<PAGE>
As filed with the Securities and Exchange Commission on July 23, 1999
Registration Statement No. 333-
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-3
REGISTRATION STATEMENT
Under
the Securities Act of 1933
----------------
JOSTENS, INC.
(Exact name of Registrant as specified in its charter)
----------------
Minnesota 41-0343440
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
5501 Norman Center Drive,
Minneapolis, Minnesota 55437
(612) 830-3300
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
----------------
William J. George, Esq.
Vice President, General Counsel and Secretary
Jostens, Inc.
5501 Norman Center Drive
Minneapolis, MN 55437
(612) 830-3300
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
----------------
Copies to:
Elizabeth C. Hinck, Esq. Bruce A. Machmeier, Esq.
Dorsey & Whitney LLP Oppenheimer Wolff & Donnelly LLP
Pillsbury Center South 3400 Plaza VII Building
220 South Sixth Street 45 South 7th Street
Minneapolis, MN 55402 Minneapolis, MN 55402
(612) 340-2600 (612) 607-7000
----------------
Approximate date of commencement of proposed sale to public: From time to
time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box: [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering: [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act of 1933, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering: [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434
under the Securities Act of 1933, please check the following box: [X]
Continued on next page
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<PAGE>
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Title of Each Proposed
Class of Maximum Proposed Maximum Amount of
Securities to Amount to be Offering Price Aggregate Registration
be Registered Registered Per Unit(1) Offering Price(1) Fee(5)
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt
Securities... $150,000,000(2)(3) 100%(4) $150,000,000 $41,700
</TABLE>
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(1) Estimated solely for the purposes of computing the registration fee
pursuant to Rule 457 of the Securities Act of 1933.
(2) Such amount shall be increased if any series of Debt Securities is issued
with original issue discount by an amount such that the net proceeds to be
received by the Registrant shall be equal to $150,000,000.
(3) In U.S. dollars or equivalent thereof in foreign or composite currencies.
(4) Plus accrued interest, if any.
(5) The prospectus included in this Registration Statement also relates to
$50,000,000 of Debt Securities previously registered pursuant to
Registration Statement No. 33-40233 (the "Prior Registration Statement"). A
registration fee of $25,000 was paid in connection with the Prior
Registration Statement, of which $12,500 related to such Debt Securities.
Pursuant to Rule 429 under the Securities Act of 1933, the prospectus
included in this Registration Statement, which is a new Registration Statement,
is a combined prospectus. This Registration Statement also constitutes Post-
Effective Amendment No. 1 to the Prior Registration Statement. The amount of
Debt Securities eligible to be sold under the Prior Registration Statement
($50,000,000) shall be carried forward to this Registration Statement. Such
Post-Effective Amendment No. 1 shall thereafter become effective concurrently
with the effectiveness of this Registration Statement in accordance with
Section 8(a) of the Securities Act of 1933.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment that specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information contained in this prospectus supplement is not complete and +
+it may be changed. We may not sell these securities until the registration +
+statement filed with the Securities and Exchange Commission is effective. +
+This prospectus supplement is not an offer to sell these securities, and it +
+is not soliciting an offer to buy these securities in any state where the +
+offer is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED JULY 23, 1999
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED , 1999
U.S. $200,000,000
[JOSTENS, INC. LOGO]
5501 Norman Center Drive
Minneapolis, Minnesota 55437
(612) 830-3300
Medium-Term Notes, Series A
Due Nine Months or more from Date of Issue
-----------
Jostens, Inc. may offer from time to time up to $200,000,000 of our Medium-
Term Notes, Series A. Each note will mature on a date nine months or more from
its date of original issuance. Unless we specify otherwise in the applicable
pricing supplement to this prospectus supplement, we will pay interest on fixed
rate notes on each February 15 and August 15 and at maturity. We will pay
interest on floating rate notes on the dates specified in the applicable
pricing supplement. Notes may contain optional redemption provisions or may
obligate us to repay at the option of the holder. Generally, there will not be
a sinking fund. We will establish the specific terms of each note and describe
those terms in the pricing supplement.
-----------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
<TABLE>
<CAPTION>
Distributor's
Commissions or
Price to Public Discounts Proceeds to Company
----------------- --------------------- ---------------------------
<S> <C> <C> <C>
Per Note... 100% .125% - .750% 99.875% - 99.250%
Total...... U.S. $200,000,000 $250,000 - $1,500,000 $199,750,000 - $198,500,000
</TABLE>
-----------
We are offering the notes on a continuing basis through our agents, Credit
Suisse First Boston Corporation, Banc One Capital Markets, Inc. and J.P. Morgan
Securities Inc. Each agent has agreed to use reasonable efforts to solicit
offers to purchase the notes. We may also sell notes at or above par to any
agent, acting as principal, as set forth in the table above. The notes will not
be listed on any securities exchange. The notes offered by this prospectus
supplement might not be sold. There might not be a secondary market for the
notes.
Credit Suisse First Boston
Banc One Capital Markets, Inc.
J.P. Morgan & Co.
Prospectus Supplement dated , 1999.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
Prospectus Supplement ----
<S> <C>
About this Prospectus Supplement; Pricing Supplements...................... S-3
Description of the Notes................................................... S-3
Special Provisions Relating to Foreign Currency Notes...................... S-11
United States Federal Income Tax Consequences.............................. S-13
Plan of Distribution....................................................... S-22
Legal Opinions............................................................. S-23
Glossary................................................................... S-24
<CAPTION>
Prospectus
<S> <C>
Summary.................................................................... 2
Risk Factors............................................................... 2
Ratio of Earnings to Fixed Charges......................................... 4
Use of Proceeds............................................................ 4
Description of Debt Securities............................................. 4
Plan of Distribution....................................................... 12
Legal Matters.............................................................. 13
Experts.................................................................... 13
Where You Can Find More Information About Jostens.......................... 13
</TABLE>
----------------
You should rely only on the information incorporated by reference or
provided in this prospectus supplement, the attached prospectus and the
attached pricing supplement. No one is authorized to provide you with different
information. We are not making an offer of these securities in any state where
an offer is not permitted. You should not assume that the information in this
prospectus supplement, the attached prospectus or the attached pricing
supplement is accurate as of any date other than the date on the front of the
applicable document.
<PAGE>
ABOUT THIS PROSPECTUS SUPPLEMENT; PRICING SUPPLEMENTS
We may use this prospectus supplement, together with the attached prospectus
and a pricing supplement, to offer our senior Medium-Term Notes, Series A, at
various times. The total initial public offering price of notes that may be
offered by use of this prospectus supplement is $200,000,000 or its equivalent
in foreign or composite currencies.
This prospectus supplement sets forth certain terms of the notes that we may
offer. It supplements the description of the debt securities contained in the
attached prospectus. If information in this prospectus supplement is
inconsistent with the prospectus, this prospectus supplement will apply and
will supersede that information in the prospectus.
Each time we issue notes we will deliver a pricing supplement to this
prospectus supplement. The pricing supplement will describe the notes being
offered and the terms of the offering. The pricing supplement may also add,
update or change information in this prospectus supplement or the attached
prospectus. Any information in the applicable pricing supplement, including any
changes in the method of calculating interest on any note, that is inconsistent
with this prospectus supplement will apply and will supersede that information
in this prospectus supplement.
It is important for you to read and consider all information contained in
this prospectus supplement and the attached prospectus and the applicable
pricing supplement in making your investment decision. You should also read and
consider the information in the documents we have referred you to in "Where You
Can Find More Information About Jostens" on page 14 of the attached prospectus.
DESCRIPTION OF THE NOTES
General
The following summary of certain terms of the notes is not complete. You
should refer to the indenture with Norwest Bank Minnesota, N.A., as trustee,
under which the notes will be issued. A copy of the indenture is incorporated
as exhibit 4.1 to our registration statement filed with the Securities and
Exchange Commission (File No. 333- ) covering the notes. Certain terms
used in this prospectus supplement are defined in the glossary beginning on
page S-24. A number of terms used but not defined in this prospectus supplement
have the same meanings as in the indenture.
The notes will constitute one series of debt securities issued under the
indenture. They will have the same rank as all of our other senior securities.
See "Description of Debt Securities" in the attached prospectus for a
description of the general terms of the debt securities.
We will offer the notes on a continuing basis. Each note will mature nine
months or more from its date of issue, as agreed between us and the initial
purchaser.
We will not redeem any note prior to the redemption date fixed at the time
of sale and set forth in the applicable pricing supplement. If the pricing
supplement does not indicate a redemption date for a note, we will not redeem
the note before its stated maturity. Unless the applicable pricing supplement
indicates otherwise, on or after any indicated redemption date, we may, at our
option, redeem the related note wholly or partially in increments of $1,000. If
we choose to redeem the note, we will do so at a redemption price equal to the
entire principal amount to be redeemed, together with interest payable to the
date of redemption. We must give notice of this redemption not more than 60 nor
less than 30 days prior to the redemption date. The notes will not have a
sinking fund unless the applicable pricing supplement specifies otherwise.
We may provide that any note will be repayable at the holder's option, at
the times and on the terms and conditions set forth in the note and described
in the applicable pricing supplement.
S-3
<PAGE>
The notes may bear interest at a fixed rate or a floating rate. Interest on
floating rate notes will be determined, and adjusted periodically, using an
interest rate basis or quotation, adjusted by any spread or spread multiplier.
See "Interest and Interest Rates" below for a discussion of the interest rates.
Unless the applicable pricing supplement specifies otherwise, the notes will
be denominated in U.S. dollars and payments of principal and interest on the
notes will be made in U.S. dollars. If denominated in U.S. dollars, the notes
will be issued in denominations of $1,000 and multiples of $1,000 greater than
$1,000. The applicable pricing supplement will set forth the authorized
denominations of notes not denominated in U.S. dollars. The pricing supplement
will also state any exchange rate information and whether the note's principal,
premium, if any, and interest may be payable at the holder's or our option in a
denomination different from that of the note. See "Special Provisions Relating
to Foreign Currency Notes" below for a more detailed discussion.
Each note will be issued in fully registered form without coupons. Each note
will be issued either in definitive form as a certificate or in global form. If
the note is issued in global form, it will be deposited in book-entry form with
or on behalf of DTC, as depositary, as described in the attached prospectus
under the caption "Description of Debt Securities--Global Securities." Unless
the applicable pricing supplement specifies otherwise, each note will be issued
in book-entry form. Beneficial interests in a book-entry note will be shown on
records maintained by DTC or its participants. Transfers of the beneficial
interests can only be effected through those records. Holders may not exchange
book-entry notes for certificated notes and book-entry notes will not generally
be issuable in definitive form. The attached prospectus describes the
exceptions to this. We will make payments of principal, any premium and
interest on book-entry notes to DTC or its nominee. DTC and its participants
will make payments to beneficial owners of interests in book-entry notes. A
further description of DTC's global securities procedures is set forth in the
attached prospectus under "Description of Debt Securities--Global Securities."
DTC has confirmed to the agents, the trustee and us that it intends to follow
those procedures.
You may present certificated notes for registration of transfer or exchange
at the corporate trust office of Norwest Bank Minnesota, N.A. in Minneapolis,
Minnesota. Unless the applicable pricing supplement indicates otherwise, we
will make payments of principal, premium, if any, and interest on certificated
notes in immediately available funds at the paying agent's office in
Minneapolis, Minnesota, or another office or agency we may choose. However, we
will make payments in these funds only if the certificated notes are presented
to the paying agent in time for the paying agent to make the payments through
normal procedures. At our option, we may pay interest on the certificated notes
by check to the person in whose name a certificated note is registered at the
close of business on the applicable regular record date before each interest
payment date. This option does not apply for interest payable at maturity.
However, some holders will be entitled to receive the payments by wire transfer
of immediately available funds to an account maintained by that holder with a
bank located in the U.S. These holders include any holders of $10,000,000 or
more in aggregate principal amount of notes denominated and payable in U.S.
dollars with the same interest payment date. To take this option, these holders
must provide appropriate payment instructions in writing to the trustee on or
before the relevant regular record date.
The applicable pricing supplement will state who will act as paying agent
for the certificated notes.
The indenture does not contain any covenants or provisions designed to
protect the holders of the notes if we enter into a transaction that adversely
affects our debt-to-equity ratio.
Interest and Interest Rates
The applicable pricing supplement will designate whether a particular note
is a fixed rate note or a floating rate note. In the case of a floating rate
note, the applicable pricing supplement will also specify whether the note will
bear interest based on the commercial paper rate, the prime rate, LIBOR, the
Treasury rate, the federal funds rate, the CD rate, the CMT rate or on another
interest rate quotation set forth in the applicable pricing supplement. In
addition, a floating rate note may bear interest at the lowest, highest or
average of two or more interest rate quotations.
S-4
<PAGE>
We will select an interest rate or interest rate quotations for each issue
of notes based on market conditions at the time of issuance. In doing so, we
will take into account, among other things, expectations concerning the level
of interest rates that will prevail during the period the notes will be
outstanding, the relative attractiveness of the interest rate or interest rate
quotation to prospective investors and our financial needs. The applicable
pricing supplement will state who will act as calculation agent with respect to
any floating rate notes.
We may change the interest rates, or interest rate quotations at various
times. No such change will affect any note already issued or for which we have
accepted an offer to purchase.
The rate of interest on floating rate notes will reset daily, weekly,
monthly, quarterly, semi-annually or annually. The interest reset dates will be
specified in the applicable pricing supplement and on the face of each note. In
addition, the pricing supplement will specify any spread, spread multiplier,
maximum interest rate or minimum interest rate that applies for a floating rate
note. The pricing supplement relating to an offering of notes may also specify,
where applicable, the calculation dates, index maturity, initial interest rate,
interest determination dates, interest payment dates, interest reset dates and
regular record dates with respect to each note. See "Glossary" on page S-24 for
definitions of the above terms. The interest rate on the notes will in no event
be higher than the maximum rate permitted by applicable law. Under New York law
in effect on the date of this prospectus supplement, the maximum annual
interest rate on a simple interest basis for loans to corporate borrowers is
25%. This limit may not apply to holders of the notes.
Each interest bearing note will accrue interest from and including the date
of issue or the most recent interest payment date for which interest has been
paid or provided. The notes will bear interest until the principal is paid or
made available for payment. We will make any interest payments in the amount of
interest accrued in the manner described up to but excluding the applicable
interest payment date.
We will pay any interest at each interest payment date and at maturity. We
will pay interest to the person in whose name a note is registered at the close
of business on the regular record date preceding the interest payment date.
However, we will pay interest at maturity to the person to whom principal is
payable. For book-entry notes, this person will be the depositary for both
kinds of payments. Interest on a note will be payable on the first interest
payment date following its date of issue. However, if the date of a note's
issue is on or after the regular record date for that interest payment date,
interest will be payable beginning on the second interest payment date
following the note's issue. See "Description of Debt Securities--Payment and
Paying Agents" in the prospectus for a discussion of the procedures for payment
of principal, premium (if any) and interest.
Fixed Rate Notes
The applicable pricing supplement relating to a fixed rate note will
designate a fixed annual interest rate payable on the fixed rate note. Unless
the applicable pricing supplement indicates otherwise, the interest payment
dates for the fixed rate notes will be February 15 and August 15 of each year
and at maturity. The regular record dates for the fixed rate notes will be the
February 1 and August 1 preceding the February 15 and August 15 interest
payment dates. Unless the applicable pricing supplement indicates otherwise,
interest on fixed rate notes will be computed on the basis of a 360-day year of
twelve 30-day months.
Floating Rate Notes
Upon the request of a registered holder of a floating rate note, the
calculation agent will provide the interest rate then in effect. The
calculation agent will also provide any new interest rate that will become
effective as a result of a determination the calculation agent has made on the
most recent interest determination date with respect to that floating rate
note.
S-5
<PAGE>
The calculation agent will calculate accrued interest on a floating rate
note by multiplying the principal amount of the note by an accrued interest
factor. The calculation agent will compute the accrued interest factor by
adding the interest factors calculated for each day in the accrual period.
Unless the applicable pricing supplement specifies otherwise, the calculation
agent will compute the interest factor for each day by dividing the interest
rate for that day by (a) the actual number of days in the year, in the case of
treasury rate notes or (b) 360, in the case of all other floating rate notes.
The interest rate on a floating rate note in effect on any day will be (a)
if the day is an interest reset date, the interest rate with respect to the
interest determination date for that interest reset date, or (b) if the day is
not an interest reset date, the interest rate with respect to the interest
determination date for the preceding interest reset date. However, the interest
rate on a floating rate note from its issue date up to but not including the
first interest reset date for the note will be the initial interest rate set
forth in the applicable pricing supplement. The interest rate is subject to
adjustment by any spread or a spread multiplier and to any maximum interest
rate or minimum interest rate limitation. However, the interest rate for the
ten calendar days prior to the date of maturity will be the one in effect on
the tenth calendar day before maturity.
All percentages resulting from any calculation of floating rate notes will
be rounded to the nearest one-hundred thousandth of a percentage point, with
five one-millionths of a percentage point rounded upwards (e.g., 9.876545%, or
.09876545, being rounded to 9.87655%, or .0987655, and 9.876544%, or .09876544,
being rounded to 9.87654%, or .0987654), and all dollar amounts used in or
resulting from this calculation will be rounded to the nearest cent, with one-
half cent being rounded upwards.
Commercial Paper Rate Notes. Commercial paper rate notes will bear interest
at the interest rates, calculated with reference to the commercial paper rate
and any spread or spread multiplier, specified on the face of the commercial
paper rate note and in the applicable pricing supplement.
Unless the applicable pricing supplement indicates otherwise, the
"commercial paper rate" for any commercial paper interest determination date is
the money market yield of the rate on that date for commercial paper having the
index maturity specified in the pricing supplement as published in H.15(519)
prior to 3:00 P.M., New York City time, on the calculation date relating to
that commercial paper interest determination date under the heading "Commercial
Paper--Nonfinancial."
The following procedures will be followed if the commercial paper rate
cannot be determined as described above:
. If the above rate is not published in H.15(519) by 3:00 P.M., New York
City time, on the calculation date, the commercial paper rate will be
the money market yield of the rate on that commercial paper rate
interest determination date for commercial paper having the index
maturity designated in the pricing supplement, as published in H.15
Daily Update under the heading "Commercial Paper--Nonfinancial."
. If that rate is not published in H.15 Daily Update by 3:00 P.M., New
York City time, on the calculation date, then the calculation agent will
determine the commercial paper rate to be the money market yield of the
average of certain offered rates of three leading dealers of commercial
paper in New York City as of 11:00 A.M., New York City time, on that
commercial paper rate interest determination date. These offered rates
will be for commercial paper having the index maturity specified in the
pricing supplement for a non-financial issuer whose bond rating is "Aa",
or the equivalent, from a nationally recognized rating agency. The
calculation agent will select the three dealers referred to above, which
may include the agents or their affiliates.
. If fewer than three dealers selected by the calculation agent are
quoting as mentioned above, the commercial paper rate will be the
commercial paper rate in effect on that commercial paper rate interest
determination date.
S-6
<PAGE>
CMT Rate Notes. CMT rate notes will bear interest at the interest rates,
calculated with reference to the CMT rate and any spread or spread multiplier,
specified on the face of the CMT rate notes and in the applicable pricing
supplement.
Unless the applicable pricing supplement indicates otherwise, the "CMT rate"
for any CMT interest determination date is the rate displayed on the designated
CMT Telerate page under the caption ". . . Treasury Constant Maturities . . .
Federal Reserve Board Release H.15", under the column for the designated CMT
maturity index for
. the rate on such CMT rate interest determination date, if the designated
CMT Telerate page is 7051; and
. the week or the month, as applicable, ended immediately preceding the
week in which the related CMT rate interest determination date occurs,
if the designated CMT Telerate page is 7052.
The following procedures will be followed if the CMT rate cannot be
determined as described above:
. If such rate is no longer displayed or is not displayed by 3:00 p.m.,
New York City time, on the related calculation date, then the CMT rate
for the CMT interest determination date will be the Treasury constant
maturity rate for the designated CMT maturity index, as published in the
relevant H.15(519).
. If such rate is no longer published or is not published by 3:00 p.m.,
New York City time, on the related calculation date, the CMT rate for
the CMT interest determination date will be the Treasury constant
maturity rate for the designated CMT maturity index, or other U.S.
Treasury rate for the designated CMT maturity index, for the CMT
interest determination date with respect to the interest reset date as
may then be published by either the board of governors of the federal
reserve system or the U.S. Department of the Treasury that the
calculation agent determines to be comparable to the rate formerly
displayed on the designated CMT Telerate page and published in the
relevant H.15(519).
. If such information is not provided by 3:00 p.m., New York City time, on
the related calculation date, then the CMT rate for the CMT interest
determination date will be calculated by the calculation agent and will
be a yield to maturity, of certain offered rates at approximately 3:30
p.m., New York City time, on the CMT interest determination date
reported, according to their written records, by three leading primary
U.S. government securities dealers in the City of New York. The offered
rates will be for the most recently issued Treasury notes with an
original maturity of approximately the designated CMT maturity index and
a remaining term to maturity of not less the designated CMT maturity
index minus one year. The calculation agent will select the three
dealers referred to above, which may include the agents or their
affiliates.
. If the calculation agent cannot obtain three quotations referred to
above, the calculation agent will calculate the CMT rate as a yield to
maturity of certain offered rates at approximately 3:30 p.m., New York
City time, of three dealers in the City of New York. The offered rates
will be for the most recently issued Treasury Notes with an original
maturity closest to the designated CMT maturity index and in an amount
of at least $100 million.
. If there are fewer than three dealers available in the City of New York,
referred to above, the CMT rate will be the CMT rate in effect on the
CMT interest determination date. If two Treasury notes with an original
maturity as referred to above have remaining terms to maturity equally
close to the designated CMT maturity index, the quotes for the Treasury
note with the shorter remaining term to maturity will be used.
S-7
<PAGE>
Prime Rate Notes. A prime rate note will bear interest at the interest rate,
calculated with reference to the prime rate plus or minus any spread or spread
multiplier, specified on the face of the prime rate note and in the applicable
pricing supplement. Unless the applicable pricing supplement indicates
otherwise, the "prime rate" for any prime rate interest determination date is
the prime rate on that date, as published in H.15(519) by 3:00 P.M., New York
City time, on the calculation date relating to that prime rate interest
determination date under the heading "Bank Prime Loan."
The following procedures will be followed if the prime rate cannot be
determined as described above:
. If the above rate is not published in H.15(519) by 3:00 P.M., New York
City time, on the calculation date, then the prime rate will be the rate
on that prime rate interest determination date as published in H.15
Daily Update opposite the caption "Bank Prime Loan."
. If that rate is not published in H.15 Daily Update by 3:00 P.M., New
York City time, on the calculation date, then the calculation agent will
determine the prime rate to be the average of certain interest rates
publicly announced by each bank that appears on the Reuters Screen
USPRIME1 Page. For each bank, those announced rates will be that bank's
prime rate or base lending rate in effect for that prime rate interest
determination date at 11:00 A.M. New York City time.
. If fewer than four of those rates appear on the Reuters Screen USPRIME1
Page for that prime rate interest determination date, then the prime
rate will be the average of the announced prime rates quoted (on the
basis of the actual number of days in the year divided by 360) by at
least two major money center banks in New York City as of the close of
business on that prime rate interest determination date. The calculation
agent will select the banks referred to above, which may include the
agents or their affiliates.
. If fewer than two quotations are provided as mentioned in the previous
item, the prime rate will be determined on the basis of the rates
furnished in New York City by the appropriate number of substitute banks
or trust companies organized and doing business under the laws of the
United States, or any state. These substitute banks must have total
equity capital of at least $500 million and subject to supervision or
examination by federal or state authority. The calculation agent will
select the banks or trust companies referred to above.
. If the banks or trust companies described in the previous item are not
quoting as mentioned above, the prime rate will be the prime rate in
effect on that prime rate interest determination date.
LIBOR Notes. A LIBOR note will bear interest at the interest rate
(calculated with reference to LIBOR and any spread or spread multiplier)
specified on the face of the LIBOR note and in the applicable pricing
supplement.
Unless the applicable pricing supplement indicates otherwise, the
calculation agent will determine LIBOR as follows:
On each LIBOR rate interest determination date:
. If "LIBOR Reuters" is specified in the applicable pricing supplement,
LIBOR will be the average of certain offered rates for deposits in the
index currency having the index maturity specified in the pricing
supplement beginning on the applicable interest reset date. Those rates
will be the ones which appear on the designated LIBOR page as of 11:00
A.M., London time, on that LIBOR rate interest determination date, if at
least two of those offered rates appear on the designated LIBOR page. If
the designated LIBOR page provides only for a single rate, that single
rate will be used regardless of the foregoing provisions requiring more
than one rate.
S-8
<PAGE>
. If "LIBOR Telerate" is specified in the applicable pricing supplement,
LIBOR will be a certain rate for deposits in the index currency having
the index maturity specified in the pricing supplement beginning on that
interest reset date. That rate will be the one which appears on the
designated LIBOR page as of 11:00 A.M., London time, on that LIBOR rate
interest determination date.
. If neither "LIBOR Reuters" nor "LIBOR Telerate" is specified in the
applicable pricing supplement as the method for calculating LIBOR, LIBOR
will be calculated as if "LIBOR Telerate" had been specified.
On any LIBOR rate interest determination date on which fewer than two of
those offered rates appear or no rate appears, as applicable, on the
designated LIBOR page, the calculation agent will determine LIBOR as follows:
. LIBOR will be determined on the basis of the offered rates at which
deposits in the index currency having the index maturity specified in
the applicable pricing supplement beginning on the applicable interest
reset date and in a principal amount that is representative for a single
transaction in that index currency in that market at that time by four
major banks in the London interbank market (which may include the agents
or their affiliates) at approximately 11:00 A.M., London time, on that
LIBOR rate interest determination date to prime banks in the London
interbank market. The calculation agent will select the four banks and
request the principal London office of each of those banks to provide a
quotation of its rate. If at least two quotations are provided, LIBOR on
that LIBOR rate interest determination date will be the average of those
quotations.
. If fewer than two of those quotations are provided as mentioned above,
LIBOR on that LIBOR rate interest determination date will be the average
of the rates quoted at approximately 11:00 A.M., in the applicable
principal financial center, on that LIBOR rate interest determination
date by three major banks in that principal financial center (which may
include the agents or their affiliates) for loans in the index currency
to leading European banks, having the index maturity specified in the
applicable pricing supplement and in a principal amount representative
for a single transaction in that index currency in that market at that
time. The calculation agent will select the three banks referred to
above.
. If the banks selected by the calculation agent are not quoting as
mentioned above, LIBOR will be LIBOR in effect on the LIBOR rate
interest determination date.
Treasury Rate Notes. A Treasury rate note will bear interest at the
interest rate (calculated with reference to the Treasury rate and any spread
or spread multiplier) specified on the face of the Treasury rate note and in
the applicable pricing supplement.
Unless the applicable pricing supplement indicates otherwise, "Treasury
rate" for any Treasury rate interest determination date means a certain rate
from the most recent Treasury bill auction having the index maturity specified
in the pricing supplement. That rate will be the one that appears on page 56
or page 57 on the Telerate Service under the heading "AVGE INVEST YIELD."
The following procedures will be followed if the Treasury rate cannot be
determined as described above:
. If the above rate is not displayed on the relevant page by 3:00 P.M.,
New York City time, on the calculation date, the Treasury rate will be
the auction average rate for that auction as otherwise announced by the
United States Department of the Treasury. The auction average rate will
be expressed as a bond equivalent on the basis of a year of 365 or 366
days, as applicable, and applied on a daily basis.
. If the results of the auction of Treasury bills having the index
maturity specified in the pricing supplement are not published or
reported as provided above by 3:00 P.M., New York City time, on the
calculation date, or if no auction is held in a particular week, then
the Treasury rate will be the rate as published in H.15(519) under the
heading "U.S. Government Securities/Treasury Bills/Secondary Market."
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. If the rate described in the previous item is not published by 3:00
P.M., New York City time, on the calculation date, then the calculation
agent will determine the Treasury rate to be a yield to maturity of the
average of certain secondary market bid rates, as of approximately 3:30
P.M., New York City time, on that Treasury rate interest determination
date. The bid rates will be those of three leading primary U.S.
government securities dealers in New York City for the issue of Treasury
bills with a remaining maturity closest to the index maturity specified
in the pricing supplement. The rates will be expressed as a bond
equivalent on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis. The calculation agent will select the three
dealers referred to above, which may include the agents or their
affiliates.
. If fewer than three dealers selected by the calculation agent are
quoting as mentioned above, the Treasury rate will be the Treasury rate
in effect on that Treasury rate interest determination date.
Federal Funds Rate Notes. A federal funds rate note will bear interest at
the interest rate calculated with reference to the federal funds rate and any
spread or spread multiplier, as specified on the face of the federal funds rate
note and in the applicable pricing supplement.
Unless the applicable pricing supplement indicates otherwise, the "federal
funds rate" for any federal funds rate interest determination date is the rate
on that day for federal funds as published in H.15(519) prior to 3:00 P.M., New
York City time, on the calculation date relating to that federal funds rate
interest determination date under the heading "Federal Funds (Effective)."
The following procedures will be followed if the federal funds rate cannot
be determined as described above:
. If the above rate is not published in H.15(519) by 3:00 P.M., New York
City time, on the calculation date, the federal funds rate will be the
rate on that federal funds rate interest determination date for U.S.
dollar federal funds, as published in H.15 Daily Update under the
heading "Federal Funds (Effective)."
. If that rate is not published in H.15 Daily Update by 3:00 P.M., New
York City time, on the calculation date, then the calculation agent will
determine the federal funds rate to be the average of certain rates for
the last transaction in overnight federal funds as of 9:00 A.M., New
York City time, on that federal funds rate interest determination date.
The rates will be ones arranged by three leading brokers of federal
funds transactions in New York City. The calculation agent will select
the three brokers referred to above.
. If fewer than three brokers selected by the calculation agent are
quoting as mentioned above, the federal funds rate will be the federal
funds rate in effect on that federal funds rate interest determination
date.
CD Rate Notes. A CD rate note will bear interest at the interest rate
(calculated with reference to the CD rate and any spread or spread multiplier)
specified in the CD rate note and in the applicable pricing supplement.
Unless the applicable pricing supplement indicates otherwise, the "CD rate"
for any CD rate interest determination date is the rate on that date for
negotiable certificates of deposit having the index maturity specified in the
pricing supplement, as published in H.15(519) prior to 3:00 P.M., New York City
time, on the calculation date relating to that CD rate interest determination
date under the heading "CDs (Secondary Market)."
The following procedures will be followed if the CD rate cannot be
determined as described above:
. If the above rate is not published by 3:00 P.M., New York City time, on
the calculation date, the CD rate will be the rate on that CD rate
interest determination date for negotiable certificates of deposit of
the index maturity specified in the pricing supplement as published in
H.15 Daily Update under the caption "CDs (Secondary Market)."
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. If that rate is not published in H.15 Daily Update by 3:00 P.M., New
York City time, on the calculation date, then the calculation agent will
determine the CD rate to be the average of certain secondary market
offered rates as of 10:00 A.M., New York City time, on that CD rate
interest determination date. The offered rates will be ones quoted by
three leading nonbank dealers in negotiable U.S. dollar certificates of
deposit in New York City. The dealers will provide quoted rates for
negotiable certificates of deposit in a denomination of $5,000,000 of
major U.S. money market banks of the highest credit standing (in the
market for negotiable certificates of deposit) with a remaining maturity
closest to the index maturity designated in the applicable pricing
supplement. The calculation agent will select the three dealers referred
to above.
. If fewer than three dealers are quoting as mentioned above, the CD rate
will be the CD rate in effect on that CD rate interest determination
date.
Indexed Notes
We may issue notes as indexed notes, as indicated in the applicable pricing
supplement. Holders of indexed notes may receive a principal amount at maturity
that is greater than or less than the face amount of the notes depending upon
the fluctuation of the relative value, rate or price of the specified index.
The applicable pricing supplement will describe specific information relating
to the method for determining the principal amount payable at maturity, a
historical comparison of the relative value, rate or price of the specified
index and the face amount of the indexed note and certain additional tax
considerations.
Original Issue Discount Notes
We may issue notes as original issue discount notes, as indicated in the
applicable pricing supplement, and no interest will be payable prior to the
maturity of such notes. An original issue discount note is issued at a price
lower than the principal amount of that note. If there is a redemption or
acceleration of the maturity of an original issue discount note, the amount
payable to the holder of the note will be determined under the terms of the
note, but will be less than the amount payable at the maturity of the note. In
addition, a note issued at a discount may, for U.S. federal income tax
purposes, be considered an original issue discount note, regardless of the
amount payable upon redemption or acceleration of maturity of that note. See
"United States Taxation--Original Issue Discount" for a discussion of the
income tax provisions.
Other Provisions; Addenda
Any provisions relating to any note may be modified as specified under
"Other Provisions" on the face of that note or in an addendum relating to that
note. These provisions might include the determination of an interest rate
basis, the calculation of the interest rate applicable to a floating rate note,
and the specification of one or more interest rate bases, the interest payment
dates, the maturity or any other variable term relating to that note.
SPECIAL PROVISIONS RELATING TO FOREIGN CURRENCY NOTES
General
Unless the applicable pricing supplement indicates otherwise, the notes will
be denominated in U.S. dollars and we will make payments of principal of and
interest on the notes in U.S. dollars. If we designate any of the notes to be
denominated in a currency or currency unit other than U.S. dollars, which may
include Canadian dollars, the following provisions will apply. These provisions
are in addition to and, where inconsistent, replace the description of general
terms and provisions of notes set forth in the attached prospectus and
elsewhere in this prospectus supplement. We refer below to any currency or
currency unit designated in this manner as the "specified currency."
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Notes not denominated in U.S. dollars are issuable in registered form only,
without coupons. The pricing supplement will specify the denominations for
particular foreign currency notes.
Unless the applicable pricing supplement provides otherwise, you are
required to pay the purchase price of foreign currency notes in immediately
available funds.
Notes denominated in specified currencies other than euro will not be sold
in, or to residents of, the country of the specified currency in which
particular notes are denominated unless the pricing supplement specifies
otherwise.
Currencies
Unless the applicable pricing supplement specifies otherwise, you are
required to pay for foreign currency notes in the specified currency. At the
present time there are limited facilities in the United States for the
conversion of U.S. dollars into the specified currencies and vice versa, and
banks do not generally offer non-U.S. dollar checking or savings accounts in
the United States. However, you may ask the agent who presented your offer to
purchase foreign currency notes to us to use its reasonable best efforts to
arrange for the exchange of U.S. dollars into the relevant specified currency
to enable you to pay for the notes. You must make this request on or before the
third business day preceding the delivery date for the note or by a later date
if allowed by the agent. Each exchange will be made on the terms and conditions
established by the agent in accordance with its regular foreign exchange
practices and you will pay for all related costs.
The applicable pricing supplement will contain specific information about
the foreign currency or composite currency in which a particular foreign
currency note is denominated, including historical exchange rates and a
description of the currency and any exchange controls.
Payment of Principal and Interest
We will pay the principal of and interest on foreign currency notes in U.S.
dollars. However, unless the applicable pricing supplement specifies otherwise,
the holder of a foreign currency note may elect to receive the payments in the
specified currency as described below. The exchange rate agent will determine
the rate of conversion for all payments of principal of and interest on foreign
currency notes to U.S. dollars. "Exchange rate agent" means the agent appointed
by us to make those determinations. Unless the pricing supplement specifies
otherwise, the exchange rate agent will be Norwest Bank Minnesota, N.A.
Unless the applicable pricing supplement specifies otherwise, any U.S.
dollar amount to be received by a holder of a foreign currency note will be
based on the following:
. The highest bid quotation in New York City received by the exchange rate
agent at approximately 11:00 A.M., New York City time, on the second
business day preceding the applicable payment date from three recognized
foreign exchange dealers (one of which may be the exchange rate agent or
an agent) for the purchase by the quoting dealer of the specified
currency for U.S. dollars for settlement on that payment date in the
aggregate amount of the specified currency payable to all holders of
foreign currency notes scheduled to receive U.S. dollar payments and at
which the applicable dealer commits to execute a contract. The exchange
rate agent will select and we will approve that selection of the three
dealers referred to above.
. If fewer than three of these bid quotations are available, payments will
be made in the specified currency.
The holder of the foreign currency note will bear all of these currency
exchange costs through payment deductions.
