and junior in right of payment to the
prior payment in full of all Senior Indebtedness and pari passu in right of
payment with the Company's 5 1/4% Junior Subordinated Deferrable Interest
Debentures due 2025, and this Debenture is issued subject to the provisions of
the Indenture with respect thereto. Each Holder of this Debenture, by accepting
the same, (a) agrees to and shall be bound by such provisions, (b) authorizes
and directs the Trustee on his or her behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination so
provided and (c) appoints the Trustee his or her attorney-in-fact for any and
all such purposes. Each Holder hereof, by his or her acceptance hereof, hereby
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon
said provisions.
This Debenture shall not be entitled to any benefit under the
Indenture hereinafter referred to, be valid or become obligatory for any purpose
until the Certificate of Authentication hereon shall have been signed by or on
behalf of the Trustee.
The provisions of this Debenture are continued on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed on this [ ]th day of [ ], [ ].
INTERNATIONAL PAPER COMPANY
By:
----------------------------
Name:
Title
Attest:
By:
------------------------
Name:
Title:
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(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
referred to in the within-mentioned Indenture.
Dated
-----------------------
The Bank of New York,
as Trustee
By
--------------------------
Authorized Signatory
(FORM OF REVERSE OF DEBENTURE)
This Debenture is one of a duly authorized series of Debentures of
the Company (herein sometimes referred to as the "Debentures"), specified in the
Indenture, all issued or to be issued in one or more series under and pursuant
to an Indenture dated as of September 15, 1998, duly executed and delivered
between the Company and The Bank of New York as Trustee (the "Trustee"), as
supplemented by the First Supplemented Indenture dated as of September 24, 1998,
between the Company and the Trustee (the Indenture, as so supplemented, the
"Indenture"), to which Indenture and all indentures supplemental thereto
reference is hereby made for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Company and
the Holders of the Debentures. By the terms of the Indenture, the Debentures are
issuable in series that may vary as to amount, date of maturity, rate of
interest and in other respects as provided in the Indenture. This series of
Debentures is limited in aggregate principal amount as specified in said First
Supplemental Indenture.
Because of the occurrence and continuation of a Tax Event or an
Investment Company Event, in certain circumstances, this Debenture may become
due and payable, in whole (but not in part) at any time prior to September 24,
2003 and within 90 days of the occurrence of such Tax Event or Investment
Company Event, at a redemption price (the "Redemption Price") equal to the
accrued and unpaid interest on the Debentures so redeemed to the date fixed for
redemption, plus 100% of the principal amount thereof.
The Company shall have the right to redeem this Debenture at the
option of the Company, without premium or penalty, in whole or in part, on or
after September 24, 2003 (an "Optional Redemption"), at a redemption price equal
to the accrued and
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unpaid interest on the Debentures so redeemed to the date fixed for redemption,
plus 100% of the principal amount thereof.
Any redemption pursuant to either of the two preceding paragraphs
will be made upon not less than 30 days nor more than 60 days notice before the
redemption date, at the Redemption Price. If the Debentures are only partially
redeemed by the Company pursuant to an Optional Redemption, the Debentures will
be redeemed pro rata or by lot or by any other method utilized by the Trustee;
provided that if, at the time of redemption, the Debentures are registered as a
Global Debenture, the Depositary shall determine the principal amount of such
Debentures held by each Debenture Holder to be redeemed in accordance with its
procedures.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures of this series for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.
In case an Event of Default, as defined in the Indenture, shall
have occurred and be continuing, the principal of all of the Debentures may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the Holders of not less than 66 2/3% in aggregate
principal amount of the Debentures of each series affected at the time
outstanding, as defined in the Indenture, to execute supplemental indentures for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of the Indenture or of any supplemental indenture or of
modifying in any manner the rights of the Holders of the Debentures; provided,
however, that no such supplemental indenture shall (i) extend the fixed maturity
of any Debentures of any series, or reduce the principal amount thereof, or
reduce the rate or extend the time of payment of interest thereon, or reduce any
premium payable upon the redemption thereof, without the consent of the Holder
of each Debenture so affected, or (ii) reduce the aforesaid percentage of
Debentures, the Holders of which are required to consent to any such
supplemental indenture, without the consent of the Holders of each Debenture
then outstanding and affected thereby. The Indenture also contains provisions
permitting the Holders of a majority in aggregate principal amount of the
Debentures of any series at the time outstanding affected thereby, on behalf of
all of the Holders of the Debentures of such series, to waive any past default
in the performance of any of the covenants contained in the Indenture, or
established pursuant to the Indenture with respect to such series, and its
consequences, except a default in the payment of the principal of or premium, if
any, or interest
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on any of the Debentures of such series. Any such consent or waiver by the
registered Holder of this Debenture (unless revoked as provided in the
Indenture) shall be conclusive and binding upon such Holder and upon all future
Holders and owners of this Debenture and of any Debenture issued in exchange
therefor or in place hereof (whether by registration of transfer or otherwise),
irrespective of whether or not any notation of such consent or waiver is made
upon this Debenture.