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Unless the applicable pricing supplement specifies otherwise, a holder of
foreign currency notes may elect to receive payment of the principal of and
interest on the notes in the specified currency by transmitting a request for
the payment to the corporate trust department of Norwest Bank Minnesota, N.A.
in Minneapolis, Minnesota, on or before the regular record date or at least
sixteen days before maturity, as the case may be. The request must be in
writing (mailed or hand delivered) or by cable, telex or other form of
facsimile transmission. If a holder elects to receive all principal and
interest payments in the specified currency that holder need not file a
separate election for each payment. The election will remain in effect until
revoked by written notice to Norwest Bank Minnesota, N.A. in Minneapolis,
Minnesota. Written notice of any revocation of this kind must be received by
Norwest Bank Minnesota, N.A. in Minneapolis, Minnesota on or before the regular
record date or at least sixteen days before maturity, as the case may be.
Holders of foreign currency notes held in the name of a broker or nominee
should contact that broker or nominee to determine whether and how an election
to receive payments in the specified currency may be made.
We will pay interest on and principal of foreign currency notes paid in U.S.
dollars in the manner specified in the attached prospectus and elsewhere in
this prospectus supplement. Interest on foreign currency notes paid in the
specified currency will be paid by a check drawn on an account maintained at a
bank outside the U.S., unless other arrangements have been made. The principal
and interest due at maturity of foreign currency notes paid in the specified
currency will be paid in immediately available funds by wire transfer to an
account maintained with a bank outside the U.S. designated at least sixteen
days before maturity by the holders. However, those foreign currency notes must
be presented to the trustee or the paying agents designated in the applicable
pricing supplement to allow time for payment. Any payment of principal or
interest required to be made on an interest payment date or at maturity of a
foreign currency note that is not a business day may be made instead on the
following business day. In this case, no interest will accrue for the period
from and after the interest payment date or maturity.
Payment Currency
At various times, a specified currency may not be available for the payment
of principal or interest with respect to a foreign currency note due to the
imposition of exchange controls or other circumstances beyond our control. If
this is the case, we will be entitled to satisfy our obligations to holders of
foreign currency notes by making the payment in U.S. dollars on the basis of
the market exchange rate on the date of payment, or if the market exchange rate
is not available at that time, on the basis of the most recently available
market exchange rate.
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of the principal United States federal income tax
consequences resulting from the beneficial ownership of notes by certain
persons. This summary does not consider all the possible United States federal
tax consequences of the purchase, ownership or disposition of the notes and is
not intended to reflect the individual tax position of any beneficial owner. It
deals only with notes and currencies or composite currencies other than U.S.
dollars held as capital assets. Moreover, except as expressly indicated, it
addresses initial purchasers of a note at its issue price, which is the first
price to the public at which a substantial amount of the notes in an issue is
sold, and does not address beneficial owners that may be subject to special tax
rules, such as banks, insurance companies, dealers in securities or currencies,
purchasers that hold notes or foreign currency as a hedge against currency
risks or as part of a straddle with other investments or as part of a synthetic
security or other integrated investment (including a conversion transaction)
comprised of a note and one or more other investments, or purchasers that have
a functional currency other than the U.S. dollar. Except to the extent
discussed below under "Non-United States Holders", this summary is not
applicable to non-United States persons not subject to United States federal
income tax on their worldwide income. This summary is based upon the United
States federal tax laws and regulations currently in effect and as currently
interpreted and does not take into account possible changes in the tax laws or
the interpretations, any of which may be applied retroactively. It does not
discuss the tax laws of any state, local or foreign governments. It does not
discuss the tax treatment of notes denominated in certain hyperinflationary
currencies or dual currency notes.
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Persons considering the purchase of notes should consult their own tax
advisors concerning the United States federal income tax consequences to them
in light of their particular situations as well as any consequences to them
under the laws of any other taxing jurisdiction.
United States Holders
Payments of Interest
In general, interest on a note, whether payable in U.S. dollars or a foreign
currency, as well as market discount, if any, will be taxable to a beneficial
owner who or which is (i) a citizen or resident of the United States, (ii) a
corporation created or organized under the laws of the United States or any
State (including the District of Columbia) or (iii) a person otherwise subject
to United States federal income taxation on its worldwide income (a "United
States holder") as ordinary income at the time it is received or accrued,
depending on the holder's method of accounting for tax purposes. If a
partnership holds notes, the tax treatment of a partner will generally depend
upon the status of the partner and upon the activities of the partnership.
Partners of partnerships holding notes should consult their tax advisors. If an
interest payment is denominated in or determined by reference to a foreign
currency, then special rules, described below under "Foreign Currency Notes",
apply.
Original Issue Discount
The notes may be issued with original issue discount, as indicated in the
applicable pricing supplement. In general, in the hands of the original holder
of a note, original issue discount is the difference between the stated
redemption price at maturity of the note and its issue price. A note's original
issue discount will be considered to be zero if it is less than one quarter of
one percentage point of the note's stated redemption price at maturity
multiplied by the number of complete years from the date of issue of the note
to its stated maturity date. This amount is referred to in this discussion as
de minimis OID.
A note's stated redemption price at maturity generally will equal the sum of
all payments, whether principal or interest, to be made with respect to the
note other than qualified stated interest payments. Pursuant to Treasury
Regulations, qualified stated interest payments are interest payments based on
a single fixed rate of interest, or under certain circumstances, a variable
rate tied to an objective index, that is actually and unconditionally payable
at fixed periodic intervals of one year or less during the entire term of the
note. In general, the issue price of a note is the initial offering price to
the public at which a substantial amount of notes are sold, ignoring sales to
bond houses, brokers, or others acting in the capacity of underwriters,
placement agents, or wholesalers.
Under the Treasury Regulations, if a note bears interest for one or more
accrual periods at a rate below the rate applicable for the remaining term of
such note (e.g., notes with teaser rates or interest holidays), and if the
greater of either the resulting foregone interest on such note or any "true"
discount on such note (i.e., the excess of the note's stated principal amount
over its issue price) equals or exceeds a specified de minimis amount, then the
stated interest on the note would be treated as original issue discount rather
than qualified stated interest.
It is possible that notes which are not denominated as original issue
discount notes may nevertheless be treated for federal income tax purposes as
issued at an original issue discount. For example, the following types of notes
will be deemed to be discount notes unless interest on the notes is
unconditionally payable at least annually during the term of the note at a
single qualified floating rate or a single objective rate within the meaning of
the Treasury Regulations:
. floating rate notes providing for one or more qualified floating rates
of interest;
. a single fixed rate and one or more qualified floating rates;
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. a single rate based on one or more qualified floating rates or a single
rate based on the yield of actively traded personal property (an
"objective rate"); or
. a single fixed rate and a single objective rate that is a qualified
inverse floating rate.
If a floating rate note provides for two or more qualified floating rates
that can reasonably be expected to have approximately the same values
throughout the term of the note, the qualified floating rates together
constitute a single qualified floating rate. If interest on a debt instrument
is stated at a fixed rate for an initial period of one year or less followed by
a variable rate that is either a qualified floating rate or an objective rate
for a subsequent period, and the value of the variable rate on the issue date
is intended to approximate the fixed rate, the fixed rate and the variable rate
together constitute a single qualified floating rate or objective rate. Two or
more rates will be conclusively presumed to meet the requirements of the
preceding sentences if the values of the applicable rates on the issue date are
within 1/4 of 1 percent of each other.
Special tax considerations, including possible original issue discount, may
arise with respect to floating rate notes providing for:
. one interest rate formula followed by one or more interest rate
formulas;
. a single fixed rate followed by a qualified floating rate; or
. a spread multiplier.
Purchasers of floating rate notes with any of these features should
carefully examine the applicable pricing supplement and should consult their
tax advisors regarding any of these features since the tax consequences will
depend, in part, on the particular terms of the purchased note. Special rules
may apply if a floating rate note bears interest at an objective rate and it is
reasonably expected that the average value of the rate during the first half of
the note's term will be either significantly less than or significantly greater
than the average value of the rate during the final half of the note's term.
Special rules may also apply if a floating rate note is subject to a cap,
floor, governor or similar restriction that is not fixed throughout the term
and that is reasonably expected as of the issue date to cause the note yield to
be significantly less or more than the expected yield determined without the
restriction.
In the case of a note issued with de minimis OID, United States holders
generally must include the de minimis OID in income when stated principal
payments on the notes are made in proportion to the amount of principal paid.
Any amount of de minimis OID that has been included in income is treated as
capital gain.
In the case of any note issued with original issue discount for federal
income tax purposes, a United States holder must generally include the original
issue discount in ordinary income for federal income tax purposes as it
accrues. The amount of original issue discount, if any, required to be included
in a United States holder's ordinary income for federal income tax purposes in
any taxable year will be computed according to Section 1272(a) of the Internal
Revenue Code of 1986 and the Treasury Regulations. Under this Internal Revenue
Code section and the Treasury Regulations, original issue discount accrues on a
daily basis under a constant yield to maturity method that takes into account
the compounding of interest. The daily portions of original issue discount are
determined by allocating to each day in an accrual period a pro rata portion of
the original issue discount for that accrual period.
Accrual periods may be of any length and may vary in length over the term of
the notes, provided that each accrual period is not longer than one year and
each scheduled payment of principal or interest occurs either on the final day
of an accrual period or on the first day of an accrual period. Original issue
discount for any accrual period will be the excess of (a) the product of the
note's adjusted issue price at the beginning of the accrual period and its
yield to maturity over (b) any qualified stated interest payments for that
accrual period. The adjusted issue price of a note at the start of any accrual
period is the sum of the issue price and the accrued original issue discount
for each prior accrual period (determined without regard to any acquisition or
bond premium amortization, as described below), reduced by any note payments
made on such note (other than
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qualified stated interest) on or before the first day of the accrual period.
One effect of this method is that United States holders generally will have to
include in income increasingly greater amounts of original issue discount in
successive accrual periods.
In the case of a discount note that is a floating rate note, both the yield
to maturity and qualified stated interest will be determined as though the note
bears interest in all periods at a fixed rate generally equal to the rate that
would apply to interest payments on the note on its date of issue or, in the
case of certain floating rate notes, the rate that reflects the yield to
maturity that is reasonably expected for the note. Additional rules may apply
if interest on a floating rate note is based on more than one interest rate
formula. Persons considering purchasing floating rate notes should carefully
examine the applicable pricing supplement and should consult their own tax
advisors regarding the U.S. federal income tax consequences of purchasing,
owning and disposing of floating rate notes.
If a floating rate note does not qualify as a variable rate debt instrument
under the original issue discount Treasury Regulations the floating rate note
will be treated under the Treasury Regulations as a contingent payment debt
instrument. In general, the Treasury Regulations may cause the timing and
character of income, gain or loss reported on a contingent payment debt
instrument to substantially differ from the timing and character of income,
gain or loss reported on a contingent payment debt instrument under general
principles of current United States federal income tax law. Specifically, the
Treasury Regulations may require the United States holder of a contingent
payment debt instrument to include future contingent and non-contingent
interest payments in income as such interest accrues based upon a projected
payment schedule. Moreover, under the Treasury Regulations, any gain recognized
by a United States holder on the sale, exchange, or retirement of a contingent
payment debt instrument may be treated as ordinary income. All or a portion of
any loss realized may be treated as ordinary loss as opposed to capital loss
depending upon the circumstances. The proper United States federal income tax
treatment of floating rate notes that are treated as contingent payment debt
obligations will be more fully described in the applicable pricing supplement.
Under the Treasury Regulations, a holder may elect to include in gross
income all interest that accrues on a note (including stated interest,
acquisition discount, original issue discount, de minimis OID, market discount,
de minimis market discount and unstated interest, as adjusted by any
amortizable bond premium or acquisition premium) according to a constant yield
method that takes into account the compounding of interest. This election must
be made during the taxable year in which the United States holder acquires the
note, and may not be revoked without the consent of the Internal Revenue
Service. United States holders should consult with their own tax advisors about
this election.
The original issue discount provisions described above do not apply to
short-term notes having a fixed maturity date not more than one year from the
date of issue. Under the Treasury Regulations, these short-term notes will be
treated as having been issued at an original issue discount equal to the excess
of the total principal and interest payments on the note over its issue price.
An individual or other holder using the cash receipts and disbursements method
of tax accounting will not be required to include original issue discount on
the short-term note in ordinary income for federal income tax purposes on a
daily basis unless an election to do so is made. Holders of short-term notes
who report income under the accrual method of tax accounting and certain other
holders, including banks, regulated investment companies and securities dealers
are required to include original issue discount in income on a daily basis
under to a straight-line method, unless they elect to accrue original issue
discount under the constant yield method described above. In the case of
holders of short-term notes not required and not electing to include original
issue discount in income currently, any gain realized on the sale, exchange or
maturity of such short-term notes will be ordinary income to the extent of the
original issue discount accrued on a straight-line basis (or, if elected on a
constant yield method, based on daily compounding), reduced by any interest
received, to the date of sale, exchange or maturity. Holders of short-term
notes not required and not electing to include the original issue discount in
income currently will be required to defer deductions for interest on
indebtedness incurred or continued to purchase or carry such short-term notes
in an amount not exceeding the deferred income until the deferred income is
realized.
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The Treasury Regulations contain aggregation rules stating that in certain
circumstances if more than one type of note is issued as part of the same
issuance of securities to a single holder, some or all of such notes may be
treated together as a single debt instrument with a single issue price,
maturity date, yield to maturity and stated redemption price at maturity for
purposes of calculating and accruing any original issue discount. Unless
otherwise provided in the applicable pricing supplement, we do not expect to
treat any of the notes as being subject to the aggregation rules for purposes
of computing original issue discount.
Optional Redemption
Under the Treasury Regulations, if we have an option to redeem a note prior
to its stated maturity date, this option will be presumed to be exercised if,
by utilizing any date on which the note may be redeemed as the maturity date
and the amount payable on that date in accordance with the terms of the note as
the stated redemption price at maturity, the yield on the note would be lower
than its yield to stated maturity. If this option is not in fact exercised when
presumed to be exercised, the note would be treated solely for original issue
discount purposes as if it were redeemed, and a new note were issued, on the
presumed exercise date for an amount equal to the redemption price payable on
that date.
Notes Purchased at a Premium
A United States holder that purchases a note for an amount that is greater
than its adjusted issue price but equal to or less than the sum of all amounts
payable on the note after the purchase date, other than payments of qualified
stated interest, will be considered to have purchased the note at an
acquisition premium. Under the acquisition premium rules, the amount of
original issue discount that a holder must include in its gross income with
respect to the note for any taxable year will be reduced by the portion of
acquisition premium properly allocable to that year.
Under the Internal Revenue Code, a United States holder that purchases a
note for an amount in excess of its stated redemption price at maturity may
elect to treat such excess as amortizable bond premium, in which case the
amount of interest required to be included in the United States holder's income
each year with respect to interest on the note will be reduced by the amount of
amortizable bond premium allocable (based on the note's yield to maturity) to
that year. Under recently promulgated regulations, if the amortizable bond
premium allocable to a year exceeds the amount of interest allocable to that
year, the excess would be allowed as a deduction for that year but only to the
extent of the United States holder's prior interest inclusions on the note. Any
excess is generally carried forward and allocable to the next year. A holder
who elects to amortize bond premium must reduce his tax basis in the note as
described below under "Purchase, Sale, Exchange and Retirement of the Notes."
Any election to amortize bond premium applies to all taxable debt obligations
held by the United States holder at the beginning of the first taxable year to
which the election applies or thereafter acquired by the United States holder,
and may be revoked only with the consent of the Internal Revenue Service.
Notes Purchased at a Market Discount
A note (other than a short term note with a fixed maturity date not more
than one year from the issue date) will be treated as issued at a market
discount if the amount for which a United States holder purchased the note is
less than the note's original issue price plus accrued original issue discount,
unless such difference is less than a specified de minimis amount. These market
discount rules apply regardless of whether the note is issued with original
issue discount.
In general, any partial payment of principal or any gain recognized on the
maturity or disposition of a market discount note will be treated as ordinary
income to the extent that such gain does not exceed the accrued market discount
on such note. Alternatively, a United States holder of a market discount note
may elect to include market discount in income currently over the life of the
market discount note. That election applies to all debt instruments with market
discount acquired by the electing United States holder on or after the first
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day of the first taxable year to which the election applies and may not be
revoked without the consent of the Internal Revenue Service.
Market discount accrues on a straight-line basis unless the United States
holder elects to accrue it on a constant yield to maturity basis. That election
is applicable only to the market discount note with respect to which it is made
and is irrevocable. A United States holder of a market discount note that does
not elect to include market discount in income currently generally will be
required to defer deductions for interest on borrowings allocable to the note
in an amount not exceeding the accrued market discount on such note until the
maturity or disposition of the note.
Purchase, Sale, Exchange and Retirement of the Notes
A United States holder's tax basis in a note generally will equal its U.S.
dollar cost (which, in the case of a note purchased with a foreign currency,
will be the U.S. dollar value of the purchase price on the date of purchase),
increased by any original issue discount and market discount included in the
United States holder's income with respect to the note, and reduced by any
principal payments on the note previously received by such holder (including
any other payments on the note that are not qualified stated interest payments)
and by the amount of any amortizable bond premium applied to reduce interest on
the note. A United States holder generally will recognize gain or loss on the
sale, exchange or retirement of a note equal to the difference between the
amount realized on the sale or retirement and the United States holder's tax
basis in the note. The amount realized on a sale, exchange or retirement for an
amount in foreign currency will be the U.S. dollar value of the amount on the
date of sale, exchange or retirement. Except to the extent described above
under "Market Discount" and under "Original Issue Discount" in connection with
notes treated as contingent payment debt instruments, and below under "Foreign
Currency Notes--Exchange Gain or Loss," and except to the extent attributable
to accrued but unpaid interest, gain or loss recognized on the sale, exchange
or retirement of a note will be capital gain or loss and will be long-term
capital gain or loss if the note was held for more than one year.
Foreign Currency Notes
Interest Payments. If an interest payment, other than original issue
discount, is denominated in or determined by reference to a foreign currency,
the amount of income recognized by a cash basis United States holder will be
the U.S. dollar value of the interest payment, based on the exchange rate in
effect on the date of receipt, regardless of whether the payment is in fact
converted into U.S. dollars. A United States holder of notes may recognize
currency exchange gain or loss with respect to foreign currency interest
payments. A cash basis United States holder who receives a foreign currency
payment will be required to include the amount of the payment in income upon
receipt. In that case, there will be no exchange gain or loss with respect to
the interest payment.
Accrual basis United States holders may determine the amount of exchange
gain or loss recognized with respect to a foreign currency interest payment
(including original issue discount but reduced by amortizable bond premium to
the extent applicable) in accordance with either of two methods as described in
this paragraph. United States holders who use the cash basis method of
accounting and who accrue original issue discount may also use either of these
two methods to recognize exchange gain or loss solely with respect to accrued
original issue discount. Under the first method, the amount of income
recognized will be based on the average exchange rate in effect during the
interest accrual period (or, with respect to an accrual period that spans two
taxable years, the partial period within the taxable year). Upon receipt of an
interest payment (including a payment attributable to accrued but unpaid
interest upon the sale or retirement of a note or accrued original issue
discount) determined by reference to a foreign currency, the United States
holder will recognize ordinary income or loss measured by the difference
between that average exchange rate and the exchange rate in effect on the date
of receipt, regardless of whether the payment is in fact converted into U.S.
dollars. Under the second method, an accrual basis United States holder and a
cash basis United States holder with accrued original issue discount may elect
to translate interest income (including original issue discount) into U.S.
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dollars at the spot exchange rate in effect on the last day of the accrual
period or, in the case of an accrual period that spans two taxable years, at
the exchange rate in effect on the last day of the partial period within the
taxable year. Additionally, if a payment of interest (including original issue
discount) is actually received within five business days of the last day of the
accrual period or taxable year, a United States holder applying the second
method may instead translate the accrued interest into U.S. dollars at the spot
exchange rate in effect on the day of actual receipt (in which case no exchange
gain or loss will result). Any election to apply the second method will apply
to all debt instruments held by the United States holder at the beginning of
the first taxable year to which the election applies or thereafter acquired by
the United States holder and may not be revoked without the consent of the IRS.
Exchange of Amounts in Other than U.S. Dollars. Foreign currency received as
interest on a note or on the sale or retirement of a note will have a tax basis
equal to its U.S. dollar value at the time the interest is received or at the
time of the sale or retirement, as the case may be. Foreign currency that is
purchased will generally have a tax basis equal to the U.S. dollar value of the
foreign currency on the date of purchase. Any gain or loss recognized on a sale
or other disposition of a foreign currency (including its use to purchase notes
or upon exchange for U.S. dollars) will be ordinary income or loss.
Original Issue Discount and Amortizable Bond Premium. In the case of a note
that is denominated in a foreign currency, original issue discount and bond
premium will be computed in units of foreign currency, and amortizable bond
premium will reduce interest income in units of the foreign currency. At the
time amortized bond premium offsets interest income, a United States holder may
realize ordinary income or loss, measured by the difference between exchange
rates at that time and at the time of the acquisition of the notes.
Market Discount. Market discount is determined in units of the foreign
currency in which the market discount bond is denominated. Accrued market
discount that is required to be taken into account on the maturity or upon
disposition of a note is translated into U.S. dollars at the spot exchange rate
on the maturity or the disposition date, as the case may be (and no part is
treated as exchange gain or loss). Accrued market discount currently includible
in income by an electing United States holder is translated into U.S. dollars
at the average exchange rate for the accrual period (or the partial accrual
period during which the United States holder held the note), and exchange gain
or loss is determined on maturity or disposition of the note (as the case may
be) in the manner described above under "Foreign Currency Notes--Interest
Payments" with respect to the computation of exchange gain or loss on the
receipt of accrued interest by an accrual method holder.
Exchange Gain or Loss. Gain or loss recognized by a United States holder on
the sale, exchange or retirement of a note that is attributable to changes in
exchange rates will be treated as ordinary income or loss which will not be
treated as interest income or expense. However, exchange gain or loss is taken
into account only to the extent of total gain or loss realized on the
transaction.
Indexed Notes
The applicable pricing supplement will contain a discussion of any special
United States federal income tax rules with respect to currency indexed notes
or other indexed notes.
Non-United States Holders
Subject to the discussion of backup withholding below, payments of
principal, any premium and interest (including original issue discount) by us
or any agent of ours (acting in its capacity as agent) to any holder of a note
that is not a United States holder (a "non-United States holder") will not be
subject to United States federal withholding tax, provided, in the case of
interest, that (i) the non-United States holder does not actually or
constructively own 10% or more of the total combined voting power of all
classes of our stock entitled to vote, (ii) the non-United States holder is not
a controlled foreign corporation for United States tax purposes that is related
to us (directly or indirectly) through stock ownership and (iii) either (A) the
non-United States holder certifies to us or our agent under penalties of
perjury that it is not a United States person and provides its name
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and address or (B) a securities clearing organization, bank or other financial
institution that holds customers' securities in the ordinary course of its
trade or business and holds the note certifies to us or our agent under
penalties of perjury that such statement has been received from the non-United
States holder by it or by another financial institution and furnishes the payor
with a copy.
A non-United States holder that does not qualify for exemption from
withholding under the preceding paragraph generally will be subject to United
States federal withholding tax at the rate of 30% (or lower applicable treaty
rate) of payments of interest, including original issue discount, on the notes.
If a non-United States holder is engaged in a trade or business in the
United States and interest, including original issue discount, on the note is
effectively connected with the conduct of such trade or business, the non-
United States holder, although exempt from the withholding tax discussed in the
preceding paragraph (provided that such holder timely furnishes the required
certification to claim such exemption), may be subject to United States federal
income tax on such interest in the same manner as if it were a United States
holder. In addition, if the non-United States holder is a foreign corporation,
it may be subject to a branch profits tax equal to 30% (or lower applicable
treaty rate) of its effectively connected earnings and profits for the taxable
year, subject to certain adjustments. For purposes of the branch profits tax,
interest on a note will be included in the earnings and profits of the holder
if the interest is effectively connected with the conduct by the holder of a
trade or business in the United States. In lieu of the certificate described
above, such a holder must provide the payor with a properly executed IRS Form
4224 (or successor form) to claim an exemption from United States federal
withholding tax.
Any capital gain, market discount or exchange gain realized on the sale,
exchange, retirement or other disposition of a note by a non-United States
holder will not be subject to United States federal income or withholding taxes
if (a) the gain is not effectively connected with a United States trade or
business of the non-United States holder and (b) in the case of an individual,
the non-United States holder is not present in the United States for 183 days
or more in the taxable year of the sale, exchange, retirement or other
disposition, and certain other conditions are met.
Notes held by an individual who is neither a citizen nor a resident of the
United States for United States federal tax purposes at the time of the
individual's death will not be subject to United States federal estate tax,
provided that the income from the notes was not or would not have been
effectively connected with a United States trade or business of the individual
and that the individual qualified for the exemption from United States federal
withholding tax (without regard to the certification requirements) described
above.
Recently finalized Treasury regulations, generally effective for payments
made after December 31, 2000, provide alternative procedures to be followed by
a non-United States holder in establishing eligibility for a withholding tax
reduction or exemption.
Purchasers of notes that are non-United States holders should consult their
own tax advisors with respect to the possible applicability of United States
withholding and other taxes upon income realized in respect of the notes.
Information Reporting and Back-Up Withholding
For each calendar year in which the notes are outstanding, we are required
to provide the Internal Revenue Service with certain information, including the
holder's name, address and taxpayer identification number (either the holder's
Social Security number or its employer identification number, as the case may
be), the aggregate amount of principal and interest (including original issue
discount) paid to that holder during the calendar year and the amount of tax
withheld, if any. This obligation, however, does not apply with respect to
certain United States holders, including corporations, tax-exempt
organizations, qualified pension and profit sharing trusts and individual
retirement accounts.
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In the event that a United States holder subject to the reporting
requirements described above fails to supply its correct taxpayer
identification number in the manner required by applicable law or underreports
its tax liability, we, our agents or paying agents or a broker may be required
to "backup" withhold a tax equal to 31% of each payment of interest (including
original issue discount), principal and any premium on the notes. This backup
withholding is not an additional tax and may be credited against the United
States holder's federal income tax liability, provided that the holder
furnishes the required information to the Internal Revenue Service.
Under current Treasury regulations, backup withholding and information
reporting will not apply to payments made by us or any of our agents (in their
capacity as such) to a non-United States holder of a note if the holder has
provided the required certification that it is not a United States person as
set forth in clause (iii) in the first paragraph under "non-United States
holders" above, or has otherwise established an exemption (provided that
neither we nor our agent has actual knowledge that the holder is a United
States person or that the conditions of an exemption are not in fact
satisfied).
Payments of the proceeds from the sale of a note to or through a foreign
office of a broker will not be subject to information reporting or backup
withholding. However, information reporting (but not backup withholding) may
apply to those payments if the broker is one of the following:
. a United States person,
. a controlled foreign corporation for United States tax purposes,
. a foreign person 50 percent or more of whose gross income from all
sources for the three-year period ending with the close of its taxable
year preceding the payment was effectively connected with a United
States trade or business or
. for payments made after December 31, 2000, a foreign partnership with
certain connections to the United States.
Payment of the proceeds from a sale of a note to or through the United
States office of a broker is subject to information reporting and backup
withholding unless the holder or beneficial owner certifies as to its taxpayer
identification number or otherwise establishes an exemption from information
reporting and backup withholding.
Recently finalized Treasury regulations unify current certification
procedures and forms relating to information reporting and backup withholding
for payments made after December 31, 2000. Among other things, these
regulations provide presumptions under which a non-United States holder is
subject to information reporting and backup withholding unless we or our agent
receives certification from the holder regarding non-United States status.
The federal income tax discussion set forth above is included for general
information only and may not be applicable depending upon a holder's particular
situation. Holders should consult their tax advisors with respect to the tax
consequences to them of the purchase, ownership and disposition of the notes,
including the tax consequences under state, local, foreign and other tax laws
and the possible effects of changes in federal or other tax laws.
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PLAN OF DISTRIBUTION
Under the terms of a distribution agreement, a form of which is attached as
an exhibit to our registration statement (File No. 333- ), we will offer
the notes on a continuing basis through Credit Suisse First Boston Corporation,
Banc One Capital Markets, Inc. and J.P. Morgan Securities Inc. as our agents.
Each of these agents has agreed to use reasonable efforts to solicit offers to
purchase notes. Unless the applicable pricing supplement indicates otherwise,
we will pay a commission to the agents. We will have the sole right to accept
offers to purchase notes and may reject any offer, in whole or in part. Each
agent will have the right, in its discretion reasonably exercised, without
notice to us, to reject any offer to purchase notes received by it, in whole or
in part.
We also may sell notes at or above par to any agent, acting as principal,
for the commission set forth on the cover page of this prospectus supplement.
The notes may be resold at market prices prevailing at the time of resale, at
prices related to those prevailing market prices, at a fixed offering price or
at negotiated prices, as determined by that agent. We also may sell notes at or
above par to any agent or to a group of underwriters for whom an agent acts as
representative. We may do this for a commission to be agreed at the time of
sale, for resale to one or more investors or purchasers at a fixed offering
price or at varying prices prevailing at the time of resale, at prices related
to those prevailing market prices at the time of the resale or at negotiated
prices. Notes purchased by an agent or by a group of underwriters may be resold
to certain securities dealers for resale to investors or to certain other
dealers. Dealers may receive compensation in the form of commissions from the
agents and/or from the purchasers for whom they may act as agents. Unless the
applicable pricing supplement specifies otherwise, any compensation allowed by
any agent to any of these dealers shall not be in excess of the commission that
we pay to the agent. After the initial public offering of notes to be resold to
investors and other purchasers on a fixed public offering price basis, the
public offering price and commission may be changed.
We may sell notes directly on our own behalf or we may accept but not
solicit offers to purchase notes through additional agents on substantially the
same terms and conditions, including commission rates, as would apply to
purchases of notes under the distribution agreement. In addition, we may
appoint additional agents for the purpose of soliciting offers to purchase
notes after we receive the prior written consent of the agents, which they have
agreed not to unreasonably withhold. Those additional agents will be named in
the applicable pricing supplement. No commission will be payable on any notes
we sell directly.
We will pay each agent a commission of .125% to .750% of the principal
amount of each note, depending on its stated maturity, sold through that agent.
The following table summarizes the compensation to be paid to the agents by
us.
<TABLE>
<CAPTION>
Total
--------------------------------
Per Note Minimum Maximum
------------ -------- ----------
<S> <C> <C> <C>
Commissions paid by Jostens.................... .125%--.750% $250,000 $1,500,000
</TABLE>
We estimate that we will incur expenses of $372,000 in connection with this
program.
The agents and any dealers to whom the agents may sell notes may be deemed
to be "underwriters" within the meaning of the Securities Act of 1933. We have
agreed to indemnify the agents against certain liabilities, including civil
liabilities under the Securities Act of 1933, or contribute to payments which
the agents may be required to make in this regard. We have agreed to reimburse
the agents for certain expenses.
Unless the applicable pricing supplement indicates otherwise, you must pay
for notes, other than foreign currency notes in funds immediately available in
New York City. For payment of the purchase price of foreign currency notes, see
"Description of the Notes--Foreign Currency Notes" above.
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The notes are a new issue of securities with no established trading market
and will not be listed on any securities exchange. No assurance can be given as
to the existence or liquidity of the secondary market for the notes.
The agents may engage in over-allotment, stabilizing transactions and
syndicate covering transactions and may impose penalty bids as permitted by
Regulation M under the Exchange Act. Over-allotment involves syndicate sales in
excess of the offering size, which creates a syndicate short position.
Stabilizing transactions permit bids to purchase the underlying security so
long as the stabilizing bids do not exceed a specified maximum. Syndicate
covering transactions involve purchases of the notes in the open market after
the distribution has been completed in order to cover syndicate short
positions. Penalty bids permit the agents to reclaim a selling concession from
a syndicate member when the notes originally sold by that syndicate member are
purchased in a syndicate covering transaction to cover syndicate short
positions. These stabilizing transactions, syndicate covering transactions and
penalty bids may cause the price of the notes to be higher than it would
otherwise be in the absence of the transactions. These transactions, if
commenced, may be discontinued at any time.
In the ordinary course of their respective businesses, the agents and their
affiliates have engaged, and may in the future engage, in commercial banking
and/or investment banking transactions with us and our affiliates.
LEGAL OPINIONS
Opinions regarding the validity of the notes being offered will be issued
for us by Dorsey & Whitney LLP, Minneapolis, Minnesota, and for the agents by
Oppenheimer Wolff & Donnelly LLP, Minneapolis, Minnesota. In these opinions,
certain assumptions will be made regarding future action required to be taken
by us and the trustee in connection with the issuance and sale of any
particular notes, the specific terms of those notes and other matters which may
affect the validity of notes but which cannot be ascertained on the date of the
relevant opinions.
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GLOSSARY
Set forth below are definitions of some of the terms used in this prospectus
supplement and not defined in the attached prospectus.
"business day" means any day, other than a Saturday or Sunday, that meets
each of the following applicable requirements. The day is:
(a) not a day on which banking institutions are authorized or required
by law or regulation to be closed in New York City;
(b) with respect to foreign currency notes (other than foreign currency
notes denominated in euro only), not a day on which banking institutions
are authorized or required by law or regulation to be closed in the
principal financial center in the country of the specified currency;
(c) with respect to foreign currency notes denominated in euro, any date
on which the Trans-European Automated Real-Time Gross Settlement Express
Transfer (TARGET) System is open; and
(d) with respect to LIBOR notes, a London banking day.
"calculation agent" means the agent we appoint to calculate interest rates
for floating rate notes. The pricing supplement will state who will act as
calculation agent.
"calculation date" means, with respect to any interest determination date,
the date on which the calculation agent is to calculate an interest rate for a
floating rate note. Unless the pricing supplement specifies otherwise, the
calculation date relating to an interest determination date for a floating rate
note will be the first to occur of (a) the tenth calendar day after that
interest determination date, or, if that day is not a business day, the next
succeeding business day or (b) the business day preceding the applicable
interest payment date or maturity of that note, as the case may be. However,
LIBOR will be calculated on the LIBOR rate interest determination date.
"designated LIBOR page" means (a) if "LIBOR Reuters" is specified in the
applicable pricing supplement, the display on the Reuter Monitor Money Rates
Service (or any successor service) on the page specified in that pricing
supplement (or any other page as may replace that page on that service) for the
purpose of displaying the London interbank rates of major banks for the
applicable index currency, or (b) if "LIBOR Telerate" is specified in the
applicable pricing supplement as the method for calculating LIBOR, the display
on the Telerate Service (or any successor service) on the page specified in
that pricing supplement (or any other page as may replace that page on that
service) for the purpose of displaying the London interbank rates of major
banks for the applicable index currency.
"H.15(519)" means the publication entitled "Statistical Release H.15(519),
Selected Interest Rates", or any successor publication, published by the Board
of Governors of the Federal Reserve System.
"H.15 Daily Update" means the daily update of H.15(519), available through
the world wide web site of the Board of Governors of the Federal Reserve System
at http://www.bog.frb.fed.us/releases/h15/update, or any successor site or
publication.
"index currency" means the currency or composite currency specified in the
applicable pricing supplement as to which LIBOR will be calculated. If no
currency or composite currency of this kind is specified in the applicable
pricing supplement, the index currency will be U.S. dollars.
"index maturity" means, for a floating rate note, the period to maturity of
the instrument or obligation on which the interest rate quotation is based, as
set forth in the pricing supplement.
"initial interest rate" means the rate at which a floating rate note will
bear interest from and including its issue date to but excluding the first
interest reset date, as indicated in the applicable pricing supplement.
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"interest determination date" means the date as of which the interest rate
for a floating rate note is to be calculated, to be effective as of the
following interest reset date and calculated on the related calculation date.
However, LIBOR will be calculated on the LIBOR rate interest determination
date. The interest determination date relating to an interest reset date for a
commercial paper rate note, for a prime rate note, for a federal funds rate
note and for a CD rate note will be the second business day preceding that
interest reset date. The interest determination date relating to an interest
reset date for a LIBOR note will be the second London banking day preceding
that interest reset date. The interest determination date relating to an
interest reset date for a Treasury rate note will be the day of the week during
which that interest reset date falls on which Treasury bills of the index
maturity designated in the pricing supplement would normally be auctioned.
Treasury bills are usually sold at auction on the Monday of each week, unless
that day is a legal holiday, in which case the auction is usually held on the
following Tuesday or may be held on the preceding Friday. If, as the result of
a legal holiday, an auction is so held on the preceding Friday, that Friday
will be the Treasury interest rate determination date pertaining to the
interest reset date occurring in the following week.
"interest payment date" means the date on which payment of interest on a
note (other than payment at maturity) is to be made. Unless the applicable
pricing supplement indicates otherwise, the interest payment dates for the
fixed rate notes will be February 15 and August 15 of each year and at
maturity. Unless the applicable pricing supplement indicates otherwise and
except as provided below, the interest payment dates for any floating rate note
will be:
(a) in the case of floating rate notes that reset weekly, on the third
Wednesday of March, June, September and December of each year;
(b) in the case of floating rate notes that reset daily or monthly, on
the third Wednesday of each month or on the third Wednesday of March, June,
September and December of each year (as indicated in the pricing
supplement);
(c) in the case of floating rate notes that reset quarterly, on the
third Wednesday of March, June, September and December of each year, in the
case of floating rate notes that reset semi-annually, on the third
Wednesday of the two months of each year specified in the pricing
supplement;
(d) in the case of floating rate notes that reset annually, on the third
Wednesday of the month specified in the pricing supplement; and
(e) in each case, at maturity.
If an interest payment date for any fixed rate note falls on a day that is
not a business day for that note, the interest payment for that note will be
made on the following business day for that note, and no interest on that
payment will accrue from and after that interest payment date. If an interest
payment date (other than an interest payment date at maturity) for any floating
rate note would otherwise be a day that is not a business day for that note,
that interest payment date will be postponed to the next business day for that
note, and interest will continue to accrue (except that, for a LIBOR note, if
that business day is in the following calendar month, that interest payment
date will be the preceding business day for that LIBOR note).
"interest reset date" means the date on which a floating rate note will
begin to bear interest at the interest rate determined as of any interest
determination date. Unless the pricing supplement specifies otherwise, the
interest reset dates will be:
(a) in the case of floating rate notes that reset daily, each business
day;
(b) in the case of floating rate notes (other than Treasury rate notes)
that reset weekly, the Wednesday of each week;
(c) in the case of Treasury rate notes that reset weekly, the Tuesday of
each week (except as provided below);
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(d) in the case of floating rate notes that reset monthly, the third
Wednesday of each month;
(e) in the case of floating rate notes that reset quarterly, the third
Wednesday of March, June, September and December of each year;
(f) in the case of floating rate notes that reset semi-annually, the
third Wednesday of each of two months of each year specified in the pricing
supplement; and
(g) in the case of floating rate notes that reset annually, the third
Wednesday of one month of each year specified in the pricing supplement.
If any interest reset date for any floating rate note would otherwise be a day
that is not a business day for that floating rate note, that interest reset
date will be postponed to the next business day for that floating rate note
(except that, for a LIBOR note, if that business day is in the following
calendar month, that interest reset date will be the preceding business day for
that LIBOR note). If a Treasury bill auction (as described in the definition of
"interest determination date") falls on any day that would otherwise be an
interest reset date for a Treasury rate note, then that interest reset date
will instead be the first business day following that auction date.
"London banking day" means any day on which dealings in deposits in U.S.
dollars are transacted in the London interbank market.
"market exchange rate" for any specified currency means the noon buying rate
in New York City for cable transfers for that specified currency as certified
for customs purposes by (or if not certified, as otherwise determined by) the
Federal Reserve Bank of New York.
"maturity" means the date on which the principal of a note becomes due,
whether at stated maturity, upon redemption or otherwise. If the maturity of
any note falls on a day that is not a business day, the payment of principal,
premium, if any, and interest for that note will be made on the following
business day, and no interest on that payment will accrue from and after that
maturity.
"maximum interest rate" means, for any floating rate note, a maximum
numerical interest rate limitation, or ceiling, on the rate at which interest
may accrue on that during any interest period.
"minimum interest rate" means, for any floating rate note, a minimum
numerical interest rate limitation, or floor, on the rate at which interest may
accrue on that during any interest period.
"money market yield" means a yield (expressed as a percentage rounded to the
next higher one hundred thousandth of a percentage point) calculated in
accordance with the following formula:
D x 360
money market yield = ------------- x100
360 - (D x M)
where "D" refers to the annual rate for the commercial paper, quoted on a bank
discount basis and expressed as a decimal, and "M" refers to the actual number
of days in the interest period for which interest is being calculated.
"paying agent" means the agent we appoint to pay principal, premium, if any,
and interest on the notes. The pricing supplement will state who will act as
the paying agent.
"principal financial center" means the capital city of the country issuing
the index currency, except that with respect to United States dollars,
Australian dollars, Deutsche marks, Dutch guilders, Italian lire and Swiss
francs, the principal financial center will be New York City, Sydney,
Frankfurt, Amsterdam, Milan and Zurich, respectively.
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"regular record date" means the date on which a note must be held in order
for the holder to receive an interest payment on the next interest payment
date. Unless the pricing supplement specifies otherwise, the regular record
date for any interest payment date with respect to any floating rate note will
be the fifteenth day (whether or not a business day) prior to that interest
payment date. The regular record dates for the fixed rate notes will be the
February 1 and August 1 next preceding the February 15 and August 15 interest
payment dates.
"Reuters Screen USPRIME1 Page" means the display on the Reuter Monitor Money
Rates Service (or any successor service) on the "USPRIME1" page (or any other
page as may replace the USPRIME1 page on such service) for the purpose of
displaying prime rates or base lending rates of major U.S. banks.
"spread" means the number of basis points, if any, to be added to the
commercial paper rate, the prime rate, LIBOR, the Treasury rate, the federal
funds rate, the CD rate or any other interest rate index in effect at various
times for a note, which amount will be set forth in the pricing supplement.
"spread multiplier" means the percentage by which the commercial paper rate,
the prime rate, LIBOR, the Treasury rate, the federal funds rate, the CD rate
or any other interest rate index in effect at various times for a note is to be
multiplied, which percentage will be set forth in the pricing supplement.
S-27
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities, and it is not soliciting an offer to buy +
+these securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED JULY 23, 1999
PROSPECTUS
Jostens, Inc.
$200,000,000
Debt Securities
-----------
We will provide specific terms of these securities in supplements to this
prospectus. You should read this prospectus and any supplement carefully before
you invest.
-----------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
This prospectus is dated , 1999
<PAGE>
SUMMARY
This summary highlights selected information from this document and may not
contain all the information that is important to you. To understand the terms
of our securities, you should carefully read this document with the attached
prospectus supplement that together give the specific terms of the securities
we are offering. You should also read the documents we have referred you to in
"Where You Can Find More Information About Jostens" on page 14 for information
on our company and our financial statements.
Jostens, Inc.
We are a leading provider of products and services that help people
celebrate important moments, recognize achievements and build affiliations. Our
products include yearbooks, class rings, graduation products, school
photography and sports and employee achievement awards.
Our businesses are grouped into our school-based products segment and our
recognition segment. Our school products segment primarily manufactures and
sells products and services to school and college students. These products and
services include yearbooks, class rings, graduation products and student
photography packages. Our recognition segment manufactures and sells customized
sales, service and business achievement awards.
We are a Minnesota corporation, organized in 1906, with our principal
executive offices located at 5501 Norman Center Drive, Minneapolis, Minnesota
55437 (Telephone: (612) 830-3300).
The Securities We May Offer
This prospectus is part of a registration statement (No. 333- ) that we
filed with the SEC utilizing a "shelf" registration process. Under this shelf
process, we may offer from time to time up to $200,000,000 of debt securities.
This prospectus provides you with a general description of the securities we
may offer. Each time we offer securities, we will provide you with a prospectus
supplement that will describe the specific amounts, prices and terms of the
securities being offered. The prospectus supplement may also add, update or
change information contained in this prospectus.
RISK FACTORS
There are a number of factors, including those specified below, which may
adversely affect our ability to make payments on the notes. You could therefore
lose a substantial portion or all of your investment in these notes.
Consequently, an investment in the notes should only be considered by persons
who can assume such risk. The risk factors described below are not necessarily
exhaustive, and we encourage you to perform your own investigation with respect
to the notes and our company.
Problems Integrating Computer Systems Could Cause Us To Lose Customers And May
Adversely Affect Our Business
We rely on effective information systems for our day to day operations and
have many different information systems for our various products. In the first
quarter of 1999, we implemented a new information system in order to be year
2000 compliant in our Recognition segment. We had some problems implementing
this system. This resulted in an increased backlog of product shipments.
Customers in our Recognition segement require timely product delivery and these
delays and backlog may adversely impact our relationships with Recognition
segement customers. We cannot assure you that our implementation of other
information systems in the future will be free of problems. As a result of past
or future implementation problems, we could lose existing customers, have
difficulty attracting new customers, have customer and supplier disputes, have
increased administrative expenses or experience other adverse consequences, all
of which could materially and adversely impact our business, financial
condition, operating results or cash flows.
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<PAGE>
We Face Uncertainty Regarding Year 2000 Compliance
We are in the process of modifying our computer systems to accommodate the
year 2000. We currently expect to complete this modification sufficiently in
advance of the year 2000 to avoid adverse impacts on our operations. However,
we cannot assure you that we will be able to effectively address our year 2000
issues in a timely and cost-efficient manner and without interruption to our
business. We cannot assure you that year 2000 difficulties encountered by our
customers, suppliers and other third parties with whom we conduct business will
not have a material adverse impact on our business, financial condition,
operating results or cash flows.
Changes in Our Credit Rating May Affect the Market Value of the Debt Securities
Our credit ratings are an assessment of our ability to pay our obligations.
As a result, real or anticipated changes in our credit ratings will generally
affect the market value of your debt securities. Any material change in the
following factors could impact our results and result in a change in our credit
ratings:
. the price of gold;
. our access to students and consumers in schools;
. the seasonality of our business;
. our relationship with our sales force;
. fashion and demographic trends;
. our ability to respond to customer change orders and delivery schedules;
. our ability to maintain competitive pricing and promotional program
changes;
. our ability to manufacture quality products and continue improving
operating efficiencies;
. the impact of year 2000 compliance on our computer-based systems and our
external relationships.
Our Ability to Redeem the Debt Securities May Adversely Affect Your Return on
the Debt Securities
If your debt securities are redeemable at our option or are subject to
mandatory redemption, we may, in the case of optional redemption, or must, in
the case of mandatory redemption, redeem the debt securities at times when
prevailing interest rates are relatively low. In that event, you would not be
able to continue to benefit from the relatively high interest rate on the debt
securities at that time. You would also likely be unable to reinvest the
redemption proceeds in a comparable security at an interest rate as high as
that of the debt securities.
We Cannot Assure You that a Market Will Develop for the Debt Securities or What
the Market Price Will Be
We cannot assure you that a trading market for the debt securities will
develop or be maintained. Many factors independent of our creditworthiness
affect the trading market. These factors include:
. complexity and volatility of the index or formula applicable to the debt
securities;
. method of calculating the principal, premium and interest in respect of
the debt securities;
. time remaining to the maturity of the debt securities;
. outstanding amount of the debt securities;
. redemption features of the debt securities;
. amount of other debt securities linked to the index or formula
applicable to the debt securities; and
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<PAGE>
. level, direction and volatility of market interest rates generally.
You should be aware that there may be few investors, if any, willing to buy
when you decide to sell your debt securities. This limited market may affect
the price you receive for your debt securities or your ability to sell your
debt securities. You should not purchase debt securities unless you understand,
and know you can bear, the investment risks.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of our earnings to our fixed
charges for the periods indicated:
<TABLE>
<CAPTION>
Three
Six Months Months
Years Ended Ended Years Ended Ended
-------------------------- ------------ --------------------- --------
June 30, June 30, June 30, December 28, January 3, January 2, April 3,
1994 1995 1996 1996 1998 1999 1999
-------- -------- -------- ------------ ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to
fixed charges.......... 6.5 13.4 8.6 1.0 11.4 10.2 9.0
</TABLE>
- --------
Earnings consist principally of income from continuing operations before
income taxes, plus fixed charges. Fixed charges consist principally of interest
costs.
USE OF PROCEEDS
We will use the net proceeds we receive from the sale of the debt securities
for general corporate purposes, unless we specify another use in the applicable
prospectus supplement. General corporate purposes may include working capital
additions, capital expenditures, stock redemption, debt repayment or financing
for possible acquisitions.
DESCRIPTION OF DEBT SECURITIES
We will offer debt securities which represent our unsecured senior general
obligations under an indenture dated as of , 1999 between us and Norwest
Bank Minnesota, N.A., as trustee. The debt securities will have the same rank
as all of our other unsecured, unsubordinated senior debt.
The following description sets forth the general terms and provisions that
could apply to the debt securities. This description of certain provisions of
the indenture is not complete. You should refer to the applicable provisions of
the indenture filed as exhibit 4.1 to our registration statement filed with the
Securities and Exchange Commission (File No. 333- ) covering the debt
securities. Each prospectus supplement will state the particular terms that
actually will apply to the debt securities included in the supplement.
Some of the capitalized terms used in the following discussion are defined
in the indenture, and their definitions are incorporated by reference into this
prospectus.
General
The indenture does not limit the aggregate principal amount of debt
securities that we may issue under it. The debt securities may be issued in one
or more series as we may authorize at various times. A series of debt
securities may be issued at more than one time and, unless we agree otherwise
with the trustee, may be re-opened for issuance without notice to holders of
such series. All debt securities will be unsecured and will have the same rank
as all of our other unsecured and unsubordinated debt. The debt securities may
be issued as original issue discount debt securities and sold at a substantial
discount below their principal amount. The
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<PAGE>
prospectus supplement relating to the particular series of debt securities
being offered will specify the amounts, prices and terms of those debt
securities. These terms may include:
. the title and aggregate principal amount of the debt securities;
. the maturity date or dates for the debt securities and any rights to
extend these dates;
. the person to whom interest is payable, if other than the person in
whose name the debt security is registered as of the record date for
payment of interest;
. any annual rate or rates, which may be fixed or variable, or the method
of determining any rate or rates, at which the debt securities will bear
interest;
. the date or dates from which interest shall accrue and the interest
payment date or dates;
. the place or places where the principal of and any premium and interest
on the debt securities will be payable;
. the currency, currencies or composite currency in which the debt
securities are denominated and principal and interest may be payable,
and for which the debt securities may be purchased, if other than United
States dollars;
. any redemption or sinking fund terms;
. any event of default or covenant with respect to the debt securities of
a particular series, if not set forth in this prospectus;
. any index used to determine the amount of principal, premium or interest
payable with respect to the debt securities;
. whether the debt securities are to be issued in whole or in part in the
form of one or more global securities and the depositary for the global
security or securities;
. if other than in denominations of $1,000 or multiples of $1,000, the
denominations in which debt securities will be issued;
. the part of the principal amount of debt securities which will be
payable upon acceleration if less than the entire amount;
. if the principal amount of the debt securities or interest paid on the
debt securities are set forth or payable in a currency other than U.S.
dollars, whether and under what terms and conditions we may defease the
debt securities; and
. any other terms of the series, which will not conflict with the terms of
the indenture.
We will issue the debt securities in fully registered form without coupons.
Unless we specify otherwise in the applicable prospectus supplement, we will
issue debt securities denominated in U.S. dollars in denominations of $1,000 or
multiples of $1,000. Debt securities may also be issued pursuant to the
indenture in transactions exempt from the registration requirements of the
Securities Act of 1933. Those debt securities will not be considered in
determining the aggregate amount of securities issued under the registration
statement.
We will describe special federal income tax and other considerations
relating to debt securities denominated in foreign currencies in the applicable
prospectus supplement.
Unless we specify otherwise in the applicable prospectus supplement, the
covenants contained in the indenture and the debt securities will not provide
special protection to holders of debt securities if we enter into a highly
leveraged transaction, recapitalization or restructuring.
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<PAGE>
Exchange, Registration and Transfer
Debt securities of any series that are not global securities will be
exchangeable for other registered securities of the same series and of like
aggregate principal amount and tenor in different authorized denominations.
Transfers and exchanges may be made without service charge and upon payment of
any taxes and other governmental charges as described in the indenture. The
security registrar or the transfer agent will effect the transfer or exchange
upon being satisfied with the documents of title and identity of the person
making the request. We have appointed the trustee as security registrar for the
indenture. If a prospectus supplement refers to any transfer agents, in
addition to the security registrar, initially designated by us with respect to
any series of debt securities, we may at any time rescind the designation of
any such transfer agent or approve a change in the location through which such
transfer agent acts. We may at any time appoint additional transfer agents with
respect to any series of debt securities.
Payment and Paying Agents
Unless we specify otherwise in the applicable prospectus supplement, payment
of principal, any premium and any interest on debt securities will be made at
the office of the paying agent or paying agents that we appoint at various
times. However, at our option, we may make interest payments by check mailed to
the address, as it appears in the security register, of the person entitled to
the payments. Unless we specify otherwise in the applicable prospectus
supplement, we will make payment of any installment of interest on debt
securities to the person in whose name that security is registered at the close
of business on the regular record date for such interest.
If we do not pay interest when due, that interest will no longer be payable
to the holder of the debt security on the record date for such interest. We
will pay any defaulted interest, at our election:
. to the person in whose name the debt security is registered at the close
of business on a special record date set by the Trustee between 10-15
days before the payment of such defaulted interest and at least 10 days
after the receipt by the Trustee of notice of the payment by us; or
. in any other lawful manner that is consistent with the requirements of
any securities exchange on which the debt securities are listed if,
after we give notice to the Trustee, the Trustee determines the manner
of payment is practicable.
Global Securities
The debt securities of a series may be issued in whole or in part in the
form of one or more global certificates that we will deposit with a depositary
identified in the applicable prospectus supplement. Global securities may be
issued in either temporary or permanent form. Unless and until it is exchanged
in whole or in part for the individual debt securities it represents, a global
security may not be transferred except as a whole:
. by the applicable depositary to a nominee of the depositary,
. by any nominee to the depositary itself or another nominee, or
. by the depositary or any nominee to a successor depositary or any
nominee of the successor.
We will describe the specific terms of the depositary arrangement with
respect to a series of debt securities in the applicable prospectus supplement.
We anticipate that the following provisions will generally apply to depositary
arrangements.
When we issue a global security, the depositary for the global security or
its nominee will credit, on its book-entry registration and transfer system,
the respective principal amounts of the individual debt securities represented
by that global security to the accounts of persons that have accounts with the
depositary, known as "participants." Those accounts will be designated by the
dealers, underwriters or agents with respect to the
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<PAGE>
underlying debt securities or by us if those debt securities are offered and
sold directly by us. Ownership of beneficial interests in a global security
will be limited to participants or persons that may hold interests through
participants. For interests of participants, ownership of beneficial interests
in the global security will be shown on records maintained by the applicable
depositary or its nominee. For interests of persons other than participants,
that ownership information will be shown on the records of participants.
Transfer of that ownership will be effected only through those records. The
laws of some states require that certain purchasers of securities take physical
delivery of securities in definitive form. These limits and laws may impair our
ability to transfer beneficial interests in a global security.
As long as the depositary for a global security, or its nominee, is the
registered owner of that global security, the depositary or nominee will be
considered the sole owner or holder of the debt securities represented by the
global security for all purposes under the applicable indenture. Except as
provided below, owners of beneficial interests in a global security:
. will not be entitled to have any of the underlying debt securities
registered in their names;
. will not receive or be entitled to receive physical delivery of any of
the underlying debt securities in definitive form; and
. will not be considered the owners or holders under the indenture
relating to those debt securities.
Payments of principal of, any premium and any interest on individual debt
securities represented by a global security registered in the name of a
depositary or its nominee will be made to the depositary or its nominee as the
registered owner of the global security representing such debt securities.
Neither we, the trustee for the debt securities, any paying agent nor the
registrar for the debt securities will be responsible for any aspect of the
records relating to or payments made by the depositary or any participants on
account of beneficial interests of the global security.
We expect that the depositary or its nominee, upon receipt of any payment of
principal, any premium or interest relating to a permanent global security
representing any series of debt securities, immediately will credit
participants' accounts with the payments. Those payments will be credited in
amounts proportional to the respective beneficial interests of the participants
in the principal amount of the global security as shown on the records of the
depositary or its nominee. We also expect that payments by participants to
owners of beneficial interests in the global security held through those
participants will be governed by standing instructions and customary practices.
Those payments will be the sole responsibility of those participants.
If the depositary for a series of debt securities is at any time unwilling,
unable or ineligible to continue as depositary and we do not appoint a
successor depositary within 90 days, we will issue individual debt securities
of that series in exchange for the global security or securities representing
that series. In addition, we may at any time in our sole discretion determine
not to have any debt securities of a series represented by one or more global
securities. In that event, we will issue individual debt securities of that
series in exchange for the global security or securities. Further, if we
specify, an owner of a beneficial interest in a global security may, on terms
acceptable to us, the trustee and the applicable depositary, receive individual
debt securities of that series in exchange for those beneficial interests. The
foregoing is subject to any limitations described in the applicable prospectus
supplement. In any such instance, the owner of the beneficial interest will be
entitled to physical delivery of individual debt securities equal in principal
amount to the beneficial interest and to have the debt securities registered in
its name. Those individual debt securities will be issued in denominations,
unless we specify otherwise, of $1,000 or whole multiples of $1,000.
Certain Restrictive Covenants
Limitations on Liens. Unless we specify otherwise in the applicable
prospectus supplement, neither we nor any restricted subsidiary, will incur,
issue, assume or guarantee any debt secured by a mortgage, lien, pledge or
other encumbrance upon any principal property, without providing that the debt
securities will be secured equally and ratably or prior to the debt.
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<PAGE>
A principal property is any manufacturing or processing plant, consisting of
real estate buildings and fixtures located within the United States of America
and owned by us or any of our subsidiaries, and having a gross book value,
without deducting any depreciation reserves, of more than 4% of our
consolidated net tangible assets. A principal property does not include any
plant to the extent financed by obligations issued by a state or local
governmental unit under certain provisions of the internal revenue code or any
plant which is not of material importance to the business conducted by us and
our subsidiaries.
A restricted subsidiary is a subsidiary of ours that owns a principal
property.
Debt includes any notes, bonds, debentures or other similar evidences of
indebtedness for money borrowed.
Consolidated net tangible assets is the total amount of assets, less
applicable reserves and other properly deductible items, after deducting (a)
all current liabilities, excluding any debt having a maturity of less than 12
months from the date of our most recent consolidated balance sheet but which by
its terms is renewable or extendable beyond 12 months from such date at our
option, and (b) all goodwill, trade names, patents, unamortized debt discount
and expense and any other like intangibles, all as set forth on our most recent
consolidated balance sheet and computed in accordance with generally accepted
accounting principles.
The limitation on liens does not apply to:
. Liens existing on the date of the indenture;
. Liens on any principal property that secure or pay the costs of
acquiring, constructing or improving that property and which are created
or assumed at the time of, or within 120 days of, the acquisition,
construction or improvement;
. Liens of or upon any acquired property, shares of capital stock or debt
existing at the time it is acquired by us, whether by merger,
consolidation, purchase, lease or some other method;
. Liens in favor of us or any restricted subsidiary;
. Liens in favor of any state or federal government, any agency,
department or subdivision of any state or federal government, or any
other country or political subdivision of any other country, to secure
contractual or statutory obligations or to secure any debt incurred to
finance the cost of acquiring, constructing or improving the property
that is subject to the lien;
. Liens imposed by law, including mechanics', workmen's, materialmen's,
carriers' warehousemen's, vendors' or other liens arising in the
ordinary course of business or federal, state or municipal liens arising
out of contracts for products or services sold by us or our
subsidiaries, or deposits or pledges to release such liens;
. Pledges or deposits under workmen's compensation or similar laws and
judgments liens under such laws which are not currently dischargeable;
. Good faith deposits in connection with bids, tenders, contracts or
leases to which we or our restricted subsidiaries are a party, or
deposits to secure public or statutory obligations of us or our
restricted subsidiaries;
. Deposits to obtain or maintain self-insurance or to obtain the benefits
of any laws, regulations or arrangements relating to unemployment
insurance, pensions, social security or similar matters;
. Deposits of cash or U.S. obligations to secure surety, appeal or customs
bonds to which we or any of our restricted subsidiaries are a party;
. Liens created by or as a result of any litigation or other proceeding
which is being contested in good faith by appropriate proceedings or
liens incurred to obtain a stay or discharge of any litigation or other
proceeding;
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. Liens for taxes, assessments, governmental charges or levies not yet due
or delinquent, or which can be paid without penalty or are being
contested in good faith by appropriate proceedings;
. Restrictions on real property which do not interfere materially with the
property's use or materially detract from its value, except for liens
resulting from governmental action; and
. Any extension, renewal or replacement of any of the liens referred to
above.
The limitation on liens also does not apply if at the time and after giving
effect to any debt secured by a lien and any retirement of a lien:
. the total amount of all existing debt secured by liens that does not
equally and ratably secure the debt securities and is not subject to the
exceptions described above; plus
. the present value of the net amount of rent, discounted at the rate of
interest implicit in the applicable lease, required to be paid during
the remaining term of all leases that we and our subsidiaries have
entered into as sale and leaseback transactions, described below in
"Limitations on Sale and Leaseback";
does not exceed the greater of 25% of our consolidated net tangible assets, as
defined below, or $30,000,000.
Limitations on Sale and Leaseback. Unless we specify otherwise in the
applicable prospectus supplement, neither we nor any restricted subsidiary of
ours will enter into any sale and leaseback transaction. A sale and leaseback
transaction occurs when we or a subsidiary of ours sell or plans to sell or
transfer a principal property to a lender or investor and we or a restricted
subsidiary will in turn lease the principal property from the lender or
investor for a period of three or more years.
The restrictions on sale and leaseback transactions do not apply where
either: (a) we or our restricted subsidiary would be entitled to create debt
secured by a lien on the property to be leased, without equally and ratably
securing the debt securities, or (b) within four months after the effective
date of the sale and leaseback transaction, we apply to retire debt of ours
maturing by its terms more than one year after its original creation by
applying, an amount equal to the greater of:
. the net proceeds of the sale of the real property leased pursuant to the
transaction, or
. the fair market value of the real property leased at the time of
entering into the transaction.
The limitation on sale and leaseback transactions also does not apply if at
the time of the sale and leaseback:
. the present value of the net amount of rent, discounted at the rate of
interest implicit in the applicable lease, required to be paid during
the remaining term of all leases that we and our restricted subsidiaries
have entered into as sale and leaseback transactions; plus
. the total amount of all existing debt secured by liens that does not
equally and ratably secure the debt securities and is not subject to the
exceptions described above in "Limitations on Liens"
does not exceed the greater of 25% of our consolidated net tangible assets or
$30,000,000.
Limitation on Consolidations and Mergers. We may not consolidate or merge
with any other person or convey or transfer all or substantially all of our
properties and assets to another person or permit another corporation to merge
into us, unless, among other conditions:
. the successor is a corporation, partnership or trust organized and
validly existing under the laws of the United States or any state;
. the successor person, if not us, assumes our obligations on the debt
securities and under the indenture; and
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. after giving effect to the transaction and treating any debt which
becomes our obligation as a result of the transaction as incurred by us
at that time, no event of default occurs under the indenture.
Modification of the Indenture
Under the indenture our rights and obligations and the rights of the holders
may be modified with the consent of the holders of at least a majority in
principal amount of the then outstanding debt securities of each series
affected by the modification. None of the following modifications, however, is
effective against any holder without the consent of the holders of all of the
affected outstanding debt securities:
. changing the maturity, installment or interest rate of any of the debt
securities;
. reducing the principal amount, any premium or the rate of interest of
any of the debt securities;
. reducing the principal amount of an original issue discount debt
security due and payable upon acceleration of its maturity;
. changing the place for payment of or the currency, currencies or
currency unit or units in which any principal, premium or interest of
any of the debt securities is payable;
. impairing any right to take legal action for an overdue payment;
. reducing the percentage in principal amount of outstanding securities
required to modify or waive compliance with the indenture; or
. with some exceptions, modifying the provisions for the waiver of certain
covenants and defaults and any of the foregoing provisions.
Any actions we or the trustee may take toward adding to our covenants,
adding events of default or establishing the structure or terms of the debt
securities as permitted by the indentures will not require the approval of any
holder of debt securities. In addition, we or the trustee may cure ambiguities
or inconsistencies in the indentures or make other provisions without the
approval of any holder as long as no holder's interests are materially and
adversely affected.
Waiver of Certain Covenants
The indenture provides that we will not be required to comply with certain
restrictive covenants, including those described above under "Certain
Restrictive Covenants," if the holders of at least a majority in principal
amount of each series of outstanding debt securities affected waive compliance
with the restrictive covenants.
Events of Default, Notice and Waiver
"Event of default" when used in the indenture, will mean any of the
following in relation to a series of debt securities:
. failure to pay interest on any debt security for 30 days after the
interest becomes due;
. failure to pay the principal or any premium on any debt security when
due;
. failure to deposit any sinking fund payment for 30 days after such
payment becomes due;
. failure to perform or breach of any other covenant or warranty in the
indenture that continues for 60 days after the trustee or the holders of
at least 25% in principal amount of the outstanding debt securities of
the series notifies us of the failure or breach;
. certain events of bankruptcy, insolvency or reorganization; or
. any other event of default provided for debt securities of that series.
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If any event of default relating to outstanding debt securities of any
series occurs and is continuing, either the trustee or the holders of at least
25% in principal amount of the then outstanding debt securities of that series
may declare the principal of all of the outstanding debt securities of such
series to be due and immediately payable. At any time after an acceleration of
any debt securities of a series is made, but before a judgment for payment of
money is obtained, the holders of at least a majority in principal amount of
the outstanding debt securities of that series may, under certain
circumstances, rescind such acceleration.
The holders of at least a majority in principal amount of the outstanding
debt securities of any series may direct the time, method and place of
conducting any proceeding for any remedy available to the trustee, or of
exercising any trust or power conferred on the trustee, with respect to the
debt securities of that series. The trustee may act in any way that is
consistent with those directions and may decline to act if any of the
directions is contrary to law or to the indenture or would involve the trustee
in personal liability.
The holders of at least a majority in principal amount of the outstanding
debt securities of any series may on behalf of the holders of all of the
outstanding debt securities of the series waive any past default (and its
consequences) under the indenture relating to the series, except a default (a)
in the payment of the principal of or any premium or interest on any of the
debt securities of the series or (b) with respect to a covenant or provision of
such indentures which, under the terms of such indenture cannot be modified or
amended without the consent of the holders of all of the outstanding debt
securities of the series affected.
The indenture contains provisions entitling the trustee, subject to the duty
of the trustee during an event of default to act with the required standard of
care, to be indemnified by the holders of the debt securities of the relevant
series before proceeding to exercise any right or power under the indenture at
the request of those holders.
The indenture requires the trustee to, within 90 days after the occurrence
of a default known to it with respect to any series of outstanding debt
securities, give the holders of that series notice of the default if uncured
and unwaived. However, the trustee may withhold this notice if it in good faith
determines that the withholding of this notice is in the interest of those
holders. However, the trustee may not withhold this notice in the case of a
default in payment of principal, premium, interest or sinking fund installment
with respect to any debt securities of the series. The above notice shall not
be given until at least 30 days after the occurrence of a default in the
performance of or a breach of a covenant or warranty in the indenture other
than a covenant to make payment. The term "default" for the purpose of this
provision means any event that is, or after notice or lapse of time, or both,
would become, an event of default with respect to the debt securities of that
series.
The indenture requires us to file annually with the trustee a certificate,
executed by one of our officers, indicating whether the officer has knowledge
of any default under the indenture.
Notices
Notices to holders of debt securities will be sent by mail to the addresses
of those holders as they appear in the security register.
Replacement of Securities
We will replace any mutilated debt security at the expense of the holder
upon surrender of the mutilated debt security to the trustee. We will replace
debt securities that are destroyed, stolen or lost at the expense of the holder
upon delivery to the trustee of evidence of the destruction, loss or theft of
the debt securities satisfactory to us and to the trustee. In the case of a
destroyed, lost or stolen debt security, an indemnity satisfactory to the
trustee and us may be required at the expense of the holder of the debt
security before a replacement debt security will be issued.
11
<PAGE>
Defeasance
The indenture contains a provision that, unless made inapplicable to any
series of debt securities, permits us to elect (a) to defease and be discharged
from all of our obligations, subject to limited exceptions with respect to any
series of debt securities then outstanding, which we refer to below as "legal
defeasance", or (b) to be released from our obligations under certain
restrictive covenants, including those described above under "Certain
Restrictive Covenants," which we refer to below as "covenant defeasance." To
make either of the above elections, we must:
. deposit in trust with the trustee, money, U.S. government obligations
which through the payment of principal and interest in accordance with
their terms will provide sufficient money without reinvestment or a
combination of money and U.S. government obligations to repay in full
the series of debt securities and any mandatory sinking fund payments;
. deliver to the trustee an opinion of counsel that holders of the series
of debt securities will not recognize income, gain or loss for federal
income tax purposes as a result of the deposit and related defeasance
and will be subject to federal income tax in the same amount, in the
same manner and at the same times as would have been the case if such
deposit and related defeasance had not occurred; and
. comply with certain other provisions.
Governing Law
The indenture and the debt securities will be governed by, and construed in
accordance with, the laws of the State of New York.
The Trustee
Norwest Bank Minnesota, N.A. is trustee under the indenture. The trustee
participates in our credit agreement and has other customary banking
relationships with us and our affiliates. The trustee is also a customer of
ours and purchases our products and services in the ordinary course of
business.
PLAN OF DISTRIBUTION
We may sell the debt securities (a) through underwriters or dealers; (b)
directly to one or a limited number of institutional purchasers; or (c) through
agents. This prospectus or the applicable prospectus supplement will set forth
the terms of the offering of any debt securities, including the name or names
of any underwriters, dealers or agents, the price of the offered securities and
the net proceeds to us from such sale, any underwriting commissions or other
items constituting underwriters' compensation.
If underwriters are used in the sale, the debt securities will be acquired
by the underwriters for their own account and may be resold from time to time
in one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale. The
debt securities may be offered to the public either through underwriting
syndicates represented by managing underwriters or directly by one or more
investment banking firms or others, as designated. Unless otherwise set forth
in the applicable prospectus supplement, the obligations of the underwriters or
agents to purchase the debt securities will be subject to certain conditions
precedent and the underwriters will be obligated to purchase all the debt
securities if any are purchased. Any initial public offering price and any
underwriting commissions or other items constituting underwriters' compensation
may be changed from time to time.
If a dealer is used in the sale of any debt securities, we will sell those
debt securities to the dealer, as principal. The dealer may then resell the
debt securities to the public at varying prices to be determined by the dealer
at the time of resale.
12
<PAGE>
We may sell debt securities directly to one or more institutional
purchasers, or through agents at a fixed price or prices, which may be changed,
or at varying prices determined at time of sale. Unless otherwise indicated in
the prospectus supplement, any agent will be acting on a reasonable efforts
basis for the period of its appointment.
If an applicable prospectus supplement indicates, we will authorize agents,
underwriters or dealers to solicit offers by certain specified institutions to
purchase debt securities from us at the public offering price set forth in the
prospectus supplement under delayed delivery contracts providing for payment
and delivery on a specified date in the future. These contracts will be subject
only to those conditions set forth in the prospectus supplement, and the
prospectus supplement will set forth the commission payable for solicitation of
the contracts.
The debt securities will be a new issue of securities with no established
trading market. Any underwriters or agents to or through whom debt securities
are sold by us for public offering and sale may make a market in the debt
securities. The underwriters or agents are not obligated to make a market in
the debt securities and may discontinue market making at any time without
notice. We cannot predict the liquidity of the trading market for any debt
securities.
Under agreements entered into with us, agents and underwriters who
participate in the distribution of the debt securities may be entitled to
indemnification by us against certain civil liabilities, including liabilities
under the Securities Act of 1933, or to contribution with respect to payments
which the agents or underwriters may be required to make. Agents and
underwriters may be customers of, engage in transactions with or perform
services for us in the ordinary course of business.
LEGAL MATTERS
The validity of the issuance of the debt securities will be passed upon for
us by Dorsey & Whitney LLP, Minneapolis, Minnesota, and, unless otherwise
indicated in the applicable prospectus supplement or prospectus supplements,
for any underwriters or agents by Oppenheimer Wolff & Donnelly LLP,
Minneapolis, Minnesota.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements and schedule included in our Annual Report on Form 10-K
for the year ended January 2, 1999, as set forth in their report, which is
incorporated by reference in this prospectus and elsewhere in the registration
statement. Our financial statements and schedule are incorporated by reference
in reliance on Ernst & Young LLP's report given on their authority as experts
in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION ABOUT JOSTENS
We file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms at 450 Fifth Street, N.W., Washington, D.C.,
20549; 7 World Trade Center, Suite 1300, New York, New York 10048; and Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511.
Please call the SEC at 1-800-SEC-0330 for further information on the public
reference rooms. Our SEC filings are also available to the public at the SEC's
web site at http://www.sec.gov. You may also obtain copies of our SEC filings
at The New York Stock Exchange, Inc., 20 Broad Street, New York, New York
10005.
The SEC allows us to "incorporate by reference" into this prospectus the
information we file with it, which means that we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be a part of this prospectus, and
later information filed
13
<PAGE>
with the SEC will update and supersede this information. We incorporate by
reference the documents listed below and any future filings made with the SEC
under Section 13(a), 13(c), 14, or 14(d) of the Securities Exchange Act of 1934
until our offering is completed:
(a) Annual Report on Form 10-K for the year ended January 2, 1999;
(b) Quarterly Report on Form 10-Q for the quarter ended April 3, 1999; and
(c) Current Report on Form 8-K, dated July 21, 1999.