No reference herein to the Indenture and no provision of this
Debenture 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 on this Debenture at the time and place and at the
rate and in the money herein prescribed.
The Company shall have the right at any time during the term of
the Debentures and from time to time to extend the interest payment period of
such Debentures for up to 20 consecutive quarterly periods (an "Extension
Period"), at the end of which period the Company shall pay all interest then
accrued and unpaid (together with interest thereon compounded quarterly at the
rate specified for the Debentures to the extent that payment of such interest is
enforceable under applicable law); provided that no Extension Period may last
beyond the maturity date of the Debentures or end on a date other than an
Interest Payment Date. Before the termination of any such Extension Period, the
Company may further extend such Extension Period, provided that such Extension
Period together with all such previous and further extensions thereof shall not
exceed 20 consecutive quarterly periods or extend the maturity date of the
Debentures. At the termination of any such Extension Period and upon the payment
of all accrued and unpaid interest and any Additional Sums then due, the Company
may commence a new Extension Period.
The Company has agreed that during such Extension Period it (a)
shall not declare or pay dividends on, make distributions with respect to or
redeem, purchase or acquire, or make a liquidation payment with respect to, any
of its capital stock (other than stock dividends paid by the Company which
consist of stock of the same class as that on which the dividend is being paid),
(b) shall not make any payment of interest, principal or premium, if any, on or
repay, repurchase or redeem any debt securities issued by the Company that rank
pari passu with or junior to the Debentures, including the 5 1/4% Debentures,
and (c) shall not make any Capital Securities Guarantee payments with respect to
the foregoing (other than pursuant to the Capital Securities Guarantee).
As provided in the Indenture and subject to certain limitations
therein set forth, this Debenture is transferable by the registered Holder
hereof on the Security Register of the
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Company, upon surrender of this Debenture for registration of transfer at the
office or agency of the Trustee in the City and State of New York accompanied by
a written instrument or instruments of transfer in form satisfactory to the
Company or the Trustee duly executed by the registered Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Debentures of
authorized denominations and for the same aggregate principal amount and series
will be issued to the designated transferee or transferees. No service charge
will be made for any such transfer, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in relation
thereto.
Prior to due presentment for registration of transfer of this
Debenture, the Company, the Trustee, any paying agent and the Security Registrar
may deem and treat the registered Holder hereof as the absolute owner hereof
(whether or not this Deben ture shall be overdue and notwithstanding any notice
of ownership or writing hereon made by anyone other than the Security
Registrar) for the purpose of receiving payment of or on account of the
principal hereof and premium, if any, and interest due hereon and for all other
purposes, and neither the Company nor the Trustee nor any paying agent nor any
Security Registrar shall be affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of or
the interest on this Debenture, or for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture, against any
incorporator, stockholder, officer or director, past, present or future, as
such, of the Company or of any predecessor or successor corporation, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released.
The Debentures of this series are issuable only in registered form
without coupons in denominations of $50 and any integral multiple thereof. This
Global Debenture is exchangeable for Debentures in definitive form only under
certain limited circumstances set forth in the Indenture. Debentures of this
series so issued are issuable only in registered form without coupons in
denominations of $50 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations herein and therein set forth,
Debentures of this series so issued are exchangeable for a like aggregate
principal amount of Debentures of this series of a different authorized
denomination, as requested by the Holder surrendering the same.
All terms used in this Debenture that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
24
<PAGE>
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN THE
INDENTURE AND THE DEBENTURES WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS
THEREOF.
ARTICLE XI
ORIGINAL ISSUE OF DEBENTURES
SECTION 11.1. Original Issue of Debentures.