You may request a copy of these filings, at no cost, by writing to or
telephoning us at the following address (or by visiting our website at
http://www.jostens.com):
Director--Investor Relations
Jostens, Inc.
5501 Norman Center Drive
Minneapolis, MN 55437
(612) 830-3332
You should rely only on the information incorporated by reference or
provided in this prospectus or the prospectus supplement. We have authorized no
one to provide you with different information. We are not making an offer of
these securities in any state where an offer is not permitted. You should not
assume that the information in this prospectus or the prospectus supplement is
accurate as of any date other than the date on the front of the document.
14
<PAGE>
[LOGO OF JOSTENS, INC.}
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The expenses in connection with the issuance and distribution of the
securities being registered, other than underwriting compensation, are:
<TABLE>
<S> <C>
Filing Fee for Registration Statement................................ $ 41,700
Legal Fees and Expenses.............................................. 85,000
Accounting Fees and Expenses......................................... 30,000
Trustee's Fees and Expenses.......................................... 10,000
Printing and Engraving Fees.......................................... 65,000
Rating Agency Fees................................................... 125,000
Miscellaneous........................................................ 15,300
---------
Total............................................................ $ 372,000
=========
</TABLE>
All of the above amounts, other than the Commission filing fee, are
estimates only.
Item 15. Indemnification of Directors and Officers.
Jostens Bylaws provide that Jostens shall indemnify its directors and
officers to the extent required or permitted by Minnesota Statutes or by other
provisions of law. Section 302A.521 of the Minnesota Statutes provides in
substance that, unless prohibited by its articles of incorporation or bylaws, a
corporation must indemnify an officer or director who is made or threatened to
be made a party to a proceeding because of his or her capacity as an officer or
director, against judgments, penalties and fines and reasonable expenses,
including attorneys' fees and disbursements incurred by such person in
connection with the proceeding, if certain criteria are met. These criteria,
all of which must be met by the person seeking indemnification, can be
summarized as follows: (a) that no other organization has indemnified such
person for the expenses for which indemnification is requested; (b) that such
person must have conducted himself or herself in good faith; (c) that no
improper personal benefits were obtained by such person and such person did not
engage in self-dealing; (d) that, in the case of a criminal proceeding, there
must have been no reasonable cause for such person to have believed that the
conduct was unlawful; and (e) that such person must have acted in a manner
reasonably believed to have been in the best interests of the corporation.
Provision is made in the statute for determinations as to eligibility for
indemnification. The determination is made by a majority of a quorum of the
corporation's Board of Directors who are at the time not a party to the
proceedings under consideration, or if no such quorum can be obtained, by a
majority of a committee of the Board, by special legal counsel selected by the
Board, obtained, by a majority of committee of the Board, by special legal
counsel selected by the Board, by the shareholders who are not parties to the
proceedings or by a court in the State of Minnesota.
Jostens maintains a standard policy of officers' and directors' liability
insurance.
In the Distribution Agreement, a form which is filed as Exhibit 1.1 hereto,
the Agents will agree to indemnify, under certain conditions, Jostens, its
directors, certain of its officers and persons who control Jostens within the
meaning of the Securities Act of 1933, against certain liabilities.
II-1
<PAGE>
Item 16. Exhibits.
The following Exhibits are filed as part of this Registration Statement:
<TABLE>
<CAPTION>
<C> <S>
*1.1 Form of Distribution Agreement.
*4.1 Form of Indenture, dated as of , 1999 between the Company and
Norwest Bank Minnesota, N.A., as Trustee.
4.2 Form of Debt Security (included in exhibit 4.1).
*5.1 Opinion of Dorsey & Whitney LLP.
*12 Computation of Ratios of Earnings to Fixed Charges.
*23.1 Consent of Ernst & Young LLP.
23.2 Consent of Dorsey & Whitney LLP (included as part of Exhibit 5).
24 Power of Attorney (included on signature page).
*25 Form T-1 Statement of Eligibility and Qualification of Trustee under the
Trust Indenture Act of 1939 for Norwest Bank Minnesota, N.A.
</TABLE>
- --------
* Filed herewith
Item 17. Undertakings.
(A) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement.
Provided, however, that paragraphs (A)(1)(i) and (A)(1)(ii) do not apply
if the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the Registrant
pursuant to section 13 or section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the registration statement.
II-2
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(B) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(C) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy, as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
(D) The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(E) The undersigned Registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act in accordance with the
rules and regulations prescribed by the Commission under Section 305(b)(2) of
the Trust Indenture Act.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant certifies
that it has reasonable grounds to believe that it meets all the requirements
for filing on Form S-3 and has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized in the City
of Minneapolis, State of Minnesota, on July 23, 1999.
JOSTENS, INC.
/s/ Robert C. Buhrmaster
By___________________________________
Robert C. Buhrmaster
Chairman of the Board, President
and Chief
Executive Officer
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that each person whose signature appears below
hereby constitutes and appoints Robert C. Buhrmaster and William N. Priesmeyer
and each of them (with full power to each of them to act alone) his or her true
and lawful attorneys-in-fact and agents, with full power of substitution, for
him or her and on his or her behalf and in his or her name, place and stead, in
any and all capacities to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with exhibits
and any and all other documents and instruments filed with respect thereto,
with the Securities and Exchange Commission (or any other governmental or
regulatory authority), granting unto said attorneys-in-fact and agents, and
each of them, full power and authority to do and to perform each and every act
and thing requisite and necessary to be done in and about the premises in order
to effectuate the same as fully as to all intents and purposes as he or she
might or could do if personally present, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or either of them or their or his
substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons in the capacities
indicated on the 23rd day of July, 1999.
Title
Signature
Chairman of the Board, President,
/s/ Robert C. Buhrmaster and Chief Executive Officer
_____________________________________ (Principal Executive Officer)
Robert C. Buhrmaster
/s/ William N. Priesmeyer Senior Vice President and Chief
_____________________________________ Financial Officer (Principal
William N. Priesmeyer Financial Officer)
/s/ Lilyan H. Affinito Director
_____________________________________
Lilyan H. Affinito
/s/ Mannie L. Jackson Director
_____________________________________
Mannie L. Jackson
/s/ Jack W. Eugster Director
_____________________________________
Jack W. Eugster
/s/ Richard A. Zona Director
_____________________________________
Richard A. Zona
/s/ Kendrick B. Melrose Director
_____________________________________
Kendrick B. Melrose
/s/ Brenda J. Lauderback Director
_____________________________________
Brenda J. Lauderback
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Number Description
------ -----------
<C> <S>
1.1 Form of Distribution Agreement
4.1 Form of Indenture, dated as of , 1999 between the Company
and Norwest Bank Minnesota, N.A., as Trustee
5.1 Opinion of Dorsey & Whitney LLP
12 Computation of Ratios of Earnings to Fixed Charges
23.1 Consent of Ernst & Young LLP
25 Form T-1 Statement of Eligibility and Qualification of Trustee under
the Trust Indenture Act of 1939 for Norwest Bank Minnesota, N.A.
</TABLE>
<PAGE>
Exhibit 1.1
$200,000,000
Jostens, Inc.
Medium-Term Notes
-----------------
DISTRIBUTION AGREEMENT
----------------------
_______________, 1999
Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, NY 10010-3629
Banc One Capital Markets, Inc.
One First National Plaza
Chicago, IL 60670
J. P. Morgan Securities Inc.
60 Wall Street
New York, NY 10260
Ladies and Gentlemen:
1. Introduction. Jostens, Inc., a Minnesota corporation (the "Issuer"),
confirms its agreement with each of you (individually, a "Distributor" and
collectively, the "Distributors") with respect to the issue and sale from time
to time by the Issuer of its medium-term notes registered under the registration
statement referred to in Section 2(a) (any such medium-term notes being
hereinafter referred to as the "Securities," which expression shall, if the
context so admits, include any permanent global Security). Securities may be
offered and sold pursuant to Section 3 of this Agreement in an aggregate amount
not to exceed the amount of Registered Securities (as defined in Section 2(a)
hereof) registered pursuant to such registration statement reduced by the
aggregate amount of any other Registered Securities sold otherwise than pursuant
to Section 3 of this Agreement. The Securities will be issued under an
indenture, dated as of __________, 1999 (the "Indenture"), between the Issuer
and Norwest Bank Minnesota, N.A., as trustee (the "Trustee").
The Securities shall have the terms described in the Prospectus
referred to in Section 2(a) as it may be amended or supplemented from time to
time, including any supplement to the Prospectus that sets forth only the terms
of a particular issue of the Securities (a "Pricing Supplement"). Securities
will be issued, and the terms thereof established, from time to time by the
Issuer in accordance with the Indenture and the Procedures (as defined in
Section 3(d) hereof).
<PAGE>
2. Representations and Warranties of the Issuer. The Issuer represents
and warrants to, and agrees with, each Distributor as follows:
(a) A registration statement (No. 333-_____), including a
prospectus, relating to $150,000,000 aggregate principal amount of debt
securities of the Issuer, and a registration statement (No. 33-40233)
relating to $50,000,000 aggregate principal amount of debt securities
of the Issuer, including the Securities (the "Registered Securities")
(including a prospectus which, as supplemented from time to time, shall
be used in connection with sales of the Securities) have been filed
with the Securities and Exchange Commission (the "Commission") and have
been declared effective under the Securities Act of 1933, as amended
(the "Act"). Such registration statements, as amended as of the Closing
Date (as defined in Section 3(e) hereof), are hereinafter collectively
referred to as the "Registration Statement," and the prospectus
included in registration statement no. 333-____________ as supplemented
so as generally to describe the Securities and the terms of the
offering of the Securities, including all material incorporated by
reference therein, is hereinafter referred to as the "Prospectus." Any
reference in this Agreement to amending or supplementing the Prospectus
shall be deemed to include the filing of materials incorporated by
reference in the Prospectus after the Closing Date and any reference in
this Agreement to any amendment or supplement to the Prospectus shall
be deemed to include any such materials incorporated by reference in
the Prospectus after the Closing Date.
(b) On the effective date of each part of the Registration
Statement, such Registration Statement conformed in all material
respects to the requirements of the Act, the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"), and the rules and
regulations of the Commission ("Rules and Regulations") and did not
include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, and on the Closing Date, and at each
of the times of acceptance and of delivery referred to in Section 6(a)
hereof and at each of the times of amendment or supplementing referred
to in Section 6(b) hereof (the Closing Date and each such time being
herein sometimes referred to as a "Representation Date"), each part of
the Registration Statement and the Prospectus as then amended or
supplemented will conform in all material respects to the requirements
of the Act, the Trust Indenture Act and the Rules and Regulations, and
neither of such documents will include any untrue statement of a
material fact or will omit to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, except that the foregoing does not apply to statements in
or omissions from any of such documents based upon written information
furnished to the Issuer by any Distributor specifically for use
therein.
(c) The Issuer has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Minnesota,
with power and authority (corporate and other) to own its properties
and conduct its business as described in the Prospectus; and the Issuer
is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such qualification
except where the failure to so qualify would not have a material
adverse effect on the business, financial condition, results of
operations or properties of the Issuer and its subsidiaries taken as a
whole (a "Material
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<PAGE>
Adverse Effect").
(d) Each subsidiary of the Issuer has been duly incorporated
and is an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus; and each subsidiary of the Issuer is duly qualified
to do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification except where the
failure to so qualify would not have a Material Adverse Effect; all of
the issued and outstanding capital stock of each subsidiary of the
Issuer has been duly authorized and validly issued and is fully paid
and nonassessable; and the capital stock of each subsidiary owned by
the Issuer, directly or through subsidiaries, is owned free from liens,
encumbrances and defects.
(e) The Indenture has been duly authorized, executed and
delivered by the Issuer and duly qualified under the Trust Indenture
Act and constitutes a valid and legally binding obligation of the
Issuer enforceable in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors'
rights and to general equity principles (regardless of whether
enforceability is considered in a proceeding at law or in equity); the
Securities have been duly authorized, and when the Securities have been
delivered and paid for pursuant to this Agreement, the Securities will
have been duly executed, authenticated, issued and delivered and will
conform in all material respects to the description thereof contained
in the Prospectus and will constitute valid and legally binding
obligations of the Issuer enforceable in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles
(regardless of whether enforceability is considered in a proceeding at
law or in equity).
(f) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
for the consummation of the transactions contemplated by this Agreement
in connection with the issuance and sale of the Securities by the
Issuer, except such as have been obtained and made under the Act and
the Trust Indenture Act and such as may be required under state
securities or Blue Sky laws.
(g) The execution, delivery and performance of the Indenture
and this Agreement do not, and the completion, execution and issuance
of each particular Security in accordance with the Indenture, the sale
by the Issuer of such Security in accordance with this Agreement and
compliance with the terms and provisions thereof will not, result in a
breach or violation of any of the terms and provisions of, or
constitute a default under, any statute, any rule, regulation or order
of any governmental agency or body or any court, domestic or foreign,
having jurisdiction over the Issuer or any subsidiary of the Issuer or
any of their properties, or any agreement or instrument to which the
Issuer or any such subsidiary is a party or by which the Issuer or any
such subsidiary is bound or to which any of the properties of the
Issuer or any such subsidiary is subject and which is material to the
issuer and its subsidiaries taken as a whole, or the
-3-
<PAGE>
charter or by-laws of the Issuer or any such subsidiary, and the Issuer
has full power and authority to authorize, issue and sell the
Securities as contemplated by this Agreement.
(h) This Agreement (including any agreement with respect to
the offering and sale of particular Securities as contemplated by
Section 3) has been duly authorized, executed and delivered by the
Issuer.
(i) Except as disclosed in the Prospectus, the Issuer and its
subsidiaries have good and marketable title to all real properties and
all other properties and assets owned by them, in each case free from
liens, encumbrances and defects that would materially affect the value
thereof or materially interfere with the use made or to be made thereof
by them; and except as disclosed in the Prospectus, the Issuer and its
subsidiaries hold any leased real or personal property under valid and
enforceable leases with no exceptions that would materially interfere
with the use made or to be made thereof by them.
(j) The Issuer and its subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the business now operated by
them and have not received any notice of proceedings relating to the
revocation or modification of any such certificate, authority or permit
that, if determined adversely to the Issuer or any of its subsidiaries,
would individually or in the aggregate have a Material Adverse Effect.
(k) No labor dispute with the employees of the Issuer or any
subsidiary exists or, to the knowledge of the Issuer, is imminent that
is reasonably likely to result in a Material Adverse Effect.
(l) The Issuer and its subsidiaries own, possess or can
acquire on reasonable terms, adequate trademarks, trade names and other
rights to inventions, know-how, patents, copyrights, confidential
information and other intellectual property (collectively,
"intellectual property rights") necessary to conduct the business now
operated by them, or presently employed by them, and have not received
any notice of infringement of or conflict with asserted rights of
others with respect to any intellectual property rights that, if
determined adversely to the Issuer or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect.
(m) Except as disclosed in the Prospectus, neither the Issuer
nor any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or any
court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or
restoration of the environment or human exposure to hazardous or toxic
substances (collectively, "environmental laws"), to the knowledge of
the Issuer owns or operates any real property contaminated with any
substance that is subject to any environmental laws, is liable for any
off-site disposal or contamination pursuant to any environmental laws,
or is subject to any claim relating to any environmental laws, which
violation, contamination, liability or claim would individually or in
the aggregate have a Material Adverse Effect; and the Issuer is not
aware of any pending investigation which might lead to such a claim.
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(n) Except as disclosed in the Prospectus, there are no
pending actions, suits or proceedings against or affecting the Issuer,
any of its subsidiaries or any of their respective properties that, if
determined adversely to the Issuer or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect, or
would materially and adversely affect the ability of the Issuer to
perform its obligations under the Indenture or this Agreement, or which
are otherwise material in the context of the sale of the Securities;
and, to the Issuer's knowledge, no such actions, suits or proceedings
are threatened or contemplated.
(o) The financial statements included or incorporated by
reference in the Registration Statement and Prospectus present fairly
the financial position of the Issuer and its consolidated subsidiaries
as of the dates shown and their results of operations and cash flows
for the periods shown, and such financial statements have been prepared
in conformity with U.S. generally accepted accounting principles
applied on a consistent basis; and the schedules included in the
Registration Statement present fairly the information required to be
stated therein.
(p) Except as disclosed in the Prospectus, since the date of
the latest audited financial statements included or incorporated by
reference in the Prospectus, there has been no material adverse change,
nor any development or event involving a prospective material adverse
change, in the financial condition, business, properties or results of
operations of the Issuer and its subsidiaries taken as a whole.
(q) The Issuer is not and, after giving effect to the offering
and sale of the Securities and the application of the proceeds thereof
as described in the Prospectus, will not be an "investment company," as
defined in the Investment Company Act of 1940.
(r) Neither the Issuer nor any of its affiliates does business
with the government of Cuba or with any person or affiliate located in
Cuba within the meaning of Section 517.075, Florida Statutes, and the
Issuer agrees to comply with such Section if prior to the completion of
the distribution of the Securities it commences doing such business.
(s) Immediately after any sale of Securities by the Issuer
hereunder or under any Terms Agreement, the aggregate amount of
Securities which shall have been issued and sold by the Issuer
hereunder or under any Terms Agreement and of any debt securities of
the Issuer (other than such Securities) that shall have been issued and
sold pursuant to the Registration Statement will not exceed the amount
of debt securities registered under the Registration Statement.
3. Appointment as Distributors; Agreement of Distributors;
Solicitations.
(a) (i) Subject to the terms and conditions stated herein, the
Issuer hereby appoints each of the Distributors as the agents of the
Issuer for the purpose of soliciting or receiving offers to purchase
the Securities to be issued by the Issuer during any Marketing Time.
For purposes of this Agreement "Marketing Time" shall mean any time
when no suspension of solicitation of offers to purchase Securities
pursuant to Section 3(c) or Section 4(c) shall be in effect or any time
when either any Distributor shall own
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any Securities with the intention of reselling them or the Issuer has
accepted an offer to purchase Securities but the related settlement has
not occurred.
(ii) So long as this Agreement shall remain in effect
with respect to any Distributor, the Issuer shall not, without the
consent of any such Distributor, solicit or accept offers to purchase
Securities otherwise than to or through one of the Distributors;
provided, however, that, subject to all of the terms and conditions of
this Agreement, the foregoing shall not be construed to prevent the
Issuer from selling at any time any Registered Securities in a firm
commitment underwriting pursuant to an underwriting agreement that does
not provide for a continuous offering of such Registered Securities;
and provided, further, that the Issuer reserves the right from time to
time (i) to solicit and accept offers to purchase Securities directly
from, and sell Securities directly to an investor, and (ii) to accept a
specific offer to purchase Securities solicited by a dealer other than
the Distributors (each an "Other Dealer"), without obtaining the prior
consent of any of the Distributors, provided that (x) the Issuer shall
give each of the Distributors notice of its decision to accept such an
offer to purchase Securities in advance of such acceptance, (y) any
Other Dealer shall agree to be bound by and subject to the terms and
conditions of this Agreement binding on the Distributors (including the
commission schedule set forth on Exhibit A), and (z) so long as this
Agreement remains in effect, the Issuer shall not, without the prior
written consent of the Distributors (which shall not be unreasonably
withheld), appoint any other agent or dealer for the purpose of
soliciting or receiving offers to purchase Securities on a continuous
basis. In the case of any sale of Securities by the Issuer directly to
an investor and not resulting from a solicitation made by any
Distributor, no commission will be payable with respect to such sale.
(b) (i) On the basis of the representations and warranties
contained herein, but subject to the terms and conditions herein set
forth, the each Distributor agrees, as an agent of the Issuer, to use
reasonable efforts when requested by the Issuer to solicit offers to
purchase the Securities upon the terms and conditions set forth in the
Prospectus, as from time to time amended or supplemented.
(ii) Unless otherwise expressly agreed by a
Distributor and the Issuer, such Distributor will solicit offers to
purchase Securities from the Issuer through such Distributor, acting as
agent, in accordance with the provisions of this Agreement. In such
event, such Distributor shall communicate to the Issuer, orally or in
writing, each reasonable offer to purchase Securities received by it as
agent; and the Issuer shall have the sole right to accept offers to
purchase the Securities and may reject any such offer, in whole or in
part. Each Distributor shall have the right, in its discretion
reasonably exercised, without notice to the Issuer, to reject any offer
to purchase Securities received by it as such agent, in whole or in
part, and any such rejection shall not be deemed a breach of its
agreement contained herein. At the time of delivery of, and payment
for, any Securities sold by the Issuer as a result of a solicitation
made by, or offer to purchase received by, a Distributor, acting on an
agency basis, the Issuer agrees to pay such Distributor a commission in
accordance with the schedule set forth in Exhibit A hereto.
(iii) No Distributor shall have any obligation to
purchase Securities from the Issuer; however, the Issuer and one or
more Distributors (each, a "Presenting
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Distributor") may agree from time to time that such Presenting
Distributor will purchase Securities as principal for resale to
investors and other purchasers selected by such Presenting
Distributors. If expressly agreed by the Issuer and the Presenting
Distributors, offers to sell Securities transmitted by the Distributors
and accepted by the Issuer may constitute acceptance of an offer to
sell such Securities to the Presenting Distributors for resale. Each
sale of Securities to a Distributor as principal shall be made in
accordance with the terms of this Agreement and (unless the Issuer and
the Presenting Distributors shall otherwise agree) a Terms Agreement,
in substantially the form of Exhibit B hereto (a "Terms Agreement"),
which will provide for the sale of such Securities to, and the purchase
and reoffering thereof by, the Distributor. In addition, if so
specified in a Terms Agreement executed by the Issuer and one or more
Presenting Distributors, such Presenting Distributors shall act as
representative or representatives of the several underwriters named in
such Terms Agreement for resale of the Securities specified in such
Terms Agreement upon the terms and subject to the conditions specified
in such Terms Agreement, this Agreement and in the Prospectus, as
supplemented by the applicable Pricing Supplement. It is understood
that the Distributors and any underwriters for which they may act as
representative propose that they will offer any Securities which they
agree to purchase as principal for sale as set forth in the Prospectus,
as supplemented by the applicable Pricing Supplement. Each purchase of
Securities by a Distributor as principal shall, unless otherwise
agreed, be at a discount from the principal amount of each such
Security equivalent to the applicable commission set forth in Exhibit A
hereto.
(iv) In the event a Distributor purchases Securities
as principal pursuant to Section 3(b)(iii), such Distributor is
authorized to engage the services of any other brokers or dealers in
connection with the offer or sale of such Securities and may reallow
any portion of the discount received from the Issuer to such brokers or
dealers. No Distributor shall offer or sell Securities on an agency
basis through any sub-agents without the consent of the Issuer, which
shall not be unreasonably withheld.
(v) No Distributor shall have any responsibility for
maintaining records with respect to the aggregate principal amount of
Securities sold, or otherwise monitoring the availability of Securities
for sale under the Registration Statement.
(vi) No Security which the Issuer has agreed to sell
pursuant to this Agreement shall be deemed to have been purchased and
paid for, or sold by the Issuer, until such Security shall have been
delivered to the purchaser thereof against payment by such purchaser.
(c) Upon receipt of notice from the Issuer as contemplated by
Section 4(c) hereof, each Distributor shall suspend its solicitation of
offers to purchase Securities until such time as the Issuer shall have
furnished it with an amendment or supplement to the Registration
Statement or the Prospectus, as the case may be, contemplated by
Section 4(c) and shall have advised such Distributor that such
solicitation may be resumed.
The Issuer reserves the right, in its sole
discretion, to suspend solicitation of offers to purchase the
Securities commencing at any time for any period of
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time or permanently. Upon receipt of at least one Business Day's prior
notice from the Issuer, the Distributors will forthwith suspend
solicitation of offers to purchase Securities from the Issuer until
such time as the Issuer has advised the Distributors that such
solicitation may be resumed. For the purpose of the foregoing sentence,
"Business Day" shall mean any day that is not a Saturday or Sunday, and
that in The City of New York is not a day on which banking institutions
generally are authorized or obligated by law or executive order to
close. During such period, the Issuer shall not be required to comply
with the provisions of Sections 6(b), (c) and (d). Upon advising the
Distributors that such solicitation may be resumed, however, the Issuer
shall simultaneously provide the documents required to be delivered by
Sections 6(b), (c) and (d) as if the date of resumption were a
Representation Date, and the Distributors shall have no obligation to
solicit offers to purchase the Securities until such documents have
been received by them.
(d) Administrative procedures respecting the sale of
Securities (the "Procedures") shall be agreed upon from time to time by
the Distributors and the Issuer. The initial Procedures, which are set
forth in Exhibit C hereto, shall remain in effect until changed by
agreement among the Issuer and the Distributors. Each Distributor and
the Issuer agree to perform the respective duties and obligations
specifically provided to be performed by each of them herein and in the
Procedures. The Issuer will furnish to the Trustee a copy of the
Procedures as from time to time in effect.
(e) The documents required to be delivered by Section 5 hereof
shall be delivered at the office of ___________________,
______________________________, not later than 10:00 A.M., New York
City time, on the date of this Agreement or at such later time as may
be mutually agreed by the Issuer and the Distributors, which in no
event shall be later than the time at which the Distributors commence
solicitation of purchases of Securities hereunder, such time and date
being herein called the "Closing Date." For purposes of Rule 15c6-1
under the Securities Exchange Act of 1934, the settlement date (if
later than the otherwise applicable settlement date) shall be the date
for payment of funds and delivery of securities for all the Securities
sold pursuant to an offering of Securities having identical terms
(including the issue date) and terms of sale (whether or not set forth
in a single Terms Agreement).
4. Certain Agreements of the Issuer. The Issuer agrees with the
Distributors that it will furnish to Oppenheimer Wolff & Donnelly LLP, counsel
for the Distributors, one signed copy of the Registration Statement, including
all exhibits, in the form it became effective and of all amendments thereto and
that, in connection with each offering of Securities,
(a) The Issuer will prepare a Pricing Supplement with respect
to any Securities to be offered and sold to or through one or more
Distributors pursuant to this Agreement and, after approval of such
Pricing Supplement by such Distributor or Distributors, will file such
Pricing Supplement with the Commission pursuant to and in accordance
with Rule 424(b) under the Act.
(b) The Issuer will advise each Distributor promptly of any
proposal to amend or supplement the Registration Statement or the
Prospectus and will afford the Distributors a reasonable opportunity to
comment on any such proposed amendment or
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supplement (other than any Pricing Supplement that relates to
Securities not purchased through or by such Distributor), and if the
Issuer effects any amendment or supplementation of the Registration
Statement or the Prospectus to which a Distributor objects, such
Distributor shall be relieved of its obligations under Section 3(b) to
solicit offers to purchase Securities until such time as the Issuer
shall have filed such further amendments or supplements such that such
Distributor is reasonably satisfied with the Registration Statement and
the Prospectus, as then amended or supplemented; and the Issuer will
also advise each Distributor promptly of the filing and effectiveness
of any such amendment or supplement and of the institution by the
Commission of any stop order proceedings in respect of the Registration
Statement or of any part thereof and will use commercially reasonable
efforts to prevent the issuance of any such stop order and to obtain as
soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus, as then amended or supplemented,
would include an untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or if it is necessary at any
such time to amend the Prospectus to comply with the Act, the Issuer
will promptly notify each Distributor by telephone (with confirmation
in writing) to suspend solicitation of offers to purchase the
Securities and to cease making offers or sales of Securities which a
Distributor may then own as principal; and if the Issuer shall decide
to amend or supplement the Registration Statement or the Prospectus, it
will promptly advise each Distributor by telephone (with confirmation
in writing) and, subject to the provisions of subsection (a) of this
Section, will promptly prepare and file with the Commission an
amendment or supplement which will correct such statement or omission
or an amendment which will effect such compliance. Notwithstanding the
foregoing, if, at the time any such event occurs or it becomes
necessary to amend the Prospectus to comply with the Act, any
Distributor shall own any of the Securities with the intention of
reselling them, or the Issuer has accepted an offer to purchase
Securities but the related settlement has not occurred, the Issuer,
subject to the provisions of subsection (a) of this Section, will
promptly prepare and file with the Commission an amendment or
supplement which will correct such statement or omission or an
amendment which will effect such compliance. Neither the Distributors'
consent to, nor their delivery of, any such amendment or supplement
shall constitute a waiver of any of the conditions set forth in Section
5.
(d) The Issuer will file promptly all documents required to be
filed with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act. In addition, on or prior to the date on which the
Issuer makes any announcement to the general public concerning earnings
or concerning any other event which is required to be described, or
which the Issuer proposes to describe, in a document filed pursuant to
the Exchange Act, the Issuer will furnish the information contained or
to be contained in such announcement to each Distributor or will notify
each Distributor of the availability thereof. At any time when a
prospectus relating to the Securities is required to be delivered under
the Act, the Issuer will, subject to the provisions of subsections (a)
and (b) of this Section, promptly cause the Prospectus to be amended or
supplemented to reflect the information contained in any such
announcement made (i) during such time or
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(ii) prior to such time and not yet incorporated by reference into the
Prospectus as of such time. The Issuer also will furnish each
Distributor with copies of all press releases or announcements to the
general public or will notify each Distributor of the availability
thereof.
(e) The Issuer will notify each Distributor as soon as
practicable (but in any case before any offer to purchase Securities is
accepted by the Issuer) of any downgrading in the rating of any debt
securities of the Issuer or any proposal to downgrade the rating of any
debt securities of the Issuer by any "nationally recognized statistical
rating organization" (as defined for purposes of Rule 436(g) under the
Act), or any public announcement that any such organization has under
surveillance or review its rating of any debt securities of the Issuer
(other than an announcement with positive implications of a possible
upgrading, and no implication of a possible downgrading of such
rating), as soon as the Issuer learns of such downgrading, proposal to
downgrade or public announcement.
(f) As soon as practicable, but not later than 16 months,
after the effective date of the Registration Statement (as defined in
Rule 158(c) under the Act), the Issuer will make generally available to
its securityholders an earnings statement which will satisfy the
provisions of Section 11(a) of the Act.
(g) At any time when a prospectus relating to the Securities
is required to be delivered under the Act, the Issuer will furnish to
each Distributor copies of the Registration Statement, including all
exhibits, any related preliminary prospectus, any related preliminary
prospectus supplement, the Prospectus and all amendments and
supplements to such documents (including any Pricing Supplement), in
each case as soon as available and in such quantities as are reasonably
requested.
(h) The Issuer will arrange for the qualification of the
Securities for sale and the determination of their eligibility for
investment under the laws of such states and other jurisdictions in the
United States as the Distributors designate (or in such foreign
jurisdiction as the Issuer and any Distributor may mutually agree) and
will continue such qualifications in effect so long as required for the
distribution; provided, however, that the Issuer shall not be obligated
to file any general consent to service of process or to qualify as a
foreign corporation in any jurisdiction in which it is not so
qualified.
(i) So long as any Securities are outstanding, the Issuer will
furnish to the Distributors (or notify the Distributors of the
availability of), (i) as soon as practicable after the end of each
fiscal year, a copy of its annual report to stockholders for such year,
(ii) as soon as available, a copy of each report or definitive proxy
statement of the Issuer filed with the Commission under the Exchange
Act or mailed to stockholders, and (iii) from time to time, such other
information concerning the Issuer as the Distributors may reasonably
request.
(j) The Issuer will pay, or reimburse each Distributor for,
(i) the fees, disbursements and expenses of the Issuer's counsel and
accountants in connection with the registration of the Securities under
the Act and all other expenses in connection with the preparation,
printing and filing of the Registration Statement, any Preliminary
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Prospectus, the Prospectus and any Pricing Supplements and all other
amendments and supplements thereto and the mailing and delivering of
copies thereof to such Distributor; (ii) the reasonable fees,
disbursements and expenses of counsel for the Distributors in
connection with the establishment of the program contemplated hereby,
any opinions to be rendered by such counsel hereunder and under any
Terms Agreement and the transactions contemplated hereunder and under
any Terms Agreement; (iii) the cost of printing, producing or
reproducing this Agreement, any Terms Agreement, any Indenture, any
Blue Sky and Legal Investment Memoranda, closing documents (including
any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Securities; (iv) all
expenses in connection with the qualification of the Securities for
offering and sale under state securities laws as provided in Section
4(b) hereof, including the fees and disbursements of counsel for the
Issuer in connection with such qualification and in connection with the
Blue Sky and legal investment surveys; (v) any fees charged by
securities rating services for rating the Securities; (vi) any filing
fees incident to, and the reasonable fees and disbursements of counsel
for the Distributors in connection with, any required review by the
National Association of Securities Dealers, Inc. of the terms of the
sale of the Securities; (vii) the cost of preparing the Securities;
(viii) the fees and expenses of any Trustee and any Distributor of any
Trustee and any transfer or paying agent of the Issuer and the fees and
disbursements of counsel for any Trustee or such agent in connection
with any Indenture and the Securities; (ix) any advertising expenses
connected with the solicitation of offers to purchase and the sale of
Securities so long as such advertising expenses have been approved by
the Issuer; and (x) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise
specifically provided for in this Section. Except as provided in
Sections 7 and 8 of this Agreement, each Distributor shall pay all
other expenses it incurs.
(k) Between the date on which any Distributor agrees to
purchase Securities from the Issuer as principal for resale and the
date of delivery of such Securities, the Issuer will not, without the
prior written consent of such Distributor, offer or sell, or enter into
any agreement to sell, pledge, or otherwise dispose of, directly or
indirectly, or file with the Commission a registration statement under
the Act relating to any of its debt securities (other than such
Securities) in the United States, other than borrowings under the
Issuer's revolving credit agreements and lines of credit, the private
placement of securities and issuances of its commercial paper, or
publicly disclose the intention to make any such offer, sale, pledge or
disposition or filing.
5. Conditions of Obligations. The obligations of each Distributor, as
agent of the Issuer, under this Agreement at any time to solicit offers to
purchase the Securities and to purchase Securities from the Issuer as principal
is subject to the accuracy, on the date hereof, on each Representation Date and
on the date of each such solicitation, of the representations and warranties of
the Issuer herein, to the accuracy, on each such date, of the statements of the
Issuer's officers made pursuant to the provisions hereof, to the performance, on
or prior to each such date, by the Issuer of its obligations hereunder, and to
each of the following additional conditions precedent:
(a) The Prospectus, as amended or supplemented as of any
Representation Date or date of such solicitation, as the case may be,
shall have been filed with the
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Commission in accordance with the Rules and Regulations and no stop
order suspending the effectiveness of the Registration Statement or of
any part thereof shall have been issued and no proceedings for that
purpose shall have been instituted or, to the knowledge of the Issuer
or any Distributor, shall be contemplated by the Commission.
(b) Neither the Registration Statement nor the Prospectus, as
amended or supplemented as of any Representation Date or date of such
solicitation, as the case may be, shall contain any untrue statement of
fact which, in the opinion of any Distributor, is material or omits to
state a fact which, in the opinion of any Distributor, is material and
is required to be stated therein or is necessary to make the statements
therein not misleading.
(c) There shall not have occurred (i) any change, or any
development or event involving a prospective change, in the financial
condition, business, properties or results of operations of the Issuer
or its subsidiaries which, in the judgment of a majority of the
Distributors, is material and adverse and makes it impractical or
inadvisable to proceed with completion of the public offering or the
sale of and payment for the Securities; (ii) any downgrading in the
rating of any debt securities of the Issuer by any "nationally
recognized statistical rating organization" (as defined for purposes of
Rule 436(g) under the Act), or any public announcement that any such
organization has under surveillance or review its rating of any debt
securities of the Issuer (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (iii) any suspension or limitation of
trading in securities generally on the New York Stock Exchange, or any
setting of minimum prices for trading on such exchange, or any
suspension of trading of any securities of the Issuer on any exchange
or in the over-the-counter market; (iv) any banking moratorium declared
by U.S. Federal or, New York authorities; or (v) any outbreak or
escalation of major hostilities in which the United States is involved,
any declaration of war by Congress or any other substantial national or
international calamity or emergency if, in the judgment of a majority
of the Distributors, the effect of any such outbreak, escalation,
declaration, calamity or emergency makes it impractical or inadvisable
to proceed with solicitations of offers to purchase, or sales of,
Securities.
(d) With respect to any Security denominated in a currency
other than the U.S. dollar, more than one currency or a composite
currency or any Security the principal or interest of which is indexed
to such currency, currencies or composite currency, there shall not
have occurred a suspension or material limitation in foreign exchange
trading in such currency, currencies or composite currency by a major
international bank, a general moratorium on commercial banking
activities in the country or countries issuing such currency,
currencies or composite currency, the outbreak or escalation of
hostilities involving, the occurrence of any material adverse change in
the existing financial, political or economic conditions of, or the
declaration of war or a national emergency by, the country or countries
issuing such currency, currencies or composite currency or the
imposition or proposal of exchange controls by any governmental
authority in the country or countries issuing such currency, currencies
or composite currency;
(e) At the Closing Date and, if specified in a Terms
Agreement, if any, at
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the time of delivery of the Securities described in such Terms
Agreement, the Distributors or the Distributor purchasing such
Securities pursuant to such Terms Agreement (the "Purchasing
Distributor"), as the case may be, shall have received an opinion,
dated the Closing Date, or such date of delivery, as the case may be,
of Dorsey & Whitney LLP counsel for the Issuer, to the effect that:
(i) The Issuer has been duly incorporated and is an
existing corporation in good standing under the laws of the State of
Minnesota, with corporate power to own its properties and conduct its
business as described in the Prospectus;
(ii) The Indenture has been duly authorized, executed
and delivered by the Issuer and has been duly qualified under the Trust
Indenture Act and constitutes a valid and binding obligation of the
Issuer enforceable in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors'
rights and to general equity principles;
(iii) Any series of Securities established on or
prior to the date of such opinion has been duly authorized and
established in conformity with the Indenture, and, when the terms of a
particular Security and of its issuance and sale have been duly
authorized and established by all necessary corporate action in
conformity with the Indenture, and such Security has been duly
completed, executed, authenticated and issued in accordance with the
Indenture and delivered against payment as contemplated by this
Agreement, such Security will constitute a valid and binding obligation
of the Issuer enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles, it being understood
that such counsel may (a) assume that at the time of the issuance, sale
and delivery of each Security the authorization of such series will not
have been modified or rescinded and there will not have occurred any
change in law affecting the validity, legally binding character or
enforceability of such Security, (b) assume that neither the issuance,
sale and delivery of any Security, nor any of the terms of such
Security, nor compliance by the Issuer with such terms, will violate
any applicable law, any agreement or instrument then binding upon the
Issuer or any restriction imposed by any court or governmental body
having jurisdiction over the Issuer, and (c) state that as of the date
of such opinion a judgment for money in an action based on Securities
denominated in foreign currencies or currency units in a Federal or
State court in the United States ordinarily would be enforced in the
United States only in United States dollars, and that the date used to
determine the rate of conversion of the foreign currency or currency
unit in which a particular Security is denominated into United States
dollars will depend upon various factors, including which court renders
the judgment;
(iv) The Registration Statement has become effective
under the Act, the Prospectus was filed with the Commission pursuant to
the subparagraph of Rule 424(b) under the Act specified in such opinion
on the date specified therein, and, to the best of the knowledge of
such counsel, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the knowledge of such counsel, are
pending or contemplated under the
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Act.
(v) The Registration Statement, as of its effective
date, the Registration Statement and the Prospectus, as of the Closing
Date, and any amendment or supplement thereto made by the Issuer prior
to the date of such opinion, as of its respective date, complied as to
form in all material respects with the requirements of the Act, the
Trust Indenture Act and the Rules and Regulations; the descriptions in
the Registration Statement and the Prospectus of statutes, legal and
governmental proceedings and contracts and other documents are accurate
and fairly present the information required to be shown; and such
counsel do not know of any legal or governmental proceedings required
to be described in the Prospectus which are not described as required
or of any contracts or documents of a character required to be
described in the Registration Statement or the Prospectus or to be
filed as exhibits to the Registration Statement which are not described
and filed as required; it being understood that such counsel need
express no opinion as to the financial statements or other financial
data contained in the Registration Statement or the Prospectus;
(vi) No consent, approval, authorization or order of,
or filing with, any governmental agency or body or any court is
required to be obtained or made by the Issuer for the consummation of
the transactions contemplated by this Agreement in connection with the
issuance and sale of the Securities by the Issuer, except such as have
been obtained and made under the Act and the Trust Indenture Act and
such as may be required under state securities laws (it being
understood that such counsel may assume with respect to each particular
Security that the inclusion of any alternative or additional terms in
such Security that are not currently specified in the draft forms of
Securities examined by such counsel would not require the Issuer to
obtain any regulatory consent, authorization or approval or make any
regulatory filing in order for the Issuer to issue, sell and deliver
such Security);
(vii) The execution, delivery and performance of the
Indenture, this Agreement and the issuance and sale of the Securities,
and compliance with the terms and provisions thereof, will not result
in a breach or violation of any of the terms and provisions of, or
constitute a default under, any applicable statute, any rule,
regulation or order of any governmental agency or body or any court
having jurisdiction over the Issuer or any subsidiary of the Issuer or
any of their properties or any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument pursuant to which the
Company has indebtedness outstanding and which is material to the
financial condition, business, properties or results of operations of
the Issuer or its subsidiaries taken as a whole or the charter or by-
laws of the Issuer or any such subsidiary, and the Issuer has full
power and authority to authorize, issue and sell the Securities as
contemplated by this Agreement (it being understood that such counsel
may assume with respect to each particular Security that the inclusion
of any alternative or additional terms in such Security that are not
currently specified in the draft forms of Securities examined by such
counsel will not cause the issuance, sale or delivery of such Security,
the terms of such Security, or the compliance by the Issuer with such
terms, to violate any of the court orders or laws specified in this
paragraph or to result in a default under or a breach of any of the
agreements specified in this paragraph); and
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(viii) This Agreement has been duly authorized,
executed and delivered by the Issuer.
Such opinion shall also state that, although such counsel does
not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or
the Prospectus, based upon conferences with officers of the Issuer,
examination of documents referred to in the Registration Statement and
the Prospectus and such other procedures as such counsel deemed
appropriate, nothing has come to such counsel's attention that causes
such counsel to believe that, as of its effective date, the
Registration Statement or any further amendment or supplement thereto
made by the Issuer prior to the date of such opinion (other than the
financial statements, related schedules and other financial data
therein, as to which such counsel need make no statement) contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that, as of the date of such opinion, the
Prospectus as amended or supplemented or any further amendment or
supplement thereto made by the Issuer prior to the date of such opinion
(other than the financial statements, related schedules and other
financial data therein, as to which such counsel need make no
statement) contained an untrue statement of a material fact or omitted
to state a material fact necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading.
In the case of each such opinion delivered pursuant to a Terms
Agreement, (x) the statements contained in such opinion relating to the
Registration Statement or the Prospectus shall relate to the
Registration Statement or the Prospectus, as the case may be, as amended
or supplemented as of the date of the Issuer's acceptance of the offer
to purchase such Securities and as of the time of delivery of such
Securities; (y) such opinion shall relate to the Securities being
delivered on the date of such opinion and not to other Securities as
well; and (z) shall state that the Securities being delivered on the
date of such opinion, when delivered against payment therefor as
contemplated by this Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Issuer enforceable in accordance with
their terms, subject only to the exceptions set forth in clause (iii) as
to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or
affecting creditors' rights and general equity principles, and will
conform to the description thereof contained in the Prospectus as
amended or supplemented at such date of delivery.
(f) At the Closing Date and, if specified in a Terms
Agreement, if any, at the time of delivery of the Securities described
in such Terms Agreement, the Distributors or the Presenting
Distributor, as the case may be, shall have received a certificate,
dated the Closing Date or such date of delivery, as the case may be, of
the President or any Vice President and a principal financial or
accounting officer of the Issuer in which such officers, to the best of
their knowledge after reasonable investigation, shall state that the
representations and warranties of the Issuer in this Agreement are true
and correct, that the Issuer has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date or such date of delivery, as
the case may be, that no stop order suspending
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the effectiveness of the Registration Statement or of any part thereof
has been issued and no proceedings for that purpose have been
instituted or are contemplated by the Commission, and that subsequent
to the date of the most recent financial statements included or
incorporated by reference in the Prospectus, there has been no material
adverse change, nor any development or event involving a prospective
material adverse change, in the financial condition, business,
properties or results of operations of the Issuer and its subsidiaries
taken as a whole, except as set forth in or contemplated by the
Prospectus or as described in such certificate. In the case of each
such certificate delivered pursuant to a Terms Agreement, the
statements contained in such certificate relating to the Registration
Statement or the Prospectus shall relate to the Registration Statement
or the Prospectus, as the case may be, as amended or supplemented as of
the date of the Issuer's acceptance of the offer to purchase such
Securities and as of the time of delivery of such Securities.
(g) At the Closing Date and, if specified in a Terms
Agreement, if any, at the time of delivery of the Securities described
in such Terms Agreement, the Distributors or the Purchasing
Distributor, as the case may be, shall have received a letter, dated
the Closing Date or such date of delivery, as the case may be, of Ernst
& Young LLP (or another nationally recognized firm of independent
public accountants), confirming that they are independent public
accountants within the meaning of the Act and the applicable published
Rules and Regulations thereunder and stating to the effect that:
(i) in their opinion, the financial statements and
schedules, if any, examined by them and included in the Prospectus
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published Rules and
Regulations;
(ii) they have performed the procedures specified by
the American Institute of Certified Public Accountants for a review of
interim financial information as described in Statement of Auditing
Standards No. 71, Interim Financial Information, on any unaudited
financial statements included or incorporated by reference in the
Registration Statement;
(iii) on the basis of the review, if any, referred to
in clause (ii) above, a reading of the latest available interim
financial statements of the Issuer, inquiries of officials of the
Issuer who have responsibility for financial and accounting matters and
other specified procedures, nothing came to their attention that caused
them to believe that:
(A) the unaudited financial statements, if any, and
any summary of earnings included in the Prospectus do not
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published
Rules and Regulations or any material modifications should be
made to such unaudited financial statements for them to be in
conformity with generally accepted accounting principles;
(B) if any unaudited "capsule" information is
contained in the
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Prospectus, the unaudited consolidated net sales, operating
income, net income and net earnings per share amounts or
certain other amounts as agreed by the Issuer and the
Distributor constituting such "capsule" information and
described in such letter for the three-, six- and nine-month
periods ended April 3, July 3 and October 3, respectively,
included in the Prospectus, as applicable, do not agree with
the corresponding amounts set forth in the unaudited
consolidated financial statements for those same periods or
were not determined on a basis substantially consistent with
that of the corresponding amounts in the audited statements of
income;
(C) at the date of the latest available balance sheet
read by such accountants, or at a subsequent specified date
not more than five business days prior to the date of this
Agreement, there was any change in the capital stock or any
increase in short-term indebtedness or long-term debt of the
Issuer and its consolidated subsidiaries or, at the date of
the latest available balance sheet read by such accountants,
there was any decrease in consolidated net assets, as compared
with amounts shown on the latest balance sheet included in the
Prospectus; or
(D) for the period from the closing date of the
latest available income statement included in the Prospectus
to the closing date of the latest available income statement
read by such accountants there were any decreases, as compared
with the corresponding period of the previous year and with
the period of corresponding length ended the date of the
latest income statement included in the Prospectus, in
consolidated net sales, operating income or in the ratio of
earnings to fixed charges;
except in all cases set forth in clauses (C) and (D) above, for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in the Registration Statement (in each case to
the extent that such dollar amounts, percentages and other financial
information are derived from the general accounting records of the
Issuer and its subsidiaries subject to the internal controls of the
Issuer's accounting system or are derived directly from such records by
analysis or computation) with the results obtained from inquiries, a
reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
All financial statements and schedules included in
material incorporated by reference into the Prospectus shall be deemed
included in the Prospectus for purposes of this subsection.
In the case of each such letter delivered pursuant to
a Terms Agreement, the statements contained in such letter relating to
the Registration Statement or the
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Prospectus shall relate to the Registration Statement or the
Prospectus, as the case may be, as amended or supplemented as of the
date of the Issuer's acceptance of the offer to purchase such
Securities and as of the time of delivery of such Securities.
(h) At the Closing Date and, if specified in a Terms
Agreement, if any, at the time of delivery of the Securities described
in such Terms Agreement, the Distributors or the Purchasing
Distributor, as the case may be, shall have received from Oppenheimer
Wolff & Donnelly LLP, counsel for the Distributors, such opinion or
opinions, dated the Closing Date or such date of delivery, as the case
may be, with respect to the incorporation of the Issuer, the validity
of the Securities, the Registration Statement, the Prospectus and other
related matters as the Distributors or the Purchasing Distributor, as
the case may be, may require, and the Issuer shall have furnished to
such counsel such documents as they request for the purpose of enabling
them to pass upon such matters.
(i) The Issuer shall have furnished to the Distributors or
their counsel such further certificates and documents as the
Distributors or such counsel shall reasonably request.
The Issuer will furnish the Distributors with such conformed copies of
such opinions, certificates, letters and documents as they reasonably request.
6. Additional Covenants of the Issuer. The Issuer agrees that:
(a) Each acceptance by the Issuer of an offer for the purchase
of Securities shall be deemed to be an affirmation that its
representations and warranties contained in this Agreement are true and
correct at the time of such acceptance and a covenant that such
representations and warranties will be true and correct at the time of
delivery to the purchaser of the Securities as though made at and as of
each such time, it being understood that such representations and
warranties shall relate to the Registration Statement and the
Prospectus as amended or supplemented at each such time. Each such
acceptance by the Issuer of an offer to purchase Securities shall be
deemed to constitute an additional representation, warranty and
agreement by the Issuer that, as of the date of delivery of such
Securities to the purchaser thereof, after giving effect to the
issuance of such Securities, of any other Securities to be issued on or
prior to such delivery date and of any other Registered Securities to
be issued and sold by the Issuer on or prior to such delivery date, the
aggregate amount of Registered Securities (including any Securities)
which have been issued and sold by the Issuer will not exceed the
amount of Registered Securities registered pursuant to the Registration
Statement.
(b) On each Representation Date on which the Registration
Statement or the Prospectus shall be amended or supplemented (other
than by a Pricing Supplement or by an amendment or supplement relating
solely to the terms of the Securities or a change in the principal
amount of Securities remaining to be sold or similar changes) or by an
amendment or supplement relating solely to the terms of the Securities
or a change in the principal amount of Securities remaining to be sold
or similar changes, the Issuer shall, (A) concurrently with such
amendment or supplement, if such amendment or supplement shall occur at
a Marketing Time, or (B) immediately at the next Marketing Time if such
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amendment or supplement shall not occur at a Marketing Time, furnish
the Distributors with a certificate, dated the date of delivery
thereof, of the President or any Vice President and a principal
financial or accounting officer of the Issuer, in form satisfactory to
the Distributors, to the effect that the statements contained in the
certificate covering the matters set forth in Section 5(f) hereof which
was last furnished to the Distributors pursuant to this Section 6(b)
are true and correct at the time of such amendment or supplement, as
though made at and as of such time or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in Section
5(f); provided, however, that any certificate furnished under this
Section 6(b) shall relate to the Registration Statement and the
Prospectus as amended or supplemented at the time of delivery of such
certificate and, in the case of the matters set forth in clause (ii) of
Section 5(f), to the time of delivery of such certificate.
(c) At each Representation Date referred to in Section 6(b),
the Issuer shall, (A) concurrently if such Representation Date shall
occur at a Marketing Time, or (B) immediately at the next Marketing
Time if such Representation Date shall not occur at a Marketing Time,
furnish the Distributors with a written opinion or opinions, dated the
date of such Representation Date, of counsel for the Issuer, in form
satisfactory to the Distributors, to the effect set forth in Section
5(e) hereof; provided, however, that to the extent appropriate such
opinion or opinions may reconfirm matters set forth in a prior opinion
delivered at the Closing Date or under this Section 6(c); provided
further, however, that any opinion or opinions furnished under this
Section 6(c) shall relate to the Registration Statement and the
Prospectus as amended or supplemented at such Representation Date and
shall state that the Securities sold in the relevant Applicable Period
(as defined below) have been duly executed, authenticated, issued and
delivered and constitute valid and legally binding obligations of the
Issuer enforceable in accordance with their terms, subject only to the
exceptions set forth in clause (iii) of Section 5(e) hereof as to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and general equity principles, and conform to the
description thereof contained in the Prospectus as amended or
supplemented at the relevant date or dates for the delivery of such
Securities to the purchaser or purchasers thereof. For the purpose of
this Section 6(c), "Applicable Period" shall mean with respect to any
opinion delivered on a Representation Date the period commencing on the
date as of which the most recent prior opinion delivered at the Closing
Date or under this Section 6(c) speaks and ending on such
Representation Date.
(d) At each Representation Date referred to in Section 6(b) on
which the Registration Statement or the Prospectus shall be amended or
supplemented to include additional financial information, the Issuer
shall cause Ernst & Young LLP, (A) concurrently if such Representation
Date shall occur at a Marketing Time, or (B) immediately at the next
Marketing Time if such Representation Date shall not occur at a
Marketing Time, to furnish the Distributors with a letter, addressed
jointly to the Issuer and the Distributors and dated the date of such
Representation Date, in form and substance satisfactory to the
Distributors, to the effect set forth in Section 5(g) hereof; provided,
however, that to the extent appropriate such letter may reconfirm
matters set forth in a prior letter delivered at the Closing Date or
pursuant to this Section 6(d); provided further, however, that any
letter furnished under this Section 6(d) shall relate to
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the Registration Statement and the Prospectus as amended or
supplemented at such Representation Date, with such changes as may be
necessary to reflect changes in the financial statements and other
information derived from the accounting records of the Issuer.
(e) On each date for the delivery of Securities to a
Distributor as principal, the Issuer shall, if specified in the
applicable Terms Agreement, furnish such Distributor with a written
opinion or opinions, dated the date of delivery thereof, of counsel for
the Issuer, in form satisfactory to such Distributor, to the effect set
forth in clauses (i), (ii) and (iii) of Section 5(e) hereof; provided,
however, that any opinion furnished under this Section 6(e) shall
relate to the Prospectus as amended or supplemented at such delivery
date and shall state that the Securities being sold by the Issuer on
such delivery date, when delivered against payment therefor as
contemplated by this Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Issuer enforceable in accordance
with their terms, subject only to the exceptions set forth in clause
(iii) of Section 5(e) hereof as to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and general
equity principles, and will conform to the description thereof
contained in the Prospectus as amended or supplemented at such
settlement date.
(f) The Issuer agrees that any obligation of a person who has
agreed to purchase Securities to make payment for and take delivery of
such Securities shall be subject to (i) the accuracy, on the related
settlement date fixed pursuant to the Procedures, of the Issuer's
representation and warranty deemed to be made to the Distributors
pursuant to the last sentence of subsection (a) of this Section 6, and
(ii) the satisfaction, on such settlement date, of each of the
conditions set forth in Sections 5(a), (b) and (c), it being understood
that under no circumstance shall any Distributor have any duty or
obligation to exercise the judgment permitted under Section 5(b) or (c)
on behalf of any such person.
7. Indemnification and Contribution.
(a) The Issuer will indemnify and hold harmless each
Distributor against any losses, claims, damages or liabilities, joint
or several, to which such Distributor may become subject, under the Act
or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus
or preliminary prospectus supplement, or arise out of or are based upon
the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Distributor for any
legal or other expenses reasonably incurred by such Distributor in
connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred; provided,
however, that the Issuer will not be liable to such Distributor in any
such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any of such documents
which (i) is
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made in reliance upon and in conformity with written information
furnished to the Issuer by such Distributor specifically for use
therein, unless such loss, claim, damage or liability arises out of the
offer or sale of Securities occurring after the Distributor has
notified the Issuer in writing that such information should no longer
be used therein, it being understood and agreed that the only such
information furnished by any Distributor consists of the information
described as such in subsection (b) below; or (ii) is corrected in any
amendment or supplement to the Registration Statement or the
Prospectus, provided that the Issuer has performed each of its
obligations under Section 4 in respect of such amendment or supplement
and, to the extent that a prospectus relating to the Securities was
required to be delivered by such Distributor under the Act, such
Distributor, having been furnished by or on behalf of the Issuer with
copies of the Prospectus as so amended or supplemented, thereafter
fails to deliver such amended or supplemented Prospectus prior to or
concurrently with the sale of the Securities to the person asserting
such loss, claim, damage, or liability.
(b) Each Distributor will severally and not jointly indemnify
and hold harmless the Issuer against any losses, claims, damages or
liabilities to which the Issuer may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in
the Registration Statement, the Prospectus or any amendment or
supplement thereto, or any related preliminary prospectus or
preliminary prospectus supplement, or arise out of or are based upon
the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Issuer by such
Distributor specifically for use therein, and will reimburse any legal
or other expenses reasonably incurred by the Issuer in connection with
investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred, unless such loss, claim, damage
or liability arises out of the offer or sale of Securities occurring
after the Distributor has notified the Issuer in writing that such
information should no longer be used therein, it being understood and
agreed that the only such information furnished by any Distributor
consists of the information under the heading "Plan of Distribution."
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under subsection (a) or (b) above, notify the
indemnifying party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it from any liability
which it may have to any indemnified party otherwise than under
subsection (a) or (b) above to the extent it is not prejudiced as a
proximate result of such failure. In case any such action is brought
against any indemnified party, and it notifies the indemnifying party
of the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party, and after
notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party will
not be liable to
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such indemnified party under this Section 7 for any legal or other
expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation.
The indemnified party will have the right to employ its own counsel in
any such action, but the fees and expenses of such counsel will be at
the expense of the indemnified party unless the indemnified party's
counsel has reasonably concluded that there may be legal defense
available to it which are different from or in addition to those
available to the indemnifying party. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action 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 any claims that are the subject matter of such
action.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a
result of the losses, claims, damages or liabilities referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to
reflect the relative benefits received by the Issuer on the one hand
and any Distributor on the other from the offering pursuant to this
Agreement of the Securities which are the subject of the action 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 Issuer on the one hand and any Distributor on the
other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities as well as any other
relevant equitable considerations. The relative benefits received by
the Issuer on the one hand and any Distributor on the other shall be
deemed to be in the same proportions as the total net proceeds from the
offering pursuant to this Agreement of the Securities which are the
subject of the action (before deducting expenses) received by the
Issuer bear to the total discounts and commissions received by such
Distributor from the offering of such Securities pursuant to this
Agreement. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information supplied by the Issuer or such Distributor
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission.
The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of
this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the
subject of this subsection (d). Notwithstanding the provisions of this
subsection (d), no Distributor shall be required to contribute any
amount in excess of the amount by which the total price at which the
Securities which are the subject of the action and which were
distributed to the public through it pursuant to this Agreement or upon
resale of Securities purchased by it from the Issuer exceeds the amount
of any damages which such Distributor has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
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misrepresentation. The obligations of each Distributor in this
subsection (d) to contribute are several, in the same proportion which
the amount of the Securities which are the subject of the action and
which were distributed to the public through such Distributor pursuant
to this Agreement bears to the total amount of such Securities
distributed to the public through all of the Distributors pursuant to
this Agreement, and not joint.
(e) The obligations of the Issuer under this Section 7 shall
be in addition to any liability which the Issuer may otherwise have and
shall extend, upon the same terms and conditions, to each person, if
any, who controls each Distributor within the meaning of the Act; and
the obligations of each Distributor under this Section 7 shall be in
addition to any liability which each Distributor may otherwise have and
shall extend, upon the same terms and conditions, to each director of
the Issuer, to each officer of the Issuer who has signed the
Registration Statement and to each person, if any, who controls the
Issuer within the meaning of the Act.
8. Status of Each Distributor. In soliciting offers to purchase the
Securities from the Issuer pursuant to this Agreement and in assuming its other
obligations hereunder (other than any obligation to purchase Securities pursuant
to Section 3(b)(iii) hereof), each Distributor is acting individually and not
jointly and is acting solely as agent for the Issuer and not as principal. In
connection with the placement of any Securities by a Distributor, acting as
agent, (a) each Distributor will make reasonable efforts to assist the Issuer in
obtaining performance by each purchaser whose offer to purchase Securities from
the Issuer has been solicited by such Distributor and accepted by the Issuer,
but such Distributor shall have no liability to the Issuer in the event any such
purchase is not consummated for any reason; and (b) if the Issuer shall default
on its obligations to deliver Securities to a purchaser whose offer it has
accepted, the Issuer (i) shall hold the Distributors harmless against any loss,
claim or damage arising from or as a result of such default by the Issuer, and
(ii) in particular, shall pay to the Distributors any commission to which they
would be entitled in connection with such sale.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Issuer or its officers and of the Distributors set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation, or statement as to the results thereof, made by or on behalf of
any Distributor, the Issuer or any of their respective representatives, officers
or directors or any controlling person and will survive delivery of and payment
for the Securities. If this Agreement is terminated pursuant to Section 10 or
for any other reason or if for any reason the sale of Securities described in a
confirmation or Terms Agreement referred to in Section 3 by the Issuer to a
Distributor is not consummated, the Issuer shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 4(j) and the
obligations of the Issuer under Sections 4(f) and 4(i) and the respective
obligations of the Issuer and the Distributors pursuant to Section 7 shall
remain in effect. In addition, if any such termination of this Agreement shall
occur either (i) at a time when any Distributor shall own any of the Securities
with the intention of reselling them or (ii) after the Issuer has accepted an
offer to purchase Securities and prior to the related settlement, the
obligations of the Issuer under the second sentence of Section 4(c), under
Sections 4(a), 4(b), 4(d), 4(e), 4(g), 4(h) and 4(k) and, in the case of a
termination occurring as described in (ii) above, under Sections 3(c), 6(a),
6(e) and 6(f) and under the last sentence of Section 8, shall also remain in
effect.
-23-
<PAGE>
10. Termination. This Agreement may be terminated for any reason at any
time by the Issuer as to any Distributor or, in the case of any Distributor, by
such Distributor insofar as this Agreement relates to such Distributor, upon the
giving of one day's written notice of such termination to the other parties
hereto; provided, however, that this Agreement may not be terminated with
respect to a Distributor by the giving of such notice following receipt by the
Issuer of a confirmation or Terms Agreement referred to in Section 3 relating to
the purchase of Securities by such Distributor and prior to delivery of the
Securities described in such confirmation or Terms Agreement, unless the sale
and purchase of Securities contemplated thereby is rejected by the Issuer in
accordance with Section 3. Any settlement with respect to Securities placed by a
Distributor on an agency basis occurring after termination of this Agreement
shall be made in accordance with the Procedures and each Distributor agrees, if
requested by the Issuer, to take the steps therein provided to be taken by such
Distributor in connection with such settlement.
11. Sales of Securities Denominated in a Currency other than U.S.
Dollars or of Indexed Securities. If at any time the Issuer and any of the
Distributors shall determine to issue and sell Securities denominated in a
currency other than U.S. dollars, which other currency may include a currency
unit, or with respect to which an index is used to determine the amounts of
payments of principal and any premium and interest, the Issuer and any such
Distributor may execute and deliver a supplement to this Agreement for the
purpose of making any appropriate additions to and modifications of the terms of
this Agreement (and the Procedures) applicable to such Securities and the offer
and sale thereof. Subject to the Issuer's obligations under Section 4(h), each
Distributor agrees, directly or indirectly, not to solicit offers to purchase or
offer or sell any Security in or to residents of any foreign jurisdiction except
as permitted by applicable law. The Issuer will not issue Securities denominated
in Yen otherwise than in compliance with applicable Japanese laws, regulations
and policies. In particular, the Issuer or its designated agent shall submit
such reports or information as may be required from time to time by applicable
law, regulations and guidelines promulgated by Japanese governmental and
regulatory authorities in the case of the issue and purchase of the Securities.
12. Notices. Except as otherwise provided herein, all notices and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if mailed or transmitted by any standard form of telecommunication.
Notices to Credit Suisse First Boston Corporation shall be directed to it at
Eleven Madison Avenue, New York, New York 10010-3629, Attention: Short and
Medium Term Finance Department (Facsimile No. (212) 325-8183); notices to Banc
One Capital Markets, Inc. shall be directed to it at One First National Plaza,
Chicago, Illinois 60670, Attention: Corporate Securities Structuring (Facsimile
No. (312) 732-4172); notices to J.P. Morgan Securities Inc. shall be directed to
it at 60 Wall Street, New York, New York 10260, Attention: __________ (Facsimile
No. ___________); and notices to the Issuer shall be directed to it at Jostens,
Inc., 5501 Norman Center Drive, Minneapolis, Minnesota 55437, Attention:
Treasurer (Facsimile No. (612) 830-3261); or in the case of any party hereto, to
such other address or person as such party shall specify to each other party by
a notice given in accordance with the provisions of this Section 12. Any such
notice shall take effect at the time of receipt.
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto, their respective successors, the officers and
directors and controlling persons referred to in Section 7 and, to the extent
provided in Section 6(f), any person who has agreed to
-24-
<PAGE>
purchase Securities from the Issuer, and no other person will have any right or
obligation hereunder.
14. Counterparts. This Agreement and any Terms Agreement may be
executed in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
Agreement.
15. Applicable Law. This Agreement and any Terms Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York, without regard to principles of conflicts of laws.
The Issuer hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or any Terms
Agreement or the transactions contemplated hereby or thereby.
If the foregoing correctly sets forth our agreement, please indicate
your acceptance hereof in the space provided for that purpose below.
Very truly yours,
JOSTENS, INC.
By:
-----------------------------
Name:
Title:
CONFIRMED AND ACCEPTED, as of the
date first above written:
CREDIT SUISSE FIRST BOSTON CORPORATION
By:
----------------------------------
Name:
Title:
BANC ONE CAPITAL MARKETS, INC.
By:
----------------------------------
Name:
-25-
<PAGE>
Title:
J.P. MORGAN SECURITIES INC.
By:
----------------------------------
Name:
Title:
-26-
<PAGE>
EXHIBIT A
Commission Schedule
-------------------
Commission (percentage of aggregate
Range of Maturities principal amount of Securities sold)
- ------------------- ------------------------------------
From 9 months to less than 1 year .125%
From 1 year to less than 18 months .150%
From 18 months to less than 2 years .200%
From 2 years to less than 3 years .250%
From 3 years to less than 4 years .350%
From 4 years to less than 5 years .450%
From 5 years to less than 6 years .500%
From 6 years to less than 7 years .550%
From 7 years to less than 10 years .600%
From 10 years to less than 15 years .625%
From 15 years to less than 20 years .675%
From 20 years to 30 years .750%
From more than 30 years to less than 50 years .875%
50 years and more 1.000%
<PAGE>
EXHIBIT B
Jostens, Inc.
("Issuer")
Medium-Term Notes, Series A
Due Nine Months or More from Date of Issue
Terms Agreement
-------------, ------
Jostens, Inc.
5501 Norman Center Drive
Minneapolis, MN 55437
Attention:
Ladies and Gentlemen:
We offer to purchase, on and subject to the terms and conditions of the
Distribution Agreement filed as an exhibit to the Issuer's registration
statement on Form S-3 (No. 333- ) ("Distribution Agreement"), the following
Notes ("Notes") on the following terms:
Title:
Currency or Currency Units:
Stated Maturity:
Principal Amount:
Public Offering Price: [___%, subject to change by the undersigned
-- The Distributor[s] propose[s] to reoffer
the above Notes from time to time at market
prices prevailing at the time of sale, at
prices related to such prevailing market
prices or at negotiated prices.]
Original Issue Discount Security: Yes ____ No ____
Purchase Price (to be paid in [New York Clearing House (next day)
-- immediately available] funds): ___% [, plus accrued interest, if
any, from the Trade Date to the Settlement Date]
Underwriting Discount (%):
<PAGE>
In the case of Fixed Rate Notes, the interest rate and, if
different from the dates set forth in the Prospectus Supplement,
the Interest Payment Date or Dates and corresponding Regular Record
Date or Dates:
In the case of Floating Rate Notes, the Interest rate formula,
Initial Interest Rate, the Index Maturity, the Spread or Spread
Multiplier (if any), the maximum or minimum Interest rate
limitations (if any), the Interest Reset Dates, the Interest
Determination Dates, the Calculation Agent, the Calculation Dates,
the Interest Payment Dates and the Regular Record Dates, in each
case to the extent applicable:
Redemption (option of the Issuer), if any:
Redemption Date(s):
Redemption Prices(s)(%):
Notice Period:
Repayment (option of the Holder), if any:
Redemption Date(s):
Redemption Price(s)(%):
Notice Period:
Sinking Fund, if applicable:
Trade Date:
Settlement Date (Issue Date):
* * * * *
Details for Settlement
- ----------------------
_ Book-entry Security
_ Certificated Securities
[Additional Purchase Information -- to be completed by Distributor,
if desired, to the extent available]
Exact name in which the Note or Notes are to be registered
("registered owner"):
Exact address of registered owner and, if different, the address
for delivery of notices and payment of principal and any premium
and interest:
Taxpayer identification number of registered owner:
- 2 -
<PAGE>
Principal amount of each Note in authorized denominations to be
delivered to registered owner:
Exchange rate applicable to purchase Foreign Currency Notes to be
paid for in U.S. dollars:
* * * * *
Our agreement to purchase the Notes hereunder is subject to the
conditions set forth in the Distribution Agreement, [including the conditions
set forth in paragraphs (e), (f), (g) and (h) of Section 5 thereof] [, and
[specify additional conditions, if any]]. If for any reason the purchase by the
undersigned of the Notes is not consummated other than because of a default by
the undersigned or a failure to satisfy a condition set forth in clause (iii),
(iv) or (v) of Section 5(c) of the Distribution Agreement, the Issuer shall
reimburse the undersigned for all out-of-pocket expenses reasonably incurred by
the undersigned in connection with the offering of the Notes and not otherwise
required to be reimbursed pursuant to Section 4 of the Distribution Agreement.
[Insert any additional agreements, conditions, etc.]
- 3 -
<PAGE>
Unless the undersigned has received notification from the Issuer within
[one Business Day (as defined in the Distribution Agreement)] that the Issuer
does not agree to the terms set forth herein, this Terms Agreement shall
constitute an agreement between the Issuer and the undersigned for the sale and
purchase of the Notes upon the terms set forth herein and in the Distribution
Agreement.
Very truly yours,
[CREDIT SUISSE FIRST BOSTON]
[By ____________________________________]
[Insert Title]
[BANC ONE CAPITAL MARKETS, INC.]
[By ____________________________________]
[Insert Title]
[J.P. MORGAN SECURITIES INC.]
[By ____________________________________]
[Insert Title]
Accepted and agreed to
as of the date set forth above.
JOSTENS, INC.
[By _______________________________]
[Insert Title]
- 4 -
<PAGE>
EXHIBIT C
JOSTENS, INC.
Administrative Procedure
------------------------
This Administrative Procedure relates to the Securities defined in
the Distribution Agreement, dated ___________________________, 1999 (the
"Distribution Agreement"), between Jostens, Inc. (the "Issuer") and Credit
Suisse First Boston Corporation, J.P. Morgan Securities Inc. and Banc One
Capital Markets, Inc. (together, the "Distributors"), to which this
Administrative Procedure is attached as Exhibit C. Defined terms used herein and
not defined herein shall have the meanings given such terms in the Distribution
Agreement, the Prospectus as amended or supplemented or the Indenture.
The procedures to be followed with respect to the settlement of
sales of Securities directly by the Issuer to purchasers solicited by a
Distributor, as agent, are set forth below. The terms and settlement details
related to a purchase of Securities by an Distributor, as principal, from the
Issuer will be set forth in a Terms Agreement pursuant to the Distribution
Agreement. A Distributor, in relation to a purchase of a Security by a purchaser
solicited by such Distributor, is referred to herein as the "Selling
Distributor".
The Issuer will advise each Distributor in writing of those persons
with whom such Distributor is to communicate regarding offers to purchase
Securities and the related settlement details.
Each Security will be issued only in fully registered form and will
be represented by either a global security (a "Global Security") delivered to
the Trustee, as agent for The Depository Trust Company (the "Depositary") and
recorded in the book-entry system maintained by the Depositary (a "Book-Entry
Security") or a certificate issued in definitive form (a "Certificated
Security") delivered to a person designated by an Distributor, as set forth in
the applicable Pricing Supplement. An owner of a Book-Entry Security will not be
entitled to receive a certificate representing such a Security, except as
provided in the Indenture.
Book-Entry Securities will be issued in accordance with the
Administrative Procedure set forth herein. The procedures for the issuance of
Certificated Securities will be agreed among the Issuer, the Distributors and
the Trustee prior to the issuance of any such Certificated Security.
<PAGE>
Administrative Procedure for Book-Entry Securities
--------------------------------------------------
In connection with the qualification of the Book-Entry Securities
for eligibility in the book-entry system maintained by the Depositary, the
Trustee will perform the custodial, document control and administrative
functions described below, in accordance with its respective obligations under a
Letter of Representation from the Issuer and the Trustee to the Depositary,
dated the date hereof, and a Medium-Term Note Certificate Agreement between the
Trustee and the Depositary, dated as of _______________________ (the
"Certificate Agreement"), and its obligations as a participant in the
Depositary, including the Depositary's Same-Day Funds Settlement System
("SDFS").