Debentures in the aggregate principal amount of $721,649,500 (or
$829,896,925 if the Option is exercised in full may, upon execution of this
First Supplemental Indenture, be executed by the Company and delivered to the
Trustee for authentication, and the Trustee shall thereupon authenticate and
deliver said Debentures to or upon the written order of the Company, signed by
its Chairman, its Vice Chairman, its President, or any Vice President and its
Treasurer or an Assistant Treasurer, without any further action by the Company.
ARTICLE XII
MISCELLANEOUS
SECTION 12.1. Ratification of Indenture.
The Indenture, as supplemented by this First Supplemental
Indenture, is in all respects ratified and confirmed, and this First
Supplemental Indenture shall be deemed part of the Indenture in the manner and
to the extent herein and therein provided.
SECTION 12.2. Trustee Not Responsible for Recitals.
The recitals herein contained are made by the Company and not by
the Trustee, and the Trustee assumes no responsibility for the correctness
thereof. The Trustee makes no representation as to the validity or sufficiency
of this First Supplemental Indenture.
SECTION 12.3. Governing Law.
This First Supplemental Indenture and each Debenture shall be
governed by and construed in accordance with the laws of the State of New York
without regard to conflicts of laws.
SECTION 12.4. Separability.
In case any one or more of the provisions contained in this First
Supplemental Indenture or in the Debentures shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall
25
<PAGE>
not affect any other provisions of this First Supplemental Indenture or of the
Debentures, but this First Supplemental Indenture and the Debentures shall be
construed as if such invalid or illegal or unenforceable provision had never
been contained herein or therein.
SECTION 12.5. Counterparts.
This First Supplemental Indenture may be executed in any number of
counterparts each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, on the date or dates indicated in the
acknowledgments and as of the day and year first above written.
INTERNATIONAL PAPER COMPANY
By /s/ E. William Boehmler
------------------------------
Name: E. William Boehmler
Title: Vice President
[Seal]
Attest:
By: /s/Carol Samalin
------------------
THE BANK OF NEW YORK
as Trustee
By /s/ Mary LaGumina
------------------------------
Name: Mary LaGumina
Title: Assistant Vice President
Attest:
By: /s/Remo Reale
-----------------
27
<PAGE>
Exhibit 5.1
[IP LOGO]
TWO MANHATTANVILLE ROAD
PURCHASE, NY 10577
September 24, 1998
Securities and Exchange Commission
Judiciary Plaza
450 5th Street, N.W.
Washington, D.C. 20549
Re: International Paper Company,
International Paper Capital Trust III and
International Paper Capital Trust IV
Registration Statement on Form S-3
Dear Sirs:
This opinion is furnished by me as counsel for International Paper
Company, a New York corporation (the "Company"), in connection with the
Registration Statement on Form S-3 filed by the Company with the Securities and
Exchange Commission under the Securities Act of 1933, as amended (the
"Securities Act"). The Registration Statement relates to the issuance and sale
from time to time, of, among other securities, the following securities of the
Company with an aggregate initial public offering price of up to $1,100,000,000
or the equivalent thereof, based on the applicable exchange rate at the time of
sale, in one or more foreign currencies, currency units or composite currencies
as shall be designated by the Company: (i) debt securities (the "Debt
Securities") which may be either senior debt securities (the "Senior Debt
Securities") or subordinated debt securities (the "Subordinated Debt
Securities"); (ii) shares of its serial preferred stock, $1.00 par value (the
"Preferred Stock"), which may also be issued in the form of depositary shares
(the "Depositary Shares") evidenced by depositary receipts
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(the "Receipts"); (iii) shares of its common stock, $1.00 par value (the "Common
Stock"); (iv) warrants to purchase securities of the Company as shall be
designated by the Company at the time of offering (the "Warrants"); (v) such
indeterminate number of shares of Common Stock as may be issued upon conversion
or exchange of any securities, including such shares of Common Stock as may be
issued pursuant to anti-dilution adjustments, in amounts, at prices and on terms
to be determined at the time of offering (the "Indeterminate Securities"); and
(vi) the Guarantee (as defined below) of the Company with respect to certain
Trust Preferred Securities that may be issued by International Paper Capital
Trust III and International Paper Capital Trust IV (each a "Trust") pursuant to
an Amended and Restated Declaration of Trust of each Trust (the "Declaration"),
among the Company, as sponsor and as the issuer of certain debentures to be held
by the Property Trustee (as defined below), The Bank of New York, as Property
Trustee (the "Property Trustee"), The Bank of New York (Delaware), as Delaware
trustee, and the regular trustees named therein. Pursuant to Rule 429 under the
Securities Act, the prospectus included in the Registration Statement also
relates to $2,000,000,000 in aggregate proceeds of securities registered under
Registration Statement No. 33-52945 and $400,000,000 in aggregate proceeds of
securities registered as Debt Securities under Registration Statement No.
33-48167 (such $2,400,000,000 of securities collectively referred to as the
"Registered Securities" and the two registration statements collectively, the
"Prior Registration Statements"). The Debt Securities, Preferred Stock, Common
Stock, Warrants, Indeterminate Securities, Registered Securities and Guarantee
are collectively referred to herein as the "Securities." The Senior Debt
Securities may be issued under an Indenture (the "Senior Indenture") proposed to
be entered into between the Company and The Chase Manhattan Bank, N.A. or
another trustee (the "Senior Indenture Trustee"). The Subordinated Debt
Securities may be issued under a separate Indenture (the "Subordinated
Indenture" and, together with the Senior Indenture, the "Indentures"), proposed
to be entered into between the Company and The Chase Manhattan Bank, N.A., or
another trustee (the "Subordinated Indenture Trustee" and, together with the
Senior Indenture Trustee, the "Trustees").
This opinion is delivered in accordance with the requirements of Items
601(b) (5) of Regulation S-K under the Securities Act.
2
<PAGE>
I have examined and am familiar with originals or copies of such
documents, corporate records and other instruments as I have deemed necessary or
appropriate in connection with this opinion, including (i) the form of
Registration Statement relating to, among other securities the Securities; (ii)
the Prior Registration Statements; (iii) the form of the Senior Indenture; (iv)
the form of the Subordinated Indenture; (v) the forms of underwriting agreements
(including the Underwriting Agreement Standard Provisions relating to firm
commitment underwritten offerings of Debt Securities, Preferred Stock and Common
Stock, respectively, incorporated therein) that may be entered into between the
Company and one or more underwriters named therein in connection with any
offering of the Securities (the "Underwriting Agreements"); (vi) the form of
deposit agreement (the "Deposit Agreement") that may be entered into among the
Company, a depositary to be appointed by the Company (the "Depositary"), and the
holders from time to time of Receipts issued thereunder in connection with any
offering of Depositary Shares; (vii) the Certificate of Incorporation of the
Company, as amended; (viii) the By-laws of the Company as currently in effect;
(ix) resolutions adopted to date by the Board of Directors of the Company (the
"Board") relating to the issuance of the Securities (the "Board Resolutions");
and (x) the form of the Guarantee Agreement (the "Guarantee") between the
Company, as guarantor, and The Bank of New York, as guarantee trustee, for the
benefit of the holders of the Trust Preferred Securities of each Trust.
I am a member of the Bar of the State of New York and do not express
any opinion as to the laws of any other jurisdiction other than the laws of the
United States of America to the extent referred to specifically herein.
Based on the foregoing I am of the opinion that:
1. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of New York.
2. Each of the Indentures has been duly authorized by the Company and,
when executed and delivered by the Company, will be a valid and
3
<PAGE>
binding agreement, enforceable against the Company in accordance with its terms,
except to the extent that enforcement thereof may be limited by (a) bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights generally, (b)
general principles of equity (regardless of whether enforceability is considered
in a proceeding at law or in equity), (c) public policy considerations which may
limit the rights of parties to obtain further remedies, (d) requirements that a
claim with respect to any Debt Securities denominated other than in United
States dollars (or a judgment denominated other than in United States dollars in
respect of such claim) be converted into United States dollars at a rate of
exchange prevailing on a date determined pursuant to applicable law, and (e)
governmental authority to limit, delay or prohibit the making of payments
outside the United States or in foreign currencies, currency units or composite
currencies.