Posting Rates by the Issuer:
- ----------------------------
The Issuer and the Distributors will discuss from time to time the
rates of interest per annum to be borne by and the maturity of Book-Entry
Securities that may be sold as a result of the solicitation of offers by an
Distributor. The Issuer may establish a fixed set of interest rates and
maturities for an offering period ("posting"). If the Issuer decides to change
already posted rates, it will promptly advise the Distributors to suspend
solicitation of offers until the new posted rates have been established with the
Distributors.
Acceptance of Offers by the Issuer:
- -----------------------------------
Each Distributor will promptly advise the Issuer by telephone or
other appropriate means of all reasonable offers to purchase Book-Entry
Securities, other than those rejected by such Distributor. Each Distributor may,
in its discretion reasonably exercised, reject any offer received by it in whole
or in part. The Issuer will have the sole right to accept offers to purchase
Book-Entry Securities and may reject any such offer in whole or in part.
The Issuer will promptly notify the Selling Distributor of its
acceptance or rejection of an offer to purchase Book-Entry Securities. If the
Issuer accepts an offer to purchase Book-Entry Securities, it will confirm such
acceptance in writing to the Selling Distributor and the Trustee.
Interest:
- ---------
Interest on Book-Entry Securities will accrue and will be paid at
the times and in the manner consistent with the description thereof in the
Company's Prospectus Supplement dated _________, 1999 to the Prospectus dated
_________, 1999 and the applicable Pricing Supplement thereto.
Exchanges:
- ----------
-2-
<PAGE>
The Trustee, at the Issuer's request, may deliver to DTC and the CUSIP
Service Bureau at any time a written notice of consolidation specifying (a) the
CUSIP numbers of two or more Global Securities outstanding on such date that
represent (i) Fixed-Rate Book-Entry Notes having the same terms (other than
Settlement Dates) or (ii) Floating Rate Book-Entry Securities having the same
terms (other than Settlement Dates); (b) a date, at least 30 days after such
written notice is delivered and at least 30 days before the next interest
Payment Date for the related Book-Entry Notes, on which such Global Security
shall be exchanged for a single replacement Global Security; and (c) a new CUSIP
number to be assigned to such replacement Global Security. Upon receipt of such
a notice, DTC will send to its participants (including the Trustee) a written
reorganization notice to the effect that such exchange will occur on such date.
Prior to the specified exchange date, the Trustee will deliver to the CUSIP
Service Bureau written notice setting forth such exchange date and the new CUSIP
number and stating that, as of such exchange date, the CUSIP numbers of the
Global Securities to be exchanged will no longer be valid. On the specified
exchange date, the Trustee will exchange such Global Securities and the old
CUSIP numbers for a single Global Security bearing the new CUSIP number. The
CUSIP numbers of the exchanged Global Securities will, in accordance with CUSIP
Service Bureau procedures be canceled and not immediately reassigned.
Notwithstanding the foregoing, if the Global Securities to be exchanged exceed
$200,000,000 in aggregate principal amount, one replacement Security will be
authenticated and issued to represent each $200,000,000 of principal amount of
principal amount of the exchanged Global Securities and an additional Global
Note will be authenticated and issued to represent any remaining principal
amount of such Global Securities.
Manner of Payment:
- ------------------
The total amount of principal, premium, if any, and interest due on a
Global Security on any Interest Payment Date or at maturity or upon redemption
or repayment shall be paid by the Issuer to the Trustee in funds available for
use by the Trustee on such date. The Issuer will make payment on such Global
Security by depositing funds sufficient to make such payment with the Trustee.
The Issuer will confirm such instructions in writing to the Trustee. For
payments of principal and any premium at maturity or upon redemption or
repayment prior to 10:00 a.m. (New York City time) on such date or as soon as
possible thereafter the Trustee will pay the Depositary by separate wire
transfer (using Fedwire message entry instructions in a form previously
specified by the Depositary) to an account at the Federal Reserve Bank of New
York previously specified by the Depositary, in funds available for immediate
use by the Depositary, each payment of interest, premium, if any, or principal
(together with interest thereon) due on a Global Security on such date. For
payments of interest, the Trustee will pay the Depositary such payments in
same-day funds on each Interest Payment Date in accordance with existing
arrangements between the Trustee and the Depositary. Thereafter for all payments
on such date, the Depositary will pay, in accordance with SDFS operating
procedures then in effect, such amounts in funds available for immediate use to
the respective participants with payments in amounts proportionate to their
respective holdings in principal amount of beneficial interest in such Global
Security as are recorded in the book-entry system maintained by the Depositary.
-3-
<PAGE>
Communication of Sale Information to the Issuer by Selling Distributor and
- --------------------------------------------------------------------------
Settlement Procedures:
- ----------------------
A. After the acceptance of an offer by the Issuer, the Selling
Distributor will communicate promptly, but in no event later than the time set
forth under "Settlement Procedure Timetable" below, the following details of the
terms of such offer (the "Sale Information") to the Issuer by telephone
(confirmed in writing) or by facsimile transmission or other acceptable written
means:
(1) Principal amount of Book-Entry Securities to be purchased;
(2) If a Fixed Rate Book-Entry Security, the interest rate and
initial Interest Payment Date;
(3) Trade Date;
(4) Settlement Date (Original Issue Date);
(5) Maturity Date;
(6) Specified Currency and, if the Specified Currency is other
than U.S. dollars, the applicable Exchange Rate for such
Specified Currency (it being understood that currently the
Depositary accepts deposits of Global Securities denominated
in U.S. dollars only);
(7) Indexed Currency, the Base Rate and the Exchange Rate
Determination Date, if applicable;
(8) Issue price;
(9) Selling Distributor's commission;
(10) Net proceeds to the Issuer;
(11) If a redeemable Book-Entry Security, such of the following as
are applicable:
(i) Redemption Commencement Date,
(ii) Initial Redemption Price (% of par), and
(iii) Amount (% of par) that the Redemption Price shall
decline (but not below par) on each anniversary of
the Redemption Commencement Date;
-4-
<PAGE>
(12) If a Floating Rate Book-Entry Security, such of the following
as are applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread or Spread Multiplier,
(iv) Maximum Rate,
(v) Minimum Rate,
(vi) Initial Interest Rate,
(vii) Interest Reset Dates,
(viii) Calculation Dates,
(ix) Interest Determination Dates,
(x) Interest Payment Dates,
(xi) Regular Record Dates, and
(xii) Calculation Agent;
(13) Name, address and taxpayer identification number of the
registered owner(s);
(14) Denomination of certificates to be delivered at settlement;
(15) Book-Entry Security or Certificated Security; and
(16) Selling Distributor.
B. After receiving the Sale Information from the Selling Distributor,
the Issuer will communicate such Sale Information to the Trustee by facsimile
transmission or other acceptable written means. The Trustee will assign a CUSIP
number to the Global Security from a list of CUSIP numbers previously delivered
to the Trustee by the Issuer representing such Book-Entry Security and then
advise the Issuer and the Selling Distributor, of such CUSIP number.
C. The Trustee will enter a pending deposit message through the
Depositary's Participant Terminal System, providing the following settlement
information to the Depositary, and the Depositary shall forward such information
to such Distributor and Standard & Poor's Corporation:
(1) The applicable Sale Information;
(2) CUSIP number of the Global Security representing such
Book-Entry Security;
-5-
<PAGE>
(3) Whether such Global Security will represent any other
Book-Entry Security (to the extent known at such time);
(4) Number of the Participant account maintained by the Depositary
on behalf of the Selling Distributor;
(5) The interest payment period; and
(6) Initial Interest Payment Date for such Book-Entry Security,
number of days by which such date succeeds the record date for
the Depositary's purposes (which, in the case of Floating Rate
Securities which reset weekly shall be the date five calendar
days immediately preceding the applicable Interest Payment
Date and in the case of all other Book-Entry Securities shall
be the Regular Record Date, as defined in the Security) and,
if calculable at that time, the amount of interest payable on
such Interest Payment Date.
D. The Trustee will complete and authenticate the Global Security
previously delivered by the Issuer representing such Book-Entry Security.
E. The Depositary will credit such Book-Entry Security to the Trustee's
participant account at the Depositary.
F. The Trustee will enter an SDFS deliver order through the
Depositary's Participant Terminal System instructing the Depositary to (i) debit
such Book-Entry Security to the Trustee's participant account and credit such
Book-Entry Security to such Distributor's participant account and (ii) debit
such Distributor's settlement account and credit the Trustee's settlement
account for an amount equal to the issue price of such Book-Entry Security less
such Selling Distributor's commission. The entry of such a deliver order shall
constitute a representation and warranty by the Trustee to the Depositary that
(a) the Global Security representing such Book-Entry Security has been issued
and authenticated and (b) the Trustee is holding such Global Security pursuant
to the Certificate Agreement.
G. Such Distributor will enter an SDFS deliver order through the
Depositary's Participant Terminal System instructing the Depositary (i) to debit
such Book-Entry Security to such Distributor's participant account and credit
such Book-Entry Security to the participant accounts of the participants with
respect to such Book-Entry Security and (ii) to debit the settlement accounts of
such participants and credit the settlement account of such Distributor for an
amount equal to the issue price of such Book-Entry Security.
H. Transfers of funds in accordance with SDFS deliver orders described
in Settlement Procedures "F" and "G" will be settled in accordance with SDFS
operating procedures in effect on the Settlement Date.
-6-
<PAGE>
I. Upon confirmation of receipt of funds, the Trustee will transfer to
the account of the Issuer maintained at ___________________, New York, New York,
or such other account as the Issuer may have previously specified to the
Trustee, in funds available for immediate use in the amount transferred to the
Trustee in accordance with Settlement Procedure "F".
J. Upon request, the Trustee will send to the Issuer a statement
setting forth the principal amount of Book-Entry Securities outstanding as of
that date under the Indenture.
K. Such Distributor will confirm the purchase of such Book-Entry
Security to the purchaser either by transmitting to the Participants with
respect to such Book-Entry Security a confirmation order or orders through the
Depositary's institutional delivery system or by mailing a written confirmation
to such purchaser.
L. The Depositary will, at any time, upon request of the Issuer or the
Trustee, promptly furnish to the Issuer or the Trustee a list of the names and
addresses of the participants for whom the Depositary has credited Book-Entry
Securities.
Preparation of Pricing Supplement:
- ----------------------------------
If the Issuer accepts an offer to purchase a Book-Entry Security, it
will prepare a Pricing Supplement reflecting the terms of such Book-Entry
Security and arrange to have delivered to the Selling Distributor at least ten
copies of such Pricing Supplement, not later than 5:00 p.m., New York City time,
on the Business Day following the receipt of the Sale Information, or if the
Issuer and the purchaser agree to settlement on the Business Day following the
date of acceptance, not later than noon, New York City time, on such date. The
Issuer will file the Pricing Supplement with the Commission not later than the
close of business of the Commission on the second Business Day following the
earlier of the date of determination of the Sale Information or the date on
which such Pricing Supplement is first used.
Delivery of Confirmation and Prospectus to Purchaser by Selling Distributor:
- ----------------------------------------------------------------------------
The Selling Distributor will deliver to the purchaser of a Book-Entry
Security a written confirmation of the sale and delivery and payment
instructions. In addition, the Selling Distributor will deliver to such
purchaser or its agent the Prospectus as amended or supplemented (including the
Pricing Supplement) in relation to such Book-Entry Security prior to or together
with the earlier of the delivery to such purchaser or its agent of (a) the
confirmation of sale or (b) the Book-Entry Security.
-7-
<PAGE>
Date of Settlement:
- -------------------
The receipt by the Issuer of immediately available funds in payment for
a Book-Entry Security and the authentication and issuance of the Global Security
representing such Book-Entry Security shall constitute "settlement" with respect
to such Book-Entry Security. All orders of Book-Entry Securities solicited by a
Selling Distributor and accepted by the Issuer on a particular date (the "Trade
Date") will be settled on a date (the "Settlement Date") which is the third
Business Day after the Trade Date pursuant to the "Settlement Procedure
Timetable" set forth below, unless the Issuer and the purchaser agree to
settlement on another Business Day which shall be no earlier than the next
Business Day after the Trade Date.
Settlement Procedure Timetable:
- -------------------------------
For orders of Book-Entry Securities solicited by an Distributor, as
agent, and accepted by the Issuer for settlement on the first Business Day after
the Trade Date, Settlement Procedures "A" through "I" set forth above shall be
completed as soon as possible but not later than the respective times (New York
City time) set forth below:
Settlement
Procedure Time Date
- --------- ---- ----
A 5:00 p.m. on the Business Day following the Trade Date or
10:00 a.m. on the Business Day prior to the
Settlement Date, whichever is earlier
B 12:00 noon on the second Business Day immediately
preceding the Settlement Date
C 2:00 p.m. on the second Business Day immediately
preceding the Settlement Date
D 9:00 a.m. on the Settlement Date
E 10:00 a.m. on the Settlement Date
F - G 2:00 p.m. on the Settlement Date
H 4:45 p.m. on the Settlement Date
I 5:00 p.m. on the Settlement Date
If the initial interest rate for a Floating Rate Book-Entry Security
has not been determined at the time that Settlement Procedure "A" is completed,
Settlement Procedures "B" and "C" shall be completed as soon as such rate has
been determined but not later than 2:00 p.m. on the second Business Day
immediately preceding the Settlement Date. Settlement Procedure "H" is subject
to extension in accordance with any extension of Fedwire closing deadlines and
in the other events specified in the SDFS operating procedures in effect on the
Settlement Date.
If settlement of a Book-Entry Security is rescheduled or canceled, the
Trustee, upon obtaining knowledge thereof, will deliver to the Depositary,
through the Depositary's
-8-
<PAGE>
Participation Terminal System, a cancellation message to such effect by no later
than 2:00 p.m. on the Business Day immediately preceding the scheduled
Settlement Date.
Failure to Settle:
- ------------------
If the Trustee fails to enter an SDFS deliver order with respect to a
Book-Entry Security pursuant to Settlement Procedure "F", the Trustee may
deliver to the Depositary, through the Depositary's Participant Terminal System,
as soon as practicable a withdrawal message instructing the Depositary to debit
such Book-Entry Security to the Trustee's participant account, provided that the
Trustee's participant account contains a principal amount of the Global Security
representing such Book-Entry Security that is at least equal to the principal
amount to be debited. If a withdrawal message is processed with respect to all
the Book-Entry Securities represented by a Global Security, the Trustee will
cancel such Global Security, make appropriate entries in the Trustee's records
and, unless otherwise instructed by the Issuer, destroy the Global Security. The
CUSIP number assigned to such Global Security shall, in accordance with CUSIP
Service Bureau procedures, be cancelled and not immediately reassigned. If a
withdrawal message is processed with respect to one or more, but not all, of the
Book-Entry Securities represented by a Global Security, the Trustee will
exchange such Global Security for two Global Securities, one of which shall
represent such Book-Entry Security or Securities and shall be cancelled
immediately after issuance (and, unless otherwise instructed by the Issuer,
destroyed by the Trustee) and the other of which shall represent the remaining
Book-Entry Securities previously represented by the surrendered Global Security
and shall bear the CUSIP number of the surrendered Global Security.
If the purchase price for any Book-Entry Security is not timely paid to
the participants with respect to such Book-Entry Security by the beneficial
purchaser thereof (or a person, including an indirect participant in the
Depositary, acting on behalf of such purchaser), such participants and, in turn,
the Distributor for such Book-Entry Security may enter deliver orders through
the Depositary's Participant Terminal System debiting such Book-Entry Security
to such participant's account and crediting such Book-Entry Security to such
Distributor's account and then debiting such Book-Entry Security to such
Distributor's participant account and crediting such Book-Entry Security to the
Trustee's participant account and shall notify the Issuer and the Trustee
thereof. Thereafter, the Trustee will (i) immediately notify the Issuer of such
order and the Issuer shall transfer to such Distributor funds available for
immediate use in an amount equal to the price of such Book-Entry Security which
was credited to the account of the Issuer maintained at the Trustee in
accordance with Settlement Procedure I, and (ii) deliver the withdrawal message
and take the related actions described in the preceding paragraph. If such
failure shall have occurred for any reason other than default by the applicable
Distributor to perform its obligations hereunder or under the Distribution
Agreement, the Issuer will reimburse such Distributor on an equitable basis for
the loss of its use of funds during the period when the funds were credited to
the account of the Issuer.
-9-
<PAGE>
Notwithstanding the foregoing, upon any failure to settle with respect
to a Book-Entry Security, the Depositary may take any actions in accordance with
its SDFS operating procedures then in effect. In the event of a failure to
settle with respect to one or more, but not all, of the Book-Entry Securities to
have been represented by a Global Security, the Trustee will provide, in
accordance with Settlement Procedure "D", for the authentication and issuance of
a Global Security representing the other Book-Entry Securities to have been
represented by such Global Security and will make appropriate entries in its
records. The Issuer will, from time to time, furnish the Trustee with a
sufficient quantity of forms of Global Securities.
-10-
<PAGE>
Exhibit 4.1
- --------------------------------------------------------------------------------
JOSTENS, INC.
TO
NORWEST BANK MINNESOTA, N.A.
Trustee
---------------------
INDENTURE
Dated as of _________________, 1999
---------------------
- --------------------------------------------------------------------------------
<PAGE>
JOSTENS, INC.
Reconciliation and tie between Trust Indenture Act of 1939 and
Indenture, dated as of _________, 1999
Trust Indenture
Act Section Indenture Section
----------- -----------------
ss.310 (a)(1)........................................... 609
(a)(2)........................................... 609
(a)(3)...........................................Not Applicable
(a)(4)...........................................Not Applicable
(a)(5)........................................... 609
(b).............................................. 608, 610
ss. 311 ................................................. 613
ss. 312 (a).............................................. 701, 702(a)
(b).............................................. 702(b)
(c).............................................. 702(c)
ss.313 ................................................. 703
ss.314 (a).............................................. 704
(b)..............................................Not Applicable
(c)(1)........................................... 102
(c)(2)........................................... 102
(c)(3)...........................................Not Applicable
(d)..............................................Not Applicable
(e).............................................. 102
ss.315 (a).............................................. 601
(b).............................................. 602
(c).............................................. 601
(d).............................................. 601
(e).............................................. 514
ss.316 (a).............................................. 101
(a)(1)(A)........................................ 502, 512
(a)(1)(B)........................................ 513
(a)(2)...........................................Not Applicable
(b).............................................. 508
ss.317 (a)(1)........................................... 503
(a)(2)........................................... 504
(b).............................................. 1003
ss.318 (a).............................................. 107
- -------------------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be
part of the Indenture.
<PAGE>
TABLE OF CONTENTS
RECITALS OF THE COMPANY.....................................................1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION.................1
SECTION 101. Definitions ..............................................1
SECTION 102. Compliance Certificates and Opinions .....................8
SECTION 103. Form of Documents Delivered to Trustee ...................9
SECTION 104. Acts of Holders ..........................................9
SECTION 105. Notices, Etc., to Trustee and Company ...................10
SECTION 106. Notice to Holders; Waiver ...............................11
SECTION 107. Compliance with Trust Indenture Act .....................11
SECTION 108. Effect of Headings and Table of Contents ................11
SECTION 109. Successors and Assigns ..................................11
SECTION 110. Separability Clause .....................................12
SECTION 111. Benefits of Indenture ...................................12
SECTION 112. Governing Law ...........................................12
SECTION 113. Legal Holidays ..........................................12
ARTICLE TWO
SECURITY FORMS.........................................................12
SECTION 201. Forms Generally .........................................12
SECTION 202. Form of Face of Security ................................13
SECTION 203. Form of Reverse of Security .............................15
SECTION 204. Form of Trustee's Certificate of Authentication .........19
SECTION 205. Form of Legend for Global Securities ....................19
ARTICLE THREE
THE SECURITIES.........................................................20
SECTION 301. Amount Unlimited; Issuable in Series ....................20
SECTION 302. Denominations ...........................................22
SECTION 303. Execution, Authentication, Delivery and Dating ..........23
SECTION 304. Temporary Securities ....................................25
SECTION 305. Registration, Registration of Transfer and Exchange .....25
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities ........27
SECTION 307. Payment of Interest; Interest Rights Preserved ..........27
SECTION 308. Persons Deemed Owners ...................................29
SECTION 309. Cancellation. ...........................................29
SECTION 310. Computation of Interest .................................29
SECTION 311. Payment to be in Proper Currency ........................29
ARTICLE FOUR
SATISFACTION AND DISCHARGE.............................................30
SECTION 401. Satisfaction and Discharge of Indenture ..................30
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SECTION 402. Application of Trust Money ..............................31
SECTION 403. Defeasance and Discharge of Indenture ...................31
ARTICLE FIVE
REMEDIES...............................................................33
SECTION 501. Events of Default .......................................33
SECTION 502. Acceleration of Maturity; Rescission and Annulment ......34
SECTION 503. Collection of Indebtedness and Suits for Enforcement
by Trustee ..............................................35
SECTION 504. Trustee May File Proofs of Claim ........................36
SECTION 505. Trustee May Enforce Claims Without Possession of
Securities ..............................................37
SECTION 506. Application of Money Collected ..........................37
SECTION 507. Limitation on Suits .....................................37
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.....................................38
SECTION 509. Restoration of Rights and Remedies ......................38
SECTION 510. Rights and Remedies Cumulative ..........................38
SECTION 511. Delay or Omission Not Waiver ............................39
SECTION 512. Control by Holders ......................................39
SECTION 513. Waiver of Past Defaults .................................39
SECTION 514. Undertaking for Costs ...................................40
SECTION 515. Waiver of Stay or Extension Laws ........................40
ARTICLE SIX
THE TRUSTEE............................................................41
SECTION 601. Certain Duties and Responsibilities .....................41
SECTION 602. Notice of Defaults ......................................41
SECTION 603. Certain Rights of Trustee ...............................41
SECTION 604. Not Responsible for Recitals or Issuance of
Securities ..............................................42
SECTION 605. May Hold Securities .....................................43
SECTION 606. Money Held in Trust .....................................43
SECTION 607. Compensation and Reimbursement ..........................43
SECTION 608. Disqualification; Conflicting Interests .................44
SECTION 609. Corporate Trustee Required; Eligibility .................44
SECTION 610. Resignation and Removal; Appointment of Successor .......44
SECTION 611. Acceptance of Appointment by Successor ..................45
SECTION 612. Merger, Conversion, Consolidation or Succession to
Business ................................................47
SECTION 613. Preferential Collection of Claims Against Company .......47
SECTION 614. Appointment of Authenticating Agent .....................47
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY......................49
SECTION 701. Company to Furnish Trustee Names and Addresses of
Holders .................................................49
SECTION 702. Preservation of Information; Communications to Holders ..49
SECTION 703. Reports by Trustee ......................................49
SECTION 704. Reports by Company ......................................50
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ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE....................51
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms .....51
SECTION 802. Successor Substituted ....................................51
ARTICLE NINE
SUPPLEMENTAL INDENTURES.................................................51
SECTION 901. Supplemental Indentures Without Consent of Holders .......52
SECTION 902. Supplemental Indentures with Consent of Holders ..........53
SECTION 903. Execution of Supplemental Indentures. ....................54
SECTION 904. Effect of Supplemental Indentures ........................54
SECTION 905. Conformity with Trust Indenture Act ......................54
SECTION 906. Reference in Securities to Supplemental Indentures .......55
SECTION 907. Notice of Supplemental Indentures ........................55
ARTICLE TEN
COVENANTS...............................................................55
SECTION 1001. Payment of Principal, Premium and Interest ...............55
SECTION 1002. Maintenance of Office or Agency ..........................55
SECTION 1003. Money for Securities Payments to Be Held in Trust ........56
SECTION 1004. Existence ................................................57
SECTION 1005. Maintenance of Properties ................................57
SECTION 1006. Payment of Taxes and Other Claims ........................57
SECTION 1007. Restriction on Secured Debt ..............................58
SECTION 1008. Restriction on Sale and Leaseback Transactions............60
SECTION 1009. Defeasance of Certain Obligations ........................61
SECTION 1010. Waiver of Certain Covenants ..............................62
ARTICLE ELEVEN
REDEMPTION OF SECURITIES................................................63
SECTION 1101. Applicability of Article .................................63
SECTION 1102. Election to Redeem; Notice to Trustee ....................63
SECTION 1103. Selection by Trustee of Securities to Be Redeemed ........64
SECTION 1104. Notice of Redemption .....................................64
SECTION 1105. Deposit of Redemption Price ..............................65
SECTION 1106. Securities Payable on Redemption Date ....................65
SECTION 1107. Securities Redeemed in Part ..............................65
ARTICLE TWELVE
SINKING FUNDS...........................................................66
SECTION 1201. Applicability of Article .................................66
SECTION 1202. Satisfaction of Sinking Fund Payments with
Securities ...............................................66
SECTION 1203. Redemption of Securities for Sinking Fund ................66
iii
<PAGE>
INDENTURE, dated as of ____________, 1999 between Jostens, Inc., a
corporation duly organized and existing under the laws of the State of Minnesota
(herein called the "Company"), having its principal office at 5501 Norman Center
Drive, Minneapolis, Minnesota 55437, and Norwest Bank Minnesota, N.A., as
Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) any gender used in this Indenture shall be deemed and construed to
include correlative words of the masculine, feminine or neuter gender;
(4) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, 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 at the date of such computation; and
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(5) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
Certain terms, used principally in Article Six, are defined in that
Article.
"Act", when used with respect to any Holder, has the meaning specified in
Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Attributable Debt" in respect of any Sale and Leaseback Transaction means,
at the date of determination, the present value (discounted at the rate of
interest implicit in the terms of the lease) of the obligation of the lessee for
net rental payments during the remaining term of the lease (including any period
for which such lease has been extended or may, at the option of the lessor, be
extended). "Net rental payments" under any lease for any period means the sum of
the rental and other payments required to be paid in such period by the lessee
thereunder, excluding any amounts required to be paid by such lessee (whether or
not designated as rental or additional rental) on account of maintenance and
repairs, insurance, taxes, assessments, water rates or similar charges required
to be paid by such lessee thereunder or any amounts required to be paid by such
lessee thereunder contingent upon the amount of sales, maintenance and repairs,
insurance, taxes, assessments, water rates or similar charges.
"Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 614 to act on behalf of the Trustee to authenticate Securities of one
or more series.
"Board of Directors" means either the board of directors of the Company or
any duly authorized committee appointed by 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. Where any provision of this Indenture refers to action to be
taken pursuant to a Board Resolution (including establishment of any series of
the Securities and the forms and terms thereof), such action may be taken by any
committee, officer or employee of the Company authorized to take such action by
a Board Resolution.
"Business Day", when used with respect to any Place of Payment, means each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions generally in that Place of Payment are obligated by law or
executive order to close, unless otherwise specified in a form of Security.
2
<PAGE>
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Securities Exchange Act of 1934, as amended,
or, if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Company" means the Person named as the "Company" in the first paragraph of
this instrument until a successor corporation shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor corporation.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its President or
a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or
an Assistant Secretary and delivered to the Trustee.
"Consolidated Net Tangible Assets" means the aggregate amount of assets
(less applicable reserves and other properly deductible items) after deducting
therefrom (a) all current liabilities (excluding any indebtedness for money
borrowed having a maturity of less than 12 months from the date of the most
recent consolidated balance sheet of the Company but which by its terms is
renewable or extendable beyond 12 months from such date at the option of the
borrower) and (b) all goodwill, trade names, patents, unamortized debt discount
and expense and any other like intangibles, all as set forth on the most recent
consolidated balance sheet of the Company and computed in accordance with
generally accepted accounting principles.
"Corporate Trust Office" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered.
"Corporation" includes corporations, associations, companies, joint stock
companies and business trusts.
"Debt" has the meaning specified in Section 1007.
"Defaulted Interest" has the meaning specified in Section 307.
"Depositary" means, with respect to the Securities of any series issuable
or issued in whole or in part in the form of one or more Global Securities, the
clearing agency registered under the Exchange Act, specified for that purpose as
contemplated by Section 301 or any successor clearing agency registered under
the Exchange Act as contemplated by Section 305, and if at any time there is
more than one such Person, "Depositary" as used with respect to the Securities
of any series shall mean the Depositary with respect to the Securities of such
series.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
3
<PAGE>
"Funded Debt" means Debt which by its terms matures at or is extendible or
renewable at the option of the obligor to a date more than 12 months after the
date of the creation of such Debt.
"Global Security" means a Security bearing the legend specified in Section
205 evidencing all or part of a series of Securities, issued to the Depositary
for such series or its nominee, and registered in the name of such Depositary or
nominee.
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed or as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof and shall
include the terms of particular series of Securities established as contemplated
by Section 301; provided, however, that, if at any time more than one Person is
acting as Trustee under this instrument due to the appointment of one or more
separate Trustees for any one or more separate series of Securities pursuant to
Section 610(e), "Indenture" shall mean, with respect to such series of
Securities for which any such Person is Trustee, 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
for which such Person is Trustee established as contemplated by Section 301,
exclusive, however, of any provisions or terms which relate solely to other
series of Securities for which such Person is not Trustee, regardless of when
such terms or provisions were adopted, and exclusive of any provisions or terms
adopted by means of one or more indentures supplemental hereto executed and
delivered after such Person had become such Trustee but to which such Person, as
such Trustee, was not a party.
"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.
"Lien" or "Liens" has the meaning specified in Section 1007.
"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 President, a Senior Vice President or a Vice President of the
Company, and by the Treasurer or an Assistant Treasurer of the Company, and
delivered to the Trustee.
4
<PAGE>
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Company and, in the case of counsel for the Company, may be either
inside or outside counsel reasonably acceptable to the Trustee, which opinion
may be subject to standard qualifications and exceptions.
"Original Issue Discount Security" means any Security which provides for an
amount less than the principal amount thereof to be due and payable at maturity
or upon a declaration of acceleration of the Maturity thereof pursuant to
Section 502.
"Outstanding", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(i) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by
the Company (if the Company shall act as its own Paying Agent) for the
Holders of such Securities; provided that, if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made;
and
(iii) Securities which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given 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 502, (ii) the principal amount of a Security
denominated in one or more foreign currencies or currency units that shall be
deemed to be Outstanding shall be the U.S. dollar equivalent, determined in the
manner provided as contemplated by Section 301 as of 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, determined as of
the date of original issuance of such Security, of the amount determined as
provided in (i) above) of such Security as determined by the Company pursuant to
Section 301, 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 deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only
5
<PAGE>
Securities which the Trustee knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Securities and that the pledgee
is not the Company or any other obligor upon the Securities or any Affiliate of
the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) and/or interest on any Securities on behalf
of the Company.
"Periodic Offering" means an offering of Securities of a series from time
to time the specific terms of which Securities, including without limitation the
rate or rates of interest (or formula for determining the rate or rates of
interest), if any, thereon, the Stated Maturity or Maturities thereof and the
redemption provisions, if any, with respect thereto, are to be determined by the
Company or its agents upon the issuance of such Securities.
"Person" means any individual, Corporation, partnership, joint venture,
association, joint stock company, 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 the principal of (and premium, if any) and/or
interest on the Securities of that series are payable, 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.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security, and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Principal Property" means any manufacturing or processing plant
(consisting of real estate buildings and fixtures) located within the United
States of America (other than its territories or possessions) and owned by the
Company or any Subsidiary, the gross book value (without deduction of any
depreciation reserves) of which on the date as of which the determination is
being made exceeds 4% of Consolidated Net Tangible Assets of the Company, except
any such plant (i) to the extent financed by obligations issued by a State or
local governmental unit pursuant to Section 142(a)(5), 142(a)(6), 142(a)(8) or
144(a) of the Internal Revenue Code of 1986, or any successor provision thereof,
or (ii) which is not of material importance to the business conducted by the
Company and its Subsidiaries, taken as a whole (as determined by any two of the
following: the Chairman of the Board of the Company, its President, its Chief
Financial Officer, Chief Operating Officer, its Treasurer or Vice President,
General Counsel).
6
<PAGE>
"Redemption Date", when used with respect to any Security to be redeemed,
means the date fixed for such redemption pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Interest Payment Date
on the Securities of any series means the date specified for that purpose as
contemplated by Section 301.
"Required Currency" has the meaning specified in Section 311.
"Responsible Officer", when used with respect to the Trustee, means any
officer of the Trustee assigned by it to administer its corporate trust matters.
"Restricted Subsidiary" means any Subsidiary which owns or leases a
Principal Property.
"Sale and Leaseback Transaction" has the meaning specified in Section 1008.
"Securities" has the meaning stated in the first recital of this Indenture
and more particularly means any Securities authenticated and delivered under
this Indenture; provided, however, that if at any time there is more than one
Person acting as Trustee under this Indenture, "Securities" with respect to the
Indenture as to which such Person is Trustee shall have the meaning stated in
the first recital of this Indenture and shall more particularly mean Securities
authenticated and delivered under this Indenture, exclusive, however, of
Securities of any series as to which such Person is not Trustee.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such installment of principal or interest is due and payable.
"Subsidiary" means any Corporation of which securities (excluding
securities entitled to vote for directors only by reason of the happening of a
contingency) entitled to elect at least a majority of the corporation's
directors shall at the time be owned, directly or indirectly, by the Company, or
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
7
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used with respect to the Securities of any series shall mean the Trustee with
respect to Securities of that series.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed, except as provided
in Section 905.
"U.S. Government Obligations" means direct obligations of the United States
of America, backed by its full faith and credit.
"Vice President", when used with respect to the Company, means any vice
president, whether or not designated by a number or a word or words added before
or after the title "vice president".
"Voting Stock", when used with respect to a Corporation, means stock of the
class or classes having general voting power under ordinary circumstances to
elect at least a majority of the board of directors, managers or trustees of
such Corporation (irrespective of whether at the time stock or securities of any
other class or classes shall have or might have voting power by reason of the
happening of any contingency).
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture 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 whether such covenant or condition has been
complied with; and
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(4) a statement whether, in the opinion of each such individual, such
condition or covenant has been complied with.
Every such certificate or opinion provided under this Indenture shall be without
personal recourse to the individual executing the same and may include an
express statement to such effect.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of any 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 such officer's 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. All applications, requests, consents, certificates,
statements, opinions or other instruments given under this Indenture shall be
without personal recourse to any individual giving the same and may include an
express statement to such effect.
SECTION 104. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in writing,
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any
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purpose of this Indenture and (subject to Section 601) conclusive in favor of
the Trustee and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than such signer's individual capacity, such
certificate or affidavit shall also constitute sufficient proof of such signer's
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 ownership of Securities shall be proved by the Security Register.
The Company may fix any day as the record date for the purpose of determining
the Holders of Securities of any series entitled to give or take any request,
demand, authorization, direction, notice, consent, waiver or other action, or to
vote on any action, authorized or permitted to be given or taken by Holders of
Securities of such series. If not set by the Company prior to the first
solicitation of a Holder of Securities of such series made by any Person in
respect of any such action, or, in the case of any such vote, prior to such
vote, the record date for any such action or vote shall be the 30th day (or, if
later, the date of the most recent list of Holders required to be provided
pursuant to Section 701) prior to such first solicitation or vote, as the case
may be. With regard to any record date for action to be taken by the Holders of
one or more series of Securities, only the Holders of Securities of such series
on such date (or their duly designated proxies) shall be entitled to give or
take, or vote on, the relevant action.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
SECTION 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with a Responsible Officer of the Trustee at its Corporate Trust
Office, Attention: Corporate Trust Department, or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
in writing and mailed, first-class postage prepaid, to the Company
addressed to it at the address of its principal
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office specified in the first paragraph of this instrument (Attention:
Treasurer) or at any other address previously furnished in writing to the
Trustee by the Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at such Holder's address as it appears in the Security Register,
not later than the latest date, and not earlier than the earliest date,
prescribed for the giving of such notice. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then such
notice shall be given by such other method as the Company shall reasonably
determine and the same shall constitute a sufficient notification for every
purpose hereunder.
SECTION 107. Compliance with Trust Indenture Act.
This Indenture is subject to, and shall be governed by, the provisions of
the Trust Indenture Act that are required to be part of this Indenture. If any
provision hereof limits, qualifies or conflicts with a provision of the Trust
Indenture Act that is required under such Act to be a part of and govern this
Indenture, the latter provision shall control. If any provision of this
Indenture modifies or excludes any provision of the Trust Indenture Act that may
be so modified or excluded, the latter provision shall be deemed to apply to
this Indenture as so modified or to be excluded, as the case may be.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company or the
Trustee shall bind its successors and assigns, whether so expressed or not.
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SECTION 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied, shall
give to any Person, other than the parties hereto, any Authenticating Agent, any
Paying Agent, any Securities Registrar, and their successors hereunder and the
Holders, any benefit or any legal or equitable right, remedy or claim under this
Indenture.
SECTION 112. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with the laws of the State of New York, without regard for principles
of conflicts of law thereof.
SECTION 113. Legal Holidays.