3. With respect to any series of Debt Securities (the "Offered Debt
Securities"), when (i) an appropriate Prospectus Supplement with respect to the
Offered Debt Securities has been prepared, delivered and filed in compliance
with the Securities Act and the applicable rules and regulations thereunder;
(ii) if the Offered Debt Securities are to be sold pursuant to a firm commitment
underwritten offering, the Underwriting Agreement with respect to the Offered
Debt Securities has been duly authorized, executed and delivered by the Company
and the other parties thereto; (iii) the terms of the Offered Debt Securities
and of their issuance and sale have been duly established in conformity with the
applicable Indenture so as not to violate any applicable law, the Restated
Certificate of Incorporation or By-laws of the Company or result in a default
under or breach of any agreement or instrument binding upon the Company and so
as to comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Company; (iv) the applicable
Indenture has been qualified under the Trust Indenture Act of 1939, as amended,
and duly executed and delivered by the Company to the applicable Trustee; and
(v) the Offered Debt Securities have been duly executed and authenticated in
accordance with the provisions of the applicable Indenture and duly delivered to
the purchasers thereof upon payment of the agreed-upon consideration therefor,
(1) the Offered Debt Securities (including any Debt Securities duly issued upon
exercise of any Warrants), when issued and sold in accordance with the
applicable Indenture and
4
<PAGE>
the applicable Underwriting Agreement or any other duly authorized, executed and
delivered applicable valid and binding purchase agreement will be valid and
binding obligations of the Company, enforceable against the Company in
accordance with their respective terms, except to the extent that enforcement
thereof may be limited by (a) bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium or other similar laws now or hereafter in effect relating
to creditors, rights generally, (b) general principles of equity (regardless of
whether enforceability is considered in a proceeding at law or in equity), (c)
public policy considerations which may limit the rights of parties to obtain
further remedies, (d) requirements that a claim with respect to any Offered Debt
Securities denominated other than in United States dollars (or a judgment
denominated other than in United States dollars in respect of such claim) be
converted into United States dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law, and (e) governmental authority to limit,
delay or prohibit the making of payments outside the United States or in foreign
currencies, currency units or composite currencies; and (2) if Common Stock is
issuable upon conversion or exchange of any convertible Securities, the Common
Stock issuable upon conversion or exchange of such Securities will be validly
issued, fully paid and nonassessable, assuming the execution, authentication,
issuance and delivery of the Securities and conversion or exchange of the
Securities in accordance with the terms of the applicable indenture relating
thereto.
4. With respect to the shares of any series of Preferred Stock,
including, if applicable, Depositary Shares representing fractional interests in
any Preferred Stock (together, the "Offered Preferred Stock"), when (i) an
appropriate Prospectus Supplement with respect to the shares of the Offered
Preferred Stock has been prepared, delivered and filed in compliance with the
Securities Act and the applicable rules and regulations thereunder; (ii) if the
Offered Preferred Stock is to be sold pursuant to a firm commitment underwritten
offering, the Underwriting Agreement with respect to the shares of the Offered
Preferred Stock has been duly authorized, executed and delivered by the Company
and the other parties thereto; (iii) the Board, including any appropriate
committee appointed thereby, and appropriate officers of the Company have taken
all necessary corporate action to approve the issuance and terms of the shares
of the offered Preferred Stock and related matters, including the adoption of a
Certificate of Designation
5
<PAGE>
for the Offered Preferred Stock in accordance with the applicable provisions of
New York law (the Certificate of Designation"); (iv) the filing of the
Certificate of Designation with the Secretary of State of the State of New York
has duly occurred; (v) the terms of the Offered Preferred Stock and of their
issuance and sale have been duly established in conformity with the Company's
Restated Certificate of Incorporation, including the Certificate of Designation
relating to the Offered Preferred Stock, and the By-laws of the Company so as
not to violate any applicable law, the Restated Certificate of Incorporation or
By-laws of the Company or result in a default under or breach of any agreement
or instrument binding upon the Company and so as to comply with any requirement
or restriction imposed by any court or governmental body having jurisdiction
over the Company; (vi) in the case of Depositary Shares, the Depositary
Agreement has been duly executed and delivered; and (vii) certificates
representing the shares of the Offered Preferred Stock are duly executed,
countersigned, registered and delivered upon payment of the agreed-upon
consideration therefor (and, in the case of Depositary Shares, such Preferred
Stock certificates are delivered to the Depositary for deposit in accordance
with the laws of the State of New York against issuance of the Receipts
evidencing the Depositary Shares in accordance with the terms of the Deposit
Agreement), (1) the shares of the offered Preferred Stock (including any
Preferred Stock duly issued upon exercise of any Warrants), when issued and sold
in accordance with the applicable Underwriting Agreement or any other duly
authorized, executed and delivered applicable valid and binding purchase
agreement, will be duly authorized, validly issued, fully paid and
nonassessable, provided that the consideration therefor is not less than the par
value thereof; and (2) if the Offered Preferred Stock is convertible or
exchangeable into Common Stock, the Common Stock issuable upon conversion or
exchange of the Offered Preferred Stock will be duly authorized, validly issued,
fully paid and nonassessable, assuming the execution, authentication, issuance
and delivery of the Offered Preferred Stock and the conversion or exchange of
the Offered Preferred Stock in accordance with the terms of the Certificate of
Designation.
5. With respect to any offering of Common Stock, when (i) an
appropriate Prospectus Supplement with respect to the Common Stock has been
prepared, delivered and filed in compliance with the Securities Act and the
applicable
6
<PAGE>
rules and regulations thereunder; (ii) if the Common Stock is to be sold
pursuant to a firm commitment underwritten offering, the Underwriting Agreement
with respect to the Common Stock has been duly authorized, executed and
delivered by the Company and the other parties thereto; (iii) the terms of the
issuance and sale of the Common Stock have been duly established in conformity
with the Restated Certificate of Incorporation and By-laws so as not to violate
any applicable law, the Restated Certificate of Incorporation or By-laws of the
Company or result in a default under or breach of any agreement or instrument
binding upon the Company and so as to comply with any restriction imposed by any
court or governmental body having jurisdiction over the Company; and (iv)
certificates representing the shares of Common Stock are duly executed,
countersigned, registered and delivered upon payment of the agreed-upon
consideration therefor, the shares of Common Stock (including any duly issued
upon exercise of any Warrants), when issued and sold in accordance with the
Underwriting Agreement with respect to the Common Stock or any other duly
authorized, executed and delivered applicable valid and binding purchase
agreement, will be duly authorized, validly issued, fully paid and
nonassessable, provided that the consideration therefor is not less than the par
value thereof.
6. With respect to the issuance of any series of Warrants (the "Offered
Warrants"), when (i) an appropriate Prospectus Supplement with respect to the
offered Warrants has been prepared, delivered and filed in compliance with the
Securities Act and the applicable rules and regulations thereunder; (ii) the
warrant agreement relating to the Offered Warrants (the "Warrant Agreement") in
the form to be filed as an exhibit to the Registration Statement, any amendment
thereto or any document incorporated by reference therein has been duly executed
and delivered as contemplated by the Board Resolutions; (iii) the terms of the
Offered Warrants and of their issuance and sale have been duly established in
conformity with the Warrant Agreement relating to such Offered Warrants so as
not to violate any applicable law, the Restated Certificate of Incorporation or
By-laws of the Company or result in a default under or breach of any agreement
or instrument binding upon the Company and so as to comply with any requirement
or restriction imposed by any court or governmental body having jurisdiction
over the Company; (iv) the Offered Warrants have been duly executed, delivered
and countersigned, in accordance with the Warrant Agreement relating to such
7
<PAGE>
Offered Warrants, and duly issued and sold in the applicable form to be filed as
an exhibit to the Registration Statement or any amendment thereto and in the
manner contemplated in the Registration Statement and any Prospectus Supplement
relating thereto; and (v) if the offered Warrants are to be sold pursuant to a
firm commitment underwritten offering, the Underwriting Agreement with respect
to the Offered Warrants has been duly authorized, executed and delivered by the
Company and the other parties thereto; such Offered Warrants will be valid and
binding obligations of the Company, enforceable against the Company in
accordance with their respective terms, except to the extent that enforcement
thereof may be limited by (a) bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium or other similar laws now or hereafter in effect relating
to creditors' rights generally, (b) general principles of equity (regardless of
whether enforceability is considered in a proceeding at law or in equity), and
(c) public policy considerations which may limit the rights of parties to obtain
further remedies.
7. With respect to the Guarantee, when (i) the Registration Statement,
as finally amended (including all necessary post-effective amendments), has
become effective under the Securities Act; (ii) an appropriate Prospectus
Supplement with respect to the Guarantee has been prepared, delivered and filed
in compliance with the Securities Act and the applicable rules and regulations
thereunder; (iii) the Board, including any appropriate committee appointed
thereby, and appropriate officers of the Company have taken all necessary
corporate action to approve the terms of such Guarantee and related matters;
(iv) the Declaration has been duly executed and delivered by the parties thereto
and duly qualified under the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"); (v) the Guarantee has been duly executed and delivered by the
parties thereto and duly qualified under the Trust Indenture Act; (vi) the terms
of the Trust Preferred Securities have been established in accordance with the
Declaration; (vii) the underwriting agreement with respect to such Trust
Preferred Securities has been duly authorized, executed and delivered by the
parties thereto; and (viii) the Trust Preferred Securities have been delivered
and paid for in the manner contemplated in the Registration Statement or any
Prospectus Supplement relating thereto and have been executed, authenticated and
issued in accordance with the Declaration, the Guarantee will be a valid and
8
<PAGE>
binding agreement of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforcement thereof may be limited by
(a) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or
other similar laws now or hereafter in effect relating to creditors' rights
generally, (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity), and (c)
public policy consideration which may limit the rights of parties to obtain
further remedies.