Except as may be otherwise specified with respect to any particular
Securities, 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) 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 such unpaid interest or
principal (and premium, if any) for the period from and after such Interest
Payment Date, Redemption Date or Stated Maturity, as the case may be.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Securities of each series shall be in substantially the form set forth
in this Article, or in such other form as shall be established by or pursuant to
a Board Resolution and set forth in an Officers' Certificate or established by
one or more indentures supplemental hereto, in each case with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of the Securities. When the form of Securities
of
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any series is established by action taken pursuant to a Board Resolution, a copy
of an appropriate record of such action shall be certified by the Secretary or
an Assistant Secretary of the Company and delivered to the Trustee at or prior
to the delivery of the Company Order contemplated by Section 303 for the
authentication and delivery of such Securities.
The Trustee's certificates of authentication shall be in substantially the
form set forth in this Article with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture.
The definitive Securities may be printed, lithographed or engraved on steel
engraved borders or may be produced in any other manner, all as determined by
the officers executing such Securities, as evidenced by their execution of such
Securities.
SECTION 202. Form of Face of Security.
[Insert any legend required by the Internal Revenue Code and the regulations
thereunder.]
JOSTENS, INC.
--------------------------
No._____________ [$]___________
Jostens, Inc., a corporation duly organized and existing under the laws of
Minnesota (herein called the "Company", which term includes any successor Person
under the Indenture hereinafter referred to), for value received, hereby
promises to pay to _______________________, or registered assigns, the principal
sum of _______________ [Dollars] on ____________________ [If the Security is to
bear interest prior to Maturity, insert --, and to pay interest thereon from
___________ or from the most recent Interest Payment Date to which interest has
been paid or duly provided for, [semiannually in arrears on ______________ and
___________ in each year] [annually in arrears on ___________], 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. 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
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not inconsistent with the requirements of any securities exchange on which the
Securities of this series may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in said Indenture]. [If the
Security is not to bear interest prior to Maturity, insert --. The principal of
this Security shall not bear interest except in the case of a default in payment
of principal upon acceleration, upon redemption or at Stated Maturity and in
such case the overdue principal 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 [If applicable,
insert --; provided, however, that at the option of the Company payment of
interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register].
[If applicable, insert -- [The Securities of this series are/This Security
is] subject to redemption prior to the Stated Maturity as described on the
reverse hereof.]
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 or on
behalf of the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
Dated:
JOSTENS, INC.
By______________________________
Attest:
______________________________
SECTION 203. 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 [DATE], 1999 (herein called the
"Indenture"), between the Company and Norwest Bank Minnesota, N.A., as Trustee
(herein called the "Trustee", which term includes any successor trustee under
the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be authenticated and delivered. This Security is one of the series
designated on the face hereof [, limited in aggregate principal amount to [$]
____________________]. By the terms of the Indenture, additional Securities [If
applicable, insert -- of this series and] of other separate series, which may
vary as to date, amount, Stated Maturity, interest rate or method of calculating
the interest rate and in other respects as therein provided, may be issued in an
unlimited principal amount.
[If applicable, insert -- [The Securities of this series are/This Security
is] subject to redemption prior to the Stated Maturity hereof upon not less than
30 days' notice by mail to the Person[s] in whose name[s] [the Securities to be
redeemed are/this Security is] registered at the address specified in the
Security Register, [If applicable, insert -- (1) on ___________ in any year
commencing with the year and _____________ ending with the year _____________
through operation of the sinking fund for this series at a Redemption Price
equal to 100% of the principal amount, and (2)] at any time [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
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[on or before _______________, _____%, and if redeemed] during the 12-month
period beginning of the years indicated,
Redemption Redemption
Year Price Year Price
---- ---------- ---- ----------
and thereafter at a Redemption Price equal to ____% of the principal amount, [If
applicable, 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 whose Stated Maturity is on or prior to (but not
after) such Redemption Date will be payable to the [Holders of such
Securities/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 there is no sinking fund,
insert -- [The Securities of this series are/This Security is] not subject to
any sinking fund.]
[If applicable, insert -- [The Securities of this series are/This Security
is] subject to redemption prior to the Stated Maturity hereof upon not less than
30 days' notice by mail to the Person[s] in whose name[s] [the Securities to be
redeemed are/this Security is] registered at the address specified in the
Security Register, (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 (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:
Redemption Price
for Redemption Redemption Price for
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
---- ----------------- -----------------------
If redeemed during the 12-month period beginning ________________ of the years
indicated, and thereafter at a Redemption Price equal to % of the principal
amount [If applicable, 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 whose Stated Maturity is on or prior to (but not after) such Redemption
Date will be payable to the [Holders of such Securities/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].]
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[Notwithstanding the foregoing, the Company may not, prior to ____ , redeem
any Securities of this series as contemplated by [Clause (2) of] the preceding
paragraph as a part of, or in anticipation of, any refunding operation by the
application, directly or indirectly, of moneys borrowed having an interest cost
to the Company (calculated in accordance with generally accepted financial
practice) of less than _____% per annum.]
[The sinking fund for this series provides for the redemption on
____________ in each year beginning with the year _____ and ending with the year
_____ of [not less than] [$]___________ [("mandatory sinking fund") and not more
than [$]__________] aggregate 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.]]
[In the event of redemption of this Security in part only, a new Security
or Securities of this series and of like tenor or an authorized denomination for
the unredeemed portion hereof will be issued in the name of the Holder hereof
upon the cancellation hereof, and, in the event of transfer or exchange, a new
Security or Securities of this series and of like tenor and for a like aggregate
principal amount will be issued to the Holder, in the case of exchange, or the
designated transferee or transferees, in the case of transfer.]
[If the Security is not an Original Issue Discount Security, -- 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 (subject to the
conditions set forth in the Indenture) be declared due and payable in the manner
and with the effect provided in the Indenture.]
[If the Security is an Original Issue Discount Security, -- If an Event of
Default with respect to Securities of this series shall occur and be continuing,
a lesser amount than the principal amount due at the Stated Maturity of the
Securities of this series may (subject to the conditions set forth in the
Indenture) be declared due and payable in the manner and with the effect
provided in the Indenture. The amount due and payable on this Security in the
event that this Security is declared due and payable prior to the Stated
Maturity hereof shall be -- 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 contains provisions for defeasance at any time of the
Company's obligations in respect of (i) the entire indebtedness of this Note or
(ii) certain restrictive covenants with respect to this Note, in each case upon
compliance with certain conditions set forth therein.
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
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Holders of the Securities of each series to be affected under the Indenture at
any time by the Company and the Trustee with the consent of the Holders of not
less than a majority in aggregate principal amount of the Securities at the time
Outstanding of each series to be affected and, for certain purposes, without the
consent of the Holders of any Securities at the time Outstanding. The Indenture
also contains provisions permitting the Holders of specified percentages in
aggregate principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange hereof or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
[If the Security is an Original Issue Discount Security, -- 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 under the Indenture or whether a quorum is present at a
meeting of Holders of Securities, the principal amount of any 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 the acceleration of the Maturity thereof.]
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 on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Company in any place where the principal of (and premium, if any)
and interest on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or such Holder's attorney
duly authorized in writing, and thereupon one or more new Securities of this
series, of like tenor and of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form without
coupons in denominations of [$1,000] and any amount in excess thereof which is
an integral multiple of [$1,000]. 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.
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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 in the Security Register as the
owner hereof for all purposes, whether or not this Security be overdue, and
neither the Company, the Trustee nor any such agent shall be affected by notice
to the contrary.
The Securities shall be governed by and construed in accordance with the
laws of the State of New York.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
SECTION 204. Form of Trustee's Certificate of Authentication.
This is one of the Securities of the series designated therein and issued
pursuant to the within-mentioned Indenture.
NORWEST BANK MINNESOTA, N.A.
as Trustee
By_______________________________
Authorized Officer
SECTION 205. Form of Legend for Global Securities.
Any Global Security authenticated and delivered hereunder shall, in
addition to the provisions contained in Sections 202 and 203, bear a legend in
substantially the following form or such other form as may be required by the
Depositary:
"Unless this certificate is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New York) to the
issuer or to 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 requested by an authorized representative of The Depository
Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
since the registered owner hereof, Cede & Co., has an interest herein."
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ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. Securities of any one
series need not be issued at the same time, and unless specifically provided
otherwise, a series may be reopened, without the consent of the Holders, for
issuances of additional securities of such series.
There shall be established by or pursuant to a Board Resolution and,
subject to Section 303, set forth or determined in the manner provided in an
Officers' Certificate or established in one or more indentures supplemental
hereto, prior to the initial issuance of Securities of any series,
(1) the title of the Securities of the series (which shall distinguish
the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of
the series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in lieu of, other Securities of the series pursuant to
Section 304, 305, 306, 906, 1107 and except for any Securities which,
pursuant to Section 303, are deemed never to have been authenticated and
delivered hereunder);
(3) the Person to whom any interest on a Security of the series shall
be payable, if other than the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest;
(4) the date or dates on which the principal or installments of
principal of the Securities of the series is or are payable and any rights
to extend such date or dates;
(5) 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 such interest shall accrue, the
Interest Payment Dates on which such interest shall be payable and the
Regular Record Date for the interest payable on any Interest Payment Date;
(6) the place or places where the principal of (and premium, if any)
and interest on Securities of the series shall be payable, any Securities
of the series may be
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surrendered for registration of transfer or exchange and notices and
demands to or upon the Company with respect to the Securities of the series
and this Indenture may be served;
(7) 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;
(8) the obligation, if any, of the Company to redeem or purchase
Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or periods
within which, the price or prices at which and the terms and conditions
upon which Securities of the series shall be redeemed or purchased, in
whole or in part, pursuant to such obligation;
(9) if other than denominations of $1,000 or any amount in excess
thereof which is an integral multiple of $1,000, the denominations in which
Securities of the series shall be issuable;
(10) the currency, currencies or currency units in which payment of
the principal of and any premium and interest on any Securities of the
series shall be payable if other than the currency of the United States of
America, the manner of determining the U.S. dollar equivalent of the
principal amount thereof for purposes of the definition of "Outstanding" in
Section 101, provided, however, that prior to the issuance of any such
Securities, the Company shall have obtained the written consent of the
Trustee, which consent may be withheld in the sole reasonable discretion of
the Trustee, to the currency, currencies or currency units so established
and, if the principal of or any premium or interest on any Securities of
the series is to be payable, at the election of the Company or a Holder
thereof, in one or more currencies or currency units other than that or
those in which the Securities are stated to be payable, the currency,
currencies or currency units 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 be payable, and the periods within which and the terms and
conditions upon which such election is to be made;
(11) any other event or events of default applicable with respect to
Securities of the series in addition to or in lieu of those provided in
Section 501(1) through (7);
(12) any other restrictive covenants applicable with respect to the
Debt Securities of the series in addition to or in lieu of those provided
in Sections 1007 and 1008;
(13) if less than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section
502;
(14) any index used to determine the amount of payment of principal of
and any premium and interest on the Securities of the series;
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(15) whether the Securities of the series shall be issued in whole or
in part in the form of one or more Global Securities and, if so, (a) the
Depositary with respect to such Global Security or Securities and (b) the
circumstances under which any such Global Security may be exchanged for
Securities registered in the name of, and any transfer of such Global
Security may be registered to, a Person other than such Depositary or its
nominee, if other than as set forth in Section 305;
(16) if principal of or any premium or interest on the Securities of a
series is denominated or payable in a currency or currencies other than the
currency of the United States of America, whether and under what terms and
conditions the Company may be discharged from obligations pursuant to
Sections 403 and 1107 with respect to Securities of such series; and
(17) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as permitted by
Section 901(5)).
All Securities of any one series (other than Securities offered in a
Periodic Offering) shall be substantially identical except as to denomination
and except as may otherwise be provided by or pursuant to the Board Resolution
referred to above and, subject to Section 303, set forth, or determined in the
manner provided, in the Officers' Certificate referred to above or in any such
indenture supplemental hereto.
If any of the terms of the series are established by action taken pursuant
to a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
With respect to Securities of a series offered in a Periodic Offering, such
Board Resolution and Officers' Certificate or supplemental indenture may provide
general terms or parameters for Securities of such series and provide either
that the specific terms of particular Securities of such series shall be
specified in a Company Order or that such terms shall be determined by the
Company or its agents in accordance with other procedures specified in a Company
Order as contemplated by the third paragraph of Section 303.
SECTION 302. Denominations.
Unless otherwise provided in the applicable Officers' Certificate or
supplemental indenture, the Securities of each series shall be issued in
registered form without coupons in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such provisions with respect
to the Securities of any series, the Securities of such series shall be issuable
in denominations of $1,000 or any amount in excess thereof which is an integral
multiple of $1,000.
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SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman
of the Board, its President or one of its Vice Presidents. The signature of any
of these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, or, in the case of Securities
offered in a Periodic Offering, from time to time in accordance with such other
procedures (including, without limitation, the receipt by the Trustee of
electronic instructions from the Company or its duly authorized agents, promptly
confirmed in writing by the Company) acceptable to the Trustee as may be
specified from time to time by a Company Order for establishing the specific
terms of particular Securities being so offered, and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities. If the
form or forms or terms of the Securities of the series have been established by
or pursuant to one or more Board Resolutions as permitted by Sections 201 and
301, in authenticating such Securities and accepting the additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and (subject to Section 601) shall be
fully protected in relying upon, an Opinion of Counsel stating,
(a) that the form or forms of such Securities have been established in
conformity with the provisions of this Indenture;
(b) that the terms of such Securities have been established in
conformity with the provisions of this Indenture;
(c) that such Securities, when authenticated and delivered by the
Trustee, issued by the Company and paid for by the purchasers thereof in
the manner and subject to any conditions specified in such Opinion of
Counsel, will constitute valid and legally binding obligations of the
Company, enforceable in accordance with their terms, subject to bankruptcy,
insolvency, reorganization and other laws of general applicability relating
to or affecting the enforcement of creditors' rights and to general equity
principles;
(d) that authentication and delivery of such Securities and the
execution and delivery of the supplemental indenture, if any, by the
Trustee will not violate the terms of the Indenture;
(e) that the Company has the corporate power to issue such Securities,
and has duly taken all necessary corporate action with respect to such
issuance; and
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(f) that the issuance of such Securities will not contravene the
articles of incorporation or bylaws of the Company or result in any
violation of any of the terms or provisions of any law or regulation or of
any indenture, mortgage or other agreement known to such Counsel by which
the Company is bound, which contravention or violation would reasonably be
expected to materially adversely affect the Company's performance of its
obligations with respect to the Securities;
provided, however, that, with respect to Securities of a series offered in a
Periodic Offering, the Trustee shall be entitled to receive such Opinion of
Counsel in connection only with the first authentication of each form of
Securities of such series and that the opinions described in Clauses (b) and (c)
above may state, respectively, that
(b) if the terms of such Securities are to be established pursuant to
a Company Order or pursuant to such procedures as may be specified from
time to time by a Company Order, all as contemplated by a Board Resolution
or action taken pursuant thereto, such terms will have been duly authorized
by the Company and established in conformity with the provisions of this
Indenture; and
(c) that such Securities, when executed by the Company, completed,
authenticated and delivered by the Trustee in accordance with this
Indenture, and issued and delivered by the Company and paid for, all in
accordance with any agreement of the Company relating to the offering,
issuance and sale of such Securities, will be duly issued under this
Indenture and will constitute valid and legally binding obligations of the
Company, enforceable in accordance with their terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws relating to or
affecting generally the enforcement of creditors' rights and to general
principles of equity.
With respect to Securities of a series offered in a Periodic Offering, the
Trustee may rely, as to the authorization by the Company of any of such
Securities, the form or forms and terms thereof and the legality, validity,
binding effect and enforceability thereof, upon the Opinion of Counsel, Company
Order and other documents delivered pursuant to Sections 201 and 301 and this
Section, as applicable, in connection with the first authentication of a form of
Securities of such series and it shall not be necessary for the Company to
deliver such Opinion of Counsel and other documents (except as may be required
by the specified other procedures, if any, referred to above) at or prior to the
time of authentication of each Security of such series unless and until the
Trustee receives notice that such Opinion of Counsel or other documents have
been superseded or revoked, and may assume compliance with any conditions
specified in such Opinion of Counsel (other than any conditions to be performed
by the Trustee). If such form or forms or terms have been so established, the
Trustee shall not be required to authenticate such Securities if the issue of
such Securities pursuant to this Indenture will affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture or otherwise in a
manner which is not reasonably acceptable to the Trustee.
Each Security shall be dated the date of its authentication.
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No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder and is entitled to the
benefits of this Indenture. Notwithstanding the foregoing, if any Security shall
have been authenticated and delivered hereunder but never issued and sold by the
Company, and the Company shall deliver such Security to the Trustee for
cancellation as provided in Section 309 together with a written statement (which
need not comply with Section 102 and need not be accompanied by an Opinion of
Counsel) stating that such Security has never been issued and sold by the
Company, for all purposes of this Indenture such Security shall be deemed never
to have been authenticated and delivered hereunder and shall never be entitled
to the benefits of this Indenture.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities of any Series, the Company
may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten or otherwise
produced, in any authorized denomination, substantially of the tenor of the
definitive Securities in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers
executing such Securities may determine, as evidenced by their execution of such
Securities.
If temporary Securities of any series are issued, the Company will cause
definitive Securities of that series to be prepared without unreasonable delay.
After the preparation of definitive Securities of such series, the temporary
Securities of such series shall be exchangeable for definitive Securities of
like tenor of such series upon surrender of the temporary Securities of such
series at the office or agency of the Company in a Place of Payment for that
series, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities of any series the Company shall execute and the
Trustee shall authenticate and deliver in exchange therefor a like principal
amount of definitive Securities of the same series and of like tenor and of any
authorized denominations. Until so exchanged the temporary Securities of any
series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of such series and tenor.
SECTION 305. Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is hereby
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of any series
at the office or agency of the Company in any 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)
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one or more new Securities of the same series, of any authorized denominations
and of a like aggregate principal amount and tenor.
At the option of the Holder, Securities of any series may be exchanged for
other Securities of the same series, of any authorized denominations and of a
like aggregate principal amount and tenor, upon surrender of the Securities to
be exchanged at the office or agency of the Company in any Place of Payment for
such series. Whenever any Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt and entitled to the same benefits under this Indenture as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Security Registrar duly executed, by the Holder thereof or
such Holder's attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.
The Company may but 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 the day of the mailing of a notice of
redemption of Securities of that series selected for redemption under Section
1103 and ending at the close of business on the day of such mailing, or (ii) to
register the transfer of or exchange any Security so selected for redemption in
whole or in part, except the unredeemed portion of any Security being redeemed
in part.
Notwithstanding the foregoing, except as otherwise specified as
contemplated by Section 301, any Global Security shall be exchangeable pursuant
to this Section 305 for Securities registered in the name of Persons other than
the Depositary for such Security or its nominee only if (i) such Depositary
notifies the Company that it is unwilling or unable to continue as Depositary
for such Global Security or if at any time such Depositary ceases to be a
clearing agency registered under the Exchange Act, (ii) the Company executes and
delivers to the Trustee a Company Order that such Global Security shall be so
exchangeable or (iii) there shall have occurred and be continuing an Event of
Default with respect to the Securities of such series. Upon the occurrence in
respect of any Global Security of any series of any one or more of the
conditions specified in Clauses (i), (ii) or (iii) of the preceding sentence or
such other conditions as may be specified as contemplated by Section 301 for
such series, such Global Security may be exchanged for Securities not bearing
the legend specified in Section 205 and registered in the names of such Persons
as may be specified by the Depositary (including Persons other than the
Depositary).
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Notwithstanding any other provision of this Indenture (except the
provisions of the preceding paragraph), a Global Security may not be transferred
except as a whole by the Depositary for such Global Security to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
new Security of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and upon its written request the Trustee
shall authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Unless otherwise provided as contemplated by Section 301 with respect to
any series of Securities, interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the Person in whose name that Security (or one or
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more Predecessor Securities) is registered in the Security Register at the close
of business on the Regular Record Date for such Interest Payment Date.
Any interest on any Security of any series which is payable but is not
punctually paid or duly provided for on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holder on the
relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each Security of such series and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted Interest as in this Clause provided. Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted Interest
which shall be not more than 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 Securities of
such series at such Holder's address 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 Securities of such series (or their
respective Predecessor Securities) are registered at the close of business
on such Special Record Date and shall no longer be payable pursuant to the
following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of, or in exchange
for, or in lieu of, any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
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SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered in the Security Register as the
owner of such Security for the purpose of receiving payment of principal of (and
premium, if any) and (subject to Section 307) interest on such Security and for
all other purposes whatsoever, whether or not such Security be overdue, and
neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.
No holder of any beneficial interest in any Global Security held on its
behalf by a Depositary (or its nominee) shall have any rights under this
Indenture with respect to such Global Security or any Security represented
thereby, and such Depositary may be treated by the Company, the Trustee, and any
agent of the Company or the Trustee as the owner of such Global Security or any
Security represented thereby for all purposes whatsoever. Notwithstanding the
foregoing, with respect to any Global 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
Depositary or impair, as between a Depositary and such holders of beneficial
interest, the operation of customary practices governing the exercise of the
rights of the Depositary (or its nominees) as Holder of any Security.
SECTION 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly canceled by it. The Company may at any time deliver to the
Trustee for cancellation any Securities previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever, and may
deliver to the Trustee (or to any other Person for delivery to the Trustee) for
cancellation any Securities previously authenticated hereunder which the Company
has not issued and sold, and all Securities so delivered shall be promptly
canceled by the Trustee. No Securities shall be authenticated in lieu of or in
exchange for any Securities canceled as provided in this Section, except as
expressly permitted by this Indenture. All canceled Securities held by the
Trustee shall be retained and destroyed by the Trustee.
SECTION 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for Securities
of any series, interest on the Securities of each series shall be computed on
the basis of a 360-day year of twelve 30-day months.
SECTION 311. Payment to be in Proper Currency.
In the case of any Securities denominated in any currency (the "Required
Currency") other than United States of America dollars, except as otherwise
provided therein, the obligation
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of the Company to make any payment of principal, premium or interest thereon
shall not be discharged or satisfied by any tender by the Company, or recovery
by the Trustee, in any currency other than the Required Currency, except to the
extent that such tender or recovery shall result in the Trustee timely holding
the full amount of the Required Currency then due and payable. If any such
tender or recovery is in a currency other than the Required Currency, the
Trustee may take such actions as it considers appropriate to exchange such
currency for the Required Currency. The costs and risks of any such exchange,
including without limitation the risks of delay and exchange rate fluctuation,
shall be borne by the Company, the Company shall remain fully liable for any
shortfall or delinquency in the full amount of Required Currency then due and
payable, and in no circumstances shall the Trustee be liable therefor except in
the case of its negligence or willful misconduct.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 306 and (ii)
Securities for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as provided in
Section 1003) have been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of
the Company,
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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, in the currency in
which such Securities are payable, sufficient to pay and
discharge the entire indebtedness on such Securities not
theretofore delivered to the Trustee for cancellation, for
principal (and premium, if any) and interest to the date of such
deposit (in the case of Securities which have become due and
payable) or to the respective Stated Maturity or Redemption Date,
as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company, and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614, and, if money shall
have been deposited with the Trustee pursuant to Subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003, shall survive.
SECTION 402. Application of Trust Money.
Subject to provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee but such money need not be segregated from other funds except to the
extent required by law.
SECTION 403. Defeasance and Discharge of Indenture.
If principal of and any premium and interest on Securities of any series
are denominated and payable in United States of America dollars, the Company
shall be deemed to have paid and discharged the entire indebtedness on all the
Outstanding Securities of such series on the 123rd day after the date of the
deposit referred to in subparagraph (d) hereof, and the provisions of this
Indenture, as it relates to such Outstanding Securities, shall no longer be in
effect (and the Trustee, at the expense of the Company, shall at Company
Request, execute proper instruments acknowledging the same), except as to:
(a) the rights of Holders of Securities to receive, from the trust
funds described in subparagraph (d) hereof, (i) payment of the principal of
(and premium, if any) or interest on the Outstanding Securities on the
Stated Maturity of such principal or installment of principal or interest
and (ii) the benefit of any mandatory sinking fund
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payments applicable to the Securities on the day on which such payments are
due and payable in accordance with the terms of this Indenture and the
Securities;
(b) the Company's obligations with respect to such Securities under
Sections 305, 306, 1002 and 1003; and
(c) the rights, powers, trusts, duties and immunities of the Trustee
hereunder;
provided that, the following conditions shall have been satisfied:
(d) The Company has deposited or caused to be irrevocably deposited
with the Trustee (or another trustee satisfying the requirements of Section
609) as trust funds in the trust, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of the Securities, (i)
money in an amount, or (ii) 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 one day before the due date of any
payment referred to in clause (A) or (B) of this subparagraph (d) money in
an amount or (iii) a combination thereof, sufficient, in the opinion of a
nationally recognized firm of independent certified public accountants
expressed in a written certification thereof delivered to the Trustee, to
pay and discharge (A) the principal of (and premium, if any) and each
installment of principal of (and premium, if any) and interest on the
Outstanding Securities on the Stated Maturity of such principal or
installment of principal and interest and (B) any mandatory sinking fund
payments applicable to the Securities on the day on which such payments are
due and payable in accordance with the terms of this Indenture and of the
Securities;
(e) such deposit shall not cause the Trustee with respect to the
Securities to have a conflicting interest as defined in Section 608 and for
purposes of the Trust Indenture Act with respect to the Securities;
(f) 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;
(g) such provision would not cause any Outstanding Securities then
listed on the New York Stock Exchange or other securities exchange to be
de-listed as a result thereof;
(h) no Event of Default or event which with notice or lapse of time
would become an Event of Default with respect to the Securities shall have
occurred and be continuing on the date of such deposit or during the period
ending on the 123rd day after such date;
(i) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel to the effect that there has been a change in
applicable Federal law such that, or the Company has received from, or
there has been published by, the Internal
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Revenue Service a ruling to the effect that, Holders of the Securities will
not recognize income, gain or loss for Federal income tax purposes as a
result of such deposits, 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; and
(j) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
relating to the defeasance contemplated by this Section have been complied
with.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities of any
series, and unless otherwise provided with respect to Securities of any series
pursuant to Section 301(11), 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, and continuance of such
default for a period of 30 days; 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 a series of one or more 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 aggregate 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
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(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 by any
party other than the Company 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 all or substantially all of its property, or
ordering the winding up or liquidation of its affairs, and the continuance
of any such decree or order for relief specified in clause (A) or (B) or
any such other decree or order unstayed and in effect for a period of 60
consecutive days; or
(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 bankruptcy or insolvency 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 other similar official of the Company or of all or
substantially all 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 as provided in Section 301(11).
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Outstanding Securities of any series
occurs and is continuing, then and in every such case the Trustee or the Holders
of not less than 25% in aggregate 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 lesser 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 portion thereof)
shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Outstanding Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter in this Article provided, the Holders of a majority in
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aggregate principal amount of the Outstanding Securities of that series, by
written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of
that series which have become due otherwise than by such declaration
of acceleration and interest thereon at the rate or rates prescribed
therefor in such Securities,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates prescribed
therefor in such Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 607; and
(2) all Events of Default with respect to Securities of that series,
other than the non-payment of the principal of Securities of that series
which have become due solely by such declaration of acceleration, have been
cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if:
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(2) default is made in the payment of the principal of (or premium, if
any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Security, the whole amount then due and payable on such Security
for principal (and premium, if any) and interest and, to the extent that payment
of such interest shall be legally enforceable, interest on any overdue principal
(and premium, if any) and on any overdue interest at the rate or rates
prescribed therefor in such Security, 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.
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If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon such Security 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 Security, wherever
situated.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
SECTION 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or all or substantially all of the property of the Company or of such
other obligor, 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
premium, if any) or such portion of the principal amount of any series of
Original Issue Discount Securities as may be specified in the terms of such
series 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 any other amounts due the Trustee
under Section 607) and of the Holders allowed in such judicial proceeding,
and
(ii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 607.
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Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and for any other amounts due
the Trustee under Section 607, be for the ratable benefit of the Holders of the
Securities in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal (or premium,
if any) or interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the Securities in
respect of which or for the benefit of which such money has been collected,
ratably, without preference or priority of any kind, according to the
amounts due and payable on such Securities for principal (and premium, if
any) and interest, respectively; and
THIRD: The balance, if any, to the Person or Persons entitled thereto.
SECTION 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder,
unless
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
series;
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(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee, for 60 days after its receipt of such notice, request
and offer of indemnity, has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and
Interest.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of (and premium, if any) and (subject to Section 307)
interest on such Security on the Stated Maturity or Maturities expressed in such
Security (or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to such Holder, then and in every such case, subject to any determination in
such proceeding, the Company, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of Section
306, no right or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be
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cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
SECTION 512. Control by Holders.
The Holders of a majority in aggregate principal amount of the Outstanding
Securities of any series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Securities of such series, provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in aggregate principal amount of
the Outstanding Securities of any series may, on behalf of the Holders of all
the Securities of such series, waive any past default hereunder with respect to
such series and its consequences, except a default
(1) in the payment of the principal of (or premium, if any) or
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;
provided that, a majority in aggregate principal amount of Outstanding
Securities may rescind and annul a declaration of payment due as provided in
Section 502.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Persons entitled to waive any past default hereunder.
If a record date is fixed, the
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Holders on such record date, or their duly designated proxies, and only such
Persons, shall be entitled to waive any default hereunder, whether or not such
Holders remain Holders after such record date; provided, that unless such
majority in principal amount shall have waived such default prior to the date
which is 90 days after such record date, any such waiver of such default
previously given shall automatically and without further action by any Holder be
canceled and of no further effect.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
SECTION 514. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security by
such Holder's 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; provided,
however, that the provisions of this Section shall not apply to any suit
instituted by the Company, to any suit instituted by the Trustee, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% in principal amount of the Outstanding Securities of any series, or to
any suit instituted by any Holder for the enforcement of the payment of the
principal of (or premium, if any) or interest on any Security on or after the
Stated Maturity or Maturities expressed in such Security (or, in the case of
redemption, on or after the Redemption Date).
SECTION 515. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
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ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
The provisions of TIA Section 315 shall apply to the Trustee.
SECTION 602. Notice of Defaults.
Within 90 days after the occurrence of any default hereunder with respect
to the Securities of any series, the Trustee shall transmit by mail to all
Holders of Securities of such series, as their names and addresses appear in the
Security Register, notice of such default hereunder known to the Trustee, unless
such default shall have been cured or waived; provided however, that, except in
the case of a default in the payment of the principal of (or premium, if any) or
interest on any Security of such series or in the payment of any sinking fund
installment with respect to Securities of such series, the 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 Trustee in good faith determine that the withholding of such
notice is in the interest of the Holders of Securities of such series; and
provided, further, that in the case of any default of the character specified in
Section 501(4) with respect to Securities of such series, no such notice to
Holders shall be given until at least 30 days after the occurrence thereof. For
the purpose of this Section, the term "default" means any event which is, or
after notice or lapse of time or both would become, an Event of Default with
respect to Securities of such series.
SECTION 603. Certain Rights of Trustee.
Subject to the provisions of TIA Section 315(a) through 315(d):
(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, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order or as
otherwise expressly provided herein and any 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;
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(d) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such fact 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;
(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;
(h) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or within
the discretion, rights or powers conferred upon it by this Indenture; and
(i) the Trustee shall not be required to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its
duties hereunder or in the exercise of any of its rights or powers if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it.
SECTION 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and neither the Trustee nor any Authenticating Agent assumes any responsibility
for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Securities. The Trustee or any
Authenticating Agent shall not be accountable for the use or application by the
Company of Securities or the proceeds thereof.
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SECTION 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to TIA
Sections 310(b) and 311, 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 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed with the Company.
SECTION 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee
of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee and its agents 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.
The obligations of the Company under this Section 607 to compensate and
indemnify the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness hereunder
and shall survive the satisfaction and discharge of this Indenture. Such
additional indebtedness shall be a senior claim to that of the Securities upon
all property and funds held or collected by the Trustee as such, except funds
held in trust for the payment of principal of (and premium, if any) or interest
on particular Securities, and the Securities are hereby subordinated to such
senior claim.
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SECTION 608. Disqualification; Conflicting Interests.
The provisions of TIA Section 310(b) shall apply to the Trustee.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be eligible to
act under TIA Section 310(a)(1) and shall have a combined capital and surplus of
at least $50,000,000 and subject to supervision or examination by Federal, State
or District of Columbia authority. If such Corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the 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. Neither
the Company, nor any Person directly or indirectly controlling, controlled by or
under common control with the Company, shall act as Trustee hereunder.
SECTION 610. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.
(b) The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 611 shall
not have been delivered to the Trustee within 90 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
(c) The Trustee may be removed at any time with respect to the Securities
of any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.
(d) If at any time:
(1) the Trustee shall fail to comply with TIA Section 310(b) after
written request therefor by the Company or by any Holder who has been a
bona fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and shall
fail to resign after written request therefor by the Company or by any such
Holder, or
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(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (ii) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, with respect
to the Securities of one or more series, the Company, by a Board Resolution,
shall promptly appoint a successor Trustee or Trustees with respect to the
Securities of that or those series (it being understood that any such successor
Trustee may be appointed with respect to the Securities of one or more or all of
such 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 611. If, within one year after such resignation, removal
or incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Securities of any series shall be appointed by Act of the Holders
of a majority in principal amount of the Outstanding Securities of such series
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment in accordance
with the applicable requirements of Section 611, become the successor Trustee
with respect to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee with respect
to the Securities of any series shall have been so appointed by the Company or
the Holders and accepted appointment in the manner required by Section 611, any
Holder who has been a bona fide Holder of a Security of such series for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities of such series.
(f) The Company shall give notice of each resignation and each removal of
the Trustee with respect to the Securities of any series and each appointment of
a successor Trustee with respect to the Securities of any series by mailing
written notice of such event by first-class mail, postage prepaid, to all
Holders of Securities of such series as their names and addresses appear in the
Security Register. Each notice shall include the name of the successor Trustee
with respect to the Securities of such series and the address of its Corporate
Trust Office.
SECTION 611. Acceptance of Appointment by Successor.
(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
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rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or 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. Whenever there is a successor Trustee with
respect to one or more (but less than all) series of securities issued pursuant
to this Indenture, the terms "Indenture" and "Securities" shall have the
meanings specified in the provisos to the respective definitions of those terms
in Section 101 which contemplate such situation.
(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) and (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.
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SECTION 612. Merger, Conversion, Consolidation or Succession to Business.
Any Corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any Corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
Corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
Corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities; in case
any of the Securities shall not have been authenticated by the Trustee then in
office, any successor by merger, conversion or consolidation to such Trustee may
authenticate such Securities either in the name of such predecessor hereunder or
in the name of the successor Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Securities or in this
Indenture provided that the certificate of the Trustee shall have; provided,
however, that the right to adopt the certificate of authentication of any
predecessor Trustee or to authenticate Securities in the name of any predecessor
Trustee shall apply only to its successor or successors by merger, conversion or
consolidation.
SECTION 613. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Section 311(a). A Trustee which has
resigned or been removed is subject to TIA Section 311(a) to the extent
indicated therein.
SECTION 614. Appointment of Authenticating Agent.
At any time when any of the Securities remain Outstanding the Trustee, with
the concurrence of the Company, 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, and
Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be a Corporation organized and doing business
under the laws of the United States of America, any State thereof or the
District of Columbia authorized under such laws to act as Authenticating Agent,
having a combined capital and surplus of not less than $50,000,000 and subject
to supervision or examination by Federal, State or District of Columbia
authority. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such Authenticating Agent shall be deemed to be its
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combined capital and surplus as set forth in its most recent report of condition
so published. If at any time an Authenticating Agent shall cease to be eligible
in accordance with the provisions of this Section, such Authenticating Agent
shall resign immediately in the manner and with the effect specified in this
Section.
Any Corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any Corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such Corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the 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 mail written notice of
such appointment by first class mail, postage prepaid, to all Holders of
Securities of the series with respect to which such Authenticating Agent will
serve, as their names and addresses appear in the Security Register. 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 Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section.
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 alternate
certificate of authentication in the following form:
This is one of the Securities of the series designated herein and issued
pursuant to the within-mentioned Indenture.
-------------------------------------
as Trustee
By
-----------------------------------
As Authenticating Agent
By
-----------------------------------
Authorized Officer
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ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
If the Trustee is not acting as Security Registrar for the Securities of
any series, the Company will furnish or cause to be furnished to the Trustee.
(a) at intervals of no more than six months commencing after the first
issue of such series, a list, in such form as the Trustee may reasonably
require, of the names and addresses of the Holders as of a date not more
than 15 days prior to the time such information is furnished, and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the
time such list is furnished.