I hereby consent to the filing of this opinion with the Commission as
Exhibit 5 to the Registration Statement. I also consent to the reference to me
under the heading "Validity of the Securities" in the Registration Statement. In
giving this consent, I do not thereby admit that I am in the category of persons
whose consent is required under Section 7 of the Securities Act or the rules and
regulations of the Commission promulgated thereunder.
Very truly yours,
/s/ James W. Guedry
9
<PAGE>
Exhibit 5.2
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
919 Third Avenue
New York 10022-3897
---
Tel: (212) 735-3000
Fax: (212) 735-2000
September 24, 1998
International Paper Capital Trust III
c/o International Paper Company
Two Manhattanville Road
Purchase, New York 10577
Re: International Paper Company;
International Paper Capital Trust III;
Registration Statement on Form S-3
----------------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel to International Paper
Capital Trust III ("Trust III") and International Paper Capital Trust IV (each,
a "Trust"), each a statutory business trust created under the Business Trust Act
of the State of Delaware (Del. Code Ann., tit. 12, ss.ss. 3801 et seq.), in
connection with the preparation of the Registration Statement on Form S-3 filed
by International Paper Company (the "Company") and each Trust for the
registration under the Securities Act of 1933, as amended (the "Act"), of, among
other securities, trust preferred securities (the "Trust Preferred Securities")
of each Trust.
This opinion is being delivered in accordance with the requirements of
Item 601(b)(5) of Regulation S-K under the Act.
The Trust Preferred Securities of each Trust are to be issued pursuant
to an Amended and Restated Declaration of Trust of each Trust (the
"Declaration"), among the Company, as Sponsor and as the issuer of certain
debentures to be held by the Property Trustee (as
<PAGE>
defined below), The Bank of New York, as Property Trustee (the "Property
Trustee"), The Bank of New York (Delaware), as Delaware trustee, and Robert C.
McPhillips, Roger Becker and Virginia A. Lane, as regular trustees. The Trust
Preferred Securities will be guaranteed by the Company with respect to
distributions and payments upon liquidation and redemption pursuant to and to
the extent set forth in a Trust Preferred Securities Guarantee Agreement,
between the Company, as guarantor, and The Bank of New York, as guarantee
trustee, for the benefit of the holders of the Trust Preferred Securities.
In connection with this opinion, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of (i) the Registration
Statement on Form S-3 (File No. 333-62661) filed by the Company and each Trust
with the Securities and Exchange Commission (the "Commission") on September 1,
1998, which was declared effective by the Commission on September 10, 1998, and
Post-Effective Amendment No. 1 thereto filed by the Company and each Trust on
September 15, 1998; (ii) the Certificate of Trust of each Trust filed with the
Secretary of State of the State of Delaware on August 28, 1998; (iii) the
Declaration of Trust of each Trust, among the Company and the trustees named
therein, each filed as an exhibit to the Registration Statement; (iv) the form
of the Declaration of each Trust, each filed as an exhibit to the Registration
Statement, (v) the form of the Trust Preferred Securities, and (vi) the
Underwriting Agreement, dated September 17, 1998, by and among the Company,
Trust III and Morgan Stanley & Co. Incorporated, as manager acting on behalf of
the underwriters named in Schedule 1 therein. We have also reviewed or discussed
with you such other documents, certificates and records as we have deemed
necessary or appropriate as a basis for the opinions set forth herein.
In our examination, we have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted
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to us as certified or photostatic copies and the authenticity of the originals
of such copies. In making our examination of documents executed by parties other
than each Trust, we have assumed that such parties had the power, corporate or
other, to enter into and perform all obligations thereunder and have also
assumed the due authorization by all requisite action, corporate or other, and
execution and delivery by such parties of such documents and that such documents
constitute or will constitute valid and binding obligations of such parties. As
to any facts material to the opinions expressed herein which were not
independently established or verified, we have relied upon oral or written
statements and representations of officers, trustees and other representatives
of each Trust, the Company and others.
We do not express any opinion as to the laws of any
jurisdiction other than the Business Trust Act of the State of Delaware.
Based on and subject to the foregoing and to the other assumptions,
qualifications and limitations set forth herein, we are of the opinion that the
Trust Preferred Securities have been duly authorized for issuance and have been
validly issued and are fully paid and nonassessable, representing undivided
beneficial ownership interests in each Trust, and the holders of the Trust
Preferred Securities are entitled to the same limitation of personal liability
extended to stockholders of private corporations for profit organized under the
General Corporation Law of the State of Delaware. We bring to your attention,
however, that the holders of the Trust Preferred Securities may be obligated,
pursuant to the Declaration, to (i) provide indemnity and/or security in
connection with and pay taxes or governmental charges arising from transfers of
Trust Preferred Securities and (ii) provide security and indemnity in connection
with the requests of or directions to the Property Trustee of
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each Trust to exercise its rights and powers under the Declaration.
We hereby consent to the filing of this opinion with the Commission as
an Exhibit to a Current Report on Form 8-K of the Company and Trust III and
incorporated by reference as an exhibit to the Registration Statement. We also
hereby consent to the use of our name under the heading "Validity of Securities"
in the prospectus, and under the heading "Experts" in any prospectus supplement,
which forms a part of the Registration Statement. In giving this consent, we do
not thereby admit that we are within the category of persons whose consent is
required under Section 7 of the Act or the rules and regulations of the
Commission promulgated thereunder. This opinion may not be used, circulated,
quoted or otherwise referred to for any other purpose or relied upon by any
other person for any purpose without our prior written consent. This opinion is
expressed as of the date hereof unless otherwise expressly stated, and we
disclaim any undertaking to advise you of any subsequent changes in the facts
stated or assumed herein or of any subsequent changes in applicable law.
Very truly yours,
/s/ Skadden, Arps, Slate, Meagher & Flom LLP
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Exhibit 8.1
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
919 THIRD AVENUE
NEW YORK 10022-3897
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TEL: (212) 735-3000
FAX: (212) 735-2000
September 24, 1998
International Paper Company
Two Manhattanville Road
Purchase, New York 10577
International Paper Capital Trust III
c/o International Paper Company
Two Manhattanville Road
Purchase, New York 10577
Re: Registration Statement on Form S-3
Registration No. 333-62661
Ladies and Gentlemen:
We have acted as special tax counsel to International Paper Company, a
New York corporation (the "Company"), and International Paper Capital Trust III,
a Delaware business trust (the "Trust"), in connection with the above-captioned
registration statement on Form S-3 (the "Registration Statement") filed with the
Securities and Exchange Commission (the "Commission") for the purpose of
registering (i) Capital Securities representing undivided beneficial interests
in the assets of the Trust and (ii) Junior Subordinated Deferrable Interest
Debentures issued by the Company to the Trust, in connection with the sale of
the Capital Securities. All capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the Prospectus Supplement for an
offering of Capital Securities.
We hereby confirm that, although the discussion set forth under the
heading "Certain United States Federal Income Tax Consequences" in the
Prospectus Supplement does not purport to discuss all possible United States
federal income tax
<PAGE>
consequences of the purchase, ownership and disposition of Capital Securities,
in our opinion, such discussion constitutes, in all material respects, a fair
and accurate summary of the purchase, ownership and disposition of Capital
Securities, based upon current law. It is possible that contrary positions may
be taken by the Internal Revenue Service and that a court may agree with such
contrary positions.
This opinion is furnished to you solely for your benefit in connection
with the filing of the Registration Statement and, except as set forth below, is
not to be used, circulated, quoted or otherwise referred to for any other
purpose or relied upon by any other person for any purpose without our prior
written consent. We hereby consent to the use of our name under the heading
"Legal Matters" in the Prospectus Supplement and the filing of this opinion with
the Commission as Exhibit 8.1 to a Current Report on Form 8-K of the Company and
incorporated by reference as an exhibit to the Registration Statement. In
giving this consent, we do not thereby admit that we are within the category of
persons whose consent is required under Section 7 of the Securities Act of 1933,
as amended, or the rules and regulations of the Commission promulgated
thereunder. This opinion is expressed as of the date hereof unless otherwise
expressly stated and applies only to the disclosure under the heading "Certain
United States Federal Income Tax Consequences" set forth in the Prospectus
Supplement. We disclaim any undertaking to advise you of any subsequent changes
of the facts stated or assumed herein or any subsequent changes in applicable
law.
Very Truly Yours,
/s/ Skadden, Arps, Slate, Meagher & Flom LLP