SECTION 702. Preservation of Information; Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with respect to
their rights under this Indenture or under the Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided by TIA Section
312(b).
(c) Every Holder of Securities, by receiving and holding the same, agrees
with the Company and the Trustee that neither the Company nor the Trustee nor
any agent of either of them shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the Holders
in accordance with Section 702(b), regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under Section 702(b).
SECTION 703. Reports by Trustee.
Within 60 days after May 1 of each year commencing with the later of May 1,
1996 or the first May 1 after the first issuance of Securities pursuant to this
Indenture, the Trustee shall transmit by mail to all Holders of Securities as
provided in TIA Section 313(c) a brief report dated as of such May 1 if required
by TIA Section 313(a). 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
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which any Securities are listed, with the Commission and with the Company. The
Company will notify the Trustee when any Securities are listed on any stock
exchange.
SECTION 704. Reports by Company.
The Company shall:
(1) file with the Trustee, within 15 days after the Company is
required to file the same with the Commission, copies of the annual reports
and of the information, documents and other reports (or copies of such
portions of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Company may be required to file
with the Commission pursuant to Section 13 or Section 15 (d) of the
Securities Exchange Act of 1934; or, if the Company is not required to file
information, documents or reports pursuant to either of said Sections, then
it shall file with the Trustee and the Commission, in accordance with rules
and regulations prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports which may be
required pursuant to Section 13 of the Securities Exchange Act of 1934 in
respect of a security listed and registered on a national securities
exchange as may be prescribed from time to time in such rules and
regulations;
(2) file with the Trustee and the Commission, in accordance with rules
and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance by
the Company with the conditions and covenants of this Indenture as may be
required from time to time by such rules and regulations;
(3) transmit by mail to all Holders, as their names and addresses
appear in the Security Register, within 30 days after the filing thereof
with the Trustee, such summaries of any information, documents and reports
required to be filed by the Company pursuant to paragraphs (1) and (2) of
this Section as may be required by rules and regulations prescribed from
time to time by the Commission; and
(4) furnish to the Trustee, within 120 days after the end of each
fiscal year of the Company ending after the date hereof, a brief
certificate of the Company's principal executive officer, principal
financial officer or principal accounting officer as to his or her
knowledge of the Company's compliance with all conditions and covenants
under this Indenture. For purposes of this paragraph, such compliance shall
be determined without regard to any period of grace or requirement of
notice provided under this Indenture.
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ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person unless: (1) the Person formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance or transfer, or
which leases, the properties and assets of the Company substantially as an
entirety shall be a Corporation, partnership or trust, shall be organized and
validly existing under the laws of the United States of America any State
thereof or the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form satisfactory
to the Trustee, the due and punctual payment of the principal of (and premium,
if any) and interest on all the Securities and the performance or observance of
every covenant of this Indenture on the part of the Company to be performed or
observed; (2) immediately after giving effect to such transaction and treating
any indebtedness which becomes an obligation of the Company or any 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; and (3) the Company has delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, conveyance, transfer or lease and supplemental
indenture comply with this Article and that all conditions precedent herein
provided for relating to such transaction have been complied with.
SECTION 802. Successor Substituted.
Upon any consolidation of the Company with, or merger by the Company into,
any other Person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety in accordance with Section
801, the successor Person formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Securities.
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ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by or
pursuant to 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 one or
more specified series) or to surrender any right or power herein conferred
upon the Company; or
(3) to add any additional Events of Default (and if such Events of
Default are to be for the benefit of less than all series of Securities,
stating that such Events of Default are being included solely for the
benefit of one or more specified series); or
(4) to add to or change any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities, provided that any
such addition, change or elimination (i) shall neither (A) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (B) modify the
rights of the Holder of any such Security with respect to such provision or
(ii) shall become effective only when there is no such Security
Outstanding; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or
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facilitate the administration of the trusts hereunder by more than one
Trustee, pursuant to the requirements of Section 611(b); or
(9) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising
under this Indenture, provided such action shall not adversely affect the
interests of the Holders of Securities of any series in any material
respect.
SECTION 902. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in aggregate
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 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 such Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon
the redemption thereof, or reduce the amount of the principal of an
Original Issue Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section
502, or change any Place of Payment where, or the coin or currency in
which, any such Security or any premium or the interest thereon is payable,
or impair the right to institute suit for the enforcement of any such
payment on or after the Stated Maturity thereof (or, in the case of
redemption or repayment, on or after the Redemption Date or any repayment
date), or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required
for any waiver of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences provided for in this
Indenture, or
(3) modify any of the provisions of this Section 902, Section 513 or
Section 1010, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security affected
thereby; provided however, that this Clause shall not be deemed to require
the consent of any Holder with respect to changes in the references to "the
Trustee" and concomitant changes in this Section 902 and Section 1010, or
the deletion of this proviso, in accordance with the requirements of
Sections 611(b) and 901(8).
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A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Persons entitled to consent to any indenture
supplemental hereto. If a record date is fixed for such purpose, the Holders on
such record date or their duly designated proxies, and only such Persons, shall
be entitled to consent to such supplemental indenture, whether or not such
Holders remain Holders after such record date; provided, that unless such
consent shall have become effective by virtue of the requisite percentage having
been obtained prior to the date which is 90 days after such record date, any
such consent previously given shall automatically and without further action by
any Holder be canceled and of no further effect.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby to the extent provided therein.
SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
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SECTION 906. Reference in Securities to Supplemental Indentures.
Securities 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 a 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 907. Notice of Supplemental Indentures.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of Section 902, the Company
shall give notice thereof to the Holders of each Outstanding Security so
affected, pursuant to Section 106, setting forth in general terms the substance
of such supplemental indenture.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of (and premium,
if any) and interest on the Securities of that series in accordance with the
terms of the Securities and this Indenture. In the absence of contrary
provisions with respect to the Securities of any series, interest on the
Securities of any series may, at the option of the Company, be paid by check
mailed to the address of the Person entitled thereto as it appears on the
Security Register.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities of that series and this Indenture
may be served. The Company will give prompt written notice to the Trustee of the
location and any change in the location of such office or agency. If at any time
the Company shall fail to maintain any such required office or agency or shall
fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
to receive all such presentations, surrenders, notices and demands.
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The Company may also from time to time designate one or more other offices
or agencies where the Securities of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in each Place of Payment for Securities of any series for such purposes. The
Company will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.
SECTION 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with respect
to any series of Securities, it will, on or before each due date of the
principal of (and premium, if any) or interest on any of the Securities of that
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum in the currency in which such series of Securities is payable
sufficient to pay the principal (and premium, if any) or interest so becoming
due until such sums shall be paid to such Persons or otherwise disposed of as
herein provided or will promptly notify the Trustee of its failure so to act.
Whenever the Company shall have one or more Paying Agents for any series of
Securities, it will, prior to each due date of the principal of (and premium, if
any) or interest on any Securities of that series, deposit with a Paying Agent a
sum sufficient to pay the principal (and premium, if any) or interest so
becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal, premium or interest, or (unless such Paying Agent is
the Trustee) the Company will promptly notify the Trustee of its failure so to
act.
The Company will cause each Paying Agent for any series of Securities other
than the Trustee to execute and deliver to the Trustee an instrument in which
such Paying Agent shall agree with the Trustee, subject to the provisions of
this Section, that such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of (and
premium, if any) 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 (and premium, if any) 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
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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 premium, if any)
or interest on any Security of any series and remaining unclaimed for two years
after such principal (and premium, if any) or interest has become due and
payable shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in a newspaper published in
the English language, customarily published on each Business Day and of general
circulation in the Borough of Manhattan, The City of New York, 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 on Company
Request.
SECTION 1004. Existence.
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its existence,
corporate rights (charter and statutory) and corporate franchises; provided,
however, that the Company shall not be required to preserve any such right or
franchise if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
that the loss thereof is not disadvantageous in any material respect to the
Holders.
SECTION 1005. Maintenance of Properties.
The Company will cause all Principal Properties used or useful in the
conduct of its business to be maintained and kept in good condition, repair and
working order and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted; provided, however, that
nothing in this Section shall prevent the Company from discontinuing the
operation or maintenance or selling or disposing of any of such Principal
Properties if such discontinuance, sale or disposition is, in the judgment of
the Company, desirable in the conduct of its business and not disadvantageous in
any material respect to the Holders.
SECTION 1006. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged, before
the same shall become delinquent and a lien upon its property: (1) all taxes,
assessments and
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governmental charges levied or imposed upon it or upon its income, profits or
property, and (2) all lawful claims for labor, materials and supplies upon its
property; provided, however, that the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim whose amount, applicability or validity is being contested in good faith.
SECTION 1007. Restriction on Secured Debt.
(a) The Company will not itself, and will not permit any Restricted
Subsidiary to, incur, issue, assume or guarantee any notes, bonds, debentures or
other similar evidences of indebtedness for money borrowed (notes, bonds,
debentures or other similar evidences of indebtedness for money borrowed being
hereinafter in this Article called "Debt"), secured by pledge of, or mortgage or
other lien on, any Principal Property, now owned or hereafter owned by the
Company or any Restricted Subsidiary, or any shares of stock or Debt of any
Restricted Subsidiary held by or owed to the Company (any such pledges,
mortgages and other liens being hereinafter in this Article called "Lien" or
"Liens"), without effectively providing that the Securities of each series then
Outstanding (together with, if the Company shall so determine, any other Debt of
the Company or such Restricted Subsidiary then existing or thereafter created
which is not subordinate to the Securities of each series then Outstanding)
shall be secured equally and ratably with (or prior to) such secured Debt, so
long as such secured Debt shall be so secured; provided, however, that this
Section shall not apply to, and there shall be excluded from secured Debt in any
computation under this Section, Debt secured by:
(1) Liens existing on the date of this Indenture;
(2) Liens on any Principal Property acquired, constructed or improved
by the Company or any Restricted Subsidiary after the date of this
Indenture which are created or assumed contemporaneously with such
acquisition, construction or improvement, or within 120 days before or
after the completion thereof, to secure or provide for the payment of all
or any part of the cost of such acquisition, construction or improvement
(including related expenditures capitalized for Federal income tax purposes
in connection therewith) incurred after the date of this Indenture;
(3) Liens of or upon any property, shares of capital stock or Debt
existing at the time of acquisition thereof, whether by merger,
consolidation, purchase, lease or otherwise (including Liens of or upon
property, shares of capital stock or indebtedness of a corporation existing
at the time such corporation becomes a Restricted Subsidiary);
(4) Liens in favor of the Company or any Restricted Subsidiary;
(5) Liens in favor of the United States of America or any State
thereof, or any department, agency or instrumentality or political
subdivision of the United States of America or any State thereof or
political entity affiliated therewith, or in favor of any other country, or
any political subdivision thereof, to secure partial, progress, advance or
other payments, or other obligations, pursuant to any contract or statute
or to secure any
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Debt incurred for the purpose of financing all or any part of the cost of
acquiring, constructing or improving the property subject to such Liens
(including Liens incurred in connection with pollution control, industrial
revenue or similar financings);
(6) Liens imposed by law, such as mechanics', workmen's, repairmen's,
materialmen's, carriers', warehousemen's, vendors' or other similar liens
arising in the ordinary course of business, or governmental (federal, state
or municipal) liens arising out of contracts for the sale of products or
services by the Company or any Restricted Subsidiary, or deposits or
pledges to obtain the release of any of the foregoing;
(7) pledges or deposits under workmen's compensation laws or similar
legislation and Liens of judgments thereunder which are not currently
dischargeable, or good faith deposits in connection with bids, tenders,
contracts (other than for the payment of money) or leases to which the
Company or any Restricted Subsidiary is a party, or deposits to secure
public or statutory obligations of the Company or any Restricted
Subsidiary, or deposits in connection with obtaining or maintaining
self-insurance or to obtain the benefits of any law, regulation or
arrangement pertaining to unemployment insurance, old age pensions, social
security or similar matters, or deposits of cash or obligations of the
United States of America to secure surety, appeal or customs bonds to which
the Company or any Restricted Subsidiary is a party, or deposits in
litigation or other proceedings such as, but not limited to, interpleader
proceedings;
(8) Liens created by or resulting from any litigation or other
proceeding which is being contested in good faith by appropriate
proceedings, including Liens arising out of judgments or awards against the
Company or any Restricted Subsidiary with respect to which the Company or
such Restricted Subsidiary is in good faith prosecuting an appeal or
proceedings for review or the time to appeal or petition for rehearing has
not expired; or Liens incurred by the Company or any Restricted Subsidiary
for the purpose of obtaining a stay or discharge in the course of any
litigation or other proceeding to which the Company or such Restricted
Subsidiary is a party;
(9) Liens for taxes or assessments or governmental charges or levies
not yet due or delinquent, or which can thereafter be paid without penalty,
or which are being contested in good faith by appropriate proceedings;
(10) Liens consisting of easements, rights-of-way, zoning
restrictions, restrictions on the use of real property, and defects and
irregularities in the title thereto, landlords' liens and other similar
liens and encumbrances which, other than liens resulting from action of any
governmental authority, do not interfere materially with the use of the
property covered thereby in the ordinary course of the business of the
Company or such Restricted Subsidiary and do not, in the opinion of the
Company, materially detract from the value of such properties;
(11) Liens arising in the ordinary course of business in connection
with obligations that are not overdue or which are being contested in good
faith and by
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appropriate proceedings, including, but not limited to, Liens under bid,
performance and other surety bonds, supersedeas and appeal bonds, Liens on
advance or progress payments received from customers under contracts for
the sale, lease or license of goods, software or services and upon the
products being sold or licensed, in each case securing performance of the
underlying contract or the repayment of such advances in the event final
acceptance or performances under such contracts does not occur;
(12) Liens arising solely by virtue of any statutory or common law
provision relating to bankers' liens, rights of set-off or similar rights
and remedies as to deposit accounts or other funds maintained with a
creditor depository institution; or
(13) any extension, renewal or replacement (or successive extensions,
renewals or replacements), as a whole or in part, of any Lien referred to
in the foregoing clauses (1) to (10), inclusive; provided, that (i) such
extension, renewal or replacement Lien shall be limited to all or a part of
the same property, shares of stock or Debt that secured the Lien extended,
renewed or replaced (plus improvements on such property) and (ii) the Debt
secured by such Lien at such time is not increased.
(b) Notwithstanding the restrictions contained in subdivision (a) of this
Section, the Company and its Restricted Subsidiaries, or any of them, may incur,
issue, assume or guarantee Debt secured by Liens without equally and ratably
securing the Securities of each series then Outstanding, provided, that at the
time of such incurrence, issuance, assumption or guarantee, after giving effect
thereto and to the retirement of any Debt which is concurrently being retired,
the aggregate amount of all outstanding Debt secured by Liens which could not
have been incurred, issued, assumed or guaranteed by the Company or a Restricted
Subsidiary without equally and ratably securing the Securities of each series
then Outstanding except for the provisions of this subdivision (b), together
with the aggregate amount of all Attributable Debt incurred pursuant to Section
1008(b), does not at such time exceed the greater of (a) 25% of Consolidated Net
Tangible Assets of the Company or (b) $30,000,000.
SECTION 1008. Restriction on Sale and Leaseback Transactions.
(a) The Company will not itself, and it will not permit any Restricted
Subsidiary to, enter into any arrangement with any bank, insurance company or
other lender or investor (not including the Company or any Subsidiary) or to
which any such lender or investor is a party, providing for the leasing by the
Company or a Restricted Subsidiary for a period, including renewals, in excess
of three years of any Principal Property which has been or is to be sold or
transferred by the Company or any Restricted Subsidiary to such lender or
investor or to any person to whom funds have been or are to be advanced by such
lender or investor on the security of such Principal Property (herein referred
to as a "Sale and Leaseback Transaction") unless either:
(1) The Company or such Restricted Subsidiary would, at the time of
entering into such arrangement, be entitled, without equally and ratably
securing the Securities of
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each series then Outstanding, to incur Debt secured by a Lien on such
property, pursuant to paragraphs (1) to (11), inclusive, of Section 1007;
or
(2) the Company within 120 days after the sale or transfer shall have
been made by the Company or by a Restricted Subsidiary, applies an amount
equal to the greater of (i) the net proceeds of the sale of the Principal
Property sold and leased back pursuant to such arrangement or (ii) the fair
market value of the Principal Property so sold and leased back at the time
of entering into such arrangement (as determined by any two of the
following: the Chairman of the Board of the Company, its President, its
Chief Financial Officer, its Chief Operating Officer, its Treasurer or its
Vice President, General Counsel) to the retirement of Funded Debt of the
Company; provided, that the amount to be applied to the retirement of
Funded Debt of the Company shall be reduced by (A) the principal amount of
any Securities delivered within 120 days after such sale to the Trustee for
retirement and cancellation, and (B) the principal amount of Funded Debt,
other than Securities, voluntarily retired by the Company within 120 days
after such sale. Notwithstanding the foregoing, no retirement referred to
in this clause (a)(2) may be effected by payment at maturity or pursuant to
any mandatory sinking fund payment or mandatory prepayment provision.
(b) Notwithstanding the restrictions contained in subdivision (a) of this
Section, the Company and its Restricted Subsidiaries, or any of them, may enter
into a Sale and Leaseback Transaction, provided, that at the time of such
transaction, after giving effect thereto, the aggregate amount of all
Attributable Debt in respect of Sale and Leaseback Transactions existing at such
time which could not have been entered into except for the provisions of this
subdivision (b), together with the aggregate amount of all outstanding Debt
incurred pursuant to Section 1007(b), does not at such time exceed the greater
of (a) 25% of Consolidated Net Tangible Assets of the Company or (b)
$30,000,000.
(c) A Sale and Leaseback Transaction shall not be deemed to result in the
creation of a Lien.
SECTION 1009. Defeasance of Certain Obligations.
The following provisions shall apply to the Securities of each series
unless specifically otherwise provided in a Board Resolution, Officers'
Certificate or indenture supplemental hereto provided pursuant to Section 301.
The Company may omit to comply with any term, provision or condition set forth
in Sections 1005, 1006, 1007 and 1008, and any such omission with respect to
Sections 1005, 1006, 1007 and 1008 shall not be an Event of Default, in each
case with respect to the Securities of that series, provided that the following
conditions have been satisfied:
(1) with reference to this Section 1009, the Company has deposited or
caused to be irrevocably deposited with the Trustee (or another trustee
satisfying the requirements of Section 609) 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, (i) money in an amount, or
(ii) U.S. Government Obligations which through the payment
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of interest and principal in respect thereof in accordance with their terms
will provide not later than one day before the due date of any payment
referred to in clause (A) or (B) of this subparagraph (1) money in an
amount, or (iii) 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 (A) the principal of (and premium, if any) and each installment
of principal of (and premium, if any) and interest on the Outstanding
Securities on the Stated Maturity of such principal or installments of
principal and interest and (B) any mandatory sinking fund payments or
analogous payments applicable to the Securities of such series on the day
on which such payments are due and payable in accordance with the terms of
this Indenture and of such Securities;
(2) such deposit shall not cause the Trustee with respect to the
Securities of that series to have a conflicting interest as defined in
Section 608 and for purposes of the Trust Indenture Act with respect to the
Securities of any series;
(3) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any material agreement or
instrument to which the Company is a party or by which it is bound;
(4) such deposit will not cause any Outstanding Securities then listed
on the New York Stock Exchange or other securities exchange to be de-listed
as a result thereof;
(5) no Event of Default under Sections 501(6) or (7) or event which
with notice or lapse of time would become an Event of Default under
Sections 501(6) or (7) with respect to the Securities of that series shall
have occurred and be continuing on the date of such deposit;
(6) the Company has delivered to the Trustee an Opinion of Counsel to
the effect that Holders of the Securities of such series will not recognize
income, gain or loss for Federal income tax purposes as a result of such
deposit and defeasance of certain obligations and will be subject to
Federal income tax on the same amount and in the same manner and at the
same times as would have been the case if such deposit and defeasance had
not occurred; and
(7) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the defeasance contemplated in this Section
have been complied with.
SECTION 1010. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any term,
provision or condition set forth in Sections 1004 to 1008, inclusive, with
respect to the Securities of any series if before the time for such compliance
the Holders of not less than a majority in aggregate principal amount of the
Outstanding Securities of such series shall, by Act of such Holders, either
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waive such compliance in such instance or generally waive compliance with such
term, provision or condition, but no such waiver shall extend to or affect such
term, provision or condition except to the extent so expressly waived, and,
until such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Persons entitled to waive any such term, provision or
condition. If a record date is fixed for such purpose, the Holders on such
record date or their duly designated proxies, and only such Persons, shall be
entitled to waive any such term, provision or condition hereunder, whether or
not such Holders remain Holders after such record date; provided that unless the
Holders of not less than a majority in principal amount of the Outstanding
Securities of such series shall have waived such term, provision or condition
prior to the date which is 90 days after such record date, any such waiver
previously given shall automatically and without further action by any Holder be
canceled and of no further effect.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 301 for Securities of any series) in
accordance with this Article.
SECTION 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced by
an Officers' Certificate. The Company shall, at least 45 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of
(1) such Redemption Date,
(2) if the Securities of such series have different terms and less
than all of the Securities of such series are to be redeemed, the terms of
the Securities to be redeemed, and
(3) if less than all the Securities of such series with identical
terms are to be redeemed, the principal amount of such Securities to be
redeemed.
In the case of any redemption of Securities prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or
elsewhere in this Indenture, the Company
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shall furnish the Trustee with an Officers' Certificate evidencing compliance
with such restriction.
SECTION 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of like tenor 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 like tenor of such series not previously called for redemption, by
such method as the Trustee shall deem fair and appropriate and which may provide
for the selection for redemption of portions (equal to the minimum authorized
denomination for Securities of like tenor of that series or any integral
multiple thereof) of the principal amount of Securities of such series of a
denomination larger than the minimum authorized denomination for Securities of
that series.
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption and, in the case of any Securities selected for partial
redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.
SECTION 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed, at each such Holder's address
appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of like tenor 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,
(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the place or places where such Securities are to be surrendered
for payment of the Redemption Price, and
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(6) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
SECTION 1105. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
money in immediately available funds sufficient to pay the Redemption Price of,
and (except if the Redemption Date shall be an Interest Payment Date) accrued
interest on, all the Securities which are to be redeemed on that date.
SECTION 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with accrued interest
to the Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 301, installments of interest whose Stated Maturity is
on or prior to the Redemption Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Regular Record Dates according to their terms
and the provisions of Section 307.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal (and premium, if any) shall, until paid,
bear interest from the Redemption Date at the rate prescribed therefor in the
Security.
SECTION 1107. Securities Redeemed in Part.
Any Security which is to be redeemed in part shall be surrendered at a
Place of Payment for such series (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 such Holder's attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Security or Securities of the same series
and of like tenor, of any authorized denomination as requested by such Holder,
in aggregate principal amount equal to and in exchange for the unredeemed
portion of the principal of the Security so surrendered; provided, however, that
if a Global Security is so surrendered, such new Security so issued shall be a
new Global Security in a denomination equal to the unredeemed portion of the
principal of the Global Security so surrendered.
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ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of a series except as otherwise specified as
contemplated by Section 301 for Securities of such series.
The minimum amount of any sinking fund payment provided for by the terms of
Securities of any series is herein referred to as a "mandatory sinking fund
payment", and any payment in excess of such minimum amount provided for by the
terms of Securities of any series is herein referred to as an "optional sinking
fund payment". If provided for by the terms of Securities of any series, the
cash amount of any sinking fund payment may be subject to reduction as provided
in Section 1202. Each sinking fund payment shall be applied to the redemption of
Securities of any series as provided for by the terms of Securities of such
series.
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of like tenor of a
series (other than any previously called for redemption) and (2) may apply as a
credit Securities of like tenor 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 like tenor of such series
required to be made pursuant to the terms of such Securities as provided for by
the terms of such series; provided that such Securities have not been previously
so credited. Such Securities shall be received and credited for such purpose by
the Trustee at the Redemption Price specified in such Securities for redemption
through operation of the sinking fund and the amount of such sinking fund
payment shall be reduced accordingly.
SECTION 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for
Securities of like tenor of a series, the Company will deliver to the Trustee an
Officers' Certificate specifying the amount of the next ensuing sinking fund
payment for such Securities pursuant to the terms of such Securities, 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 like tenor of that series pursuant to Section 1202 and, at the
time of delivery of such Officers' Certificate, will also deliver to the Trustee
any Securities to be so delivered. If no such notice shall be delivered by the
Company, such sinking fund payment shall be satisfied by payment of cash. 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
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Section 1103 and cause notice of the redemption thereof to be given in the name
of and at the expense of the Company in the manner provided in Section 1104.
Such notice having been duly given, the redemption of such Securities shall be
made upon the terms and in the manner stated in Sections 1106 and 1107.
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.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed and attested, and in the case of the Trustee its corporate seal to
be hereunto affixed, all as of the day and year first above written.
JOSTENS, INC.
By
-----------------------------------
[Name]
[Title]
Attest:
- ----------------------------
[Name]
Secretary
-----------------------------------
as Trustee
By
-----------------------------------
[Name]
[Title]
Attest:
- ----------------------------
[Name]
[Title]
[SEAL]
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<PAGE>
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
On the _____ day of ______________________, 1999 before me personally came
___________________ to me known, who, being by me duly sworn, did depose and say
that he is _________________ and _________________ of Jostens, Inc., one of the
Corporations described in and which executed the foregoing instrument; and that
he signed his name thereto by authority of the Board of Directors of said
Corporation.
-----------------------------------
Notary Public
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
On the _____ day of _____________________, 1995 before me personally came
_________________ to me known, who, being by me duly sworn, did depose and say
that he is __________________ of Norwest Bank Minnesota, National Association,
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.
[SEAL]
-----------------------------------
Notary Public
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Exhibit 5.1
[Letterhead of Dorsey & Whitney]
July 23, 1999
Jostens, Inc.
5501 Norman Center Drive
Minneapolis, Minnesota 55437
Ladies and Gentlemen:
We have acted as counsel to Jostens, Inc., a Minnesota corporation (the
"Company"), in connection with a Registration Statement on Form S-3 (the
"Registration Statement") relating to the proposed sale from time to time by the
Company of $150,000,000 aggregate principal amount of the Company's Debt
Securities (the "Debt Securities") pursuant to an Indenture (the "Indenture") to
be entered into between the Company and Norwest Bank Minnesota, N.A., as trustee
(the "Trustee").
We have examined such documents, including resolutions of the Board of
Directors of the Company adopted on July 22, 1999 (the "Financing Resolution"),
and have reviewed such questions of law as we have considered necessary and
appropriate for the purposes of the opinion set forth below.
In rendering our opinion set forth below, we have assumed the authenticity
of all documents submitted to us as originals, the genuineness of all signatures
and the conformity to authentic originals of all documents submitted to us as
copies. We have also assumed the legal capacity for all purposes relevant hereto
of all natural persons and, with respect to all parties to agreements or
instruments relevant hereto other than the Company, that such parties had the
requisite power and authority (corporate or otherwise) to execute, deliver and
perform such agreements or instruments, that such agreements or instruments have
been duly authorized by all requisite action (corporate or otherwise), executed
and delivered by such parties and that such agreements or instruments are the
valid, binding and enforceable obligations of such parties. As to questions of
fact material to our opinions, we have relied upon certificates of officers of
the Company and of public officials. Capitalized terms used and not defined
herein shall have the meanings assigned to them in the proposed form of
Indenture included as Exhibit 4.1 to the Registration Statement.
Based on the foregoing, we are of the opinion that when the specific terms
of series of Debt Securities have been specified in a Supplemental Indenture or
an Officers' Certificate which has been executed and delivered to the Trustee by
an officer of the Company authorized to do so in the
<PAGE>
Financing Resolution, such series of Debt Securities will have been duly
authorized by all requisite corporate action and, when executed and
authenticated as specified in the Indenture and delivered against payment
thereof in the manner described in the Registration Statement, will constitute
valid and binding obligations of the Company, enforceable in accordance with the
terms of such series.
The opinion set forth above is subject to the following qualifications and
exceptions:
(a) The opinion is subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally.
(b) The opinion is subject to the effect of general principles of equity,
including (without limitation) concepts of materiality, reasonableness,
good faith and fair dealing and other similar doctrines affecting the
enforceability of agreements generally (regardless of whether considered in
a proceeding at law or in equity).
(c) In rendering the opinion, we have assumed that, at the time of the
authentication and delivery of a series of Debt Securities, the Financing
Resolution referred to above will not have been modified or rescinded,
there will not have occurred any change in the law affecting the
authorization, execution, delivery, validity or enforceability of the Debt
Securities, the Registration Statement will have been declared effective
and will continue to be effective, none of the particular terms of a series
of Debt Securities will violate any applicable law and neither the issuance
and the sale thereof nor the compliance by the Company the terms thereof
will result in a violation of any agreement or instrument then binding upon
the Company or any order of any court or governmental body having
jurisdiction over the Company.
(d) As of the date of this opinion, a judgment for money in an action based
on a Debt Security denominated in a foreign currency or a composite
currency in a federal or State court in the United States ordinarily would
be enforced in the United States only in Untied States dollars. The date
used to determine the rate of conversion into United States dollars of the
foreign currency or composite currency in which a particular Debt Security
is denominated will depend upon various factors, including which court
renders the judgment.
(e) Minnesota Statues Section 290.371 Subd. 4, provides that any
corporation required to file a Notice of Business Activities Report does
not have a cause of action upon which it may bring suit under Minnesota law
unless the corporation has filed a Notice of Business Activities Report and
provides that the use of the courts of the State of Minnesota for all
contracts which a corporation failed to file a required report is
precluded. Insofar as our opinion may relate to the valid, binding and
enforceable character of any agreement under Minnesota law or in a
Minnesota court, we have assumed that any party seeking to enforce such
agreement has at all times been, and will continue at all times to be,
exempt from the
2
<PAGE>
requirement of filing a Notice of Business Activities Report or, if not
exempt, has duly filed, and will continue to duly file, all Notice of
Business Activities Reports.
(f) To the extent that any document expressly provides for the laws of the
State of New York to govern such document, such choice of New York law as
the governing law of each such document is a valid choice of law under the
laws of the State of New York. State courts in the State of New York would
honor the choice of law provisions in the documents providing that New York
law will govern, but we express no opinion as to whether any other courts
would honor any express choice of law provision contained in the documents.
Except as provided in the preceding sentence, we express no opinion as to
what law would govern any particular issue under the documents.
Our opinions expressed above are limited to the laws of the State of New
York and the federal laws of the United States of America.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us in the Prospectus included as
part of the Registration Statement.
Very truly yours,
/s/ Dorsey & Whitney LLP
GLT/ECH
3
<PAGE>
EXHIBIT 12
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
Jostens, Inc. and Subsidiaries
Computation of Ratio of Earnings to Fixed Charges
- ----------------------------------------------------------------------------------------------------------------------------
Three months Six months
ended Years ended ended Years ended
- ----------------------------------------------------------------------------------------------------------------------------
April 3 January 2 January 3 December 28 June 30 June 30 June 30
Dollars in thousands 1999 1999 1998 1996 1996 1995 1994
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Earnings
Income from continuing operations
before income taxes $13,518 $83,520 $ 93,383 $ 26 $87,479 $ 93,893 $48,494
Interest expense
(excluding capitalized interest) 1,122 7,014 6,854 4,324 9,296 5,350 6,701
Portion of rent expense under
long-term operating leases
representative of an interest factor 398 1,233 2,133 1,070 2,103 2,100 2,000
Amortization of debt expense 3 12 12 6 107 102 102
- ---------------------------------------------------------------------------------------------------------------------------
Total earnings $15,041 $91,779 $102,382 $ 5,426 $98,985 $101,445 $57,297
===========================================================================================================================
Fixed charges
Interest expense
(including capitalized interest) 1,267 7,717 6,854 4,324 9,296 5,350 6,701
Portion of rent expense under
long-term operating leases
representative of an interest factor 398 1,233 2,133 1,070 2,103 2,100 2,000
Amortization of debt expense 3 12 12 6 107 102 102
- ----------------------------------------------------------------------------------------------------------------------------
Total fixed charges $ 1,668 $ 8,962 $ 8,999 $ 5,400 $11,506 $ 7,552 $ 8,803
===========================================================================================================================
Ratio of earnings to fixed charges 9.0 10.2 11.4 1.0 8.6 13.4 6.5
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of Jostens, Inc. for
the registration of $200,000,000 of debt securities and to the incorporation by
reference therein of our report dated February 2, 1999, with respect to the
consolidated financial statements of Jostens, Inc. incorporated by reference in
its Annual Report (Form 10-K) for the year ended January 2, 1999 and the related
financial statement schedule included therein, filed with the Securities and
Exchange Commission.
/s/ Ernst & Young LLP
Minneapolis, Minnesota
July 20, 1999
<PAGE>
EXHIBIT 25
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
-----------------------------
[_] CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b) (2)
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
(Exact name of trustee as specified in its charter)
A U.S. National Banking Association 41-1592157
(Jurisdiction of incorporation or (I.R.S. Employer
organization if not a U.S. national Identification No.)
bank)
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479
(Address of principal executive offices) (Zip code)
Stanley S. Stroup, General Counsel
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479
(612) 667-1234
(Agent for Service)
-----------------------------
JOSTENS, INC.
(Exact name of obligor as specified in its charter)
Minnesota 41-0343440
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5501 Norman Center Drive
Minneapolis, Minnesota 55437
(Address of principal executive offices) (Zip code)
-----------------------------
Debt Securities
(Title of the indenture securities)
================================================================================
<PAGE>
Item 1. General Information. Furnish the following information as to the
trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Comptroller of the Currency
Treasury Department
Washington, D.C.
Federal Deposit Insurance Corporation
Washington, D.C.
The Board of Governors of the Federal Reserve System
Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
Item 2. Affiliations with Obligor. If the obligor is an affiliate of the
trustee, describe each such affiliation.
None with respect to the trustee.
No responses are included for Items 3-14 of this Form T-1 because the obligor is
not in default as provided under Item 13.
Item 15. Foreign Trustee. Not applicable.
Item 16. List of Exhibits. List below all exhibits filed as a part of this
Statement of Eligibility. Norwest Bank incorporates
by reference into this Form T-1 the exhibits
attached hereto.
Exhibit 1. a. A copy of the Articles of Association of the
trustee now in effect.*
Exhibit 2. a. A copy of the certificate of authority of the
trustee to commence business issued June 28, 1872,
by the Comptroller of the Currency to The
Northwestern National Bank of Minneapolis.*
b. A copy of the certificate of the Comptroller of
the Currency dated January 2, 1934, approving the
consolidation of The Northwestern National Bank of
Minneapolis and The Minnesota Loan and Trust
Company of Minneapolis, with the surviving entity
being titled Northwestern National Bank and Trust
Company of Minneapolis.*
c. A copy of the certificate of the Acting Comptroller
of the Currency dated January 12, 1943, as to
change of corporate title of Northwestern National
Bank and Trust Company of Minneapolis to
Northwestern National Bank of Minneapolis.*
d. A copy of the letter dated May 12, 1983 from the
Regional Counsel, Comptroller of the Currency,
acknowledging receipt of notice of
<PAGE>
name change effective May 1, 1983 from Northwestern
National Bank of Minneapolis to Norwest Bank
Minneapolis, National Association.*
e. A copy of the letter dated January 4, 1988 from the
Administrator of National Banks for the Comptroller
of the Currency certifying approval of
consolidation and merger effective January 1, 1988
of Norwest Bank Minneapolis, National Association
with various other banks under the title of
"Norwest Bank Minnesota, National Association."*
Exhibit 3. A copy of the authorization of the trustee to exercise
corporate trust powers issued January 2, 1934, by the
Federal Reserve Board.*
Exhibit 4. Copy of By-laws of the trustee as now in effect.*
Exhibit 5. Not applicable.
Exhibit 6. The consent of the trustee required by Section 321(b)
of the Act.
Exhibit 7. A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority. Filed in paper
format pursuant to Form SE.
Exhibit 8. Not applicable.
Exhibit 9. Not applicable.
* Incorporated by reference to exhibit number 25 filed with registration
statement number 33-66026.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the
trustee, Norwest Bank Minnesota, National Association, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this statement of eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of
Minneapolis and State of Minnesota on the 15th day of July, 1999.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
/s/ Jane Y. Schweiger
--------------------------------------
Jane Y. Schweiger
Corporate Trust Officer
<PAGE>
EXHIBIT 6
July 15, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In accordance with Section 321(b) of the Trust Indenture Act of 1939, as
amended, the undersigned hereby consents that reports of examination of the
undersigned made by Federal, State, Territorial, or District authorities
authorized to make such examination may be furnished by such authorities to the
Securities and Exchange Commission upon its request therefor.
Very truly yours,
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
/s/ Jane Y. Schweiger
--------------------------------------
Jane Y. Schweiger
Corporate Trust Officer
